FORM S-4

Approximate date of commencement of proposed sale to public: As soon as practicable after this Registration Statement becomes effective.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box: o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: o


(1)	Estimated solely for the purposes of computing the registration fee pursuant to Rule 457(f)(2) under the Securities Act of 1933.

(2)	Calculated by multiplying the aggregate offering amount by .0001267.

(3)	See inside facing page for table of registrant guarantors.

(4)	No separate consideration will be received for the guarantees.

(5)	No further fee is payable pursuant to Rule 457(n).

The registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrants shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

We are offering to exchange registered 11 1/2% Senior Secured Notes due 2011, or the “exchange notes,” for our outstanding unregistered 11 1/2% Senior Secured Notes due 2011, or the “original notes.” We sometimes refer to the original notes and the exchange notes in this prospectus together as the “notes.” The terms of the exchange notes are substantially identical to the terms of the original notes, except that the exchange notes are registered under the Securities Act of 1933, or the Securities Act, and the transfer restrictions and registration rights and related additional interest provisions applicable to the original notes do not apply to the exchange notes. The original notes will be exchanged for the exchange notes in integral multiples of $1,000 principal amount. This offer will expire at 5:00 p.m., New York City time, on , 2004, unless we extend it. The exchange notes will not trade on any established exchange.

Each broker-dealer that receives exchange notes for its own account pursuant to this exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The letter of transmittal accompanying this prospectus states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for original notes where such original notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of 180 days after the expiration of this exchange offer, we will make this prospectus available to any broker-dealer for use in connection with any such resale. See “Plan of Distribution.”

Please see “Risk Factors” beginning on page 13 for a discussion of certain factors you should consider in connection with this exchange offer.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document we file with the SEC at the SEC’s public reference rooms at 450 Fifth Street, N.W., Room 1024, Washington D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operations of the public reference rooms. Our SEC filings are also available to the public over the Internet at the SEC’s web site at http://www.sec.gov and at the public reference room of the New York Stock Exchange, 20 Broad Street, New York, New York.

This prospectus includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies. The statements contained in this prospectus that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties.

We have used the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will” and similar terms and phrases, including references to assumptions, in this prospectus to identify forward-looking statements. These forward-looking statements are made based on our management’s expectations and beliefs concerning future events affecting us and are subject to uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed in or implied by these forward-looking statements. The following factors are among those that may cause actual results to differ materially from our forward-looking statements:


	•	our ability to comply with financial and other covenants contained in the agreements governing our indebtedness, including our asset based revolving credit facility;

	•	global and regional economic conditions, consumer spending, capital spending levels and industrial production, particularly in segments related to the level of automotive production and spending in the plastics and construction industries;

	•	fluctuations in currency exchange rates of U.S. and foreign countries, including countries in Europe and Asia where we have several principal manufacturing facilities and where many of our customers, competitors and suppliers are based;

	•	fluctuations in interest rates which affect the cost of borrowing;

	•	production and pricing levels of important raw materials, including plastic resins, which are a key material used by purchasers of our plastics technologies products, as well as steel and oil;

	•	lower than anticipated levels of our plant utilization resulting in production inefficiencies and higher costs, whether related to the delay of new product introductions, improved production processes or equipment, or labor relations issues;

	•	customer acceptance of new products introduced during 2003 and products introduced and expected to be introduced in 2004;

	•	any major disruption in production at key customer or supplier facilities or at our facilities;

	•	disruptions in global or regional commerce due to wars, to social, civil or political unrest in the non-U.S. countries in which we operate, and to acts of terrorism, continued threats of terrorism and military, political and economic responses (including heightened security measures) to terrorism;

	•	alterations in trade conditions in and between the U.S. and non-U.S. countries where we do business, including export duties, import controls, quotas and other trade barriers;

	•	changes in tax, environmental and other laws and regulations in the U.S. and non-U.S. countries where we do business;

	•	litigation, claims or assessments, including but not limited to claims or problems related to product liability, warranty or environmental issues;

	•	fluctuations in stock market valuations of pension plan assets or changes in interest rates that could result in increased pension expense and reduced shareholders’ equity and require us to make significant cash contributions in the future; and

	•	the other factors discussed under the heading “Risk Factors” and elsewhere in this prospectus.

All of our forward-looking statements should be considered in light of these factors. We undertake no obligation to update our forward-looking statements or risk factors to reflect new information, future events or otherwise.

Industry and market data used throughout this prospectus were obtained through company research, surveys and studies conducted by third parties including the Society of Plastics Industry, the United States Federal Reserve and the United States Department of Commerce. We have not independently verified market and industry data we derived from third-party sources. While we believe internal company surveys are reliable and market definitions are appropriate, neither these surveys nor these definitions have been verified by any independent sources.

The following summary highlights selected information contained elsewhere in this prospectus. It does not contain all the information that may be important to you. You should read this entire prospectus carefully, particularly the “Risk Factors” section and the financial statements and related notes to those financial statements contained in this prospectus. As used in this prospectus, the terms “we,” “us,” “Milacron,” “our company” and “the company” refer to Milacron Inc. and its subsidiaries on a consolidated basis unless the context requires otherwise. References in this prospectus to “our plastics technologies businesses” refer collectively to the businesses conducted by our Machinery Technologies — North America, Machinery Technologies — Europe and Mold Technologies segments. When we refer to the “March 12 Transactions,” the “June 10 Transactions,” the “Refinancing Transactions” and the “Rights Offering” in this prospectus we are using such terms as defined below in this Prospectus Summary under “The Refinancing Transactions” and “Rights Offering.”

We are the largest and broadest-line manufacturer and supplier of plastics processing equipment and related supplies in North America and the third largest worldwide. Our equipment, supplies and services are used by a wide range of plastics processors to produce plastic products and parts for consumer, commercial and industrial markets. Plastics processing is one of the largest industries in the world with total shipments of plastic products and parts valued at over $300 billion in 2003 in the U.S. alone. We also believe we are the second largest global manufacturer of synthetic (water-based) industrial fluids used in metalworking applications.

We operate in four business segments: Machinery Technologies — North America, Machinery Technologies — Europe, Mold Technologies and Industrial Fluids. Our Machinery Technologies segments manufacture and sell plastics processing equipment, including injection molding, blow molding and extrusion machinery, as well as associated tooling and parts and related services. Our Mold Technologies segment manufactures and supplies mold bases and components used with injection molding machinery. Our Industrial Fluids segment produces and sells metalworking fluids for machining, stamping, grinding and cleaning applications. We sell to a variety of end markets on a global basis, including packaging, automotive, industrial components, construction and building materials, consumer goods and medical applications. In 2003, we generated approximately 38% of our sales outside North America.

In 2003, we generated sales of $739.7 million and a net loss of $191.7 million. Between our fiscal years ending December 31, 1999 and 2002, our sales declined sharply, from $994.3 million to $693.2 million, and our net earnings declined from $70.1 million to a net loss of $222.9 million, as our business was impacted by the general economic downturn and severe manufacturing recession that began in late 2000. This difficult economic environment also significantly impaired our liquidity and access to capital. In response, we reduced our cost structure, exited noncore businesses and entered into the Refinancing Transactions in order to improve our profitability, focus on our core competencies, reduce our indebtedness and increase our financial flexibility.

We were first incorporated in 1884, and our shares have been traded on the New York Stock Exchange since 1946 (Ticker: MZ).

On March 12, 2004, we entered into a definitive agreement whereby Glencore Finance AG and Mizuho International plc purchased $100 million in aggregate principal amount of our new exchangeable debt securities. The proceeds from this transaction, together with existing cash balances, were used to repay our 8 3/8% Notes due March 15, 2004. The securities we issued were $30 million of 20% Secured Step-Up Series A Notes due 2007, which we refer to in this prospectus as the Series A Notes, and $70 million of 20% Secured

Step-Up Series B Notes due 2007, which we refer to in this prospectus as the Series B Notes. The $30 million of Series A Notes were convertible into shares of our common stock at a conversion price of $2.00 per share. Glencore and Mizuho converted the entire principal amount of the Series A Notes into 15 million shares of common stock on April 15, 2004. The Series A Notes and Series B Notes initially bore a combination of cash and pay-in-kind interest at a total rate of 20% per annum, which rate was retroactively reset on June 10, 2004 to 6% per annum from the date of issuance, payable in cash.

On March 12, 2004, we also reached a separate agreement with Credit Suisse First Boston for a $140 million senior secured credit facility having a term of approximately one year. This senior secured credit facility consisted of a $65 million revolving A facility, which we refer to in this prospectus as the revolving A facility, and a $75 million term loan B facility, which we refer to in this prospectus as the term loan B facility. On March 12, 2004, we used extensions of credit under the revolving A facility and term loan B facility in an aggregate amount of $84 million to repay and terminate our then-existing revolving credit facility (and to replace or provide credit support for outstanding letters of credit) and our then-existing receivables purchase program.

As used in this prospectus, the term “March 12 Transactions” refers to the issuance of $30 million of Series A Notes and $70 million of Series B Notes, the initial extensions of credit under the revolving A facility and the term loan B facility, and the applications of the proceeds of the foregoing as described above.

On June 10, 2004, the common stock into which the Series A Notes were converted and the Series B Notes were exchanged for 500,000 shares of a new series of our convertible preferred stock with a cumulative cash dividend rate of 6%. We refer to this new series of convertible preferred stock in this prospectus as the Series B Preferred Stock. On June 10, 2004, we also satisfied the conditions to release to us from escrow the proceeds from the offering of the original notes and entered into an agreement for a new $75 million asset based revolving credit facility with JPMorgan Chase Bank as administrative agent and collateral agent, which we refer to in this prospectus as our asset based facility.

On June 10, 2004, we applied the proceeds of the offering of original notes, together with $7.3 million in borrowings under our asset based facility and approximately $10.3 million of cash on hand, to:


	•	purchase €114,990,000 of the €115 million aggregate outstanding principal amount of Milacron Capital Holdings B.V.’s 7 5/8% Guaranteed Bonds due in April 2005, which we refer to in this prospectus as the Eurobonds, at the settlement of a tender offer therefor;

	•	terminate and repay $19 million in amounts outstanding under the revolving A facility (we also used $17.4 million of availability under our asset based facility to replace or provide credit support for the outstanding letters of credit under the revolving A facility);

	•	repay the $75 million term loan B facility; and

	•	pay transaction expenses.

As used in this prospectus, the term “June 10 Transactions” refers collectively to (1) the issuance of the original notes and the release to us from escrow of the proceeds therefrom, (2) the execution and delivery of the definitive documentation for, and the initial borrowings and issuances of letters of credit under, our asset based facility, (3) the exchange of the common stock into which the Series A Notes were converted and the Series B Notes for shares of Series B Preferred Stock and (4) the use of the proceeds of the original notes and our asset based facility as described above. As used in this prospectus, the term “Refinancing Transactions” refers collectively to the March 12 Transactions and the June 10 Transactions on a cumulative basis.

Upon the effectiveness of a registration statement we have filed with the SEC for such purpose, we expect to conduct a rights offering pursuant to which each holder of our common stock (other than any common

stock received upon conversion of Series B Preferred Stock) will be given the right to purchase 0.452 newly issued shares of our common stock per share of common stock held by such holder for a purchase price of $2.00 per share. Exercise of the rights granted in such rights offering, assuming full subscription, would result in the issuance of an additional approximately 16.1 million shares of our common stock and in gross proceeds to the company of $32.2 million. We intend to use the proceeds of this rights offering to redeem up to 30% of the Series B Preferred Stock issued in the June 10 Transactions pursuant to the terms of the Series B Preferred Stock.

As used in this prospectus, the term “Rights Offering” refers collectively to (1) the rights offering described above and (2) the use of the proceeds of such a rights offering to redeem up to 150,000 shares of Series B Preferred Stock.

The exchange notes will have the same financial terms and covenants as the original notes which are as follows:


		ies currently consist of Canadian restricted subsidiaries and Milacron Capital Holdings B.V. (a Dutch subsidiary that guarantees the notes on a senior unsecured basis).

Security		The notes and the guarantees are secured by a first priority security interest in certain of our U.S. assets other than those securing our asset based facility on a first priority basis, as well as certain subsidiary capital stock, and by a second priority security interest in all of our assets securing our asset based facility on a first priority basis, including, among other things, U.S. and Canadian accounts receivable, cash and cash equivalents, inventory and, in the U.S., certain related rights under contracts, licenses and other general intangibles, subject to certain exceptions.

Ranking		The notes and the guarantees are our and the guarantors’ senior obligations and rank senior to all of our and the guarantors’ existing and future indebtedness that is expressly subordinated to the notes and guarantees. The notes and the guarantees rank pari passu in right of payment with all of our and the guarantors’ existing and future senior indebtedness, including indebtedness under our asset based facility. The notes and the guarantees are effectively senior in right of payment to unsecured indebtedness to the extent of the value of the collateral securing the notes and the guarantees. However, the notes are effectively junior in right of payment to the indebtedness and other liabilities of our nonguarantor subsidiaries. As of March 31, 2004, on a pro forma basis giving effect to the June 10 Transactions, our nonguarantor subsidiaries would have had outstanding liabilities of $108.0 million, excluding intercompany liabilities. The notes and the guarantees are effectively junior in right of payment to our $75 million asset based facility to the extent of the value of the collateral securing that facility on a first priority basis.

Optional Redemption		We can redeem all or a portion of the notes at a price equal to 100% plus the “make-whole” premium set forth in this prospectus.

		At any time before May 15, 2007, on one or more occasions, we can choose to redeem up to 35% of the outstanding principal amount of the notes, with the net cash proceeds of certain equity offerings, so long as:

		• we pay holders of the notes a redemption price of 111.5% of the principal amount of the notes we redeem, plus accrued and unpaid interest, if any;

		• we redeem the notes within 90 days of any such equity offering; and

		• at least 65% of the aggregate principal amount of notes initially issued under the indenture remains outstanding immediately after such redemption.

Change of Control		Upon a change of control, we will be required to make an offer to purchase the exchange notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the date of purchase. See “Description of Senior Secured Notes — Repurchase at the Option of Holders — Change of Control.”

Investing in the notes involves a high degree of risk. See the “Risk Factors” section of this prospectus for a description of certain of the risks you should carefully consider before investing in the notes.

Our principal executive office is located at 2090 Florence Avenue, Cincinnati, Ohio 45206-2425 and our telephone number is (513) 487-5000.

The following tables present summary consolidated financial and other data for our company for the periods presented. The unaudited pro forma information for the year ended December 31, 2003 and for the quarter ended March 31, 2004 gives effect to the indicated transactions as if they had occurred at the beginning of the period. We derived the summary consolidated financial and other data for the years ended December 31, 1999, 2000, 2001, 2002 and 2003 based on our audited consolidated financial statements. We derived the summary consolidated financial and other data for the three months ended March 31, 2004 and March 31, 2003 from our unaudited consolidated condensed financial statements. The unaudited consolidated condensed financial statements have been prepared on the same basis as our audited consolidated financial statements and, in the opinion of our management, reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of this data. The results for any interim period are not necessarily indicative of the results that may be expected for a full year. You should read this data in conjunction with the information set forth under “Capitalization,” “Unaudited Pro Forma Consolidated Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements, the related notes and the other financial information in this prospectus.

The following table presents summary consolidated financial and other data for our segments for the periods presented.


(1)	For the periods ended December 31, 2003, 2002 and 2001 and March 31, 2004 and 2003, diluted earnings per common share is equal to basic earnings per common share because the inclusion of potentially dilutive securities would result in a smaller loss per common share.

(2)	In 2002 and 2003, earnings (loss) from discontinued operations includes the following components:


(3)	Represents a pre-tax goodwill impairment charge of $247.5 million ($187.7 million after tax) recorded in 2002 in connection with the mandatory adoption of a new accounting standard.

(4)	Earnings (loss) used in computing the ratios of earnings to fixed charges and earnings to fixed charges plus preferred stock dividends consist of earnings (loss) from continuing operations before income taxes plus fixed charges. Fixed charges consist of interest expense on debt and amortization of deferred debt issuance costs and the portion of rental expense that we believe is representative of the interest component of rental expense. In 2001, 2002, 2003 and the three months ended March 31, 2004, our earnings were insufficient to cover our fixed charges by $51.1 million, $36.7 million, $111.8 million and $14.9 million, respectively. In 2001, 2002, 2003 and the three months ended March 31, 2004, our earnings


	were insufficient to cover our fixed charges plus preferred stock dividends by $51.3 million, $36.9 million, $112.1 million and $14.9 million, respectively.

(5)	Represents the deficiency of earnings in relation to fixed charges on a pro forma basis to give effect to the Refinancing Transactions.

(6)	Represents the deficiency of earnings in relation to fixed charges plus preferred stock dividends on a pro forma basis to give effect to the Refinancing Transactions, assuming that we elect to pay these dividends and have the capacity to pay these dividends in cash under our restricted payments covenant in the indenture governing the notes and under the covenants in the agreement governing our asset based facility.


	The following table sets forth the calculation of preferred stock dividends to give pro forma effect to the Refinancing Transactions.

(7)

Represents the deficiency of earnings in relation to fixed charges plus preferred stock dividends on a pro forma basis to give effect to the Refinancing Transactions and the Rights Offering, assuming that we elect to pay preferred stock dividends and have the capacity to pay these dividends in cash under our restricted payments covenant in the indenture governing the notes and under the covenants in the agreement governing our asset based facility.


	The following table sets forth the calculation of preferred stock dividends to give pro forma effect to the Refinancing Transactions and the Rights Offering.


		would have the option to pay such dividends on a pay-in-kind basis at a rate of 8% per annum rather than the 6% per annum cash rate.


(8)	Operating earnings (loss) for all periods include income or expense related to our principal defined benefit plan for certain U.S. employees. Machinery Technologies — North America recorded pension income of $5.1 million in 1999, $7.0 million in 2000, $7.5 million in 2001, $6.6 million in 2002 and $0.5 million in 2003 and pension expense of $0.2 million in the three months ended March 31, 2003 and $1.5 million in the three months ended March 31, 2004. Industrial Fluids recorded pension income of $0.5 million in 1999, $0.6 million in 2000, $0.6 million in 2001, $1.0 million in 2002 and less than $0.1 million in 2003 and pension expense of less than $0.1 million in the three months ended March 31, 2003 and $0.1 million in the three months ended March 31, 2004. The amounts discussed above exclude the costs of supplemental retirement benefits related to continuing operations of $1.5 million in 1999, $0.8 million in 2001, $4.7 million in 2002 and $3.2 million in 2003. Of these amounts, $0.5 million in 2001 and $2.9 million in 2002 are included in restructuring costs as is the entire $3.2 million in 2003.

	Operating earnings (loss) also include royalty income from the licensing of patented technology to other manufacturers of plastics processing machinery recorded by Machinery Technologies — North America of $8.3 million in 2000, $1.1 million in 2001, $4.5 million in 2002 and $0.9 million in 2003. We negotiated these royalties with certain of our competitors after we determined that they were using our patented designs in the design of their machines. While there can be no assurance that these royalties will continue in the future, we continue to negotiate with additional parties.

You should carefully consider the risks described below and all other information contained in this prospectus before you make a decision to participate in the exchange offer. The risks described below are not the only ones facing our company or relating to participation in the exchange offer.

Original notes which you do not tender or we do not accept will, following the exchange offer, continue to be restricted securities, and you may not offer to sell them except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities law. We will issue exchange notes in exchange for the original notes pursuant to the exchange offer only following the satisfaction of the procedures and conditions set forth in “The Exchange Offer — Procedures for Tendering.” These procedures and conditions include timely receipt by the exchange agent of the original notes and of a properly completed and duly executed letter of transmittal.

Because we anticipate that most holders of original notes will elect to exchange their original notes, we expect that the liquidity of the market for any original notes remaining after the completion of the exchange offer will be substantially limited. Any original notes tendered and exchanged in the exchange offer will reduce the aggregate principal amount at maturity of the original notes outstanding. Following the exchange offer, if you do not tender your original notes you generally will not have any further registration rights, and your original notes will continue to be subject to certain transfer restrictions. Accordingly, the liquidity of the market for the original notes could be adversely affected. The original notes are currently eligible for sale pursuant to Rule 144A and Regulation S through the Private Offering, Resale and Trading through Automated Linkages Market of the National Association of Securities Dealers, Inc. and through The Portal® Market, a subsidiary of The Nasdaq Stock Market, Inc.

In 2001, 2002 and 2003, we experienced significantly lower demand for our plastics machinery, primarily due to the global economic slowdown and, more specifically, a dramatic decline in capital goods spending. These lower levels of demand for plastics machinery led to significantly more intense price competition than we had historically experienced. For example, we have seen an increase in the average discount of our sales prices in relation to our published list prices. In combination, these lower volumes and price levels sharply reduced our profitability and materially and adversely impacted our results of operations, financial condition and access to capital. Our plastics processing customers’ production capacities have been and continue to be underutilized, and they are not making the capital expenditures for new plastics machinery in the volumes and at price levels that our business depends upon.

During the year ended December 31, 2003, our earnings were inadequate to cover fixed charges by $111.8 million. During the same period, on a pro forma basis to give effect to the Refinancing Transactions, our earnings would have been inadequate to cover fixed charges by $116.0 million. We cannot assure you that our business will generate sufficient cash flow from operations to service our indebtedness and pay other expenses, that currently anticipated cost savings and operating improvements will be realized on schedule or at all or that future borrowings will be available to us under our asset based facility in an amount sufficient to enable us to make interest payments on the exchange notes and our other indebtedness or to fund our other liquidity needs.

schedule and volume and pricing levels improve significantly, we may need to fund interest payments on the notes in part with the proceeds of borrowings under our asset based facility. However, our ability to borrow under our asset based facility is subject to borrowing base limitations, including an excess availability reserve, which may be adjusted from time to time by the administrative agent for the lenders under our asset based facility at its discretion, and our satisfaction of certain conditions to borrowing under our asset based facility, including, among other things, conditions related to the continued accuracy of our representations and warranties and the absence of any unmatured or matured defaults (including under financial covenants) or any material adverse change in our business or financial condition. If we have no additional availability or are unable to satisfy the borrowing conditions, our liquidity would be impaired and we would need to sell assets, refinance debt or raise equity to make the interest payments on the exchange notes and otherwise service our debt and pay our expenses. We cannot assure you that we would be able to sell assets, refinance debt or raise equity on commercially acceptable terms or at all, which could cause us to default on our obligations under the notes and our other indebtedness. Our inability to generate sufficient cash flow or draw sufficient amounts under our asset based facility to satisfy our debt obligations and pay our other expenses could cause us to default on our obligations under the notes and would have a material adverse effect on our business, financial condition and results of operations.

Pursuant to the terms of our asset based facility, the cash we receive from collection of receivables is subject to an automatic “sweep” to repay the borrowings under our asset based facility on a daily basis. As a result, we rely on borrowings under our asset based facility as our primary source of cash for use in our North American operations. The availability of borrowings under our asset based facility is subject to a borrowing base limitation, including an excess availability reserve, and conditions to borrowing. Certain of the components of the borrowing base are subject to the discretion of the administrative agent. In addition, the satisfaction of conditions to borrowing under our asset based facility is determined by the administrative agent in its discretion. Further, the administrative agent has the customary ability to reduce, unilaterally, the availability of borrowings at any time by, for example, reducing advance rates, imposing or changing collateral value limitations, establishing reserves or declaring certain collateral ineligible. If the administrative agent exercises its discretion and limits the availability of borrowings under our asset based facility, our liquidity could be materially adversely affected.

As of March 31, 2004, on a pro forma basis to give effect to the June 10 Transactions, we would have had approximately $252 million in total indebtedness. In addition, as of March 31, 2004, we and certain of our non-U.S. subsidiaries have guaranteed $8.2 million of off-balance sheet obligations related to customer financings. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation — Off-Balance Sheet Arrangements.” As of June 10, 2004, after giving effect to initial borrowings and issuances of letters of credit under our asset based facility, we had approximately $50.3 million of undrawn commitments thereunder of which approximately $24.4 million was available to be borrowed.

Our substantial indebtedness could have important consequences to you. For example, it could:


	•	require us to dedicate a substantial portion or even all of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, research and development efforts and other general corporate purposes;

	•	increase the amount of interest expense that we have to pay because some of our borrowings are at variable rates of interest, which, if increased, will result in higher interest payments;

	•	increase our vulnerability to existing and future adverse economic and industry conditions;


	•	limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate;

	•	make it more difficult for us to satisfy our obligations with respect to the notes;

	•	place us at a competitive disadvantage compared to our competitors that have less indebtedness;

	•	limit, along with the financial and other restrictive covenants in our indebtedness, among other things, our ability to borrow additional funds, dispose of assets or pay cash dividends; and

	•	restrict us from making strategic acquisitions, introducing new technologies or exploiting business opportunities.

The agreements governing our indebtedness impose financial and other restrictions upon us, including compliance with certain financial covenants. In addition, our asset based facility is subject to a borrowing base limitation, including an excess availability reserve, which may be adjusted from time to time in the discretion of the administrative agent for the lenders under our asset based facility and is subject to meeting financial covenants. We may not be able to comply with these covenants in the future or satisfy conditions to the availability of borrowings. Failure to achieve compliance with covenants contained in any of these agreements could result in a loss of funding availability or a default under the related agreement, and could lead to acceleration of the related debt and the acceleration of debt under the other agreements which contain cross-acceleration or cross-default provisions. If we are unable to meet our expenses and debt obligations, we will need to refinance all or a portion of our indebtedness, sell assets or raise equity. However, we may not be able to refinance or otherwise repay such indebtedness, sell assets or raise equity on acceptable terms or at all and, if that is the case, we would be unable to pay interest or principal on the exchange notes and our continued viability would be threatened. See “Description of Certain Other Indebtedness.”

We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The terms of the indenture governing the notes do not fully prohibit us or our subsidiaries from doing so. We expect that, subject to borrowing base limitations, including an excess availability reserve, which may be adjusted from time to time in the discretion of the administrative agent for the lenders under our asset based facility, and our satisfaction of certain conditions to borrowing under our asset based facility, including, among other things, conditions related to the continued accuracy of our representations and warranties and the absence of any unmatured or matured defaults (including under financial covenants) or any material adverse change in our business or financial condition, our asset based facility permits additional borrowings thereunder. Borrowings under our asset based facility rank senior to the notes and the subsidiary guarantees to the extent of the realizable value in the collateral securing our asset based facility on a first priority basis. As of June 10, 2004, after giving effect to initial borrowings and issuances of letters of credit under our asset based facility, we had approximately $50.3 million of undrawn commitments thereunder of which approximately $24.4 million was available to be borrowed. If new debt is added to our and our subsidiaries’ current debt levels, the related risks that we and they now face could intensify. See “— Our indebtedness under our asset based facility is effectively senior to the notes to the extent of the value of the collateral securing our asset based facility on a first priority basis and the lien ranking provisions of the indenture and the intercreditor agreement relating to the collateral securing our asset based facility limit the rights of the holders of the exchange notes with respect to that collateral” and “Description of Certain Other Indebtedness.”

The indenture governing the notes and the credit agreement for our asset based facility contain a number of significant restrictions and covenants that limit our ability and our subsidiaries’ ability, among other things, to:


	•	borrow money;

	•	use assets as security in other borrowings or transactions;

	•	pay dividends on stock or purchase stock;

	•	sell assets;

	•	enter into certain transactions with affiliates; and

	•	make certain investments or acquisitions.

In addition, the credit agreement for our asset based facility requires us to satisfy certain financial covenants and restricts our ability and the ability of our subsidiaries to make capital expenditures. Also, the availability of borrowings under our asset based facility are subject to a borrowing base limitation, including an excess availability reserve, which may be adjusted from time to time by the administrative agent for the lenders under our asset based facility at its discretion, and our satisfaction of certain conditions to borrowing under our asset based facility, including, among other things, conditions related to the continued accuracy of our representations and warranties and the absence of any unmatured or matured defaults (including under financial covenants) or any material adverse change in our business or financial condition. Subject to certain limited exceptions, our accounts receivable and inventory, our cash and cash equivalents and certain other collateral, are pledged to secure on a first priority basis our asset based facility and certain other obligations and, subject to certain exceptions, are not permitted to be pledged to secure other indebtedness we or our subsidiaries may otherwise be able to incur.

Events beyond our control, such as prevailing economic conditions, changes in consumer preferences and changes in the competitive environment, could hinder any improvement in, or further impair, our operating performance, which could affect our ability and that of our subsidiaries to comply with the terms of our debt instruments. We cannot assure you that we and our subsidiaries will be able to comply with the provisions of our respective debt instruments, including any applicable financial covenants in the credit agreement for our asset based facility. Breaching any of these covenants or restrictions or the failure to comply with our obligations after the lapse of any applicable grace periods could result in a loss of funding availability or a default under the applicable debt instruments, including the credit agreement for our asset based facility. If there were an event of default, holders of such defaulted debt could cause all amounts borrowed under these instruments to be due and payable immediately. We cannot assure you that our assets or cash flow or that of our subsidiaries would be sufficient to fully repay borrowings under the outstanding debt instruments, either upon maturity or if accelerated upon an event of default or, if we were required to repurchase the exchange notes or any other debt securities upon a change of control, that we would be able to refinance or restructure the payments on such debt. Further, if we are unable to repay, refinance or restructure our indebtedness under our asset based facility, the lenders under our asset based facility could proceed against the collateral securing that indebtedness. In that event, any proceeds received upon a realization of such collateral would be applied first to amounts due under our asset based facility before any proceeds would be available to make payments on the exchange notes. In addition, any event of default or declaration of acceleration under one debt instrument could also result in an event of default under one or more of our or our subsidiaries’ other debt instruments, including the notes.

Due to the restrictions and covenants contained in the credit agreement for our asset based facility, we may need to seek amendments or waivers from our lenders in order to avoid a loss of funding availability or a default resulting from an inability to improve, or further impairment of, our results of operations or our entry into certain transactions we may desire to consummate in the future. In the past we have had to seek amendments and waivers to financing facilities and in certain cases we have agreed to pay the lenders a fee to obtain their consent. We may be required to pay the lenders under our asset based facility a fee for their

We conduct a significant portion of our operations through our nonguarantor subsidiaries and depend, in part, on earnings and cash flows of, and dividends from, these subsidiaries to pay our obligations, including principal and interest on our indebtedness. In addition, we plan to expand the operations of our foreign subsidiaries which will not be guarantors under the exchange notes. During the year ended December 31, 2003, our nonguarantor subsidiaries generated sales of $275.8 million, which constituted 37% of our consolidated sales during the period and our nonguarantor subsidiaries generated net losses of $22.1 million, which constituted 12% of our consolidated net losses during the period. Certain laws restrict the ability of our subsidiaries to pay us dividends or make loans and advances to us. To the extent these restrictions are applied to our nonguarantor subsidiaries, we would not be able to use the earnings of those subsidiaries to make payments on the notes. Furthermore, in the event of any bankruptcy, liquidation or reorganization of a nonguarantor subsidiary, the rights of the holders of notes to participate in the assets of such nonguarantor subsidiary will rank behind the claims of that subsidiary’s creditors, including trade creditors. As a result, the exchange notes will be effectively subordinated to the outstanding indebtedness and other liabilities, including trade payables, of our nonguarantor subsidiaries. As of March 31, 2004, after giving effect to the June 10 Transactions, our nonguarantor subsidiaries would have had $108.0 million of indebtedness and other liabilities outstanding, excluding intercompany liabilities and $12.1 million in additional undrawn borrowing capacity under lines of credit and $260.8 million in total assets, which would have constituted 37% of our total assets.

Our asset based facility is secured by a first priority security interest in, subject to permitted liens, among other things, U.S. and Canadian accounts receivable, cash and cash equivalents, inventory and, in the U.S., certain related rights under contracts, licenses and other general intangibles, subject to certain exceptions. In addition, the indenture governing the notes permits us to incur additional indebtedness secured on a first priority basis by such assets in the future. The first priority security interests in the collateral securing indebtedness under our asset based facility and any such future indebtedness is senior as to such collateral to the security interests securing the notes. The notes are secured, subject to permitted liens, by a second priority security interest in such assets. Holders of the indebtedness under our asset based facility and any other indebtedness secured by a first priority security interest in such collateral will be entitled to receive proceeds from the realization of value of such collateral to repay such indebtedness in full before the holders of the notes will be entitled to any recovery from such collateral. This means that holders of the exchange notes will only be entitled to receive proceeds from the realization of value of assets securing our asset based facility on a first priority basis after all indebtedness and other obligations under our asset based facility are repaid in full. As a result, the notes are effectively junior in right of payment to indebtedness under our asset based facility and any other indebtedness secured by a first priority security interest in, among other things, the assets that secure our asset based facility on a first priority basis, to the extent of the realizable value of such collateral.

The rights of the holders of the exchange notes with respect to the collateral securing the notes on a second priority basis are substantially limited by the terms of the lien ranking agreements set forth in the indenture and the intercreditor agreement. Under the indenture and the intercreditor agreement, at any time that obligations that have the benefit of the first priority liens are outstanding, any actions that may be taken with respect of such collateral, including the ability to cause the commencement of enforcement proceedings

against such collateral and to control the conduct of such proceedings, and the approval of amendments to, releases of such collateral from the lien of, and waivers of past defaults under, such documents relating to such collateral, will be at the direction of the holders of the obligations secured by the first priority liens, and the collateral agent, on behalf of the holders of the notes secured by a second priority lien, will not have the ability to control or direct such actions, even if the rights of holders of the notes are adversely affected.

In addition, the indenture governing the notes contains certain provisions benefiting holders of indebtedness under our asset based facility, which require that the trustee and the collateral agent not object following the filing of a bankruptcy petition to a number of important matters regarding the collateral securing our asset based facility on a first priority basis. After such filing, the value of this collateral could materially deteriorate and you would be unable to raise an objection. The right of holders of obligations secured by first priority liens on such collateral to foreclose upon and sell such collateral upon the occurrence of an event of default also would be subject to limitations under applicable bankruptcy laws if we or any of our subsidiaries become subject to a bankruptcy proceeding.

The notes are secured by a first priority security interest in certain of our U.S. assets other than those securing our asset based facility on a first priority basis, as well as certain subsidiary capital stock, and by a second priority security interest in all of our assets securing our asset based facility on a first priority basis, including, among other things, U.S. and Canadian accounts receivable, cash and cash equivalents, inventory and, in the U.S., certain related rights under contracts, licenses and other general intangibles, subject to certain exceptions. Under the terms of the indenture governing the notes, we will also be permitted in the future to incur indebtedness which can be secured on a shared priority basis by these assets. No appraisal of the value of the collateral has been made in connection with this offering and the value of the collateral in the event of liquidation will depend on market and economic conditions, the availability of buyers and other factors. Based on current market and economic conditions, we do not believe that the proceeds from the sale or sales of all of such collateral would be sufficient to satisfy the amounts due on the notes and any other indebtedness also secured on a shared priority basis by such collateral in the event of a default. If such proceeds were not sufficient to repay amounts due on the notes, then holders of the notes (to the extent not repaid from the proceeds of the sale of the collateral) would only have an unsecured claim against our remaining assets.

The right of the collateral agent to foreclose upon and sell the collateral upon the occurrence of a default will also be subject to limitations under applicable bankruptcy laws if a bankruptcy proceeding were commenced against us or our subsidiaries. In addition, because a portion of the collateral consists of pledges of a portion of the stock of certain of our foreign subsidiaries, the validity of those pledges under local law, if applicable, and the ability of the holders of the notes to realize upon that collateral under local law, to the extent applicable, may be limited by such local law.

The rights of the holders of the notes with respect to the collateral securing the notes will be limited pursuant to the terms of the security documents. Under the terms of the indenture governing the notes, we will also be permitted in the future to incur additional indebtedness which can be secured by the collateral.

In any bankruptcy proceeding with respect to us or any guarantor, it is possible that the bankruptcy trustee, the debtor-in-possession or competing creditors will assert that the fair market value of the collateral with respect to the notes on the date of the bankruptcy filing was less than the then-current principal amount of the notes. Upon a finding by the bankruptcy court that the notes are so under-collateralized, the claims in the bankruptcy proceeding with respect to the notes would be bifurcated between a secured claim and an

unsecured claim, and the unsecured claim would not be entitled to the benefits of security in the collateral. Other consequences of a finding of under-collateralization would be, among other things, a lack of entitlement on the part of the notes to receive post-petition interest and a lack of entitlement on the part of the unsecured portion of the notes to receive other “adequate protection” under federal bankruptcy laws. In addition, if any payments of post-petition interest had been made at the time of such a finding of under-collateralization, those payments could be recharacterized by the bankruptcy court as a reduction of the principal amount of the secured claim with respect to the notes.

The ability of holders of the notes to realize upon the collateral will be subject to certain bankruptcy law limitations in the event of a bankruptcy of the company or any of the guarantors. Under applicable federal bankruptcy laws, secured creditors are prohibited from repossessing their security from a debtor in a bankruptcy case, or from disposing of security repossessed from such a debtor, without bankruptcy court approval. Moreover, applicable federal bankruptcy laws generally permit the debtor to continue to retain collateral even though the debtor is in default under the applicable debt instruments, provided generally that the secured creditor is given “adequate protection.” The meaning of the term “adequate protection” may vary according to the circumstances, but is intended in general to protect the value of the secured creditor’s interest in the collateral at the commencement of the bankruptcy case and may include cash payments or the granting of additional security, if and at such times as the court in its discretion determines, for any diminution in the value of the collateral as a result of the stay of repossession or disposition of the collateral by the debtor during the pendency of the bankruptcy case. In view of the lack of a precise definition of the term “adequate protection” and the broad discretionary powers of a bankruptcy court, we cannot predict whether payments under the exchange notes would be made following commencement of and during a bankruptcy case, whether or when the trustee under the indenture for the exchange notes could foreclose upon or sell the collateral or whether or to what extent holders of exchange notes would be compensated for any delay in payment or loss of value of the collateral through the requirement of “adequate protection.”

Federal and state statutes may allow courts, under specific circumstances, to void our obligations under the notes or the obligations of the guarantors under the guarantees and liens securing the notes or guarantees. These courts could require you to return payments received from us or the guarantors in the event of our or the guarantors’ bankruptcy or other financial difficulty. Under U.S. federal bankruptcy law and comparable provisions of state fraudulent transfer laws, a debt, including a guarantee, or lien on the assets of the debtor could be subordinated to all other indebtedness of that debtor or voided in its entirety if, among other things, the debtor, at the time it incurred the indebtedness evidenced by the notes or its guarantee or the lien on its assets:


	•	incurred the debt or lien with the intent of hindering, delaying or defrauding current or future creditors; or

	•	received less than reasonably equivalent value or fair consideration for incurring the debt or the lien because, for example, it did not directly receive the proceeds of the indebtedness, and


	•	was insolvent or was rendered insolvent by reason of the incurrence;

	•	was engaged, or about to engage, in a business or transaction for which the assets remaining with it constituted unreasonably small capital to carry on such business;

	•	intended to incur, or believed that it would incur, debts beyond its ability to pay as those debts matured; or


	•	was a defendant in an action for money damages, or had a judgment for money damages entered against it if, in either case, after final judgment the judgment was unsatisfied.

The measure of insolvency for purposes of these fraudulent transfer laws will vary depending upon the law of the jurisdiction that is being applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally, however, a debtor would be considered insolvent if, at the time the debtor incurred the indebtedness, either:


	•	the sum of the debtor’s debts and liabilities, including contingent liabilities, was greater than the debtor’s assets at fair valuation; or

	•	the present fair saleable value of the debtor’s assets was less than the amount required to pay the probable liability on the debtor’s total existing debts and liabilities, including contingent liabilities, as they became absolute and matured.

Given our liquidity position and current economic conditions, we cannot assure you that a court would not find us or any of the guarantors to be insolvent.

The terms of the guarantees will provide that they are limited (and subject to reduction) to the extent necessary to prevent such guarantees from constituting fraudulent conveyances. If a court subordinates either a guarantee or a lien or holds it unenforceable, or in the event a guarantee must be limited or voided pursuant to its terms, you will cease to be a creditor of the guarantor and will be a creditor solely of us and the other guarantors. At March 31, 2004, on a pro forma basis to give effect to the June 10 Transactions, our guarantors would have had total liabilities related to continuing operations, excluding liabilities owed to us and guarantees of our indebtedness, of approximately $105.0 million. In the event a court subordinates our obligations under the notes or liens on our assets or holds them unenforceable, your claim for payment from us will be subordinated to other creditors’ claims or you will not be entitled to receive any payment from us. In addition, any payment by us or any guarantor could be voided and required to be returned to us or such guarantor, or to a fund for the benefit of our or such guarantor’s creditors.

Certain of the guarantors are organized outside the United States. For those guarantors, some or all of the directors and officers are residents of jurisdictions outside the United States, and all or a substantial portion of the assets of such guarantors and persons are located outside the United States. As a result, it may difficult or impossible for investors to effect service of process within the United States upon such guarantors or persons or to enforce in the United States judgments of U.S. courts against such guarantors or persons.

We have been advised by our legal counsel that there is doubt as to the enforceability of civil liabilities based on Federal or state securities laws of the United States, either in an original action or in an action to enforce a judgment obtained in U.S. Federal or state courts in jurisdictions that do not have a treaty with the United States providing for reciprocal recognition and enforcement of judgments in civil and commercial matters. Consequently, a final judgment for the payment of money given by any Federal or state court in the United States, whether or not predicated solely upon U.S. federal or state securities laws, would not automatically be enforceable in such a jurisdiction. If the party in whose favor such final judgment is rendered brings a new suit in a competent local court, that party may submit to the local court the final judgment that has been rendered in the United States and the local court may render a judgment in accordance with the final judgment for the payment of money that has been rendered in the United States. However, there can be no assurance that U.S. investors will be able to enforce any judgment in civil or commercial matters against any non-U.S. guarantor, its directors or officers or any expert named in this prospectus who are resident of any country outside the United States.

Upon the occurrence of a change of control, holders of the notes will have the right to require us to purchase all or any part of such holders’ notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase. The occurrence of certain events that constitute a change of control may also constitute a change of control under our asset based facility or our other indebtedness. In that event, we will have to repay borrowings under our asset based facility and/or our other indebtedness in addition to our obligation to repurchase any notes tendered for repurchase. We may not have sufficient funds available to purchase the notes and repay any such other indebtedness and the terms of our debt agreements limit the amount of additional debt we may incur. Our failure to purchase the notes as required under the indenture or repay any such other indebtedness would result in a default under the indenture and our asset based facility and could also result in the acceleration of our other debt, each of which could have material adverse consequences for us and the holders of the exchange notes. See “Description of Certain Other Indebtedness” and “Description of Senior Secured Notes — Repurchase at the Option of Holders — Change of Control.”

In addition, our asset based facility may prohibit us from repurchasing the exchange notes upon a change of control.

The original notes were issued at a discount from their stated principal amount for United States federal income tax purposes. Consequently, original issue discount will be included in the gross income of a U.S. holder of notes for United States federal income tax purposes in advance of the receipt of cash payments on the notes. For more information, see “Certain U.S. Federal Income Tax Considerations.”

The exchange notes are new issues of securities for which there is currently no trading market. We do not intend to apply for listing of the exchange notes on any securities exchange or to seek approval for quotation through any automated quotation system. Accordingly, there can be no assurance that an active market will develop upon completion of the exchange offer or, if developed, that such market will be sustained or as to the liquidity of any market. If an active market does not develop or is not maintained, the market price and liquidity of the exchange notes may be adversely affected. In addition, the liquidity of the trading market in the exchange notes, if developed, and the market price quoted for the exchange notes, may be adversely affected by changes in the overall market for high yield securities and by changes in our financial performance or prospects or in the financial performance or prospects of companies in our industry generally.

The conversion of the Series A Notes into newly issued common stock, and the exchange of such common stock and the Series B Notes for Series B Preferred Stock, triggered an “ownership change” for U.S. federal income tax purposes. As a consequence of this ownership change, the timing of our utilization of tax loss carryforwards and other tax attributes will be substantially delayed. This delay will increase income tax expense and decrease available cash in future years.

The success of our business depends on the profitability of our customers’ businesses. Many of our customers are in businesses that are highly cyclical in nature and sensitive to changes in general economic conditions, such as the automotive, building materials, electronics and consumer durables industries. Their demand for our products and services changes as a result of general economic conditions, interest rates and other factors beyond our control. The performance of our business is directly related to the production levels of our customers. In particular, prices for plastic resins used to make plastic products and parts tend to fluctuate to a greater degree than our customers can adjust for in the pricing of their products. When resin prices increase, our customers’ profit margins decrease, resulting in lower demand for our products. Therefore, our business is affected by fluctuations in the price of resin which could have an adverse effect on our business and ability to generate operating cash flows.

As a result of the significant downturn in the U.S. manufacturing sector that began in 2001, consolidated sales from continuing operations fell from peak levels of $994.3 million in 1999 and $974.5 million in 2000 to $755.2 million in 2001, $693.2 million in 2002 and $739.7 million in 2003. As a result, we sustained substantial losses in 2001, 2002 and 2003. Our net loss from all operations including goodwill impairment charges, restructuring costs, discontinued operations and cumulative effect of change in method of accounting was $35.7 million in 2001, $222.9 million in 2002 and $191.7 million in 2003. In 2001 and 2002, we experienced a substantial decrease in our plastics machinery sales and pricing levels because of the slowdown in many of our plastics technologies businesses end markets. For the year ended December 31, 2003, sales in our three plastics technologies businesses were $635.5 million, compared to $904.2 million, $873.8 million, $662.4 million and $597.2 million in the equivalent periods in 1999, 2000, 2001 and 2002, respectively. From continuing operations, we lost $28.7 million in 2001, $18.4 million in 2002 and $184.5 million in 2003. The loss from continuing operations for 2003 includes a noncash goodwill impairment charge of $65.6 million and an income tax charge of approximately $71 million to establish valuation allowances related to U.S. deferred tax assets. The decline in economic conditions in the industries served by our customers has and may continue to have a material adverse effect on our business and ability to generate positive operating cash flows.

In recent years, many companies have been outsourcing their manufacturing activities to lower cost regions such as Asia and Eastern Europe. The toy industry and the electronics industry, for example, have outsourced much of their manufacturing to areas outside the United States and Western Europe. Retaining business from outsourcing customers involves challenges such as being able to compete for their business with competitors that have more proximate operations, incurring extra costs to supply those customers, and in some cases being able to establish our own manufacturing operations closer to those customers, which involves significant investment and time. If our customers continue to outsource, we may not be able to expand our operations rapidly enough to meet their needs on a cost-effective basis or at all. Additionally, if our competitors expand their operations to areas where manufacturing activities are outsourced before we do, they may increase their customer base at our expense.

Many of the industries in which we operate are highly competitive. Our products may not compete successfully with those of our competitors. The markets for plastics machinery and related products are highly competitive and include a number of North American, European and Asian competitors. Principal competitive factors in the plastics machinery industry are: price, product features, technology, performance, reliability,

We are currently experiencing increased price competition as a result of the general economic downturn, which has resulted in a sharp downward trend in pricing. In certain cases we have lost business to competitors who offered prices lower than ours. In addition, certain of our competitors have built up large excess inventories and therefore may continue to offer their products at prices lower than ours until such inventories are reduced. In addition, some of our competitors may have greater financial resources and less debt than we do which may place us at a competitive disadvantage in the future. These competitors may be better able to withstand and respond to changes in conditions within our industry, such as the dramatic reduction in demand and pricing levels we are experiencing, and throughout the economy as a whole.

Over the past four years we have taken significant actions to realign our cost structure with the lower levels of demand we have experienced and continue to experience in our plastics technologies businesses and are currently implementing additional plans to further reduce our costs. However, we may not be able to fully implement these plans or achieve anticipated cost reductions and we cannot assure you that our cost-savings measures will be successful. In addition, our anticipated cost savings are based upon certain estimates that may prove to be inaccurate. Our ability to achieve the anticipated cost savings could be adversely affected by a number of factors, including, for example, compliance with foreign labor and other laws and regulations and disruptions to our operations that may occur in implementing planned restructurings.

Our business is subject to risks related to the different legal, political, social and regulatory requirements and economic conditions of many jurisdictions. For the year ended December 31, 2003, markets outside the U.S. represented the following percentages of our consolidated sales: Europe 29%; Canada and Mexico 7%; Asia 7%; and the rest of the world 3%. We expect sales from international markets to represent an increasing portion of our total sales. Risks inherent in our international operations include the following:


	•	agreements may be difficult to enforce and receivables difficult to collect through a foreign country’s legal system;

	•	foreign countries may impose additional withholding taxes or otherwise tax our foreign income, impose tariffs or adopt other restrictions on foreign trade or investment, including currency exchange controls;

	•	general economic and political conditions in the countries in which we operate could have an adverse effect on our earnings from operations in those countries;

	•	fluctuations in exchange rates may affect product demand and may adversely affect the profitability in U.S. dollars or products and services provided by us in foreign markets where payment for our products and services is made in the local currency;

	•	unexpected adverse changes in foreign laws or regulatory requirements may occur; and

	•	compliance with a variety of foreign laws and regulations may be difficult.

Our overall success as a global business depends, in part, upon our ability to succeed in differing and unpredictable legal, regulatory, economic, social and political conditions. We may not be able to continue to succeed in developing and implementing policies and strategies that will be effective in each foreign market where we do business. Any of the foregoing factors may have a material adverse effect on our ability to generate cash flow and grow our business.

The financial condition and results of operations of each of our foreign operating subsidiaries are reported in the relevant local currency and then translated to U.S. dollars at the applicable currency exchange rate for inclusion in our financial statements. Exchange rates between these currencies and U.S. dollars in recent years have fluctuated significantly and may do so in the future. For the year ended December 31, 2003, we generated approximately 41% of our sales in foreign currency. Significant changes in the value of the euro relative to the U.S. dollar could have an adverse effect on our financial condition and results of operations and our ability to meet interest and principal payments on euro-denominated debt and U.S. dollar denominated debt, including the notes and borrowings under our asset based facility. For the year ended December 31, 2003, we experienced favorable translation effects on new orders of $40 million and sales of $39 million in relation to the same period in 2002. The effect on earnings was not material. If the euro should weaken against the U.S. dollar in the future, we will experience a negative effect in translating our European new orders, sales and earnings when compared to historical results. In addition to currency translation risks, we incur currency transaction risk whenever one of our operating subsidiaries enters into either a purchase or a sales transaction using a different currency from the currency in which it records revenues. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Given the volatility of exchange rates, we may not be able to effectively manage our currency transaction and translation risks and any volatility in currency exchange rates may have an adverse effect on our financial condition or results of operations and, therefore, on our ability to make principal and interest payments on our indebtedness, including the exchange notes, when due.

Our operations depend upon the economies of the European and Asian markets. These markets include countries with economies in various stages of development or structural reform, some of which are subject to rapid fluctuations in terms of consumer prices, employment levels, gross domestic product, interest and foreign exchange rates. We may be subject to such fluctuations in the local economies. To the extent such fluctuations have an effect on the ability of our consumers to pay for our products, the growth of our products in such markets could be impacted negatively.

Certain of our targeted markets are in countries in which the rate of inflation is significantly higher than that of the U.S. We cannot assure you that any significant increase in the rate of inflation in such countries could be offset, in whole or in part, by corresponding price increases by us even over the long-term.

As of December 31, 2003, the projected benefit obligation under our Milacron Retirement Plan exceeded the plan’s fair value of assets by $124 million, based on an assumed discount rate of 6.25%. We may be required to make significant additional contributions to the plan in the future in order to comply with minimum funding requirements imposed by the Employee Retirement Income Security Act of 1974, as amended, and the Internal Revenue Code of 1986, as amended. The amount of any such required contributions will be determined annually based on an annual actuarial valuation of the plan as performed by the plan’s actuaries. While we currently do not expect to make significant additional contributions to the plan in the near term, we cannot predict whether changing economic conditions or other factors will result in our being required to make contributions to the plan in excess of our current expectations. Based on an actuarial valuation for the plan completed as of January 1, 2003, we expect to contribute approximately $3 million in each of 2004, 2005 and 2006 and up to $8 million in 2007 and $23 million in 2008. Additionally, there is a risk that if the Pension Benefit Guaranty Corporation concludes that its risk with respect to our pension plan may increase unreasonably if it continues to operate, if we are unable to satisfy the minimum funding requirement

for the plan or if the plan becomes unable to pay benefits, then the Pension Benefit Guaranty Corporation could terminate the plan and take control of its assets. In such event, we may be required to make an immediate payment to the Pension Benefit Guaranty Corporation of all or a substantial portion of the underfunding as calculated by the Pension Benefit Guaranty Corporation based upon its own assumptions. The underfunding calculated by the Pension Benefit Guaranty Corporation could be substantially greater than the underfunding we have calculated because, for example, the Pension Benefit Guaranty Corporation may use a significantly lower discount rate. If such payment is not made, then the Pension Benefit Guaranty Corporation could place liens on a material portion of our assets and the assets of any members of our controlled group. Such action could adversely affect our financial condition and results of operation.

As a result of the decline in the financial markets, we changed our assumption for our expected rate of return on plan assets in 2003 from 9.5% to 9% and will continue to use 9% as our expected rate of return in 2004. The change from the 9.5% rate of return assumption to the lower 9% rate had the effect of reducing the amount of pension income that would otherwise be reportable in 2003 by more than $2 million, and we expect that this change will also reduce the amount of pension income that would otherwise be reportable in 2004 by approximately $2 million. Before deducting charges of $4.7 million for supplemental retirement benefits, we recorded pension income of $9.4 million related to this plan in 2002, of which $7.6 million related to continuing operations. In 2003, however, pension income decreased to $0.6 million, once again excluding charges for supplemental benefits of $3.2 million. Moreover, we currently expect to record pension expense related to this plan of approximately $7 million in 2004. Pension expense for 2005 and beyond is dependent on a number of factors including returns on plan assets and changes in the plan’s discount rate and therefore cannot be predicted with certainty at this time.

Because of the significant decrease in the value of the assets of the funded plan for U.S. employees during 2001 and 2002 and decreases in the plan’s discount rate, we recorded a minimum pension liability adjustment of $118 million effective December 31, 2002 and significantly reduced the carrying value of the pension asset related to the plan. This resulted in a $95 million after-tax reduction in shareholders’ equity. At December 31, 2003, shareholders’ equity was increased by $15 million (with no tax effect) due to an increase in plan assets in 2003 that was partially offset by an increase in liabilities that resulted from a lower discount rate. These adjustments were recorded as a component of accumulated other comprehensive loss and therefore did not affect reported earnings or loss. However, they resulted in $81 and $95 million after-tax reductions of shareholders’ equity at December 31, 2003 and December 31, 2002, respectively. Adverse market conditions may result in an increase in the plan’s underfunded position, which may result in further minimum pension liability adjustments.

Our success in the future will depend in part upon our ability to maintain and enhance our technological capabilities, develop and market products and applications that meet changing customer needs and successfully anticipate or respond to technological changes of our competitors in a cost-effective and timely manner. Our inability to anticipate, respond to or utilize changing technologies could cause us to lose customers.

As of June 18, 2004, Glencore and Mizuho collectively owned 100% of the shares of our outstanding Series B Preferred Stock, which represents approximately 57% of our outstanding equity (on an as-converted basis). Glencore has reported in a Schedule 13D filing with the SEC that it has sold an undivided participation interest in its investment in us to Triage Offshore Funds, Ltd. equivalent to 62,500 shares of Series B Preferred Stock, representing approximately 7.2% of our outstanding equity (on an as-converted basis), with Glencore remaining as the record holder of such shares. If we redeem a portion of Glencore’s and Mizuho’s shares of Series B Preferred Stock with the proceeds of the Rights Offering, Glencore’s and Mizuho’s collective holdings would represent approximately 43% of our outstanding equity, with Triage’s participation interest in Glencore’s holdings representing approximately 5.0% of our outstanding equity, in each case on an as-converted basis and assuming full subscription in the Rights Offering. If the initial

conversion price of the Series B Preferred Stock is reset from $2.00 per share to $1.75 per share based upon our failure to meet a financial performance test for 2004 and/or we elect to pay dividends on the Series B Preferred Stock in additional shares of Series B Preferred Stock under certain circumstances, then Glencore’s and Mizuho’s holdings of Series B Preferred Stock would represent a greater percentage of our outstanding equity on an as-converted basis. Glencore and Mizuho also hold contingent warrants to purchase an additional 1,000,000 shares of common stock at $0.01 per share if we fail to meet a financial performance test for 2005. In addition, Glencore and Mizuho have special voting and approval rights as holders of shares of Series B Preferred Stock. By virtue of such stock ownership, Glencore and Mizuho have the power to significantly influence our affairs and to influence, if not decide, the outcome of matters required to be submitted to shareholders for approval, including the election of our directors and amendment of our charter and bylaws. We cannot assure you that Glencore and Mizuho will not exercise their influence over us in a manner detrimental to your interests.

Our future success and competitive position depend in part upon our ability to obtain and maintain certain proprietary technologies used in our principal products. We have not always been successful in preventing the unauthorized use of our existing intellectual property rights by our competitors. For example, in the past we have determined that certain of our competitors were using our patented designs in the designs of their machines. We negotiated royalty payments from these competitors which totaled $8.3 million in 2000, $1.1 million in 2001, $4.5 million in 2002 and $0.9 million in 2003. We cannot assure you that we will be able to discover unauthorized use of our proprietary technologies in the future or that we will be able to receive any payments therefor. If we are not successful in protecting our intellectual property it may result in the loss of valuable technologies or require us to make payments to other companies for infringing on their intellectual property rights. We generally rely on patent, trade secret and copyright laws as well as confidentiality agreements with other parties to protect our technologies; however, some of our technologies may not be protected. We also cannot assure you that:


	•	any of our patents will not be invalidated, circumvented, challenged or licensed to others;

	•	any of our pending or future patent applications will be issued within the scope of the claims sought by us, if at all;

	•	others will not develop technologies that are similar or superior to our technologies, duplicate our technologies or design around our patents; or

	•	steps taken by us to protect our technologies will prevent misappropriation of such technologies.

We also own or have rights to various trademark registrations and trademark registration applications in the United States and certain international jurisdictions that we use in connection with our business. Policing unauthorized use of our trademarks is difficult and expensive, and we cannot assure that we will be able to prevent misappropriation of our trademark rights in all jurisdictions, particularly in countries whose laws do not grant the same protections as does the United States.

We are a defendant in or otherwise a party to numerous lawsuits and other proceedings that result from, and are incidental to, the conduct of our business. These suits and proceedings concern issues including product liability, patent infringement, environmental matters and personal injury matters. In several such lawsuits and proceedings, some of which seek substantial dollar amounts, multiple plaintiffs allege personal injury involving products, including metalworking fluids, supplied and/or managed by us. While it is not feasible to predict the outcome of all pending suits, claims and proceedings, the ultimate resolution of these matters could have an adverse effect upon our business, financial condition, results of operations or reputation.

Our operations are subject to environmental laws and regulations in the U.S. and abroad relating to the protection of the environment and health and safety matters, including those governing discharges of pollutants to the air and water, the management and disposal of hazardous substances and wastes and the clean-up of contaminated sites. The operation of manufacturing plants entails risks under environmental laws and regulations. We could incur significant costs, including clean-up costs, fines and sanctions, and claims by third parties for property damage and personal injury, as a result of violations of or liabilities under these laws and regulations. We are currently involved in a limited number of remedial investigations and actions at various locations, including former plant facilities and off-site disposal sites. While, based on information currently known to us, we believe that we maintain adequate reserves with respect to these matters, our liability could exceed forecasted amounts, and the imposition of additional clean-up obligations or the discovery of additional contamination at these or other sites could result in additional costs. In addition, potentially significant expenditures could be required to comply with environmental laws and regulations, including requirements that may be adopted or imposed in the future.

At December 31, 2003, we had a U.S. federal net operating loss carryforward of $63 million, of which $17 million and $46 million expire in 2022 and 2023, respectively. Deferred tax assets related to this loss carryforward, as well as to federal tax credit carryforwards ($13 million) and additional state and local loss carryforwards ($10 million), totaled $45 million. Additional deferred tax assets totaling approximately $117 million had also been provided for book deductions not currently deductible for tax purposes including the writedown of goodwill, postretirement health care benefit costs and accrued pension liabilities. The deductions for financial reporting purposes are expected to be deducted for income tax purposes in future periods, at which time they will have the effect of decreasing taxable income or increasing the net operating loss carryforward. The latter will have the effect of extending its ultimate expiration beyond 2023.

The transaction entered into with Glencore and Mizuho on March 12, 2004 will substantially delay the timing of the utilization of certain of the U.S. loss carryforwards and other tax attributes that are discussed in the preceding paragraph in future years. See “Risks Relating to Our Liquidity, the Notes and Our Other Indebtedness — ‘Ownership change’ for U.S. federal income tax purposes will cause utilization of our tax loss carryforwards and other tax attributes to be substantially delayed, which will increase income tax expense and decrease available cash in future years.”

At December 31, 2002, no valuation allowances had been provided with respect to the U.S. deferred tax assets based on a “more likely than not” assessment of whether they would be realized. This decision was based on the availability of qualified tax planning strategies and the expectation of increased industrial production and capital spending in the U.S. plastics industry. The higher sales and order levels expected in 2003 and beyond, combined with the significant reductions in our cost structure that had been achieved in recent years, were expected to result in improved operating results in relation to the losses incurred in 2002 and 2001.

At June 30, 2003, however, management concluded that a recovery in the plastics industry and our return to profitability in the U.S. would be delayed longer than originally expected. As a result of these delays and the incremental costs of the restructuring initiatives announced in the third quarter of 2003, we expected to incur a cumulative operating loss in the U.S. for the three-year period ending December 31, 2003. In such situations, accounting principles generally accepted in the U.S. include a presumption that expectations of earnings in the future cannot be considered in assessing the need for valuation allowances. Accordingly, a charge to the tax provision of approximately $71 million was recorded in the second quarter of 2003 to establish valuation allowances with respect to a portion of our U.S. deferred tax assets for which future income was previously assumed.

During the second half of 2003, we increased U.S. deferred tax assets by approximately $18 million due to continued losses from operations and a goodwill impairment charge, the effects of which were partially offset by taxable income related to dividends from non-U.S. subsidiaries. Valuation allowances were also increased by $18 million and as a result, there was no tax benefit for financial reporting purposes associated with the losses and the impairment charge. As of December 31, 2003, U.S. deferred tax assets net of deferred tax liabilities totaled $162 million and U.S. valuation allowances totaled $89 million. We continue to rely on the availability of qualified tax planning strategies and tax carryforwards to conclude that valuation allowances are not required with respect to U.S. deferred tax assets totaling approximately $73 million at December 31, 2003.

Management will reassess its conclusions regarding the amount of valuation allowances that are required on a quarterly basis. Further delays in a recovery in the U.S., particularly in capital spending in the plastics industry, could result in changes in management’s estimates and the related assumptions and a requirement to record additional valuation allowances against the U.S. deferred tax assets. This could result in a further increase in income tax expense and adversely affect our results of operations.

Our ability to provide high-quality products and services depends in part on our ability to retain our skilled personnel in the areas of management, product engineering, servicing and sales. Certain of our businesses rely heavily on key personnel in the engineering, design and formulation of our products. Recent levels of cash flow from operations may hamper our ability to retain certain employees. If we were to lose any of our key employees our results of operations could be adversely affected. In addition, the Refinancing Transactions discussed above, among other things, have had the following impact on awards under our 1997 and 1994 long-term incentive plans: unvested stock options (none of which are currently in-the-money) with respect to approximately 3,525,500 shares of common stock have become vested and exercisable, restrictions have lapsed with respect to approximately 1,026,600 shares of common stock granted in the form of restricted stock awards, an additional 63,710 shares of common stock issued in the form of performance grants have been canceled and settled through cash payments to the grantees of approximately $465,083 and 12,128 shares of common stock that were deferred under the plans have been accelerated. In addition, an amount in cash equal to approximately $1,829,122 became subject to distribution under our Compensation Deferral Plan as a result of the Refinancing Transaction. These events could adversely affect our financial condition and results of operation because of their financial impact and because the retention value of the accelerated awards will be lost and may therefore impact our ability to retain the skilled personnel who hold such awards.

We will not receive any cash proceeds from the issuance of the exchange notes or the exchange offer.

The following table sets forth our consolidated cash and cash equivalents and capitalization as of March 31, 2004 on an actual basis, as adjusted for the June 10 Transactions and as further adjusted for the Rights Offering.

This table should be read in conjunction with “Unaudited Pro Forma Consolidated Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Certain Other Indebtedness” and our consolidated financial statements and unaudited consolidated condensed financial statements and the related notes included in this prospectus.


		amount. Adjustment for drawings under the asset based facility does not include $17.4 million in letters of credit outstanding thereunder as of June 10, 2004.

(d)		The $30 million in aggregate principal amount of Series A Notes was converted by the holders thereof into 15,000,000 shares of our common stock on April 15, 2004. As of June 10, 2004, the shares of common stock into which the Series A Notes had been converted were exchanged for 150,000 shares of Series B Preferred Stock.

(e)		Represents a premium on the Series A Notes and the Series B Notes related to a derivative (as defined in accounting principles generally accepted in the United States) that is embedded therein. The derivative relates to the required increase or decrease in the interest rate on the Series A Notes and the Series B Notes that would have occurred if the Refinancing Transactions had not been approved by our shareholders. The debt premium was applied on June 10, 2004 to reduce the interest expense on the Series A Notes and the Series B Notes from a 20% per annum rate to a 6% per annum rate for the periods of time they were outstanding.

(f)		On June 10, 2004, we purchased 99.99% of the Eurobonds pursuant to the tender offer.

(g)		Represents the aggregate stated principal amount of $225 million of the original notes, net of discount at issuance of $5.2 million.

(h)		Other includes $16.6 million in capital leases and $6.7 million in borrowings under foreign credit facilities.

(i)		On June 10, 2004, we issued 500,000 shares of Series B Preferred Stock, par value $.01 per share, in exchange for the common stock into which the Series A Notes had been converted and the Series B Notes.

(j)		On April 15, 2004, we issued an additional 15,000,000 shares of common stock upon conversion of the Series A Notes into common stock. On June 9, 2004, we obtained shareholder approval to increase the number of authorized common shares to 165,000,000 shares and to decrease the par value of our common shares to $.01 per share. The adjustment for the June 10 Transactions gives effect to the decrease of the par value. The adjustment for the rights offering assumes full subscription in the rights offering.

(k)		The adjustment for the June 10 Transactions includes:


	•	an $18.0 million decrease related to a beneficial conversion feature arising from the difference between the effective conversion price of the Series B Preferred Stock and the March 12, 2004 market value of the common stock into which the Series B Preferred Stock is convertible,

	•	a $6.1 million decrease to be recorded in the second quarter of 2004 related to the 4% tender premium on the Eurobonds and the write-off of deferred financing fees related thereto,

	•	a $6.4 million decrease to be recorded in the second quarter of 2004 that results from the conversion of the Series A Notes into common stock and the required write-off of a financial asset related thereto,

	•	a $6.3 million decrease to be recorded in the second quarter of 2004 related to:


	•	the write-off of deferred financing fees pertaining to the revolving A facility and the term loan B facility and

	•	expense related to the early vesting of 1,090,310 shares of restricted stock due to a change in control provision,


	•	a $1.5 million decrease to be recorded in the second quarter of 2004 for a prepayment penalty related to the term loan B facility and

	•	a $0.6 million increase to be recorded in the second quarter of 2004 for the reset of the interest rates on the Series A Notes and the Series B Notes from 20% to 6% as a result of obtaining shareholder approval for the issuance of the Series B Preferred Stock.

The following tables present selected consolidated financial and other data for our company for the periods presented. The unaudited pro forma information for the year ended December 31, 2003 and for the quarter ended March 31, 2004 gives effect to the indicated transactions as if they had occurred at the beginning of the period. We derived the selected consolidated financial and other data for the years ended December 31, 1999, 2000, 2001, 2002 and 2003 based on our audited consolidated financial statements. We derived the selected consolidated financial and other data for the three months ended March 31, 2004 and March 31, 2003 from our unaudited consolidated condensed financial statements. The unaudited consolidated condensed financial statements have been prepared on the same basis as our audited consolidated financial statements and, in the opinion of our management, reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of this data. The results for any interim period are not necessarily indicative of the results that may be expected for a full year. You should read this data in conjunction with the information set forth under “Capitalization,” “Unaudited Pro Forma Consolidated Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements, the related notes and the other financial information in this prospectus.

The following table presents summary consolidated financial and other data for our segments for the periods presented.


(1)	For the periods ended December 31, 2003, 2002 and 2001 and March 31, 2004 and 2003, diluted earnings per common share is equal to basic earnings per common share because the inclusion of potentially dilutive securities would result in a smaller loss per common share.

(2)	In 2002 and 2003, earnings (loss) from discontinued operations includes the following components:


(3)	Represents a pre-tax goodwill impairment charge of $247.5 million ($187.7 million after tax) recorded in 2002 in connection with the mandatory adoption of a new accounting standard.

(4)	Earnings (loss) used in computing the ratios of earnings to fixed charges and earnings to fixed charges plus preferred stock dividends consist of earnings (loss) from continuing operations before income taxes plus fixed charges. Fixed charges consist of interest expense on debt and amortization of deferred debt issuance costs and the portion of rental expense that we believe is representative of the interest component of rental expense. In 2001, 2002, 2003 and the three months ended March 31, 2004, our earnings were insufficient to cover our fixed charges by $51.1 million, $36.7 million, $111.8 million and


	$14.9 million, respectively. In 2001, 2002, 2003 and the three months ended March 31, 2004, our earnings were insufficient to cover our fixed charges plus preferred stock dividends by $51.3 million, $36.9 million, $112.1 million and $14.9 million, respectively.

(5)	Represents the deficiency of earnings in relation to fixed charges on a pro forma basis to give effect to the Refinancing Transactions.

(6)	Represents the deficiency of earnings in relation to fixed charges plus preferred stock dividends on a pro forma basis to give effect to the Refinancing Transactions, assuming that we elect to pay these dividends and have the capacity to pay these dividends in cash under our restricted payments covenant in the indenture governing the notes and under the covenants in the agreement governing our asset based facility.


	The following table sets forth the calculation of preferred stock dividends to give pro forma effect to the Refinancing Transactions.


	(a)	Assumes the payment of cash dividends on $100 million of liquidation preference of Series B Preferred Stock. If we were restricted by our financing agreements or the terms of our 4% Cumulative Preferred Stock from paying dividends on the Series B Preferred Stock in cash, we would have the option to pay such dividends on a pay-in-kind basis at a rate of 8% per annum rather than the 6% per annum cash rate.

(7)


	The following table sets forth the calculation of preferred stock dividends to give pro forma effect to the Refinancing Transactions and the Rights Offering.


	(a)	Assumes the payment of cash dividends on $100 million of liquidation preference of Series B Preferred Stock. If we were restricted by our financing agreements or the terms of our 4% Cumulative Preferred Stock from paying dividends on the Series B Preferred Stock in cash, we would have the option to pay such dividends on a pay-in-kind basis at a rate of 8% per annum rather than the 6% per annum cash rate.


(8)	Operating earnings (loss) for all periods include income or expense related to our principal defined benefit plan for certain U.S. employees. Machinery Technologies — North America recorded pension income of $5.1 million in 1999, $7.0 million in 2000, $7.5 million in 2001, $6.6 million in 2002 and $0.5 million in 2003 and pension expense of $0.2 million in the three months ended March 31, 2003 and $1.5 million in the three months ended March 31, 2004. Industrial Fluids recorded pension income of $0.5 million in 1999, $0.6 million in 2000, $0.6 million in 2001, $1.0 million in 2002 and less than $0.1 million in 2003 and pension expense of less than $0.1 million in the three months ended March 31, 2003 and $0.1 million in the three months ended March 31, 2004. The amounts discussed above exclude the costs of supplemental retirement benefits related to continuing operations of $1.5 million in 1999, $0.8 million in 2001, $4.7 million in 2002 and $3.2 million in 2003. Of these amounts, $0.5 million in 2001 and $2.9 million in 2002 are included in restructuring costs as is the entire $3.2 million in 2003.

	Operating earnings (loss) also include royalty income from the licensing of patented technology to other manufacturers of plastics processing machinery recorded by Machinery Technologies — North America of $8.3 million in 2000, $1.1 million in 2001, $4.5 million in 2002 and $0.9 million in 2003. We negotiated these royalties with certain of our competitors after we determined that they were using our patented designs in the design of their machines. While there can be no assurance that these royalties will continue in the future, we continue to negotiate with additional parties.

The following unaudited pro forma consolidated financial information has been prepared based on the historical financial statements included elsewhere in this prospectus, adjusted to give pro forma effect to the Refinancing Transactions and the Rights Offering. The unaudited pro forma consolidated statements of operations for the year ended December 31, 2003 and the three months ended March 31, 2004 give effect to the Refinancing Transactions and the Rights Offering as if they had occurred at the beginning of the respective periods. The unaudited pro forma consolidated balance sheet as of March 31, 2004 gives effect to the conversion of the entire $30 million principal amount of Series A Notes into shares of common stock at a price of $2.00 per share on April 15, 2004, the June 10 Transactions and the Rights Offering as if they were completed on that date.

The unaudited pro forma consolidated financial information is based upon currently available information, assumptions, and estimates which we believe are reasonable. These assumptions and estimates, however, are subject to change. In our opinion, all adjustments have been made that are necessary to present fairly the pro forma data. The unaudited pro forma consolidated financial information is presented for informational purposes only and is not indicative of either future results of operations or results that might have been achieved if the transactions had been consummated as of January 1, 2003, January 1, 2004 or March 31, 2004. The unaudited pro forma consolidated financial information should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and with the historical consolidated financial statements, together with the notes related thereto, included in this prospectus.


	of the March 12 Transactions and existing cash, and expense of $1.9 million for the amortization of deferred financing costs related to these borrowings.

The Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2003 does not include or give effect to the following nonrecurring charges directly attributable to the Refinancing Transactions:


	(1)	A $6.4 million charge to interest expense to be recorded in the second quarter of 2004 resulting from the write-off of a financial asset related to the Series A Notes. The asset results from a beneficial conversion feature that allowed the holders of the Series A Notes to acquire common shares of the company at an effective conversion price of $1.96 per common share compared to a fair value of $2.40 per common share on March 12, 2004 when the Series A Notes were issued.

	(2)	A $1.5 million charge to refinancing costs to be recorded in the second quarter of 2004 for a prepayment penalty related to the term loan B facility entered into on March 12, 2004.

	(3)	A charge to refinancing costs of approximately $6.1 million to be recorded in the second quarter of 2004 related to the 4% tender premium on the Eurobonds and the write-off of deferred financing fees related to the Eurobonds.


	(4)	A charge to refinancing costs of $6.3 million to be recorded in the second quarter of 2004 related to (i) the write-off of deferred financing fees pertaining to the revolving A facility and term loan B facility and (ii) expense related to the early vesting of 1,090,310 shares of restricted stock due to a change in control provision.


		shareholder approval of the issuance of the Series B Preferred Stock. Historical interest of $8.6 million on the Series B Notes had been accrued at a 20% per annum rate. This adjustment records interest at 6% per annum for the period prior to the issuance of the Series B Notes and adjusts the interest for the period the Series B Notes were outstanding from 20% per annum to 6% per annum. No interest expense is assumed for the Series A Notes because they are assumed to have been converted into common shares at the beginning of the period. The actual conversion took place on April 15, 2004. Historical interest of $0.3 million had been accrued at a rate of 20% per annum. Because of the assumption of their conversion to common shares, this adjustment eliminates that amount.

(e)		This adjustment reflects interest on borrowings under the revolving A facility and the term loan B facility entered into on March 12, 2004 for the period prior thereto. Interest of $0.2 million on the revolving A facility is based on a rate of 4.75% per annum and an assumed draw against the facility of $8.4 million. Interest of $1.8 million on the term B facility is based on a rate of 12.0% per annum and the $75.0 million principal amount received on March 12, 2004.

(f)		This adjustment eliminates the pro forma interest on the Series B Notes which were repaid with the proceeds received in the June 10 Transactions (see adjustment (d)).

(g)		This adjustment eliminates the pro forma interest on borrowings under the revolving A facility and the term loan B facility entered into on March 12, 2004 which were repaid with the proceeds of the June 10 Transactions (see adjustment (e)).

(h)		This adjustment eliminates the historical interest and amortization of deferred financings fees on the Eurobonds. €114,990,000 of the €115 million aggregate principal amount of the Eurobonds was repaid with the proceeds of the June 10 Transactions.

(i)		This adjustment reflects interest expense of $6.5 million on the 11 1/2% Senior Secured Notes due 2011 and expense of $0.5 million for the amortization of (i) deferred financing fees related thereto and (ii) original issue discount.

(j)		This adjustment reflects interest expense of $0.2 million and expense of $0.2 million for the amortization of deferred financing fees related to the asset based facility. The interest expense is based upon a weighted average rate of 3.85% per annum and an average draw against the facility of $18.1 million. The asset based facility bears interest, at the company’s option at LIBOR or an ABR, in each case, plus an applicable margin. A change in the interest rate of one-eighth percent (0.125%) per annum would have an effect on interest expense of $22,659.

(k)		The Rights Offering has no effect on the Unaudited Pro Forma Consolidated Statement of Operations other than increasing the number of shares used for calculating earnings per share.

(l)		Weighted average common shares do not include the shares into which the Series B Preferred Stock is convertible because their inclusion would result in a smaller loss per common share. Had these shares been included, weighted average common shares would be higher by 50,000 thousand before the Rights Offering and by 35,000 thousand after the Rights Offering.

The Unaudited Pro Forma Consolidated Statement of Operations for the three months ended March 31, 2004 does not include or give effect to the following nonrecurring charges directly attributable to the Refinancing Transactions:


	(1)	A $6.4 million charge to interest expense to be recorded in the second quarter of 2004 resulting from the write-off of a financial asset related to the Series A Notes. The asset results from a beneficial conversion feature that allowed the holders of the Series A Notes to acquire common shares of the company at an effective conversion price of $1.96 per common share compared to a fair value of $2.40 per common share on March 12, 2004 when the Series A Notes were issued.

	(2)	A $1.5 million charge to refinancing costs to be recorded in the second quarter of 2004 for a prepayment penalty related to the term loan B facility that was entered into on March 12, 2004.

	(3)	A charge to refinancing costs of approximately $6.1 million to be recorded in the second quarter of 2004 related to the 4% tender premium on the Eurobonds and the write off of deferred financing fees related to the Eurobonds.

	(4)	A charge to refinancing costs of $6.3 million to be recorded in the second quarter of 2004 related to (i) the write off of deferred financing fees pertaining to the revolving A facility and term loan B facility and (ii) expense related to the early vesting of 1,090,310 shares of restricted stock due to a change in control provision.

You should read the following discussion in connection with our consolidated financial statements and related notes included elsewhere in this prospectus.

We are a 120-year-old company, headquartered in Cincinnati, Ohio, and focused primarily on manufacturing and selling plastics processing equipment and supplies. We also manufacture and sell industrial fluids for metalworking applications. We operate both businesses on a global basis. With 3,500 employees, we have major manufacturing facilities in the United States, Germany, Italy, Belgium and India, and we maintain sales and service offices in over 100 countries around the world.

We operate in four business segments: Machinery Technologies — North America, Machinery Technologies — Europe, Mold Technologies and Industrial Fluids. Our Machinery Technologies segments manufacture and sell plastics processing equipment, including the three most common types: injection molding, blow molding and extrusion machinery, as well as related tooling, parts and services throughout the world. Our Mold Technologies segment is the leading North American and a leading global supplier of mold bases and components used in the plastics injection molding process. Our Industrial Fluids segment blends and sells metalworking fluids globally for machining, stamping, grinding and cleaning applications.

We have served the plastics processing industries since the late 1960s. Major customers for our plastics technologies are manufacturers of packaging, autos, building materials, industrial components, consumer goods, appliances and housewares, medical devices, and electrical products. The automotive industry is by far the largest customer of our industrial fluids, followed by makers of industrial components and machinery, off-road equipment, appliances and housewares, and aircraft. We have made and sold industrial fluids since the late 1940s.

Global consumption of plastics has grown steadily since the Second World War, as plastics and plastic composites continue to replace traditional materials such as metal, wood, glass and paper in an increasing number of manufactured products, particularly in the packaging, automotive, building materials, consumer goods, housewares, electrical and medical industries. From 1970 to 2002, global consumption of plastics grew at a compounded annual growth rate of 6%, compared with 1% for steel and 3% for aluminum (Source: BASF AG, Association of Plastics Manufacturers in Europe, International Iron & Steel Institute, U.S. Geological Survey).

Plastic part production, like industrial production in general, has historically shown solid, mildly cyclical growth. In every year from 1980 to 2000, plastic part production in the U.S. showed positive year-over-year increases, averaging 7% compound annual growth (Source: U.S. Federal Reserve Board). The increases in plastics consumption and corresponding plastic part production have historically created cyclical but growing demand for our plastics machinery and related supplies. In fact, between 1980 and 2000, our sales of plastics equipment and supplies in North America grew at 8% compounded annually excluding acquisitions or 11% including acquisitions.

In the 1990s, like many other U.S. companies, we benefited from a strong, growing economy. Our plastics technologies sales were approaching $1 billion with good profitability. In 2000, for example, on sales of $874 million, our plastics technologies businesses generated over $125 million in operating earnings before depreciation and amortization and approximately $97 million in operating earnings. However, beginning in late 2000 through the third quarter of 2003, the U.S. manufacturing sector experienced the most severe and prolonged downturn since the 1930s. U.S. industrial production, a key indicator of demand for our products, fell 6% from June, 2000 to June, 2003, a much steeper and longer decline than 4% in the prior downturn from June, 1990 to March, 1991 (Source: U.S. Federal Reserve Board). The plastics processing portion of the

manufacturing sector was very severely impacted. As plastic part production slowed, capacity utilization rates of our customers, U.S. plastics processors, dropped from the previous peak of 86% to a low of 77% (Source: U.S. Federal Reserve Board), and shipments of injection molding machines in North America fell over 40% from a peak of approximately $1.2 billion 12-month moving total in 2000 to under $700 million by the end of 2001 and through 2003 (Source: The Society of Plastics Industry).

During this deep recession in North America, with both European and Asian markets also in decline, albeit more modestly, demand for many of our plastics machinery lines declined by 40% to 50% or more, and our total global plastics technologies sales fell 27%. Despite a series of responsive actions, including a number of plant closings, head-count reductions and a lowering of fixed costs by over $60 million annually, the sales volume declines resulted in three loss years in 2001, 2002 and 2003.

Manufacturing in North America started to recover in the fourth quarter of 2003 when total U.S. manufacturing orders finally returned to their previous peak levels of 2000. And in January 2004, the Institute for Supply Management’s manufacturing index, traditionally a very strong leading indicator, rose to its highest level in twenty years. In the plastics sector, U.S. processors’ capacity utilization reached 81% for the first time since late 2000.

Historically, our experience has been that demand for machinery begins to grow two or three quarters after a pickup in production, when capacity utilization rates exceed 84%. In short, our customers need to return to sustained profitability before they can afford to significantly increase their investment in new equipment. So, while demand for our plastics machinery remained at depressed levels through the end of 2003, we are encouraged by recent economic developments and expect to benefit from a recovery in our plastics technologies businesses over time.

During the manufacturing recession of 2000-2003, overall demand for our metalworking fluids declined by about 10%, as our largest customer group, automakers, maintained reasonably good levels of production both in North America and worldwide. Profitability in this business, though impacted by lower sales volumes, held up fairly well throughout the recession, with earnings before interest and taxes in the range of 15% to 20% of sales.

Our most important accomplishment in the first quarter of 2004 was the refinancing of approximately $200 million of debt and other obligations that were maturing in the quarter. Specifically, we entered into an agreement with Glencore and Mizuho whereby they jointly provided us with $100 million in new capital in the form of exchangeable securities. This new capital, together with existing cash balances, was used to repay our outstanding $115 million in senior U.S. notes. In addition, we also reached a separate agreement with Credit Suisse First Boston for a $140 million credit facility consisting of a $65 million revolving facility and a $75 million term loan facility. At close, $84 million of this new facility was drawn to retire our previous revolving bank credit facility and to terminate our receivables purchase program.

When we released our first quarter results on April 26, 2004, we also announced the second step in our plan to revitalize our capital structure: our intention to refinance the $75 million term loan with Credit Suisse First Boston and to retire our €115 million in Eurobonds due in 2005. The following day, April 27, we launched a tender offer for the Eurobonds. We repaid in full all outstanding loans and terminated all commitments under the credit facility with Credit Suisse First Boston on June 10, 2004 in connection with our issuance of the original notes and the establishment of a $75 million asset based credit facility with JPMorgan Chase Bank as administrative agent and collateral agent. The tender offer for the Eurobonds expired on June 7, 2004 with 99.99% of the Eurobonds validly tendered, accepted and not withdrawn. The tendered Eurobonds were repaid on June 10, 2004.

We posted a net loss on sales roughly comparable to those of the first quarter a year ago. Our sales in 2004 were $189 million compared to $190 million in 2003 and were within the range of guidance we had issued in February. Absent favorable currency effects, however, sales would have decreased by 6% due in large part to uncertainties regarding our refinancing plans that were not announced until near the end of the quarter. Our segment earnings and primary working capital changes were also within the range of our guidance. During the quarter we experienced improving operating efficiencies as a result of restructuring actions taken in 2003 and our ongoing implementation of Lean manufacturing techniques.

Sales and new orders in 2003 were approximately even with those of 2002 after excluding currency translation effects, as the manufacturing recession continued in North America through the first three quarters of the year. Our net loss in 2003 was $192 million and included two noncash charges — a $66 million charge for goodwill impairment and a $71 million tax provision to establish valuation allowances against a portion of our deferred tax credits — as well as $27 million in restructuring costs.

Entering 2004 there are many positive developments bolstering our prospects for improved operating results as well as a number of challenges and risks. In the fourth quarter of 2003 there was a noticeable pickup in industrial production in general and in the plastics processing industries in particular, a sign that an economic recovery in North America might be taking hold. The economic outlook for Europe appears positive and the Asian markets are projected to show continued strong growth, especially in China, where we are working hard to expand our presence. While we expect a pickup in our machinery businesses to lag the overall recovery by two quarters or more, our non-machinery businesses — currently representing over 50% of total sales, should benefit more immediately. We believe we are well positioned to expand our share in the higher-margin aftermarket sales and services sectors of the business. Internally we continue to implement Lean manufacturing techniques and other efficiency measures to improve our profitability and cash flow. Finally, the weakening of the U.S. dollar and the strengthening of the euro in 2003 should be competitively advantageous to our U.S.-built products in the long run.

Although we ended the year with $93 million of cash, the biggest challenge we faced going into 2004 was the refinancing of our debt, as our revolving credit agreement and our receivables securitization program were both due to expire and $115 million of senior unsecured notes were due to mature — all in the first quarter. However, on March 12, 2004, we entered into two new financing arrangements that enabled us to repay these obligations by their scheduled maturity dates. These refinancing arrangements are discussed in depth in “Liquidity and Sources of Capital — March 12 Transactions.”

The biggest risk we still face is the possibility of a stall or setback in the economic recovery of the manufacturing sector in North America, perhaps as a result of geopolitical instability and/or rising energy prices.

As described more fully in the Notes to Consolidated Financial Statements, in the years 2001 through 2003 we completed a total of five acquisitions of smaller companies that are now included in our plastics technologies segments. The most significant were the 2001 acquisitions of Reform Flachstahl (Reform) and EOC Normalien (EOC), two businesses headquartered in Germany that manufacture and distribute mold bases and components for injection molding. In the aggregate, the five newly acquired businesses had annual sales of approximately $63 million as of the respective acquisition dates. In 2003, we also purchased the remaining 25% of the shares of a consolidated subsidiary in Canada that also manufactures mold bases and components.

Beginning with the acquisition of Ferromatik in 1993, we have significantly expanded our presence outside the U.S. and have become more globally balanced. For 2003, markets outside the U.S. represented the following percentages of our consolidated sales: Europe 29%; Canada and Mexico 7%; Asia 7%; and the rest of the world 3%. As a result of this geographic mix, foreign currency exchange rate fluctuations affect the translation of our sales and earnings, as well as consolidated shareholders’ equity. During the first quarter of 2004, the weighted-average exchange rate of the euro was stronger in relation to the U.S. dollar than in the comparable period of 2003. As a result, we experienced favorable currency translation effects on sales and new orders of approximately $10 million and $9 million, respectively. The effect on earnings was not significant. During 2003, the weighted-average exchange rate of the euro was stronger in relation to the U.S. dollar than in 2002. As a result, we experienced favorable currency translation effects on new orders and sales of $40 million and $39 million, respectively. The effect on earnings was not material.

Between December 31, 2002 and December 31, 2003, the euro strengthened against the dollar by approximately 21% which caused the majority of a $9 million favorable adjustment to consolidated shareholders’ equity. Between December 31, 2003 and March 31, 2004, the euro weakened against the U.S. dollar by approximately 2%. If the euro should weaken further against the U.S. dollar in future periods, we could experience a negative effect in translating our non-U.S. sales, orders and earnings when compared to historical results.

The Consolidated Financial Statements discussed herein have been prepared in accordance with generally accepted accounting principles in the United States, which require management to make estimates and assumptions that affect the amounts that are included therein. The following is a summary of certain accounting policies, estimates and judgmental matters that management believes are significant to our reported financial position and results of operations. Additional accounting policies are described in the note captioned “Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements in this prospectus, which should be read in connection with the discussion that follows. Management regularly reviews its estimates and judgments and the assumptions regarding future events and economic conditions that serve as their basis. While management believes that the estimates used in the preparation of the Consolidated Financial Statements are reasonable in the circumstances, the recorded amounts could vary under different conditions or assumptions.

At December 31, 2003, we had significant deferred tax assets related to U.S. and non-U.S. net operating loss and tax credit carryforwards and to charges that have been deducted for financial reporting purposes but which are not yet deductible for income tax reporting. These charges include the writedown of goodwill and a charge to equity related to minimum pension funding. At December 31, 2003, we have provided valuation allowances against some of the deferred tax assets. Valuation allowances serve to reduce the recorded deferred tax assets to amounts reasonably expected to be realized in the future. The establishment of valuation allowances and their subsequent adjustment requires a significant amount of judgment because expectations as to the realization of deferred tax assets — particularly those assets related to net operating loss carryforwards — are generally contingent on the generation of taxable income, the reversal of deferred tax liabilities in the future and the availability of qualified tax planning strategies. In determining the need for valuation allowances, management considers its short-term and long-range internal operating plans, which are based on the current economic conditions in the countries in which we operate, and the effect of potential economic changes on our various operations.

At December 31, 2003, we had non-U.S. net operating loss carryforwards — principally in The Netherlands, Germany and Italy — totaling $190 million and related deferred tax assets of $61 million. Valuation allowances totaling $51 million had been provided with respect to these assets as of that date. Management believes that it is more likely than not that portions of the net operating loss carryforwards in

At June 30, 2003, however, management determined that valuation allowances were required for at least a portion of the U.S. deferred tax assets. This conclusion was based on the expectation that a recovery in the U.S. plastics industry and our return to profitability in the U.S. would be delayed longer than originally expected. As a result of these delays and the incremental costs of the restructuring initiatives announced in the third quarter of 2003, we expected to incur a cumulative operating loss in the U.S. for the three-year period ending December 31, 2003. In such situations, accounting principles generally accepted in the U.S. include a presumption that expectations of earnings in the future cannot be considered in assessing the need for valuation allowances. Accordingly, a charge to the tax provision of approximately $71 million was recorded in the second quarter of 2003 to establish valuation allowances with respect to a portion of our U.S. deferred tax assets for which future income was previously assumed.

U.S. deferred tax assets and valuation allowances were both increased by an additional $6 million in the first quarter of 2004. As a result, no U.S. tax benefit was recorded with respect to the loss incurred for the quarter. The provision for income taxes for the quarter relates to operations in profitable non-U.S. jurisdictions.

Our internal accounting policies require that each of our operations maintain appropriate reserves for uncollectible receivables, inventory obsolescence and warranty costs in accordance with generally accepted accounting principles. Because of the diversity of our customers and product lines, the specific procedures used to calculate these reserves vary by location but in all cases must conform to our company guidelines. Reserves are required to be reviewed and adjusted as necessary on a quarterly basis.

Allowances for doubtful accounts are generally established using specific percentages of the gross receivable amounts based on their age as of a particular balance sheet date. The amounts calculated through this process are then adjusted for known credit risks and collection problems. Write-offs of accounts receivable for our continuing operations have averaged $2.8 million during the last three years. While management believes that our reserves for doubtful accounts are reasonable in the circumstances, adverse changes in general economic conditions or in the financial condition of our major customers could result in the need for additional reserves in the future.

Reserves for inventory obsolescence are generally calculated by applying specific percentages to inventory carrying values based on the level of usage and sales in recent years. These calculations are then adjusted based on current economic trends, expected product line changes, changes in customer requirements and other factors. In 2003, our continuing operations recorded new inventory obsolescence reserves totaling $5.4 million and utilized $5.3 million of such reserves in connection with the disposal of obsolete inventory. Management believes that our reserves are appropriate in light of our historical results and our assumptions regarding the future. However, adverse economic changes or changes in customer requirements could necessitate the recording of additional reserves through charges to earnings in the future.

Our warranty reserves are of two types — “normal” and “extraordinary.” Normal warranty reserves are intended to cover routine costs associated with the repair or replacement of products sold in the ordinary course of business during the warranty period. These reserves are accrued using a percentage-of-sales approach based on the ratio of actual warranty costs over a representative number of years to sales revenues from products sold with warranties over the same period. The percentages are required to be reviewed and adjusted as necessary at least annually. Extraordinary warranty reserves are intended to cover major problems related to a single machine or customer order or to problems related to a large number of machines or other type of product. These reserves are intended to cover the estimated costs of resolving the problems based on all relevant facts and circumstances. In recent years, costs related to extraordinary warranty problems have not been significant. In 2003, our continuing operations accrued warranty reserves totaling $4.9 million and incurred warranty-related costs totaling $3.0 million. While management believes that our warranty reserves are adequate in the circumstances, unforeseen problems related to unexpired warranty obligations could result in a requirement for additional reserves in the future.

In years prior to 2002, we reviewed the carrying value of goodwill annually using estimated undiscounted future cash flows. Using this approach in 2001, the maximum period of time to recover the carrying value of recorded goodwill through undiscounted cash flows was determined to be approximately 12 years and the weighted-average recovery period was approximately 18% of the average remaining amortization period. However, effective January 1, 2002 we adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets” (SFAS No. 142), which requires that goodwill be tested for impairment using probability-weighted cash flows discounted at market interest rates. The change from undiscounted to discounted cash flows resulted in a pretax goodwill impairment charge of $247.5 million

SFAS No. 142 requires that goodwill be tested for impairment annually or whenever certain indicators of impairment are determined to be present. We conducted our first annual review of goodwill balances as of October 1, 2002. This review resulted in a pretax goodwill impairment charge related to the mold technologies segment of $1.0 million (with no tax benefit) that was recorded in the fourth quarter. In the third quarter of 2003, we tested the goodwill of two businesses included in the mold technologies segment for impairment due to the presence of certain indicators of impairment. This review resulted in a preliminary goodwill impairment charge of $52.3 million that was recorded in the third quarter and subsequently adjusted to $65.6 million in the fourth quarter after the completion of the independent appraisals of certain tangible and intangible assets that are required to determine their fair values. The charge resulted from a downward adjustment of the future cash flows expected to be generated by the businesses due to a delay in the general economic recovery in both North America and Europe. The largest decrease in cash flow expectations related to our European mold base and components business due to continued weakness in the markets it serves.

Our annual review of goodwill impairment as of October 1, 2003 did not result in additional impairment charges.

We currently review the carrying values of our long-lived assets other than goodwill annually. These reviews are conducted by comparing the estimates of undiscounted future cash flows that are included in our long-range internal operating plans to the carrying values of the related assets. No growth in operating cash flows beyond the third year is assumed. Under this methodology, impairment would be deemed to exist if the carrying values exceeded the expected future cash flow amounts. In 2003, we reviewed the aggregate carrying values of selected groups of our long-lived assets under the provisions of Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” The assets included in these reviews consisted principally of property, plant and equipment and, where applicable, intangible assets other than goodwill. Based on these reviews, it was determined that the maximum period of time to recover the carrying values of the tested groups of assets through undiscounted cash flows is approximately 8 years and that the weighted-average recovery period is approximately 20% of the remaining average lives of the assets. Based on the results of the reviews, no impairment charges were recorded in 2003.

Through our wholly-owned insurance subsidiary, Milacron Assurance Ltd. (MAL), we are primarily self-insured for many types of risks, including general liability, product liability, environmental claims and worker’s compensation for certain domestic employees. MAL, which is incorporated in Bermuda and is subject to the insurance laws and regulations of that jurisdiction, establishes reserves commensurate with known or estimated exposures under the policies it issues to us. Exposure for general and product liability claims is supplemented by reinsurance coverage in some cases and by excess liability coverage in all policy years. Worker’s compensation claims in excess of certain limits are insured with commercial carriers. At December 31, 2003, MAL had reserves for known claims and incurred but not reported claims under all coverages totaling approximately $22.9 million. The majority of this amount is included in long-term accrued liabilities in the Consolidated Balance Sheet at that date.

MAL’s reserves are established based on known claims, including those arising from litigation, and management’s best estimates of the ultimate exposures thereunder (after consideration of excess carriers’ liabilities) and on estimates of the cost of incurred but not reported claims. For certain types of exposures, MAL and the company utilize actuarially calculated estimates prepared by outside consultants to ensure the adequacy of the reserves. Reserves are reviewed and adjusted quarterly based on all evidence available as of the respective balance sheet dates. While the ultimate amount of MAL’s exposure to claims is dependent on future events that cannot be predicted with certainty, management believes that the recorded reserves are adequate in the circumstances. However, claims in excess of the recorded amounts could adversely affect earnings in the future when additional information becomes available.

We maintain defined benefit and defined contribution pension plans that provide retirement benefits to substantially all U.S. employees and certain non-U.S. employees. The most significant of these plans is the principal defined benefit plan for certain U.S. employees, which is also the only defined benefit plan that is funded. Excluding charges of $4.7 million for temporary supplemental retirement benefits that were offered in connection with restructuring actions, we recorded pension income of $9.4 million related to this plan in 2002. In 2003, however, pension income decreased to $0.6 million, once again excluding charges for supplemental benefits of $3.2 million. Moreover, we currently expect to record pension expense related to this plan of approximately $7 million in 2004. Pension expense for 2005 and beyond is dependent on a number of factors including returns on plan assets and changes in the plan’s discount rate and therefore cannot be predicted with certainty at this time. The following paragraphs discuss the significant factors that affect the amount of recorded pension income or expense and the reasons for the reductions in income identified above.

A significant factor in determining the amount of income recorded for the funded U.S. plan is the expected long-term rate of return on plan assets. In 2002 and in several preceding years, we used an expected long-term rate of return of 9 1/2%. However, we began using a rate of return of 9% beginning in 2003 and will continue to do so in 2004. We develop the long-term rate of return assumption based on the current mix of equity and debt securities included in the plan’s assets and on the historical returns on those types of investments, judgmentally adjusted to reflect current expectations of future returns. In evaluating future returns on equity securities, the existing portfolio is stratified to separately consider large and small capitalization investments, as well as international securities. The change from the 9 1/2% rate of return assumption to the lower 9% rate had the effect of reducing the amount of pension income that would otherwise be reportable in 2003 by more than $2 million.

In determining the amount of pension income or expense to be recognized, the expected long-term rate of return is applied to a calculated value of plan assets that recognizes changes in fair value over a three-year period. This practice is intended to reduce year-to-year volatility in recorded pension income or expense but it can have the effect of delaying the recognition of differences between actual returns on assets and expected returns based on the long-term rate-of-return assumption. At December 31, 2003, the market value of our pension assets was $371 million whereas the calculated value of these assets was $389 million. The difference arises because the latter amount includes two-thirds of the asset-related loss incurred in 2002 but only one-third of the gain realized in 2003. If significant asset-related losses are incurred in 2004, it will have the effect of increasing the amount of pension expense to be recognized in future years beginning in 2005.

In addition to the expected rate of return on plan assets, recorded pension income or expense includes the effects of service cost — the actuarial cost of benefits earned during a period — and interest on the plan’s liabilities to participants. These amounts are determined actuarially based on current discount rates and assumptions regarding matters such as future salary increases and mortality. Differences in actual experience in relation to these assumptions are generally not recognized immediately but rather are deferred together with asset-related gains or losses. When cumulative asset-related and liability-related gains or losses exceed the greater of 10% of total liabilities or the calculated value of plan assets, the excess is amortized and included in pension income or expense. At December 31, 2001, the discount rate used to value the liabilities of the principal U.S. plan was reduced from 7 3/4% to 7 1/4%. The rate was further lowered to 6 1/2% at December 31, 2002 and to 6 1/4% at December 31, 2003. The combined effects of these changes and the variances in relation to the long-term rate of return assumption discussed above have resulted in cumulative losses in excess of the 10% corridor. Amortization of these losses adversely affected pension expense in 2003 by almost $3 million. Expense for amortization of previously unrecognized losses is expected to be in excess of $6 million in 2004.

Additional changes in the key assumptions discussed above would affect the amount of pension expense currently expected to be recorded for years subsequent to 2004. Specifically, a one-half percent increase in the rate of return on assets assumption would have the effect of decreasing pension expense by approximately $2 million. A comparable decrease in this assumption would have the opposite effect. In addition, a one-quarter percent increase or decrease in the discount rate would decrease or increase expense by approximately $0.8 million.

In an effort to help readers better understand the composition of our operating results, certain of the discussions that follow include references to restructuring costs. Accordingly, those discussions should be read in connection with (i) the tables under the caption “Comparative Operating Results,” (ii) the Consolidated Condensed Financial Statements and notes thereto that are included in this prospectus and (iii) the Consolidated Financial Statements and notes thereto that are included in this prospectus.

As discussed more fully in the Notes to Consolidated Financial Statements, in the third quarter of 2002 we completed the sales of our Valenite, Widia and Werkö metalcutting tools businesses and began to explore strategic alternatives for the sale of our round metalcutting tools and grinding wheels businesses. The round metalcutting tools business was sold in two separate transactions in the third quarter of 2003, and the grinding wheels business was sold on April 30, 2004. All of these businesses are reported as discontinued operations in the Consolidated Financial Statements and the Consolidated Condensed Financial Statements. The comparisons of results of operations that follow exclude these businesses and relate solely to our continuing operations unless otherwise indicated.

In 2002 and prior years, we recorded significant amounts of income related to our defined benefit pension plan for certain U.S. employees. For all of 2002, results of continuing operations included income of $7.6 million related to this plan. However, because of a significant decrease in the value of the plan’s assets and changes in the rate of return on assets and discount rate assumptions, pension income related to continuing operations decreased to $0.5 million in 2003. For 2004, we currently expect to record pension expense of approximately $7 million, substantially all of which will be charged to continuing operations. See “Significant Accounting Policies and Judgments — Pensions.” As discussed further below, the fluctuation between years has negatively affected margins, selling and administrative expense and earnings.

Three Months Ended March 31, 2004 Compared to Three Months Ended March 31, 2003

In the first quarters of both 2004 and 2003, consolidated new orders totaled $187 million. Consolidated sales were $189 million in 2004, virtually unchanged from $190 million in 2003. In 2004, new orders and sales benefited from favorable currency effects of $9 million and $10 million, respectively. Absent these effects, new orders and sales would have decreased by 5% and 6%, respectively. Order and shipment levels were penalized by a number of factors, including uncertainties regarding our refinancing plans and continued low levels of capital spending for plastics processing machinery in North America.

Export orders were $17 million in the first quarter of 2004 compared to $18 million in 2003. Export sales totaled $19 million in 2004 and $18 million in 2003. Sales of all segments to non-U.S. markets, including exports, totaled $92 million in the first quarter of 2004 compared to $80 million in 2003 with the increase being due principally to favorable foreign currency translation effects. For the first quarters of 2004 and 2003,

Our backlog of unfilled orders at March 31, 2004 was $90 million compared to $92 million at December 31, 2003 and $75 million at March 31, 2003.

The consolidated manufacturing margin was 17.4% in the first quarter of 2004 compared to 16.7% in the first quarter of 2003. Margins remained low in relation to historical levels due to reduced sales volume and the related underabsorption of manufacturing costs and were penalized by higher insurance costs but benefited from our recent restructuring initiatives and process improvements. The margin improvement was achieved despite an increase in pension expense included in cost of products sold from $0.2 million in 2003 to $1.2 million in 2004.

Total selling and administrative expense increased modestly in dollar amount in the first quarter of 2004 due principally to currency effects and $0.4 million of incremental pension expense. As a percentage of sales, selling expense increased from 12.6% to 13.1%. Administrative expense was essentially unchanged as the benefits of our cost-cutting initiatives were offset by currency effects.

Interest expense increased from $5.2 million in the first quarter of 2003 to $7.9 million in the comparable period of 2004. The increase was due principally to higher borrowing costs (including amortization of deferred financing fees) related to the new financing arrangements entered into on March 12, 2004 (which are described in detail in the Liquidity and Sources of Capital section that follows). Currency effects and reduced allocation of interest cost to discontinued operations also contributed to the increase.

During the first quarter of 2004, we charged to expense $6.4 million of refinancing costs incurred in pursuing various alternatives to the March 12, 2004 refinancing of approximately $200 million in debt and other obligations. Our refinancing costs for the second quarter will be approximately $15 million, including the tender premium and costs related to the tender offer for the 7 5/8% Eurobonds due 2005 and the write-off of the remaining deferred financing fees related thereto. The second quarter costs will also include (i) the write-off of deferred financing fees related to the credit facility entered into with Credit Suisse First Boston on March 12, 2004 and a prepayment penalty related to the facility and (ii) expense related to the early vesting of 1,090,310 shares of restricted stock due to a change in control provision.

As discussed more fully in the Notes to Consolidated Condensed Financial Statements, in November 2002, we announced additional restructuring initiatives intended to improve operating efficiency and customer service. One of these actions involved the transfer of all manufacture of container blow molding machines and structural foam systems from the plant in Manchester, Michigan to our more modern and efficient facility near Cincinnati, Ohio. The mold making operation has also been moved to a smaller, more cost-effective location near Manchester. In another action, the manufacture of special mold bases for injection molding at the Monterey Park, California plant was discontinued and transferred to other facilities in North America.

Early in 2003, we initiated a plan for the further restructuring of our European blow molding machinery operations, including the discontinuation of the manufacture of certain product lines at the Magenta, Italy plant. The restructuring has resulted in the elimination of approximately 35 positions at Magenta and restructuring expense of $4.0 million. Cash cost will total approximately $0.9 million, a large majority of which was spent in 2003.

In the third quarter of 2003, we began to implement additional restructuring initiatives that focus on further overhead cost reductions in each of our plastics technologies segments and at the corporate office. These actions, which involved the relocation of production, closure of sales offices, voluntary early retirement programs and general overhead reductions, have resulted in the elimination of approximately 300 positions

The total annualized cost savings from all of the 2002 and 2003 actions that are discussed above is expected to be approximately $32 million. A portion of this amount was realized in 2003 and an incremental $20 million of savings is expected to be realized in 2004. Of the $32 million of cost savings, approximately $7 million (which includes savings related to corporate costs) was realized in the first quarter of 2004. Including actions that were initiated in 2001, the pretax cost savings we expect to realize in 2004 will be $69 million.

In total, the actions initiated in 2002 and 2003 that are discussed above resulted in pretax restructuring costs of $5.5 million in the first quarter of 2003 and $1.1 million in the comparable period of 2004. Cash costs totaled $4.1 million in the first quarter of 2003 and $3.2 million in 2004. For the first quarter of 2003, restructuring costs also include $0.5 million related to the integration of EOC and Reform, two businesses acquired in 2001, with our existing mold base and components business in Europe.

The following sections discuss the operating results of our business segments which are presented in tabular form in the Notes to Consolidated Condensed Financial Statements in this prospectus.

Machinery Technologies — North America — The machinery technologies — North America segment had new orders of $79 million in the first quarter of 2004, a decrease of $6 million, or 7%, in relation to orders of $85 million in 2003. Sales totaled $77 million and $88 million in the first quarters of 2004 and 2003, respectively. Uncertainties regarding our refinancing plans that were not announced until March 12 had a negative effect on orders and shipments for much of the quarter. In both years, depressed capital spending in the U.S. plastics processing industry also kept orders and shipments at low levels in comparison to pre-recession levels. Capacity utilization in the plastics processing industry increased in the fourth quarter of 2003 and in the first quarter of 2004 but based on historical trends, significant increases in capital spending can be expected to trail increases in capacity utilization by 2 to 3 quarters. Due to lower shipment levels, higher insurance costs, continued price discounting and a $1.3 million increase in pension expense, the segment had an operating loss excluding restructuring costs of $0.6 million in 2004 compared to earnings excluding restructuring costs of $2.1 million in 2003. The decrease occurred despite incremental benefits of $2 million related to the restructuring and cost-cutting initiatives that were undertaken in 2002 and 2003. The segment’s restructuring costs totaled $0.8 million in 2004 and $2.8 million in 2003.

Machinery Technologies — Europe — The machinery technologies — Europe segment had new orders and sales of $40 million and $43 million, respectively, in the first quarter of 2004 compared to new orders and sales of $33 million and $35 million, respectively, in 2003. Currency effects contributed approximately $5 million of incremental sales and new orders in 2004. However, orders and sales also increased as measured in local currencies for both injection molding machines and blow molding systems. The restructuring actions begun in 2003 resulted in more than $1 million of savings in 2004 in relation to the first quarter of 2003. As a result of the restructuring actions, the segment had an operating profit of $1.1 million in the first quarter of 2004 compared to a loss of $0.7 million in 2003. Both amounts exclude restructuring costs of $0.1 million in 2004 and $2.2 million in 2003.

Mold Technologies — Despite favorable currency effects of $2 million, new orders in the mold technologies segment decreased from $45 million in the first quarter of 2003 to $43 million in 2004. Sales also decreased from $45 million to $43 million despite $2 million of favorable currency effects. Orders and sales in North America were essentially flat in relation to 2003 but declined in Europe. Despite lower sales volume, the segment had an operating profit of $1.4 million in the first quarter of 2004 compared to earnings of $0.3 million in 2003, in both cases excluding restructuring costs which were $0.2 million in 2004 and $1.0 million in 2003. The improvement in 2004 was due in large part to the benefits derived from these restructuring actions which totaled more than $3 million.

Industrial Fluids — The industrial fluids segment had new orders and sales of $26 million each in the first quarter of 2004 compared to $25 million in 2003 with the increases being due entirely to favorable currency effects. The segment’s operating profit was $2.5 million in 2004 compared to $3.5 million in 2003. The reduction in profitability was due principally to higher pension and insurance costs.

Our pretax loss for the first quarter of 2004 was $14.9 million which includes refinancing costs of $6.4 million and restructuring costs of $1.1 million. In the comparable period of 2003, our pretax loss was $10.3 million which includes restructuring costs of $6.0 million. The pretax loss for 2004 includes incremental savings of $7 million from the 2003 restructuring actions, partially offset by expense related to the principal pension plan for U.S. employees of $1.6 million. In 2003, pension expense related to this plan was $0.2 million.

As was previously discussed (see Significant Accounting Policies and Judgments — Deferred Tax Assets and Valuation Allowances), we recorded a $71 million charge to the second quarter of 2003 provision for income taxes to establish valuation allowances against a portion of our U.S. deferred tax assets. Additional deferred tax assets and valuation allowances were recorded in the second half of the year. Due to the geographic mix of earnings, results for the first quarter of 2004 include expense related to operations in profitable non-U.S. jurisdictions. This resulted in a first quarter provision for income taxes of $1.1 million despite a pretax loss of $14.9 million in 2004. In the first quarter of 2003, the effective tax benefit rate was 26%. This effective rate is less than the U.S. federal statutory rate adjusted for state and local income losses due to the establishment of valuation allowances related to loss carryforwards in certain non-U.S. jurisdictions.

Our loss from continuing operations in the first quarter of 2004 was $16.0 million, or $0.47 per share, compared to a loss of $7.6 million, or $0.23 per share, in 2003. The loss for 2004 includes refinancing costs of $6.4 million and restructuring costs of $1.1 million, in both cases, with no tax benefit. The amount for 2003 includes after-tax restructuring costs of $4.8 million.

In 2004, the loss from discontinued operations represents the operating results of our grinding wheels business. In 2003, the loss from discontinued operations includes the grinding wheels business as well as the round metalcutting tools business. The divestiture of the round tools business was completed in the third quarter of 2003 and the grinding wheels business was sold on April 30, 2004.

Including refinancing costs, restructuring costs and the results of discontinued operations, we had a net loss of $16.6 million, or $0.49 per share, in the first quarter of 2004. In the first quarter of 2003, we had a net loss including restructuring costs and discontinued operations of $8.3 million, or $0.25 per share.

Consolidated new orders totaled $747 million in 2003 compared to $703 million in 2002. Currency translation effects resulting principally from the strength of the euro in relation to the U.S. dollar contributed substantially all of the $44 million increase. Consolidated sales increased from $693 million in 2002 to $740 million in 2003. As was the case with new orders, translation effects contributed most of the increase. Order and shipment levels showed improvement in the fourth quarter but continued to be penalized by low levels of industrial production in the U.S. and capital spending in the plastics processing industry.

Export orders totaled $73 million in 2003, an increase of $7 million from $66 million in 2002. Export sales increased from $71 million in 2002 to $73 million in 2003. Both increases related principally to higher export sales of U.S.-built blow molding systems. Total sales of all segments to non-U.S. markets, including exports, were $338 million, or 46% of consolidated sales, in 2003 compared to $296 million, or 43% of sales, in 2002. Sales of goods manufactured outside the U.S. totaled 41% in 2003 compared to 38% in 2002. The strength of the euro in relation to the dollar was a significant factor in both increases.

Our backlog of unfilled orders was $92 million at December 31, 2003 compared to $76 million at December 31, 2002. The increase reflects higher order levels for blow molding systems in the U.S. and injection molding machinery in Europe.

Including $3.3 million of restructuring costs related to product line discontinuation, the consolidated manufacturing margin was 17.7% in 2003. Excluding restructuring costs, the consolidated margin was 18.2%. In 2002, the consolidated manufacturing margin, including $1.9 million of restructuring costs, was 17.3%. Excluding restructuring costs, the 2002 margin was 17.5%. Margins remained low in relation to pre-recession historical levels due to reduced sales volume and the related underabsorption of manufacturing costs. Margins were also penalized by increased pricing pressure for plastics processing machinery in both North America and Europe and a $5.0 million decrease from 2002 in the amount of pension income included in the cost of products sold. However, margins benefited from the effects of our process improvement initiatives and our recent restructuring actions.

Total selling and administrative expense was $129 million in 2003 compared to $121 million in 2002. Selling expense increased from $93 million, or 13.4% of sales, in 2002 to $104 million, or 14.0% of sales, in 2003 due principally to variable selling costs associated with higher sales volume, increased bad debt expense and a $2.0 million reduction in pension income. Costs associated with the triennial National Plastics Exposition that was held in June of 2003 and currency effects also contributed to the increase in selling expense. Conversely, administrative expense decreased by more than $2 million due principally to the effects of our restructuring actions and cost containment efforts despite almost $2 million in adverse currency effects.

Other expense — net increased from income of $1.0 million in 2002 to expense of $1.5 million in 2003. The amount for 2003 includes income of $3.5 million from the settlement of warranty claims against a supplier and $.9 million of income from the licensing of patented technology. The 2002 amount includes income of $4.5 million from technology licensing.

As discussed more fully in the Notes to Consolidated Financial Statements, in 2002 and 2003 we announced additional restructuring initiatives intended to further reduce our cost structure as well as to improve operating efficiency and customer service. In the aggregate, these actions will ultimately result in the elimination of approximately 500 positions worldwide. Cost savings related to these actions were in excess of $15 million in 2003. On an annualized basis, the savings are expected to be in excess of $35 million in 2004 and beyond. This is in addition to the savings we realized from the restructuring actions that were initiated in 2001.

In the fourth quarter of 2002, we initiated the transfer of all manufacture of container blow molding machines and structural foam systems from the plant in Manchester, Michigan to our facility near Cincinnati, Ohio. The mold making operation has also been moved to a smaller, more cost-effective location near Manchester. In another action, the manufacture of special mold bases for injection molding at the Monterey Park, California plant was discontinued and transferred to other facilities in North America.

Early in 2003, we initiated a plan for the further restructuring of our European blow molding machinery operations, including the discontinuation of the manufacture of certain product lines at the Magenta, Italy plant. In the second quarter of 2003, we initiated a plan to close the special mold base machining operation in Mahlberg, Germany and relocate a portion of its manufacturing to another facility. Certain other production is

being outsourced. In the third quarter of 2003, we began to implement additional restructuring initiatives that focus on further overhead cost reductions in each of our plastics technologies segments and at our corporate office. These actions involve the relocation of production, closure of sales offices, voluntary early retirement programs and general overhead reductions.

In 2003 and 2002, restructuring costs also include amounts for the integration of EOC and Reform, two businesses acquired in 2001, with our existing mold base and components business in Europe and costs associated with initiatives announced in 2001 and 2002 to consolidate manufacturing operations and reduce our cost structure.

The costs and related cash effects of the actions described above are summarized in the table that follows.

The table that follows depicts the cost savings realized in 2002 and 2003 from the restructuring actions discussed above and the incremental savings of approximately $20 million that are expected to be realized in 2004.

In 2003, we recorded a goodwill impairment charge of $65.6 million (with no tax benefit) to adjust the carrying value of the goodwill of two businesses included in the mold technologies segment. The charge was calculated by discounting estimated future cash flows and resulted from a downward adjustment of the cash flows expected to be generated by these businesses due to the delay in the general economic recovery in both North America and Europe. The largest decrease in cash flow expectations related to our European mold base and components business due to continued weakness in the markets it serves.

The following sections discuss the operating results of our business segments which are presented in tabular form in the Notes to Consolidated Financial Statements in this prospectus. As presented, segment operating profit or loss excludes restructuring costs and goodwill impairment charges.

Machinery technologies — North America — New orders in the machinery technologies — North America segment were $325 million compared to $321 million in 2002. The segment’s sales also increased modestly from $314 million in 2002 to $321 million in 2003. Despite signs of increased capacity utilization in U.S. plastics processing industries in the fourth quarter, orders and shipments remained at low levels for the third consecutive year due to depressed capital spending by our customers. In addition, the segment’s results were penalized by weaker price realization and reduced pension income but benefited from our restructuring and cost reduction initiatives. Excluding restructuring costs, the segment had operating earnings of $6.7 million in 2003 compared to $8.0 million in 2002. The decrease was due entirely to a $6.1 million reduction in pension income and the absence of $4.5 million of royalty income from the licensing of patented technology that was received in 2002. Restructuring costs for the segment were $7.7 million in 2003 and $6.7 million in 2002. In both years, most of these costs related to the relocation of the North American blow molding systems business and to supplemental retirement benefits offered for the purpose of reducing the cost structure of the segment’s injection molding and extrusion machinery businesses. The restructuring actions initiated in 2002 and 2003 resulted in cost savings in excess of $8 million in 2003 and are expected to produce savings of almost $14 million in 2004. Including the actions that began in 2001, the segment’s savings in 2004 are expected to be almost $34 million.

Machinery technologies — Europe — The machinery technologies — Europe segment had new orders of $154 million and sales of $151 million in 2003 compared to orders of $122 million and sales of $117 million in 2002. Currency translation effects related to the strength of the euro in relation to the dollar contributed about two-thirds of both increases. Sales of blow molding systems were flat in relation to 2002 but orders and shipments of European-built injection molding machines increased as measured in local currency despite weaker price realization. The segment’s operating results improved significantly as a result of our recent restructuring of its blow molding systems business as its loss excluding restructuring costs decreased from $8.1 million in 2002 to $1.4 million in 2003. Restructuring costs totaled $6.5 million in 2003 and related principally to the restructuring of the blow molding business and the discontinuation of certain of its product

lines and to overhead reductions in the segment’s injection molding machinery business. To date, these 2003 actions have resulted in savings in excess of $1 million but are expected to result in savings in excess of $6 million in 2004. Including the benefits of additional actions that began in 2001, the segment’s total savings in 2004 are expected to be approximately $14 million.

Mold technologies — In 2003, the mold technologies segment had new orders and sales of $169 million compared to $175 million of orders and sales in 2002. The decreases occurred despite favorable currency effects of approximately $10 million. The segment’s profitability was adversely affected by low levels of industrial production and capacity utilization in both North America and Europe. Inefficiencies associated with the consolidation of the segment’s European operations continued into 2003 and adversely affected its results as did reduced profitability in North America. Excluding restructuring costs, the segment had operating earnings of $1.8 million in 2003 compared to earnings of $5.3 million in 2002. Restructuring costs totaled $12.6 million in 2003 and related principally to overhead reductions in North America and to the further consolidation of the segment’s European operations. The actions in Europe included the closure of two manufacturing plants and the reorganization and consolidation of the European marketing and sales structure. Restructuring costs of $6.4 million in 2002 related principally to the closure of a manufacturing plant in the U.S. and to costs to integrate two businesses acquired in 2001 with the segment’s existing European operations. The actions initiated in 2002 and 2003 resulted in savings in excess of $4 million and are expected to produce savings in excess of $12 million in 2004. Including the effects of actions that began in 2001, the segment’s 2004 savings will be approximately $19 million.

Industrial fluids — The industrial fluids segment had new orders and sales of $104 million compared to orders and sales of $96 million in 2002. Both increases were due principally to currency effects related to the segment’s operations in Europe. The segment’s operating profit increased from $14.4 million in 2002 to $15.7 million in 2003. The improvement occurred despite a $0.9 million reduction in pension income.

Our pretax loss was $111.8 million in 2003 compared to a loss of $36.6 million in 2002. The amount for 2003 includes restructuring costs of $27.1 million and the $65.6 million goodwill impairment charge. In 2002, restructuring costs were $13.9 million. The comparison between years was also adversely affected by a $7.1 million reduction in the amount of pension income related to continuing operations and the absence in 2003 of the previously discussed $4.5 million of royalty income.

As was previously discussed in “Significant Accounting Policies and Judgments — Deferred Tax Assets and Valuation Allowances,” we recorded a $71 million charge in the second quarter tax provision to establish valuation allowances against a portion of our U.S. deferred tax assets. Additional deferred tax assets and valuation allowances were recorded in the second half of the year. Due to the geographic mix of earnings and losses, the tax provision for 2003 also includes income tax expense related to profitable operations in non-U.S. jurisdictions. These factors resulted in a 2003 provision for income taxes of $72.7 million despite a pretax loss of $111.8 million.

In 2002, we recorded tax benefits related to losses in the U.S. at the federal statutory rate. We also had a favorable tax rate for non-U.S. operations due in part to permanent deductions in The Netherlands, the benefits of which were partially offset by increases in valuation allowances in Germany and Italy. The 2002 consolidated effective rate of almost 50% also benefited from the favorable resolution of tax contingencies in the U.S. and other jurisdictions.

Our 2003 loss from continuing operations was $184.5 million, or $5.49 per share, which includes after-tax restructuring costs of $25.5 million, the goodwill impairment charge of $65.6 million (with no tax benefit) and the $71 million tax adjustment to record U.S. valuation allowances. In 2002, our loss from continuing operations was $18.4 million, or $0.56 per share. The loss for 2002 includes after-tax restructuring costs and

In 2003 and 2002, the loss from discontinued operations includes our round metalcutting tools and grinding wheels businesses. The former was sold in two separate transactions in September 2003, and the grinding wheels business was sold on April 30, 2004. In 2002, discontinued operations also include the Valenite and Widia and Werkö metalcutting tools businesses that were sold in August of that year. The losses that were incurred in both years resulted from depressed levels of industrial production in North America and — in 2002 — Europe and India and from inefficiencies associated with managing businesses in the process of being sold.

As discussed more fully in the Notes to Consolidated Financial Statements, in 2002 we recorded a net gain of $8.4 million related to the divestitures of discontinued operations. In 2003, we recorded expense of $0.8 million to adjust sale-related accruals and reserves to reflect current expectations.

Effective January 1, 2002, we recorded a pretax goodwill impairment charge of $247.5 million ($187.7 million after tax or $5.61 per share) as the cumulative effect of a change in method of accounting in connection with the adoption of Statement of Financial Accounting Standards No. 142. Approximately 75% of the pretax charge related to our container blow molding and round metalcutting tools businesses, the latter of which was sold in 2003.

Our net loss for 2003 was $191.7 million, or $5.70 per share, compared to a loss of $222.9 million, or $6.67 per share, in 2002. The amount for 2003 includes the previously discussed restructuring costs, goodwill impairment charge, tax adjustment for valuation allowances and the losses from discontinued operations. The loss for 2002 includes restructuring costs, the net loss from discontinued operations and the cumulative effect adjustment.

In 2002, consolidated new orders for continuing operations totaled $703 million, a decrease of $19 million, or 3%, in relation to orders of $722 million in 2001. Sales decreased from $755 million to $693 million. The decreases occurred despite favorable currency effects and the contributions of the 2001 acquisitions. As was the case for much of 2001, low levels of industrial production and capital spending in the plastics processing industry penalized results in 2002. However, order levels and shipments increased modestly in the fourth quarter.

Export orders totaled $66 million in 2002 compared to $78 million in 2001 while export sales decreased from $82 million to $71 million. In both cases, the decreases resulted from reduced export volume for plastics processing machinery. Sales of all segments to non-U.S. customers, including exports, totaled $296 million, or 43% of sales, in 2002 compared to $307 million, or 41% of sales, in 2001. Sales of products manufactured outside the U.S. were $265 million in 2002 and $256 million in 2001.

Our backlog of unfilled orders was $76 million at December 31, 2002 and $61 million at December 31, 2001. The increase resulted principally from higher fourth quarter order levels for plastics processing machinery worldwide.

After deducting $1.9 million of restructuring costs related to product line discontinuation in 2002 and $3.1 million of such costs in 2001, the consolidated manufacturing margin increased modestly from 17.0% to 17.3%. Excluding these costs, margins were 17.5% in 2002 and 17.4% in 2001. Despite our aggressive cost reduction efforts, lower order and sales volume and reduced manufacturing cost absorption continued to depress the margins of certain segments as described below.

In 2002, total selling and administrative expense decreased in dollar amount due to our ongoing cost reduction initiatives and reduced variable selling costs that resulted from lower sales volume. As a percentage of sales, selling expense held steady at 13.4%. Administrative expense decreased by 5% in relation to 2001.

Other expense — net decreased from $12.9 million in 2001 to income of $1.0 million in 2002. The amount for 2002 includes $4.5 million of royalty income from the licensing of patented technology whereas the amount for 2001 includes goodwill amortization expense of $10.8 million and a gain of $2.6 million on the sale of surplus real estate.

In response to exceptionally low order levels, in the third and fourth quarters of 2001 we implemented plans to consolidate manufacturing operations and further reduce our cost structure. These plans resulted in pretax charges to earnings from continuing operations of $17.8 million, including $14.1 million in 2001 and $3.7 million in 2002. In 2001, we also initiated a plan to integrate the operations of EOC and Reform, both of which were acquired in the second quarter of that year, with our existing mold base and components business in Europe. The total cost of completing the integration was originally expected to be $9.2 million but was ultimately increased to $11.0 million due to unanticipated costs related to the integration and lower than expected realizable values for surplus assets. Of the total cost, $1.2 million was included in reserves for employee termination benefits and facility exit costs that were established in the allocations of the EOC and Reform acquisition costs. The remainder was charged to expense, including $3.4 million in 2001 and $4.6 million in 2002.

In connection with the plans initiated in 2001, we recorded pretax restructuring costs related to continuing operations of $8.3 million in 2002 compared to $17.5 million in 2001. Cash costs for the restructuring actions and the integration of EOC and Reform were $13.2 million in 2002. In the aggregate, the actions initiated in 2001 are generating over $35 million in annualized cost savings, most of which were realized in 2002.

In the third quarter of 2002, we approved additional restructuring plans for the purpose of further reducing our cost structure in certain businesses and to reduce corporate costs as a result of the dispositions of Widia, Werkö and Valenite. These actions resulted in third quarter restructuring expenses of $1.3 million.

In November 2002, we announced additional restructuring initiatives intended to improve operating efficiency and customer service. The first action involved the transfer of all manufacturing of container blow molding machines and structural foam systems from the plant in Manchester, Michigan to our more modern and efficient facility near Cincinnati, Ohio. The mold making operation has also been moved to a smaller, more cost-effective location near Manchester. In the second initiative, the manufacture of special mold bases for injection molding at the Monterey Park, California plant was phased out and transferred to various other facilities in North America. These additional actions were expected to result in incremental restructuring costs of $7 to $8 million, of which $4.3 million was charged to expense in 2002 with a majority of the remainder to be recorded in 2003. The total cash cost of these initiatives was expected to be approximately $6 million, most of which was to be spent in 2003. The pretax annualized cost savings were expected to exceed $4 million, most of which was realized in 2003.

Machinery technologies — North America — In 2002, the machinery technologies — North America segment had orders and sales of $321 million and $314 million, respectively. In 2001, the segment’s orders totaled $337 million and sales were $362 million. While new business and shipment levels remained low for much of the year due to depressed capital spending levels in the plastics processing industry, volume increased modestly in the fourth quarter. Despite lower sales volume, the segment’s manufacturing margin improved in 2002 as a result of our cost reduction and restructuring efforts. Excluding restructuring costs of $6.7 million, the segment had operating earnings of $8.0 million in 2002 compared to a 2001 operating loss of $13.5 million which excludes $6.8 million of restructuring costs. The amount for 2002 includes the previously discussed $4.5 million of royalty income. Goodwill amortization expense included in the 2001 amount totaled $3.9 million.

Machinery technologies — Europe — New orders were $122 million in 2002, an increase of $8 million in relation to the prior year that was due principally to favorable currency effects. Sales decreased from $123 million to $117 million despite favorable currency effects. Manufacturing margins also decreased slightly in 2002 and the segment’s results continued to be penalized by operating problems related to the consolidation of the segment’s European blow molding systems business that was completed in 2001. The segment had an operating loss of $8.1 million in 2002 compared to a loss of $9.1 million in 2001. The amount for 2002 excludes a credit of $.4 million related to the reversal of excess restructuring reserves that had been accrued in 2001 while the loss for 2001 excludes restructuring expense of $6.9 million. Goodwill amortization expense in 2001 was $1.4 million.

Mold technologies — The mold technologies segment had new orders of $174 million in 2002, a decrease of $10 million in relation to orders of $184 million in 2001. Sales also decreased by $10 million from $185 million to $175 million. The decreases were due in part to low levels of industrial production and capacity utilization in the North American plastics industry but order levels and shipments also decreased in the segment’s European operations. Due to reduced volume, the segment’s manufacturing margin decreased by approximately one percentage point. Excluding restructuring costs of $6.4 million, the segment had operating earnings of $5.3 million in 2002 compared to earnings of $12.1 million in 2001 which excludes restructuring costs of $3.5 million. The margin decrease and reduction in profitability were due principally to costs and inefficiencies related to the integration of EOC and Reform with the segment’s existing European mold base business. See “Executive Summary — Acquisitions.” The amount for 2002 includes a fourth quarter goodwill impairment charge of $1.0 million related to a small business unit in the segment. Goodwill amortization expense in 2001 was $5.2 million.

Industrial fluids — In the industrial fluids segment, new orders and sales both increased from $93 million in 2001 to $96 million in 2002. Approximately one-half of the increases resulted from favorable currency effects. The segment’s manufacturing margin decreased only modestly but its operating profit fell from $18.1 million, which excludes $0.3 million of restructuring costs, to $14.4 million in 2002. The profitability decrease resulted principally from the absence of one-time favorable adjustments in 2001 that did not recur in 2002. Expense for goodwill amortization in 2001 was $0.3 million.

Our pretax loss in 2002 was $36.6 million compared to a loss of $51.0 million in 2001. The 2002 amount includes restructuring costs of $13.9 million, partially offset by the previously discussed $4.5 million of royalty income. The amount for 2001 includes goodwill amortization expense of $10.8 million, $17.5 million of restructuring costs and the $2.6 million land sale gain.

During 2002, we recorded a net benefit related to income taxes due to the combined effects of operating losses in the U.S. and a favorable effective tax rate for non-U.S. operations. The losses incurred by our U.S. operations resulted in tax benefits based on the federal statutory rate and our effective tax rate for state and local tax purposes, in both cases adjusted for permanent differences and applicable credits. The favorable tax rate for non-U.S. operations was due in part to permanent deductions in The Netherlands partially offset by increases in valuation allowances (as discussed below) in Germany and Italy. The consolidated effective tax rate also benefited from the favorable resolution of tax contingencies related to the U.S. and other jurisdictions.

We entered both 2002 and 2001 with significant net operating loss carryforwards in certain jurisdictions along with valuation allowances against the carryforwards and other deferred tax assets. Valuation allowances are evaluated periodically and revised based on a “more likely than not” assessment of whether the related deferred tax assets will be realized. Increases or decreases in these valuation allowances serve to unfavorably or favorably impact our effective tax rate.

Our 2002 loss from continuing operations was $18.4 million, or $0.56 per share, compared to a loss of $28.7 million, or $0.87 per share, in 2001. The amount for 2002 includes after-tax restructuring costs of $8.8 million and after-tax royalty income of $2.8 million. The loss from continuing operations for 2001 includes after-tax goodwill amortization expense of $7.0 million, after-tax restructuring costs of $11.0 million, and the after-tax land sale gain of $1.6 million.

Our discontinued operations — Valenite, Widia, Werkö, grinding wheels and round metalcutting tools — had combined losses from operations of $25.2 million, or $0.75 per share, in 2002 compared to losses of $7.0 million, or $0.21 per share, in 2001. The adverse comparison to 2001 resulted from depressed levels of industrial production in North America, Europe and India as well as inefficiencies associated with managing businesses in the process of being sold.

As described more fully in the Notes to Consolidated Financial Statements, in 2002 discontinued operations includes a net gain of $8.4 million that resulted from a gain of $31.3 million on the sale of Valenite and a benefit of $1.9 million from adjustments of reserves related to the 1998 divestiture of the machine tools segment. These amounts were partially offset by losses on the sale of Widia and Werkö of $14.9 million and on the planned dispositions of the round metalcutting tools and grinding wheels businesses totaling $9.9 million. The latter amount was recorded as a charge to earnings in the fourth quarter. The amounts for the Valenite and the Widia and Werkö transactions were revised in the fourth quarter from the amounts previously recognized to reflect final purchase price adjustments and to adjust reserves and tax effects to reflect more recent estimates of expected liabilities or benefits.

Including the effects of discontinued operations and the change in method of accounting, we had a net loss of $222.9 million, or $6.67 per share, in 2002 compared to a net loss of $35.7 million, or $1.08 per share, in 2001. The amount for 2002 includes the previously discussed restructuring costs and royalty income as well as

Due to the significant effects of restructuring costs in recent periods, the following tables are provided to assist the reader in better understanding our operating earnings (loss) including these amounts.

The industrial fluids segment had no restructuring costs in the first quarter of 2004 or in 2003.

We use foreign currency forward exchange contracts to hedge our exposure to adverse changes in foreign currency exchange rates related to firm commitments arising from international transactions. We do not hold or issue derivative instruments for trading purposes. At March 31, 2004, we had outstanding forward contracts totaling $2.0 million. Forward contracts totaled $4.7 million at December 31, 2003, $3.8 million at March 31, 2003 and $5.0 million at December 31, 2002. The annual potential loss from a hypothetical 10% adverse change in foreign currency rates on our foreign exchange contracts at March 31, 2004, December 31, 2003, March 31, 2003 or December 31, 2002 would not materially affect our consolidated financial position, results of operations or cash flows.

At March 31, 2004, we had fixed interest rate debt of $254 million, including $103 million related to the transactions entered into on March 12, 2004 and € 115 million ($139.4 million) of the Eurobonds. We also had floating rate debt totaling $94 million, with interest fluctuating based primarily on changes in LIBOR. At March 31, 2003, fixed rate debt totaled $251 million, and floating rate debt totaled $53 million. The potential annual loss on floating rate debt from a 10% increase in interest rates would not be significant.

At December 31, 2003, our continuing operations had fixed interest rate debt of $270 million, including $115 million of 8 3/8% Notes due March 15, 2004, and € 115 million ($143 million) of the Eurobonds. We also had floating rate debt totaling $53 million, with interest fluctuating based primarily on changes in LIBOR. At December 31, 2002, fixed rate debt related to continuing operations totaled $246 million, and floating rate debt totaled $55 million. We also had the ability to sell up to $40 million of accounts receivable under our receivables purchase agreement which resulted in financing fees that fluctuated based on changes in commercial paper rates. As a result, annual interest expense and financing fees fluctuated based on changes in short-term borrowing rates. The potential annual loss on floating rate debt from a hypothetical 10% increase in interest rates would be approximately $0.3 million at December 31, 2003, and $0.4 million at December 31, 2002 under the arrangements in effect at those dates.

On March 12, 2004, we entered into two financing agreements to repay our 8 3/8% Notes due March 15, 2004, the outstanding debt under our then-existing revolving credit facility which was terminated on March 12, 2004, and our obligations under our then-existing receivables purchase agreement which was terminated on March 12, 2004. See “Liquidity and Sources of Capital — March 12 Transactions.” On June 10, 2004, we entered into an asset-based revolving credit facility and terminated the senior secured credit facility entered into on March 12, 2004 and exchanged the outstanding debt under the other financing agreement entered into on March 12, 2004 for our Series B Preferred Stock. Effective as of June 10, 2004, our interest rate risk, including our exposure to floating interest rates, is based on the financing arrangements entered into on June 10, 2004. See “Liquidity and Sources of Capital — June 10 Transactions.”

As discussed more fully in the Notes to Consolidated Financial Statements, we had maintained a receivables purchase agreement with a third-party financial institution for the last several years. Under this arrangement we sold, on a revolving basis, an undivided percentage ownership interest in designated pools of accounts receivable. As existing receivables were collected, undivided interests in new eligible receivables were sold. Accounts that became 60 days past due were no longer eligible to be sold and we were at risk for any related credit losses. Credit losses have not been significant in the past and we maintained an allowance for doubtful accounts sufficient to cover our estimated exposures. At December 31, 2003, approximately $36 million of accounts receivable had been sold under this arrangement which expired on March 12, 2004. The average amount sold during 2003 was also approximately $36 million. On March 12, 2004 this facility was repaid and terminated. See “Liquidity and Sources of Capital — March 12 Transactions.”

Certain of our non-U.S. subsidiaries also sell accounts receivable on an ongoing basis for purposes of improving liquidity and cash flows. Some of these sales are made with recourse, in which case appropriate reserves for potential losses are provided. At March 31, 2004 and December 31, 2003, the gross amount of receivables sold totaled $7.2 million and $3.8 million, respectively. The average amount sold during 2003 was approximately $5 million. Financing fees related to these arrangements were not material.

In years prior to 2003, our U.S. operations sold with recourse notes from its customers for the purchase of plastics processing machinery. In certain other cases, we guaranteed the repayment of all or a portion of notes payable from our customers to third-party lenders. These arrangements were entered into for the purpose of facilitating sales of machinery. New sales of notes and guarantees were not significant in 2003 but we retain potential obligations under earlier arrangements. In the event a customer fails to repay a note, we generally regain title to the machinery. At March 31, 2004 and December 31, 2003, our maximum exposure under these U.S. guarantees, as well as certain guarantees by certain of our non-U.S. subsidiaries, totaled $8.2 million and $11.6 million. Losses related to sales of notes and guarantees have not been material in the past.

Our contractual obligations for the remainder of 2004 and beyond are shown as of March 31, 2004 in the table that follows.

The above table excludes the contingent liabilities of up to $15.4 million related to sales of receivables and loan guarantees that are discussed above.

The following pro forma contractual obligations table gives effect to the June 10 Transactions as if they had occurred on March 31, 2004. The pro forma information is presented for illustrative purposes only and does not purport to represent what our actual contractual obligations would have been had the June 10 Transactions been completed on such date and is not necessarily indicative of our future financial position or results of operations.

At March 31, 2004, we had cash and cash equivalents of $62.0 million, a decrease of $30.8 million from December 31, 2003. The decrease was due principally to the repayment of debt and other obligations in connection with the refinancing transactions entered into on March 12, 2004. Of the $62.0 million of cash, a

Operating activities used $42 million of cash in the first quarter of 2004 compared to $5 million of cash used in 2003. The amount for 2004 includes a $33 million use of cash related to the termination and repayment of our receivables purchase program and $3 million of costs incurred in pursuing alternatives to the refinancing actions that are discussed below. Excluding these amounts, operating activities used $6 million of cash in 2004. The $5 million use of cash in 2003 resulted principally from reductions in trade payables and certain other liabilities and from a modest increase in inventories due to the relocation of certain manufacturing operations and work schedule adjustments.

In the first quarter of 2004, investing activities resulted in a $1 million use of cash — largely for capital expenditures — compared to a $32 million use of cash in 2003. The amount for 2003 includes $24 million for post-closing adjustments related to 2002 divestitures and $7 million to increase our ownership interest in two affiliates to 100%.

In the first quarter of 2004, financing activities provided $17 million of cash. In the comparable period of 2003, financing activities used $3 million of cash due to repayments of borrowings under lines of credit. The amount for 2004 reflects $183 million of proceeds from the refinancing transactions entered into on March 12, 2004 (as described below) partially offset by $157 million for the repayment of the 8 3/8% Notes due March 15, 2004 and the revolving credit facility that matured on March 15, 2004 and by $8 million of debt issuance costs related to the new financing arrangements.

Our current ratio related to continuing operations was 1.0 at March 31, 2004 compared to 1.0 at December 31, 2003 and 1.1 at March 31, 2003.

Total debt was $348 million at March 31, 2004 compared to $323 million at December 31, 2003. The increase is due principally to the repayment of the off-balance sheet receivables purchase program. The repayment was financed through the issuance of new debt.

Total shareholders’ equity was a negative $43 million at March 31, 2004, a decrease of $9 million from December 31, 2003.

At December 31, 2003, we had cash and cash equivalents of $93 million, a decrease of $29 million from December 31, 2002. Approximately $24 million of the decrease resulted from the payment in 2003 of post-closing adjustments related to the divestitures for Valenite and Widia and Werkö which were sold in 2002. Of the $93 million of cash at December 31, 2003, approximately $3 million was used to collateralize sales of certain non-U.S. receivables. A substantial amount of the cash was held in foreign accounts in support of our non-U.S. operations. Were this non-U.S. cash to be repatriated, it could result in withholding taxes in foreign jurisdictions.

Operating activities provided $10 million of cash in 2003 due to reductions in inventories and trade receivables that resulted from our aggressive working capital management initiatives. Cash flows for 2003 also benefited from the receipt of $21 million of refunds of income taxes paid in prior years. These benefits were partially offset by reductions of certain current liabilities. In 2002, operating activities provided $36 million cash due principally to the results of our working capital management programs.

Investing activities used $31 million of cash in 2003, principally for post-closing adjustments related to the 2002 divestitures and for acquisitions and capital additions. In 2002, investing activities provided $301 million of cash due to the divestiture proceeds which were offset to some degree by capital expenditures and acquisition-related costs.

In 2003, financing activities used $6 million of cash, principally for debt repayments. In 2002, financing activities used $303 million of cash due to debt repayments using a portion of the divestiture proceeds.

Our current ratio related to continuing operations was 1.0 at December 31, 2003 compared to 1.6 at December 31, 2002. The change is due principally to the reclassification of $115 million of 8 3/8% Notes due March 15, 2004 from noncurrent liabilities at December 31, 2002 to current liabilities at December 31, 2003.

Total shareholders’ equity was a deficit of $34 million at December 31, 2003 a decrease of $168 million from December 31, 2002. The decrease resulted from the net loss incurred for the year which includes the effects of the $66 million goodwill impairment charge and the $71 million tax provision to establish U.S. valuation allowances.

Total debt was $323 million at December 31, 2003 compared to $302 million at December 31, 2002. The increase resulted entirely from currency effects and occurred despite $5 million of debt repayments during the year.

At December 31, 2003, we had lines of credit with various U.S. and non-U.S. banks totaling approximately $94 million, including a $65 million committed revolving credit facility. At December 31, 2003, $54 million of the revolving credit facility was utilized, including outstanding letters of credit of $12 million. The facility had a maturity date of March 15, 2004.

The revolving credit facility included a number of financial and other covenants, the most significant of which required us to achieve specified minimum levels of four quarter trailing cumulative consolidated EBITDA (earnings before interest, taxes, depreciation and amortization). At December 31, 2003, we were in compliance with all covenants.

On March 12, 2004, all amounts borrowed under our previous revolving credit facility were repaid and the commitments thereunder were terminated in connection with our agreement to enter into a new $140 million senior secured credit facility. See “Liquidity and Sources of Capital — March 12 Transactions.”

In addition to the senior secured credit facility, at March 31, 2004, we had other lines of credit with various U.S. and non-U.S. banks totaling approximately $29 million. As of December 31, 2003, we had a number of credit lines in addition to our previous revolving credit facility totaling $29 million, of which approximately $15 million was available for use under various conditions. Under the terms of the previous revolving credit facility, increases in debt were primarily limited to current lines of credit and certain other indebtedness from other sources.

On June 10, 2004, all amounts borrowed under the $140 million senior secured credit facility were repaid and the commitments thereunder were terminated in connection with the refinancing transactions described below, which include our entering into of a new $75 million asset based revolving credit facility. See “Liquidity and Sources of Capital — June 10 Transactions.”

Our debt and credit are rated by Standard & Poor’s (S&P) and Moody’s Investors Service (Moody’s). On June 11, 2004, S&P announced that it had raised our corporate credit rating to B- with a “positive” outlook. On June 16, 2004, Moody’s reaffirmed our senior unsecured rating at Caa2 and our senior implied rating at Caa1 and raised the outlook to “positive.”

None of our debt instruments include rating triggers that would accelerate maturity or increase interest rates in the event of a ratings downgrade. Accordingly, any future rating downgrades would have no significant short-term effect, although they could potentially affect the types and cost of credit facilities and debt instruments available to us in the future.

Our accounts receivable purchase program with a third-party financial institution had been another important source of liquidity for the last several years. During the fourth quarter of 2003, the liquidity facility that supported the program was extended from the scheduled expiration date of December 31, 2003 to February 27, 2004. The receivables purchase agreement was also amended to mature at February 27, 2004. On February 27, 2004, the expiration of the liquidity facility and the maturity of the receivables purchase agreement were both extended to March 12, 2004. Including $2.9 million related to discontinued operations, $35.9 million of the $40.0 million facility was utilized at December 31, 2003.

On March 12, 2004, this facility was repaid. See “Liquidity and Sources of Capital — March 12 Transactions.”

On March 12, 2004, we entered into a definitive agreement whereby Glencore and Mizuho purchased $100 million in aggregate principal amount of our new exchangeable debt securities. The proceeds from this transaction, together with existing cash balances, were used to repay our 8 3/8% Notes due March 15, 2004. The securities we issued were $30 million of 20% Secured Step-Up Series A Notes due 2007 and $70 million of 20% Secured Step-Up Series B Notes due 2007. The $30 million of Series A Notes were convertible into shares of our common stock at a conversion price of $2.00 per share. Glencore and Mizuho converted the entire principal amount of the Series A Notes into 15 million shares of common stock on April 15, 2004. The Series A Notes and Series B Notes initially bore a combination of cash and pay-in-kind interest at a total rate of 20% per annum, which rate was retroactively reset on June 10, 2004 to 6% per annum from the date of issuance, payable in cash.

On March 12, 2004, we also reached a separate agreement with Credit Suisse First Boston for a $140 million senior secured credit facility having a term of approximately one year. This senior secured credit facility consisted of a $65 million revolving A facility and a $75 million term loan B facility. On March 12, 2004, we used extensions of credit under the revolving A facility and term loan B facility in an aggregate amount of $84 million to repay and terminate our then-existing revolving credit facility (and to replace or provide credit support for outstanding letters of credit) and our then-existing receivables purchase program.

On June 10, 2004, the common stock into which the Series A Notes were converted and the Series B Notes were exchanged for 500,000 shares of Series B Preferred Stock, a new series of our convertible preferred stock with a cumulative cash dividend rate of 6%. On June 10, 2004, we also satisfied the conditions to release to us from escrow the proceeds from the offering of the original notes and entered into an agreement for a new $75 million asset based revolving credit facility with JPMorgan Chase Bank as administrative agent and collateral agent.


	•	purchase €114,990,000 of the €115 million aggregate outstanding principal amount of Milacron Capital Holdings B.V.’s 7 5/8% Guaranteed Bonds due in April 2005 at the settlement of a tender offer therefor;

	•	terminate and repay $19 million in amounts outstanding under the revolving A facility (we also used $17.4 million of availability under our asset based facility to replace or provide credit support for the outstanding letters of credit under the revolving A facility);

	•	repay the $75 million term loan B facility; and

	•	pay transaction expenses.

As of June 18, 2004, Glencore and Mizuho collectively owned 100% of the shares of our outstanding Series B Preferred Stock, which represents approximately 57% of our outstanding fully diluted equity (on an as-converted basis). Glencore has reported in a Schedule 13D filing with the SEC that it has sold an undivided participation interest in its investment in us to Triage Offshore Funds, Ltd. equivalent to 62,500 shares of Series B Preferred Stock, representing approximately 7.2% of our outstanding equity (on an-as-converted basis), with Glencore remaining as the record holder of such shares. If we redeem a portion of Glencore’s and Mizuho’s shares of Series B Preferred Stock with the proceeds of the Rights Offering, Glencore’s and Mizuho’s collective holdings would represent approximately 43% of our outstanding equity, with Triage’s participation interest in Glencore’s holdings representing approximately 5.0% of our outstanding equity, in each case on an as-converted basis and assuming full subscription in the Rights Offering. After seven years, the Series B Preferred Stock will automatically be converted into common stock at a conversion price of $2.00 per share but may be converted prior to that time at the option of the holders. The conversion price is subject to reset to $1.75 per share at the end of the second quarter of 2005 if a test based on our financial performance for 2004 is not satisfied. In addition, as part of the transaction we have issued to holders

of the Series B Preferred Stock contingent warrants to purchase an aggregate of one million shares of our common stock, which contingent warrants are exercisable only if a test based on our financial performance for 2005 is not satisfied. Assuming that we do not conduct the Rights Offering, and both the conversion price of the Series B Preferred Stock is reset to $1.75 and the contingent warrants are exercised, the holders of the Series B Preferred Stock would own approximately 62.5% of our fully diluted equity (on an as-converted basis).

The conversion of the Series A Notes into newly issued common stock on April 15, 2004, and the exchange of such common stock and the Series B Notes for Series B Preferred Stock on June 10, 2004, triggered an “ownership change” for U.S. federal income tax purposes. As a consequence of this ownership change, the timing of our utilization of tax loss carryforwards and other tax attributes will be substantially delayed. This delay will increase income tax expense and decrease available cash in future years.

The holders of the Series B Preferred Stock, voting separately as a class, have the right to elect a number of directors to our Board of Directors in proportion to the percentage of fully diluted common stock represented by the outstanding Series B Preferred Stock (on an as-converted basis), rounded up to the nearest whole number (up to a maximum equal to two-thirds of the total number of directors, less one).

The borrowings under our asset based facility entered into on June 10, 2004 are secured by a first priority security interest, subject to permitted liens, in, among other things, U.S. and Canadian accounts receivable, cash and cash equivalents, inventory and, in the U.S., certain related rights under contracts, licenses and other general intangibles, subject to certain exceptions. Our asset based facility is also secured by a second priority security interest in our assets that secure the notes on a first priority basis. The availability of loans under our asset based facility is limited to a borrowing base equal to specified percentages of eligible accounts receivable and inventory and is subject to other conditions and limitations, including an excess availability reserve of $10 million. As a result, substantially less than the full amount of our asset based facility is currently available to us.

Based upon the initial evaluation of our accounts receivable and inventory conducted by the agent and the lead arranger for the asset based facility, as of June 10, 2004 and without giving effect to initial borrowings and issuances of letters of credit, we had approximately $59.1 million of borrowing availability, subject to the customary ability of the administrative agent for the lenders to reduce advance rates, impose or change collateral value limitations, establish reserves and declare certain collateral ineligible from time to time in its reasonable credit judgment, any of which could reduce our borrowing availability at any time. The terms of our asset based facility impose a daily cash “sweep” on cash received in our U.S. bank accounts from collections of our accounts receivable. This daily cash “sweep” is automatically applied to pay down any outstanding borrowings under our asset based facility. The terms of our asset based facility also provide for the administrative agent, at its option and at any time, to impose a daily cash “sweep” on cash received in our Canadian bank accounts from collections of our accounts receivable.

Our asset based facility contains customary conditions precedent to any borrowings, as well as customary affirmative and negative covenants, including, but not limited to, maintenance of $10.0 million of unused availability under the borrowing base. As of June 10, 2004, after giving effect to initial borrowings and issuances of letters of credit, our availability before deducting the availability reserve was approximately $34.4 million. In addition, our asset based facility contains, for the first five quarters, a financial covenant requiring us to maintain a minimum level of cumulative consolidated EBITDA, to be tested quarterly, and a limit on capital expenditures to be complied with on a quarterly basis, in each case starting with the third quarter of 2004. Thereafter, we will have to comply with a fixed charge coverage ratio to be tested quarterly.

at which Eurodollar deposits in the London interbank market are quoted on page 3750 of the Dow Jones Market Service. We may elect Eurodollar loans interest periods of one, two or three months. “ABR” means the higher of (i) the rate of interest publicly announced by the administrative agent as its prime rate in effect at its principal office in New York City and (ii) the federal funds effective rate from time to time plus 0.5%.

Our asset based facility provides that we will pay a monthly unused line fee equal to 0.50% per annum on the average daily unused portion of our credit commitment, as well as customary loan servicing and letter of credit issuance fees.

Our asset based facility provides that upon the occurrence and continuance of an event of default under our asset based facility, upon demand by the agent, we will have to pay (x) in the case of revolving credit loans, a rate of interest per annum equal to the rate of interest otherwise in effect (assuming the rate in effect is at the maximum applicable margin) pursuant to the terms of our asset based facility plus 2% and (y) in the case of other amounts, a rate of interest per annum equal to the ABR plus the maximum applicable margin plus 2%. The other terms of our asset based revolving credit facility are described under “Description of Certain Other Indebtedness — The Asset Based Facility.”

Since the cash we receive from collection of receivables is subject to an automatic “sweep” to repay the borrowings under our asset based facility on a daily basis, we rely on borrowings under our asset based facility as our primary source of cash for use in our North American operations. The availability of borrowings under our asset based facility is subject to a borrowing base limitation, including an excess availability reserve, which may be adjusted by the administrative agent at its discretion, and the satisfaction of conditions to borrowing. If we have no additional availability or are unable to satisfy the borrowing conditions, our liquidity could be materially adversely affected.

Completion of the June 10 Transactions reduced our total debt from $362 million after completion of the March 12 Transactions to approximately $252 million. We expect these changes in our capital structure to leave us better-positioned to profit from the anticipated recovery of our markets and to pursue our growth and geographic diversification strategies.

We expect to generate positive cash flow from operating activities during 2004, which will be partially offset by up to $15 to $17 million for capital expenditures. We believe that our current cash position, cash flow from operations, available credit lines, including the asset based revolving credit facility entered into on June 10, 2004, will be sufficient to meet our operating and capital requirements in 2004.

However, during the year ended December 31, 2003, on a pro forma basis to give effect to the Refinancing Transactions, our earnings would have been inadequate to cover fixed charges by $122.2 million. We cannot assure you that our business will generate sufficient cash flow from operations to service our indebtedness and pay other expenses, that currently anticipated cost savings and operating improvements will be realized on schedule or at all or that future borrowings will be available to us under our asset based facility in an amount sufficient to enable us to make interest payments on the notes and our other indebtedness or to fund our other liquidity needs.

Our continued viability depends on realizing anticipated cost savings and operating improvements on schedule during 2004 and a significant improvement in demand levels in 2004 and beyond, the latter of which is largely beyond our control. Unless we realize anticipated cost savings and operating improvements on schedule and volume and pricing levels improve significantly, we may need to fund interest payments on the notes in part with the proceeds of borrowings under our asset based facility. However, our ability to borrow under our asset based facility is subject to borrowing base limitations, including an excess availability reserve, which may be adjusted from time to time by the administrative agent for the lenders under our asset based facility at its discretion, and our satisfaction of certain conditions to borrowing under our asset based facility, including, among other things, conditions related to the continued accuracy of our representations and warranties and the absence of any unmatured or matured defaults (including under financial covenants) or any material adverse change in our business or financial condition. If we have no additional availability or are

unable to satisfy the borrowing conditions, our liquidity would be impaired and we would need to sell assets, refinance debt or raise equity to make the interest payments on the exchange notes and otherwise service our debt and pay our expenses. We cannot assure you that we would be able to sell assets, refinance debt or raise equity on commercially acceptable terms or at all, which could cause us to default on our obligations under the notes and our other indebtedness. Our inability to generate sufficient cash flow or draw sufficient amounts under our asset based facility to satisfy our debt obligations and pay our other expenses could cause us to default on our obligations under the notes and would have a material adverse effect on our business, financial condition and results of operations. See “Risk Factors — Risks Relating to Our Liquidity, the Notes and Our Other Indebtedness.”

We are the largest and broadest-line manufacturer and supplier of plastics processing equipment and related supplies in North America and the third largest worldwide. Our equipment, supplies and services are used by a wide range of plastic processors to produce plastic products and parts for consumer, commercial and industrial markets. Plastics processing is one of the largest industries in the world with total shipments of plastic products and parts valued at over $300 billion in 2003 in the U.S. alone. We also believe we are the second largest global manufacturer of synthetic (water-based) industrial fluids used in metalworking applications.

We were first incorporated in 1884, and our shares have been traded on the New York Stock Exchange since 1946 (Ticker: MZ).

We have made a number of key acquisitions and divestitures designed to strengthen our core businesses — plastics technologies and industrial fluids — on a global basis. In the last five years we have made seven acquisitions in plastics technologies and two in industrial fluids. During this time we have also divested six businesses, most of them metalworking product lines. In plastics, we have diversified into durable goods and consumable products, which are less sensitive to economic cycles and generally have higher margins than capital goods. In 2003, capital goods accounted for 41% of our plastics sales, compared to 69% in 1992. Through recent acquisitions we have also expanded our industrial fluids to include process cleaners and products for metalforming and heat treating.

Due to exceptionally weak business conditions we made no significant acquisitions in 2002 or 2003. Additions to our continuing operations in the last five years have been:

We are committed to growing profitability in each of our business segments and will seek to divest any operation or product line that is not critical to our core businesses or not likely to meet our growth targets. In 2002, we sold our large metalcutting carbide insert businesses in North America, Europe and in Asia, and our round metalcutting tool business in Germany. In 2003, we sold our North American round metalcutting tool businesses and on April 30, 2004, we sold our grinding wheels business.

In the normal course of business, and especially during a prolonged period of depressed manufacturing activity in many world markets, we aggressively seek opportunities to reduce our cost structure and increase our overall efficiency and responsiveness to our customers.

Our cost reduction program in North America and Europe over the past three years has entailed closing nine manufacturing plants and eliminating approximately 1,200 manufacturing and administrative positions worldwide, while generating an annualized cost savings of $69 million.

In 2002, we consolidated the manufacture of our North American container blow molding and structural foam machines and our mold technologies manufacturing and support in North America. For these consolidations, substantially completed in 2003, we recorded total pretax charges of $8.7 million and estimate annualized pretax cost savings in excess of $5 million. We took about half of these charges in 2002 and realized most of the annual cost savings in 2003. Cash costs for these initiatives were $3.6 million, most of which was spent in 2003. In 2003, we also completed the consolidation of our European mold technologies operations in Europe that had begun late in 2001. These actions resulted in the elimination of approximately 230 additional positions and expense of $9.8 million. Cash costs were $9.0 million over the three-year period and the annualized savings will exceed $5 million.

In 2003, we initiated additional actions intended to further reduce our cost structure and improve operating efficiency and customer service. These actions included the further restructuring of our European blow molding operations and the discontinuation of certain of its lines and the closure of an additional mold technologies plant in Europe. In the third quarter we began to implement additional overhead cost reductions in each of our plastics technologies segments and at the corporate office. These actions involve the relocation of production, voluntary early retirement programs, the reorganization of our sales structure and general

We are committed to better serving our customers and to improving our competitive advantage through the implementation of Lean and Six Sigma processes. Since adopting these processes in mid-2001 as part of our total quality leadership business philosophy, over 40% of our employees have received Lean/ Six Sigma training and hundreds of cross-functional teams have solved problems and improved process efficiency. The goal of these efforts is to shorten customer response times and increase cash flow while reducing our overall working capital requirements.

Segment and geographic information for the years ended December 31, 2003, 2002 and 2001 are included in the Notes to Consolidated Financial Statements.

Products and Services. We believe we are the world’s broadest-line supplier of machinery, mold bases and related tooling, supplies and services to process plastics. With combined 2003 sales of $636 million, our plastics technologies businesses are organized in three segments:


	•	Injection molding systems, parts and services supplied from North America and India

	•	Blow molding systems, parts, molds and services supplied from North America

	•	Extrusion systems, parts and services supplied from North America


	•	Injection molding systems, parts and services supplied from Europe

	•	Blow molding systems, parts, molds and services supplied from Europe


	•	Injection mold bases, related components/tooling and services worldwide

	•	MRO-aftermarket parts and supplies worldwide

We strive to be a one-stop source for the needs of plastics processors. We offer full lines of advanced injection molding, extrusion and blow molding equipment and systems, and specialty auxiliary equipment for all types of plastics processing, as well as of supplies and replacement parts. To maximize productivity and profitability, customers count on our technology innovations, value-added services and comprehensive applications expertise. We are also a leading maker and supplier of mold bases and related tooling, components and supplies for the injection mold-making industry, and we make complete molds for blow molding. We are also a supplier of aftermarket MRO items for plastics processing, and we provide retrofit and rebuild services for older equipment manufactured by us and others.

Injection molding is a very versatile process that is used to make a wide variety of plastic products, ranging from auto components, toothbrushes and computer devices to mobile phones, toys, medical equipment and DVDs. We are leading the global industry shift to all-electric injection molding technology, which is cleaner, quieter, more accurate and more energy efficient compared to traditional hydraulic machines. We are also a recognized technology leader in multi-material injection molding, offering systems that significantly reduce the customer’s cost per molded part. And our patented PC-based control technology for plastics molding machines assures high-quality part production and brings the power of the Internet and improved communications to the shop floor.

In blow molding, we believe we are the number-one maker of systems to produce HDPE (high density polyethylene) containers, as well as the world’s largest producer of industrial blow molding equipment to make hollow or semi-hollow products such as automotive components, toys, furniture, luggage and storage and shipping containers. In addition to providing turnkey, state-of-the-art blow molding systems, we are an integrated supplier of molds, tooling, aftermarket parts and services, and applications support.

Our high-output, twin-screw extruders are sold in North America to produce a wide variety of PVC (polyvinyl chloride) and plastic composite products, such as siding, decking, fencing and pipe, used in commercial and home construction markets. Smaller models of our single-screw extruders serve such end markets as plastics film and medical tubing. We also supply a full line of new and rebuilt high-performance barrels and screws, which are the productivity and value components in the extrusion business, for all makes and models of extruders.

Our pre-engineered mold bases and components for injection molding are market leaders in their categories in North America and Europe. We offer the widest range of standard and special mold technologies and the latest advances in quick-change molds, hot runner systems and art-to-part metal printing of complex molds. Independent mold makers are our largest customer category.

We sell MRO supplies and services primarily through catalogs to OEM (original equipment manufacturer) and aftermarket customers around the world. Known for carrying high-quality products at competitive prices, we strive to become an extension of our customers’ businesses by meeting their day-to-day needs for small tools, gauges, temperature regulators, nozzles, screw tips, lubricants, safety supplies and thousands of other items.

Our service parts organization continues to grow worldwide. We supplement our own service technicians with a network of independent providers for 24-hour response across North and South America and in many European countries. Customers have the option of ordering parts and service over the phone or via the Internet.

Markets. One of the largest industries in the world, plastics processing is a major contributor to the vitality of industrialized economies and to the continuing growth of developing areas. Markets for plastics processing systems and supplies have grown steadily for over half a century, as plastics and plastic composites continue to replace traditional materials such as metal, wood, paper and glass. Plastics have increasingly become the material of choice in many, if not most, manufactured goods.

Advancements in material development and in processing equipment capabilities continue to make plastic products more functional and less expensive, thus spurring secular growth. Thanks to superior strength-to-weight ratios, plastics are increasingly used in transportation-related applications. And consumer demand for safer, more convenient products continues to drive general demand for plastic products.

We compete in a global market, estimated to be $13 billion on an annualized basis, for plastics equipment and supplies. Our product mix generally parallels the major segments of this market. About two-thirds of the market consists of capital equipment, which is highly sensitive to general economic cycles and capital spending patterns. In addition, demand is often shaped by other factors such as fluctuations in resin pricing and availability, oil, gas and electricity prices, the impact of interest rates on new housing starts and auto sales, the introduction of new products or models, and consumer confidence and spending. Changes in currency exchange rates may also affect our customers’ business and, in turn, the demand for processing equipment. To reduce our dependency on capital goods cycles, we have focused on expanding our durable and consumable product offerings, as well as our aftermarket services and support.

It has been well known for many decades that, generally speaking, the use of plastics is environmentally friendly and actually conserves energy when compared to making the same products out of metal, wood, paper and glass. To further address environmental concerns, however, many polymer suppliers, machinery makers and processors are actively developing and improving methods of recycling. As a member of the trade association, The Society of the Plastics Industry, we continue to work with other leading companies to make plastics a part of the solution to the challenges of energy and environmental conservation.

Geographic Sales. About 62% of our plastics technologies products and services in 2003 were sold to customers in North America. European sales made up about 27% of the total, with the remainder coming from Asia and the rest of the world.

Distribution. We maintain sales, marketing and customer service facilities in major cities across North America, Europe and Asia. We also sell through large networks of distributors and/or sales and service offices in all major countries.

We sell our plastics machinery and systems through a combination of direct sales force and independent agents who are spread geographically throughout our key markets. We sell our mold bases, supplies and components through a direct distribution network in North America and Europe, through a large network of joint venture sales and service offices in Asia, over the Internet and via telemarketing. We market our MRO supplies in traditional printed catalogs, as well as through electronic catalogs and over the Internet.

Customers. Our plastics technologies customers are involved in making a wide range of everyday products: from food and beverage containers to refrigerator liners; from electronic and medical components to digital cameras and razors; from milk bottles to plastic-lumber decking. Key end markets in order of 2003 sales were packaging, automotive and transportation, building materials, industrial components, consumer goods and toys, custom molders, appliances and housewares, medical devices, and electrical and electronics.

Production Facilities. For our three plastics technologies segments, we maintain the following principal production facilities:

Competition. The markets for plastics technologies are global and highly competitive and include North American, European and Asian competitors. We believe we have the number-one share of the North American market and the number-three share worldwide. A few of our competitors are larger than us, most are smaller, and only a few compete in more than one product category. Principal competitive factors in the plastics technologies industry are product features, technology, performance, reliability, quality, delivery, price and customer service.

Products and Services. We provide metalworking industries worldwide with a wide variety of coolants, lubricants, forming fluids, process cleaners and corrosion inhibitors used in the shaping of metal products. Customers count on our extensive knowledge of chemistry and metalworking applications to maximize their productivity.


	•	Metalcutting and metalforming coolants and lubricants

	•	Process cleaners, corrosion inhibitors and specialty products

Coolants are required in the vast majority of metalworking operations, including cutting, grinding, stamping and forming, to achieve desired part quality and output through higher metal-removal rates and longer tool life. Our family of premium fluids meets the demands of today’s toughest metalworking operations, offering unmatched machining and grinding performance. One of our more popular blends, for example, can increase the life of grinding wheels by a hundredfold or more in certain applications compared to conventional fluids. For over 50 years, our specialty has been water-based synthetic fluids, which provide excellent lubricity and are generally more environmentally friendly than oil-based products. More recently, our new high-performance “green” fluids made from vegetable oils have been gaining acceptance, albeit limited, among metalworking customers concerned with environmental and/or disposal issues.

We add value for our customers by helping them maintain the safety and effectiveness of their fluids and by offering them our expertise in fluid/tool synergies in order to optimize their metalworking operations. Optimized fluid and tool selection can provide our customers with significant productivity gains and cost savings.

Our strength is in the area of metal removal (metalcutting and grinding), but we also blend and sell stamping and metalforming fluids, process cleaners, corrosion inhibitors and other specialty products for metalworking, all of which represent good growth opportunities for us.

Markets. Key markets for our industrial fluids include the whole spectrum of metalworking industries: from automotive, aircraft and machinery makers and job shops to manufacturers of appliances, agricultural equipment, and consumer and sporting goods. Our fluids are also used in the production of glass and mirrors and in high-tech processes such as silicon wafer slicing and polishing.

The markets in which our industrial fluids compete total $2.5 billion on an annualized, global basis. Over one-third of the market consists of metalcutting and grinding fluids, with metalforming fluids and process cleaners each accounting for about one-quarter of the market. Demand for our fluids is generally directly proportional to levels of industrial production, although we specifically target higher-growth areas such as machining and forming exotic alloys and aluminum. Factors affecting our customers’ production rates and ultimately demand for our fluids include auto and machinery sales, consumer spending and confidence, interest rates, energy prices and currency exchange rates.

Environmental, health and safety concerns could negatively affect demand for metalworking fluids. When it comes to industrial fluids, we place very high importance on employee safety and environmental protection. In a proactive approach to continually improve the health and environmental effects of metalworking fluids, we work both locally and internationally with suppliers, customers and regulatory authorities and we support and participate in research and educational programs regarding metalworking fluids.

Geographic Sales. About 56% of our 2003 industrial fluid sales were made to customers in North America, while another 37% were to European customers. The remaining sales were to customers in Asia and the rest of the world.

Distribution. Our industrial fluids are sold primarily through industrial distributors, with some direct sales, as well as through traditional printed catalogs and electronic catalogs over the Internet. We produce most of what we sell, and most of what we make is sold under our own brand names. In addition, some of our fluids are sold under brand names of other companies through their own market channels.

Customers. Our metalworking fluids are involved in making all kinds of products: from automotive power train components to aluminum soft drink cans; from air conditioners and glass mirrors to bearings and golf clubs; not to mention a wide variety of industrial components.

Markets for our industrial fluids in order of importance based on 2003 sales were automotive and transportation, industrial components, industrial machinery, job shops, off-road and other heavy equipment, appliances and housewares, aerospace, oil and primary metals, and consumer goods. The largest customer category, automotive and transportation, accounted for 38% of fluid sales in 2003.

Production Facilities. For our industrial fluids segment, we maintain the following principal production facilities:

Competition. We believe we hold a leadership position in world markets for water-based or synthetic metalworking fluids. Our competitors range from large petrochemical companies to smaller companies specializing in similar fluids. Principal competitive factors in this business include market coverage, product performance, delivery, price and customer service.

We emphasize efficient investment in research and development and in new capital equipment to support rapid new product introductions, enhance our global competitive position and achieve sales growth. In 2003, we focused our investment on customer-driven development. To these ends we invested $17.8 million, or 2.4% of sales, in research and development in 2003, compared to $15.8 million, or 2.3% of sales, in 2002.

We hold a number of patents pertaining to both plastics technologies and industrial fluids, none of which are material to their respective business segments.

The average number of our employees from continuing operations was 3,760 people in 2003. Of these, half were outside the U.S. As of December 31, 2003, the number of our employees from continuing operations was about 3,500 people.

Various lawsuits arising during the normal course of business are pending against us and our consolidated subsidiaries. In several such lawsuits, some of which seek substantial amounts, multiple plaintiffs allege personal injury involving products, including metalworking fluids, supplied and/or managed by us. We are vigorously defending these claims and believe we have reserves and insurance coverage sufficient to cover potential exposures.

While, in the opinion of management, the liability resulting from these matters will not have a significant effect on our consolidated financial position or results of operations, the outcome of individual matters cannot be predicted with reasonable certainty at this time.

The following table presents the name, age and position of each member of our senior management and each of our directors as of June 18, 2004:

Ronald D. Brown. Mr. Brown is Chairman of our Board of Directors and our President and Chief Executive Officer. Mr. Brown joined us in 1980 and has served as a Director since 1999. His current term expires in 2006. Mr. Brown has served as Chairman and Chief Executive Officer since June 2001. Prior thereto, Mr. Brown served as Chief Operating Officer from September 1999 to June 2001, and Chief Financial Officer from 1993 to 1999. Mr. Brown is also a director of A.O. Smith Corporation.

Robert P. Lienesch. Mr. Lienesch is our Vice President — Finance and Chief Financial Officer and was elected to this position in 1999. He was elected Vice President and Treasurer in 1998 and served as Treasurer until 2001. Prior to that time, he was Controller from 1989.

Hugh C. O’Donnell. Mr. O’Donnell is our Vice President, General Counsel and Secretary and was elected to this position in 1999. Prior to that time, he served as Corporate Counsel since 1992.

Ross A. Anderson. Mr. Anderson is our Controller and was elected to this position in 2002. Prior to that time, he was Group Controller, Plastics Technologies from 1998 and Controller, U.S. Plastics Machinery from 1989.

John C. Francy. Mr. Francy is our Treasurer and was elected to this position in 2001. Prior to that time, he was Assistant Treasurer from 1998, Director of Treasury Operations from 1997 and Controller of Machine Tool Marketing Worldwide from 1995.

Darryl F. Allen. Mr. Allen has been a Director since 1993. His current term expires in 2006. Mr. Allen is the retired Chairman, President and Chief Executive Officer of Aeroquip-Vickers, Inc., Maumee, Ohio, a worldwide manufacturer and distributor of engineered components and systems for markets that include industrial, automotive, aerospace and defense. Mr. Allen is also a Director of Fifth Third Bancorp. Mr. Allen is a member of the Audit Committee and the Finance Committee of our Board.

David L. Burner. Mr. Burner has been a Director since 1998. His current term expires in 2007. Mr. Burner is the retired Chairman and Chief Executive Officer of Goodrich Corporation, Charlotte, North Carolina, a provider of aircraft systems and services. He served in that capacity from July 1997 to October 2003. He was Chief Executive Officer from December 1996 to July 1997 and President from December 1995 to January 1997. Prior to 1997, he was an Executive Vice President of The BFGoodrich Company and the President and Chief Operating Officer of BFGoodrich Aerospace. Mr. Burner is also a Director of Progress Energy, Inc., Briggs & Stratton Corporation, Lance, Inc. and Engelhard Corporation. Mr. Burner is a member of the Audit Committee and the Personnel and Compensation Committee of our Board.

Barbara Hackman Franklin. Ms. Franklin has been a Director since 1996. Her current term expires in 2005. Ms. Franklin is President and Chief Executive Officer of Barbara Franklin Enterprises, Washington, D.C., an international consulting and investment firm and has served in that capacity since January 1995. From 1993 to 1995, she was an independent director, consultant and lecturer. In 1992, she served as the 29th U.S. Secretary of Commerce. Ms. Franklin is also a Director of Aetna, Inc., The Dow Chemical Company, MedImmune, Inc. and GenVec, Inc. Ms. Franklin is a member of the Finance Committee and the Nominating and Corporate Governance Committee of our Board.

Steven N. Isaacs. Mr. Isaacs is the Chairman and Managing Director of Glencore Finance AG, an investment subsidiary of Glencore International AG, a director of Mopani Copper Mines Limited (Zambia) and an alternate director of Minara Resources Limited (Australia). Mr. Isaacs was appointed as a Director effective on April 5, 2004. His current term expires in 2007. Mr. Isaacs was selected for appointment as a Director and selected for nomination for re-election at our July 9, 2004 annual meeting of shareholders by Glencore Finance AG and Mizuho International plc as holders of the Series A Notes pursuant to the agreement governing the sale of such notes. Mr. Isaacs is a member of the Finance Committee of our Board.

James E. Perrella. Mr. Perrella has been a Director since 1993. His current term expires in 2006. Mr. Perrella is the retired Chairman of Ingersoll-Rand Company, Woodcliff Lake, New Jersey, a worldwide manufacturer of machinery and equipment for automotive, construction, energy and general industries. From 1993 to 1999 he was also President and Chief Executive Officer of Ingersoll-Rand Company. Mr. Perrella is also a Director of Becton, Dickinson and Company, Arvin Meritor, Inc. and Bombardier, Inc. Mr. Perrella is a member of the Audit Committee, the Personnel and Compensation Committee and the Nominating and Corporate Governance Committee of our Board.

Dr. Joseph A. Steger. Dr. Steger has been a Director since 1985. His current term expires in 2007. Dr. Steger had served for more than five years, until his retirement in 2003, as President of the University of Cincinnati and now serves as President Emeritus. Dr. Steger is also a Director of Provident Financial Group, Inc. Dr. Steger is a member of the Audit Committee, the Personnel and Compensation Committee and the Nominating and Corporate Governance Committee of our Board.

Charles F.C. Turner. Mr. Turner has been a Director since 2002. His current term expires in 2005. Prior to his election to the Board in 2002, he had served in various capacities at the company, his last position being Group Director of Information Technology for our Plastics Technologies Group. Mr. Turner has been President of Develin Corporation, a real estate management firm, since 2003. Mr. Turner is a member of the Finance Committee of our Board.

The company compensates non-employee directors by payment of an annual retainer of $35,000. All or a portion of this retainer may be deferred into a company stock and/or cash account under the terms of the company’s Plan for the Deferral of Directors’ Compensation, subject to the requirement that a minimum of $10,000 annually be payable in Company stock and credited to a deferred stock account under the plan. The company also compensates non-employee directors by payment of a fee of $1,500 for each meeting of our Board of Directors and each committee meeting attended. Chairpersons of the Audit Committee, Finance Committee, Nominating and Corporate Governance Committee and Personnel and Compensation Committee of our Board of Directors also receive an annual retainer of $2,000. In addition, the directors may elect to be covered by $100,000 of group term life insurance.

Awards of restricted shares and stock options to directors are provided for in the 1997 Long-Term Incentive Plan. Ms. Franklin and Messrs. Burner, Perrella, Steger, and Turner each received a stock option grant of 2,000 shares under the plan in January, 2003. Mr. Allen declined his stock option grant.

The Retirement Plan for Non-Employee Directors was closed on February 6, 1998, with respect to all non-employee directors beginning their first term on our Board of Directors after said date. The non-employee directors who were not beginning their first term after February 6, 1998, were given the election to continue to participate in the Retirement Plan for Non-Employee Directors or receive the current value of their projected

benefit in a lump sum credited to a deferred stock account under the Company’s Plan for the Deferral of Directors’ Compensation. The Retirement Plan for Non-Employee Directors has a six-year vesting requirement with monthly benefits paid for life. For non-employee directors with ten or more years of vested service, the benefit under the Retirement Plan for Non-Employee Directors is equal to one hundred percent of the director’s base retainer as of the last day of service. A reduced benefit is payable to non-employee directors with less than ten years of vested service.

The calculation of estimated annual retirement benefits under the company’s regular retirement plan (the “Retirement Plan”) is based upon years of service and average earnings for the five consecutive years of highest compensation during such service. Earnings include all cash compensation, including amounts received or accrued under our Short-Term Management Incentive Program, but exclude benefits or payments received under long-term incentive plans or any other employee benefit plan. The Retirement Plan is non-contributory and limits the individual annual benefit to the maximum level permitted under existing law. The credited years of service under the Retirement Plan for the executive officers named in the Summary Compensation Table set forth below are: 14 for Mr. Anderson, 23 for Mr. Brown, 15 for Mr. Francy, 24 for Mr. Lienesch, and 16 for Mr. O’Donnell. Mr. Faig, former president and COO, retired September 30, 2003 with 35 years of credited service under the Retirement Plan. Directors who are not officers or employees of the company are not eligible to participate in the Retirement Plan.

The table below shows examples of pension benefits which are computed on a straight life annuity basis before deduction of the offset provided by the Retirement Plan, which depends on length of service and is up to one-half of the primary Social Security benefit:


(*)	Under existing law, payments of annual benefits in excess of $165,000 may not be made by the Retirement Plan but may be paid directly by the Company, as described in the following paragraph.

In an effort to attract and retain experienced executives, our Board of Directors approved a program wherein certain officers are guaranteed annual pensions of not less than 52.5% and not more than 60% of their highest average pay in a consecutive three-year period. Such pensions include the amount payable under the Retirement Plan and are not subject to the maximum limitation imposed on qualified plans such as the Retirement Plan.

The company has entered into Executive Severance Agreements (the “Severance Agreements”) with Messrs. Anderson, Brown, Francy, Lienesch, and O’Donnell as well as certain other executives (the “Executives”). The Severance Agreements continue through December 31, 2004, and provide that they are to be automatically extended in one-year increments (unless notice by the company is otherwise given) and, in any event, shall continue in effect for a period of two years beyond the term if a Change in Control (as defined below) of the company occurs.

Generally, a “Change in Control” of the company will be deemed to have occurred if: (i) anyone acquires 20% or more of the outstanding voting stock of the company; (ii) the persons serving as directors of the company as of the date of the agreement, and replacements or additions subsequently approved by at least

60% of the incumbent Board, cease to make up a majority of the Board of Directors; (iii) a merger, consolidation, or reorganization occurs after which the holders of the company’s outstanding stock immediately preceding such transaction own less than 66 2/3% of the surviving corporation; (iv) the company disposes of all or substantially all of its assets; or (v) the shareholders of the company approve a plan of liquidation or dissolution of the company. The Severance Agreements were amended effective February 10, 2004 to provide that a financial restructuring or recapitalization of the company in 2004 would not trigger certain benefits otherwise payable upon a Change in Control.

The Severance Agreements provide that the Executives are entitled to certain benefits following a Change in Control of the company, including: (i) the vesting of all equity-based awards, and (ii) cash payments equal to the value of each Executive’s target annual incentive award and any earned but unpaid annual bonus. In the event of a qualifying termination of an Executive following a Change in Control, an Executive is entitled to additional benefits, including: (i) a portion of the Executive’s target annual incentive award then in effect; (ii) a cash payment equal to the value of all outstanding long-term incentive awards, assuming maximum performance, (iii) a cash payment of three or two times (depending upon whether or not a Tier I or Tier II Severance Agreement applies) the sum of the Executive’s base salary and highest bonus award; (iv) special supplemental retirement benefits determined as if the Executive had three or two years additional credited service under the company’s retirement plans; and (v) continuation of all life, disability and accident insurance, and medical plan coverage for a period of three or two years. Due to the February 10, 2004 amendments of the Severance Agreements, awards granted on or after February 10, 2004 will not accelerate and Executives will not be entitled to any cash payments equal to their target annual incentive awards or payment of any earned but unpaid annual bonuses as a result of a restructuring that occurs in 2004. Further, if any of these payments would be subjected to the excise tax imposed on excess parachute payments by the Internal Revenue Code, the Company will “gross-up” the Executive’s compensation for all such excise taxes.

On the recommendation of independent advisors to the Personnel & Compensation Committee of the Board of Directors, in an effort to retain key employees during the uncertainty created by the refinancing process, the company has established a Temporary Enhanced Severance Plan effective November 1, 2003 and extending through December 31, 2005 for certain key employees, including the executive officers named in the Summary Compensation Table. Should a participant experience a qualifying termination during this period he/she would be entitled to certain benefits including severance and outplacement assistance. The benefits provided under this plan would not be cumulative to any other severance benefits to which a participant is entitled. In the event a participant would receive benefits under another company severance plan, then the payments under this plan would be reduced by a like amount.

For 2003, the Personnel and Compensation Committee of the Board of Directors was composed of James E. Perrella, Joseph Pichler and Joseph A. Steger, with Mr. Perrella serving as Chairperson. Each member of the Committee was independent, as defined by the SEC and the NYSE. No member of the Board of Directors and no employee of the company serves or has served on the compensation committee (or the board of directors of a corporation lacking a compensation committee) of a corporation employing a member of the Board of Directors.

The Audit Committee of the Board of Directors is currently composed of three non-employee directors. The Board of Directors has determined that each of David L. Burner and Darryl F. Allen (i) meets the independence requirements of the SEC and the NYSE, (ii) is financially literate within the meaning of the NYSE rules, and (iii) qualifies as an “audit committee financial expert” as defined by the SEC.


(1)	Includes amounts earned in fiscal year.

(2)	Performance Share Awards: On February 9, 2001, July 26, 2001, February 12, 2002, and February 11, 2003, the Personnel and Compensation Committee of the Board of Directors awarded performance share grants in the form of restricted stock under the 1997 Long-Term Incentive Plan. This restricted stock will vest only if certain performance targets are met during the three-year performance period. Mr. Brown was awarded 15,000 shares in 2001 (7,000 shares on February 9, 2001 and 8,000 shares on July 26, 2001), 15,000 shares in 2002 and 12,000 shares in 2003; Mr. Faig was awarded 5,000 shares in each of 2001 and 2002 and 4,000 shares in 2003; Mr. Lienesch was awarded 3,000 shares in each of 2001 and 2002 and 2,400 shares in 2003; Mr. O’Donnell was awarded 2,000 shares in each of 2001, 2002 and 2003; Mr. Anderson was awarded no shares in each of 2001 and 2002 and 1,600 shares in 2003; Mr. Francy was awarded 2,000 shares in each of 2001 and 2002 and 1,600 shares in 2003.


	In accordance with the terms of the Long-Term Incentive Plan, upon his retirement on September 30, 2003, Mr. Faig forfeited performance share grants as follows: from the 5,000 shares awarded him in 2001, 421 shares were forfeited; from the 5,000 shares awarded him in 2002, 2,087 shares were forfeited; and all 4,000 shares awarded him in 2003 were forfeited.

	The performance share grants awarded in 2001 were to vest only if the compounded annual growth rate of the company’s basic earnings per common share over the three-year performance period commencing January 1, 2001 was at least 10%. If the compounded annual growth rate of basic earnings per common share over the performance period was at least 12%, the awards were to be increased by a cash payment equal to 50% of the value of the associated performance share grant at the end of the performance period, and the cash payment was to be increased to 100% of the value of the associated performance share grant if that compounded annual growth rate was at least 15%. On February 9, 2004, all of the performance share grants awarded in 2001 were forfeited because the targeted annual growth rate in earnings per share was not attained.

	The performance share grants awarded in 2002 will vest only if the company’s basic earnings per common share over the three-year performance period commencing January 1, 2002 are at least $1.00. These grants will be increased by a cash payment equal to 50% of the value of the associated performance share grant at the end of the performance period if basic earnings per share over the performance period are at


	least $1.35, and the cash payment will be increased to 100% of the value of the associated performance share grant if those basic earnings per share are at least $1.75.

	The performance share grants awarded in 2003 will vest only if the company’s basic earnings per common share over the three-year performance period commencing January 1, 2003 are at least $0.75. These grants will be increased by a cash payment equal to 50% of the value of the associated performance share grant at the end of the performance period if basic earnings per share over the performance period are at least $1.15, and the cash payment will be increased to 100% of the value of the associated performance share grant if those basic earnings per share are at least $1.50.

	Restricted Stock Awards: On February 9, 2001, February 12, 2002 and November 6, 2003, the Personnel and Compensation Committee also awarded restricted stock under the 1994 and 1997 Long-Term Incentive Plans which vests at the end of 3 years (2 years in the case of 50% of each grant made in 2003) if the executive is still employed by the company or has retired from the company, but is not subject to other performance targets, as follows: Mr. Brown, 30,000 shares in 2002 and 160,000 shares in 2003; Mr. Faig, 15,000 shares in 2002; Mr. Lienesch, 15,000 shares in 2002 and 50,000 shares in 2003; Mr. O’Donnell, 10,000 shares in 2002 and 50,000 shares in 2003; Mr. Anderson, 1,000 shares in 2001 and 35,000 shares in 2003; and Mr. Francy, 5,000 shares in 2002 and 35,000 shares in 2003.

	The values of the awards under the Long-Term Incentive Plans shown in the table are based on the closing prices of $20.34 and $17.47 (for the February 9, 2001 and July 26, 2001 awards, respectively), $13.81 (for the February 12, 2002 awards), and $4.62 and $2.56 (for the February 11, 2003 and November 6, 2003 awards, respectively).

	Dividends are paid on all restricted stock granted under the Long-Term Incentive Plans at the same time and the same rate as dividends are paid to the shareholders on unrestricted stock.

	Upon a change in control of the company, all outstanding performance and restricted share awards immediately vest, and payments are made with respect to the performance shares as if maximum performance targets were attained. All outstanding restricted share awards vested and payments became due with respect to all outstanding performance shares on either April 15, 2004 or June 10, 2004 as a result of a change of control in connection with the Refinancing Transaction.

	NOTE: The total number of shares of restricted stock held, subject to vesting restrictions, by the listed officers and the aggregate market value at the end of the company’s fiscal year are as follows: Mr. Brown held 232,000 restricted shares valued at $967,440.00 in the aggregate; Mr. Faig held 22,492 restricted shares valued at $93,791.64 in the aggregate; Mr. Lienesch held 73,400 shares valued at $306,078.00 in the aggregate; Mr. O’Donnell held 66,000 shares valued at $275,220.00 in the aggregate; Mr. Anderson held 37,600 shares valued at $156,792.00 in the aggregate; and Mr. Francy held 45,600 shares valued at $190,152.00 in the aggregate. Aggregate market value is based on the closing price of $4.17 at December 31, 2003.


3)	Mr. Faig retired on September 30, 2003.

4)	Mr. Anderson became an executive officer of the company on October 1, 2002.

5)	Mr. Francy became an executive officer of the company on February 9, 2001.

6)	The Board of Directors approved bonuses to certain officers, at the discretion of the CEO, in recognition of extraordinary job demands required during the company’s refinancing process.

7)	Includes $20,834 for supplemental health care benefits received by Mr. Lienesch, which was the only perquisite or other personal benefit received by him that exceeded 25% of the total of all perquisites and other personal benefits received by him.


1)	Based on a fair market value (average of high and new low market prices) of company stock on December 31, 2003, of $4.18.

2)	As set forth below under the heading “Share Ownership of Directors and Executive Officers,” on April 21, 2003 Messrs. Anderson, Brown, Faig, Francy, Lienesch and O’Donnell voluntarily waived all right and interest to options to purchase 8,600 shares, 174,800 shares, 141,000 shares, 8,000 shares, 86,600 shares and 18,100 shares, respectively, none of which were in-the-money options. These waivers were made without any promise of future options being offered to these officers. The purpose of these waivers was to allow the Company to make future grants to participants under the company’s long-term incentive plans without increasing shareholder dilution, by making the shares related to the waivers available for such future grants.

The Personnel and Compensation Committee of the Board of Directors (the “Committee”) annually reviews and recommends to the full Board compensation levels for the officers of the company. The Committee consists entirely of independent, non-employee directors.

The Committee’s primary objective in establishing compensation opportunities for the company’s officers is to support the company’s goal of maximizing the shareholders’ value. To achieve this objective, the Committee believes it is critical to hire, develop, reward, and retain the most competent executives, and to establish total compensation opportunities for executives based upon competitive market conditions and the overall strategy of the company.

The Committee reviews the compensation for all corporate officers, including the individuals whose compensation is detailed in this Proxy Statement. This review is designed to ensure consistency throughout the compensation process. The Committee makes all decisions pertaining to the determination of the company’s executive compensation plans that promote the above objective. The Committee believes that the company’s current compensation programs support the company’s business mission and contribute to the company’s financial success. The Committee considers total compensation when establishing each component of pay.

The Omnibus Budget Reconciliation Act of 1993 added Section 162(m) to the Internal Revenue Code of 1986, as amended. Section 162(m) generally denies a publicly held corporation, such as the company, a federal income tax deduction for compensation in excess of $1 million per year paid or accrued for each of its chief executive officer and four other most highly compensated executive officers. Certain “performance based” compensation is not subject to the limitation of deductibility provided that certain stockholder approval and independent director requirements are met. The Committee takes into account Section 162(m) of the Internal Revenue Code while reviewing its policies with respect to the qualifying compensation paid to its executive officers.

The Committee annually reviews each officer’s base salary. The factors which influence Committee determinations regarding base salary include job performance, level of responsibilities, breadth of knowledge, prior experience, comparable levels of pay among executives at national market competitors, and internal pay equity considerations. Base pay data is compared with survey information compiled by independent compensation consulting firms. In 2003 the Committee retained Towers Perrin to conduct an independent compensation review to assist the Committee in establishing total compensation, including base pay and short and long-term compensation, for the company’s officers, including the CEO, and other key executives. Increases in salary levels are driven by individual performance. Base salaries are targeted at the market median, after adjusting for company size. Based on this independent review, the Committee determined that the current base salaries of the company’s officers are within acceptable competitive ranges.

Due to depressed economic and business conditions, the officers, including the CEO, elected to reduce their base salary by 8% throughout most of 2001 and 2002. Furthermore, after the 8% reduction was restored in October of 2002, the officers’ base salary remained frozen throughout 2003.

The company’s officers, including the CEO, are eligible for an annual cash bonus under its 2002 Short-Term Incentive Plan. The corporate and business unit performance measures for bonus payments are based on earning a return on capital in excess of the cost of capital (“EVA”) and meeting or exceeding predetermined Critical Success Factors, and thereby enhancing shareholder value at the corporate and/or business unit

The 2002 Short-Term Incentive Plan provides a balance between the short-term financial goals and long-term objectives of the company. Annual incentive compensation is targeted to the market median, after adjusting for company size. No bonus under the 2002 Short-Term Incentive Plan was paid to any of the officers named in the Summary Compensation Table for the 2003 plan year.

The 1997 Long-Term Incentive Plan was approved by shareholders in 1997 and gives the Committee the authority and discretion to award stock options, restricted stock and performance share awards (collectively referred to as “Awards”) to the company’s key employees. Awards are granted during the life of the Plan and are designed to align the interests of executives with those of the shareholders. Under the 1997 Long-Term Incentive Plan, Awards were granted to the company’s key employees, including its officers. Stock options have an exercise price equal to the market price of the company’s Common Stock on the date of the grant, and vest over a four-year period commencing on the first anniversary of the date of the grant. Stock options granted on or after February 19, 2002, have a life span of five years from the grant date and those granted prior thereto have a life span of 10 years from the date of the grant. There were no stock options granted in 2003 to any executive officer or employee of the company. On April 21, 2003, all named executive officers in the Summary Compensation Table voluntarily waived all right and interest to options to purchase 437,100 shares of Common Stock, none of which were in-the-money options. These waivers were made without any promise of future options being offered to these officers. The purpose of these waivers was to allow the company to make future grants to participants under the company’s long-term incentive plans without increasing shareholder dilution, by making shares related to the waivers available for such future grants.

Restricted stock may not be sold or transferred for a period of three years and, as a general rule, the restricted stock is forfeited if the recipient does not remain in the employ of the company during the entire three-year term.

Performance share grants are awarded in the form of restricted shares which may be forfeited or increased, with any increase paid in cash, depending on the growth of basic earnings per share of the company’s Common Stock during the three-year measurement period. Performance share grants awarded in 2001 for the 2001-2003 Performance Period were forfeited when the basic earnings per share growth target of 10% was not attained. Performance share grants awarded in 2002 for the 2002-2004 Performance Period will vest only if a basic earnings per share target of at least $1.00 is achieved, and will be increased by 50% or 100% if basic earnings per common share of at least $1.35 or $1.75, respectively, is achieved. Performance Share grants awarded in 2003 for the 2003-2005 Performance Period will vest only if a basic earnings per share target of at least $.75 per share is achieved, and will be increased by 50% or 100% if basic earnings per share of $1.15 or $1.50, respectively, is achieved. This approach to long-term incentives was designed to focus executives on the creation of shareholder value over the long term since the full breadth of the compensation package cannot be realized unless basic earnings per common share and the price of Common Stock increase over a number of years.

The compensation of the CEO reflects the same elements as those used in determining the compensation of other corporate officers. The Committee also considers the leadership and effectiveness of the CEO in offering direction and strategic planning for the company and in dealing with major corporate challenges and opportunities.

The CEO’s base salary of $600,000 was established upon Mr. Brown’s promotion to Chairman and CEO in June of 2001. Due to depressed economic and business conditions, the CEO elected to reduce his base salary by 8% throughout most of 2001 and 2002 and after restoring the reduction of 8% in October of 2002, kept his base salary frozen throughout 2003.

In accordance with the terms of the 2002 Short-Term Incentive Plan, no bonus was paid for the 2003 plan year.

During fiscal 2003, Mr. Brown was granted 12,000 performance shares under the 1997 Long-Term Incentive Plan and 160,000 shares of restricted stock under the 1994 Long-Term Incentive Plan. No stock options were granted in 2003.

Mr. Brown’s performance share grant is subject to the same performance targets outlined above. The restricted stock grant was made on the basis of market practice as determined by independent consultants, as described above.


	The Personnel and Compensation Committee

	James E. Perrella, Chairperson
	Joseph A. Pichler
	Joseph A. Steger

The following table sets forth information, unless otherwise indicated, as of June 18, 2004, concerning the beneficial owners of more than five percent of the Company’s outstanding shares of the company’s Common Stock, Series B Preferred Stock and 4% Cumulative Preferred Stock. Unless otherwise noted, the individuals or entities named in the table have sole voting and investment power.

(1)

The following chart sets forth the percentage of voting power of (a) the holders of our common stock, (b) the holders of our Series B Preferred Stock and (c) the holders of our 4% Cumulative Preferred Stock, giving effect solely to the Rights Offering, the reset of the conversion price of the Series B Preferred Stock, the exercise of the contingent warrants and payment of pay-in-kind dividends on the Series B Preferred Stock through to its mandatory conversion date (and without giving effect to any other transactions that we may enter into during the applicable periods that would result in additional dilution).


(a)	Each holder of common stock is entitled to one vote for each such share of common stock held. In this chart the voting power of common stock issued upon exercise of contingent warrants is attributed to holders of Series B Preferred Stock.

(b)	Each holder of 4% Cumulative Preferred Stock is entitled to 24 votes for each such share of 4% Preferred Stock held.

(c)	Assumes no pay-in-kind dividends on the Series B Preferred Stock have been paid.

(d)	Assumes full subscription of the rights offering based on the 35,659,859 shares of our common stock outstanding as of June 18, 2004 and redemption of 150,000 shares of Series B Preferred Stock with the proceeds from the rights offering.

(e)	The initial $2.00 per share conversion price of the Series B Preferred Stock is subject to a reset of $1.75 per share at the end of the second quarter of 2005 if a test contained in the Series B Preferred Stock based on our financial performance for 2004 is not satisfied.

(f)	Assumes that all contingent warrants and common stock issued upon exercise thereof continue to be held by holders of Series B Preferred Stock. The voting power of common stock issued upon exercise of the contingent warrants is attributed to holders of Series B Preferred Stock. The contingent warrants will be exercisable only if a test contained in the contingent warrants based on our financial performance for 2005 is not satisfied.


(g)	Assumes rights offering and redemption of Series B Preferred Stock occurred before September 1, 2004, reset of the Series B Preferred Stock conversion price to $1.75, exercise of the contingent warrants and that all contingent warrants and common stock issued upon exercise thereof continue to be held by holders of Series B Preferred Stock.


(2)	As reported in an Amendment to Schedule 13G dated February 9, 2004 filed with the SEC by Putnam, LLC (“Putnam”), a subsidiary of Marsh & McLennan Companies, Inc. (“MMc”), on behalf of MMc, on its own behalf and on behalf of its two registered investment advisory subsidiaries, Putnam Investment Management, LLC (advisor to the Putnam family of mutual funds) and The Putnam Advisory Company, LLC (advisor to Putnam’s institutional clients), with respect to 1,916,864 shares of Common Stock as to which Putnam and Putnam Investment Management, LLC reported shared dispositive power and with respect to 1,461,930 shares of Common Stock as to which Putnam and The Putnam Advisory Company, LLC reported shared dispositive power. Putnam and The Putnam Advisory Company, LLC also reported shared voting power with respect to 1,110,440 of the shares of Common Stock as to which they reported shared dispositive power.

(3)	As reported in an Amendment to Schedule 13G dated February 6, 2004 filed with the SEC by Dimensional Fund Advisors Inc., a registered investment advisor, with respect to shares of Common Stock held by funds as to which it serves as investment advisor or manager.

(4)	As reported in Schedule 13G dated February 17, 2004 filed with the SEC by U.S. Trust Corp., United States Trust Company of New York and U.S. Trust Company, N.A. with respect to 2,446,139 shares of Common Stock as to which they also report shared dispositive power.

(5)	As reported in an Amendment to Schedule 13D dated June 21, 2004 filed with the SEC by Glencore Finance AG on behalf of (i) Glencore Finance AG, Glencore International AG, and Glencore Holding AG, and (ii) Mizuho International and Mizuho Securities Co., Ltd. (Glencore has disclaimed beneficial ownership of the shares of Series B Preferred Stock held by Mizuho). In the Amendment to Schedule 13D, Glencore Finance AG also reported the sale on March 16, 2004 of an undivided 17.8571428% participation interest in its holdings of our then outstanding Series A Notes and Series B Notes to Triage Offshore Fund, Ltd. Glencore states in the amended Schedule 13D that, as of the date thereof, Triage Offshore, Ltd.’s participation interest is equivalent to 62,500 shares of Series B Preferred Stock. This interest is reflected in the holdings of both Glencore and Triage in the table above.

(6)	As reported in an Amendment to Schedule 13D dated June 21, 2004 filed with the SEC by Glencore Finance AG on behalf of Glencore and Mizuho (Mizuho has disclaimed beneficial ownership of the shares of Series B Preferred Stock held by Glencore).

(7)	As reported in Schedule 13D dated June 21, 2004 filed with the SEC by Triage Advisors, L.L.C., TRIAGE Management LLC, Triage Capital Management, L.P., Triage Capital Management B, L.P., Triage Offshore Fund, Ltd., and Leonid Frenkel (collectively, “Triage”), with respect to Triage Offshore Fund, Ltd.’s purchase of an undivided 17.8571428% participation interest from Glencore Finance AG in its holdings of our then outstanding Series A Notes and Series B Notes. Triage states in the Schedule 13D that as of the date thereof, its participation interest is equivalent to 62,500 shares of Series B Preferred Stock. This interest is reflected in the holdings of both Glencore Finance AG and Triage in the table above (Triage has disclaimed any group for purposes of Section 13(d) among itself, Glencore and Mizuho that may be found as a result of the participation agreement entered into March 16, 2004 between Triage Offshore Fund, Ltd. and Glencore Finance AG).

(8)	Includes both the 2,288,833 shares of Common Stock and the 11,126 shares of 4% Cumulative Preferred Stock beneficially owned by Boston Safe Deposit and Trust Company.

The following table sets forth the beneficial ownership of Common Stock, Series B Preferred Stock and 4% Cumulative Preferred Stock as of June 18, 2004, for each of the directors and for each of the executive officers named in the Summary Compensation Table.


(1)	The amounts shown include (a) the following shares that may be acquired within 60 days pursuant to outstanding option grants: Mr. Anderson 11,875 shares, Mr. Brown 260,000 shares, Mr. Faig 172,000 shares, Mr. Francy 15,000 shares, Mr. Lienesch 113,000 shares, Mr. O’Donnell 85,000 shares, 16,000 shares each for Messrs. Perrella and Steger, 14,000 shares for Mr. Allen, and Ms. Franklin, 10,000 shares for Mr. Burner, 3,000 shares for Mr. Turner, and 729,875 shares for all directors and executive officers as a group; (b) the following shares allocated to participant accounts under the Milacron Retirement Savings Plan, according to information furnished by the Plan Trustee: Mr. Anderson 1,319 shares, Mr. Brown 2,173 shares, Mr. Francy 857 shares, Mr. Lienesch 2,732 shares, Mr. O’Donnell 1,849 shares, and 8,930 shares for all directors and executive officers as a group; and (c) the following shares held by certain members of the individuals’ families as to which beneficial ownership is disclaimed: Mr. Brown 100 shares, and Mr. Turner 25 shares. On April 21, 2003, Messrs. Anderson, Brown, Faig, Francy, Lienesch and O’Donnell voluntarily waived all right and interest to options to purchase 8,600 shares, 174,800 shares, 141,000 shares, 8,000 shares, 86,600 shares and 18,100 shares, respectively, none of which were in-the-money options. These waivers were made without any promise of future options being offered to these officers. The purpose of these waivers was to allow the Company to make future grants to participants under the Company’s long-term incentive plans without increasing shareholder dilution, by making the shares related to the waivers available for such future grants.

(2)	The amounts shown do not include credits of stock units under the Company’s deferred compensation plan for non-employee directors as follows: Mr. Allen 50,243 units, Mr. Burner 34,956 units, Ms. Franklin 7,070 units, Mr. Perrella 49,144 units, Mr. Steger 13,258 units, and Mr. Turner 4,661 units.

(3)	The amounts shown do not include 3,913 shares of 4% Cumulative Preferred Stock held by the Milacron Geier Foundation (of which Messrs. Brown, Steger and Turner are Trustees), as to which shares beneficial ownership is disclaimed.

(4)	The amount shown, which is 70.0% of the outstanding Series B Preferred Stock, represents the shares owned by Glencore of which Mr. Isaacs has the right to direct dispositions and voting (Mr. Isaacs has disclaimed beneficial ownership to the 150,000 shares owned by Mizuho which were acquired in the same transaction in which Glencore acquired its shares). See footnotes 4 and 6 to the “Principal Holders of


	Voting Securities” table for information about Glencore’s sale of a participation interest in its investment in the Series B Preferred Stock to a third party.

(5)	The amount shown for Mr. Faig is based on his ownership as of April 15, 2004, adjusted to include options which have since become exercisable within 60 days.

(6)	Directors’ and executive officers’ beneficial ownership as a group is 2.9% of the outstanding Common Stock (12 persons) and 0.6% of the outstanding 4% Cumulative Preferred Stock (1 person).

During 2003 and through March 15, 2004, we had outstanding loans in excess of $60,000 to one executive officer under our employee stock loan program for the purposes of exercising stock options and purchasing stock, and for paying related withholding taxes due as a result of such actions or the lapse of restrictions on restricted stock, all under our long-term incentive plans. Mr. Brown had loans with interest rates ranging from 5.17% to 7.38%, with the largest aggregate amount of indebtedness outstanding at any time during such period being $167,709.04 and the principal balance of all such loans outstanding at the end of the period being $142,730.23. In 2002, we discontinued the employee stock loan program, allowing for the repayment of existing loans in accordance with their respective terms. Pursuant to the employee stock loan program, the loans are to be repaid on terms of regular payments of not more than ten years unless the related stock is divested by the employee prior to such time, in which case all amounts owing become payable. The interest rate for each loan was the Applicable Federal Rate in effect under Section 1274(d) of the Internal Revenue Code of 1986, as amended, as of the day on which the loan was made.

On March 12, 2004, we sold $70 million in aggregate principal amount of Series A Notes and Series B Notes to Glencore, of which Mr. Isaacs, a Director, is the Chairman and Managing Director. In addition, Glencore has informed us that it held $7.5 million of our 8 3/8% Notes due March 15, 2004, prior to their repayment, and €11.0 million of Eurobonds, prior to consummation of the tender offer. On April 15, 2004, Glencore converted its Series A Notes into 10,500,000 shares of our common stock. On June 10, 2004, the common stock into which the Series A Notes had been converted and the Series B Notes held by Glencore were exchanged for 350,000 shares of our Series B Preferred Stock, which represents approximately 40% of our outstanding equity. See footnotes 4 and 6 to the “Principal Holders of Voting Securities” table for information about Glencore’s sale of a participation interest in its investment in the Series B Preferred Stock to a third party. Mr. Isaacs was selected for nomination as a Director by Glencore and Mizuho as holders of the Series A Notes pursuant to the agreement governing the sale of such notes. For more information on this transaction, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Sources of Capital — March 12 Transactions” and “— June 10 Transactions.” In addition, Glencore purchased $9 million in principal amount of the original notes sold in a private placement on May 26, 2004.

In addition, Mizuho, a holder of 150,000 shares of our Series B Preferred Stock, which represents approximately 17% of our outstanding equity (on an as-converted basis), purchased $2 million in principal amount of the original notes.

Milacron Inc., Russell 2000 Index, S&P SmallCap 600 Indl Machinery Index and S&P 500 Index⁽²⁾


(1)	Total Shareholder Return assumes $100.00 invested on December 31, 1998 and reinvestment of dividends on a quarterly basis.

(2)	The S&P 500 Index (which was included in this graph in prior years) is being replaced with the S&P SmallCap 600 Industrial Machinery Index, which now includes the company and is more reflective of the company’s market capitalization.

On June 10, 2004, we entered into an asset based revolving credit facility for which JPMorgan Chase Bank acts as administrative agent (the “Agent”), collateral agent and a lender.

Set forth below is a summary of the terms and conditions of our asset based facility. This summary does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the credit agreement governing the asset based facility.

We and certain of our wholly-owned U.S. subsidiaries are joint and several borrowers under our asset based facility. Our asset based facility consists of a revolving line of credit in a maximum amount of up to $75.0 million (including up to $25.0 million of letters of credit) and matures on June 10, 2008. Our asset based facility provides that no letter of credit will have an expiration date later than the earlier of one year after its date of issuance or ten business days prior to the final maturity of our asset based facility, provided that any letter of credit may extend beyond the final maturity of our asset based facility if we provide cash collateral equal to at least 105% of the undrawn portion of such letter of credit on or prior to the tenth business day prior to the final maturity of our asset based facility.

Our ability to borrow, repay and reborrow loans and have letters of credit issued for our accounts is limited to a borrowing base equal to specified percentages of eligible U.S. and Canadian accounts receivable and U.S. inventory and is subject to other conditions to borrowing and limitations, including an excess availability reserve of $10.0 million, other reserve requirements, a limitation on inventory value, a $5 million limitation on the value of eligible Canadian accounts receivable and compliance with financial covenants.

Based upon the initial evaluation of our accounts receivable and inventory conducted by the Agent and the Lead Arranger, we have approximately $59 million of borrowing availability under our asset based facility, subject to the customary ability of the administrative agent for the lenders to reduce advance rates, impose or change collateral value limitations, establish reserves and declare certain collateral ineligible from time to time in its reasonable credit judgment, any of which could reduce our borrowing availability at any time.

The terms of our asset based facility impose a daily cash “sweep” on cash received in our U.S. bank accounts from collections of our accounts receivable. This daily cash “sweep” is automatically applied to pay down any outstanding borrowings under our asset based facility. The terms of our asset based facility also provide for the administrative agent, at its option and at any time, to impose a daily cash “sweep” on cash received in our Canadian bank accounts from collections of our accounts receivable.

We have the ability to prepay our asset based facility, in whole or in part, at any time without penalty (other than a fee of 1.0% of the facility amount if we terminate or are deemed to have terminated our asset based facility prior to June 10, 2005). Our asset based facility provides for mandatory prepayments (subject to exceptions), in general, of (i) 100% of the net cash proceeds received by us, another loan party under the credit agreement or any of our U.S. subsidiaries from non-ordinary course of business asset sales, (ii) 100% of the net cash proceeds received by us, another loan party under our asset based facility or any of our U.S. subsidiaries from casualty events which are not reinvested in accordance with the provisions of our asset based facility and (iii) 100% of the net cash proceeds received by us, another loan party under our asset based facility or any of our U.S. subsidiaries from any issuances of debt or equity, subject to limited exceptions to permit specified redemptions of preferred stock and the notes with proceeds of equity issuances. The credit agreement provides for mandatory prepayments in an amount equal to (i) any repayment required to be made

by us to Milacron Assurance Ltd. in connection with our self-insurance program, (ii) any cash payment made by any borrower or guarantor under our asset based facility in respect of a guarantee by us or another loan party under our asset based facility of a foreign subsidiary obligation and (iii) available cash in excess of $4 million.

Our asset based facility provides that funds drawn under our asset based facility can be used (i) to refinance existing indebtedness and to pay fees and expenses related thereto and (ii) for general corporate purposes.

Our obligations under our asset based facility are secured by (i) a first priority security interest in, subject to permitted liens, among other things, U.S. and Canadian cash, cash equivalents, deposit accounts, chattel paper, accounts receivable, inventory and, in the U.S., certain rights under contracts, licenses and other general intangibles relating to the foregoing, subject to certain exceptions, and (ii) a second priority security interest in substantially all other tangible and intangible property of the loan parties at any time owned or acquired in each case but only to the extent subject to a lien securing the notes.

Each of our existing and future material U.S. and Canadian subsidiaries that are not co-borrowers under our asset based facility and Milacron Capital Holdings B.V. guarantee our obligations under our asset based facility. We have the right to have Milacron Capital Holdings B.V. released from its guarantee at any time.

Our asset based facility contains representations and warranties (subject to materiality thresholds and other exceptions) customary for this type of financing including, among other things, those relating to: absence of litigation or commercial tort claims, absence of a material adverse change, compliance with laws, pension and benefit matters, taxes, nature of our business, absence of adverse agreements, compliance with permits, ownership of property, operating lease obligations, environmental matters, insurance, use of proceeds, intellectual property, material contracts, employee and labor matters, customers and suppliers, location of collateral, priority of the lenders’ liens and collateral matters.

Our asset based facility contains customary conditions precedent to any borrowings, as well as customary affirmative and negative covenants. Such covenants include, among other things: delivery requirements of financial statements and borrowing base certificates, field examination and inspection rights, additional guarantees and collateral, compliance with pension, environmental and other laws, maintenance of our properties and insurance, collateral matters, use of proceeds of loans and restrictions on our and our guarantors’ ability to do the following:


	•	incur liens;

	•	incur additional indebtedness;

	•	engage in mergers or dissolutions or sell or transfer our assets;

	•	change the nature of our business;

	•	enter into capital or operating leases;

	•	make capital expenditures;

	•	make loans, advances, guarantees or investments (including officer loans);


	•	pay dividends or make distributions or other restricted payments on our stock;

	•	enter into transactions with affiliates;

	•	create dividend or other payment restrictions affecting our subsidiaries;

	•	issue or sell our stock;

	•	amend or modify terms of certain indebtedness, organizational documents or other agreements;

	•	adjust accounts receivable; and

	•	engage in certain environmental and ERISA-related activities.

In addition, our asset based facility contains, for the first five quarters, a financial covenant requiring us to maintain a minimum level of cumulative consolidated EBITDA, to be tested quarterly, and a limit on capital expenditures to be complied with on a quarterly basis, in each case starting with the first full quarter after the closing. Thereafter, we are subject to a fixed charge coverage ratio to be tested quarterly.

Our asset based facility contains customary events of default, which are subject to customary grace periods and materiality standards, including, among others, events of default upon the occurrence of (i) nonpayment of any amounts payable under our asset based facility when due, (ii) any representation or warranty made by any borrower or guarantor under our asset based facility being incorrect in any material respect when made or deemed made, (iii) a breach by any borrower or guarantor of covenants or agreements under our asset based facility, (iv) failure to pay when due any other material indebtedness, or the occurrence of events or conditions that permit holders of other material indebtedness to cause it to become due, or any other material indebtedness is declared to be due or is required to be prepaid or repurchased prior to its stated maturity, (v) voluntary bankruptcy, insolvency or reorganization of any borrower, guarantor or any of their subsidiaries, (vi) involuntary bankruptcy, insolvency or reorganization of any borrower, guarantor or any of their subsidiaries that remains undismissed or unstayed for a period of 30 days, (vii) any term or provision of our asset based facility ceasing to be valid and binding on or enforceable against any borrower or guarantor or being contested against any party to our asset based facility, or any proceeding commenced by any borrower or guarantor or governmental authority seeking to establish the invalidity or unenforceability of any term or provision of our asset based facility, (viii) any security agreement or document under our asset based facility ceasing to create a lien on any assets securing our asset based facility, (ix) any judgment, order or award for the payment of money exceeding $2.5 million that is in effect for more than a specified period, (x) certain pension and benefit events, (xi) a “change of control,” as such term is defined under our asset based facility, or (xii) an event or development occurring which could reasonably be expected to have a “material adverse effect,” as such term is defined in the agreement governing our asset based facility.

Borrowings under our asset based facility bear interest, at our option, at either (i) the LIBO Rate plus the applicable margin (as defined below) or (ii) an ABR plus the applicable margin (as defined below). The “applicable margin,” with respect to Eurodollar loans, is between 2.50% per annum and 3.25% per annum and, with respect to ABR loans, is between 0.75% per annum and 1.50% per annum, determined based on a calculation of the trailing average availability levels under our asset based facility. LIBO Rate means the rate at which Eurodollar deposits in the London interbank market are quoted on page 3750 of the Dow Jones Market Service. We are able to elect Eurodollar loans interest periods of one, two or three months. “ABR” means the higher of (i) the rate of interest publicly announced by the Agent as its prime rate in effect at its principal office in New York City and (ii) the federal funds effective rate from time to time plus 0.5%.

Our asset based facility provides that upon the occurrence and continuance of an event of default under our asset based facility, upon demand by the Agent, we will have to pay (x) in the case of revolving credit loans, a rate of interest per annum equal to the rate of interest otherwise in effect (assuming the rate in effect is at the maximum applicable margin) pursuant to the terms of our asset based facility plus 2% and (y) in the case of other amounts, a rate of interest per annum equal to the ABR plus the maximum applicable margin plus 2%.

As of December 31, 2003, we had lines of credit with various U.S. and non-U.S. banks of approximately $29 million (excluding the then-existing senior credit facility) of which $14 million was outstanding (excluding the then-existing senior credit facility). These credit facilities support letters of credit and leases in addition to provide borrowings under varying terms. The weighted average interest rate on borrowings under lines of credit outstanding as of December 31, 2003 was 4.8%.

In connection with the sale of the original notes and the release of the proceeds from escrow, we entered into a registration rights agreement with the initial purchasers, under which we agreed to use our reasonable best efforts to file and have declared effective a registration statement under the Securities Act relating to the exchange offer.

We are making the exchange offer in reliance on the position of the SEC as set forth in certain no-action letters. However, we have not sought our own no-action letter. Based upon these interpretations by the SEC, we believe that a holder of exchange notes, but not a holder who is our “affiliate” within the meaning of Rule 405 of the Securities Act, who exchanges original notes for exchange notes in the exchange offer generally may offer the exchange notes for resale, sell the exchange notes and otherwise transfer the exchange notes without further registration under the Securities Act and without delivery of a prospectus that satisfies the requirements of Section 10 of the Securities Act. This does not apply, however, to a holder who is our “affiliate” within the meaning of Rule 405 of the Securities Act. We also believe that a holder may offer, sell or transfer the exchange notes only if the holder acquires the exchange notes in the ordinary course of its business and is not participating, does not intend to participate and has no arrangement or understanding with any person to participate in a distribution of the exchange notes.

Any holder of the original notes using the exchange offer to participate in a distribution of exchange notes cannot rely on the no-action letters referred to above. Any broker-dealer who holds original notes acquired for its own account as a result of market-making activities or other trading activities and who receives exchange notes in exchange for such original notes pursuant to the exchange offer may be a statutory underwriter and must deliver a prospectus meeting the requirements of the Act in connection with any resale of such exchange notes.

Each broker-dealer that receives exchange notes for its own account in exchange for original notes, where such original notes were acquired by such broker dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for original notes where such original notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. The letter of transmittal states that by acknowledging and delivering a prospectus, a broker-dealer will not be considered to admit that it is an “underwriter” within the meaning of the Securities Act. We have agreed that for a period of not less than 180 days after the Expiration Date, we will make this prospectus available to broker-dealers for use in connection with any such resale. See “Plan of Distribution.”

Except as described above, this prospectus may not be used for an offer to resell, resale or other transfer of exchange notes.

The exchange offer is not being made to, nor will we accept tenders for exchange from, holders of original notes in any jurisdiction in which the exchange offer or the acceptance of it would not be in compliance with the securities or blue sky laws of such jurisdiction.

Upon the terms and subject to the conditions of the exchange offer, we will accept any and all original notes validly tendered prior to 5:00 p.m., New York time, on the Expiration Date. The date of acceptance for exchange of the original notes, and completion of the exchange offer, is the exchange date, which will be the first business day following the Expiration Date. We will issue, on or promptly after the exchange date, an aggregate principal amount of up to $225.0 million of exchange notes for a like principal amount of outstanding original notes tendered and accepted in connection with the exchange offer. The exchange notes issued in connection with the exchange offer will be delivered on the earliest practicable date following the exchange date. Holders may tender some or all of their original notes in connection with the exchange offer, but only in $1,000 increments of principal amount at maturity.

The terms of the exchange notes are identical in all material respects to the terms of the original notes, except that the exchange notes have been registered under the Securities Act and are issued free from any covenant regarding registration, including the payment of additional interest upon a failure to file or have declared effective an exchange offer registration statement or to complete the exchange offer by certain dates. The exchange notes will evidence the same debt as the original notes and will be issued under the same indenture and entitled to the same benefits under that indenture as the original notes being exchanged. As of the date of this prospectus, $225 million in aggregate principal amount of the original notes is outstanding.

In connection with the issuance of the original notes, we arranged for the original notes purchased by qualified institutional buyers and those sold in reliance on Regulation S under the Securities Act to be issued and transferable in book-entry form through the facilities of The Depository Trust Company (“DTC”), acting as depositary. Except as described under “— Exchange of Global Notes for Certificated Notes,” exchange notes will be issued in the form of a global note registered in the name of DTC or its nominee and each beneficial owner’s interest in it will be transferable in book-entry form through DTC. See “— Book-Entry, Delivery and Form.”

Holders of original notes do not have any appraisal or dissenters’ rights in connection with the exchange offer. Original notes which are not tendered for exchange or are tendered but not accepted in connection with the exchange offer will remain outstanding and be entitled to the benefits of the indenture under which they were issued, but certain registration and other rights under the registration rights agreement will terminate and holders of the original notes will generally not be entitled to any registration rights under the registration rights agreement.

We shall be considered to have accepted validly tendered original notes if and when we have given oral or written notice to the exchange agent. The exchange agent will act as agent for the tendering holders for the purposes of receiving the exchange notes from us.

If any tendered original notes are not accepted for exchange because of an invalid tender, the occurrence of certain other events described in this prospectus or otherwise, we will return the original notes, without expense, to the tendering holder promptly after the Expiration Date.

Holders who tender original notes will not be required to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal, transfer taxes on exchange of original notes in connection with the exchange offer. We will pay all charges and expenses, other than certain applicable taxes described below, in connection with the exchange offer. See“— Fees and Expenses.”

The Expiration Date for the exchange offer is 5:00 p.m., New York City time, on , 2004, unless extended by us in our sole discretion, in which case the term “Expiration Date” shall mean the latest date and time to which the exchange offer is extended.


	•	to delay accepting any original notes, to extend the exchange offer or to terminate the exchange offer if, in our reasonable judgment, any of the conditions described below shall not have been satisfied, by giving oral or written notice of the delay, extension or termination to the exchange agent, or

	•	to amend the terms of the exchange offer in any manner.

If we amend the exchange offer in a manner that we consider material, we will disclose such amendment by means of a prospectus supplement, and we will extend the exchange offer for a period of five to ten business days.

If we determine to extend, amend or terminate the exchange offer, we will publicly announce this determination by making a timely release through an appropriate news agency.

Interest on the exchange notes will accrue at the rate of 11 1/2% per annum from the last date to which interest was paid on the original notes surrendered in exchange therefore or if no interest has been paid on such original notes, from the date of the issuance of the original notes. Interest will be payable semiannually in arrears on May 15 and November 15 of each year, commencing on November 15, 2004.

Despite any other term of the exchange offer, we will not be required to accept for exchange, or to exchange any exchange notes for, any original notes and may terminate the exchange offer as provided in this prospectus before the acceptance of the original notes, if prior to the Expiration Date:


	•	any action or proceeding is instituted or threatened in any court or by or before any governmental agency relating to the exchange offer which, in our reasonable judgment, might materially impair the contemplated benefits of the exchange offer to us, or any material adverse development has occurred in any existing action or proceeding relating to us or any of our subsidiaries

	•	any change, or any development involving a prospective change, in our business or financial affairs or any of our subsidiaries has occurred which, in our reasonable judgment, might materially impair our ability to proceed with the exchange offer or materially impair the contemplated benefits of the exchange offer to us;

	•	any law, statute, rule or regulation is proposed, adopted or enacted which in our reasonable judgment might materially impair our ability to proceed with the exchange offer; or

	•	any governmental approval has not been obtained, which approval we, in our reasonable discretion, consider necessary for the completion of the exchange offer as contemplated by this prospectus.

The conditions listed above are for our sole benefit and may be asserted by us regardless of the circumstances giving rise to any of these conditions. We may waive these conditions in our reasonable discretion in whole or in part at any time and from time to time. The failure by us at any time to exercise any of the above rights shall not be considered a waiver of such right, and such right shall be considered an ongoing right which may be asserted at any time and from time to time.

If we determine in our reasonable discretion that any of the conditions are not satisfied, we may:


	•	refuse to accept any original notes and return all tendered original notes to the tendering holders;

	•	extend the exchange offer and retain all original notes tendered before the expiration of the exchange offer, subject, however, to the rights of holders to withdraw those original notes (See “— Withdrawal of Tenders” below); or

	•	waive unsatisfied conditions relating to the exchange offer and accept all properly tendered original notes which have not been withdrawn.

Unless the tender is being made in book-entry form, to tender in the exchange offer, a holder must


	•	complete, sign and date the letter of transmittal, or a facsimile of it,

	•	have the signatures guaranteed if required by the letter of transmittal, and

	•	mail or otherwise deliver the letter of transmittal or the facsimile, the original notes and any other required documents to the exchange agent prior to 5:00 p.m., New York City time, on the Expiration Date.

Any financial institution that is a participant in DTC’s Book-Entry Transfer Facility system may make book-entry delivery of the original notes by causing DTC to transfer the original notes into the exchange agent’s account. Although delivery of original notes may be effected through book-entry transfer into the

exchange agent’s account at DTC, the letter of transmittal (or facsimile), with any required signature guarantees and any other required documents, must, in any case, be transmitted to and received or confirmed by the exchange agent at its addresses set forth under the caption “exchange agent” below, prior to 5:00 p.m., New York City time, on the Expiration Date. Delivery of documents to DTC in accordance with its procedures does not constitute delivery to the exchange agent.

The tender by a holder of original notes will constitute an agreement between us and the holder in accordance with the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal.

The method of delivery of original notes and the letter of transmittal and all other required documents to the exchange agent is at the election and risk of the holders. Instead of delivery by mail, we recommend that holders use an overnight or hand delivery service. In all cases, holders should allow sufficient time to assure delivery to the exchange agent before the Expiration Date. No letter of transmittal or original notes should be sent to us. Holders may request their respective brokers, dealers, commercial banks, trust companies or nominees to effect the tenders for such holders.

Any beneficial owner whose original notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and who wishes to tender should contact the registered holder promptly and instruct such registered holder to tender on behalf of the beneficial owner. If the beneficial owner wishes to tender on that owner’s own behalf, the owner must, prior to completing and executing the letter of transmittal and delivery of such owner’s original notes, either make appropriate arrangements to register ownership of the original notes in the owners’ name or obtain a properly completed bond power from the registered holder. The transfer of registered ownership may take considerable time.

Signature on a letter of transmittal or a notice of withdrawal must be guaranteed by an eligible guarantor institution within the meaning of Rule 17Ad-15 under the Securities Exchange Act of 1934, unless the original notes tendered pursuant thereto are tendered:


	•	by a registered holder who has not completed the box entitled “Special Issuance Instructions” or “Special Delivery Instructions” on the letter of transmittal, or

	•	for the account of an eligible guarantor institution.

In the event that signatures on a letter or transmittal or a notice of withdrawal are required to be guaranteed, such guarantee must be by:


	•	a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc.,

	•	a commercial bank or trust company having an office or correspondent in the United States, or

	•	an “eligible guarantor institution.”

If the letter of transmittal is signed by a person other than the registered holder of any original notes, the original notes must be endorsed by the registered holder or accompanied by a properly completed bond power, in each case signed or endorsed in blank by the registered holder.

If the letter of transmittal or any original notes or bond powers are signed or endorsed by trustees, executors, administrators, guardians, attorney-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and, unless waived by us, submit evidence satisfactory to us of their authority to act in that capacity with the letter of transmittal.

We will determine all questions as to the validity, form, eligibility (including time of receipt) and acceptance and withdrawal of tendered original notes in our sole discretion. We reserve the absolute right to reject any and all original notes not properly tendered or any original notes whose acceptance by us would, in the opinion of our counsel, be unlawful. We also reserve the right to waive any defects, irregularities or conditions of tender as to any particular original notes either before or after the Expiration Date. Our interpretation of the terms and conditions of the exchange offer (including the instructions in the letter of

transmittal) will be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of original notes must be cured within a time period we will determine. Although we intend to request the exchange agent to notify holders of defects or irregularities relating to tenders of original notes, neither we, the exchange agent nor any other person will have any duty or incur any liability for failure to give such notification. Tenders of original notes will not be considered to have been made until such defects or irregularities have been cured or waived. Any original notes received by the exchange agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned by the exchange agent to the tendering holders, unless otherwise provided in the letter of transmittal, promptly following the Expiration Date.

In addition, we reserve the right, as set forth above under the caption “— Conditions to the Exchange Offer,” to terminate the exchange offer.


	•	the exchange notes acquired in connection with the exchange offer are being obtained in the ordinary course of business of the person receiving the exchange notes, whether or not such person is the holder;

	•	neither the holder nor any such other person has an arrangement or understanding with any person to participate in the distribution of such exchange notes; and

	•	neither the holder nor any such other person is our “affiliate” (as defined in Rule 405 under the Securities Act).

Each broker-dealer that receives exchange notes for its own account in exchange for original notes, such original notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, much acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. See “Plan of Distribution.”


	•	whose original notes are not immediately available;

	•	who cannot deliver the holder’s original notes, the letter of transmittal or any other required documents to the exchange agent prior to the Expiration Date; or

	•	who cannot complete the procedures for book-entry transfer before the Expiration Date


	•	the tender is made through an eligible guarantor institution;

	•	before the Expiration Date, the exchange agent receives from the eligible guarantor institution:


	•	a properly completed and duly executed notice of guaranteed delivery by facsimile transmission, mail or hand delivery,

	•	the name and address of the holder, and

	•	the certificate number(s) of the original notes and the principal amount at maturity of original notes tendered, stating that the tender is being made and guaranteeing that, within three New York Stock Exchange trading days after the Expiration Date, the letter of transmittal and the certificate(s) representing the original notes (or a confirmation of book-entry transfer), and any other documents required by the letter of transmittal will be deposited by the eligible guarantor institution with the exchange agent; and


	•	the exchange agent receives, within three New York Stock Exchange trading days after the Expiration Date, a properly completed and executed letter of transmittal or facsimile, as well as the certificate(s)


		representing all tendered original notes in proper form for transfer or a confirmation of book-entry transfer, and all other documents required by the letter of transmittal.

Except as otherwise provided herein, tenders of original notes may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date.

To withdraw a tender of original notes in connection with the exchange offer, a written facsimile transmission notice of withdrawal must be received by the exchange agent at its address set forth herein prior to 5:00 p.m., New York City time, on the Expiration Date. Any such notice of withdrawal must:


	•	specify the name of the person who deposited the original notes to be withdrawn,

	•	identify the original notes to be withdrawn (including the certificate number or numbers and principal amount at maturity of such original notes),

	•	be signed by the depositor in the same manner as the original signature on the letter of transmittal by which such original notes were tendered (including any required signature guarantees) or be accompanied by documents of transfer sufficient to have the trustee register the transfer of such original notes into the name of the person withdrawing the tender, and

	•	specify the name in which any such original notes are to be registered, if different from that of the depositor.

We will determine all questions as to the validity, form and eligibility (including time of receipt) of such withdrawal notices. Any original notes so withdrawn will be considered not to have been validly tendered for purposes of the exchange offer, and no exchange notes will be issued unless the original notes withdrawn are validly re-tendered. Any original notes which have been tendered but which are not accepted for exchange or which are withdrawn will be returned to the holder without cost to such holder as soon as practicable after withdrawal, rejection of tender or termination of the exchange offer. Properly withdrawn original notes may be re-tendered by following one of the procedures described above under “— Procedures for Tendering” at any time prior to the Expiration Date.

U.S. Bank National Association has been appointed as exchange agent in connection with the exchange offer. Questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal should be directed to the exchange agent, at the address, telephone and facsimile numbers set forth below:

The exchange agent’s telephone number is (800) 934-6802 and facsimile number is (651) 495-8158.

We will not make any payment to brokers, dealers or others soliciting acceptances of the exchange offer. We will pay certain other expenses to be incurred in connection with the exchange offer, including the fees and expenses of the exchange agent and certain accounting and legal fees.

Holders who tender their original notes for exchange will not be obligated to pay transfer taxes. If, however:


	•	exchange notes are to be delivered to, or issued in the name of, any person other than the registered holder of the original notes tendered, or

	•	tendered original notes are registered in the name of any person other than the person signing the letter of transmittal, or

	•	a transfer tax is imposed for any reason other than the exchange of original notes in connection with the exchange offer,

then the amount of any such transfer taxes (whether imposed on the registered holder or any other persons) will be payable by the tendering holder. If satisfactory evidence of payment of such taxes or exemption from them is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed directly to the tendering holder.

The exchange notes will be recorded at the same carrying value as the original notes as reflected in our accounting records on the date of the exchange. Accordingly, we will not recognize any gain or loss for accounting purposes upon the completion of the exchange offer. The expenses of the exchange offer that we pay will increase our deferred financing costs in accordance with generally accepted accounting principles.

Consequences of Failures to Properly Tender Original Notes in the Exchange Offer

Issuance of the exchange notes in exchange for the original notes under the exchange offer will be made only after timely receipt by the exchange agent of such original notes, of a properly completed and duly executed letter of transmittal and all other required documents. Therefore, holders of the original notes desiring to tender such original notes in exchange for exchange notes should allow sufficient time to ensure timely delivery. We are under no duty to give notification of defects or irregularities of tenders of original notes for exchange. Original notes that are not tendered or that are tendered but not accepted by us will, following completion of the exchange offer, continue to be subject to the existing restrictions upon transfer thereof under the Securities Act, and, upon completion of the exchange offer, certain registration rights under the registration rights agreement will terminate.

In the event the exchange offer is completed, we generally will not be required to register the remaining original notes subject to limited exceptions. Remaining original notes will continue to be subject to the following restrictions on transfer:


	•	the remaining original notes may be resold only if registered pursuant to the Securities Act, if any exemption from registration is available, or if neither such registration nor such exemption is required by law, and

	•	the remaining original notes will bear a legend restricting transfer in the absence of registration or an exemption.

We do not currently anticipate that we will register the remaining original notes under the Securities Act. To the extent that original notes are tendered and accepted in connection with the exchange offer, any trading market for remaining original notes could be adversely affected. See “Risk Factors — Risks Related to Our Liquidity, the Notes and Our Other Indebtedness.” If you fail to exchange your original notes, they will continue to be restricted securities and may become less liquid.”

On May 26, 2004 the original notes were issued by Milacron Escrow Corporation, a wholly owned, direct subsidiary of Milacron Inc. created solely to issue the notes and to merge with and into Milacron Inc. with Milacron Inc. as the surviving corporation. We refer to this merger in this section as the Escrow Merger. The original notes were issued under an indenture dated May 26, 2004 between Milacron Escrow Corporation and U.S. Bank Trust National Association, as trustee, in a private placement not subject to the registration requirements of the Securities Act. The proceeds of the issuance of original notes were initially placed into escrow. On June 10, 2004, the conditions for release of the proceeds from escrow were satisfied, including the consummation of the Escrow Merger, and Milacron Inc. and the Guarantors executed and delivered a supplemental indenture. As a result, Milacron Inc. has become obligated on the notes. In this description, references to “Milacron,” the “Company,” “we,” “us,” or “our” refer only to Milacron Inc. and not to any of its subsidiaries.

The exchange notes will be issued under the same indenture and will be identical in all material respects to the original notes, except that the exchange notes have been registered under the Securities Act of 1933 and are free of any obligation regarding registration, including the payment of additional interest upon failure to file or have declared effective an exchange offer registration statement or to consummate an exchange offer by certain dates. Unless specifically stated to the contrary, the following description by reference to the term “notes” applies equally to the exchange notes and the original notes. The terms of the notes include those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act of 1939, as amended.

The security documents referred to below under the caption “— Security” contain the terms of the security arrangements that will secure the notes. The notes are secured only by the Collateral described under the caption “— Security.”

The following description is a summary of the material provisions of the indenture, the registration rights agreement, the intercreditor agreement and the security documents. It does not restate those agreements in their entirety. We urge you to read the indenture, the registration rights agreement, the intercreditor agreement and the security documents because they, and not this description, define your rights as Holders of the notes. Copies of the indenture, the registration rights agreement, the intercreditor agreement and the security documents are available as set forth below under the caption “— Additional Information.” Certain defined terms used in this description but not defined below under the caption “— Certain Definitions” have the meanings assigned to them in the indenture.

The registered Holder of a note will be treated as the owner of it for all purposes. Only registered Holders will have rights under the indenture.


	•	are general obligations of the Company;

	•	are secured by a first priority security interest (subject to Permitted Prior Liens) on the Company’s ownership interests in the Senior Secured Note Priority Collateral;

	•	are secured by a second priority security interest (subject to Credit Facility Liens and other Liens, if any, permitted by the applicable Qualified Credit Facility to be prior to the Credit Facility Liens) on the Company’s ownership interests in the Credit Facility Priority Collateral;

	•	ranks pari passu in right of payment with all existing and future unsubordinated Indebtedness of the Company, including Indebtedness under the ABL Facility (subject to the effective subordination of the notes in respect of the ABL Facility to the extent of the Credit Facility Priority Collateral);


	•	rank senior in right of payment to any future Indebtedness of the Company that is expressly subordinated to the notes;

	•	are effectively junior in right of payment to all existing and future liabilities, including trade payables, of the Company’s non-guarantor subsidiaries, including borrowings under any Credit Facility; and

	•	are unconditionally guaranteed by the Guarantors;

Under certain circumstances, additional Indebtedness of the Company may be secured by first or second priority security interests in the Credit Facility Priority Collateral or the Senior Secured Note Priority Collateral, and in either case the portion of the proceeds of such collateral to which Holders of the notes would be entitled, if any, would be further diluted.

The notes are guaranteed by all of the Company’s Domestic Restricted Subsidiaries that are not Immaterial Subsidiaries and by any additional Restricted Subsidiaries that guarantee Credit Facility Debt for so long as such Restricted Subsidiaries continue to guarantee Credit Facility Debt or other Indebtedness of the Company or any Guarantor, which Restricted Subsidiaries initially consist of the Canadian Restricted Subsidiaries and Milacron Capital Holdings B.V.


	•	is a general obligation of that Guarantor;

	•	is secured by a first priority security interest (subject to Permitted Prior Liens) on that Guarantor’s ownership interests in the Senior Secured Note Priority Collateral;

	•	is secured by a second priority security interest (subject to Credit Facility Liens and other Liens, if any, permitted by the applicable Qualified Credit Facility to be prior to the Credit Facility Liens) on that Guarantor’s ownership interests in the Credit Facility Priority Collateral;

	•	ranks pari passu in right of payment with all existing and future unsubordinated Indebtedness of that Guarantor, including Indebtedness under the ABL Facility (subject to the effective subordination of the Guarantee in respect of the ABL Facility to the extent of the Credit Facility Priority Collateral); and

	•	ranks senior in right of payment to any future Indebtedness of that Guarantor that is expressly subordinated to the Guarantee.

Under certain circumstances, additional Indebtedness of a Guarantor may be secured by first or second priority security interests in the Credit Facility Priority Collateral or the Senior Secured Note Priority Collateral, and in either case the portion of the proceeds of such collateral to which holders of the notes would be entitled, if any, would be further diluted.

Not all of our subsidiaries guarantee the notes. In the event of a bankruptcy, liquidation or reorganization of any of these nonguarantor subsidiaries, the nonguarantor subsidiaries will pay the holders of their debt and their trade creditors before they will be able to distribute any of their assets to us. The Guarantors generated approximately 65% of Milacron’s consolidated sales during the fiscal year ended December 31, 2003 and 62% of Milacron’s consolidated sales during the first quarter of 2004 and held approximately 51% of Milacron’s total assets, excluding intercompany amounts, as of March 31, 2004.

All of our subsidiaries are “Restricted Subsidiaries.” However, under the circumstances described below under the caption “— Certain Covenants — Designation of Restricted and Unrestricted Subsidiaries,” we are permitted to designate certain of our subsidiaries as “Unrestricted Subsidiaries.” Our Unrestricted Subsidiaries will not be subject to the restrictive covenants in the indenture. Our Unrestricted Subsidiaries will neither guarantee the notes nor grant any Liens in their property to secure repayment of the notes.

Pursuant to the security documents and the intercreditor agreement, the Liens granted in favor of the Holders of the Senior Secured Note Obligations in the Credit Facility Priority Collateral are junior and

subordinate in priority to any and all Liens on the Credit Facility Priority Collateral at any time granted to secure Credit Facility Obligations, which includes the ABL Facility and related Hedging Obligations. As of June 10, 2004, after giving effect to the initial borrowings and issuances of letters of credit under the ABL Facility, we had approximately $24.7 million of Indebtedness outstanding under the ABL Facility, with approximately $24.4 million in undrawn availability. These amounts would be secured by first priority Liens on the Credit Facility Priority Collateral and second priority Liens on the Senior Secured Note Priority Collateral. In addition, under the indenture, we may incur additional Credit Facility Debt secured by first priority Liens on the Credit Facility Priority Collateral. See “Risk Factors — Risks Relating to Our Liquidity, the Notes and Our Other Indebtedness — Our indebtedness under our asset based facility is effectively senior to the notes to the extent of the value of the collateral securing our asset based facility on a first priority basis and the lien ranking provisions of the indenture and the intercreditor agreement relating to the collateral securing our asset based facility limit the rights of holders of the notes with respect to that collateral” and “— The notes are effectively junior to the indebtedness and other liabilities of our nonguarantor subsidiaries.”

$225.0 million aggregate principal amount of original notes were issued on May 26, 2004. The Company may issue up to $50.0 million aggregate principal amount of additional notes from time to time. Any offering of additional notes is subject to the covenant described below under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock” and “— Liens.” The notes and any additional notes subsequently issued under the indenture will be treated as a single class for all purposes under the indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. The Company will issue notes in denominations of $1,000 and integral multiples of $1,000. The notes will mature on May 15, 2011.

Interest on the notes accrues at the rate of 11 1/2% per annum, payable semi-annually in arrears on May 15 and November 15, commencing on November 15, 2004. The Company will make each interest payment to the Holders of record on the immediately preceding May 1 and November 1.

Interest on the exchange notes will accrue from the date of original issuance or, if interest has already been paid on the original notes, from the date it was most recently paid. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

If a Holder has given wire transfer instructions to the Company, the Company will pay all principal, interest and premium and Liquidated Damages, if any, on that Holder’s notes in accordance with those instructions. All other payments on notes will be made at the office or agency of the paying agent and registrar within the City and State of New York unless the Company elects to make interest payments by check mailed to the Holders at their address set forth in the register of Holders.

The trustee will initially act as paying agent and registrar. The Company may change the paying agent or registrar without prior notice to the Holders of the notes, and the Company or any of its Subsidiaries may act as paying agent or registrar.

A Holder may transfer or exchange notes in accordance with the indenture. The registrar and the trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents in connection with a transfer of notes. Holders will be required to pay all taxes due on transfer. The Company is not required to transfer or exchange any note selected for redemption. Also, the Company is not required to transfer or exchange any note for a period of 15 days before a selection of notes to be redeemed.

The notes will be guaranteed by each of the Company’s current and future Domestic Restricted Subsidiaries and Canadian Restricted Subsidiaries that are not Immaterial Subsidiaries. These Guarantees are joint and several Obligations of the Guarantors. The obligations of each Guarantor under its Guarantee are limited as necessary to prevent that Guarantee from constituting a fraudulent conveyance under applicable law. See “Risk Factors — Risks Related to Our Liquidity, the Notes and Our Other Indebtedness — Federal and state statutes allow courts, under specific circumstances, to void debts, including guarantees, and liens that secure the debt and guarantees and require noteholders to return payments received from us or the guarantors. The guarantees will contain terms intended to limit the amount guaranteed to the extent necessary to prevent the guarantees from constituting fraudulent conveyances.”

The Guarantee of each Guarantor ranks pari passu in right of payment with all existing and future unsubordinated indebtedness of that Guarantor, and is secured by a first priority security interest (subject to Permitted Prior Liens) on that Guarantor’s ownership interests in the Senior Secured Note Priority Collateral and by a second priority security interest (subject to Permitted Prior Liens and Credit Facility Liens and other Liens, if any, permitted by the applicable Qualified Credit Facility to be prior to the Credit Facility Liens) on that Guarantor’s ownership interests in the Credit Facility Priority Collateral.

The indenture provides that, subject to the provisions of this paragraph, no Guarantor may sell or otherwise dispose of all or substantially all of its assets to, or consolidate with, merge or amalgamate with or into (whether or not such Guarantor is the surviving Person), another Person, other than the Company or another Guarantor, unless:


	(1) immediately after giving effect to that transaction, no Default or Event of Default exists; and

	(2) if the Person acquiring the property in any such sale or disposition or the Person formed by or surviving any such consolidation, merger or amalgamation is a Restricted Subsidiary, such Person assumes all the obligations of that Guarantor under the indenture, its Guarantee and all security documents delivered by that Guarantor pursuant to a supplemental indenture and other documentation in form and substance satisfactory to the trustee, and the Capital Stock of the successor resultant Person or transferee Person is pledged to the collateral agent for the benefit of the Holders of the Senior Secured Note Obligations pursuant to the security documents.

The Guarantee of a Guarantor will be released and the Guarantor relieved of any obligation under its Guarantee:


	(1) in connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by way of merger or consolidation) to a Person that is not (either immediately before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company, if the sale or other disposition is not in violation of the “Asset Sale” provisions of the indenture;

	(2) in connection with any direct or indirect sale of all of the Capital Stock of a Guarantor to a Person that is not (either immediately before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company, if the sale is not in violation of the “Asset Sale” provisions of the indenture;

	(3) with the written consent of the holders of at least 66 2/3% of the aggregate principal amount of notes then outstanding;

	(4) upon the Legal Defeasance or Covenant Defeasance of the notes in accordance with the terms of the indenture;

	(5) if the Company designates any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in accordance with the applicable provisions of the indenture; or

	(6) if the Guarantor is not a Domestic Restricted Subsidiary, when it ceases to be a guarantor or otherwise provide direct credit support for any other Indebtedness of the Company or any Guarantor.

Under any of the circumstances described in clauses (1) through (6) above, the applicable Guarantor or Guarantors will be released from all obligations under the security documents, the security interests in such Guarantor’s or Guarantors’ assets created pursuant to the security documents will be released and, upon any of the circumstances described in clauses (1), (2) or (4) above, the Capital Stock of such Guarantor or Guarantors will be released from the security interests created pursuant to the security documents, and in each case all Holders of the notes will be deemed to have consented to the foregoing releases. At the request of the Company, the trustee will execute and deliver any documents, instructions or instruments giving effect to, and evidencing the consent of the Holders to, any such release.

The obligations of the Company with respect to the notes, the obligations of the Guarantors under the guarantees, and the performance of all other obligations of the Company, the Guarantors and the Company’s other Restricted Subsidiaries under the Senior Secured Note Documents are secured equally and ratably by first priority security interests (subject to Permitted Prior Liens) in the Senior Secured Note Priority Collateral and second priority security interests in the Credit Facility Priority Collateral (subject to Permitted Prior Liens and Credit Facility Liens and other Liens, if any, permitted by applicable Qualified Credit Facility to be prior to such Credit Facility Liens), in each case granted to the collateral agent for the benefit of the Holders of the Senior Secured Note Obligations. The Credit Facility Obligations of the Company and the Guarantors are secured by first priority security interests (subject to Liens, if any, permitted by applicable Qualified Credit Facility to be prior to such Credit Facility Liens) in the Credit Facility Priority Collateral and second priority security interests (subject to Senior Secured Note Liens and Permitted Prior Liens) in the Senior Secured Note Priority Collateral.

The Senior Secured Note Liens on the Credit Facility Priority Collateral are junior in priority to the Credit Facility Liens and other Liens, if any, permitted by applicable Qualified Credit Facility to be prior to such Credit Facility Liens on the Credit Facility Priority Collateral. The Credit Facility Liens on the Senior Secured Note Priority Collateral are junior in priority to the Senior Secured Notes Liens and other Permitted Prior Liens on the Senior Secured Note Priority Collateral. The Senior Secured Note Priority Collateral and Credit Facility Priority Collateral together comprise substantially all of the assets of the Company and the Guarantors, other than the Excluded Assets.

On June 10, 2004, the Company, the Guarantors, the trustee and U.S. Bank National Association, as the collateral agent for the benefit of the Holders of the notes, entered into security documents defining the terms of the security interests that secure payment and performance when due of the Senior Secured Note Obligations.

The collateral agent holds the first priority Liens on the Senior Secured Note Priority Collateral and the second priority Liens on the Credit Facility Priority Collateral granted to it pursuant to the security documents. The collateral agent is subject to such directions as may be given it by the trustee from time to time as required or permitted by the indenture. Except as directed by the trustee and as required or permitted by the indenture, the collateral agent is not be obligated to:


	(1) act upon directions purported to be delivered to it by any other Person;

	(2) foreclose upon or otherwise enforce any Lien; or

	(3) take any other action whatsoever with regard to any or all of the Liens, security documents or the Collateral.

The collateral agent is authorized and empowered to receive for the benefit of the Holders of the Senior Secured Note Obligations any funds collected or distributed under the security documents and to make further distributions of such funds to the Holders of the Senior Secured Note Obligations according to the indenture.

The security documents provide that, in enforcing (and in directing the collateral agent to enforce) the Senior Secured Note Liens, the trustee is subject to such instructions as may be given to it by the Holders of a majority in outstanding principal amount of the notes.

Subject to the provisions of the indenture governing the trustee’s duties and rights generally, and subject to the provisions described below under the caption “— Intercreditor Agreement,” the trustee may, in its sole discretion and without the consent of the Holders of the Senior Secured Note Obligations, direct, on behalf of the Holders of the Senior Secured Note Obligations, the collateral agent to take all actions it deems necessary or appropriate in order to:


	(1) foreclose upon or otherwise enforce any or all of the Senior Secured Note Liens;

	(2) enforce any of the terms of the security documents; or

	(3) collect and receive payment of any and all of the Senior Secured Note Obligations.

The security documents provide that the collateral agent’s Liens upon the Collateral will be released:


	(1) in whole, upon payment in full of the notes and all other Senior Secured Note Obligations that are outstanding, due and payable at the time the notes are paid in full;

	(2) upon satisfaction and discharge of the indenture as set forth under the caption “— Satisfaction and Discharge”;

	(3) upon a Legal Defeasance or Covenant Defeasance as set forth under the caption “— Legal Defeasance and Covenant Defeasance”;

	(4) as to any Collateral that constitutes all or substantially all of the Collateral, with the consent of the Holders of 66 2/3% in principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, the notes);

	(5) as to any Collateral that constitutes less than all or substantially all of the Collateral, with the consent of the Holders of a majority in principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, the notes);

	(6) as to any Collateral that is sold, transferred or otherwise disposed of by the Company or any other Obligor to a Person that is not (either immediately before or after such sale, transfer or disposition) the Company or a Restricted Subsidiary of the Company in a transaction or other circumstance that is not prohibited by the “Asset Sale” provisions of the indenture and is not prohibited by all of the other Senior Secured Note Documents, at the time of such sale, transfer or other disposition or to the extent of the interest sold, transferred or otherwise disposed of; provided that the collateral agent’s Liens upon the Collateral will not be released if the sale or disposition is prohibited by the covenant described below under the caption “— Certain Covenants — Merger, Consolidation or Sale of Assets”;

	(7) as to any Collateral owned by any Guarantor all of the Capital Stock of which is being sold, transferred or otherwise being disposed of, directly or indirectly, to a Person that is not (either immediately before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company in a transaction that does not violate the “Asset Sales” provisions of the indenture, at the time of such sale, transfer or other disposition;

	(8) as to any Collateral owned by any Restricted Subsidiary that is a Guarantor, upon (a) the designation of such Restricted Subsidiary as an Unrestricted Subsidiary in accordance with the applicable provisions of the indenture or (b) if such Restricted Subsidiary is not a Domestic Restricted Subsidiary, when it ceases to be a guarantor or otherwise provide direct credit support for any other Indebtedness of the Company or any Guarantor;


	(9) as to any Credit Facility Priority Collateral, in the event of any private or public sale of all or any portion of such Credit Facility Priority Collateral in connection with any Exercise of Remedies by or with the consent of the Credit Facility Agent at any time prior to the date upon which the Discharge of Credit Facility Obligations shall have occurred (and irrespective of whether an Event of Default has occurred), so long as the net cash proceeds of any such sale are applied as set forth under the caption “— Intercreditor Agreement — Application of Proceeds of Collateral”;

	(10) as to Excluded Securities, in accordance with the conditions set forth in the definition of Excluded Assets; and

	(11) as to any Credit Facility Priority Collateral, upon delivery of certification to the trustee and the collateral agent by a Credit Facility Agent to the effect that such Credit Facility Priority Collateral has been released by the requisite number of holders of the Credit Facility Obligations in accordance with the terms of the Credit Facility Documents; provided that at the time of such release, the aggregate principal amount of Credit Facility Debt outstanding (including outstanding letters of credit, whether or not then available or drawn) and the aggregate unfunded commitments to extend credit that, when funded, would constitute Credit Facility Debt must exceed $25 million.

The security documents will provide that the Senior Secured Note Liens will extend to the proceeds of any sale of Collateral. As a result, the collateral agent’s Liens will apply to the proceeds of any such Collateral received in connection with any sale or other disposition of assets described in the immediately preceding paragraph.

The indenture provides that the Company will comply with the provisions of TIA §314.

To the extent applicable, the Company will cause TIA § 313(b), relating to reports, and TIA § 314(d), relating to the release of property or securities or relating to the substitution therefor of any property or securities to be subjected to the Senior Secured Note Liens of the security documents, to be complied with. Any certificate or opinion required by TIA § 314(d) may be made by an officer of the Company except in cases where TIA § 314(d) requires that such certificate or opinion be made by an independent Person, which Person will be an independent engineer, appraiser or other expert selected or reasonably satisfactory to the trustee. Notwithstanding anything to the contrary in this paragraph, the Company will not be required to comply with all or any portion of TIA § 314(d) if it determines, in good faith based on advice of counsel, that under the terms of TIA § 314(d) and/or any interpretation or guidance as to the meaning thereof of the SEC and its staff, including “no action” letters or exemptive orders, all or any portion of TIA § 314(d) is inapplicable to one or a series of released Collateral.

The indenture and the other security documents provide that the Company and each of the Guarantors will do or cause to be done all acts and things that the collateral agent from time to time may reasonably request to assure and confirm that the collateral agent holds, for the benefit of the holders of Senior Secured Note Obligations, duly created and enforceable and perfected Liens upon the Collateral, including any property or assets that are acquired or otherwise become Collateral after the notes are issued, subject to Permitted Prior Liens in the case of Senior Secured Note Priority Collateral, and to Credit Facility Liens and other Liens, if any, permitted by the applicable Qualified Credit Facility to be prior to the Credit Facility Liens in the case of Credit Facility Priority Collateral, in each case, as contemplated by the Senior Secured Note Documents.

Upon the reasonable request of the collateral agent or the trustee at any time and from time to time, the Company and each of the Guarantors will promptly execute, acknowledge and deliver such security documents, instruments, certificates, notices and other documents, and take such other actions as the collateral agent may reasonably request, to create, perfect, protect, assure or enforce the Liens and benefits


	(1) keep their properties adequately insured at all times by responsible and reputable insurers, which, in the case of any insurance on any mortgaged property, are licensed to do business in the States, provinces or other jurisdictions where the applicable mortgaged property is located;

	(2) maintain such other insurance, to such extent and against such risks (and with such deductibles, retentions and exclusions), including fire and other risks insured against by extended coverage and coverage for acts of terrorism, as is customary with companies in the same or similar businesses operating in the same or similar locations, including public liability insurance against claims for personal injury or death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled by them;

	(3) provide title insurance on all real property Collateral insuring the collateral agent’s Lien on that property, subject only to Permitted Prior Liens and other exceptions to title approved by the collateral agent;

	(4) maintain such other insurance as may be required by law; and

	(5) maintain such other insurance as may be required by the security documents.

The Company and the Guarantors may maintain self-insurance in connection with the above insurance requirements (other than clause (3)) to the extent reasonably prudent and consistent with past practices. Upon the request of the collateral agent, the Company and the Guarantors will furnish to the collateral agent all information reasonably requested by the collateral agent as to their property and liability insurance carriers.

On June 10, 2004, the trustee and the collateral agent, on behalf of the Holders of Senior Secured Note Obligations, and the Credit Facility Agent for the ABL Facility, on behalf of the holders of Credit Facility Obligations, entered into an intercreditor agreement that sets forth the relative priority of the Senior Secured Note Priority Liens and the Credit Facility Priority Liens, as well as certain other rights, priorities and interests of the Holders of the Senior Secured Note Obligations and the holders of the Credit Facility Obligations. The trustee and the collateral agent, on behalf of the Holders of Senior Secured Note Obligations, and each Credit Facility Agent for any future applicable Credit Facility will enter into a substantially similar intercreditor agreement.

The intercreditor agreement provides that (1) the Senior Secured Note Liens are, with respect to the Credit Facility Priority Collateral, junior and subordinate to all Credit Facility Liens and, with respect to the Senior Secured Note Priority Collateral, senior and prior to all Credit Facility Liens and (2) the Credit Facility Liens are, with respect to the Senior Secured Note Priority Collateral, junior and subordinate to all Senior Secured Note Liens and, with respect to Credit Facility Priority Collateral, senior and prior to all Senior Secured Note Liens, notwithstanding, among other thing, the manner or order in which such Liens are granted or the failure to perfect any such Liens. In addition, Holders of Senior Secured Note Obligations and holders of Credit Facility Obligations may not contest or challenge (or assist or support any other person in contesting or challenging), directly or indirectly, including in any insolvency or liquidation proceeding, the validity, priority, enforceability or perfection of the Credit Facility Liens and the Senior Secured Note Liens, respectively. Holders of Senior Secured Note Obligations may not interfere in the Exercise of Remedies or actions taken to enforce the Credit Facility Liens on the Credit Facility Priority Collateral, and holders of Credit Facility Obligations may not interfere in the Exercise of Remedies or actions taken to enforce the Senior Secured Note Liens on the Senior Secured Note Priority Collateral.

The Credit Facility Agent and the holders of Credit Facility Obligations have the right of access, during normal business hours on any business day, to Credit Facility Priority Collateral that is located in, become an accession to, or commingled with Senior Secured Note Priority Collateral, regardless of whether the trustee,

Holders of Senior Secured Note Obligations will not exercise any remedies or take any other actions to enforce or realize upon any Senior Secured Note Liens on the Credit Facility Priority Collateral and will not take, receive or accept any proceeds of Credit Facility Priority Collateral at any time when any Credit Facility Obligations are outstanding, and holders of Credit Facility Obligations will not exercise any remedies or take any other actions to enforce or realize upon any Credit Facility Liens on Senior Secured Note Priority Collateral and will not take, receive or accept any proceeds of Senior Secured Note Priority Collateral at any time when any Senior Secured Note Obligations are outstanding; provided that the temporary deposit of proceeds of Credit Facility Priority Collateral in a deposit account controlled by the collateral agent or the proceeds of Senior Secured Note Priority Collateral in a deposit account controlled by any Credit Facility Agent will not violate the intercreditor agreement so long as those proceeds are promptly remitted to the Credit Facility Agent, in the case of proceeds from Credit Facility Priority Collateral, or the collateral agent, in the case of proceeds from Senior Secured Note Priority Collateral.

In the case of Credit Facility Priority Collateral and all proceeds thereof received in connection with any Exercise of Remedies by the holders of Credit Facility Obligations or Senior Secured Note Obligations, amounts will be applied: (1) first, to the payment of costs and expenses of the Credit Facility Agent or the collateral agent, as applicable, in connection with such Exercise of Remedies, (2) second, to the payment of the Credit Facility Obligations until the Discharge of Credit Facility Obligations, (3) third, to the payment of Senior Secured Note Obligations until the Discharge of Senior Secured Note Obligations and (4) fourth, to the Company or otherwise as directed by a court of competent jurisdiction.

In the case of Senior Secured Note Priority Collateral and all proceeds thereof received in connection with any Exercise of Remedies by the holders of Credit Facility Obligations or Senior Secured Note Obligations, amounts will be applied: (1) first, to the payment of costs and expenses of the Credit Facility Agent or the collateral agent, as applicable, in connection with such Exercise of Remedies, (2) second, to the payment of the Senior Secured Note Obligations until the Discharge of Senior Secured Note Obligations, (3) third,to the payment of Credit Facility Obligations until the Discharge of Credit Facility Obligations and (4) fourth, to the Company or otherwise as directed by a court of competent jurisdiction.

If the Company or any Guarantor is subject to any insolvency or liquidation proceeding in the United States at any time prior to the Discharge of Credit Facility Obligations, and the Credit Facility Agent or the lenders under the applicable Qualified Credit Facility seek to provide the Company or any Guarantor with, or consent to a third party providing, any financing under Section 364 of the Bankruptcy Code or consent to any order for the use of cash collateral under Section 363 of the Bankruptcy Code (a “DIP Financing”), with such DIP Financing to be secured by all or any portion of the Collateral (including assets that, but for the application of Section 552 of the Bankruptcy Code would be Collateral), then the trustee, the collateral agent and the Holders of the Senior Secured Note Obligations may raise no objection and may not support any objection to such DIP Financing on the grounds of a failure to provide “adequate protection” for the Senior Secured Note Liens or on any other grounds (and will not request any adequate protection solely as a result of such DIP Financing), so long as (1) the collateral agent retains the Senior Secured Note Liens on the Collateral (in each case, including proceeds thereof arising after the commencement of the case under the Bankruptcy Code) and, as to the Senior Secured Note Priority Collateral only, such Senior Secured Note Liens have the same priority as existed prior to the commencement of the case under the Bankruptcy Code and any Liens securing such DIP Financing are junior and subordinate to the Senior Secured Note Liens on the Senior Secured Note Priority Collateral, (2) all Liens on Credit Facility Priority Collateral securing any such DIP Financing shall be senior to or on a parity with the Credit Facility Liens on Credit Facility Priority Collateral and (3) if the Credit Facility Agent receives an adequate protection Lien on post-petition assets of the debtor to secure the Credit Facility Obligations, the collateral agent also receives an

All Liens granted to the Credit Facility Agent or the collateral agent in any insolvency or liquidation proceeding, whether as adequate protection or otherwise, will be subject to the Lien priority and other terms set forth in the intercreditor agreement.

Until the Discharge of Credit Facility Obligations has occurred, the trustee, the collateral agent and all Holders of Senior Secured Note Obligations may not seek relief from the automatic stay or any other stay in any insolvency or liquidation proceeding in respect of any portion of the Credit Facility Priority Collateral without the Credit Facility Agent’s express written consent. Until the Discharge of Senior Secured Note Obligations has occurred, the Credit Facility Agent and all holders of Credit Facility Obligations may not seek relief from the automatic stay or any other stay in any insolvency or liquidation proceeding in respect of any portion of the Senior Secured Note Priority Collateral without the trustee’s express written consent. In addition, neither the trustee or collateral agent nor the Credit Facility Agent may seek any relief from the automatic stay with respect to any Collateral without providing 30 days’ prior written notice to the other, unless such period is agreed by both the Credit Facility Agent and the trustee and collateral agent to be modified.

Prior to the Discharge of Credit Facility Obligations, the trustee, the collateral agent and Holders of Senior Secured Note Obligations may not contest (or support any other Person contesting) (1) any request by the Credit Facility Agent or any holder of Credit Facility Obligations for adequate protection of its interest in the Collateral, or (2) any objection by the Credit Facility Agent or any holder of Credit Facility Obligations to any motion, relief, action, or proceeding based on a claim by the Credit Facility Agent or any holder of Credit Facility Obligations that its interests in the Collateral are not adequately protected (or any other similar request under any law applicable to an insolvency or liquidation proceeding), so long as any Liens granted to the Credit Facility Agent or holder of Credit Facility Obligations as adequate protection of its interests are subject to the intercreditor agreement.

Prior to the Discharge of Senior Secured Note Obligations, the Credit Facility Agent and holders of Credit Facility Obligations may not contest (or support any other Person contesting) (1) any request by the trustee, the collateral agent or any holder of Senior Secured Note Obligations for adequate protection of its interest in the Collateral (unless in contravention of the provisions relating to a DIP Financing described above), or (2) any objection by the trustee, the collateral agent or any Holder of Senior Secured Note Obligations to any motion, relief, action, or proceeding based on a claim by the trustee, the collateral agent or any Holder of Senior Secured Note Obligations that its interests in the Collateral (unless in contravention of the provisions relating to a DIP Financing described above) are not adequately protected (or any other similar request under any law applicable to an insolvency or liquidation proceeding), so long as any Liens granted to the trustee, collateral agent or Holder of Senior Secured Note Obligations as adequate protection of its interests are subject to the intercreditor agreement.

The trustee, the collateral agent and the Holders of Senior Secured Note Obligations may not oppose any sale consented to by the Credit Facility Agent of any Credit Facility Priority Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any insolvency or liquidation proceeding) so long as the proceeds of such sale are applied as set forth above under the caption “— Intercreditor Agreement — Application of Proceeds of Collateral.” The Credit Facility Agent and the holders of Credit Facility Obligations may not oppose any sale consented to by the trustee and collateral agent of any Senior Secured Note Priority Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any insolvency or liquidation proceeding) so long as the proceeds of such sale are applied as set forth above under the caption “— Intercreditor Agreement — Application of Proceeds of Collateral.” If such sale of Collateral includes both Credit Facility Priority Collateral and Senior Secured Note Priority Collateral, and the Credit Facility Agent and the trustee and collateral agent are unable to agree on the allocation of the purchase price between the Credit Facility Priority Collateral and Senior

The provisions described above under the caption “— Intercreditor Agreement” set forth certain relative rights, as lienholders, between the trustee and the Holders of the Senior Secured Note Obligations and each Credit Facility Agent and the holders of the Credit Facility Obligations. Nothing in the intercreditor agreement will:


	(1) impair, as between the Company, any other Obligor and Holders of Senior Secured Note Obligations, the obligation of the Company, which is absolute and unconditional, to pay principal of, premium and interest and Liquidated Damages, if any, on the notes in accordance with their terms or to perform any other obligation of the Company or any other Obligor under the Senior Secured Note Documents;

	(2) impair, as between the Company, any other obligor under a Qualified Credit Facility and holders of the loans under a Qualified Credit Facility, the obligation of the Company, which is absolute and unconditional, to pay principal of, premium and interest, on such loans in accordance with their terms or to perform any other obligation of the Company or any other obligor under a Qualified Credit Facility;

	(3) affect the relative rights of holders of Senior Secured Note Obligations or Credit Facility Obligations, on the one hand, and other creditors of the Company or any of its Subsidiaries, on the other hand;

	(4) restrict the right of any holder of Senior Secured Note Obligations or Credit Facility Obligations to sue for payments that are then due and owing;

	(5) prevent the collateral agent, the trustee or a Credit Facility Agent or any holder of Senior Secured Note Obligations or Credit Facility Obligations from exercising against the Company or any other Obligor any of its other available remedies upon a default or event of default, subject to the provisions described under the caption “— Intercreditor Agreement”; or

	(6) restrict the right of the collateral agent, the trustee, a Credit Facility Agent or any holder of Senior Secured Note Obligations or Credit Facility Obligations to file and prosecute a petition seeking an order for relief in an involuntary bankruptcy case as to any Obligor or otherwise to commence, or seek relief commencing, any insolvency or liquidation proceeding involuntarily against any Obligor or to assert or enforce any claim, Lien, right or remedy in any voluntary or involuntary bankruptcy case or insolvency or liquidation proceeding, subject to the provisions described under the caption “— Intercreditor Agreement.”

If the Company or any Restricted Subsidiary fails because of the provisions described under the caption “— Intercreditor Agreement” to perform any obligation binding upon it under any Senior Secured Note Document and such failure to perform is a Default or Event of Default under the Senior Secured Note Documents, the failure shall still be a Default or Event of Default, as the case may be.

At any time on or prior to May 15, 2007, the Company may at its option on any one or more occasions redeem up to 35% of the aggregate principal amount of notes issued under the indenture at a redemption price of 111.5% of the principal amount, plus accrued and unpaid interest and Liquidated Damages, if any, to the redemption date, with the net cash proceeds of one or more Qualified Equity Issuances; provided that:


	(1) at least 65% of the aggregate principal amount of notes initially issued under the indenture remains outstanding immediately after the occurrence of such redemption (excluding notes held by the Company and its Subsidiaries); and


	(2) the redemption occurs within 90 days of the date of the closing of such Qualified Equity Issuances.

The Company may also at its option on any one or more occasions redeem all or part of the notes upon not less than 30 nor more than 60 days prior notice, at a redemption price equal to 100% of the principal amount thereof plus the Applicable Premium as of the date of redemption (the “Make-Whole Redemption Date”). Notices of redemption may be conditional.

If less than all of the notes are to be redeemed at any time, the trustee will select notes for redemption as follows:


	(1) if the notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which the notes are listed; or

	(2) if the notes are not listed on any national securities exchange, on a pro rata basis, by lot or by such method as the trustee deems fair and appropriate.

No notes of $1,000 or less can be redeemed in part. Notices of redemption will be mailed by first class mail at least 30 but not more than 60 days before the redemption date to each Holder of notes to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the notes or a satisfaction and discharge of the indenture. Notices of redemption may not be conditional.

If any note is to be redeemed in part only, the notice of redemption that relates to that note will state the portion of the principal amount of that note that is to be redeemed. A new note in principal amount equal to the unredeemed portion of the original note will be issued in the name of the Holder of notes upon cancellation of the original note. Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on notes or portions of them called for redemption.

The Company is not required to make mandatory redemption or sinking fund payments with respect to the notes. However, under certain circumstances, the Company may be required to offer to purchase notes as described under the captions “— Repurchase of Notes at the Option of Holders — Change of Control” and “— Asset Sales.” The Company may at any time and from time to time purchase notes in the open market or otherwise.

If a Change of Control occurs, each Holder of notes will have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of that Holder’s notes validly tendered pursuant to the offer described below (the “Change of Control Offer”). The offer price in any Change of Control Offer will be payable in cash and will be equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid cash interest and Liquidated Damages, if any, on the notes repurchased, to the date of purchase (the “Change of Control Payment”). Within 30 days following any Change of Control, the Company will mail a notice to each Holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase notes on the Change of Control Payment Date (the “Change of Control Payment Date”) specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed, pursuant to the procedures required by the indenture and described in such notice. The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the notes as a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the provisions of the indenture relating to the


	(1) accept for payment all notes or portions of notes properly tendered pursuant to the Change of Control Offer;

	(2) deposit with the paying agent an amount equal to the Change of Control Payment in respect of all notes or portions of notes properly tendered; and

	(3) deliver or cause to be delivered to the trustee the notes properly accepted together with an officers’ certificate stating the aggregate principal amount of notes or portions of notes being purchased by the Company.

The paying agent will promptly mail to each Holder of notes properly tendered the Change of Control Payment for such notes, and the trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new note equal in principal amount to any unpurchased portion of the notes surrendered, if any; provided that each new note will be in a principal amount of $1,000 or an integral multiple of $1,000.

The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

The provisions described above that require the Company to make a Change of Control Offer following a Change of Control will be applicable whether or not any other provisions of the indenture are applicable. Except as described above with respect to a Change of Control, the indenture does not contain provisions that permit the Holders of the notes to require that the Company repurchase or redeem the notes in the event of a takeover, recapitalization or similar transaction.

The Company will not be required to make a Change of Control Offer upon a Change of Control if (a) the Company shall have mailed a notice of redemption for the entire principal amount of notes outstanding on or prior to such Change of Control or (b) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the indenture applicable to a Change of Control Offer made by the Company and purchases all notes properly tendered and not withdrawn under the Change of Control Offer.

The Change of Control purchase feature of the notes may in certain circumstances make more difficult or discourage a sale or takeover of the Company and, thus, the removal of incumbent management. The Change of Control purchase feature is a result of negotiations between the Company and the initial purchasers. We have no present intention to engage in a transaction involving a Change of Control, although it is possible that we could decide to do so in the future. Subject to the limitations discussed below, we could, in the future, enter into certain transactions, including acquisitions, refinancings or other recapitalizations, that would not constitute a Change of Control under the indenture, but that could increase the amount of Indebtedness outstanding at such time or otherwise affect our capital structure or credit ratings. Restrictions on the Company’s ability to incur additional Indebtedness are contained in the covenants described under “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock.” Such restrictions can only be waived with the consent of the Holders of a majority in principal amount of the notes then outstanding. Except for the limitations contained in such covenants, however, the indenture will not contain any covenants or provisions that may afford Holders of the notes protection in the event of a highly leveraged transaction.

The definition of Change of Control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of “all or substantially all” of the properties or assets of the Company and its Restricted Subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase “substantially all,” there is no precise established definition of the phrase under applicable law. Accordingly, the ability of a Holder of notes to require the Company to repurchase its notes as a result of a sale, lease,

The provisions under the indenture relating to the Company’s obligation to make an offer to repurchase the notes as a result of a Change of Control may be waived or modified with the written consent of the Holders of a majority in principal amount of the notes then outstanding.

The Company will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale (including a Sale of Senior Secured Note Priority Collateral) unless:


	(1) the Company (or the 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) if such Asset Sale, in any single transaction or series of related transactions, involves assets having a fair market value of greater than $15.0 million, such fair market value is determined by the Company’s Board of Directors and evidenced by a resolution of the Board of Directors set forth in an officers’ certificate delivered to the trustee;

	(3) in the case of a Sale of Senior Secured Note Priority Collateral, the collateral agent is promptly granted a perfected first priority security interest (subject to Permitted Prior Liens) in the Net Collateral Proceeds therefor received by the Company or the Restricted Subsidiary as additional Senior Secured Note Priority Collateral under the security documents to secure the Senior Secured Note Obligations, and, in the case of cash or Cash Equivalents constituting Net Collateral Proceeds, such Net Collateral Proceeds must be deposited into a segregated account under the sole control of the collateral agent that includes only proceeds from the Sale of Senior Secured Note Priority Collateral and interest earned thereon (an “Asset Sale Proceeds Account”) and is free from all other Liens (other than Permitted Prior Liens), all on terms and pursuant to arrangements reasonably satisfactory to the collateral agent in its reasonable determination (which may include, at the collateral agent’s reasonable request, customary officers’ certificates and legal opinions and shall include release provisions requiring the collateral agent to release deposits in the Asset Sale Proceeds Account as necessary to permit the Company or its Restricted Subsidiaries to apply such Net Collateral Proceeds in the manner described below, unless the collateral agent has received written notice that an Event of Default has occurred and is continuing); and

	(4) at least 75% of the consideration received in the Asset Sale by the Company or such Restricted Subsidiary is in the form of cash and Cash Equivalents. For purposes of this provision, each of the following will be deemed to be cash:


	(a) any liabilities, as shown on the Company’s most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the notes or any Guarantee) that are assumed by the transferee of any such assets pursuant to a customary agreement that releases the Company or such Restricted Subsidiary from further liability; and

	(b) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary within 45 days of receipt into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents received in that conversion.

Within 365 days after the receipt of any Net Proceeds from an Asset Sale, other than a Sale of Senior Secured Note Priority Collateral, the Company may apply such Net Proceeds to:


	(1) repay Indebtedness and other Obligations under a Credit Facility and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto;


	(2) acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated within 180 days after the end of such 365-day period) all or substantially all of the assets of, or a majority of the Voting Stock of, a Permitted Business or the minority interest in any Restricted Subsidiary;

	(3) make a capital expenditure;

	(4) acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated within 180 days after the end of such 365-day period) other long-term assets that are used or useful in a Permitted Business; or

	(5) make an offer to all Holders of notes to purchase notes at a purchase price equal to 100% of the principal amount of the notes to be purchased plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, payable in cash.

Pending the final application of any Net Proceeds from Asset Sales, other than a Sale of Senior Secured Note Priority Collateral, the Company may temporarily reduce revolving credit borrowings or otherwise invest such Net Proceeds in any manner that is not prohibited by the indenture.

Any Net Proceeds from Asset Sales, other than a Sale of Senior Secured Note Priority Collateral, that are not applied or invested as provided in the preceding paragraph will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company will make an Asset Sale Offer to all Holders of notes with the proceeds of sales of assets to purchase the maximum amount of notes that may be purchased out of the Excess Proceeds.

The offer price in any Asset Sale Offer will be equal to 100% of the principal amount of the notes to be purchased plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company may use those Excess Proceeds for any purpose not otherwise prohibited by the indenture. If the aggregate principal amount of notes tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the trustee will select the notes 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.

Within 365 days after the receipt of any Net Collateral Proceeds from a Sale of Senior Secured Note Priority Collateral, the Company or the Restricted Subsidiary, as the case may be, may apply such Net Collateral Proceeds (other any noncash consideration representing Permitted Assets received by the Company in respect of any Sale of Senior Secured Note Priority Collateral; provided that the collateral agent shall promptly be granted a perfected first priority security interest (subject to Permitted Prior Liens) on all such assets as Senior Secured Note Priority Collateral under the security documents to secure the notes on terms and pursuant to arrangements reasonably satisfactory to the collateral agent in its reasonable determination (which may include, at the collateral agent’s reasonable request, customary officers’ certificates and legal opinions)) at its option:


	(1) to acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and shall be consummated within 180 days after the end of such 365-day period) all or substantially all of the assets of, or a majority of the Voting Stock of, a Permitted Business principally owning Permitted Assets that have (in the good faith judgment of the Company) a value, net of the value of any Credit Facility Priority Collateral included therein, at least equal to the amount of such Net Collateral Proceeds; or

	(2) to make capital expenditures on or acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and shall be consummated within 180 days after the end of such 365-day period) Permitted Assets;

provided, that in each such case, the collateral agent shall immediately be granted a perfected first priority security interest (subject to Permitted Prior Liens) on all of the assets (other than any Credit Facility Priority Collateral included therein) acquired with such Net Collateral Proceeds as Senior Secured Note Priority

Any Net Collateral Proceeds from any Sale of Senior Secured Note Priority Collateral that are not applied or invested as provided in the preceding paragraph will constitute “Excess Collateral Proceeds.” When the aggregate amount of Excess Collateral Proceeds exceeds $10.0 million, the Company will make an offer to all Holders of notes (a “Collateral Proceeds Offer”) with the proceeds of sales of assets to purchase the maximum principal amount of notes that may be purchased out of the Excess Collateral Proceeds. The offer price in any Collateral Proceeds Offer will be equal to 100% of principal amount plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, and will be payable in cash. If any Excess Collateral Proceeds remain after consummation of a Collateral Proceeds Offer, the Company and its Restricted Subsidiaries may use any remaining Excess Collateral Proceeds, free and clear of any Liens created by any security documents or otherwise for the benefit of any holder of Senior Secured Note Obligations, for any other purpose not otherwise prohibited by the indenture. If the aggregate principal amount of notes tendered into such Collateral Proceeds Offer exceeds the amount of Excess Collateral Proceeds, the trustee will select the notes to be purchased on a pro rata basis. Upon completion of each Collateral Proceeds Offer, the amount of Excess Collateral Proceeds will be reset at zero.

The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of the indenture, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Sale provisions of the indenture by virtue of such conflict.

The agreements governing the Company’s other Indebtedness contain prohibitions of certain events, including events that would constitute a Change of Control or an Asset Sale. In addition, the exercise by the Holders of notes of their right to require the Company to repurchase the notes upon a Change of Control or an Asset Sale could cause a default under these other agreements, even if the Change of Control or Asset Sale itself does not, due to the financial effect of such repurchases on the Company. The Company’s ability to pay cash to the Holders of notes upon a repurchase may also be limited by the Company’s then-existing financial resources. See “Risk Factors — Risks Relating to Our Liquidity, the Notes and Our Other Indebtedness — If there is a change of control, we may not have the ability to raise the funds necessary to permit us to consummate the change of control offer required by the indenture governing the exchange notes.”

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


	(1) declare or pay any dividend or make any other payment or distribution on account of the Company’s or any of its Restricted Subsidiaries’ Equity Interests (including, without limitation, any payment in connection with any merger, amalgamation or consolidation involving the Company or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Company’s or any of its Restricted Subsidiaries’ Equity Interests in their capacity as such (other than dividends or distributions payable (a) in Equity Interests (other than Disqualified Stock) of the Company or (b) to the Company or a Restricted Subsidiary of the Company);

	(2) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger, amalgamation or consolidation involving the Company) any Equity Interests of the Company (other than any such Equity Interests owned by the Company or any Guarantor);

	(3) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness of the Company or any Guarantor that is contractually subordinated to the notes or to any Guarantee thereof (excluding any intercompany Indebtedness between or among the


	Company and any of its Restricted Subsidiaries) except a payment of interest or principal at or within one year of the Stated Maturity thereof; or

	(4) make any Restricted Investment (all such payments and other actions set forth in these clauses (1) through (4) above being collectively referred to as “Restricted Payments”),


	(a) no Default has occurred and is continuing or would occur as a consequence of such Restricted Payment; and

	(b) the Company would, at the time of such Restricted Payment, after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described below under the caption “— Incurrence of Indebtedness and Issuance of Preferred Stock;” and

	(c) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the date of the indenture (excluding Restricted Payments permitted by clauses (2), (3), (4), (6), (7), (8), (9) and (10) of the next succeeding paragraph), is less than the sum, without duplication, of:


	(i) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from the beginning of the first fiscal quarter commencing after the date of the indenture to the end of the Company’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit), plus

	(ii) 100% of the aggregate net cash proceeds received by the Company since the date of the indenture as a contribution to its common equity capital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock) or from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of the Company that have been converted into or exchanged for such Equity Interests (other than Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary of the Company), plus

	(iii) the amount by which Indebtedness of the Company is reduced on the Company’s balance sheet upon the conversion or exchange (other than (A) the exchange of Series B Notes for Series B Preferred Stock or (B) a conversion or exchange by a Subsidiary of the Company) subsequent to the date of the indenture of any Indebtedness of the Company convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Company (less the amount of any cash, or the fair value of any other property, distributed by the Company upon such conversion or exchange), plus

	(iv) to the extent that any Restricted Investment that was made after the date of the indenture is sold for cash or otherwise liquidated, repaid, repurchased or redeemed for cash, the lesser of (A) the cash return of capital with respect to such Restricted Investment (less the cost of disposition, if any) and (B) the initial amount of such Restricted Investment, plus

	(v) to the extent that any Unrestricted Subsidiary of the Company is redesignated as a Restricted Subsidiary after the date of the Indenture, the lesser of (A) the fair market value of the Company’s investment in such Subsidiary as of the date of such redesignation and (B) such fair market value as of the date on which such subsidiary was originally designated as an Unrestricted Subsidiary.


	(1) the payment of any dividend or similar distribution or the consummation of any redemption within 60 days after the date of declaration of the dividend or distribution or the giving of the redemption notice, as the case may be, if at the date of declaration or notice, the dividend, distribution, redemption or payment would have complied with the provisions of the indenture;


	(2) any Restricted Payment made in exchange for, or made out of the net cash proceeds of the substantially concurrent sale (other than to a Restricted Subsidiary of the Company) of, Equity Interests of the Company (other than Disqualified Stock) or from the substantially concurrent contribution of common equity capital to the Company; provided that the amount of any such Restricted Payment made will be excluded from clause (c)(ii) of the preceding paragraph;

	(3) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness of the Company or any Guarantor in exchange for, or out of the net cash proceeds from an incurrence of, Permitted Refinancing Indebtedness;

	(4) the payment of any dividend or other similar distribution by a Restricted Subsidiary of the Company to the holders of its Equity Interests on a pro rata basis;

	(5) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company or any Restricted Subsidiary of the Company (a) held by any employee or director of the Company (or any of its Restricted Subsidiaries) or (b) in connection with, or to provide the Equity Interests for, delivery of Equity Interests to grantees under any stock incentive plan of the Company or any of its Restricted Subsidiaries; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests may not exceed $1.0 million in any fiscal year, provided further, however, that amounts available pursuant to this clause (5) to be utilized for Restricted Payments during any such fiscal year that are not so utilized may be carried forward and utilized in any succeeding fiscal year;

	(6) the purchase by the Company of fractional shares arising out of stock dividends, splits, conversions or combinations or business combinations;

	(7) the exchange of Milacron’s common stock into which the Series A Notes have been converted and of the Series B Notes for Series B Preferred Stock in accordance with the Note Purchase Agreement;

	(8) the payment of any dividends on the Existing Preferred Stock in accordance with its terms not to exceed $300,000 in any 12-month period beginning with the 12-month period commencing on the date of the indenture;

	(9) the redemption of shares of Series B Preferred Stock with the proceeds of a Rights Offering in accordance with the terms of the Series B Preferred Stock; and

	(10) so long as no Default has occurred and is continuing or would be caused thereby, Restricted Payments in an aggregate amount which, when added together with the amount of all other Restricted Payments made under this clause (10), does not exceed $10.0 million.

The amount of all Restricted Payments (other than cash) will be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or such Restricted 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 covenant will be determined by the Board of Directors of the Company whose resolution shall be conclusive with respect thereto will be delivered to the trustee.

The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt), and the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stock, in each case if the Fixed Charge Coverage Ratio for the Company’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma

The first paragraph of this covenant will not prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):


	(1) the incurrence by the Company and any of the Guarantors of additional Indebtedness and letters of credit under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder), not to exceed the greater of (x) $75.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries since the date of the indenture to repay any term Indebtedness under a Credit Facility or to repay any revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales” and less the amount of any Indebtedness of a Domestic Receivables Subsidiary outstanding under clause (15) below and (y) the Domestic Borrowing Base;

	(2) the incurrence by the Foreign Restricted Subsidiaries of additional Indebtedness and letters of credit under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (2) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Foreign Restricted Subsidiaries thereunder) not to exceed the greater of (x) $40.0 million less Indebtedness of Foreign Restricted Subsidiaries existing at the time of such incurrence less the aggregate amount of all Net Proceeds of Asset Sales applied by the Foreign Restricted Subsidiaries since the date of the indenture to repay any term Indebtedness under a Credit Facility or to repay any revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales” and less the amount of any Indebtedness of a Foreign Receivables Subsidiary outstanding under clause (15) below and (y) the Foreign Borrowing Base;

	(3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;

	(4) the incurrence by the Company and the Guarantors of Indebtedness represented by the notes to be issued on the date of the indenture, the related Guarantees to be issued after the expiration of the Escrow Period and the exchange notes and the related Guarantees to be issued pursuant to the registration rights agreement;

	(5) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (5), not to exceed $30.0 million at any time outstanding;

	(6) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by the indenture to be incurred under the first paragraph of this covenant or clauses (3), (4), (5), (6), (17) or (18) of this paragraph;


	(7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:


	(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the notes, in the case of the Company, or the Guarantee, in the case of a Guarantor;

	(b) if the obligee on such Indebtedness is the Company or a Guarantor, a perfected first priority security interest (subject to Permitted Prior Liens) is promptly granted to the trustee in such intercompany Indebtedness; and

	(c) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (7);


	(8) prior to the expiration of the Escrow Period, the incurrence by the Company and its Restricted Subsidiaries of Indebtedness under the Existing Senior Credit Facility;

	(9) prior to the expiration of the Escrow Period, the incurrence by the Company of the Series B Notes;

	(10) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations in the ordinary course of business;

	(11) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Guarantor that was permitted to be incurred by another provision of this covenant;

	(12) the incurrence of Obligations in respect of performance, bid and surety bonds and completion guarantees provided by the Company or any of its Restricted Subsidiaries in the ordinary course of business;

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

	(14) the guarantee by the Foreign Restricted Subsidiaries of Indebtedness of the Foreign Restricted Subsidiaries that was permitted to be incurred by another provision of this covenant;

	(15) the incurrence by any Receivables Subsidiary of Indebtedness pursuant to a Qualified Receivables Transaction;

	(16) the incurrence of unsecured Indebtedness in respect of customer financing programs (including lease transactions) in an aggregate principal amount at any one time outstanding under this clause (16) not to exceed $15.0 million;

	(17) the incurrence by Foreign Restricted Subsidiaries of Indebtedness in an aggregate principal amount, at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (17), not to exceed $5.0 million; and

	(18) the incurrence by the Company or any of its Restricted Subsidiaries of additional unsecured Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (18), not to exceed $25.0 million; provided that Restricted Subsidiaries that are not Guarantors may not incur Indebtedness, when taken together with any


	Indebtedness issued and outstanding under clause (17) above, in excess of $8.0 million in the aggregate pursuant to this clause (18).

To the extent the Company’s Unrestricted Subsidiaries incur Non-Recourse Indebtedness and any such Indebtedness ceases to be Non-Recourse Indebtedness, then such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was subject to this covenant.

The Company and the Guarantors will not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or any Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the notes on substantially identical terms; provided, however, that no Indebtedness of the Company or any Guarantor will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or any Guarantor solely by virtue of being unsecured or by virtue of being secured on a first or junior Lien basis.

For purposes of determining compliance with this “Incurrence of Indebtedness and Issuance of Preferred Stock” covenant, 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 (18) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company will be permitted to divide and classify such item of Indebtedness on the date of its incurrence or later reclassify all or a portion of such item of Indebtedness in any manner that complies with this covenant. Indebtedness under Credit Facilities outstanding on the date on which notes are first issued and authenticated under the indenture will be deemed to have been incurred on such date in reliance on the exception provided by clause (8) of the definition of Permitted Debt. Indebtedness under Credit Facilities outstanding on the expiration date of the Escrow Period will be deemed to have been incurred on such date in reliance on the exception provided by clause (1) or (2) of the definition of Permitted Debt, as applicable. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant; provided, in each such case, that the amount of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued.


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

	(2) the principal amount of the Indebtedness, in the case of any other Indebtedness; and

	(3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:


	(a) the fair market value of such assets at the date of determination; and

	(b) the amount of the Indebtedness of the other Person.

For purposes of determining compliance with any U.S. dollar denominated restriction on the incurrence of Indebtedness where the Indebtedness incurred is denominated in a currency other than U.S. dollars, the amount of such Indebtedness will be the U.S. Dollar Equivalent of such Indebtedness determined on the date of incurrence, provided that if any such Indebtedness denominated in a currency other than U.S. dollars is subject to a Currency Agreement with respect to U.S. dollars covering all principal, premium, if any, and interest payable on such Indebtedness, the amount of such Indebtedness expressed in U.S. dollars will be as provided in such Currency Agreement. The principal amount of any Permitted Refinancing Indebtedness incurred in the same currency as the Indebtedness being refinanced will be the U.S. Dollar Equivalent of the Indebtedness being refinanced, except to the extent that (a) such U.S. Dollar Equivalent was determined based on a Currency Agreement, in which case the Permitted Refinancing Indebtedness will be determined in accordance with the preceding sentence, and (b) the principal amount of the Permitted Refinancing Indebtedness exceeds the principal amount of the Indebtedness being refinanced, in which case the

The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind on any asset now owned or hereafter acquired, except Permitted Liens.

In addition, the Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly create, incur, assume or suffer to exist any Lien of any kind on any Credit Facility Priority Collateral securing any Credit Facility Obligation, unless the Company or such Restricted Subsidiary concurrently (1) grants a Lien of such kind, pursuant to a security document upon substantially the same terms but subject to the provisions set forth under the caption “— Intercreditor Agreement,” to the collateral agent for the benefit of the Holders of Senior Secured Note Obligations and (2) causes such Lien to be duly perfected.

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


	(1) pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or pay any indebtedness owed to the Company or any of its Restricted Subsidiaries;

	(2) make loans or advances to the Company or any of its Restricted Subsidiaries; or

	(3) transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries.

However, the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of:


	(1) agreements governing Existing Indebtedness and Credit Facilities (other than the Series B Notes and the Existing Senior Credit Facility) as in effect on the date of the indenture and the ABL Facility and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of those agreements, provided that the amendments, modifications, restatements, renewals, increases, supplements, refundings, replacement or refinancings are not materially more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreements on the date of the indenture;

	(2) any agreement governing the terms of any Indebtedness incurred pursuant to clause (2) of the covenant described under “— Incurrence of Indebtedness and Issuance of Preferred Stock,” provided that (a) either (i) the encumbrance or restriction applies only in the event of and during the continuation of a default under such agreement or (ii) the Board of Directors of the Company determines, at the time such agreement is entered into (and at the time of any modification of the terms of any such encumbrance or restriction), any such encumbrance or restriction will not materially affect the Company’s ability to make principal or interest payments on the notes and (b) the encumbrance or restriction is not materially less favorable to the Holders of the notes than is customary in comparable financings or agreements (as determined by the Board of Directors of the Company);

	(3) agreements governing the Series B Notes and the Existing Credit Facility;

	(4) the indenture, the notes and the Guarantees;

	(5) applicable law and any applicable rule, regulation or order;

	(6) any instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such


	Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired, provided that, in the case of Indebtedness, such Indebtedness was permitted by the terms of the indenture to be incurred;

	(7) customary non-assignment provisions in leases, licenses or contracts entered into in the ordinary course of business;

	(8) purchase money obligations that impose restrictions on that property of the nature described in clause (3) of the preceding paragraph;

	(9) customary restrictions in any agreement for the sale or other disposition 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 Capital Stock or assets of that Subsidiary;

	(10) Permitted Refinancing Indebtedness, provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced, as determined in good faith by the Board of Directors of the Company;

	(11) Liens securing Indebtedness that limit the right of the debtor to dispose of the assets subject to such Liens;

	(12) customary provisions in joint venture agreements, assets sale agreements, stock sale agreements and other similar agreements entered into in the ordinary course of business;

	(13) agreements governing Indebtedness of Foreign Restricted Subsidiaries under Foreign Credit Facilities; provided that such encumbrances or restrictions are customary and market for similarly situated borrowers under similar kinds of agreements for working capital Indebtedness at the time of entering into such Foreign Credit Facilities;

	(14) Indebtedness or other contractual requirements of a Receivables Subsidiary in connection with a Qualified Receivables Transaction; provided that such restrictions apply only to such Receivables Subsidiary; and

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

The Company may not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not the Company 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 Company and its Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person; unless:


	(1) either: (a) the Company is the surviving corporation; or (b) the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, conveyance or other disposition has been made is a Person organized or existing under the laws of the United States, any state of the United States or the District of Columbia (any such Person, the “Successor Company”);

	(2) the Successor Company assumes all the obligations of the Company under the notes, the indenture, the security documents and, if then in effect, the registration rights agreement pursuant to agreements reasonably satisfactory to the trustee;

	(3) immediately after such transaction, no Default exists; and

	(4) the Company or the Successor Company, as the case may be, would on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable four-quarter period, (a) be permitted to incur at least $1.00 of

additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described above under the caption “— Incurrence of Indebtedness and Issuance of Preferred Stock” or (b) have a Fixed Charge Coverage Ratio that is no worse than the Fixed Charge Coverage Ratio of the Company immediately preceding such consolidation, merger, sale, assignment, transfer, conveyance or other disposition.

The foregoing clause (4) will not prohibit (a) the Escrow Merger, (b) a merger between the Company and any of its Restricted Subsidiaries or (c) a merger between the Company and an Affiliate of the Company incorporated solely for the purpose of reincorporating the Company in another state of the United States, so long as the amount of Indebtedness of the Company and its Restricted Subsidiaries is not increased thereby.

In addition, the Company may not, directly or indirectly, lease all or substantially all of its properties or assets, in one or more related transactions, to any other Person. This “Merger, Consolidation or Sale of Assets” covenant will not apply to a sale, assignment, transfer, conveyance or other disposition of assets between or among the Company, any of its Wholly Owned Restricted Subsidiaries and any of the Guarantors.

The Successor Company will be the successor to the Company and shall succeed to, and be substituted for, and may exercise every right and power of, the Company under the indenture, and the predecessor company.

The Company will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each, an “Affiliate Transaction”), unless:


	(1) the Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person; and

	(2) the Company delivers to the trustee:


	(a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $5.0 million, a resolution of the Board of Directors of the Company set forth in an officers’ certificate certifying that such Affiliate Transaction complies with this covenant 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 $15.0 million, an opinion issued by an accounting, appraisal or investment banking firm of national standing as to the fairness to the Company of such Affiliate Transaction from a financial point of view or that such Affiliate Transaction is not materially less favorable to the Company and its Restricted Subsidiaries than would reasonably be expected to be obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person.

The following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of the prior paragraph:


	(1) any employment agreement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business of the Company or such Restricted Subsidiary;

	(2) transactions between or among the Company and/or its Restricted Subsidiaries;

	(3) transactions with a Person (other than an Unrestricted Subsidiary of the Company) that is an Affiliate of the Company solely because the Company owns, directly or through a Restricted Subsidiary, an Equity Interest in, or controls, such Person;


	(4) payment of reasonable directors fees;

	(5) the Pledge of Equity Interests of Unrestricted Subsidiaries to support the Indebtedness thereof;

	(6) loans and advances to employees made in the ordinary course of business consistent with past practices of the Company or such Restricted Subsidiary, as the case may be;

	(7) any agreement as in effect on the date of the indenture and any amendment, modification, supplement, renewal, replacement or extension thereof (so long as such amendment, modification, supplement, renewal, replacement or extension is not materially less favorable to the holders of the notes);

	(8) the issuance or sale of Equity Interests (other than Disqualified Stock) of the Company;

	(9) transactions between a Receivables Subsidiary and any Person in which the Receivables Subsidiary has an Investment; and

	(10) Restricted Payments that are permitted by the provisions of the indenture described above under the caption “— Restricted Payments” or any Permitted Investment.

If the Company or any of its Restricted Subsidiaries acquires or creates another Domestic Restricted Subsidiary after the date of the indenture (except for Subsidiaries that have properly been designated as Unrestricted Subsidiaries in accordance with the indenture for so long as they continue to constitute Unrestricted Subsidiaries) or any other Restricted Subsidiary guarantees or otherwise provides direct credit support for any Indebtedness of the Company or any Guarantor, then that Subsidiary (other than a Receivables Subsidiary) will (a) execute a supplemental indenture and a joinder agreement to the security documents in form and substance reasonably satisfactory to the trustee providing that such Subsidiary shall become a Guarantor under the indenture and a party to the security documents and (b) deliver an opinion of counsel to the effect that such supplemental indenture and joinder agreement has been duly authorized and executed by such Subsidiary, in each case, within 10 Business Days following the date on which it was acquired or created; provided that any Domestic Restricted Subsidiary that constitutes an Immaterial Subsidiary need not become a Guarantor until such time as it ceases to be an Immaterial Subsidiary.

If the Company or any of the Guarantors at any time (a) owns or acquires Senior Secured Note Priority Collateral that is not subject to a valid, enforceable perfected first priority Lien (subject to Permitted Prior Liens) in favor of the collateral agent as security for the Senior Secured Note Obligations or (b) grants, assumes or becomes subject to any Lien upon any of its property that constitutes Credit Facility Priority Collateral as security for any Credit Facility Obligation, then the Company will, or will cause such Guarantor to, concurrently:


	(1) execute and deliver to the collateral agent a security document upon substantially the same terms as the security documents delivered in connection with the issuance of the notes, granting, in the case of any Senior Secured Note Priority Collateral, a first priority Lien upon such Senior Secured Note Priority Collateral or, in the case of any Credit Facility Priority Collateral, a second priority Lien upon such Credit Facility Priority Collateral, in either case, in favor of the collateral agent for the benefit of the holders of the Senior Secured Note Obligations; and

	(2) cause any such Lien granted in such security document to be duly perfected in any manner permitted by law and, in the case of any Senior Secured Note Priority Collateral, cause each other Lien upon such Senior Secured Note Priority Collateral to be (a) released, unless it is a Permitted Lien or (b) subordinated to the Senior Secured Note Liens if it is a Permitted Lien but not a Permitted Prior Lien.

The Board of Directors may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default, provided, that in no event may the Board of Directors designate any (a) Restricted Subsidiary that holds assets constituting Senior Secured Note Priority Collateral having a fair value of greater than $5.0 million or (b) group of Restricted Subsidiaries that together hold assets constituting Senior Secured Note Priority Collateral having a fair value of greater than $5.0 million, to be an Unrestricted Subsidiary or Unrestricted Subsidiaries, as the case may be. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the Subsidiary properly designated will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under the first paragraph of the covenant described above under the caption “— Restricted Payments” or Permitted Investments, as determined by the Company. That designation will only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Board of Directors may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would not cause a Default.

The Company will not, and will not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided that the Company or any Restricted Subsidiary may enter into a sale and leaseback transaction if:


	(1) the Company or that Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction under any provision of the covenant described above under the caption “— Incurrence of Indebtedness and Issuance of Preferred Stock” and (b) incurred a Lien to secure such Indebtedness pursuant to the covenant described above under the caption “— Liens”;

	(2) the gross cash proceeds of that sale and leaseback transaction are at least equal to the fair market value, as determined in good faith by the Board of Directors and set forth in an officers’ certificate delivered to the trustee if such gross cash proceeds are more than $10.0 million, of the property that is the subject of that sale and leaseback transaction; and

	(3) the transfer of assets in that sale and leaseback transaction is permitted by, and, if such transfer is an Asset Sale, the Company applies the proceeds of such transaction in compliance with, the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales.”

The Company will not, and will not permit any Subsidiary to, engage in any business other than Permitted Business, except to such extent as would not be material to the Company and its Subsidiaries taken as a whole.

The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any Holder of notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the indenture or the notes unless such consideration is offered to be paid and is paid to all Holders of the notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.

Whether or not required by the Commission’s rules and regulations, so long as any notes are outstanding, the Company will furnish to the Holders of notes, within the time periods specified in the Commission’s rules and regulations:


	(1) all quarterly and annual reports that would be required to be filed with the Commission on Forms 10-Q and 10-K if the Company were required to file such reports; and

	(2) all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file such reports;

provided, however, that the availability of the foregoing materials on the SEC’s EDGAR service or the Company’s website shall be deemed to satisfy the Company’s delivery obligation set forth above.

All reports required by the first paragraph of this covenant will be prepared in all material respects in accordance with all of the rules and regulations applicable to such reports. Each annual report on Form 10-K will include a report on the Company’s consolidated financial statements by the Company’s certified independent accountants. In addition, the Company will file a copy of each of the reports referred to in clauses (1) and (2) above with the Commission for public availability within the time periods specified in the rules and regulations applicable to such reports (unless the Commission will not accept such a filing) and make such information available to securities analysts and prospective investors upon request.

If, at any time, the Company is not subject to the periodic reporting requirements of the Exchange Act for any reason, the Company will nevertheless continue filing the reports specified in the preceding paragraph with the Commission within the time periods specified above unless the Commission will not accept such a filing. If the Commission will not accept the Company’s filings for any reason, the Company will post the reports referred to in the preceding paragraph on its website within the time periods that would apply if the Company were required to file those reports with the Commission.

In addition, the Company and the Guarantors agree that, for so long as any notes remain outstanding, at any time they are not required to file the reports required by the preceding paragraphs with the Commission, they 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.


	(1) default for 30 days in the payment when due of interest on, or Liquidated Damages with respect to, the notes;

	(2) default in payment when due of the principal of, or premium, if any, on the notes;

	(3) failure by the Company to comply with its obligations under “— Repurchase at the Option of Holders — Change of Control,” “— Repurchase at the Option of Holders — Asset Sales” and “— Certain Covenants — Merger, Consolidation or Sale of Assets”;

	(4) failure by the Company or any of its Restricted Subsidiaries for 30 days after receipt by the Company of written notice as provided below to comply with the provisions described under the captions “— Certain Covenants — Restricted Payments” or “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock;”

	(5) failure by the Company or any of its Restricted Subsidiaries for 60 days after receipt by the Company of written notice as provided below to comply with any of the other agreements in the indenture, the escrow agreement, the notes or the security documents;

	(6) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its


	Restricted Subsidiaries) whether such Indebtedness or guarantee now exists, or is created after the date of the indenture, if that default:

(a) is caused by a failure to pay principal of such Indebtedness (after giving effect to any applicable grace period provided in such Indebtedness) on the date of its Stated Maturity (a “Payment Default”) or (b) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $15.0 million or more;


	(7) failure by the Company or any of its Restricted Subsidiaries to pay final, non-appealable judgments entered by a court or courts of competent jurisdiction aggregating in excess of $15.0 million, which judgments are not paid, discharged or stayed for a period of 60 days;

	(8) the escrow agreement or any other security document or any Lien purported to be granted thereby on the Escrow Account or the cash therein, the Eurobond escrow agreement or any other security document or any Lien proposed to be granted thereby on the Eurobond Escrow Account or the cash therein, or any one or more other items of Collateral having an aggregate fair market value in excess of $15.0 million, is held in any judicial proceeding to be unenforceable or invalid, in whole or in part, or ceases for any reason (other than pursuant to a release that is delivered or becomes effective as set forth in the indenture) to be fully enforceable and perfected; provided that if the holders of the Series B Notes and the common stock into which the Series A Notes were converted waive the requirement in the Note Purchase Agreement for the establishment of the Eurobond Escrow Account, then the failure to establish the Eurobond Escrow Account or execute the Eurobond escrow agreement (or the termination of the Eurobond escrow agreement and dissolution of the Eurobond Escrow Account) shall not be deemed an Event of Default;

	(9) the Company or any Guarantor denies or disaffirms, in writing in any pleading in any court of competent jurisdiction, any obligation of the Company or any Guarantor set forth in or arising under any security document;

	(10) except as permitted by the indenture, any Guarantee shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect and such default continues for 10 days after notice or any Guarantor, or any Person acting on behalf of any Guarantor, shall deny or disaffirm its obligations under its Guarantee in writing;

	(11) certain events of bankruptcy or insolvency described in the indenture with respect to the Company or any of its Restricted Subsidiaries that are Significant Subsidiaries.

However, a default under clauses (4), (5) or (10) will not constitute an Event of Default until the trustee or the holders of 25% in principal amount of the outstanding Notes notify the Company of the default and the Company does not cure such default within the time specified after receipt of such notice. In the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to the Company, the principal amount of and accrued and unpaid interest and Liquidated Damages, if any, will become due and payable immediately without further action or notice. If any other Event of Default occurs and is continuing, the trustee or the Holders of at least 25% in principal amount of the then outstanding notes may declare the principal amount of and accrued and unpaid interest and Liquidated Damages, if any, on all the notes to be due and payable immediately.

Holders of the notes may not enforce the indenture or the notes except as provided in the indenture. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding notes may direct the trustee in its exercise of any trust or power. The trustee may withhold from Holders of the notes notice of any continuing Default or Event of Default if it determines that withholding notes is in their interest, except a Default or Event of Default relating to the payment of principal or interest or Liquidated Damages.

The Holders of a majority in aggregate principal amount of the notes then outstanding by notice to the trustee may on behalf of the Holders of all of the notes waive any existing Default and its consequences under

The Company is required to deliver to the trustee within 90 days after the end of each fiscal year a statement regarding compliance with the indenture during such fiscal year. Upon becoming aware of any Default, the Company is required to deliver to the trustee a statement specifying such Default.

No holder of notes will have any right to institute any proceeding with respect to the indenture, or for the appointment of a receiver or a trustee, or for any remedy thereunder, unless:


	(1) such holder has previously given to the trustee written notice of a continuing Event of Default;

	(2) the holders of at least 25% in aggregate principal amount of the notes then outstanding have made written request and offered reasonable indemnity to the trustee to institute a proceeding as trustee; and

	(3) the trustee shall not have received from the holders of a majority in aggregate principal amount of the notes then outstanding a direction inconsistent with such request and shall have failed to institute such proceeding with 60 days.

However, such limitations do not apply to a suit instituted by a holder of any note for enforcement of payment of the principal of, or interest or Liquidated Damages on, such note on or after the respective due dates.

No director, officer, employee, incorporator or stockholder of the Company or any Guarantor, as such, will have any liability for any obligations of the Company or the Guarantors under the notes, the indenture, the Guarantees, the intercreditor agreement, the security documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of notes by accepting a note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the notes. The waiver may not be effective to waive liabilities under the federal securities laws and its is the view of the Commission that such a waiver is against public policy.

The Company may, at its option and at any time, elect to have all of its obligations discharged with respect to the outstanding notes and all obligations of the Guarantors discharged with respect to their Guarantees (“Legal Defeasance”) except for:


	(1) the rights of Holders of outstanding notes to receive payments in respect of the principal of, or interest or premium and Liquidated Damages, if any, on such notes when such payments are due from the trust referred to below;

	(2) the Company’s obligations to issue temporary notes, register the transfer or exchange of notes, replace mutilated, destroyed, lost or stolen notes and to maintain a register and paying agent in respect of the notes;

	(3) the rights, powers, trusts, duties and immunities of the trustee, and the Company’s and the Guarantor’s obligations in connection therewith; and

	(4) the Legal Defeasance provisions of the indenture.

In addition, the Company may, at its option and at any time, elect to have the obligations of the Company and the Guarantors released with respect to certain covenants that are described in the indenture (“Covenant Defeasance”) and thereafter any omission to comply with those covenants will not constitute a Default with respect to the notes. In the event Covenant Defeasance occurs, certain events (not including nonpayment


	(1) the Company must irrevocably deposit with the trustee, in trust, for the benefit of the Holders of the notes, cash in U.S. dollars, noncallable Government Securities, or a combination of cash in U.S. dollars and noncallable Government Securities, 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 Liquidated Damages, if any, on the outstanding notes on the stated maturity or on the applicable redemption date, as the case may be, and the Company must specify whether the notes are being defeased to maturity or to a particular redemption date;

	(2) in the case of Legal Defeasance only, the Company has delivered to the trustee an opinion of counsel reasonably acceptable to the trustee confirming that (a) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the date of the indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel will confirm that, the Holders of the outstanding notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

	(3) in the case of Covenant Defeasance only, the Company has delivered to the trustee an opinion of counsel reasonably acceptable to the trustee confirming that the Holders of the outstanding notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

	(4) no Default 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);

	(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 the indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound;

	(6) the Company must deliver to the trustee an officers’ certificate stating that the deposit was not made by the Company with the intent of preferring the Holders of notes over the other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; and

	(7) the Company 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.

The Collateral will be released from the Senior Secured Note Liens, as provided under the caption “— Security — Release of Security Interests,” upon a Legal Defeasance or Covenant Defeasance in accordance with the provisions described above.

Except as provided in the next two succeeding paragraphs, the indenture, the notes or the Guarantees thereof may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, notes), and any existing default or compliance with any provision of the indenture or the notes may be waived with the consent of the Holders of a majority in principal amount of the then outstanding notes (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, notes).

Without the consent of each Holder affected, an amendment or waiver may not (with respect to any notes held by a nonconsenting Holder):


	(1) reduce the principal amount of notes whose Holders must consent to an amendment, supplement or waiver;

	(2) reduce the principal of or principal amount of or change the fixed maturity of any note or alter the provisions with respect to the redemption of the notes (other than provisions relating to the covenants described above under the caption “— Repurchase at the Option of Holders”);

	(3) reduce the rate of or change the time for payment of interest on any note;

	(4) waive a Default in the payment of principal of, or interest or premium, or Liquidated Damages, if any, on the notes (except a rescission of acceleration of the notes by the Holders of at least a majority in aggregate principal amount of the notes and a waiver of the payment default that resulted from such acceleration);

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

	(6) make any change in the provisions of the indenture relating to waivers of past Defaults or the rights of Holders of notes to receive payments of principal of, or interest or premium or Liquidated Damages, if any, on the notes;

	(7) waive a redemption payment with respect to any note (other than a payment required by one of the covenants described above under the caption “— Repurchase at the Option of Holders”); or

	(8) make any change in the preceding amendment and waiver provisions.

In addition, any amendment to, or waiver of, the provisions of the indenture to release all or substantially all of the Collateral from the Liens securing the notes or to release any Guarantor from any of its obligations under its Guarantee or the indenture, except in accordance with the terms of the indenture, will require the consent of the Holders of at least 66 2/3% in aggregate principal amount of the notes then outstanding. Further, no amendment or supplement that imposes any obligation on the trustee or the collateral agent or adversely affect the rights of the trustee or the collateral agent in its individual capacity shall become effective without the consent of such party.

Notwithstanding the preceding, without the consent of any Holder of notes, the Company, the Guarantors and the trustee may amend or supplement the indenture, the notes, the Guarantees or the security documents:


	(1) to cure any ambiguity, defect or inconsistency or to make a modification of a formal, minor or technical nature or correct a manifest error;

	(2) to provide for uncertificated notes in addition to or in place of certificated notes;

	(3) to provide for the assumption of the Company’s or any Guarantor’s obligations to Holders of notes in the case of a merger or consolidation or sale of all or substantially all of the Company’s assets;

	(4) to add to the covenants of the Company or any Guarantor for the benefit of holders of the notes or surrender any right or power conferred upon the Company or any Guarantor;

	(5) to make any change that would provide any additional rights or benefits to the Holders of notes or that does not adversely affect the legal rights under the indenture of any such Holder;

	(6) to comply with any requirement of the Commission in connection with the qualification of the indenture under the Trust Indenture Act;

	(7) to add any additional Guarantor or to release any Guarantor from its Guarantee, to evidence or provide for the acceptance of appointment of a successor trustee or to add any additional Events of Default, in each case, as provided in the indenture;


	(8) to make, complete or confirm any grant of a security interest in any Collateral permitted or required by the security documents or the indenture or any release of Collateral that becomes effective as set forth in the security documents or the indenture;

	(9) to conform the text of the indenture, the Guarantees, the intercreditor agreement, the other security documents or the notes to any provision of this “Description of Senior Secured Notes” to the extent that such provision in this “Description of Senior Secured Notes” was intended to be a verbatim recitation of a provision of the indenture, the Guarantees, the intercreditor agreement, the other security documents or the notes;

	(10) to comply with the covenant relating to mergers, amalgamations, consolidations and sale of assets;

	(11) to reflect any waiver or termination of any right arising under the provisions set forth under the caption “— Intercreditor Agreement” that otherwise would be enforceable by any holder of a Credit Facility Lien, if such waiver or termination is set forth or provided in the indenture, any of the security documents or the agreement governing or giving rise to such Credit Facility Lien, provided that no such waiver or amendment pursuant to this clause (11) shall adversely affect the rights of Holders of the notes; and

	(12) to release Collateral constituting Excluded Securities in accordance with the conditions set forth in the definition of Excluded Assets.

The indenture will be discharged and will cease to be of further effect as to all notes issued thereunder, when:


	(a) all notes that have been authenticated, except lost, stolen or destroyed notes that have been replaced or paid and notes for whose payment money has been deposited in trust and thereafter repaid to the Company, have been delivered to the trustee for cancellation; or

	(b) all notes that have not been delivered to the trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company or any Guarantor has irrevocably deposited or caused to be deposited with the trustee as trust funds in trust solely for the benefit of the Holders, cash in U.S. dollars, noncallable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities, in amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on the notes not delivered to the trustee for cancellation for principal, premium and Liquidated Damages, if any, and accrued interest to the date of maturity or redemption;


	(2) no Default has occurred and is continuing on the date of the deposit or will occur as a result of the deposit and the deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or any Guarantor is a party or by which the Company or any Guarantor is bound;

	(3) the Company or any Guarantor has paid or caused to be paid all sums payable by it under the indenture; and

	(4) the Company has delivered irrevocable instructions to the trustee under the indenture to apply the deposited money toward the payment of the notes at maturity or the redemption date, as the case may be.

In addition, the Company must deliver an officers’ certificate and an opinion of counsel to the trustee stating that all conditions precedent to satisfaction and discharge have been satisfied.

The Collateral will be released from the Senior Secured Note Liens, as provided under the caption “— Security — Release of Security Interests,” upon a satisfaction and discharge in accordance with the provisions described above.

If the trustee becomes a creditor of the Company or any Guarantor, the indenture limits its right to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue or resign.

The Holders of a majority in principal amount of the then outstanding notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the trustee, subject to certain exceptions. The indenture provides that in case an Event of Default occurs and is continuing, the trustee will be required, in the exercise of its power, to use the degree of care of a prudent man in the conduct of his own affairs. Subject to such provisions, the trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request of any Holder of notes, unless such Holder has offered to the trustee security and indemnity satisfactory to it against any loss, liability or expense.

Anyone who receives this prospectus may obtain a copy of the indenture, the registration rights agreement, the security documents and the intercreditor agreement without charge by writing to Milacron Inc., 2090 Florence Avenue, Cincinnati, Ohio 45206, Attention: General Counsel.

The exchange notes will be represented by one or more notes in registered, global form without interest coupons (collectively, the “Global Notes”). The Global Notes will be deposited upon issuance with the trustee as custodian for The Depositary Trust Company (“DTC”), in New York, New York, and registered in the name of DTC or its nominee, in each case for credit to an account of a direct or indirect participant in DTC as described below.

Except as set forth below, the Global Notes may be transferred, in whole and not in part, only to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in the Global Notes may not be exchanged for notes in certificated form except in the limited circumstances described below. See “— Exchange of Global Notes for Certificated Notes.” Except in the limited circumstances described below, owners of beneficial interests in the Global Notes will not be entitled to receive physical delivery of notes in certificated form. Transfers of beneficial interests in the Global Notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, which may change from time to time.

The following description of the operations and procedures of DTC is provided solely as a matter of convenience. These operations and procedures are solely within the control of DTC and are subject to changes by DTC. The Company takes no responsibility for these operations and procedures and urges investors to contact DTC or its participants directly to discuss these matters.

DTC has advised the Company that DTC is a limited-purpose trust company created to hold securities for its participating organizations (collectively, the “Participants”) and to facilitate the clearance and settlement of transactions in those securities between Participants through electronic book-entry changes in accounts of its Participants. The Participants include securities brokers and dealers (including the Initial Purchasers), banks, trust companies, clearing corporations and certain other organizations. Access to DTC’s system is also available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Participant, either directly or indirectly (collectively, the “Indirect

Participants”). Persons who are not Participants may beneficially own securities held by or on behalf of DTC only through the Participants or the Indirect Participants. The ownership interests in, and transfers of ownership interests in, each security held by or on behalf of DTC are recorded on the records of the Participants and Indirect Participants.

DTC has also advised the Company that, pursuant to procedures established by it:


	(1) upon deposit of the Global Notes, DTC will credit the accounts of Participants designated by the Initial Purchasers with portions of the principal amount of the Global Notes; and

	(2) ownership of these interests in the Global Notes will be shown on, and the transfer of ownership of these interests will be effected only through, records maintained by DTC (with respect to the Participants) or by the Participants and the Indirect Participants (with respect to other owners of beneficial interest in the Global Notes).

Investors in the Global Notes who are Participants in DTC’s system may hold their interests therein directly through DTC. Investors in the Global Notes who are not Participants may hold their interests therein indirectly through organizations which are Participants in such system. All interests in a Global Note may be subject to the disclosures and requirements of DTC. The laws of some states require that certain Persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer beneficial interests in a Global Note to such Persons will be limited to that extent. Because DTC can act only on behalf of Participants, which in turn act on behalf of Indirect Participants, the ability of a Person having beneficial interests in a Global Note to pledge such interests to Persons that do not participate in the DTC system, or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests.

Except as described below, owners of interest in the Global Notes will not have notes registered in their names, will not receive physical delivery of notes in certificated form and will not be considered the registered owners or “Holders” thereof under the indenture for any purpose.

Payments in respect of the principal of, and interest and premium and Liquidated Damages, if any, on a Global Note registered in the name of DTC or its nominee will be payable to DTC in its capacity as the registered Holder under the indenture. Under the terms of the indenture, the Company and the trustee will treat the Persons in whose names the notes, including the Global Notes, are registered as the owners of the notes for the purpose of receiving payments and for all other purposes. Consequently, neither the Company, the trustee nor any agent of the Company or the trustee has or will have any responsibility or liability for:


	(1) any aspect of DTC’s records or any Participant’s or Indirect Participant’s records relating to or payments made on account of beneficial ownership interest in the Global Notes or for maintaining, supervising or reviewing any of DTC’s records or any Participant’s or Indirect Participant’s records relating to the beneficial ownership interests in the Global Notes; or

	(2) any other matter relating to the actions and practices of DTC or any of its Participants or Indirect Participants.

DTC has advised the Company that its current practice, upon receipt of any payment in respect of securities such as the notes (including principal and interest), is to credit the accounts of the relevant Participants with the payment on the payment date unless DTC has reason to believe it will not receive payment on such payment date. Each relevant Participant is credited with an amount proportionate to its beneficial ownership of an interest in the principal amount of the relevant security as shown on the records of DTC. Payments by the Participants and the Indirect Participants to the beneficial owners of notes will be governed by standing instructions and customary practices and will be the responsibility of the Participants or the Indirect Participants and will not be the responsibility of DTC, the trustee or the Company. Neither the Company nor the trustee will be liable for any delay by DTC or any of its Participants in identifying the beneficial owners of the notes, and the Company and the trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee for all purposes.

DTC has advised the Company that it will take any action permitted to be taken by a Holder of notes only at the direction of one or more Participants to whose account DTC has credited the interests in the Global Notes and only in respect of such portion of the aggregate principal amount of the notes as to which such Participant or Participants has or have given such direction. However, if there is an Event of Default under the notes, DTC reserves the right to exchange the Global Notes for legended notes in certificated form, and to distribute such notes to its Participants.

Although DTC has agreed to the foregoing procedures to facilitate transfers of interests in the Global Notes among Participants in DTC they are under no obligation to perform or to continue to perform such procedures, and may discontinue such procedures at any time. Neither the Company nor the trustee nor any of their respective agents will have any responsibility for the performance by DTC or its Participants or indirect Participants of its obligations under the rules and procedures governing their operations.

Neither the Company nor the trustee nor any of their respective agents will have any responsibility for the performance by DTC or its Participants or Indirect Participants of their respective obligations under the rules and procedure governing their operations.

A Global Note is exchangeable for definitive notes in registered certificated form (“Certificated Notes”) if:


	(1) DTC (a) notifies the Company that it is unwilling or unable to continue as depositary for the Global Notes and the Company fails to appoint a successor depositary or (b) has ceased to be a clearing agency registered under the Exchange Act and the Company fails to appoint a successor depositary;

	(2) the Company, at its option, notifies the trustee in writing that it elects to cause the issuance of the Certificated Notes; or

	(3) there has occurred and is continuing an Event of Default with respect to the notes.

In addition, beneficial interests in a Global Note may be exchanged for Certificated Notes upon prior written notice given to the trustee by or on behalf of DTC in accordance with the indenture. In all cases, Certificated Notes delivered in exchange for any Global Note or beneficial interests in Global Notes will be registered in the names, and issued in any approved denominations, requested by or on behalf of the depositary (in accordance with its customary procedures).

The Company will make payments in respect of the notes represented by the Global Notes (including principal, premium, if any, interest and Liquidated Damages, if any) by wire transfer of immediately available funds to the accounts specified by the Global Note Holder. The Company will make all payments of principal, interest and premium and Liquidated Damages, if any, with respect to Certificated Notes by wire transfer of immediately available funds to the accounts specified by the Holders of the Certificated Notes or, if no such account is specified, by mailing a check to each such Holder’s registered address. The notes represented by the Global Notes are expected to trade in DTC’s Same-Day Funds Settlement System, and any permitted secondary market trading activity in such notes will, therefore, be required by DTC to be settled in immediately available funds. The Company expects that secondary trading in any Certificated Notes will also be settled in immediately available funds.

Set forth below are certain defined terms used in this “Description of Senior Secured Notes.” Reference is made to the indenture, the intercreditor agreement and the security documents for a full disclosure of all such terms, as well as any other capitalized terms used herein for which no definition is provided.

“ABL Facility” means the Financing Agreement dated on or before the date of the Escrow Merger by and among Milacron, as a borrower, certain subsidiaries of Milacron, as additional borrowers or guarantors,


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

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

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be control. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings. No Person (other than the Company or any Subsidiary of the Company) in whom a Receivables Subsidiary makes an Investment in connection with a Qualified Receivables Transaction will be deemed to be an Affiliate of the Company or any of its Subsidiaries solely by reason of such Investment.

“Affiliate Transaction” has the meaning set forth under the caption “— Certain Covenants — Transactions with Affiliates.”

“Applicable Premium” means, with respect to a note at any Make-Whole Redemption Date, the greater of (1) 1.0% of the principal amount of such note and (2) the excess of (a) the present value at such time of (i) the par value of such note plus (ii) all required interest payments due on such note through May 15, 2011, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the principal amount of such note.


	(1) the sale, lease, conveyance or other disposition of any assets or rights (including, without limitation, by way of a sale and leaseback) or any damage or loss of property resulting in the payment of property insurance or condemnation proceeds to the Company or any Restricted Subsidiary; provided that the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its Subsidiaries taken as a whole will be governed by the provisions of the indenture described above under the caption “— Repurchase at the Option of Holders — Change of Control” and/or the provisions described above under the caption “— Certain Covenants — Merger, Consolidation or Sale of Assets” and not by the provisions of the Asset Sale covenant; and

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

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


	(1) any single transaction or series of related transactions that involves assets having a fair market value of less than $2.0 million or for net cash proceeds of less than $2.0 million;

	(2) a transfer of assets between or among the Company and its Restricted Subsidiaries,

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

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


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

	(6) any sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;

	(7) sales of property or equipment that has become worn out, obsolete or damaged;

	(8) the license of patents, trademarks, copyrights, designs and know-how to third parties in the ordinary course of business;

	(9) the creation of Liens;

	(10) the sale or transfer of accounts receivable and related assets of the type specified in the definition of “Qualified Receivables Transaction” to a Receivables Subsidiary; and

	(11) a Restricted Payment or Permitted Investment that is permitted by the covenant described above under the caption “— Certain Covenants — Restricted Payments.”

“Asset Sale Proceeds Account” has the meaning set forth under the caption “— Repurchase at the Option of Holder — Asset Sales.”

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

“Bank Product Agreements” means any agreement pursuant to which a bank or other financial institution agrees to provide treasury management services (including, without limitation, controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services).

“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.


	(1) with respect to a corporation, the board of directors of the corporation or any duly authorized committee thereof;

	(2) with respect to a partnership, the Board of Directors of the general partner of the partnership or any duly authorized committee thereof; and

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

“Canadian Restricted Subsidiary” means any Restricted Subsidiary of the Company that was formed under the laws of Canada or any province of Canada.

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


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

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


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

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


	(1) United States dollars and any other currency that is convertible into United States dollars without legal restrictions and which is utilized by the Company or any of its Restricted Subsidiaries in the ordinary course of its business;

	(2) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States is pledged in support of those securities);

	(3) time deposit accounts, certificates of deposit and money market deposits maturing within one year of the date of acquisition thereof, bankers’ acceptances with maturities not exceeding six months and overnight bank deposits, in each case with a bank or trust company which is organized under the laws of the United States, any state thereof or any foreign country recognized by the United States, and which bank or trust company has capital, surplus and undivided profits aggregating in excess of $250.0 million (or the foreign currency equivalent thereof) and has outstanding debt which is rated “A” (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) or any money-market fund sponsored by a registered broker dealer or mutual fund distributor;

	(4) repurchase obligations with a term of not more than seven days 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 having one of the two highest ratings obtainable from Moody’s and S&P (or by a nationally recognized rating agency or agencies if one or both of the named rating agencies cease publishing ratings of investments) and in each case maturing within one year after the date of acquisition;

	(6) money market 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) in the case of any Subsidiary organized or having its principal place of business outside the United States, investments denominated in the currency of the jurisdiction in which that Subsidiary is organized or has its principal place of business which are similar to the items specified in clauses (1) through (6) above, including, without limitation, any deposit with a bank that is a lender to any Restricted Subsidiary of the Company.

“Certificated Notes” has the meaning set forth under the caption “— Book-Entry, Delivery and Form.”


	(1) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its Restricted Subsidiaries taken as a whole to any “person” (as that term is defined in Section 13(d)(3) of the Exchange Act) other than one or more Permitted Holders;

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

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


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

“Change of Control Offer” has the meaning set forth under the caption “— Repurchase at the Option of Holders — Change of Control.”

“Change of Control Payment” has the meaning set forth under the caption “— Repurchase at the Option of Holders — Change of Control.”

“Change of Control Payment Date” has the meaning set forth under the caption “— Repurchase at the Option of Holders — Change of Control.”

“Code” means the New York UCC; provided that to the extent that the Code is used to define any term in any security document and such term is defined differently in differing Articles of the Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, publication or priority of, or remedies with respect to, Credit Facility Liens or Senior Secured Note Liens is governed by the Uniform Commercial Code or foreign personal property security laws as enacted and in effect in a jurisdiction other than the State of New York, the term “Code” will mean the Uniform Commercial Code or such foreign personal property security laws as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.

“Collateral” means all property now owned or hereafter acquired by the Company or any Guarantor in or upon which a Lien is granted or purported to be granted to the Credit Facility Agent or the trustee or collateral agent under any of the security documents, together with all rents, issues, profits, products, and proceeds thereof, which shall not in any event include:


	(1) Excluded Assets; and

	(2) any properties and assets in which the collateral agent is required to release its Liens pursuant to the provisions described above under the caption “— Security — Release of Security Interests,” provided that if such Liens are required to be released as a result of the sale, transfer or other disposition of any properties or assets of the Company or any Guarantor, such assets or properties will cease to be excluded from the Collateral if the Company or any Guarantor thereafter acquires or reacquires such assets or properties.

“collateral agent” means U.S. Bank National Association in its capacity as collateral agent under the security documents, together with its successors in such capacity.

“Collateral Proceeds Offer” has the meaning set forth under the caption “— Repurchase at the Option of Holders — Asset Sales.”

“Consolidated Cash Flow” means, with respect to any specified Person for any period, the Consolidated Net Income of such Person and its Restricted Subsidiaries for such period plus:


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

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

	(3) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued and whether or not capitalized (including, without limitation, amortization of debt issuance costs and original issue discount, noncash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers’ acceptance financings, and net of the effect


	of all payments made or received pursuant to Hedging Obligations), to the extent that any such expense was deducted in computing such Consolidated Net Income; plus

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

	(5) any nonrecurring expenses and charges and any restructuring charges of such Person and its Restricted Subsidiaries; minus

	(6) any extraordinary or nonrecurring items increasing such Consolidated Net Income for such period, other than the accrual of revenue in the ordinary course of business,

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


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

	(2) the Net Income of any Restricted Subsidiary of such Person will be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders; provided, however, that if such declaration or payment of dividends or similar distributions is not permitted solely by the operation of the terms of a Foreign Credit Facility permitted to be incurred by the terms of the indenture, the Net Income of such Restricted Subsidiary may be included to the extent of the actual dividends or distributions paid to such Person during such period; and

	(3) the cumulative effect of a change in accounting principles will be excluded.

“Continuing Directors” means, as of any date of determination, any member of the Board of Directors of the Company who:


	(1) was a member of such Board of Directors on the date of the indenture;

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

	(3) was nominated by or on behalf of a Permitted Holder if such Permitted Holder beneficially owned more than 10.0% of the Company’s Voting Stock at the time of such nomination.

“Covenant Defeasance” has the meaning set forth under the caption “— Legal Defeasance and Covenant Defeasance.”

“Credit Facility” means, with respect to the Company or any Restricted Subsidiary, one or more debt facilities (including, without limitation, the ABL Facility), debt securities sales arrangements or commercial paper facilities, in each case with, or sold to, banks or other institutional lenders or investors providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables), letters of

credit or other Indebtedness, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part, and without limitation as to amount, terms, conditions, covenants and other provisions) from time to time, and any agreement (and related documents and instruments) governing Indebtedness incurred to refinance, in whole or in part, the borrowings and commitments then outstanding or permitted to be outstanding under such debt or successor debt, whether by the same or any other lender or investor or group of lenders or investors.

“Credit Facility Agent” means, at any time in respect of any Credit Facility, the Person serving at such time as the “Agent,” “Administrative Agent,” “Collateral Agent,” “ABL Agent” or “Collateral Trustee” under such Credit Facility or any other representative then most recently designated in accordance with the applicable provisions of the Credit Facility, together with its successors in such capacity.

“Credit Facility Debt” means Indebtedness under a Qualified Credit Facility.

“Credit Facility Documents” means the credit agreement with respect to the ABL Facility and any other Qualified Credit Facility pursuant to which any Credit Facility Debt is incurred, including the guaranty agreements, bank product agreements, hedging agreements, and security documents related thereto (other than any security documents that do not secure Credit Facility Obligations), as well as those other ancillary agreements as to which the Credit Facility Agent or any lender is a party or a beneficiary and all other agreements, instruments, documents and certificates executed in connection with any of the foregoing or any Qualified Credit Facility.

“Credit Facility Lien” means any Lien upon Credit Facility Priority Collateral granted to any holder, or representative of holders (including a Credit Facility Agent), of the Credit Facility Obligations, as security for Credit Facility Obligations.


	(1) the Credit Facility Debt and all other Obligations under any Qualified Credit Facility or any related Credit Facility Documents; and

	(2) all Hedging Obligations and Obligations under Bank Products Agreements; provided that the counterparty to such Hedging Obligation or the Person holding such Obligations under Bank Product Agreements is a Qualified Counterparty.

“Credit Facility Priority Collateral” means all Collateral consisting of the following, other than the Excluded Assets:


	(1) all accounts and receivables (each as defined in Article 9 of the Code);

	(2) all chattel paper, including tangible chattel paper and electronic chattel paper (each as defined in Article 9 of the Code);

	(3) (a) all deposit accounts and money (each as defined in Article 9 of the Code) and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein and (b) all securities, security entitlements, and securities accounts (each as defined in Article 9 of the Code), in each case, to the extent constituting cash or cash equivalents or representing a claim to cash equivalents, except, in each case, for (x) any Asset Sale Proceeds Account and all deposits and other funds held therein, (y) any deposit account or money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein or any securities account and all cash and cash equivalents held therein that, in each case, constitute identifiable proceeds of Senior Secured Note Priority Collateral and (z) the Eurobond Escrow Account and all deposits and other funds held therein, but in any event and regardless of the foregoing clauses (x), (y) and (z), the cash management and lockbox account specified in the ABL Facility;

	(4) all inventory (as defined in Article 9 of the Code);

	(5) to the extent involving or governing any of the items referred to in the preceding clauses (1) through (4), all documents, general intangibles, instruments, including, without limitation, promissory


	notes, and letter of credit rights (each as defined in Article 9 of the Code); provided that to the extent any of the foregoing also relates to Senior Secured Note Priority Collateral, only that portion related to the items referred to in the preceding clauses (1) through (4) shall be included in the Credit Facility Priority Collateral;

	(6) to the extent evidencing or governing any of the items referred to in the preceding clauses (1) through (5), all supporting obligations (as defined in Article 9 of the Code); provided that to the extent any of the foregoing also relates to Senior Secured Note Priority Collateral, only that portion related to the items referred to in the preceding clauses (1) through (5) shall be included in the Credit Facility Priority Collateral;

	(7) all books and records (as defined in Article 9 of the Code) relating to the foregoing, including, without limitation, all books, databases, customer lists, engineer drawings and records (as defined in Article 9 of the Code), whether tangible or electronic, which contain any information relating to any of the foregoing; and

	(8) all proceeds of any of the foregoing (as defined in Article 9 of the Code), including without limitation, all insurance proceeds, and all collateral security and guarantees given by any Person with respect to any of the foregoing;

provided, however, that any Collateral, regardless of type, received in connection with a permitted disposition of or otherwise in exchange for Credit Facility Priority Collateral pursuant to the terms of the applicable Qualified Credit Facility shall be treated as Credit Facility Priority Collateral; and provided, further, that any Collateral regardless of type received in connection with a permitted disposition of or otherwise in exchange for Senior Secured Note Priority Collateral pursuant to the terms of the indenture, shall be treated as Senior Secured Note Priority Collateral.

“Currency Agreement” means, with respect to any Person, any foreign exchange contract, currency swap agreement or other similar agreement designed to protect the Person against fluctuations in currency.

“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.

“DIP Financing” has the meaning set forth under the caption “— Intercreditor Agreement — Insolvency and Liquidation.”

“Discharge of Credit Facility Obligations” means (1) the payment in full of the Credit Facility Obligations that are outstanding and unpaid at the time all indebtedness thereunder is paid in full including, with respect to amounts available to be drawn under outstanding letters of credit issued thereunder (or indemnities or other undertakings issued pursuant thereto in respect of outstanding letters of credit) delivery of money or backstop letters of credit in respect thereof in compliance with the terms of any Qualified Credit Facility (which shall not exceed an amount equal to 105% of the aggregate undrawn amount of such letters of credit), (2) the termination of all commitments to extend credit under the Credit Facility Documents, and (3) the delivery by the Credit Facility Agent of a written notice to the collateral agent stating that the events described in clauses (1) and (2) have occurred to the satisfaction of the holders of the Credit Facility Obligations.

“Discharge of Senior Secured Note Obligations” means (1) the payment in full of the Senior Secured Note Obligations that are outstanding and unpaid at the time the notes are paid in full and (2) the delivery by the trustee or the collateral agent of a written notice to the Credit Facility Agent stating that the events described in clause (1) has occurred to the satisfaction of the Holders of Senior Secured Note Obligations.

“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case at the option of the holder of the Capital Stock), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the notes mature. Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of the Capital

Stock have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the covenant described above under the caption “— Certain Covenants — Restricted Payments.”


	(1) 85% of the book value of all accounts receivable owned by the Company and its Domestic Restricted Subsidiaries and Canadian Restricted Subsidiaries; plus

	(2) 45% of the book value of all inventory owned by the Company and its Domestic Restricted Subsidiaries and Canadian Restricted Subsidiaries;

provided, however, that any accounts receivable owned by a Receivables Subsidiary, or which the Company or any of its Restricted Subsidiaries has agreed to transfer to a Receivables Subsidiary, will be excluded for purposes of determining such amount.

“Domestic Receivables Subsidiary” means any Receivables Subsidiary that was formed under the laws of the United States or any state of the United States or the District of Columbia or that was formed under the laws of Canada or any province of Canada.

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

“DTC” has the meaning set forth under the caption “— Book-Entry, Delivery and Form.”

“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).

“Escrow Account” means a segregated account, under the sole control of the trustee that includes only cash, the proceeds thereof and interest earned thereon, free from all Liens other than the Lien in favor of the trustee for the benefit of the Holders of the notes.

“Escrow Merger” means the merger of Escrow Corporation with and into Milacron pursuant to the Escrow Merger Agreement, with Milacron as the surviving corporation.

“Escrow Merger Certificate” means the Certificate of Ownership and Merger with respect to the Escrow Merger, filed with the Secretary of State of Delaware upon consummation of the Escrow Merger.

“Escrow Period” means that period beginning on the date of the indenture and ending on the date on which the funds held in the Escrow Account are released upon satisfaction of all conditions precedent to such release.

“Eurobonds” means the 7.625% Guaranteed Fixed Rate Bonds due 2005 of Milacron Capital Holdings B.V. in the original aggregate principal amount of € 115.0 million.

“Eurobond Escrow Account” means a segregated account under the sole control of the collateral agent, if any, that includes only cash, the proceeds thereof and interest earned thereon.

“Excess Collateral Proceeds” has the meaning set forth under the caption “— Repurchase at the Option of Holders — Asset Sales.”

“Excess Proceeds” has the meaning set forth under the caption “— Repurchase at the Option of Holders — Asset Sales.”


	(1) any lease of premises used only as office space or to warehouse inventory;

	(2) any lease, license, permit, franchise, power, authority or right if, to the extent that and for as long as (a) the grant of a security interest therein constitutes or would result in the abandonment,


	invalidation or unenforceability of such lease, license, permit, franchise, power, authority or right or the termination of, breach of or a default under the lease, instrument or agreement by which such lease, license, permit, franchise, power, authority or right is governed and (b) such abandonment, invalidation, unenforceability, breach, termination or default is not rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the New York UCC (or any successor provision) of any relevant jurisdiction or any other applicable law (including the United States bankruptcy code) or principles of equity; provided, however, that (i) such lease, license, permit, franchise, power, authority or right will be an Excluded Asset only to the extent and for as long as the conditions set forth in clauses (a) and (b) in this definition are and remain satisfied and to the extent such assets otherwise constitute Collateral, will cease to be an Excluded Asset, and will become subject to the Senior Secured Note Lien, immediately and automatically at such time as such conditions cease to exist, including by reason of any waiver or consent under the applicable instrument or agreement, and (ii) the proceeds of any sale, lease or other disposition of any such lease, license, permit, franchise, power, authority or right that is or becomes an Excluded Asset shall not be an Excluded Asset and shall at all times be and remain subject to the Senior Secured Note Lien;

	(3) assets or property (a) located outside the United States (other than assets or property of a Canadian Restricted Subsidiary located in Canada) or (b) of any Canadian Restricted Subsidiary other than those of the type described in clauses (1) through (4) of the definition of Credit Facility Priority Collateral;

	(4) deposit accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of salaried employees;

	(5) deposit accounts held by Oak International, Inc. at Citizens Bank and Nickerson Machinery Chicago Inc. at Fleet National Bank;

	(6) any real property acquired after the date of the indenture with a fair market value of less than $750,000 in the case of a fee interest or with an annual rent of less than $100,000 in the case of a leasehold interest;

	(7) Capital Stock of any Subsidiary of the Company or any Guarantor formed under the laws of a jurisdiction other than the United States or any State of the United States or the District of Columbia (a “Foreign Stock Subsidiary”) in excess of 65% of the outstanding Capital Stock of such Foreign Stock Subsidiary;

	(8) Capital Stock of any non-wholly owned Foreign Stock Subsidiary to the extent that a grant of a Lien therein would conflict with the terms of any organizational document of, agreement governing investments in, or the law of the jurisdiction of formation of, such Foreign Stock Subsidiary;

	(9) Capital Stock of Milacron Plastics Machinery (Jiangyin) Co., LTD, D-M-E-(Hong Kong) Limited, Japan D-M-E Corporation, Ferromatix India Limited and any Immaterial Subsidiary;

	(10) real estate located at 3025 Disney Street, Cincinnati, Ohio 45209 and real estate located at 10501 High M52, Manchester, Michigan 48158;

	(11) assets or property of Milacron Capital Holdings B.V.; and

	(12) (a) other personal property (other than deposit accounts, letter of credit rights, intellectual property and proceeds of Collateral) in which a security interest cannot be perfected by the filing of a financing statement under the Uniform Commercial Code or PPSA or similar Canadian legislation and (b) without duplication, motor vehicles, that have, in the aggregate for all such property and motor vehicles, a fair market value (as determined in good faith by the Company) not exceeding $1,000,000.

In addition, any Collateral consisting of any Capital Stock or other securities of any Subsidiary of the Company shall be limited at any time to that portion of such Capital Stock or other securities which value (defined as the principal amount, par value, book value as carried by the Company or market value, whichever is greatest), when considered in the aggregate with all other Capital Stock or other securities of such Subsidiary subject to a security interest under the indenture, does not exceed 19.99% of the principal amount

of the then outstanding notes issued, and the portion of any such Capital Stock or other securities of such Subsidiary in excess of such percentage will be deemed Excluded Assets; provided, however, in the event that Rule 3-16 of Regulation S-X promulgated by the SEC is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation or any other law, rule or regulation is adopted, which would require) the filing with the SEC (or any other governmental agency) of separate financial statements of any Subsidiary of the Company due to such Subsidiary’s Capital Stock or other securities securing the notes, then the Capital Stock or other securities of such Subsidiary (the “Excluded Securities”) shall automatically be deemed to be Excluded Assets, but only for so long as and to the extent necessary to not be subject to such requirement; provided further, however, that in such event, the security documents may be amended or modified, without the consent of any Holder of notes, to the extent necessary to release the security interests in the Excluded Securities that are deemed to constitute Excluded Assets.


	(1) the taking of any action to enforce or realize upon any Lien, including the institution of any foreclosure proceedings or the noticing of any public or private sale pursuant to Article 9 of the Code;

	(2) the exercise of any right or remedy provided to a secured creditor on account of a Lien under any of the Credit Facility Documents or Senior Secured Note Documents, under applicable law, in an insolvency or liquidation proceeding or otherwise, including the election to retain any of the Collateral in satisfaction of a Lien;

	(3) the taking of any action or the exercise of any right or remedy in respect of the collection on, set off against, marshaling of, or foreclosure on the Collateral or the proceeds thereof;

	(4) the appointment of a receiver, receiver and manager or interim receiver of all or part of the Collateral;

	(5) the sale, lease, license, or other disposition of all or any portion of the Collateral by private or public sale or any other means permissible under applicable law;

	(6) the exercise of any other right of a secured creditor under Part 6 of Article 9 of the Code;

	(7) the exercise of any voting rights relating to any Capital Stock included in the Collateral; and

	(8) the delivery of any notice, claim or demand relating to the Collateral to any Person (including any securities intermediary, depository bank or landlord) in possession or control of any Collateral.

For avoidance of doubt, filing a proof of claim in bankruptcy court or seeking adequate protection shall not be deemed to be an Exercise of Remedies.

“Existing Credit Facility” means the Amended and Restated Financing Agreement, dated as of March 31, 2004, among Milacron, certain subsidiaries of Milacron, as borrowers, certain subsidiaries of Milacron, as guarantors, the lenders from time to time party thereto and Credit Suisse First Boston, acting through its Cayman Islands Branch, as Administrative Agent and Collateral Agent.

“Existing Indebtedness” means Indebtedness of the Company and its Restricted Subsidiaries (other than Indebtedness under the Existing Credit Facility, the Series B Notes and the ABL Facility) in existence on the date of the indenture, until such amounts are repaid.

“Existing Preferred Stock” means Milacron’s 4% Cumulative Preferred Stock.

“Fixed Charge Coverage Ratio” means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such Person and its Restricted Subsidiaries for such period to the Fixed Charges of such Person and its Restricted Subsidiaries for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, Guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the “Calculation Date”), then the Fixed Charge Coverage Ratio will be calculated


	(1) acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers or consolidations and including any related financing transactions, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date will be given pro forma effect as if they had occurred on the first day of the four-quarter reference period and Consolidated Cash Flow for such reference period will be calculated on a pro forma basis in accordance with Regulation S-X under the Securities Act;

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

	(3) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, will be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its Restricted Subsidiaries following the Calculation Date;

	(4) any Person that is a Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four-quarter period;

	(5) any Person that is not a Restricted Subsidiary on the Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four-quarter period; and

	(6) if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will 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 Obligation applicable to such Indebtedness if such Hedging Obligation has a remaining term as at the Calculation Date in excess of 12 months).

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


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

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

	(3) any interest expense on Indebtedness of another Person that is Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon; plus

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

“Foreign Borrowing Base” means, as of any date, an amount equal to 80% of the book value of all accounts receivable owned by Foreign Restricted Subsidiaries of the Company; provided, however, that any accounts receivable owned by a Receivables Subsidiary, or which the Company or any of its Restricted Subsidiaries has agreed to transfer to a Receivables Subsidiary, will be excluded for purposes of determining such amount.

“Foreign Credit Facility” means, with respect to any Foreign Restricted Subsidiary, one or more working capital debt facilities, in each case with banks or other institutional lenders providing for revolving credit loans and letters of credit, in each case as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part, and without limitation as to amount, terms, conditions, covenants and other provisions) from time to time.

“Foreign Receivables Subsidiary” means any Receivables Subsidiary that is not a Domestic Receivables Subsidiary.

“Foreign Restricted Subsidiaries” means those Restricted Subsidiaries that are not Domestic Restricted Subsidiaries or Canadian Restricted Subsidiaries.

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, as in effect on the date of the indenture.

“Global Notes” has the meaning set forth under the caption “— Book-Entry, Delivery and Form.”

“Government Securities” means direct obligations of, or obligations guaranteed by, the United States of America for the payment of which guarantees or obligations the full faith and credit of the United States is pledged.

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


	(1) the Domestic Restricted Subsidiaries;

	(2) the Canadian Restricted Subsidiaries; and

	(3) any other Subsidiary that executes a Guarantee in accordance with the provisions of the indenture,

and their respective successors and assigns, in each case, until the Guarantee of such Person has been released in accordance with the provisions of the indenture.

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


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

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

“Immaterial Subsidiary” means, (a) as of any date, any Restricted Subsidiary whose total assets, as of that date, are less than $100,000 and whose total revenues for the most recent 12-month period do not exceed $100,000; provided that a Restricted Subsidiary will not be considered to be an Immaterial Subsidiary if it,

directly or indirectly, guarantees or otherwise provides direct credit support for any Indebtedness of the Company and (b) at any time prior to the expiration of the Escrow Period, Milacron Commercial Corp.; provided that Milacron Commercial Corp. will no longer constitute an Immaterial Subsidiary after the expiration of the Escrow Period unless at that time it meets the criteria of the preceding clause (a).

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


	(1) in respect of borrowed money;

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

	(3) in respect of banker’s acceptances;

	(4) representing Capital Lease Obligations;

	(5) representing the balance deferred and unpaid of the purchase price of any property or services, except any such balance that constitutes an accrued expense or trade payable; or

	(6) representing any Hedging Obligations,

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

In addition, for the purpose of avoiding duplication in calculating the outstanding principal amount of Indebtedness for purposes of the covenant described under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock,” Indebtedness arising solely by reason of the existence of a Lien to secure other Indebtedness permitted to be incurred under the covenant described under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock” will not be considered incremental Indebtedness.

Indebtedness shall not include the obligations of any Person (1) resulting solely from the endorsement of negotiable instruments for collection in the ordinary course of business or (2) resulting from post-closing payment adjustments to which the seller may become entitled in connection with the purchase by the Company or any Restricted Subsidiary of any business, to the extent such payment is determined by a final closing financial statement or such payment depends on the performance of such business after the closing; provided that at the time of closing, the amount of any such payment is not determinable and, to the extent such payment thereafter becomes fixed and determined, the amount is paid within 60 days thereafter.

“Indirect Participants” has the meaning set forth under the caption “— Book-Entry, Delivery and Form.”

“insolvency or liquidation proceeding” means: (1) any case, action or proceeding before any court or other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (2) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case covered by clauses (1) and (2) undertaken under the United States Federal, State or foreign law, including the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada) and the Companies’ Creditors Arrangement Act (Canada).

“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 (i) commission, travel and similar advances to officers and employees made in the ordinary course of business or (ii) receivables created or acquired in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet

prepared in accordance with GAAP. If the Company or any Restricted Subsidiary of the Company sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary of the Company, the Company will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Company’s Investments in such Restricted Subsidiary that were not sold or disposed of in an amount determined as provided in the final paragraph of the covenant described above under the caption “— Certain Covenants — Restricted Payments.” The acquisition by the Company or any Restricted Subsidiary of the Company of a Person that holds an Investment in a third Person will be deemed to be an Investment by the Company or such Restricted Subsidiary in such third Person in an amount equal to the portion of the fair market value (determined as provided in the final paragraph of the covenant described above under the caption “— Certain Covenants — Restricted Payments”) of the Investments held by the acquired Person in such third Person in proportion to the percentage of the aggregate Equity Interests of such acquired Person held by the Company or such Restricted Subsidiary. Except as otherwise provided for herein, the amount of an Investment will be its fair value at the time the Investment is made without giving effect to subsequent changes in value.

“Legal Defeasance” has the meaning set forth under the caption “— Legal Defeasance and Covenant Defeasance.”

“Lien” means, with respect to any asset, any mortgage, lien, pledge, hypothec, 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.

“Make-Whole Redemption Date” has the meaning set forth under the caption “— Optional Redemption.”

“Net Collateral Proceeds” means the aggregate cash proceeds and other consideration received by the Company or any of its Restricted Subsidiaries in respect of any Sale of Senior Secured Note Priority Collateral (including, without limitation, any cash received upon the sale or other disposition of any noncash consideration received in any such Sale of Senior Secured Note Priority Collateral, but only as and when received), net of (1) all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Sale of Senior Secured Note Priority Collateral, (2) the direct costs relating to such Sale of Senior Secured Note Priority Collateral, including, without limitation, legal, accounting and investment banking fees, sales commissions, recording fees, title transfer fees, appraiser fees, and any relocation expenses incurred as a result of such Sale of Senior Secured Note Priority Collateral, taxes paid or payable as a result of such Sale of Senior Secured Note Priority Collateral, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, (3) amounts required to be applied to the repayment of Indebtedness secured by a Permitted Prior Lien on the asset or assets that were the subject of such Sale of Senior Secured Note Priority Collateral, (4) expenses and fees in connection with obtaining any required consents to such Sale of Senior Secured Note Priority Collateral from lenders or holders of Indebtedness or other third parties (unless such expenses and fees consist of the repayment of Indebtedness to any such Person), and (5) any reserve for adjustment in respect of the sale price of such asset or assets or for retained liabilities in connection with such Sale of Senior Secured Note Priority Collateral established in accordance with GAAP.

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


	(1) any gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with: (a) any Asset Sale; or (b) the disposition of any securities by such Person or any of its


	Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and

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

“Net Proceeds” means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale (other than any Sale of Senior Secured Note Priority Collateral) (including, without limitation, any cash received upon the sale or other disposition of any noncash consideration received in any such Asset Sale, but only as and when received), net of (1) all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Asset Sale, (2) the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, sales commissions, recording fees, title transfer fees, appraiser fees, and any relocation expenses incurred as a result of such Asset Sale, taxes paid or payable as a result of such Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, (3) amounts required to be applied to the repayment of Indebtedness, other than Indebtedness under a Credit Facility, secured by a Lien on the asset or assets that were the subject of such Asset Sale, (4) expenses and fees in connection with obtaining any required consents to such Asset Sales from lenders or holders of Indebtedness or other third parties (unless such expenses and fees consist of the repayment of Indebtedness to any such Person), and (5) any reserve for adjustment in respect of the sale price of such asset or assets or for retained liabilities in connection with such Asset Sale established in accordance with GAAP.

“New York UCC” means the Uniform Commercial Code, as from time to time in effect in the State of New York.


	(1) as to which neither the Company nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender;

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

	(3) as to which the lenders have been notified in writing (which may be by the terms of the instrument evidencing such Indebtedness) that they will not have any recourse to the stock (other than the stock of an Unrestricted Subsidiary pledged by the Company or any of its Unrestricted Subsidiaries) or assets of the Company or any of its Restricted Subsidiaries.

“Note Purchase Agreement” means the Note Purchase Agreement with respect to the Series A Notes and the Series B Notes, dated as of March 12, 2004, among Milacron and Glencore and Mizuho, as amended on April 5, 2004.

“Obligations” means any principal (including reimbursement obligations with respect to letters of credit whether or not drawn), interest (including all interest accrued thereon after the commencement of any insolvency or liquidation proceeding at the rate, including any applicable post-default rate, even if such interest is not enforceable, allowable or allowed as a claim in such proceeding), premium (if any), fees, indemnifications, reimbursements, expenses and other liabilities payable under the documentation governing any Indebtedness, and in the case of the ABL Facility, all obligations thereunder.

“Obligor” means the Company, the Guarantors and each other Subsidiary of the Company that has granted to the collateral agent a Lien upon any of the Collateral as security for a Senior Secured Note Obligation.

“Participants” has the meaning set forth under the caption “— Book-Entry, Delivery and Form.”

“Payment Default” has the meaning set forth under the caption “— Events of Default and Remedies.”

“Permitted Asset” means property, plant and equipment used or to be used in the business of the Company or any of its Domestic Restricted Subsidiaries and which will be owned upon acquisition by the Company or a Domestic Restricted Subsidiary.

“Permitted Business” means any business similar in nature to any business conducted by the Company and its Restricted Subsidiaries on the date of the indenture and any business reasonably ancillary, incidental, complementary or related to, or a reasonable extension, development or expansion of, the business conducted by the Company and its Restricted Subsidiaries on the date of the indenture, in each case as determined by the Board of Directors of the Company.

“Permitted Debt” has the meaning set forth under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock.”


	(1) any controlling equity holder, majority-owned Subsidiary, or immediate family member (in the case of an individual) of either Mizuho or Glencore; and

	(2) any trust, corporation, partnership, limited liability company or other entity, the beneficiaries, stockholders, partners, members, owners or Persons beneficially holding a majority controlling interest of which consist of any one or more of Mizuho, Glencore and/or such Persons referred to in the immediately preceding clause (1).


	(1) any Investment in the Company or in a Restricted Subsidiary of the Company that is a Guarantor;

	(2) any Investment by the Company or a Guarantor in a Restricted Subsidiary of the Company that is not a Guarantor in an amount that, when taken together with all Investments outstanding under clause (5)(b) below, does exceed $15.0 million at any one time outstanding;

	(3) any Investment by a Restricted Subsidiary that is not a Guarantor in another Restricted Subsidiary that is not a Guarantor;

	(4) any Investment in Cash Equivalents;

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


	(a) such Person becomes a Restricted Subsidiary of the Company and a Guarantor or such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary of the Company that is a Guarantor;

	(b) if the Investment is made by the Company or a Guarantor, such Person becomes a Restricted Subsidiary of the Company that is not a Guarantor or such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, a Restricted Subsidiary of the Company that is not a Guarantor, so long as such Investment, when taken together with all Investments outstanding under clause (2) above, does exceed $15.0 million at any one time outstanding; or

	(c) if the Investment is made by a Restricted Subsidiary of the Company that is not a Guarantor, such Person becomes a Restricted Subsidiary of the Company or such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, a Restricted Subsidiary of the Company;


	(6) any Investment made as a result of the receipt of noncash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales”;

	(7) any Investment to the extent made in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Company;

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

	(9) Hedging Obligations;

	(10) loans and advances to employees made in the ordinary course of business in an amount not to exceed $1.0 million;

	(11) advances, loans or extensions of credit to customers or suppliers in the ordinary course of business by the Company or any of its Restricted Subsidiaries;

	(12) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent obligations of, and other disputes with, customers and suppliers arising in the ordinary course of business;

	(13) Investments in any Person to the extent such Investment existed on the date of the indenture and any Investment that replaces, refinances or refunds such an Investment, provided that the new Investment is in an amount that does not exceed that amount replaced, refinanced or refunded and is made in the same Person as the Investment replaced, refinanced or refunded;

	(14) Investments in prepaid expenses, negotiable instruments held for collection and lease, utility and workers’ compensation, performance and other similar deposits;

	(15) transactions (other than loans or advances to employees) pursuant to compensation, employee benefit or other indemnity arrangements with officers, directors and employees of Milacron or any of its Restricted Subsidiaries entered into in the ordinary course of business;

	(16) Investments consisting of noncash consideration received in the form of securities, notes or similar obligations in connection with dispositions of obsolete or worn out assets permitted pursuant to the indenture in an aggregate amount not to exceed $5.0 million;

	(17) the acquisition by a Receivables Subsidiary in connection with a Qualified Receivables Transaction of Equity Interests of a trust or other Person established by the Receivables Subsidiary to effect such Qualified Receivables Transaction; and any other Investment by the Company or a Restricted Subsidiary of the Company in a Receivables Subsidiary or any Investment by a Receivables Subsidiary in any other Person in connection with a Qualified Receivables Transaction; provided that such other Investment is in the form of a note or other instrument that the Receivables Subsidiary or other Person is required to repay as soon as practicable from available cash collections less amounts required to be established as reserves pursuant to contractual agreements with entities that are not Affiliates of the Company entered into as part of a Qualified Receivables Transaction; and

	(18) other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (18) since the date of the indenture/that are at the time outstanding not to exceed $20.0 million.


	(1) Liens on Collateral of the Company and any Restricted Subsidiary securing (a) Credit Facility Debt incurred under clause (1) of the second paragraph of the covenant entitled “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock,” (b) any Hedging Obligations that


	constitute Credit Facility Obligations and (c) other Credit Facility Obligations not constituting Credit Facility Debt;

	(2) Liens on the Escrow Account created pursuant to the escrow agreement securing, equally and ratably, the Senior Secured Note Obligations and Liens created pursuant to the security documents securing, equally and ratably, the Senior Secured Note Obligations with respect to up to $275.0 million aggregate principal amount of notes at any one time outstanding, together with all other Senior Secured Note Obligations;

	(3) Liens securing Indebtedness under Foreign Credit Facilities permitted by clause (2) of the second paragraph of the covenant entitled “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock” and related Hedging Obligations, in each case covering only the assets of Foreign Restricted Subsidiaries;

	(4) Liens (not securing Credit Facility Obligations) in favor of the Company or the Guarantors;

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

	(6) Liens on property existing at the time of acquisition of the property by the Company or any Subsidiary of the Company, provided that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any other assets;

	(7) Liens to secure the performance of bids, tenders, leases, contracts (other than the payment of money), statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business;

	(8) Liens to secure Indebtedness (including Capital Lease Obligations) permitted by clause (5) of the second paragraph of the covenant entitled “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock” covering only the assets acquired with such Indebtedness;

	(9) Liens (other than Credit Facility Liens and Senior Secured Note Liens) existing immediately after the expiration of the Escrow Period and consummation of the Escrow Merger;

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

	(11) Liens incurred, created or assumed in connection with the refinancing of any Indebtedness, Attributable Debt or other Obligations secured by any Liens permitted at any time to be incurred, created or assumed by the indenture; provided that


	(a) the new Lien shall be limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to such property or proceeds or distributions thereof); and

	(b) the Indebtedness secured by the new Lien is not increased to any amount greater that the sum of (x) the outstanding principal amount or, if greater, committed amount of the permitted refinancing Indebtedness and (y) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing;


	(12) Liens on assets of the Company or a Receivables Subsidiary incurred in connection with a Qualified Receivables Transaction;

	(13) landlords’, carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and for sums not yet delinquent or being contested in good faith;


	(14) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

	(15) Liens in favor of collecting or payor banks consisting of rights of set-off with respect to money or instruments of the Company or any of its Restricted Subsidiaries on deposit with or in possession of such bank and arising by operation of law;

	(16) judgment Liens in respect of judgments that do not constitute an Event of Default;

	(17) any interest or title of a lessor or sublessor in the property subject to any lease or sublease entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business and covering only the assets so leased (other than a Capital Lease Obligation or a lease entered into as part of a sale and leaseback transaction);

	(18) easements, rights of way, zoning and similar restrictions incurred in the ordinary course of business, which do not in the aggregate materially impair the value of the Company’s and its Restricted Subsidiaries’ property, when taken as a whole;

	(19) Liens constituting licenses of intellectual property in the ordinary course of business; and

	(20) Liens on assets of Unrestricted Subsidiaries that secure Non-Recourse Debt of Unrestricted Subsidiaries.

“Permitted Prior Liens” means (a) all Liens described in clauses (5), (6), (8), (9) or (13) of the definition of “Permitted Liens” or in clause (11) thereof in respect of Permitted Prior Liens and (b) any other Liens that are required by law or are not voluntarily granted and arise by operation of law to the extent entitled by law to priority over the security interests granted by the security documents.

“Permitted Refinancing Indebtedness” means any Indebtedness of the Company or any of its Restricted Subsidiaries issued to refinance Indebtedness of the Company or any of its Restricted Subsidiaries (other than intercompany Indebtedness); provided that:


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

	(2) such Permitted Refinancing Indebtedness has a final maturity date no earlier than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being Refinanced;

	(3) if the Indebtedness being Refinanced is subordinated in right of payment to the notes, such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the notes on terms at least as favorable to the Holders of notes as those contained in the documentation governing the Indebtedness being Refinanced;

	(4) if the Indebtedness being Refinanced is secured, the Liens securing such Permitted Refinancing Indebtedness do not extend to or cover any property or assets of the Company or any of its Subsidiaries not securing the Indebtedness so Refinanced (other than improvements or accessions to such property); and

	(5) such Indebtedness is incurred either by the Company, a Guarantor or by the Restricted Subsidiary who is the obligor on the Indebtedness being Refinanced.

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

“Qualified Counterparty” means, with respect to any Hedging Obligations or Obligations under Bank Product Agreements, any counterparty that, at the time the Hedging Obligation was incurred or the applicable Bank Product Agreement was entered into:


	(1) is a lender under a qualified Credit Facility or any Affiliate of such a lender; or

	(2) enters into an irrevocable written agreement to be bound by the provisions of the intercreditor agreement with respect to its liens on the Credit Facility Priority Collateral, and which, in each case, appoints the applicable Credit Facility Agent to act as its agent with respect to such liens on the Credit Facility Priority Collateral.

“Qualified Credit Facility” means any Credit Facility pursuant to which credit shall be extended only to the Company or one of its Restricted Subsidiaries and in respect of which the related Credit Facility Agent has become a party to the intercreditor agreement on behalf of the lenders under the Qualified Credit Facility in which it has agreed on behalf of such lenders and on its own behalf to be subject to such intercreditor agreement on the same terms and in the same capacity as the lenders and the Credit Facility Agent for the ABL Facility.

“Qualified Equity Issuance” means any primary public offering or private placement to any Person of Capital Stock of the Company.

“Qualified Receivables Transaction” means any transaction or series of transactions entered into by the Company or any of its Restricted Subsidiaries pursuant to which the Company or any of its Restricted Subsidiaries sells, conveys or otherwise transfers to (1) a Receivables Subsidiary (in the case of a transfer by the Company or any of its Restricted Subsidiaries) and (2) any other Person (in the case of a transfer by a Receivables Subsidiary), or grants a security interest in, any accounts receivable (whether now existing or arising in the future) of the Company or any of its Restricted Subsidiaries, and any assets related thereto including, without limitation, all collateral securing such accounts receivable, all contracts and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving accounts receivable.

“Receivables Subsidiary” means a Wholly Owned Restricted Subsidiary of the Company which engages in no activities other than in connection with the financing of accounts receivable and which is designated by the Board of Directors of the Company (as provided below) as a Receivables Subsidiary:


	(1) no portion of the Indebtedness or any other Obligations (contingent or otherwise) of which:


	(a) is guaranteed by the Company or any Restricted Subsidiary of the Company (excluding guarantees of Obligations (other than the principal of, and interest on, Indebtedness) pursuant to customary representations, warranties, covenants and indemnities in connection with a Qualified Receivables Transaction);

	(b) is recourse to or obligates the Company or any Restricted Subsidiary of the Company in any way other than pursuant to customary representations, warranties, covenants and indemnities in connection with a Qualified Receivables Transaction; or

	(c) subjects any property or asset of the Company or any Restricted Subsidiary of the Company (other than accounts receivable and related assets as provided in the definition of “Qualified Receivables Transaction”), directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to customary representations, warranties, covenants and indemnities in connection with a Qualified Receivables Transaction;

(2) with which neither the Company nor any Restricted Subsidiary of the Company has any material contract, agreement, arrangement or understanding other than on terms no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company, other than customary fees payable in connection with servicing accounts receivable; and


	(3) with which neither the Company nor any Restricted Subsidiary of the Company has any obligation to maintain or preserve such Restricted Subsidiary’s financial condition or cause such Restricted Subsidiary to achieve certain levels of operating results.

Any such designation by the Board of Directors of the Company will be evidenced to the trustee by filing with the trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation and an officers’ certificate certifying that such designation complied with the foregoing conditions.

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

“Restricted Payments” has the meaning set forth under the caption “— Certain Covenants — Restricted Payments.”

“Restricted Subsidiary” of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.

“Sale of Senior Secured Note Priority Collateral” means an Asset Sale to the extent involving assets, rights or other property that constitutes Senior Secured Note Priority Collateral under the security documents.

“security documents” means all security agreements, pledge agreements, collateral assignments, mortgages, collateral agency agreements, control agreements, deeds of trust or other grants or transfers for security executed and delivered by the Company or any other Obligor creating (or purporting to create) a Lien upon Collateral in favor of the collateral agent or a Credit Facility Agent, as applicable, in each case, as amended, modified, renewed, restated or replaced, in whole or in part, from time to time, in accordance with its terms.

“Senior Secured Note Documents” means the indenture, the notes, the Exchange Notes, the Guarantees and the security documents (other than any security documents that do not secure Senior Secured Note Obligations).

“Senior Secured Note Lien” means a Lien granted by a security document to the collateral agent upon any property of the Company or any other Obligor to secure Senior Secured Note Obligations.

“Senior Secured Note Obligations” means the notes (including all Exchange Notes therefor), the Guarantees and all other Obligations of any Obligor under the Senior Secured Note Documents.

“Senior Secured Note Priority Collateral” means all Collateral, other than the Credit Facility Priority Collateral.

“Series A Notes” means Milacron’s $30.0 million aggregate principal amount of 20% Secured Step-Up Series A Notes due 2007.

“Series B Notes” means Milacron’s $70.0 million aggregate principal amount of 20% Secured Step-Up Series B Notes due 2007.

“Series B Preferred Stock” means Milacron’s 6.0% Series B Convertible Preferred Stock to be issued as contemplated by the Note Purchase Agreement.

“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.

“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.


	(1) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and

	(2) any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).

“Successor Company” has the meaning set forth under the caption “— Certain Covenants — Merger, Consolidation or Sale of Assets.”

“Treasury Rate” means the yield to maturity at a time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) which has become publicly available at least two business days prior to the Make-Whole Redemption Date (or, if such Statistical Release is no longer published, any publicly available source with similar market data)) most nearly equal to the period from the Make-Whole Redemption Date to May 15, 2011, provided, however, that if the period from the Make-Whole Redemption Date to May 15, 2011 is not equal to the constant maturity of a United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the Make-Whole Redemption Date to May 15, 2011 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used.

“Unrestricted Subsidiary” means any Subsidiary of the Company that is designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a resolution of the Board of Directors of the Company, and any Subsidiary of an Unrestricted Subsidiary, but only to the extent that each such Subsidiary:


	(1) has no Indebtedness other than Non-Recourse Debt;

	(2) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company;

	(3) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results; and

	(4) has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any of its Restricted Subsidiaries.

Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will be evidenced to the trustee by delivering to the trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation and an officers’ certificate certifying that such designation complied with the preceding conditions and was permitted by the covenant described above under the caption “— Certain Covenants — Restricted Payments.” If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of the indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such date and, if such Indebtedness is not permitted to be incurred as of such date under the covenant described under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock,” the Company will be in default of such covenant. The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted

Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation will only be permitted if (1) such Indebtedness is permitted under the covenant described under the caption “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock,” calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period; and (2) no Default would be in existence following such designation.

“U.S. Dollar Equivalent” means, with respect to any monetary amount in a currency other than U.S. dollars, at any time for determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as published in The Wall Street Journal in the “Exchange Rates” column under the heading “Currency Trading” on the date two Business Days prior to such determination. Except as described under “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock”, whenever it is necessary to determine whether the Company has complied with any covenant in the indenture or a Default has occurred and an amount is expressed in a currency other than U.S. dollars, such amount will be treated as the U.S. Dollar Equivalent determined as of the date such amount is initially determined in such currency.

“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:


	(1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by

	(2) the then outstanding principal amount of such Indebtedness.

“Wholly Owned Restricted Subsidiary” of any specified Person means a Restricted Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) will at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person.

The following discussion is a summary of certain U.S. federal income tax consequences of the exchange offer to holders of original notes, but is not a complete analysis of all potential tax effects. The summary below is based upon the Internal Revenue Code of 1986, as amended (the “Code”), regulations of the Treasury Department, administrative rulings and pronouncements of the Internal Revenue Service and judicial decisions, all of which are subject to change, possibly with retroactive effect. This summary does not address all of the U.S. Federal income tax consequences that may be applicable to particular holders, including dealers in securities, financial institutions, insurance companies and tax-exempt organizations. In addition, this summary does not consider the effect of any foreign, state, local, gift, estate or other tax laws that may be applicable to a particular holder. This summary applies only to a holder that acquired original notes at original issue for cash and holds such original notes as a capital asset within the meaning of Section 1221 of the Code.

An exchange of original notes for exchange notes pursuant to the exchange offer will not be treated as a taxable exchange or other taxable event for U.S. federal income tax purposes. Accordingly, there will be no U.S. federal income tax consequences to holders who exchange their original notes for exchange notes in connection with the exchange offer and any such holder will have the same adjusted tax basis and holding period in the exchange notes as it had in the original notes immediately before the exchange. Likewise, because the original notes were issued with “original issue discount” (requiring holders to accrue such discount into income prior to the receipt of cash attributable to such income), such discount will carry over to the exchange notes.

The foregoing discussion of certain U.S. federal income tax considerations does not consider the facts and circumstances of any particular holder’s situation or status. Accordingly, each holder of original notes considering this exchange offer should consult its own tax advisor regarding the tax consequences of the exchange offer to it, including those under state, foreign and other tax laws.

Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for original notes where such original notes were acquired as a result of market-making activities or other trading activities. We have agreed that, for a period of not less than 180 days after the Expiration Date, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. In addition, until , 2004, all dealers effecting transactions in the exchange notes may be required to deliver a prospectus.

We will not receive any proceeds from any sale of exchange notes by broker-dealers. Exchange notes received by broker-dealers for their own account pursuant to the exchange offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the exchange notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer or the purchasers of any such exchange notes. Any broker-dealer that resells exchange notes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of such exchange notes may be deemed to be an “underwriter” within the meaning of the Securities Act and any profit on any such resale of exchange notes and any commission or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

For a period of 180 days after the Expiration Date, we will promptly send additional copies of this prospectus and any amendment or supplement to this prospectus to any broker-dealer that requests such documents in the letter of transmittal. We have agreed to pay all expenses incident to the exchange offer other than commissions or concessions of any brokers or dealers and will indemnify the holders of the notes (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act.

Certain legal matters with respect to the securities offered hereby will be passed upon for us by Cravath, Swaine & Moore LLP, New York, New York. In addition, specific legal matters with respect to Canadian law will be passed upon for us by Baker & McKenzie, Toronto, Ontario, Canada; with respect to Michigan law by Dykema Gossett PLLC, Detroit, Michigan; with respect to Minnesota law by Malkerson Gilliland Martin LLP, Minneapolis, Minnesota; with respect to Ohio law by Frost Brown Todd LLC, Cincinnati, Ohio; with respect to Illinois law by Foley & Lardner LLP, Chicago, Illinois; and with respect to Dutch law by Stibbe P.C., New York, New York.

The consolidated financial statements of the company for the years ended December 31, 2001, 2002 and 2003, included in this prospectus have been audited by Ernst & Young LLP independent auditors, as stated in their report appearing herein.

In the opinion of management, the accompanying unaudited Consolidated Condensed Financial Statements contain all adjustments, including only normal recurring adjustments except for the matters discussed in the notes captioned “Discontinued Operations,” “Refinancing Costs” and “Restructuring Costs,” necessary to present fairly the company’s financial position, results of operations and cash flows.

The Consolidated Condensed Balance Sheet at December 31, 2003 has been derived from the audited Consolidated Financial Statements at that date, but does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

The accounting policies followed by the company are set forth in the “Summary of Significant Accounting Policies” note to the Consolidated Financial Statements included in the company’s Annual Report on Form 10-K for the year ended December 31, 2003.

The company accounts for stock-based compensation, including stock options, under the provisions of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and the related interpretations. Because all stock options outstanding under the company’s 1997 Long-Term Incentive Plan and prior plans have exercise prices equal to the fair market value of the underlying common shares at the respective grant dates, no compensation expense is recognized in earnings. The table that follows illustrates on a pro forma basis the effect on net loss and loss per common share if the stock options granted from 1995 through 2003 had been accounted for based on their fair values as determined under the provisions of Statement of Financial Accounting Standards No. 123, “Accounting for Stock-Based Compensation.” There have been no additional stock options granted in 2004.

In the third quarter of 2002, the company announced a strategy of focusing its capital and resources on building its position as a premier supplier of plastics processing technologies and strengthening its worldwide industrial fluids business. In connection with this strategy, during 2002 the company sold the Valenite and Widia and Werkö metalcutting tools businesses that had been included in its former metalworking technologies segment and initiated plans for the sale of the round metalcutting tools and grinding wheels businesses. The disposition of the round metalcutting tools businesses was completed in the third quarter of 2003 in two separate transactions that resulted in a combined after-tax loss of $6.9 million. The grinding

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

wheels business was sold on April 30, 2004. The company had previously recorded an estimated loss of $4.2 million on the disposition of the grinding wheels business. The ultimate loss on the sale is not expected to vary materially from this amount.

The round metalcutting tools and grinding wheels businesses are reported as discontinued operations and the Consolidated Condensed Financial Statements for all prior periods have been adjusted to reflect this presentation. Operating results for these businesses included in discontinued operations are presented in the following table.

As reflected in the preceding table, allocated interest expense includes interest on borrowings secured by assets of the businesses sold and an allocated portion of other consolidated interest expense based on the ratio of net assets sold or to be sold to consolidated assets.

The major classes of assets and liabilities of the discontinued grinding wheels business in the Consolidated Condensed Balance Sheets as of March 31, 2004 and December 31, 2003 are as follows:

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

During the first quarter of 2004, the company charged to expense $6.4 million of refinancing costs incurred in pursuing various alternatives to the March 12, 2004 refinancing of approximately $200 million in debt and other obligations (see Refinancing Transactions). The company’s refinancing costs for the second quarter will be at least $1 million or as much as $15 million if the tender offer for the 7 5/8% Eurobonds due 2005 (see Long-Term Debt) and the issuance of any new debt are completed during the quarter. The additional second quarter costs would include the premium related to the tender offer for the Eurobonds as well as the write-off of financing fees related to the credit facility entered into with Credit Suisse First Boston on March 12, 2004.

During 2001, the company’s management approved a plan to integrate the operations of EOC and Reform, two businesses that were acquired earlier in that year, with the company’s existing European mold base and components business. The total cost of the integration was $11.0 million, of which $.5 million was charged to expense in the first quarter of 2003.

In November 2002, the company announced restructuring initiatives intended to improve operating efficiency and customer service. The first action involved the transfer of all manufacture of container blow molding machines and structural foam systems from the plant in Manchester, Michigan to the company’s more modern and efficient facility near Cincinnati, Ohio. The mold making operation has also been moved to a smaller location near Manchester. In another initiative, the manufacture of special mold bases for injection molding at the Monterey Park, California plant was phased out and transferred to various other facilities in North America. These additional actions are resulting in incremental restructuring costs of approximately $10.4 million, including $3.3 million in the first quarter of 2003. An additional $.9 million, principally to complete the move of the mold making operation, was expensed in the first quarter of 2004. The net cash cost of these initiatives will be approximately $5 million, the majority of which was spent in 2003, including $2.6 million in the first quarter. An additional $.8 million related to the mold operation move was spent in the first quarter of 2004.

Early in 2003, the company initiated a plan for the further restructuring of its European blow molding machinery operations at a cost of $4.0 million, of which $2.2 million was recorded in the first quarter of that year. The restructuring involved the discontinuation of the manufacture of certain product lines at the plant in Magenta, Italy and the elimination of approximately 35 positions. The cash cost of the restructuring will be approximately $.9 million, a large majority of which was spent in 2003 including $.2 million in the first quarter.

In the third quarter of 2003, the company announced additional restructuring initiatives that focus on further overhead cost reductions in each of its plastics technologies segments and at the corporate office. These actions, which involve the relocation of production, closure of sales offices, voluntary early retirement programs and general overhead reductions, have resulted in the elimination of approximately 300 positions worldwide. A total of $11.2 million was charged to expense in 2003 in connection with these initiatives and an additional $.7 million is expected to be expensed in 2004 including $.3 million in the first quarter. Cash costs are expected to be approximately $8 million, of which $3.4 million was spent in 2003. An additional $2.3 million was spent in the first quarter of 2004.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

The following table presents the components of the restructuring costs that are included in the Consolidated Condensed Statements of Operations for the first quarters of 2004 and 2003.

The status of the reserves for the initiatives discussed above is summarized in the following tables. The amounts included therein relate solely to continuing operations.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

The table that follows presents the components of pension expense and postretirement health care costs for the first quarters of 2004 and 2003.

The company expects to make contributions to the funded pension plan for certain U.S. employees of $3.1 million in 2004.

At December 31, 2003, the company had non-U.S. net operating loss carryforwards — principally in The Netherlands, Germany and Italy — totaling $190 million and related deferred tax assets of $61 million. Valuation allowances totaling $51 million had been provided with respect to these assets as of that date. Management believes that it is more likely than not that portions of the net operating loss carryforwards in these jurisdictions will be utilized. However, there is currently insufficient positive evidence in some non-U.S. jurisdictions — primarily Germany and Italy — to conclude that no valuation allowances are required.

At December 31, 2003, Milacron had a U.S. federal net operating loss carryforward of $63 million of which $17 million and $46 million expire in 2022 and 2023, respectively. Deferred tax assets related to this loss carryforward, as well as to federal tax credit carryforwards ($13 million) and additional state and local loss

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

carryforwards ($10 million), totaled $45 million. Additional deferred tax assets totaling approximately $117 million had also been provided for book deductions not currently deductible for tax purposes including the writedown of goodwill, postretirement health care benefit costs and accrued pension liabilities. The deductions for financial reporting purposes are expected to be deducted for income tax purposes in future periods at which time they will have the effect of decreasing taxable income or increasing the net operating loss carryforward. The latter will have the effect of extending the ultimate expiration beyond 2023.

The conversion of the Series A Notes into newly issued common stock and the exchange of such common stock and the Series B Notes for convertible preferred stock triggered an “ownership change” for U.S. federal income tax purposes (see Refinancing Transactions). As a consequence of this ownership change, the timing of the company’s utilization of tax loss carryforwards and other tax attributes will be substantially delayed. This delay will increase income tax expense and decrease available cash in future years.

Accounting principles generally accepted in the U.S. require that valuation allowances be established when it is more likely than not that all or a portion of recorded deferred tax assets will not be realized in the foreseeable future. The company reviews the need for new valuation allowances and the carrying amounts of previously recorded valuation allowances quarterly based on the relative amount of positive and negative evidence available at the time. Factors considered in these evaluations include management’s short-term and long-range operating plans, the current and future utilization of net operating loss carryforwards, the expected future reversal of recorded deferred tax liabilities and the availability of qualified tax planning strategies. Valuation allowances are then established or adjusted as appropriate. The resulting decreases or increases in valuation allowances serve to favorably or unfavorably affect the company’s provision for income taxes and effective tax rate.

At March 31, 2003, management concluded that no valuation allowances were currently required with respect to the company’s U.S. deferred tax assets. This conclusion was based on the availability of qualified tax planning strategies and the expectation that increased industrial production and capital spending in the U.S. plastics industry combined with the significant reductions in the company’s cost structure that have been achieved in recent years would result in improved operating results in relation to the losses incurred in 2001 and 2002.

At June 30, 2003, however, management concluded that a recovery in the plastics industry and the company’s return to profitability in the U.S. would be delayed longer than originally expected. As a result of these delays and the incremental costs of the restructuring initiatives announced in the third quarter of 2003 (see Restructuring Costs), the company incurred a cumulative operating loss in the U.S. for the three-year period ending December 31, 2003. In such situations, accounting principles generally accepted in the U.S. include a presumption that expectations of earnings in the future cannot be considered in assessing the need for valuation allowances. Accordingly, a tax provision of approximately $71 million was recorded in the second quarter of 2003 to establish valuation allowances with respect to a portion of the company’s U.S. deferred tax assets for which future income was previously assumed.

During the second half of 2003, U.S. deferred tax assets increased by approximately $18 million due to continued losses from operations and a goodwill impairment charge, the effects of which were partially offset by taxable income related to dividends from non-U.S. subsidiaries. Valuation allowances were also increased by $18 million. As of December 31, 2003, U.S. deferred tax assets net of deferred tax liabilities totaled $162 million and U.S. valuation allowances totaled $89 million. The company continued to rely on the availability of qualified tax planning strategies and tax carryforwards to conclude that valuation allowances are not required with respect to U.S. deferred tax assets totaling approximately $73 million at December 31, 2003.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

Management will continue to reassess its conclusions regarding the amount of valuation allowances that are required on a quarterly basis. Further delays in a recovery in the U.S., particularly in capital spending in the plastics industry, could result in changes in management’s estimates and the related assumptions and a requirement to record additional valuation allowances against the U.S. deferred tax assets. This could result in a further increase in income tax expense and a corresponding decrease in shareholders’ equity in the period of the change.

Because of the factors discussed above, the company was unable to record tax benefits with respect to its losses in the U.S. and certain other jurisdictions in the first quarter of 2004. However, results for the quarter include tax expense related to operations in profitable non-U.S. jurisdictions. This resulted in a first quarter provision for income taxes of $1.1 million despite a pretax loss of $14.9 million. In the first quarter of 2003, the effective tax benefit rate was 26%. This effective rate is less than the U.S. federal statutory rate adjusted for state and local income losses due to the establishment of valuation allowances related to losses in certain non-U.S. jurisdictions.

During all of 2003 and through March 12, 2004, the company maintained a receivables purchase agreement with a third-party financial institution. Under this arrangement, the company sold, on a revolving basis, an undivided percentage ownership interest in designated pools of accounts receivable. As existing receivables were collected, undivided interests in new eligible receivables were sold. Accounts that became 60 days past due were no longer eligible to be sold and the company was at risk for credit losses for which the company maintained a reserve for doubtful accounts sufficient to cover estimated expenses. At December 31, 2003, approximately $33 million of accounts receivable related to continuing operations had been sold under this arrangement. This amount is reported as a reduction of accounts receivable in the Consolidated Condensed Balance Sheet at that date. On March 12, 2004, all amounts received under the receivables purchase agreement were repaid using a portion of the proceeds of the refinancing transactions entered into on that date (see Refinancing Transactions). The effect was to increase the use of cash from operating activities for the first quarter of 2004 by $33 million.

Certain of the company’s non-U.S. subsidiaries also sell accounts receivable on an ongoing basis. In some cases, these sales are made with recourse, in which case appropriate reserves for potential losses are recorded at the sale date. At March 31, 2004 and December 31, 2003, the gross amounts of accounts receivable that had been sold under these arrangements totaled $7.2 million and $3.8 million, respectively. At March 31, 2004 and December 31, 2003, certain of these amounts were partially collateralized with $6 million and $3 million, respectively, of cash deposits that are included in cash and cash equivalents in the Consolidated Condensed Balance Sheet.

The company also periodically sells with recourse notes receivable arising from customer purchases of plastics processing machinery and, in a limited number of cases, guarantees the repayment of all or a portion of notes from its customers to third-party lenders. At March 31, 2004 and December 31, 2003, the company’s maximum exposure under these arrangements totaled $8.2 million and $11.6 million, respectively. In the event a customer were to fail to repay a note, the company would generally regain title to the machinery for later resale as used equipment.

Costs related to sales of notes receivable and to guarantees have not been material in the past.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

The carrying value of goodwill totaled $83.3 million and $83.8 million at March 31, 2004 and December 31, 2003, respectively. The company’s other intangible assets, which are included in other noncurrent assets in the Consolidated Condensed Balance Sheets, are not significant.

The components of other current assets and other noncurrent assets are shown in the tables that follow.

The components of accrued and other current liabilities are shown in the following table.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

The following table summarizes changes in the company’s warranty reserves. These reserves are included in accrued and other current liabilities in the Consolidated Condensed Balance Sheets.

The components of long-term accrued liabilities are shown in the following table.

On March 12, 2004, the company entered into a definitive agreement whereby Glencore Finance AG and Mizuho International plc purchased $100 million in aggregate principal amount of the company’s new exchangeable debt securities. The proceeds from this transaction, together with existing cash balances, were used to repay the 8 3/8% Notes due March 15, 2004. The securities the company issued were $30 million of 20% Secured Step-Up Series A Notes due 2007 and $70 million of 20% Secured Step-Up Series B Notes due 2007. On April 15, 2004, the $30 million of Series A Notes, which initially bore a combination of cash and pay-in-kind interest at a total rate of 20% per annum, were converted into 15.0 million shares of the company’s common stock at a conversion price of $2.00 per share. The $70 million of Series B Notes bore a combination of cash and pay-in-kind interest at a total rate of 20% per annum. The common stock into which the Series A Notes were converted and the Series B Notes were exchanged for a new series of the company’s convertible preferred stock with a cumulative cash dividend rate of 6% per annum (see Subsequent Events).

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

tax loss carryforwards and other tax attributes will be substantially delayed. This delay will increase income tax expense and decrease available cash in future years.

On March 12, 2004, the company also reached a separate agreement with Credit Suisse First Boston for a $140 million credit facility having a term of approximately one year. At closing, extensions of credit under the facility in an aggregate amount of $84 million were utilized to repay and terminate the company’s existing revolving credit facility and its existing receivables purchase program.

The credit facility consisted of a $65 million revolving A facility, with a $25 million subfacility for letters of credit, and a $75 million term loan B facility. The company and certain of its wholly-owned U.S. subsidiaries were joint and several borrowers under the credit facility, and the entire credit facility was secured by first priority liens, subject to permitted liens, on substantially all of the company’s assets and substantially all of the assets of the company’s U.S. subsidiaries and included pledges of stock of various wholly-owned U.S. subsidiaries and certain foreign subsidiaries.

Borrowings under the credit facility bore interest, at the company’s option, based upon either (i) a LIBOR rate plus the applicable margin (as defined below) or (ii) a reference rate plus the applicable margin (as defined below). The “applicable margin,” with respect to revolver A LIBOR loans, was 3.25% per annum, and with respect to revolver A reference rate loans, was 1.5% per annum. The “applicable margin,” with respect to term loan B LIBOR loans, was 10.5% per annum, and with respect to term loan B reference rate loans, was 8.00% per annum. In no event would the interest rate of (a) revolver A LIBOR loans have been less than 4.75% and (b) revolver A reference rate loans have been less than 5.5%. In no event would the interest rate of term loan B LIBOR loans or term loan B reference rate loans have been less than 12%.

On March 31, 2004, the financing agreement with Credit Suisse First Boston was amended and restated to clarify certain provisions and add Canadian collateral and borrowers.

On April 26, 2004, the company announced its intention to refinance the term loan B facility. On April 27, 2004, the company signed a commitment letter to replace the revolving A facility with a similar asset-based facility with a different lender. On June 10, 2004, the company replaced the revolving A facility with a new asset based facility and refinanced the term loan B facility (see Subsequent Events).

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

The components of short-term borrowings are shown in the table that follows. The terms of certain of these borrowing arrangements are described in detail in the note captioned “Refinancing Transactions.”

At March 31, 2004, $19.6 million of the revolving A facility was utilized including outstanding letters of credit of $12.1 million. Under the terms of the facility, the company’s additional borrowing capacity at March 31, 2004 was approximately $35 million after taking into account outstanding letters of credit and the minimum availability and existing reserve requirements.

The effective interest rates for borrowings under the revolving A facility and the term loan B facility were 4.75% and 12.0%, respectively. Both facilities include a number of positive and negative covenants with which the company was in compliance at March 31, 2004.

On April 26, 2004, the company announced its intention to refinance the term loan B facility. On April 27, 2004, the company signed a commitment letter to replace the revolving A facility with a similar asset-based facility with a different lender (see Refinancing Transactions). On June 10, 2004, the company replaced the revolving A facility with a new asset based facility and refinanced the term loan B facility (see Subsequent Events).

At March 31, 2004, the company had other lines of credit with various U.S. and non-U.S. banks totaling approximately $29 million. These credit facilities support the discounting of receivables, letters of credit, guarantees and leases in addition to providing borrowings under varying terms. Approximately $12 million was available to the company under these lines under certain circumstances.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

During 2003 and through March 12, 2004, the company had a committed revolving credit facility with certain U.S. and non-U.S. banks. At December 31, 2003, the gross amount of the facility was $65 million, of which $54 million was utilized including borrowings of $42 million and outstanding letters of credit of $12 million. On March 12, 2004, all amounts borrowed under the revolving credit facility were repaid using a portion of the proceeds of the refinancing transactions entered into on that date (see Refinancing Transactions).

On March 15, 2004, the 8 3/8% Notes were repaid using a portion of the proceeds of the refinancing transactions entered into on March 12, 2004 (see Refinancing Transactions).

On April 27, 2004, the company commenced a cash tender offer to repurchase all of the 7 5/8% Eurobonds due 2005 and on May 10, 2004, amended the terms of the offer. Under the amended terms and conditions of the tender offer, which were described in the supplemented offering materials, bondholders who validly tendered their Eurobonds and did not withdraw them received 104% of the principal amount of their tendered Eurobonds plus accrued interest to but not including the settlement date. The amended terms of the tender offer applied retroactively to holders who tendered their Eurobonds prior to the date of the amendment. €114,990,000 of the €115 million aggregate outstanding principal amount of the Eurobonds were purchased at the settlement of the tender offer on June 10, 2004 (see Subsequent Events).

In the first quarter of 2004, a total of 53,912 treasury shares were reissued in connection with contributions to employee benefit plans. This reduction in treasury shares was partially offset by the forfeiture of 47,946 restricted shares that were added to the treasury share balance in lieu of their cancellation.

On April 15, 2004, 4,607,088 treasury shares were reissued in connection with the conversion of the 20% Secured Step-Up Series A Notes due 2007 into 15.0 million common shares (see Refinancing Transactions).

In the first quarter of 2003, a total of 83,526 treasury shares were reissued in connection with grants of restricted shares and contributions to employee benefit plans. These reductions in treasury shares were partially offset by the cancellation of 66,543 restricted shares that had been granted in prior years.

As discussed fully in the note captioned “Refinancing Transactions,” on March 12, 2004, the company entered into a definitive agreement with Glencore Finance AG and Mizuho International plc that ultimately

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

significantly altered the company’s capitalization, including the issuance of a new series of convertible preferred stock (the Series B Preferred Stock) (see Subsequent Events). The Series B Preferred Stock is initially convertible, at the option of the holders, into 50.0 million shares of common stock at a conversion price of $2.00 per share and bears a cash dividend rate of 6% per year. The conversion price and dividend rate are subject to adjustment in certain circumstances including a provision that permits the payment of dividends in the form of additional shares of Series B Preferred Stock at a rate of 8% per year. In both cases, the number of common shares into which the Series B Preferred Stock is convertible would increase. To the extent not previously converted to common shares at the option of the holders, the Series B Preferred Stock must be converted to common shares on the seventh anniversary of the date of its issuance.

Total comprehensive income (loss) represents the net change in shareholders’ equity during a period from sources other than transactions with shareholders and, as such, includes net earnings or loss for the period. The components of total comprehensive loss are as follows:

The components of accumulated other comprehensive loss are shown in the following table.

The company is involved in remedial investigations and actions at various locations, including former plant facilities, and EPA Superfund sites where the company and other companies have been designated as potentially responsible parties. The company accrues remediation costs, on an undiscounted basis, when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated. Accruals for estimated losses from environmental remediation obligations are generally recognized no later than the completion of a remediation feasibility study. The accruals are adjusted as further information becomes available or circumstances change. Environmental costs have not been material in the past.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

Various lawsuits arising during the normal course of business are pending against the company and its consolidated subsidiaries. In several such lawsuits, some of which seek substantial dollar amounts, multiple plaintiffs allege personal injury involving products, including metalworking fluids, supplied and/or managed by the company. The company is vigorously defending these claims and believes it has reserves, indemnity claims against another party and insurance coverage sufficient to cover potential exposures.

While, in the opinion of management, the liability resulting from these matters will not have a significant effect on the company’s consolidated financial position or results of operations, the outcome of individual matters cannot be predicted with reasonable certainty at this time.

The company has four business segments: machinery technologies — North America, machinery technologies — Europe, mold technologies and industrial fluids. Descriptions of the products and services of these business segments are included in the “Organization” note to the Consolidated Financial Statements included in the company’s Annual Report on Form 10-K for the year ended December 31, 2003. Operating results by segment for the first quarters of 2004 and 2003 are presented in the following tables.

Consistent with the company’s internal reporting methods, segment operating profit or loss excludes restructuring costs and certain unallocated corporate and financing expenses.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

Basic earnings per common share data are based on the weighted-average number of common shares outstanding during the respective periods. In both 2004 and 2003, weighted-average shares assuming dilution excludes the effects of convertible debt and potentially dilutive restricted shares because their inclusion would result in a smaller loss per common share.

On April 15, 2004, the holders of $30 million of 20% Secured Step-Up Series A Notes due 2007 exercised their option to convert these obligations into 15.0 million common shares of the company (see Refinancing Transactions and Shareholders’ Equity).

On April 30, 2004, the company completed the sale of its grinding wheels business (see Discontinued Operations).

On May 26, 2004, Milacron Escrow Corporation, a wholly owned, direct subsidiary of the company created solely to issue notes and to merge with and into the company, issued $225,000,000 in aggregate principal amount of 11 1/2% Senior Secured Notes in a private placement. The proceeds of this issuance were initially placed in escrow.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS — (Unaudited) — (Continued)

On June 10, 2004, the conditions for release of the proceeds of the offering of Senior Secured Notes were satisfied, including the consummation of the merger of Milacron Escrow Corporation with and into the company.

On June 10, 2004, the company entered into an agreement for a new $75 million asset based revolving credit facility with JPMorgan Chase Bank as administrative agent and collateral agent.

On June 10, 2004, the company applied the proceeds of the offering of the Senior Secured Notes, together with $7.3 million in borrowings under the asset based facility and approximately $10.3 million of cash on hand, to:


	•	purchase €114,990,000 of the €115 million aggregate outstanding principal amount of Milacron Capital Holdings B.V.’s 7 5/8% Guaranteed Bonds due in April 2005 at the settlement of a tender offer therefor;

	•	terminate and repay $19 million in amounts outstanding under the revolving A facility (the company also used $17.4 million of availability under the asset based facility to replace or provide credit support for the outstanding letters of credit under the revolving A facility);

	•	repay the $75 million term loan B facility; and

	•	pay transaction expenses.

On May 26, 2004, 11 1/2% Senior Secured Notes due 2011 were issued by Milacron Escrow Corporation, a wholly-owned, direct subsidiary of Milacron Inc. created solely to issue the Senior Secured Notes and to merge with and into Milacron Inc. The merger of Milacron Escrow Corporation with and into Milacron Inc. was completed on June 10, 2004. Also on June 10, 2004, the Senior Secured Notes were jointly, severally, fully and unconditionally guaranteed by the company’s U.S. and Canadian restricted subsidiaries and by Milacron Capital Holdings B.V. Following are unaudited condensed consolidating financial statements of the company, including the guarantors. This information is provided pursuant to Rule 3-10 of Regulation S-X in lieu of separate financial statements of each subsidiary guaranteeing the Senior Secured Notes. The following condensed consolidating financial statements present the balance sheet, statement of operations and cash flows of (i) Milacron Inc. (in each case, reflecting investments in its consolidated subsidiaries under the equity method of accounting), (ii) the guarantor subsidiaries of Milacron Inc., (iii) the nonguarantor subsidiaries of Milacron Inc., and (iv) the eliminations necessary to arrive at the information for the company on a consolidated basis. The condensed consolidating financial statements should be read in conjunction with the accompanying unaudited consolidated condensed financial statements of the company.

We have audited the accompanying Consolidated Balance Sheets of Milacron Inc. and subsidiaries as of December 31, 2003 and 2002, and the related Consolidated Statements of Operations, Comprehensive Income and Shareholders’ Equity (Deficit), and Cash Flows for each of the three years in the period ended December 31, 2003. Our audits also included the financial statement schedule listed in the Index at Item 21(b). These financial statements and schedule are the responsibility of the company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Since the completion date of our audit of the accompanying financial statements and initial issuance of our report thereon dated February 10, 2004, except for the “Subsequent Events” note, as to which the date was March 12, 2004, which report contained an explanatory paragraph regarding the company’s ability to continue as a going concern, the company, as discussed in the “Subsequent Events” note, has obtained shareholder approval to convert certain debt to equity securities as required under the March 12, 2004 refinancing agreements. Therefore, the condition that raised substantial doubt about whether the Company will continue as a going concern no longer exists.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Milacron Inc. and subsidiaries at December 31, 2003 and 2002, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2003, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed under the heading “Change in Method of Accounting” in the notes to the consolidated financial statements, in 2002, the company changed its method of accounting for goodwill and other intangible assets.

February 10, 2004, except for the “Subsequent Events” note, as to which the date is June 10, 2004

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

The Consolidated Financial Statements include the accounts of the company and its subsidiaries. All significant intercompany transactions are eliminated.

Assets and liabilities of the company’s non-U.S. operations are translated into U.S. dollars at period-end exchange rates. Net exchange gains or losses resulting from such translation are excluded from net earnings and accumulated in a separate component of shareholders’ equity. Income and expense accounts are translated at weighted-average exchange rates for the period. Gains and losses from foreign currency transactions are included in other expense-net in the Consolidated Statements of Operations and are not material in any year presented.

The company recognizes sales revenue when products are shipped to unaffiliated customers, legal title has passed and all significant contractual obligations of the company have been satisfied. The company provides for estimated post-sale warranty costs as revenue is recognized (see Summary of Significant Accounting Policies — Warranty Reserves). Appropriate provisions are also made for returns for credit and uncollectible accounts.

Advertising costs are charged to expense as incurred. Excluding amounts related to participation in trade shows, advertising costs totaled $5.4 million in 2003, $4.8 million in 2002 and $6.9 million in 2001.

The company provides deferred income taxes for cumulative temporary differences between the financial reporting basis and income tax basis of its assets and liabilities. Provisions are made for all currently payable federal and state and local income taxes at applicable tax rates. Provisions are also made for any additional taxes on anticipated distributions from subsidiaries.

Basic earnings per common share data are based on the weighted-average number of common shares outstanding during the respective periods. Diluted earnings per common share data are based on the weighted-average number of common shares outstanding adjusted to include the effects of potentially dilutive stock options and certain restricted shares.

The company considers all highly liquid investments with a maturity of three months or less to be cash equivalents.

Inventories are stated at the lower of cost or market, including provisions for obsolescence commensurate with known or estimated exposures. The principal methods of determining costs are last-in, first-out (LIFO) for certain U.S. inventories and average or standard cost, which approximates first-in, first-out (FIFO), for other inventories.

Property, plant and equipment, including amounts related to capital leases, are stated at cost or, for assets acquired through business combinations, at fair value at the dates of the respective acquisitions. For financial reporting purposes, depreciation is generally determined on the straight-line method using estimated useful lives of the assets. Depreciation expense related to continuing operations was $20.3 million, $22.0 million and $23.7 million for 2003, 2002 and 2001, respectively.

Property, plant and equipment that are idle and held for sale are valued at the lower of historical cost less accumulated depreciation or fair value less cost to sell. Carrying costs through the expected disposal dates of such assets are accrued at the time expected losses are recognized. For assets expected to be sold at a gain, carrying costs are charged to expense as incurred.

In 2001 and prior years, goodwill, which represents the excess of acquisition cost over the fair value of net assets acquired in business combinations, was amortized on the straight-line method over periods ranging from 10 to 40 years. Amortization expense charged to earnings from continuing operations amounted to $10.8 million in 2001. Beginning in 2002, goodwill is no longer amortized but rather is reviewed annually for impairment. The company has elected to conduct its annual impairment reviews as of October 1 of each year and base its assessments of possible impairment on the discounted present value of the operating cash flows of its various reporting units (See Summary of Significant Accounting Policies — Change in Method of Accounting and Goodwill Impairment Charge).

The company evaluates its long-lived assets for impairment annually or when facts and circumstances suggest that the carrying amounts of these assets might not be recoverable. Beginning in 2002, goodwill is excluded from these reviews and is tested for impairment on a stand-alone basis.

The company maintains warranty reserves intended to cover future costs associated with its warranty obligations. These reserves are based on estimates of the amounts of those costs. Warranty costs are classified into two groups — normal and extraordinary. Normal warranty costs represent repair costs incurred in the ordinary course of business and reserves are calculated using a percentage of sales approach consistent with past experience. Extraordinary warranty costs are unique major problems associated with a single machine, customer order, or a set of problems related to a large number of machines. Extraordinary warranty reserves are estimated based on specific facts and circumstances. The company’s policy is to adjust its warranty reserves quarterly.

The company maintains various defined benefit and defined contribution pension plans covering substantially all U.S. employees and certain non-U.S. employees. For defined benefit plans, pension benefits are based primarily on length of service and compensation. The company’s policy is to fund the plans in

accordance with applicable laws and regulations. The company also sponsors a defined benefit postretirement health care plan under which such benefits are provided to certain U.S. employees.

The benefit obligations related to defined benefit pension plans and the postretirement health care plan are actuarially valued as of January 1 of each year. The amounts so determined are then progressed to year end based on known or expected changes. The assets of the funded defined benefit pension plan for certain U.S. employees are valued as of December 31 of each year.

The company accounts for stock-based compensation, including stock options, under the provisions of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and the related interpretations. Because all stock options outstanding under the company’s 1997 Long-Term Incentive Plan and predecessor plans have exercise prices equal to the fair market value of the underlying common shares at the respective grant dates, no compensation expense is recognized in earnings. The following table illustrates on a pro forma basis the effect on net loss and loss per common share if the stock options granted from 1995 through 2003 had been accounted for based on their fair values as determined under the provisions of Statement of Financial Accounting Standards No. 123, “Accounting for Stock-Based Compensation.”

Additional information regarding stock options and expense related to restricted shares granted under the 1997 Long-Term Incentive Plan is included in the note captioned “Stock-Based Compensation.”

The company enters into foreign currency forward exchange contracts, which are a type of derivative financial instrument, on an ongoing basis commensurate with known or expected exposures. The purpose of this practice is to minimize the potentially adverse effects of foreign currency exchange rate fluctuations on the company’s operating results. The company does not currently hold other types of derivative financial instruments and does not engage in speculation.

Effective January 1, 2002, the company adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets.” As required by this standard, during 2002 the company completed the transitional reviews of recorded goodwill balances as of January 1, 2002. These transitional reviews resulted in a pretax goodwill impairment charge of $247.5 million ($187.7 million after tax or $5.61 per share) that was recorded as the cumulative effect of a change in method of accounting as of January 1, 2002.

Approximately 75% of the pretax charge related to the company’s Uniloy and round metalcutting tools businesses, the latter of which was sold in 2003.

In 2002, the company announced a strategy of focusing its capital and resources on building its position as a premier supplier of plastics processing technologies and strengthening its worldwide industrial fluids business. In connection with this strategy, during 2002 the company sold two businesses that were included in its former metalworking technologies segment and initiated efforts to seek strategic alternatives for two other businesses of the segment.

On August 30, 2002, the company completed the sale of its Widia and Werkö metalcutting tools businesses to Kennametal, Inc. for €188 million in cash (approximately $185 million), subject to post-closing adjustments. In a separate but contingent transaction, the company purchased an additional 26% of the shares of Widia India, thereby increasing its ownership interest from 51% to 77%. The entire 77% of the Widia India shares was included in the sale transaction. After deducting post-closing adjustments that were paid in the first quarter of 2003, transaction costs and the cost to increase the company’s ownership interest in Widia India, the ultimate net cash proceeds from the sale were approximately $135 million, most of which was used to repay bank borrowings. The sale resulted in a 2002 after-tax loss of $14.9 million that was subsequently adjusted to $14.0 million in 2003. Approximately $7 million of the loss resulted from the recognition of the cumulative foreign currency translation adjustments that had been recorded in accumulated other comprehensive loss since the acquisition of Widia in 1995.

On August 9, 2002, the company completed the sale of its Valenite metalcutting tools business to Sandvik AB for $175 million in cash. After deducting post-closing adjustments that were paid in the first quarter of 2003, transaction costs and sale-related expenses, the net cash proceeds from the sale were approximately $145 million, a majority of which was used to repay bank borrowings. The company recorded an after-tax gain on the sale of $31.3 million in 2002. The amount of the gain was adjusted to $31.7 million in 2003.

During the third quarter of 2002, the company retained advisors to explore strategic alternatives for its round metalcutting tools and grinding wheels businesses and in the fourth quarter, initiated plans for their sale. The disposition of the round metalcutting tools business was completed in the third quarter of 2003 in two separate transactions. In the fourth quarter of 2002, the company had recorded an estimated loss on the sale of this business of $4.7 million which was increased to $6.9 million in 2003 based on the actual sales proceeds and transaction-related expenses. The sale of the grinding wheels business is expected to be completed early in 2004. In the fourth quarter of 2002, the company recorded an estimated loss on the sale of this business of $5.2 million. Based on revised expectations regarding the value of the assets to be sold and the sale-related costs and expenses, the estimated loss was reduced to $4.2 million in the fourth quarter of 2003.

All of the businesses discussed above are reported as discontinued operations and the Consolidated Financial Statements for all prior periods have been adjusted to reflect this presentation. Operating results for all of the businesses included in discontinued operations are presented in the following table.

As reflected in the preceding table, allocated interest expense includes interest on debt assumed by the respective buyers, interest on borrowings that were required to be repaid using a portion of the proceeds from the Widia and Werkö transaction and the Valenite transaction, interest on borrowings secured by assets of the businesses sold and an allocated portion of other consolidated interest expense based on the ratio of net assets sold or to be sold to consolidated assets.

As presented in the Consolidated Statements of Operations for 2003 and 2002, the line captioned “Net gain (loss) on divestitures” includes the following components.

The major classes of assets and liabilities of discontinued operations in the Consolidated Balance Sheets as of December 31, 2003 and December 31, 2002 are as follows:

In 2003, the company recorded a goodwill impairment charge of $65.6 million (with no tax benefit) to adjust the carrying value of the goodwill of two businesses included in the mold technologies segment. The charge resulted from a downward adjustment of the future cash flows expected to be generated by these businesses due to the delay in the general economic recovery both in North America and Europe. The largest decrease in cash flow expectations related to the company’s European mold base and components business due to continued weakness in the markets it serves.

In 2002, the company recorded an impairment charge of $1.0 million (with no tax benefit) related to a small business that is also included in the mold technologies segment.

The amounts of the charges recorded in 2003 and 2002 were determined based on a comparison of the present value of expected future cash flows to the historical carrying values of the businesses’ assets (including goodwill) and liabilities.

In 2001, the company’s management formally approved plans to consolidate certain manufacturing operations and reduce its cost structure. Implementation of these plans resulted in pretax charges to earnings from continuing operations of $17.8 million. Of the total cost of the plans, $14.1 million was recorded in 2001. An additional $3.7 million was charged to expense in continuing operations during 2002. The 2001 plans involved the closure of four manufacturing facilities in North America and the elimination of several sales and administrative locations worldwide. The consolidations and overhead reductions resulted in the elimination of approximately 450 manufacturing and administrative positions within the company’s continuing operations, principally in the U.S. and Europe. The cash cost of implementing the plans related to continuing operations was $12.5 million. Of the total cash cost, $5.8 million was spent in 2001, $5.4 million in 2002 and $1.3 million in 2003.

During 2001, the company’s management also approved a plan to integrate the operations of EOC and Reform (see Acquisitions) with the company’s existing European mold base and components business. The total cost of the integration was $11.0 million, of which $1.2 million was included in reserves for employee termination benefits and facility exit costs that were established in the allocations of the EOC and Reform acquisition costs. The remainder was charged to expense, including $3.4 million in 2001, $4.6 million in 2002 and $1.8 million in 2003. As approved by management, the plan involved the consolidation of the manufacturing operations of five facilities located in Germany and Belgium into three facilities, the reorganization of warehousing and distribution activities in Europe, and the elimination of approximately 230 manufacturing and administrative positions. The total cash cost of the integration was $9.0 million, of which $1.0 million was spent in 2001, $7.8 million in 2002 and $.2 million in 2003.

In the third quarter of 2002, the company’s management approved additional restructuring plans for the purpose of further reducing the company’s cost structure in certain businesses and to reduce corporate costs as a result of the disposition of Widia, Werkö and Valenite. These actions resulted in 2002 restructuring expense of $1.3 million and cash costs of $.3 million in 2002 and $.2 million in 2003.

In November 2002, the company announced additional restructuring initiatives intended to improve operating efficiency and customer service. The first action involved the transfer of all manufacturing of container blow molding machines and structural foam systems from the plant in Manchester, Michigan to the company’s more modern and efficient facility near Cincinnati, Ohio. The mold making operation has also been moved to a smaller location near Manchester. In the second initiative, the manufacture of special mold bases for injection molding at the Monterey Park, California plant was phased out and transferred to various other facilities in North America. These additional actions are expected to result in incremental restructuring costs of approximately $9.8 million. Of the total cost of the actions, $4.3 million and $4.4 million was charged to expense in 2002 and 2003, respectively. An additional $1.1 million of expense is expected to be recorded in 2004, principally to complete the relocation of the mold making operation. The total cash cost of these initiatives is expected to be approximately $4.1 million, a majority of which was spent in 2003. The pretax annualized cost savings are expected to exceed $5 million, most of which was realized in 2003.

Early in 2003, the company initiated a plan for the further restructuring of its European blow molding machinery operations at a cost of $4.0 million. The restructuring involved the discontinuation of the manufacture of certain product lines at the plant in Magenta, Italy and the elimination of approximately 35 positions. The cash cost of the restructuring — the majority of which was spent in 2003 — will be approximately $.9 million. The annualized pretax savings are expected to be approximately $2 million, which began to be realized in the first quarter of 2003.

In the second quarter of 2003, the company initiated a plan to close its special mold base machining operation in Mahlberg, Germany and relocate a portion of its manufacturing to another location. Certain other production was outsourced. The closure resulted in restructuring costs of $5.7 million and the elimination of approximately 65 positions. Cash costs were $2.8 million and the annual cost savings are expected to be almost $4 million.

In the third quarter of 2003, the company announced additional restructuring initiatives that focus on further overhead cost reductions in each of its plastics technologies segments and at the corporate office. These actions, which involve the relocation of production, closure of sales offices, voluntary early retirement programs and general overhead reductions, are expected to result in the elimination of more than 300 positions worldwide at a cost of $11.2 million, all of which was recorded in 2003. Cash costs related to these initiatives will be approximately $7 to $8 million, of which $3.4 million was spent in 2003. The annual cost savings are expected to be approximately $20 million.

The following table presents the components of the line captioned “Restructuring costs” in the Consolidated Statements of Operations for the years 2003, 2002 and 2001.

The status of the reserves for the initiatives discussed above is summarized in the following tables. The amounts included therein relate solely to continuing operations. To the extent that any unused reserves that were established in the allocation of acquisition cost remain after the completion of the EOC and Reform integrations, those amounts will be applied as reductions of the goodwill arising from the respective acquisitions.

In the second quarter of 2001, the company acquired Reform Flachstahl (Reform) and EOC Normalien (EOC), two businesses headquartered in Germany that manufacture and distribute mold bases and components for plastics injection molding. The company also acquired Progress Precision, a Canadian manufacturer of barrels and screws and provider of related services for plastics extrusion, injection molding and blow molding. The combined annual sales of the three businesses as of their respective acquisition dates were approximately $53 million.

In February 2002, the company acquired the remaining 74% of the outstanding shares of Ferromatik Milacron A/ S, which sells and services Ferromatik injection molding machines in Denmark. Ferromatik Milacron A/ S, which has annual sales of approximately $4 million, was previously accounted for on the equity method but is now fully consolidated beginning in 2002.

In the first quarter of 2003, the company purchased the remaining 51% of the shares of Klockner Ferromatik AG, a Ferromatik sales office in Switzerland with annual sales of approximately $6 million. In addition, the company acquired the remaining 25% of 450500 Ontario Limited, a consolidated subsidiary that manufactures components for molds used in injection molding.

Progress Precision is included in the machinery technologies — North America segment while Reform, EOC and 450500 Ontario Limited are included in the mold technologies segment. Ferromatik Milacron A/ S and Klockner Ferromatik AG are included in machinery technologies — Europe.

All of the acquisitions were accounted for under the purchase method and were financed through the use of available cash and bank borrowings. The aggregate cost of the acquisitions, including professional fees and other related costs, totaled $1.1 million in 2003, $.9 million in 2002 and $32.1 million in 2001. The allocation of the aggregate cost of the acquisitions to the assets acquired and liabilities assumed is presented in the table that follows. The amounts for 2003 relate solely to Klockner Ferromatik AG.

Unaudited pro forma sales and earnings information is not presented because the amounts would not vary materially from the comparable amounts reflected in the company’s historical Consolidated Statements of Operations for any year.

Charges to operations for the research and development activities of continuing operations are summarized below.

Pension cost for all defined benefit plans is summarized in the following table. For all years presented, the table includes amounts for plans for certain employees in the U.S. and Germany.

$1.8 million is included in results of discontinued operations. In 2001, $.5 million is included in restructuring costs.

The following table summarizes changes in the projected benefit obligation for all defined benefit plans.

The following table summarizes the changes in plan assets for the U.S. plans. Consistent with customary practice in Germany, the plan for employees in that country has not been funded.

The weighted allocations of plan assets at December 31, 2003 and 2002 are shown in the following table.

At December 31, 2003 and 2002, common shares of the company represented 4% and 6% of the plan’s equity securities. These common shares had a market value of $9.2 million at December 31, 2003 and $12.0 million at December 31, 2002.

At December 31, 2003, the company’s target allocation percentages for plan assets were approximately 60% to 65% equity securities and 35% to 40% debt securities. The targets may be adjusted periodically to reflect current market conditions and trends as well as inflation levels, interest rates and the trend thereof, and economic and monetary policy. The objective underlying this allocation is to achieve a long-term rate of return of inflation plus 6%. Under the current policy, the investment in equity securities may not be less than 35% or more than 80% of total assets. Investments in debt securities may not be less than 20% or more than 65% of total assets.

The expected long-term rates of return on plan assets for purposes of determining pension expense were 9.0% in 2003 and 9.5% in 2002 and 2001. The company will continue to use a 9.0% rate in 2004. Expected rates of return are developed based on the target allocation of debt and equity securities and on the historical returns on these types of investments judgmentally adjusted to reflect current expectations of future returns and value-added expectations based on historical experience of the plan’s investment managers. In evaluating future returns on equity securities, the existing portfolio is stratified to separately consider large and small capitalization investments as well as international and other types of securities.

The company currently expects to make a cash contribution to the plan of approximately $3 to $4 million in 2004.

The following table sets forth the funded status of the plans for U.S. employees at year-end 2003 and 2002.

The presentation of the amounts reflected in the previous table in the Consolidated Balance Sheets at December 31, 2003 and December 31, 2002 is reflected in the following table.

The intangible asset is included in other noncurrent assets in the Consolidated Balance Sheets as of the respective dates. Accrued pension cost is included in long-term accrued liabilities.

The following table sets forth the status of the company’s defined benefit pension plan for certain employees in Germany.

The following table presents the weighted-average actuarial assumptions used to determine pension income or expense for all defined benefit plans in 2003, 2002 and 2001.

The following table presents the weighted-average actuarial assumptions used to determine the projected benefit obligation for all defined benefit plans at December 31, 2003 and December 31, 2002.

The company also maintains certain defined contribution and 401(k) plans. Participation in these plans is available to certain U.S. employees. Costs included in continuing operations for these plans were $1.6 million, $1.6 million and $2.6 million in 2003, 2002 and 2001, respectively.

In addition to pension benefits, the company also provides varying levels of postretirement health care benefits to certain U.S. employees. Substantially all such employees are covered by the company’s principal plan, under which benefits are provided to employees who retire from active service after having attained age 55 and ten years of service. The plan is contributory in nature. For employees retiring prior to 1980, contributions are based on varying percentages of the current per-contract cost of benefits, with the company funding any excess over these amounts. For employees retiring after 1979, the dollar amount of the company’s current and future contributions is frozen.

The following table presents the components of the company’s postretirement health care cost under the principal U.S. plan.

The following table summarizes changes in the accumulated postretirement benefit obligation for the principal U.S. plan.

The following table presents the components of the company’s liability for postretirement health care benefits under the principal U.S. plan.

The following table presents the discount rates used to calculate the accumulated postretirement benefit obligation at December 31, 2003, December 31, 2002 and December 31, 2001 and the rates used to calculate postretirement health care cost for the years then ended.

For 2004, the assumed rate of increase in health care costs used to calculate the accumulated postretirement benefit obligation is 8.5%. This rate is assumed to decrease in varying degrees annually to 5.0% for years after 2010. Because the dollar amount of the company’s contributions for most employees is frozen, a one percent change in each year in relation to the above assumptions would not significantly change the accumulated postretirement benefit obligation or the total cost of the plan.

On December 8, 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the Act) was enacted. Among other things, the Act created new federal subsidies for employers that provide prescription drug coverage for their retirees beginning in 2006. Because the principal postretirement health care plan for certain U.S. employees provides such coverage, the company is currently evaluating the potential effects of the Act. However, the company has concluded that it is impossible at this time to estimate the extent to which the subsidies will reduce the plan’s accumulated postretirement benefit obligation. In addition, the Financial Accounting Standards Board (FASB) has not yet completed its evaluation of the accounting implications of the Act. Accordingly, no adjustment to the recorded obligation has been made at December 31, 2003 as permitted by FASB Staff Position 106-1.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of the company’s deferred tax assets and liabilities as of year-end 2003 and 2002 are as follows:

Summarized in the following tables are the company’s earnings from continuing operations before income taxes, its provision for income taxes, the components of the provision for deferred income taxes and a reconciliation of the U.S. statutory rate to the tax provision rate.

As presented in the above table, loss from U.S. operations in 2003 includes restructuring costs of $9.7 million while loss from non-U.S. operations includes $17.4 million of such costs. Losses from U.S. and non-U.S. operations in 2002 include restructuring costs of $9.8 million and $4.1 million, respectively. In 2001, losses from U.S. operations and non-U.S. operations include restructuring costs of $6.7 million and $10.8 million, respectively. Loss from U.S. operations also includes goodwill impairment charges of $65.6 million in 2003 and $1.0 million in 2002.

The change in valuation allowances in 2003, as presented in the above table, represents $35.4 million related to 2003 activities and $69.2 million due to a change in circumstances and judgment related to deferred tax balances at December 31, 2002.

At year-end 2003 the company had a U.S. net operating loss carryforward of approximately $63 million that expires in 2023. The transaction entered into with Glencore Finance AG and Mizuho International plc on March 12, 2004 could substantially delay the timing of the utilization of these net operating loss carryforwards and other tax attributes in future years (see Subsequent Events). In addition, certain of the company’s non-U.S. subsidiaries had net operating loss carryforwards aggregating approximately $190 million, substantially all of which have no expiration dates.

Undistributed earnings of foreign subsidiaries which are intended to be indefinitely reinvested aggregated $95.5 million at the end of 2003. No deferred income taxes have been recorded with respect to this amount. The unrecorded deferred tax liability related to undistributed non-U.S. earnings was $33.4 million at December 31, 2003.

The company received net tax refunds of $17.0 million in 2003 and $14.2 million in 2002. Income taxes of $4.1 million were paid in 2001.

The following tables present the calculation of earnings available to common shareholders and a reconciliation of the shares used to calculate basic and diluted earnings per common share.

For all years, weighted-average shares assuming dilution excludes the effect of potentially dilutive stock options and restricted shares because their inclusion would result in a smaller loss per common share. Had they been included, weighted-average shares assuming dilution would have been 33,678 thousand in 2003, 33,513 thousand in 2002 and 33,340 thousand in 2001.

At December 31, 2003 and during several preceding years, the company maintained a receivables purchase agreement with a third-party financial institution. As accounts receivable were generated from customer sales made by certain of the company’s consolidated U.S. subsidiaries, those receivables were sold to Milacron Commercial Corp (MCC), a wholly-owned consolidated subsidiary. MCC then sold, on a revolving basis, an undivided percentage interest in designated pools of accounts receivable to the financial institution. As existing receivables were collected, MCC sold undivided percentage interests in new eligible receivables. Accounts that became 60 days past due were no longer eligible to be sold and the company was at risk for credit losses for which it maintained an allowance for doubtful accounts.

As of December 31, 2003, the company could receive up to $40.0 million at a cost of funds linked to commercial paper rates. During the fourth quarter of 2003, the liquidity facility that supported the program was extended from its scheduled expiration date of December 31, 2003 to February 27, 2004. The receivables purchase agreement was also amended to mature on that date. However, on February 27, 2004, the expiration of the liquidity facility and the maturity of the receivables purchase agreement were both extended to March 12, 2004.

At December 31, 2003, December 31, 2002 and December 31, 2001, the undivided interest in the company’s gross accounts receivable from continuing operations that had been sold to the purchaser aggregated $33.0 million, $34.6 million and $36.3 million, respectively. The amounts sold are reflected as reductions of accounts receivable in the Consolidated Balance Sheets as of the respective dates. Increases and decreases in the amount sold are reported as operating cash flows in the Consolidated Statements of Cash Flows. Costs related to the sales were $1.5 million in 2003, $1.2 million in 2002 and $2.2 million in 2001. These amounts are included in other expense-net in the Consolidated Statements of Operations.

On March 12, 2004, all amounts received under this facility were repaid (see Subsequent Events).

Certain of the company’s subsidiaries also sell accounts receivable on an ongoing basis. In some cases, these sales are made with recourse, in which case appropriate reserves for potential losses are recorded at the sale date. At December 31, 2003 and December 31, 2002, the gross amounts of accounts receivable that had been sold under these arrangements totaled $3.8 million and $5.0 million, respectively. At December 31, 2003, certain of these amounts were partially collateralized with approximately $3 million of cash deposits that are included in cash and cash equivalents in the Consolidated Balance Sheet at that date.

The company also periodically sells with recourse notes receivable arising from customer purchases of plastics processing machinery and, in a limited number of cases, guarantees the repayment of all or a portion of notes payable by its customers to third-party lenders. At December 31, 2003 and December 31, 2002, the company’s maximum exposure under these arrangements totaled $11.6 million and $12.4 million, respectively. In the event a customer were to fail to repay a note, the company would generally regain title to the machinery for later resale as used equipment. Costs related to sales of notes receivable and guarantees have not been material in the past.

Inventories amounting to $51.5 million in 2003 and $57.9 million in 2002 are stated at LIFO cost. If stated at FIFO cost, such inventories would be greater by approximately $17.2 million in 2003 and $15.7 million in 2002.

As presented in the Consolidated Balance Sheets, inventories are net of reserves for obsolescence of $27.0 million and $24.2 million in 2003 and 2002, respectively.

The carrying value of goodwill totaled $83.8 million and $143.3 million at December 31, 2003 and December 31, 2002, respectively. The decrease resulted principally from a goodwill impairment charge related to two businesses that are included in the mold technologies segment (see Goodwill Impairment Charge). The company’s other intangible assets, all of which are subject to amortization, are included in other noncurrent assets in the Consolidated Balance Sheets and totaled $6.5 million at December 31, 2003 and $7.8 million at December 31, 2002. Amortization expense related to these assets was $1.4 million in 2003, $1.0 million in 2002 and $.5 million in 2001.

Changes in goodwill during the years ended December 31, 2003 and December 31, 2002 are presented in the following table.

The following table presents the effects on net loss and basic and diluted loss per common share of excluding expense for the amortization of goodwill for all periods presented.

The components of property, plant and equipment, including amounts related to capital leases, are shown in the following table.

The components of other current assets and other noncurrent assets are shown in the tables that follow.

The components of accrued and other current liabilities are shown in the following tables.

The following table summarizes changes in the company’s warranty reserves. These reserves are included in accrued and other current liabilities in the Consolidated Balance Sheets.

The components of long-term accrued liabilities are shown in the following table.

On March 15, 2004, the 8 3/8% Notes due in 2004 were repaid (see Subsequent Events).

Except for the 8 3/8% Notes due 2004 and the 7 5/8% Eurobonds due 2005, the carrying amount of the company’s long-term debt approximates fair value. At year-end 2003, the fair value of the 8 3/8% Notes due 2004 was approximately $100 million and the fair value of the 7 5/8% Eurobonds due 2005 was approximately $130 million. These amounts are based on quoted prices on or about December 31, 2003.

The 7 5/8% Eurobonds due 2005 are a direct obligation of Milacron Capital Holdings B.V., a wholly-owned consolidated subsidiary, and have been guaranteed by the company.

Certain of the above long-term debt obligations contain various restrictions and financial covenants. Except for obligations under capital leases and certain non-U.S. bank borrowings, none of the company’s indebtedness is secured.

Total interest paid was $23.3 million in 2003, $35.8 million in 2002 and $40.5 million in 2001. Of these amounts, interest related to continuing operations was $22.0 million in 2003, $25.1 million in 2002 and $23.7 million in 2001.

Maturities of long-term debt excluding capital leases for the five years after 2003 are shown in the following table.

The company leases two manufacturing facilities under capital leases. The assets related to these leases are included in property, plant and equipment — net in the Consolidated Balance Sheets and had net book values of $16.6 million at December 31, 2003 and $15.8 million at December 31, 2002. Amortization of these assets is included in depreciation expense and interest on lease obligations is included in interest expense. Future minimum payments for capital leases during the next five years and in the aggregate thereafter are shown in the following table.

The company also leases certain equipment and facilities under operating leases, some of which include varying renewal and purchase options. Future minimum rental payments applicable to noncancellable operating leases during the next five years and in the aggregate thereafter are shown in the following table.

Rent expense related to continuing operations was $14.2 million, $13.7 million, and $11.2 million in 2003, 2002 and 2001, respectively.

At December 31, 2003, the company had lines of credit with various U.S. and non-U.S. banks totaling approximately $94 million, including a $65 million committed revolving credit facility that was due to expire on March 15, 2004. These credit facilities support the discounting of receivables, letters of credit, guarantees and leases in addition to providing borrowings under varying terms. At December 31, 2003, $54 million of the revolving credit facility was utilized including outstanding letters of credit of $12 million.

The company pledged as collateral for borrowings under the revolving credit facility the capital stock of its principal domestic subsidiaries as well as the inventories of the company and all of its domestic subsidiaries and certain other domestic tangible and intangible assets. The facility limited the payment of cash dividends and the incurrence of new debt and imposed certain restrictions on share repurchases, capital expenditures and cash acquisitions.

The revolving credit facility included a number of financial and other covenants, the most significant of which required the company to achieve specified minimum levels of four quarter trailing cumulative consolidated EBITDA (earnings before interest, taxes, depreciation and amortization). At December 31, 2003, Milacron was in compliance with all covenants.

On March 12, 2004, all amounts borrowed under the revolving credit facility were repaid with the proceeds of a new credit facility (see Subsequent Events).

At December 31, 2003, the company had additional credit lines totaling $29 million, of which approximately $15 million was available for use under certain circumstances.

The weighted-average interest rate on borrowings under lines of credit outstanding was 4.8% as of December 31, 2003 and 5.2% as of December 31, 2002.

In 2001, the company repurchased a total of 260,000 treasury shares on the open market at a cost of $5.2 million. An additional 109,440 shares were repurchased in connection with stock option exercises, restricted stock grants and employee benefit programs. Stock option exercises also resulted in the issuance of 28,500 previously unissued shares. A total of 426,543 treasury shares were reissued in 2001 in connection with management incentive and employee benefit programs.

In 2002, a total of 221,250 treasury shares were reissued in connection with grants of restricted shares and stock option exercises. An additional 147,473 shares were reissued for contributions to employee benefit plans and for the purchase of technology rights from a German manufacturer of plastics extrusion machinery. These reductions in treasury shares were partially offset by the cancellation of 81,448 restricted shares that were added to the treasury share balance in lieu of their cancellation.

In 2003, a total of 1,168,531 treasury shares were reissued in connection with grants of restricted shares and contributions to employee benefit programs. This reduction in treasury shares was partially offset by the forfeiture of 98,287 restricted shares that were added to the treasury share balance. The net reduction in treasury shares includes 851,500 restricted stock awards made to certain key employees, including the chief executive officer and other corporate officers. These grants were made in connection with an employee retention program approved by the company’s board of directors after consideration of advice from independent compensation consultants.

As presented in the previous table, common shares outstanding are net of treasury shares of 4,783,063 in 2003 and 5,853,307 in 2002.

The company has authorized 10 million serial preference shares with $1 par value. None of these shares have been issued.

On May 23, 2003, the company’s shareholders adopted an amendment to the company’s certificate of incorporation to eliminate the right of holders of common shares to ten votes per share upon satisfaction of certain ownership tenure requirements. In the past, holders of common shares were entitled to cast ten votes for each share that had been beneficially owned for at least 36 consecutive calendar months. As a result of the change, each common share is now entitled to one vote irrespective of the period of time it has been owned.

The company has a stockholder rights plan which provides for the issuance of one nonvoting preferred stock right for each common share issued as of February 5, 1999 or issued subsequent thereto. Each right, if activated, will entitle the holder to purchase 1/1000 of a share of Series A Participating Cumulative Preferred Stock at an initial exercise price of $70.00. Each 1/1000 of a preferred share will be entitled to participate in dividends and vote on an equivalent basis with one whole common share. Initially, the rights are not exercisable. The rights will become exercisable if any person or group acquires, or makes a tender offer for, more than 15% of the company’s outstanding common shares. In the event that any party should acquire more than 15% of the company’s common shares, the rights entitle all other shareholders to purchase the preferred shares at a substantial discount. In addition, if a merger occurs with any potential acquirer owning more than 15% of the shares outstanding, holders of rights other than the potential acquirer will be able to purchase the acquirer’s common stock at a substantial discount. On March 11, 2004, the company amended its stockholder rights plan to exempt the acquisition by Glencore Finance AG and Mizuho International plc of securities issued by the company in connection with the financing arrangements entered into on March 12, 2004 from triggering the rights under the plan (see Subsequent Events). The rights plan expires in February 2009.

On March 12, 2004, the company issued $100 million of exchangeable debt, $30 million of which is convertible into the company’s common stock at the option of the holders. As soon as certain conditions described in “Subsequent Events” are fulfilled, all such exchangeable debt and any common stock into which any such exchangeable debt had been previously converted will be exchanged for a new series of the company’s convertible preferred stock. Following exchange of the exchangeable debt for convertible preferred stock, the holders of the convertible preferred stock would collectively own approximately between 43% and 57% of Milacron’s fully diluted equity (on an as-converted basis) (see Subsequent Events).

Total comprehensive income or loss represents the net change in shareholders’ equity during a period from sources other than transactions with shareholders and, as such, includes net earnings or loss for the period. The components of total comprehensive loss are shown in the table that follows.

The components of accumulated other comprehensive loss are shown in the following table.

Various lawsuits arising during the normal course of business are pending against the company and its consolidated subsidiaries. In several such lawsuits, some of which seek substantial dollar amounts, multiple plaintiffs allege personal injury involving products, including metalworking fluids, supplied and/or managed by the company. The company is vigorously defending these claims and believes it has reserves and insurance coverage sufficient to cover potential exposures.

At December 31, 2003, the company had outstanding forward contracts totaling $4.7 million, which generally mature in periods of six months or less. These contracts require the company and its subsidiaries to exchange currencies on the maturity dates at exchange rates agreed upon at inception. Substantially all of these contracts have been designated as cash flow hedges with any gains or losses resulting from changes in their fair value being recorded as a component of other comprehensive income or loss pending completion of the transaction being hedged.

The 1997 Long-Term Incentive Plan (1997 Plan) permits the company to grant its common shares in the form of non-qualified stock options, incentive stock options, restricted stock and performance awards.

Under the 1997 Plan, non-qualified and incentive stock options are granted at market value, vest in increments over a four or five year period, and expire not more than ten years subsequent to the award. Of the 3,855,950 stock options outstanding at December 31, 2003, 246,000 are incentive stock options.

Summaries of stock options granted under the 1997 Plan and prior plans are presented in the following tables.

On April 21, 2003, the company’s executive officers waived all right and all interest to their options to purchase 465,900 common shares of the company. In all cases, the option prices were in excess of the current market price of the company’s common shares as of the date of the waivers. These waivers were made without any promise of future options being offered to these officers. The purpose of the waivers was to allow the

company to make future grants to participants under the company’s long-term incentive plans without increasing shareholder dilution.

The following tables summarize information about stock options outstanding at December 31, 2003.

As discussed more fully in the Stock-Based Compensation section of the note captioned “Summary of Significant Accounting Policies,” the company does not expense stock options. For purposes of determining the pro forma amounts presented in that section, the weighted-average per-share fair value of stock options granted during 2003, 2002 and 2001 was $2.37, $5.35 and $7.61, respectively. The fair values of the options were calculated as of the grant dates using the Black-Scholes option pricing model and the following assumptions:

Under the 1997 Plan, performance awards are granted in the form of shares of restricted stock which vest based on the achievement of specified earnings objectives over a three-year period. The 1997 Plan also permits the granting of other restricted stock awards, which also vest two or three years from the date of grant. During the restriction period, restricted stock awards entitle the holder to all the rights of a holder of common shares, including dividend and voting rights. Unvested shares are restricted as to disposition and subject to forfeiture under certain circumstances. Expense for restricted shares, including performance awards, was $.6 million in 2003 and $1.0 million in 2002. In 2001, reversals of prior years’ accruals for performance grants of $.3 million offset charges to expense totaling $.3 million for other restricted stock awards. Restricted stock award activity is as follows:

Restricted shares awarded as performance awards subject to contingent vesting totaled 38,000 in 2003, 46,000 in 2002 and 51,000 in 2001. Outstanding restricted shares subject to contingent vesting totaled 104,646, 141,795 and 159,493 at year-end 2003, 2002 and 2001, respectively. The amount outstanding at year-end 2003 includes 32,936 shares that will be cancelled in February 2004 because the basic earnings per common share objective for 2003 was not attained. In 2002 and 2001 restricted shares subject to contingent vesting of 52,519 and 52,806, respectively, were also cancelled.

Cancellations of restricted stock, including shares cancelled to pay employee withholding taxes at maturity, totaled 98,287 in 2003, 82,448 in 2002 and 73,133 in 2001.

Issuances of shares related to performance awards earned under a prior plan and to deferred directors’ fees totaled 19,903 in 2003, 1,003 in 2002, and 18,525 in 2001.

The company has four business segments: machinery technologies — North America, machinery technologies — Europe, mold technologies and industrial fluids.

The company’s segments conform to its internal management reporting structure and are based on the nature of the products they produce and the principal markets they serve. The machinery technologies —

North America segment produces injection molding machines and extrusion and blow molding systems for distribution primarily in North America at the company’s principal plastics machinery plant located near Cincinnati, Ohio. The segment also sells specialty and peripheral equipment for plastics processing as well as replacement parts for its machinery products. The machinery technologies — Europe segment manufactures injection molding machines and blow molding systems for distribution in Europe and Asia at its principal manufacturing plants located in Germany and Italy. The mold technologies segment — which has its major operations in North America and Europe — produces mold bases and components for injection molding and distributes maintenance, repair and operating supplies for all types of plastics processors. The industrial fluids segment is also international in scope with major blending facilities in the U.S. and The Netherlands and manufactures and sells coolants, lubricants, corrosion inhibitors and cleaning fluids used in metalworking.

The markets for all four segments tend to be cyclical in nature, especially in the two machinery segments where demand is heavily influenced by consumer confidence and spending levels, interest rates and general capital spending patterns, particularly in the automotive, packaging and construction industries. The markets for the mold technologies and industrial fluids are somewhat less cyclical and are influenced by industrial capacity utilization and consumer spending.

Financial data for the past three years for the company’s business segments are shown in the following tables. The accounting policies followed by the segments are identical to those used in the preparation of the company’s consolidated financial statements. The effects of intersegment transactions have been eliminated. The company incurs costs and expenses and holds certain assets at the corporate level which relate to its business as a whole. Certain of these amounts have been allocated to the company’s business segments by various methods, largely on the basis of usage. Management believes that all such allocations are reasonable.

Sales of U.S. operations include export sales of $73.0 million in 2003, $70.7 million in 2002 and $81.8 million in 2001.

Total sales of the company’s U.S. and non-U.S. operations to unaffiliated customers outside the U.S. were $338.2 million, $295.7 million and $306.7 million in 2003, 2002 and 2001, respectively.

On March 12, 2004, the company entered into a definitive agreement whereby Glencore Finance AG and Mizuho International plc purchased $100 million in aggregate principal amount of the company’s new exchangeable debt securities. The proceeds from this transaction, together with existing cash balances, were used to repay the 8 3/8% Notes due March 15, 2004. The securities the company issued were $30 million of 20% Secured Step-Up Series A Notes due 2007 and $70 million of 20% Secured Step-Up Series B Notes due 2007. The $30 million of Series A Notes were convertible into shares of the company’s common stock at a conversion price of $2.00 per share. Glencore Finance AG and Mizuho International plc converted the entire principal amount of the Series A Notes into 15 million shares of common stock on April 15, 2004. The Series A Notes and Series B Notes initially bore a combination of cash and pay-in-kind interest at a total rate of 20% per annum, which rate was retroactively reset on June 10, 2004 to 6% per annum from the date of issuance, payable in cash.

On March 12, 2004, the company also reached a separate agreement with Credit Suisse First Boston for a $140 million credit facility having a term of approximately one year. This senior secured credit facility consisted of a $65 million revolving A facility and a $75 million term loan B facility. On March 12, 2004, extensions of credit under the facility in an aggregate amount of $84 million were utilized to repay and terminate the company’s then-existing revolving credit facility and its then-existing receivables purchase program.

On May 26, 2004, Milacron Escrow Corporation, a wholly-owned, direct subsidiary of the company created solely to issue notes and to merge with and into the company, issued $225,000,000 in aggregate principal amount of 11 1/2% Senior Secured Notes due 2011 in a private placement. The proceeds of this issuance were initially placed in escrow. On June 10, 2004, the conditions for release of the proceeds from escrow were satisfied, including the consummation of the merger of Milacron Escrow Corporation with and into the company.

On June 10, 2004, the common stock into which the Series A Notes were converted and the Series B Notes were exchanged for 500,000 shares of Series B Preferred Stock, a new series of the company’s convertible preferred stock with a cumulative cash dividend rate of 6%. On June 10, 2004, the company also entered into an agreement for a new $75 million asset based revolving credit facility with JPMorgan Chase Bank as administrative agent and collateral agent.


	•	purchase €114,990,000 of the €115 million aggregate outstanding principal amount of Milacron Capital Holdings B.V.’s 7 5/8% Guaranteed Bonds due in April 2005 at the settlement of a tender offer therefor;

	•	terminate and repay $19 million in amounts outstanding under the revolving A facility (the company also used $17.4 million in availability under the asset based facility to replace or provide credit support for the outstanding letters of credit under the revolving A facility);

	•	repay the $75 million term loan B facility; and

	•	pay transaction expenses.

Pursuant to the terms of the asset based facility, the cash the company receives from collection of receivables is subject to an automatic “sweep” to repay the borrowings under the asset based facility on a daily basis. As a result, the company relies on borrowings under the asset based facility as the primary source of cash for use in our North American operations. The availability of borrowings under the asset based facility is subject to a borrowing base limitation, including an excess availability reserve, which may be adjusted from time to time by the administrative agent at its discretion, and the satisfaction of certain conditions to borrowing, including, among other things, conditions related to the continued accuracy of our representations and warranties and the absence of any unmatured or matured defaults (including under financial covenants) or any material adverse change in our business or financial condition. If the company has no additional availability or is unable to satisfy the borrowing conditions, its liquidity could be materially adversely affected.

The asset based facility contains a number of customary affirmative and negative covenants. In addition, the asset based facility contains, for the first five quarters, a financial covenant requiring us to maintain a minimum level of cumulative consolidated EBITDA, to be tested quarterly, and a limit on capital expenditures to be complied with on a quarterly basis, in each case starting with the third quarter of 2004. Thereafter, we will have to comply with a fixed charge coverage ratio to be tested quarterly.

as-converted basis). Glencore has reported in a Schedule 13D filing with the SEC that it has sold an undivided participation interest in its investment in us to Triage Offshore Funds, Ltd. equivalent to 62,500 shares of Series B Preferred Stock, representing approximately 7.2% of our outstanding equity (on an as-converted basis), with Glencore remaining as the record holder of such shares. If we redeem a portion of Glencore’s and Mizuho’s shares of Series B Preferred Stock with the proceeds of a rights offering, Glencore’s and Mizuho’s collective holdings would represent approximately 43% of our outstanding equity, with Triage’s participation interest in Glencore’s holdings representing approximately 5.0% of our outstanding equity, in each case on an as-converted basis and assuming full subscription of the rights offering. After seven years, the Series B Preferred Stock will automatically be converted into common stock at a conversion price of $2.00 per share but may be converted prior to that time at the option of the holders. The conversion price is subject to reset to $1.75 per share at the end of the second quarter of 2005 if a test based on our financial performance for 2004 is not satisfied. In addition, as part of the transaction we have issued to holders of the Series B Preferred Stock contingent warrants to purchase an aggregate of one million shares of our common stock, which contingent warrants are exercisable only if a test based on our financial performance for 2005 is not satisfied. Assuming that we do not conduct a rights offering to our existing shareholders, and both the conversion price of the Series B Preferred Stock is reset to $1.75 and the contingent warrants are exercised, the holders of the Series B Preferred Stock would own approximately 62.5% of our fully diluted equity (on an as-converted basis).

The conversion of the Series A Notes into newly issued common stock on April 15, 2004, and the exchange of such common stock and the Series B Notes for Series B Preferred Stock on June 10, 2004, triggered an “ownership change” for U.S. federal income tax purposes. As a consequence of this ownership change, timing of our utilization of tax loss carryforwards and other tax attributes will be substantially delayed. This delay will increase income tax expense and decrease available cash in future years.

The holders of the Series B Preferred Stock, voting separately as a class, have the right to elect a number of directors to our board of directors in proportion to the percentage of fully diluted common stock represented by the outstanding Series B Preferred Stock (on an as-converted basis), rounded up to the nearest whole number (up to a maximum equal to two-thirds of the total number of directors, less one).

After giving effect to the repayment and termination of the then-existing revolving credit facility and the then-existing accounts receivable liquidity facility, repayment of the senior U.S. notes, consummation of the tender offer for the Eurobonds, repayment and termination of the revolving A facility and the term loan B facility and payment of transaction expenses, the company’s current cash balance was approximately $35 million at June 10, 2004.

On May 26, 2004, 11 1/2% Senior Secured Notes due 2011 were issued by Milacron Escrow Corporation, a wholly owned, direct subsidiary of Milacron Inc. created solely to issue the Senior Secured Notes and to merge with and into Milacron Inc. The merger of Milacron Escrow Corporation with and into Milacron Inc. was completed on June 10, 2004. Also on June 10, 2004, the Senior Secured Notes were jointly, severally, fully and unconditionally guaranteed by the company’s U.S. and Canadian restricted subsidiaries and by Milacron Capital Holdings B.V. Following are condensed consolidating financial statements of the company, including the guarantors. This information is provided pursuant to Rule 3-10 of Regulation S-X in lieu of separate financial statements of each subsidiary guaranteeing the Senior Secured Notes. The following condensed consolidating financial statements present the balance sheet, statement of operations and cash flows of (i) Milacron Inc. (in each case, reflecting investments in its consolidated subsidiaries under the equity method of accounting), (ii) the guarantor subsidiaries of Milacron Inc., (iii) the nonguarantor subsidiaries of

Milacron Inc., and (iv) the eliminations necessary to arrive at the information for the company on a consolidated basis. The condensed consolidating financial statements should be read in conjunction with the accompanying consolidated financial statements of the company.

Section 145(a) of the General Corporation Law of the State of Delaware (the “DGCL”) provides in relevant part that a corporation may indemnify any officer or director who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding (other than an action by or in the right of the corporation) by reason of the fact that such person is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director or officer of another entity, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful.

Section 145(b) of the DGCL provides in relevant part that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

The Certificates of Incorporation or Bylaws of Milacron Inc., Milacron International Marketing Company, Pliers International, Inc., Milacron Resin Abrasives Inc., D-M-E Company, D-M-E Manufacturing Inc., Uniloy Milacron Inc., Cimcool Industrial Products Inc. and Milacron Plastics Technologies Group Inc., the Delaware corporation registrants, other than Pliers International Inc. generally provide that the Company shall indemnify its directors and officers to the fullest extent permissible under Delaware law and establish a procedure for determination of when indemnification is proper. In the case of Pliers International Inc., there are no specific provisions in its Certificate of Incorporation or Bylaws providing that Pliers International Inc. shall indemnify its directors and officers; however, the Board of Directors of Pliers International Inc. has the authority to provide such indemnification on a case-by-case basis.

The Certificates of Incorporation or Bylaws of each of the Delaware corporation registrants other than Pliers International Inc., Milacron International Marketing Company, Milacron Resin Abrasives Inc., D-M-E Company and Uniloy Milacron Inc. generally provide that the corporation shall advance and reimburse expenses prior to the final disposition of a proceeding under certain circumstances. In the case of Pliers International Inc., Milacron International Marketing Company, Milacron Resin Abrasives Inc., D-M-E Company and Uniloy Milacron Inc., there are no specific provisions in their Certificates of Incorporation or Bylaws requiring such indemnification; however, the Boards of Directors of each corporation have the authority to provide such advancement on a case-by-case basis.

Section 145(g) of the DGCL provides that a corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation,

Section 1701.13(E)(1) of the Ohio Revised Code (the “ORC”) provides that a corporation may indemnify or agree to indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending, or completed proceeding (other than an action by or in the right of the corporation) by reason of the fact that such person is or was a director or officer of the corporation, against liability reasonably incurred by the director or officer in connection with such proceeding if the director or officer acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful.

Section 1701.13(E)(2) of the ORC provides that a corporation may indemnify or agree to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed proceeding, by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director or officer against liability reasonably incurred by the person in connection with the defense or settlement of such proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made (subject to certain exceptions) if: (a) such person shall have been adjudged to be liable for negligence or misconduct in the performance of the person’s duty to the corporation unless and only to the extent that the court in which the proceeding was brought shall determine upon application that, despite the adjudication of liability, in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses as such court shall deem proper; or (b) the only liability asserted against a director in a proceeding is for the director voting for or assenting to the following: the payment of a dividend or distribution, the making of a distribution of assets to shareholders, or the purchase or redemption of the corporation’s own shares in violation of Ohio law or the corporation’s articles of incorporation; a distribution of assets to shareholders during the winding up of the affairs of the corporation, or on dissolution or otherwise, without the payment of all known obligations of the corporation or without making adequate provision for their payment; or the making of a loan, other than in the usual course of business, to an officer, director or shareholder of the corporation other than in the case of at the time of the making of the loan, a majority of the disinterested directors of the corporation voted for the loan and taking into account the terms and provisions of the loan and other relevant factors, determined that the making of the loan could reasonably be expected to benefit the corporation.

Neither the Articles of Incorporation nor the Regulations of Milacron Marketing Company, the Ohio corporation registrant, have any provision regarding the indemnification of directors or officers.

Section 1701.13(E)(7) of the ORC provides that a corporation may purchase and maintain insurance on behalf of any director or officer against any liability asserted against, and incurred in his or her capacity as a director or officer, whether or not the corporation would have the power to indemnify the director or officer against this liability under Ohio law.

Section 450.1561 of the Michigan Business Corporation Act (the “MBCA”), in general, provides that a corporation may indemnify any person who is a party or threatened to be made a party to any civil, criminal, administrative or investigative action, suit or proceeding (other than actions by or in the right of the corporation) by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or of another enterprise at such corporation’s request, against expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred in connection therewith if such person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the

Section 450.1562 of the MBCA provides that a corporation may indemnify any director or officer against amounts paid in settlement and expenses actually and reasonably incurred by such a person in actions or suits by or in the right of the corporation except in respect of any claim, issue or matter as to which such person is adjudged to be liable to the corporation, unless and only to the extent that a court determines that, despite the adjudication of the liability but in view of all circumstances of the case, such person is fairly and reasonably entitled to indemnity.

The Articles of Incorporation or Bylaws of Milacron Industrial Products, Inc., Oak International, Inc., Uniloy Milacron U.S.A. Inc. and D-M-E U.S.A. Inc., the Michigan corporation registrants, other than Uniloy Milacron U.S.A. Inc. generally provide that the corporation shall indemnify its directors and officers to the fullest extent permissible under Michigan law, provide that the corporation shall advance and reimburse expenses under certain circumstances and establish a procedure for determination of when indemnification is proper. In the case of Uniloy Milacron U.S.A. Inc., there are no specific provisions in its Articles of Incorporation or Bylaws providing that Uniloy Milacron U.S.A. Inc. shall indemnify its directors and officers; however, the Board of Directors of Uniloy Milacron U.S.A. Inc. has the authority to provide such indemnification on a case-by-case basis.

Section 450.1567 of the MBCA provides in relevant part that a corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the corporation, or who is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against him or her and incurred by him or her in any such capacity or arising out of his or her status as such, whether or not the corporation would have power to indemnify him or her against liability.

Section 8.75(a) of the Illinois Business Corporation Act of 1983 (the “IBCA”) provides that a corporation may indemnify a director or officer against liabilities and expenses if the director or officer acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation, and, in the case of a criminal action, if the director or officer had no reason to believe his or her conduct was unlawful.

Section 8.75(b) of the IBCA provides that, in a proceeding brought by or in the right of the corporation, no indemnification may be made with respect to any claim as to which an officer or director has been adjudged to have been liable to the corporation, unless the court determines that that person is reasonably and fairly entitled to indemnification for expenses.

The Bylaws of Nickerson Machinery Chicago, Inc., the Illinois corporation registrant, provide that the corporation shall indemnify its directors and officers against all expenses and liabilities, including counsel fees, reasonably incurred by or imposed upon him in connection with any proceeding to which he may be a party, or in which he may become involved, by reason of his being or having been a director or officer or is or was serving at the request of the corporation as such person, whether or not such person is a director or officer at the time such expenses are incurred, except in such cases wherein such person is adjudged guilty of willful misfeasance or malfeasance in the performance of such person’s duties, provided that in the event of a settlement the indemnification shall apply only when the board of directors approves such settlement and reimbursement as being for the best interests of the corporation. In addition, Nickerson Machinery Chicago, Inc. shall provide any person who is a director or officer or is or was serving at the request of the corporation as a director or officer indemnification against expenses of suit, litigation or other proceeding which is specifically permissible under applicable law.

Section 8.75(g) of the IBCA provides that a corporation may maintain insurance on behalf of officers and directors against liabilities asserted against the individual arising out of his or her status as an officer or

Minnesota Statutes Section 302A.521, subdivision 2 requires (subject to subdivision 4 thereof) a corporation to indemnify any director, officer or employee who is made or threatened to be made party to a proceeding by reason of the former or present official capacity of the director, officer or employee, against judgments, penalties, fines, settlements and reasonable expenses, subject to certain conditions described in said statute. Minnesota Statutes Section 320A.521, subdivision 4 permits a corporation to prohibit or impose conditions and/or limits on indemnification by so providing in its articles of incorporation or its bylaws.

The Bylaws of Northern Supply Company, Inc., the Minnesota corporation registrant, provide that the corporation shall indemnify in accordance with 302A.521.

Minnesota Statutes Section 320A.521, subdivision 7 permits a corporation to purchase and maintain insurance on behalf of a person in that person’s official capacity against any liability asserted against and incurred by the person in or arising from that capacity, whether or not the corporation would have been required to indemnify the person against the liability under the provisions of this section.

Sections 136(1) and 136(3) of the Business Corporations Act (Ontario) (the “OBCA”) provide that a director or officer of the corporation, a former director or officer of the corporation, or a person who acts or acted at the corporation’s request as a director or officer of a body corporate of which the corporation is or was a shareholder or creditor (“specified individuals”) may be indemnified against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of such a corporation only if such person acted honestly and in good faith with a view to the best interests of the corporation, and, with respect to a criminal or administrative action or proceeding that is enforced by a monetary penalty, such person had reasonable grounds for believing that his conduct was lawful.

The Bylaws of D-M-E of Canada Limited, Progress Precision Inc., 450500 Ontario Limited, 528650 Ontario Limited and Milacron Canada Inc., the Ontario corporation registrants, generally provide, subject to any limitations in the OBCA, that the corporation shall indemnify a director or officer of the corporation, a former director or officer of the corporation, or a person who acts or acted at the corporation’s request as a director or officer of a body corporate of which the corporation is or was a shareholder or creditor and his heirs and assigns or legal representatives against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of such a corporation if he acted honestly and in good faith with a view to the best interests of the corporation, and, with respect to a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

Section 136(4) of the OBCA provides that a corporation may purchase and maintain insurance for the benefit of any person referred to in subsection 136(1) against any liability incurred by the person (a) in his or her capacity as a director or officer of the corporation, except where the liability relates to the person’s failure to act honestly and in good faith with a view to the best interests of the corporation or (b) in his or her capacity as a director or officer of another body corporate where the person acts or acted in that capacity at the corporation’s request, except where the liability relates to the person’s failure to act honestly and in good faith with a view to the best interests of the body corporate.

Sections 124(1) and (3) of the Canada Business Corporations Act (the “CBCA”) provide that a corporation may indemnify a director or officer of the corporation, a former director or officer of the corporation or another individual who acts or acted at the corporation’s request as a director or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with the corporation or other entity if such person acted honestly and in good faith with a view to the best interests of the corporation, or, as the case may be, to the best interests of the other entity for which the individual acted as director or officer or in a similar capacity at the corporation’s request, and, with respect to a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that the individual’s conduct was lawful.

The Bylaws of 2913607 Canada Limited, the Canada corporation registrant, generally provide, subject to any limitations in the CBCA, that the corporation shall indemnify a director or officer of the corporation, a former director or officer of the corporation, or a person who acts or acted at the corporation’s request as a director or officer of a body corporate of which the corporation is or was a shareholder or creditor and his heirs and assigns or legal representatives against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of such a corporation if he acted honestly and in good faith with a view to the best interests of the corporation, and, with respect to a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

Section 124(6) of the CBCA provides that a corporation may purchase and maintain insurance for the benefit of an individual referred to in subsection 124(1) against any liability incurred by the individual (a) in the individual’s capacity as a director or officer of the corporation or (b) in the individual’s capacity as a director or officer, or similar capacity, of another entity, if the individual acts or acted in that capacity at the corporation’s request.

It is generally believed by a majority of scholars that a Dutch company is not permitted to indemnify its members of its Management Board (each such member is hereinafter referred to as a “Director”) or its officers or proxyholders (procuratiehouders) (each such person is hereinafter referred to as an “Officer”) for (i) liability which such Director or Officer may incur in his or her capacity as such vis-à-vis the company or (ii) liability for gross negligence or willful misconduct in acting in his or her capacity of Director or Officer vis-à-vis third parties. Dutch statutory law does not provide for an indemnification of Directors or Officers of a Dutch company against liability which such Director or Officer may incur in his or her capacity as such.

The Articles of Association of Milacron Capital Holdings B.V., the Dutch corporation registrant, do not contain any provisions regarding indemnification of its Directors or Officers.

Dutch law does not prevent a Dutch company from purchasing or maintaining liability insurance on behalf of its Directors or Officers whether or not the company would have the power to indemnify such Directors or Officers.

Milacron Inc. maintains a global Directors’ and Officers’ liability insurance policy that provides coverage to all directors and officers of all registrants.

Milacron Inc. hereby agrees to furnish to the Securities and Exchange Commission, upon its request, the instruments with respect to long-term debt for securities authorized thereunder which do not exceed 10% of Milacron Inc.’s total consolidated assets

The undersigned registrant hereby undertakes: to file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; to include any prospectus required by section 10(a)(3) of the Securities Act of 1933; to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; that, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Cincinnati, State of Ohio, on June 23, 2004.


	By:	/s/ RONALD D. BROWN



	Name: Ronald D. Brown
	Title: Chairman, President and Chief Executive Officer

The undersigned hereby constitute and appoint Ronald D. Brown, Robert P. Lienesch, Hugh C. O’Donnell and Walter S. Wood and each of them with full power to act without the other and with full power of substitution and resubstitution, our true and lawful attorneys-in-fact with full power to execute in our name and behalf in the capacities indicated below this Registration Statement and any and all amendments thereto, including post-effective amendments to this Registration Statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission and hereby ratify and confirm that all such attorneys-in-fact, or any of them, or their substitutes shall lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.


	NORTHERN SUPPLY COMPANY, INC.
	NICKERSON MACHINERY CHICAGO INC.
	PLIERS INTERNATIONAL INC.
	CIMCOOL INDUSTRIAL PRODUCTS INC.
	MILACRON PLASTICS TECHNOLOGIES GROUP INC.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.


	450500 ONTARIO LIMITED
	528650 ONTARIO LIMITED
	2913607 CANADA LIMITED

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

II-30 EX-3.4 2 y98028exv3w4.txt ARTICLES OF INCORPORATION EXHIBIT 3.4 BAKER & MCKENZIE ATTORNEYS AT LAW, TAX ADVISORS AND CIVIL-LAW NOTARIES ARTICLES OF INCORPORATION Name and registered office Article 1 1. The company's name is: MILACRON CAPITAL HOLDINGS B.V. 2. The company has its registered office in: Vlaardingen. Objects Article 2 The company's objects are: a. to incorporate, participate in, conduct the management of and take any other financial interest in other companies and enterprises; b. to render administrative, technical, financial, economic or managerial services to other companies, persons or enterprises; c. to acquire, dispose of, manage and utilise real and personal property, including patents, marks, licences, permits and other industrial property rights; d. to borrow and lend moneys, act as surety or guarantor in any other manner, and bind itself jointly and severally or otherwise in addition to or on behalf of others, the foregoing whether or not in collaboration with third parties and inclusive of the performance and promotion of all activities which directly and indirectly relate to those objects, all this in the broadest sense of the terms. Authorised capital Article 3 1. The company's authorised capital amounts to one hundred thousand Euro (EUR 100,000.--). 2. It is divided into one hundred (100) shares with a par value of one thousand Euro (EUR 1,000.--) each. 3. All shares shall be in registered form and shall be consecutively numbered from 1 onwards. Share certificates shall not be issued. Shareholders' register Article 4 1. The company's Board of Managing Directors shall keep a register in which the names and addresses of all holders of shares shall be recorded, specifying the date on which they acquired their shares, the date of acknowledgment by or service upon the company and the amount paid for each share. The register shall also contain the names and addresses of all owners of a 2 usufruct or pledge on those shares, specifying the date on which they acquired such usufruct or pledge, the date of acknowledgment by or service upon the company and what rights they have been granted attaching to the shares under Articles 197 and 198, paras. 2 and 4, Book 2, Dutch Civil Code. 2. Article 194, Book 2, Dutch Civil Code shall apply to the register. Issuance of shares Article 5 1. Shares may only be issued pursuant to a resolution by the general meeting of shareholders, hereinafter to be referred to as the "general meeting". Issuance shall be by means of a notarial deed, executed before a civil-law notary authorised to practise in the Netherlands, and to which those involved are party. 2. With due observance of the restrictions provided by law, shareholders shall have pre-emptive rights with respect to any further share issue in proportion to the total value of their individual shareholdings. 3. Likewise, shareholders shall have pre-emptive rights with respect to the granting of options to subscribe to shares. 4. Said pre-emptive rights may, for every single issue, be limited or suspended by the general meeting. 5. When a share is issued, its par value must be fully paid up. It may be stipulated that a portion of the share's par value, not exceeding three-fourths thereof, need not be paid until after such portion is called up by the company. Own shares Article 6 1. With due observance of the relevant statutory provisions, the company may acquire its own fully-paid shares or depositary receipts, however, subject to the maximum permitted by law. 2. The company may grant loans for the purpose of subscribing to or acquiring its shares or depositary receipts, however, subject to the sum of its distributable reserves. Transfer of shares. Usufruct. Pledge. Depositary receipts Article 7 1. The transfer of shares or any restricted rights attaching to shares shall require a notarial deed, executed before a civil-law notary authorised to practise in the Netherlands, to which those involved are party. 2. The transfer of shares or any restricted rights attaching to shares as referred to in para. 1 - including the creation and relinquishment of restricted rights - shall, by 3 operation of law, also be valid vis-a-vis the company. The rights attaching to shares cannot be exercised until the company either acknowledges the juristic act or is served with the notarial deed in accordance with the relevant statutory provisions, except where the company is party to the juristic act. 3. In the event that a usufruct or pledge is created on shares, voting rights may be granted to the usufructuary or pledge. 4. The company shall not cooperate in issuing depositary receipts for its shares. Transfer restrictions Article 8 Approval 1. In order to be valid, every transfer of shares shall require the prior approval of the general meeting, unless all shareholders have given their approval in writing. The approval shall be valid for three months only. 2. The shareholder who wishes to transfer his shares - hereinafter to be referred to as the "proposing transferor" - shall inform the Board of Managing Directors by registered mail or return receipt requested, specifying the number of shares to be transferred and the person(s) to whom he wishes to transfer his shares. 3. The Board of Managing Directors shall be obliged to call a general meeting to be held within six weeks of receiving the proposing transferor's notification. The convening notice shall state the content of the notification. 4. If the general meeting grants the approval requested, the transfer must take place within the following three months. 5. Approval shall be deemed given if: a. the general meeting referred to in paragraph 3 has not been held within the term set in that paragraph; b. that general meeting has failed to decide on the request for approval; c. simultaneously with its refusal, the general meeting fails to notify the proposing transferor of the name(s) of (an) other party(ies) interested in purchasing for cash all shares to which the request for approval relates. If the situation under paragraph 5a. above occurs, approval shall be deemed to have been given on the last date on which the shareholders' meeting should have been held. 6. Unless the proposing transferor and the interested party(ies) specified by the general meeting and accepted by the proposing transferor make deviating arrangements regarding the price or the method of determining the price, the purchase price of the shares shall be determined by an independent expert to be 4 appointed at the request of the party with the greatest interest by the Chairman of the Chamber of Commerce and Industry of the district in which the company's registered office is situated. 7. The proposing transferor shall remain entitled to withdraw his offer, provided that he does so within one month of having been informed of the name of the party to whom he may transfer all of the shares specified in the request for approval and of the price offered for the shares. 8. The costs incurred in determining the purchase price shall be borne: a. by the proposing transferor if he withdraws his offer; b. in equal parts by the proposing transferor and the buyers if the shares are purchased by the interested parties, on the understanding that every buyer shall contribute to the costs in proportion to the number of shares he has bought; c. by the company, in all cases not included under a. or b. 9. The company itself may propose to buy the shares as contemplated in para. 5(c) only if the proposing transferor so consents. Board of Managing Directors Article 9 1. The company shall be run by a Board of Managing Directors consisting of one or more Managing Directors. 2. The general meeting shall appoint the Managing Directors. 3. The general meeting shall at all times have the power to suspend or dismiss the Managing Directors. 4. The general meeting shall determine the remuneration of each Managing Director, as well as his other terms and conditions of employment. Managerial duties. Decision-making. Division of duties Article 10 1. Subject to the restrictions set forth in these Articles, the Board of Managing Directors shall be in charge of running the company. 2. The general meeting may adopt rules and regulations governing the decision-making process of the Board of Managing Directors. 3. The Board of Managing Directors shall make a division of duties and report such division to the general meeting. Representative authority Article 11 1. The Board of Managing Directors shall represent the company. If the Board of 5 Managing Directors consists of more than one Managing Director the authority to represent the company shall also be vested in two Managing Directors acting jointly. 2. The Board of Managing Directors may appoint officers and grant them a general or special power of attorney. Every attorney in fact shall represent the company within the bounds of his authorisation. Their title shall be determined by the Board of Managing Directors. 3. In the event that the company has a conflict of interest with a managing director, in the sense that the managing director in private enters into an agreement with, or is party in a legal proceeding between him and the company, the company shall be represented by one of the other managing directors. If there are no such other managing directors, the general meeting shall appoint a person to that effect. Such person may be the managing director in relation to whom the conflict of interest exists. In all other cases of a conflict of interest between the company and a managing director, the company can also be represented by that managing director. The general meeting shall at all times be authorized to appoint one or more other persons to that effect. Restrictions on the powers of the Board of Managing Directors Article 12 1. The general meeting shall be authorised to make subject to its approval Board of Managing Directors resolutions. Any such resolution shall be clearly described and reported to the Board of Managing Directors in writing. 2. The Board of Managing Directors must comply with any such instructions outlining the company's general financial, social, economic or staffing policy to be pursued by the Board of Managing Directors as may be given by the general meeting. 3. The absence of approval as defined in this Article cannot be invoked by or against any third party. Absence. Inability to act Article 13 If a Managing Director is absent or unable to act, the remaining Managing Director(s) shall be temporarily charged with the management of the company. If the sole Managing Director is or all Managing Directors are absent or unable to act, a person appointed annually by the general meeting shall be temporarily charged with the management of the company. 6 Financial year. Annual accounts Article 14 1. The company's financial year shall correspond with the calendar year. 2. Within five months of the end of the company's financial year, the Board of Managing Directors shall draw up the annual accounts unless, in special circumstances, an extension of this term by not more than six months is approved by the general meeting. 3. The general meeting shall adopt the annual accounts. Profits Article 15 1. The profits shall be at the disposal of the general meeting. 2. Dividends may be paid only insofar as the company's equity exceeds the paid-in and called-up capital plus the reserves to be kept by law. 3. The general meeting may, with due observance of para. 2, resolve to pay interim dividends. 4. The general meeting may, with due observance of para. 2, resolve to pay dividends out of a reserve which need not be kept by law. General meeting of shareholders Article 16 1 The general meeting of shareholders shall be held within six months of the end of the company's financial year in order to discuss and adopt the annual accounts. 2. Other general meetings of shareholders shall be held as often as either the Board of Managing Directors or the shareholders representing not less than one-tenth of the company's issued capital deem necessary. 3. General meetings of shareholders shall be called by either the Board of Managing Directors or the shareholders representing one-tenth of the company's issued capital, by sending letters to the addresses recorded in the shareholders' register. Convocation shall take place not later than on the fifteenth day prior to the day of the meeting. 4. Resolutions may be legally adopted on any item on the agenda provided that they are adopted by a unanimous vote at a general meeting at which the company's entire issued capital is represented, even if the requirements for convening and conducting the meeting as prescribed by the law or the company's Articles of Incorporation have not been complied with. 5. General meetings shall be held in the municipality in which the company's registered office is situated according to its Articles of Incorporation. 7 6. At every meeting, the shareholders shall appoint a chairman from their midst. 7. Every share shall entitle its holder to cast one vote. 8. Resolutions shall be passed by an absolute majority of the votes cast, unless the law prescribes a greater majority. Resolutions passed outside a meeting Article 17 Rather than at a general meeting, the shareholders may also pass resolutions in writing, provided that they do so by a unanimous vote representing the company's entire issued capital. In writing shall mean any message transmitted via standard means of communication and received in written form. Amendment to the Articles of Incorporation and dissolution Article 18 If a motion to amend the Articles of incorporation or to dissolve the company is submitted to the general meeting, the convening notice must state this fact. If such notice concerns an amendment to the Articles of Incorporation a copy of the motion containing a verbatim text of the proposed amendment must be deposited at the company's office for inspection by the shareholders until the meeting is adjourned. Liquidation Article 19 1. If the company is dissolved pursuant to a resolution of the general meeting, it shall be liquidated by the Board of Managing Directors, if and to the extent the general meeting does not resolve otherwise. 2. After the liquidation has been finished, the books and records of the company shall remain in the custody during a ten year period of the person designated for that purpose by the general meeting. Final provisions Finally, the deponent declared as follows: a. Upon the company's incorporation, its issued capital amounts to twenty thousand Euro (EUR 20,000.--), divided into twenty (20) shares, numbered 1 up to and including 20. The incorporator shall be allocated all twenty (20) shares. The shares have been issued at par. The payment, which may be made in foreign currency, must be made in cash. The documents required under Article 203a, Book 2, Dutch Civil Code, have been attached to this deed. The company hereby accepts those payments for the shares issued upon its 8 incorporation. b. The following person is hereby appointed as the company's first Managing Director: Mister Gerardus van Deventer, residing at 3136 SG Vlaardingen, Eksteriaan 252, born in Schiedam on the sixteenth day of August nineteenhundred and forty-nine, having the Dutch nationality C. The company's first financial year shall end on the thirty-first day of December two thousand. EX-3.5 3 y98028exv3w5.txt ARTICLES OF INCORPORATION EXHIBIT 3.5 THE STATE OF OHIO, COUNTY OF HAMILTON...... ss. Personally appeared before me, the undersigned, a Notary Public, in and for said county this 20th day of August, 1931, the above named John N. Gatch, Philip Hinkle and Catherine K. Toerner, who each severally acknowledged the signing of the foregoing articles of incorporation to be his free act and deed, for the [ILLEGIBLE] and purposes therein mentioned. WITNESS my hand and official seal on the day and year last aforesaid. [Notary seal] /s/ Robert P. Klenmann ----------------------- Robert P. Klenmann Notary Public Hamilton County, Ohio Sec. [ILLEGIBLE]. A corporation for profit may be formed hereunder for any purpose or purposes, other than for carrying on the practice of any profession, for which natural persons lawfully may associate themselves, provided that where the General Code [ILLEGIBLE] special provision for the filing of articles of incorporation of designated classes of corporations, such corporations shall be formed under such provisions and not hereunder. Corporations for the erection, owning and conducting of sanitariums for receiving and caring for patients, their medical and hygienic treatment and instruction of nurses in the treatment of disease and of hygiene shall not be deemed to be forbidden hereby. Sec. [ILLEGIBLE]. Any number of natural persons, not less than three, a majority of whom are citizens of the United States, may become a corporation, by subscribing, acknowledging and filing in the office of the secretary of state articles of incorporation, hereafter called articles, setting forth: 1. The name of the corporation, which may begin with the word "the" and shall end with or include "company," "co.," "corporation," "incorporated," or "inc." except as otherwise provided by law. 2. The place in this state where the principal office of the corporation is to be located. 3. The purpose or purposes for which it is formed. 4. The maximum number and the par value of shares with par value, and the maximum number of shares without par value which the corporation is authorized to have outstanding; and if the shares are to be classified-- (a) the designation of each class, the number and par value, if any, of the shares of each class and, if desired, of the series of any class; and (b) the express terms and provisions of the shares of each class. "Express terms and provisions," as used in this act, shall mean any dividend rates, preferences, conversion rights, voting rights, pre-emptive rights, rights in stated capital, option rights, participation rights, redemption rights, which may be [ILLEGIBLE] or of the corporation or at a specific time or in a specific event, amounts payable on redemption of [ILLEGIBLE] merger, or sale of entire assets of the corporation (hereinafter sometimes designated "liquidation price"), right of alteration of express terms and provisions and any other relative rights of shareholders, or any restrictions or qualifications of the rights of the holders of shares of any class, which are expressed in the articles. In lieu of stating the dividend rate, redemption price, or liquidation prices of shares of any class, or the series of any class of shares, or the number of shares constituting any series, the articles may authorize the board of directors of the corporation, at one time or from time to time, within the limitations and restrictions stated therein, to fix or alter such dividend rate, redemption price, or liquidation price, or the series or the number of shares constituting any series or any of them, in respect of shares [ILLEGIBLE] or in the treasury of the corporation, by adopting an amendment to the articles, which amendment shall be filed in the effect of the secretary of state before the issuance of any such shares, or the disposal of treasury shares on terms so fixed [ILLEGIBLE]. 5. The amount of capital with which the corporation will begin business, which shall not be less than five hundred dollars. 6. If desired, the amount of consideration for which subscriptions to shares without par value may be received by the incorporators, and the valuation of any considerations to be received for shares either with or without par value proposed to be [ILLEGIBLE] issued. 7. Any lawful provisions which may be desired for the purpose of defining, limiting and regulating the exercise of the authority of the corporation, or of the directors or of the shareholders or of any class of shareholders or, for the purpose of creating and defining rights and privileges of the shareholders among themselves. Any provisions authorized to be made in the regulations of a corporation may, if [ILLEGIBLE] in its articles. If the corporation is for a purpose which [ILLEGIBLE] construction of a steam or electric railroad in more than one county or state, the articles shall also set forth its termini[ILLEGIBLE] in this state into or through which it or its branches will pass. A written appointment of an agent [ILLEGIBLE], tax notices and demands against such corporation may be served as hereafter provided shall be filed with [ILLEGIBLE]. N.B. New matter. n 113 Ohio [ILLEGIBLE]. 1552 [ILLEGIBLE] Page 20 Line 11 Number 147731 Form A Articles of Incorporation -OF- THE CINCINNATI MILLING MACHINE CO. AND CINCINNATI GRINDERS INC. SALES CO. Filed in the office of the Secretary of State, at Columbus, Ohio on the 20 day of Aug., 1931, and recorded in Volume 399, Page 483 of the Records of Incorporation. /s/ [ILLEGIBLE] - --------------- Secretary of State Remarks Articles of incorporation must be subscribed by at least three persons, a majority of whom must be citizens of the United States [ILLEGIBLE] /s/ ILLEGIBLE - ------------- Cincinnati, Ohio CORPORATION FOR PROFIT 1552 934 UNCLASSIFIED SHARES WITH PAR VALUE ARTICLES OF INCORPORATION --OF-- THE CINCINNATI MILLING MACHINE CO. AND CINCINNATI GRINDERS INC. SALES CO. (Name of Corporation) The undersigned, a majority of whom are citizens of the United States, desiring to form a corporation, for profit, under the General Corporation Act of Ohio, do hereby certify: FIRST. The name of said corporation shall be THE CINCINNATI MILLING MACHINE CO. AND CINCINNATI GRINDERS INC. SALES CO. SECOND. The place in Ohio where the principal office is to be located is CINCINNATI, HAMILTON County. (City, Village or Township) THIRD. The purpose or purposes for which it is formed are: To buy, manufacture or otherwise acquire, own, hold, sell or otherwise dispose of, trade and otherwise deal in, machinery, machine tools, accessories, tools, supplies, parts, materials, goods, wares, merchandise and personal property of all kinds, both tangible and intangible; To acquire by purchase, application or otherwise, own, hold, sell or otherwise dispose of or otherwise deal in, develop and perfect inventions, processes, methods, patents, applications, patent rights and privileges, copyrights, trade marks and trade names, or any rights, options or contracts of similar nature or relating thereto or connected therewith; To acquire, own, hold and dispose of such real estate or interests in real estate as shall be necessary, convenient or expedient to accomplish any of said purposes; To do all such further acts as are necessary, convenient or expedient to accomplish the above purposes; The enumeration of the above purposes in these Articles of Incorporation, shall not be held to limit or restrict in any manner the general powers of the corporation and it shall have all capacity permitted by law. FOURTH. The maximum number of shares which the corporation is authorized to have outstanding is Two Hundred and Fifty (250), all of which shall be with a par value of One Hundred Dollars ($100.00) each. FIFTH. The amount of capital with which the corporation will begin business is Five Hundred Dollars ($500.00). IN WITNESS WHEREOF, We have hereunto subscribed our names this 10th day of August 1932. /s/ [ILLEGIBLE] /s/ [ILLEGIBLE] /s/ [ILLEGIBLE] ALL ARTICLES OF INCORPORATION FILED ON OR AFTER JULY 23, 1929, MUST BE ACCOMPANIED BY FOLLOWING DESIGNATION OF AGENT. --------------- ORIGINAL APPOINTMENT OF AGENT Ohio Corporation, Section 8623-129,General Code. --------------- KNOWN ALL MEN BY THESE PRESENTS, That WALTER H. GEIER of Marburg Ave. & South St., Name of Agent Street or Avenue in Oakley, Cincinnati, Hamilton County, Ohio, a natural person and resident of City or Town said county, being the county in which the principal office of THE CINCINNATI MILLING MACHINE CO. AND CINCINNATI GRINDERS INC. SALES CO. Name of Corporation is located, is hereby appointed as the person on whom process, tax notices and demands against said THE CINCINNATI MILLING MACHINE CO. AND CINCINNATI GRINDERS Name of Corporation INC. SALES CO. may be served. THE CINCINNATI MILLING MACHINE CO. AND CINCINNATI GRINDERS INC. CO. Name of Corporation /s/ [ILLEGIBLE] /s/ [ILLEGIBLE] /s/ [ILLEGIBLE] Incorporators (To be executed by all or a majority of the Incorporators at a time of the organization) Cincinnati, Hamilton Co., Ohio, THE CINCINNATI MILLING MACHINE CO. August 19, A.D. 1931 AND CINCINNATI GRINDERS INC. SALES CO. Name of Corporation Cincinnati, Ohio Gentlemen: I hereby accept the appointment as the representative of your company upon whom process, tax notices, or demands may be served. /s/ [ILLEGIBLE] ------------------------- Agent --------------- State of Ohio, County of HAMILTON ss.: Personally appeared before me, the undersigned, a Notary Public in and for said County, this 19th day of August, A.D. 1931, the above named Walter H. Geier who acknowledged the signing of the foregoing to be his free act and deed for the uses and purposes therein mentioned. WITNESS my hand and official seal on the day and year last aforesaid. /s/ Harry S. Williams ---------------------------- Notary Public in and for HAMILTON County, Ohio, HARRY S. WILLIAMS Notary Public, Hamilton County, Ohio My Commission Express July 1, 1932 [ILLEGIBLE] If no amendment is proposed for any of the purposes hereafter in paragraphs 1, 2 or 3 of this section, then in addition to the affirmative vote required by the preceding paragraph, the amendment must be adopted by the affirmative vote of the [ILLEGIBLE] (or much larger [ILLEGIBLE] may permit or [ILLEGIBLE]) of each class [ILLEGIBLE] to voter [ILLEGIBLE] of [ILLEGIBLE] specified, regardless of [ILLEGIBLE] the voting power of [ILLEGIBLE], via: 1. If the purpose is: To [ILLEGIBLE] par value, or To change [ILLEGIBLE] shares with [ILLEGIBLE] par value from a different number of shares of the same class, or To change [ILLEGIBLE] shares of any class with or without par value [ILLEGIBLE] or a different number of shares of [ILLEGIBLE] with or without par value [ILLEGIBLE], or To change the [ILLEGIBLE] provisions of [ILLEGIBLE] substantially [ILLEGIBLE], then in any such [ILLEGIBLE] the holders of the issued shares of the [ILLEGIBLE] proposed to be changed by such amendment shall have the right to vote thereon. 2. If the purpose is to change the express [ILLEGIBLE] of issued shares of any class is any way [ILLEGIBLE] to the holders of any class of shares junior therein, then in any [ILLEGIBLE], the holders of the [ILLEGIBLE] shares of each junior class should have the right to vote thereon. 3. If any proposed amendment would substantially change the purpose or purposes of the organization, then the holders of shares of every class shall have the right to vote theron. Whenever it is proposed to change issued shares into a different number of shares of the same class, or to change issued shares into the same or a different number of shares of another class, shareholders or [ILLEGIBLE] specified, the amendment shall specify the number and class of shares as to be changed and the basis of the change. When by amendment issued shares of any class are changed into shares of another class, the amendment may, if desired, provide that the authorized [ILLEGIBLE] of the class [ILLEGIBLE], shall not be deemed to be reduced or affected by such change. If the purpose of the amendment is (a) to change the express terms and provisions of any outstanding shares having [ILLEGIBLE] dividend, redemption price or liquidation price over any other class of shares, or (b) substantially to change the purpose of purposes of a corporation, then in any such case, dissenting holders of shares of the class, the express terms and provisions of which [ILLEGIBLE], if substantially prejudiced by amendment, unless the articles otherwise provide or permit such amendment or change, or, in cases of such change of purpose or purposes dissenting shareholders of any class, shall, if substantially prejudiced thereby, be entitled to relief under the conditions and in the [ILLEGIBLE] hereinafter in this act provided. Upon the adoption of any amendment, a certificate containing a copy of the resolutions adopting such amendment and a statement of the manner of the adoption of such resolution should be filed in the office of the secretary of state and [ILLEGIBLE] the articles shall be deemed amended according to such resolution and any change of shares provided for therein shall become effective. In case of an amendment adopted by the incorporators such certificate shall be signed by each of them. In case of an amendment adopted by the director or shareholders the certificate shall be signed by the president or vice-president and the secretary or assistant secretary. In case of an amendment adopted by the board of directors to authorize shares to meet conversion [ILLEGIBLE] provided, the certificate of amendment shall also contain a statement describing the convertible securities and that prior to the adoption of such amendment the corporation did not have authorized a sufficient number of unissued shares to meet with conversion rights, if exercised. In case of an amendment adopted by the board of directors to authorize shares to meet options on [ILLEGIBLE] provided, the certificate of amendment shall also contain a statement showing how much [ILLEGIBLE] are evidenced the terms and provisions upon which they may be exercised and that prior to the adoption of such amendment the corporation did not have authorized a sufficient number of unissued shares to meet such options, if exercised. A copy of a certificate of amendment changing the name or principal office of a corporation certified by the secretary of state may be recorded in the office of the recorder of any county in this state, and for such recording a fee of five dollars shall be charged. If issued shares without par value are changed into the same or a different number of shares having par value, the aggregate par value of the shares into which the shares without par value are changed shall not exceed the amount of stated capital by such shares without par value, plus the amount of surplus then transferred to stated capital; nor be less than the amount of stated capital represented by such shares unless stated capital is concurrently reduced as hereafter in this not provided. If shares having par value are changed into shares without par value, the corporation shall be deemed to [ILLEGIBLE] for such shares without par value on as amount of consideration equal to the aggregate par value of the shares as changed and the stated capital of the [ILLEGIBLE] by shares without par value shall be increased by an amount equal to such aggregate par value unless stated capital is concurrently reduced. The stated capital of a corporation shall not be reduced except in the manner in this act provided. Upon the adoption of any amendment, a corporation may file amended articles in the office of the secretary of state in [ILLEGIBLE] of a certificate of amendment which authorized by the vote of the holders of shares entitling them to exercise two-thirds [ILLEGIBLE] proportion, not less than a majority, as the articles may permit or require of the voting power of the corporation on each [ILLEGIBLE]. The amended articles, which may differ from the theretofore excluding articles in the respects authorized by the resolution of amendment, shall contain a statement that they supercede and take the place of the theretofore of the existing articles of incorporation, and shall often contain all the statements required by this act to be included in original articles. In lieu of stating the amount of capital with which the corporation will begin business, the amended articles shall state the amount of its stated capital at the time of filing the amended articles. The president or vice president of the corporation and the secretary or an assistant secretary shall subscribe and acknowledge a certification [ILLEGIBLE] amended articles with each certificate shall be filed in the office of the secretary of state and thereupon the articles shall be deemed to be amended, and such amended articles shall [ILLEGIBLE] and take the place of the then existing articles of the corporation and all amendments thereto. A copy of such amended articles and the certificate thereto certified by the secretary of state shall be given [ILLEGIBLE] evidence of the [ILLEGIBLE] and performance of all antecedent acts and conditions necessary to the adoption of such amended articles and of the fact that they supercede and take the place of the then existing articles and all amendments thereto and of the [ILLEGIBLE] to such amended articles. Upon such filing the secretary of state shall change the [ILLEGIBLE] from the would be changed upon the filing of a certificate of amendment [ILLEGIBLE] the amendments [ILLEGIBLE] by such filing. 229 Line 19 Number 147231 Form AMDT. For Profit. AMENDMENT OF Cincinnati Milling Machine Cincinnati Grinders, Inc. In the office of the Secretary of State. [ILLEGIBLE] Ohio on the 16 day of Sept. 1931 and recorded Volume [ILLEGIBLE] Page [ILLEGIBLE] Articles of incorporation /s/ [ILLEGIBLE] --------------- Secretary of State N.B. If amended Articles are [ILLEGIBLE] must be acknowledged. CERTIFICATE FOR FILING [ILLEGIBLE] AMENDED ARTICLES OF INCORPORATION OF Cincinnati Milling Machine and Cincinnati Grinders Incorporated with its principal office located at Cincinnati, Hamilton County, Ohio, do hereby certify that a meeting of the holders of the shares of said corporation entitling them to vote on the proposal to adopt the Amended Articles as contained in the following resolution was duly called and held on the 14th day of September, 1931, at which meeting a quorum of such shareholders* was present in person or by proxy, and that by the affirmative vote of the holders of shares entitling them to [ILLEGIBLE] two-thirds, vis. all of the voting power of the corporation on such proposal* the following resolution of amendment was adopted: "RESOLVED, That the following articles of incorporation of this company be and they are hereby amended so as to change the name of the corporation to CINCINNATI MILLING MACHINE AND CINCINNATI GRINDERS INCORPORATED." * Strike out matter in parenthesis if not necessary. Sec. 8623-15 *** 1. Before any subscription to shares *** shall have been reviewed by the Incorporation, and amendment or amended articles may be adopted in [ILLEGIBLE] signed by all of the incorporators. 2. After *** any subscription to shares shall have been [ILLEGIBLE], *** an amendment may be adopted by the board of directors in the following cases only: a. When so authorized by the articles, the board of directors may adopt an amendment, in respect *** of any unissued or treasury shares of any class ***, to fix or alter the division of such shares into series, the designation and number of shares of each series, the dividend rate, dates of payment of dividends and dates from which they are cumulative, redemption rights and price, liquidation price, sinking fund requirements, conversion rights, and restrictions on issuance of shares of the same series or of any other class of series. b. ***When the corporation shall have issued shares or any other securities convertible into shares of the corporation, or shall have granted options to purchase any shares as in this act provided, and such conversion or option rights are set forth in the articles or shall have been approved by the same vote of shareholders as, at the time of such approval, would have been required to amend the articles to authorize the shares required for such purpose, and the corporation in any such case shall not have sufficient authorized but un-issued shares to [ILLEGIBLE] such conversion or option rights, then an amendment to authorize such shares may be adopted by the board of directors. 3. After *** any subscription to shares shall have been received, any amendment (including any that could be adopted by the board of directors as hereinbefore provided) may be adopted, at a meeting of shareholders *** called for such purpose, by the affirmative vote of the holders of shares entitled under the articles to exercise at least two-thirds of the voting power of the corporation on such proposal, (or if the articles so provide or permit, a greater or lesser proportion but not less than a majority if such voting power), and by such vote of the holders of any particular class or classes of shares as may be required by the articles and the provisions, when applicable, of subdivision (4) hereof. Whenever under said subdivision (4) any class of shares is entitled to vote on an amendment to vote on an amendment, such amended must receive the affirmative vote of the holders of at least two-thirds (or if the articles so provide or permit, a greater or lesser proportion but not less than a majority) of the shares of each class. If the proposed amendment would authorize any particular corporate action which, under any other section of this act or the existing articles, could be authorized or done only by or pursuant to a specified vote of shareholders, then such amendment must be adopted by a vote not less than the vote so specified. ***4. Regardless of limitations or restrictions in the articles on the voting rights of any class, the holders of the shares of a particular class (and in case specified in clause (f) below, the holders of the shares of every class) shall be entitled to vote as a class upon a proposed amendment which would a. increase or reduce the par value of the issued shares of that class or b. change any issued shares of that class into a different number of shares of the same class or into the same or a different number of shares of any class or classes, with or without par value, theretofore or then authorized, or c. to change the express [ILLEGIBLE] class in any manner [ILLEGIBLE]; or d. change the [ILLEGIBLE] shares of any class senior to the [ILLEGIBLE] substantially prejudicial to the holders [ILLEGIBLE] e. authorize the conversion of shares of another class into shares of each particular class, or authorize the board of directors to fix or alter rights to convert shares of another class into shares of such particular class; or f. substantially change the purposes of the corporation. 5. An amendment which changes issued shares into a different number of shares of the same class or into the same or different number of shares of any class or classes shall specify the number and class of shares so changed and the number of shares of the same class or classes into which they are changed. 6. In lieu of or in addition to adopting an amendment or amendments to the articles, the shareholders may adopt amended articles by the same vote as that hereinbefore. Amended articles may also be adopted to consolidate the required to effect the desired changes in the articles, provisions of the original articles and of all previously adopted amendments to the articles that are in force at the time, by the affirmative vote of the holders of shares entitled under the articles to exercise a majority of the voting power of the corporation. Amended articles shall contain all statements required by this act to be included in original articles, (provided that in lieu of stating the amount of capital with which the corporation will begin business, the amended articles shall state the amount of its stated capital at the time of adopting the amended articles) and the statements required by sub-division (5) above, and a statement that they supercede and take the place of the theretofore existing articles. 7. Upon the adoption of any amendment or amended articles, a certificate containing a copy of the resolution adopting such amendment or amended articles and a statement of the manner of *** its adoption shall be filed in the office of the secretary of state, and thereupon the articles shall be *** amended *** accordingly and say change of shares provided for therein shall become effective, and such amended articles shall supercede and take the place of the then existing articles of the corporation and all amendment thereto. In case of an amendment or amended articles adopted by the incorporators, such certificate shall be signed by each of them. In case of an amendment adopted by the directors or an amendment or amended articles adopted by the shareholders, the certificate shall be signed by the president or vice president and the secretary or assistant secretary. *** 8. A copy of *** an amendment or amended articles changing the name or principal office of a corporation certified by the secretary of state may be recorded in the office of the recorder of any county in this state, and for such recording fee of five dollars shall be charged. *** 9. An amendment or amended articles, when adopted in the manner prescribed in this section, shall in the absence of clear and convincing proof of the contrary be presumed to be fair and equitable in every respect to all shareholders. [ILLEGIBLE] AMENDED ARTICLES OF INCORPORATION FIRST: The name of the corporation is CINCINNATI MILLING AND GRINDING MACHINES, INC. SECOND: The place in the State of Ohio where its principal office is located in the City of Cincinnati, Hamilton County. THIRD: The purpose of the corporation are as follows: To buy, manufacture or otherwise acquire, own hold, sell or otherwise dispose of, trade and otherwise deal in, machinery, machine tools, accessories, tools, supplies, parts, materials, goods, wares, merchandise and personal property of all kinds, both tangible and intangible; To acquire by purchase, application or otherwise, own, hold, sell or otherwise dispose of or otherwise deal in, develop and perfect inventions, processes, methods, patents, applications, patent rights and privileges, copy rights, trade marks, and trade names, or any rights, options or contracts of similar nature or relating thereto or connected therewith; To acquire, own, hold, and dispose of such real estate or interests in real estate as shall be necessary, convenient, or expedient to accomplish any of said purposes; To do all such further acts as are necessary, convenient, or expedient to accomplish the above purposes; The enumeration of the above purposes in these Articles of Incorporation, shall not be held to limit or restrict in any manner the general powers of the corporation and it shall have all capacity permitted by law. B676 1148 RECEIPT AND CERTIFICATE NO. 8451 CINCINNATI MILACRON COMPANY formerly CINCINNATI MILLING AND GRINDING MACHINES, INC. ------------------------------------------------------------------- NAME 147731 ------ NUMBER DOMESTIC CORPORATION MISCELLANEOUS FILINGS ARTICLES OF INCORPORATION ANNEXATION/INCORPORATION-CITY AMENDMENT OR VILLAGE MERGER/DELETED RESERVATION OF CORPORATE NAMES DISSOLUTION REGISTRATION OF NAME AGENT REGISTRATION OF NAME RENEWALS RE-INSTATEMENT REGISTRATION OF NAME - CHANGE CERTIFICATES OF CONTINUED OF REGISTRANTS ADDRESS EXISTENCE TRADE MARK MISCELLANEOUS TRADE MARK RENEWAL SERVICE MARK FOREIGN CORPORATIONS SERVICE MARK RENEWAL LICENSE MARK OF OWNERSHIP AMENDMENT MARK OF OWNERSHIP RENEWAL SURRENDER OF LICENSE EQUIPMENT CONTRACT/CHATTEL APPOINTMENT OF AGENT MORTGAGE CHANGE OF ADDRESS OF AGENT POWER OF ATTORNEY CHANGE OF PRINCIPAL OFFICE SERVICE OF PROCESS RE-INSTATEMENT MISCELLANEOUS FORM 7 ASSIGNMENT - TRADE MARK, MARK PENALTY OF OWNERSHIP, SERVICE MARK, REGISTRATION OF NAME I certify that the attached document was received and filed in the office of TED W. BROWN, Secretary of State, at Columbus, Ohio, on the 1st day of May A.D. 1970, and recorded on Roll B676 at Frame 1148 of the RECORDS OF INCORPORATION and MISCELLANEOUS FILINGS. /s/ Ted W. Brown ----------------- TED W. BROWN, Secretary of State Filed by and Returned To: Cincinnati Milacron Inc. 4701 Marburg Avenue Cincinnati, Ohio 45209 Att: Raymond G. Wilson FEE RECEIVED: $ 25.00 NAME: CINCINNATI MILACRON COMPANY formerly CINCINNATI MILLING AND GRINDING MACHINES, INC. B676 1149 147731 APPROVED BY [ILLEGIBLE] Date 5-1-70 Amount 25.00 CERTIFICATE OF MERGER OF CINCINNATI LATHE AND TOOL CO. AND CINCINNATI MILLING AND GRINDING MACHINES, INC. The undersigned, president and secretary of Cincinnati Lathe and Tool Co., and president and secretary of Cincinnati Milling and Grinding Machines, Inc., do hereby certify that the following is a signed agreement of merger adopted by each of said corporations in the manner set forth below: B676 1150 AGREEMENT OF MERGER OF CINCINNATI LATHE AND TOOL CO. AND CINCINNATI MILLING AND GRINDING MACHINES, INC. This agreement made this 22nd day of April, 1970 between Cincinnati Lathe and Tool Co., an Ohio corporation, whose principal office is at 4701 Marburg Ave., Cincinnati, Ohio (hereinafter called "CLT"), and Cincinnati Milling and Grinding Machines, Inc., an Ohio corporation, whose principal office is at 4701 Marburg Ave., Cincinnati, Ohio (hereinafter called "CM"), said corporations being together hereinafter sometimes called the "constituent corporations". The Articles of Incorporation of CLT were filed in the office of the Secretary of State of Ohio on November 5, 1945, No. 191326, recorded in Volume 506 at page 41 of the Records of Incorporation in said office with a par value of one hundred dollars ($100) each, of which one thousand shares are now outstanding. The Amended Articles of Incorporation of CM were filed in the office of the Secretary of State of Ohio on April 25, 1942, No. 147731, recorded in Volume 4836 at page 699 of the Records of Incorporation in said office. CM is authorized to issue two hundred fifty (250) common shares with a par value of one hundred dollars ($100) each, of which two hundred fifty shares are now outstanding. The respective boards of directors of the constituent corporations deem it advisable that the constituent corporations be merged under the General Corporation Law of Ohio, and all of the members of the respective boards of directors have approved this agreement without meetings of the Boards, in writings approved and signed as specified in Section 1701.54 of the Ohio Revised Code. Now, therefore, in consideration of the premises and of the agreement herein contained, the constituent corporations do hereby agree that CLT be merged and into CM, hereinafter sometimes called the "Surviving Corporation"; and that the terms and conditions of the merger, the mode of carrying it into effect, and the manner and basis of converting the shares of the constituent corporations to shares of the Surviving Corporation are, and shall be as follows: FIRST. The name of the Surviving Corporation shall be "Cincinnati Milacron Company". SECOND. The place in the State of Ohio where the principal office of the Surviving Corporation is to be located is Hamilton County, Ohio. - 2 - B676 1151 THIRD. The purpose or purposes for which the Surviving Corporation is formed are: To manufacture, buy or otherwise acquire, own, hold, sell or otherwise dispose of, trade and otherwise deal in, machinery, machine tools, accessories, tools, supplies, parts, materials, goods, wares, merchandise and personal property of all kinds, both tangible; and intangible; To acquire by purchase, application or otherwise, own, hold, sell or otherwise dispose of or otherwise deal in, develop and perfect inventions, processes, methods, patents, applications, patent rights and privileges, copyrights, trade marks and trade names, or any rights, options or contracts of similar nature or relating thereto or connected therewith; To acquire, own, hold and dispose of such real estate or interests in real estate as shall be necessary, convenient or expedient to accomplish any of said purposes; To do all such further acts as are necessary, convenient or expedient to accomplish the above purposes; The enteration of the above purposes in these Articles of Incorporation, shall not be held to limit or restrict in any manner the general powers of the corporation and it shall have all capacity permitted by law. FOURTH. The authorized number of common shares of the Surviving Corporation is one thousand two hundred fifty (1,250), all of which shall be with a par value of one thousand dollars ($1,000) each. FIFTH. At the effective date of the merger the amount of stated capital of each class of shares to be outstanding is one million two hundred fifty thousand dollars ($1,250,000.). - 3 - B676 1152 SIXTH. The amount of the earned surplus of said surviving corporation shall be the lesser of (a) the excess, if any, of the assets of the surviving corporation, taken at their fair value to the surviving corporation, over the sum of its liabilities, including liabilities derived from the constituent corporations or resulting from the merger, and stated capital, and (b) the combined earned surplus of the constituent corporations diminished by the deficit of any constituent corporation. SEVENTH. The names of the first directors of the Surviving Corporation and their addresses are as follows: W. K. Mathias 6605 Pleasant Street, Cincinnati, Ohio 45227 P. O. Geier, Jr. 6000 Redbirdhollow Lane, Cincinnati, Ohio 45243 W. P. Clark 8592 Sturbridge Drive, Cincinnati, Ohio 45213 C. H. Altbaier 6500 Ridge Circle, Cincinnati, Ohio 45213 M. W. Gormly 7330 Miami Hills Drive, Cincinnati, Ohio 45243 R. C. Messinger 7360 Algonquin Drive, Cincinnati, Ohio 45243 F. V. Geier 8880 Old Indian Hill Road, Cincinnati, Ohio 45243 A. T. Blackburn 6825 Buttonwood Court, Cincinnati, Ohio 45230 J. A. D. Geier 9100 Kugler Mill Road, Cincinnati, Ohio 45243 R. C. Bevis 9125 Cunningham, Cincinnati, Ohio 45243 W. F. Mericle 310 Compton Hills Drive, Cincinnati, Ohio 45215 C. R. Meyer 8075 Remington Road, Cincinnati, Ohio 45242 H. V. Edwards 6250 Shadyglen Road, Cincinnati, Ohio 45243 L. H. Cousineau 8175 Brill Road, Cincinnati, Ohio 45243 EIGHTH. The names of the first officers of the Surviving Corporation and their respective offices and addresses are as follows: Chairman of the Board W. K. Mathias 6605 Pleasant St., Cincinnati, Ohio President P. O. Geier, Jr. 6000 Redbirdhollow Lane, Cincinnati, O. Vice President W. P. Clark 8592 Sturbridge Drive, Cincinnati, O. do C. H. Altbaier 6500 Ridge Circle, Cincinnati, O. do M. W. Gormly 7330 Miami Hills Drive, Cincinnati, O. do C. R. Eby 8055 S. Clippinger Drive, Cincinnati, O. do P. J. Gruber 7955 Chinquapin Lane, Cincinnati, O. - 4 - B676 1153 do R. T. Clendening 8778 Sturbridge Drive, Cincinnati, O. do L. A. Dever 5573 Mapleridge Drive, Cincinnati, O. do R. C. Messinger 7360 Algonquin Drive, Cincinnati, O. do E. F. Schloss 7737 Heighgate Place, Cincinnati, O. do W. F. Mericle 310 Compton Hills Drive, Cincinnati, O. Treasurer L. H. Cousineau 8175 Brill Road, Cincinnati, O. Secretary and Assistant Treasurer Sam Redrow, Jr. 8950 Old Indian Hill and Statutory Agent Road, Cincinnati, O. Assistant Treasurer J. A. Steen 3805 Miami, Cincinnati, O. Assistant Secretory R. J. Hans 10360 Lochcrest Drive, Cincinnati, O. Comptroller N. J. Elmore 1387 Thomwood Drive, Cincinnati, O. Cashier R. A. Whistler 4105 Pillars Drive Cincinnati, O. NINTH. The present Regulations of CM, one of the constituent corporations, shall be the Regulations of the Surviving Corporation until changed or repealed according to the provisions thereof. TENTH. The mode of carrying into effect the merger and the manner and basis of converting the shares of the constituent corporations to shares of the Surviving Corporation shall be as follows: Each outstanding share of CLT shall be and hereby is converted into one fully paid and non assessable share of the Surviving Corporation. Each outstanding share of CM shall be and hereby is converted into one fully paid and non assessable share of the Surviving Corporation. ELEVENTH. The merger herein provided shall become effective on May 1, 1970. In Witness whereof, the Constituent Corporations have caused this agreement to be signed in their respective corporate names and their corporate seals to be affixed hereto by their respective - 5 - B676 1154 president and secretaries, thereunto duly authorized by their respective Boards of Directors and shareholders. Cincinnati Lathe and Tool Co. by /s/ W. H. Bentley -------------------------------------- W. H. Bentley, President /s/ R. J. Hans (Seal) -------------------------------------- Attest: R. J. Hans, Secretary /s/ R. J. Hans Cincinnati Milling and Grinding - --------------------- Machines, Inc. R. J. Hans, Secretary by /s/ P. O. Geier ------------------------------ P. O. Geier, Jr., President /s/ Sam Redrow (Seal) -------------------------------- Attest: Sam Redrow, Jr., Secretary /s/ Sam Redrow - ------------------------- Sam Redrow, Jr. Secretary - 6 - B676 1155 The undersigned, president and secretary of Cincinnati Lathe and Tool Company, one of the corporations which executed the forgoing agreement of merger, hereby certify that, at a meeting of the shareholders said corporation, duly called for such purpose, and notice whereof was given to all shareholders of said corporation, whether or not entitled to vote, accompanied by a copy of summary of the agreement, and which meeting was held on the 22nd day of April, 1970, at which meeting quorum of such shareholders was present in person or by proxy, said agreement of merger was adopted by the affirmative vote of the holders of shares of said corporation entitling them to exercise at least two-thirds of the voting power of said corporation. The undersigned, president and secretary of Cincinnati Milling and Grinding Machines, Inc., one of the corporations which executed the foregoing agreement of merger, hereby certify that, at a meeting of the shareholders of said corporations, duly called for such purpose, and notice whereof was given to all shareholders of said corporation, whether or not entitled to vote, accompanied by a copy or summary or the agreement, and which meeting was held on the 22nd day of April, 1970, at which meeting a quorum of such shareholders was present in person or by proxy, said agreement or merger was adopted by the affirmative vote of the holders of shares of said corporation - 7 - B676 1156 entitling them to exercise at least two-thirds of the voting power of said corporation. In Witness whereof, the undersigned have hereunto set their hands and the seals of said corporations respectively at Cincinnati, Ohio this 22nd day of April, 1970. /s/ W. H. Bentley --------------------------------------- (Seal) W. H. Bentley, President of Cincinnati Lathe Attest: and Tool Company /s/ R. J. Hans /s/ R. J. Hans - ----------------------------- --------------------------- R. J. Hans, Secretary R. J. Hans, Secretary of Cincinnati Lathe and Tool Company /s/ P. O. Geier, Jr. ---------------------------------- (Seal) P. O. Geier, Jr., President of Cincinnati Attest: Milling and Grinding Machines, Inc. /s/ Sam Redrow Jr. /s/ Sam Redrow - ------------------ ----------------------------------- Sam Redrow, Jr. Sam Redrow Jr., Secretary of Cincinnati Secretary Milling and Grinding Machines, Inc. B0933-1615 THE STATE OF OHIO [LOGO] DEPARTMENT OF STATE TED W. BROWN SECRETARY OF STATE CERTIFICATE It is hereby certified that the Secretary of State of Ohio has custody of the Records of Incorporation and Miscellaneous Filings; that said records show the filing and recording of: MER INC. of CINCINNATI MILACRON COMPANY. United States of America Recorded on Roll B933 at Frame STATE OF OHIO 1614 of the Records of Office of the Secretary of State Incorporation and Miscellaneous Filings. [SEAL] Witness my hand and the Seal of the Secretary of State, at the City of Columbus, Ohio, this 26TH day of DECEMBER, A.D. 1973 /s/ Ted W. Brown ---------------------------- Secretary of State B0933-166 147731 APPROVED By /s/ [ILLEGIBLE] Date 12/27/73 Payment [ILLEGIBLE] CERTIFICATE OF MERGER OF CINCINNATI MILACRON PM COMPANY INTO CINCINNATI MILACRON COMPANY The Agreement of Merger to which the Certificate is attached having been approved by the directors of the respective corporations thereto in accordance with the requirements of Title 17, Chapter 1701 of the Revised Code of Ohio, and having been adopted separately by the shareholders of each corporate party thereto, as to the said Cincinnati Milacron Company in accordance with the requirements of the provisions of Title 17, Chapter 1701 of the Revised Code of Ohio and as to said Cincinnati Milacron PM Company in accordance with the requirements of the corporation law of the State of Florida, and that fact having been certified to by the undersigned officers of the respective parties to the Agreement of Merger, the said officers do therefor sign this certificate of merger, pursuant to Section 1701.81 of the Revised Code of Ohio. /s/ James A. D. Geier ---------------------------------- James A. D. Geier, President of CINCINNATI MILACRON COMPANY /s/ Robert J. Hans ---------------------------------- Robert J. Hans, Secretary of CINCINNATI MILACRON COMPANY /s/ William Mericle ---------------------------------- William Mericle, President of CINCINNATI MILACRON PM COMPANY /s/ Robert J. Hans ---------------------------------- Robert J. Hans, Secretary of CINCINNATI MILACRON PM COMPANY AGREEMENT OF MERGER MERGING CINCINNATI MILACRON PM COMPANY A corporation of the State of Florida INTO CINCINNATI MILACRON COMPANY A corporation of the State of Ohio AGREEMENT OF MERGER, dated this 20th day of December, 1973, made by and between CINCINNATI MILACRON COMPANY, a corporation organized and existing under the laws of the State of Ohio, and CINCINNATI MILACRON PM COMPANY, a corporation organized and existing under and by virtue of the laws of the State of Florida. WITNESSETH that: WHEREAS the board of directors of each of said corporations, parties hereto, to the end that greater efficiency and economy in the management of the business carried on by each corporation may be accomplished and in consideration of the mutual agreements of each corporation as set forth herein, do deem it advisable and generally to the advantage and welfare of said corporations and their respective shareholders that Cincinnati Milacron PM Company be merged into Cincinnati Milacron Company and WHEREAS, said Cincinnati Milacron Company was incorporated by the filing of articles of incorporation in the office of the Secretary of State of Ohio on the 25th day of April, 1942, and the maximum number of shares which said corporation is authorized by its articles of incorporation to issue is One Thousand Two Hundred Fifty (1,250) shares of the par value of One Thousand Dollars ($1,000) each, which are common stock, of which One Thousand Two Hundred Fifty (1,250) shares of such common stock are now issued and outstanding and WHEREAS, said Cincinnati Milacron PM Company by its certificate of incorporation which was filed in the office of the Secretary of State of Florida on February 18, 1966, has an authorized capital stock consisting of Ten Thousand (10,000) shares of common stock with a par value of One Dollar ($1.00) each, of which Ten Thousand (10,000) shares of such common stock are now issued and outstanding, and WHEREAS, the provisions of Title 17, Chapter 1701 of the Revised Code of Ohio, authorizes the merger of corporations organized under the laws of other states into a corporation organized under the said Laws of Ohio, and the Corporation Law of Florida, authorizes the merger of a corporation organized under the laws of the State of Florida, into a corporation organized under the laws of another State. NOW, THEREFORE, the corporations, parties to this agreement, have agreed and do hereby agree as follows: FIRST: Cincinnati Milacron PM Company, organized and existing under the laws of the State of Florida, shall be and hereby is merged into Cincinnati Milacron Company, organized and existing under the laws of Ohio, and said Cincinnati Milacron Company hereby merges into itself said Cincinnati Milacron PM Company; said Cincinnati Milacron Company shall be the continuing and surviving corporation (hereinafter in this agreement referred to as the "surviving corporation") and shall be governed by the Corporation Law of the State of Ohio. SECOND: The name of the said surviving corporation is and shall be Cincinnati Milacron Company. THIRD: The place in Ohio where the principal office of said surviving corporation is to be located is 4701 Marburg Avenue, in the City of Cincinnati, 46209, County of Hamilton. FOURTH: The purposes of the said surviving corporation are and shall be: To manufacture, buy or otherwise acquire, own, hold, sell, or otherwise dispose of, trade and otherwise deal in, machinery, machine tools, accessories, tools, supplies, parts, materials, goods, wares, merchandise and personal property of all kinds, both tangible; and intangible; To acquire by purchase, application or otherwise, own, hold, sell or otherwise dispose of or otherwise deal in, develop and perfect inventions, processes, methods, patents, applications, patent rights and privileges, copyrights, trade marks and trade names, or any rights, options or contracts of similar nature or relating thereto or connected therewith; To acquire, own, hold and dispose of such real estate or interests in real estate as shall be necessary, convenient or expedient to accomplish any of said purposes; To do all such further acts as are necessary, convenient or expedient to accomplish the above purposes; The enumeration of the above purposes in these Articles of Incorporation, shall not be held to limit or restrict in any manner the general powers of the corporation and it shall have all capacity permitted by law. FIFTH: That the maximum number of shares which said surviving corporation shall be authorized to have outstanding is Two Thousand (2,000) all of which shall be a par value of One Thousand Dollars ($1,000) each. SIXTH: The directors of the surviving corporation shall continue in office until the next annual meeting of shareholders and until their successors shall have been elected and qualified. SEVENTH: The regulations of the surviving corporation shall be the present regulations of Cincinnati Milacron Company. EIGHTH: Robert J. Hans of 10360 Lochcrest Drive, Cincinnati, Ohio in Hamilton County, Ohio, is hereby appointed as agent on which process, notices and demands against any constituent corporation or surviving corporation may be served. NINTH: The manner and basis of making distribution to the shareholders of Cincinnati Milacron PM Company, which is by this agreement of merger merged into Cincinnati Milacron Company, of shares of said surviving corporation, shall be as follows: Each holder of one share of common stock of said Cincinnati Milacron PM Company, upon surrender of the certificate therefor at the office of the surviving corporation, duly endorsed in blank for transfer, shall receive .075 shares of common stock, with a par value of One Thousand Dollars ($1.000) of the surviving corporation. TENTH: Upon the date when this agreement shall become effective, the separate existence of Cincinnati Milacron PM Company shall cease and the said Cincinnati Milacron PM Company shall be merged into the surviving corporation in accordance with this agreement of merger. The surviving corporation shall be possessed of all assets and property of every description, and every interest therein, wherever located, and the rights, privileges, immunities, powers, franchises, and authority, of a public as well as of a private nature, of each of the constituent corporations, and all obligations belonging to or due to each of the constituent corporations, all of which shall be vested in the surviving corporation without further act or deed. Title to any real estate or any interest therein vested in any constituent corporation shall not revert or in any way be impaired by reason of such merger or consolidation; The surviving corporation shall be liable for all the obligations of each constituent corporation, including liability to dissenting shareholders; All the rights of creditors of each constituent corporation are preserved unimpaired, and all liens upon the property of any constituent corporation are preserved unimpaired, on only the property affected by such liens immediately prior to the effective date of the merger or consolidation. ELEVENTH: Anything herein or elsewhere to the contrary notwithstanding, this agreement of merger may be abandoned by either party, by appropriate resolution of its board of directors, at any time prior to the filing of this agreement or by mutual consent of the parties by appropriate resolution of their respective board of directors, at any time prior to the effective date of this merger. THIRTEENTH: The merger shall become effective on the 30th day of December, 1973. IN WITNESS WHEREOF, the parties of this agreement, have caused this agreement to be executed by the president and the secretary of each of the corporations under the corporate seals of the respective corporations, by authority of the directors and shareholders of each corporation, as the respective agreement of each of said corporations, on this 20th day of December, 1973. CINCINNATI MILACRON COMPANY /s/ James A. D. Geier ---------------------------- (Corporate Seal) James A. D. Geier, President Attest: /s/ Raymond G. Wilson /s/ Robert J. Hans - ---------------------- ---------------------------- Raymond G. Wilson, Robert J. Hans, Secretary Assistant Secretary CINCINNATI MILACRON PM COMPANY /s/ William Mericle (Corporate Seal) --------------------------- William Mericle, President Attest: /s/ Raymond G. Wilson /s/ Robert J. Hans - ----------------------- -------------------------- Raymond G. Wilson, Robert J. Hans, Secretary Assistant Secretary CERTIFICATE OF PRESIDENT AND SECRETARY OF CINCINNATI MILACRON COMPANY THE SURVIVING CORPORATION, A CORPORATION OF THE STATE OF OHIO SHOWING APPROVAL OF AGREEMENT OF MERGER James A. D. Geier, President, and Robert J. Hans, Secretary, of Cincinnati Milacron Company, an Ohio corporation, do hereby certify, as President and Secretary of said corporation, that the Agreement of Merger to which this certificate is attached, having been first duly approved on behalf of Cincinnati Milacron Company, a corporation of the State of Ohio, by a majority of the board of directors of said corporation and approved by resolution of the board of directors of Cincinnati Milacron PM Company, a corporation of the State of Florida, was duly submitted to the shareholders of Cincinnati Milacron Company at a special meeting of said shareholders, called separately from the meeting of the shareholders of any other corporation, for the purpose of considering and approving or rejecting said Agreement of Merger and held upon due notice accompanied by a summary or copy of said agreement given to the sole shareholder of said corporation, on the 20th day of December, 1973, and that said Agreement of Merger was adopted by the vote of the sole holder of all issued and outstanding shares of said corporation entitling it to exercise at least two-thirds of the voting power of such corporation; whereupon said Agreement of Merger was duly adopted as the act of said corporation. IN WITNESS WHEREOF, James A. D. Geier, President, and Robert J. Hans, Secretary, acting for and on behalf of said corporation, have hereunto subscribed their names and caused the seal of said corporation to be hereunto affixed this 20th day of December, 1973. /s/ James A. D. Geier ---------------------------- James A. D. Geier, President Attest: /s/ Raymond G. Wilson /s/ Robert J. Hans - ------------------------ --------------------------- Raymond G. Wilson, Robert J. Hans, Secretary Assistant Secretary CERTIFICATE OF PRESIDENT AND SECRETARY OF CINCINNATI MILACRON PM COMPANY THE MERGING CORPORATION, A CORPORATION OF THE STATE OF FLORIDA. SHOWING APPROVAL OF AGREEMENT OF MERGER William Mericle, President, and Robert J. Hans, Secretary, of Cincinnati Milacron PM Company, a corporation organized and existing under the laws of the State of Florida, do hereby certify as such officers that the Agreement of Merger to which this Certificate is attached, after having been first duly approved on behalf of the said corporation by majority of the directors thereof, as required by the provisions of the Corporation Law of Florida, was duly submitted to the sole shareholders of said Cincinnati Milacron PM Company at a special meeting of shareholders called and held separately from the meeting of shareholders of any other corporation, after waiver of notice of meeting signed by the sole shareholder, as provided by the Corporation Law of Florida, on the 20th day of December, 1973 for the purpose of considering and taking action upon the proposed Agreement of Merger; that Ten Thousand (10,000) shares of stock or said corporation were on said day issuing and outstanding, that the holder of Ten Thousand (10,000) shares voted in favor of the approval, the said affirmative vote representing at least two-thirds of the total number of shares of the outstanding capital stock of said corporation, and thereby the Agreement of Merger was at said meeting duly adopted as the act of the shareholder of said Cincinnati Milacron PM Company as the duly adopted Agreement of the said corporation. IN WITNESS WHEREOF, William Mericle, President, and Robert J. Hans, Secretary, acting for and on behalf of said corporation, have hereunto subscribed their names and caused the seal of said corporation to be hereunto affixed this 20th day of December, 1973. /s/ William Mericle ---------------------------- William Mericle, President Attest: /s/ Raymond G. Wilson /s/ Robert J. Hans - ------------------------ --------------------------- Raymond G. Wilson, Robert J. Hans, Secretary Assistant Secretary CERTIFICATE OF AMENDMENT TO ARTICLES OF CINCINNATI MILACRON COMPANY James A. D. Geier, President, Robert J. Hans, Secretary, of Cincinnati Milacron Company, an Ohio corporation, with its principal office located at Cincinnati, Ohio, do hereby certify that the sole shareholder of all of the shares of said corporation did authorize, consent and agree by unanimous written consent to the adoption without a meeting of the following resolution: RESOLVED that the Articles of Incorporation of this corporation be amended by changing the Article thereof numbered "FIRST" so that, as amended, said Article shall be and read as follows: "FIRST: The name of the corporation (hereinafter called the Company) is Cincinnati Milacron Marketing Company." IN WITNESS WHEREOF, said James A. D. Geier, President, and Robert J. Hans, Secretary, of Cincinnati Milacron Company acting for and on behalf of said corporation, have hereunto subscribed their names and caused the seal of said corporation to be hereunto affixed this 8th day of July, 1980. CINCINNATI MILACRON COMPANY BY /s/ James A. D. Geier ---------------------- James A. D. Geier, President BY /s/ Robert J. Hans ------------------- Robert J. Hans, Secretary Page 3 CERTIFICATE OF AMENDMENT BY SHAREHOLDERS TO THE ARTICLES OF INCORPORATION OF CINCINNATI MILACRON MARKETING COMPANY - ----------------------------------------------------------------------------- (Name of Corporation) Daniel J. Meyer, who is: [X] Chairman of the Board [ ] President [ ] Vice President (check one) and Wayne F. Taylor, who is: [X] Secretary [ ] Assistant Secretary (Check one) of the above named Ohio corporation for profit do hereby certify that; (check the appropriate box and complete the appropriate statements) [ ] a meeting of the shareholders was duly called for the purpose of adopting this amendment and held on ___________________, 19___ at which meeting a quorum of the shareholders was present in person or by proxy, and by the affirmative vote of the holders of shares entitling them to exercise __________% of the voting power of the corporation. [X] in a writing signed by all of the shareholders who would be entitled to notice of a meeting held for that purpose, the following resolution to amend the articles was adopted: THE NAME OF THE COMPANY IS NOW MILACRON MARKETING COMPANY IN WITNESS WHEREOF, the above named officers, acting for and on the behalf of the corporation, have thereto subscribed their names this 9 day of October, 1998. By /s/ Daniel J. Meyer -------------------------------------- Daniel J. Meyer, Chairman of the Board By /s/ Wayne F. Taylor -------------------------------------- Wayne F. Taylor, Secretary NOTE: Ohio law does not permit one officer to sign in two capacities. Two separate signatures are required, even if this necessitates the election of a second officer before the filing can be made. [OHIO-613-3/4/91] Page 1 EX-3.6 4 y98028exv3w6.txt CODE OF REGULATIONS EXHIBIT 3.6 Amended 11/26/92 CODE OF REGULATIONS OF CINCINNATI MILACRON MARKETING COMPANY Article I. MEETINGS OF SHAREHOLDERS (a) Annual Meetings. The annual meeting of the shareholders of this corporation shall be held at the principal office of the corporation, in Cincinnati, Ohio, on the fourth Wednesday in April of each year, at 11:45 o'clock A.M., if not a legal holiday, but if a legal holiday, then on the day following at the same hour. The first annual meeting of the corporation shall be held in 1932. (b) Special meetings of the shareholders of this corporation shall be called by the Secretary, pursuant to a resolution of the Board of Directors, or upon the written request of two directors, or by shareholders representing 25% of the shares issued and entitled to vote. Calls for special meetings shall specify the time, place and object or objects thereof, and no business other than that specified in the call therefor shall be considered at any such meetings. (c) Notice of Meetings. A written or printed notice of the annual or any special meeting of the shareholders, stating the time and place, and in case of special meetings, the objects thereof, shall be given to each share- holder entitled to vote at such meeting appearing on the books of the corp- oration, by mailing same to his address as the same appears on the records of the corporation or of its Transfer Agent, or Agents, at least five (5) days before any such meeting; provided, however, that no failure or irregularity of notice of any annual meeting shall invalidate the same or any proceeding thereat. All notices with respect to any shares to which persons are jointly entitled may be given to that one of such persons who is named first upon the books of the Corporation and notice so given shall be sufficient notice to all the holders of such shares. (d) Quorum. A majority in number of the shares authorized, issued and outstanding, represented by the holders of record thereof, in person or by proxy, shall be requisite to constitute a quorum at any meeting of shareholders, but less than such majority may adjourn the meeting of shareholders from time to time and at any such adjourned meeting any business may be transacted which might have been transacted if the meeting had been as originally called. (e) Proxies. Any shareholder entitled to vote at a meeting of shareholders may be represented and vote thereat by proxy appointed by an instrument in writing, subscribed by each shareholder, or by his duly authorized attorney, and submitted to the Secretary at or before such meeting. Article II. SEAL The seal of the corporation shall be circular, about two inches in diameter, with the name of the corporation engraved around the margin and the word "SEAL" engraved across the center. It shall remain in the custody of the Secretary, and it or a facsimile thereof shall be affixed to all certificates of the corporations's shares. If deemed advisable by the Board of Directors, a duplicate seal may be kept and used by any other officer of the corporation or by any Transfer Agent of its shares. Article III. SHARES SECTION 1. Certificates. Certificates evidencing the ownership of shares of the corporation shall be issued to those entitled to them by transfer or otherwise. Each certificate for shares shall bear a distinguishing number, the signature of the President or Vice-President, and of the Secretary or an Assistant Secretary, the seal of the corporation, and such recitals as may be required by law. The certificates for shares shall be of such tenor and design as the Board of Directors from time to time may adopt. SECTION 2. Transfers. (a) The shares may be transferred on the proper books of the corporation by the registered holders thereof, or by their attorneys legally constituted, or their legal representatives, by surrender of the certificate therefor for cancellation and a written assignment of the shares evidenced thereby. The Board of Directors may, from time to time, appoint such Transfer Agent or Registrars of shares as it may deem advisable, and may define their powers and duties. (b) All endorsements, assignments, transfers, share powers or other instruments of transfer of securities standing in the name of the corporation shall be executed for and in the name of the corporation by any two of the following officers, to-wit: the President or a Vice-President, and the Treasurer or Secretary or an Assistant Treasurer or an Assistant Secretary; or by any person or persons thereunto authorized by the Board of Directors. SECTION 3. Lost Certificates. The Board of Directors may order a new certificate or certificates of shares to be issued in place of any certificate or certificates alleged to have been lost or destroyed, but in every such case the owner of the lost certificates shall first cause to be given to the corporation a bond, with surety or sureties satisfactory to the corporation in such sum as said Board of Directors may in its discretion deem sufficient as indemnity against any loss or liability that the corporation may incur by reason of the issuance of such new certificates; but the Board of Directors may, in its discretion, refuse to issue such new certificate save upon the order of some court having jurisdiction in such matters pursuant to the statute made and provided. SECTION 4. Closing of Transfer Books. The share transfer books of the corporation may be closed by order of the Board of Directors for a period not exceeding ten (10) days prior to any meeting of the shareholders, and for a period not exceeding ten (10) days prior to the payment of any dividend. The times during which the books may be closed shall, from time to time, be fixed by the Board of Directors. Article IV. DIRECTORS The number of members of the Board of Directors shall be determined pursuant to law, by resolution of the shareholders entitled to vote, but shall not be less than three (3) members nor more than fifteen (15) members. The election of directors shall be held at the annual meeting of the shareholders, or at a special meeting called for that purpose. Directors shall hold office until the expiration of the term for which they were elected and shall continue in office until their respective successors shall have been duly elected and qualified. Article V. VACANCIES IN THE BOARD A resignation from the Board of Directors shall be deemed to take effect upon its receipt by the Secretary, unless some other time is specified therein. In case of any vacancy in the Board of Directors, through death, resignation, disqualification, or other cause deemed sufficient by the Board, the remaining directors, though less than a majority of the whole board, by affirmative vote of a majority of those present at any duly convened meeting may, except as hereinafter provided, elect a successor to hold office for the unexpired portion of the term of the director whose place shall be vacant, and until the election and qualification of a successor. Article VI. REGULAR MEETINGS Regular meetings of the Board of Directors shall be held annually or as the Board may designate. Article VII. SPECIAL MEETINGS Special meetings of the Board of Directors shall be called by the Secretary and held at the request of the President or any two of the directors. Article VIII. NOTICE OF MEETINGS The Secretary shall give notice of each meeting of the Board of Directors, whether regular or special, to each member of the Board. No advance notice need be given. Article IX. QUORUM A majority of the Directors in office at the time shall constitute a quorum at all meetings thereof, but no action of the Board shall be valid except by the affirmative vote of a majority of the entire Board. Article X. PLACE OF MEETINGS The Board of Directors may hold its meetings at such place or places within the State of Ohio as the Board may, from time to time, determine. Article XI. COMPENSATION Directors, as such, shall not receive any stated salary for their services, but, on resolution of the Board, a fixed sum for expenses of attendance, if any, may be allowed for attendance at each meeting, regular or special, provided that nothing herein contained shall be construed to preclude any Director from serving the corporation in any other capacity and receiving compensation thereof. Members of either executive or special committees may be allowed such compensation as the Board of Directors may determine for attending committee meetings. Article XII. ELECTION OF OFFICERS At the first meeting of the Board of Directors in each year (at which a quorum shall be present) held next after the annual meeting of the shareholders, and at any special meeting provided in Article VII, the Board of Directors shall elect officers of the corporation (including the President), and designate and appoint such subordinate officers and employes as it shall determine. They may also appoint an executive committee or committees from their number and define their powers and duties. Article XIII. OFFICERS The officers of this Company shall be a President, one or more Vice-Presidents, a Treasurer and a Secretary. The Board of Directors may also determine to elect a Chairman of the Board, and may appoint one or more Assistant Secretaries, one or more Assistant Treasurers and such other officers and agents of the Company as it may deem necessary or desirable. Any officer or employee elected or appointed by the Board of Directors, other than directors themselves, may be removed at any time upon the vote of a majority of the whole Board of Directors. The same person may hold more than one office, other than that of Chairman of the Board and President or Vice-President, President and Vice-President, Secretary and Assistant Secretary, or Treasurer and Assistant Treasurer. In case of the absence of any officer of the Company, or for any other reason which the Board of Directors may deem sufficient, the Board of Directors may delegate the powers or duties of such officer to any other officer or to any director, provided a majority of the whole Board of Directors concur therein. ARTICLE XIV. DUTIES OF OFFICERS (a) Chairman of the Board. The Chairman of the Board shall preside at all meetings of shareholders and directors. He shall also perform all duties incident to the office and such other duties as may be assigned to him from time to time by the Board of Directors. (b) President. The President, in the absence of the Chairman of the Board, shall preside at all meetings of shareholders and directors. He shall exercise, subject to the control of the Board of Directors and shareholders of the Company, a general supervision of the affairs of the Company, and shall perform generally all duties incident to the office and such other duties as may be assigned to him from time to time by the Board of Directors. (c) Vice-President. The Vice-President, in order of seniority, shall perform all duties of the President in his absence or during his disability to act, and shall have such other and further powers and shall perform such other and further duties as may be assigned to them by the Board of Directors. (d) Secretary. The Secretary shall keep the minutes of all proceedings of the Board of Directors and of the shareholders and make a proper record of the same, which shall be attested by him. He shall keep such books as may be required by the Board of Directors, and shall take charge of the seal of the corporation, and generally perform such duties as may be required by the Board of Directors. (e) Treasurer. The Treasurer shall have the custody of the funds and securities of the corporation which may come into his hands, and shall do with the same as may be ordered by the Board of Directors. When necessary or proper he may endorse on behalf of the corporation for collection, checks, notes and other obligations. He shall deposit the funds of the corporation to its credit in such banks and depositaries as the Board of Directors may, from time to time, designate. The fiscal year of the corporation shall be the same as that of Cincinnati Milacron Inc. He shall submit to the annual meeting of the shareholders a statement of the financial condition of the corporation, and whenever required by the Board of Directors, shall make and render a statement of his accounts, and such other statements as may be required. He shall keep in books of the corporation, full and accurate accounts of all moneys received and paid by him for account of his corporation. He shall perform such other duties as may, from time to time, be assigned to him by the Board of Directors. Article XV. ORDER OF BUSINESS 1. Call meeting to order. 2. Selection of chairman and secretary. 3. Proof of notice of meeting 4. Roll call, including filing of proxies with secretary. 5. Appointment of tellers. 6. Reading and disposal of previously unapproved minutes. 7. Reports of officers and committees. 8. If annual meeting, or meeting called for that purpose, election of directors. 9. Unfinished business. 10. New business. 11. Adjournment. This order may be changed by the affirmative vote of a majority in interest of the shareholders present. Article XVI. AMENDMENTS These regulations may be adopted, amended or repealed by the affirmative vote of a majority of the shares empowered to vote thereon at any meeting called and held for that purpose, notice of which meeting has been given pursuant to law, or without a meeting by the written assent of the owners of two-thirds of the shares of the corporation entitled to vote thereon. EX-3.7 5 y98028exv3w7.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.7 CERTIFICATE OF INCORPORATION OF CINCINNATI INTERNATIONAL FINANCE CORPORATION RECEIVED & FILED FEB 14 1966 10 A.M. /s/ [ILLEGIBLE] SECRETARY OF STATE CINCINNATI INTERNATIONAL FINANCE CORPORATION CERTIFICATE OF INCORPORATION Incorporated under the laws of the State of Delaware CERTIFICATE OF INCORPORATION OF CINCINNATI INTERNATIONAL FINANCE CORPORATION We, the undersigned, for the purpose or associating to establish a corporation for the transaction of the business and the promotion and conduct of the objects and purposes hereinafter stated, under the provisions, and subject to the requirements, of the laws of the State of Delaware (particularly Chapter 1 of Title 8 of the Delaware Code of 1953, known as the "General Corporation Law of the State of Delaware", and the acts amendatory thereof, supplemental thereto or substituted therefor), do make and file this Certificate of Incorporation in writing and do hereby certify as follows: FIRST: The name of the corporation (hereinafter called the Company) is CINCINNATI INTERNATIONAL FINANCE CORPORATION SECOND: The respective names of the County and of the City within the County in which the principal office of the Company is to be located in the State of Delaware are the County of New Castle and the City of Wilmington. The name of the resident agent of the Company is The Corporation Trust Company. The street and number of said 2 principal office and the address by street and number of said resident agent is No. 100 West Tenth Street, in the City of Wilmington, State of Delaware, 19899. THIRD: The name of the business of the Company, and the objects and purposes to be transacted, promoted or carried on by it, are as follows: (a) To acquire by purchase, subscription, exchange or otherwise and to receive, hold, own, sell, assign, transfer, exchange or otherwise dispose of, pledge or hypothecate, all kinds of stocks, bonds, mortgages, debentures, trust receipts, notes, and other securities, obligations, contracts, choses in action and evidences of indebtedness generally of any corporations, associations, firms, trusts, persons, governments, states, colonies, municipalities and other organizations; to receive, collect and dispose of interest, dividends and income upon, of and from any of the foregoing and any other property held or owned by it and to exercise any and all rights, powers and privileges of individual ownership or interest in respect of any and all such stocks or other securities or obligations, including the right to vote thereon or consent in respect thereof, for any and all purposes, and to do any and all acts and things for the preservation, protection, improvement and enhancement in value thereof and to guarantee the same or become surety in respect thereto, and to aid by loan, subsidy, guarantee or otherwise, those issuing, creating or responsible for the same, and to exercise any and all of said powers, either on its own account, or with or as agent for other persons, firms, corporations or other organizations; (b) To make, manufacture, develop, assemble, use, repair, buy, sell, lease and otherwise deal in and with machines, machinery, engines, motors, dynamos, apparatus, instruments, fixtures, appliances, devices and contrivances of any kind or nature whatsoever and any parts, accessories or improvements of any thereof, of any kind or nature whatsoever, and any and all other goods, articles, materials, wares and merchandise of any kind or nature whatsoever, and to do all things incident thereto, 3 and to hold all property and interests in property, real or personal, that may be necessary or convenient therefor; (c) To acquire by purchase or otherwise, erect, construct, improve, maintain and operate, or aid in or subscribe towards the erection, construction, improvement, maintenance and operation of, mills, factories, plants, laboratories, shops, storehouses, tanks, buildings, roads, watercourses, reservoirs, docks, piers, wharves, machinery, care and other rolling stock, steamers, steamboats, tugs, barges and vessels and works and structures of all kinds, in so far as the same may appertain to or be useful in the conduct of the business of the Company; (d) To adopt, apply for, obtain, register, purchase, lease or otherwise acquire, maintain, protect, hold, use, own, exercise, develop, operate, introduce, sell and grant licenses or other rights in respect of, and assign or otherwise dispose of or turn to account, any trademarks, trade names, patents, patent rights, concessions, copyrights and distinctive marks and rights analogous thereto, and inventions, improvements, processes, recipes, formulas and the like, including such thereof as may be covered by, used in connection with, or secured or received under, Letters Patent of the United States of America or of any other jurisdiction, which may be deemed capable of use in connection with any of the purposes of the Company herein stated; and to acquire, use, exercise or otherwise turn to account licenses in respect of any such trademarks, trade names, patents, patent rights, concessions, copyrights, distinctive marks and rights analogous thereto, inventions, improvements, processes, recipes, formulas and the like; (e) To acquire by purchase, exchange, lease or otherwise, and to own, hold, develop, operate, sell, assign, lease, transfer, convey, exchange, mortgage, pledge or otherwise dispose of or encumber property, real or personal, tangible or intangible, of any class or description, wheresoever situated, and rights and privileges therein; (f) To borrow or raise moneys for any of the purposes of the Company, without limit as to amount; from 4 time to time to issue and sell, pledge or otherwise dispose of bonds, debentures, notes or other evidences of indebtedness, secured or unsecured, of the Company, for moneys so borrowed or in payment for property acquired, or for any of the other objects or purposes of the Company or in connection with its business; to secure such bonds, debentures, notes and other evidences of indebtedness by mortgage or mortgages, or deed or deeds of trust, or pledge or other lien upon any or all of the property, rights, privileges or franchises of the Company, wheresoever situated, acquired or to be acquired; (g) To acquire by purchase, exchange, lease or otherwise all, or any part of, or any interest in, the properties, assets, business and good will of any one or more persons, firms, associations or corporations heretofore or hereafter engaged in any business in which the Company may lawfully engage; to pay for the same in cash, property or its own or other securities; to hold, operate, reorganize, liquidate, sell or in any manner dispose of the whole or any part thereof; and, in connection therewith, to assume or guarantee performance of any liabilities, obligations or contracts of such persons, firms, associations or corporation, and to conduct the whole or any part of any business thus acquired; (h) To purchase, hold, cancel, reissue, sell, exchange, transfer or otherwise deal in its own securities (including shares of its capital stock of any class), from time to time, to such an extent and in such manner and upon such terms as the Board of Directors may determine; provided that the Company shall not use its funds or property for the purchase of its own shares of capital stock when such use would cause any impairment of its capital, except as otherwise permitted by law; and provided further that shares of its own capital stock belonging to the Company shall not be voted upon directly or indirectly; (i) To aid by loan, guaranty, subsidy or in any other manner whatsoever, in so far as may be permitted by law, any person, firm, corporation, or association, domestic or foreign, any shares, or voting trust certificates for shares, or bonds, debentures, notes or other evidences of indebtedness of which shall be held by or for the Company or a subsidiary, or in which, or 5 in the welfare of which, the Company shall have any interest, and to do any acts or things designed to protect, preserve, improve or enhance the value of any such shares, voting trust certificates, bonds, debentures, notes or other evidences of indebtedness; and to guarantee, in so far as may be permitted by law, the payment of dividends upon any shares, or any sinking fund payments in respect of the shares, or the payment of the principal of, or interest on, or sinking fund payments in respect of, any bonds, debentures, notes or other evidences of indebtedness, or the performance of any contract, of any such person, firm, corporation or association; (j) To carry out all or any part of the foregoing purposes as principal, factor, agent, contractor or otherwise, either alone or in conjunction with any person, firm, association or other corporation and in any part of the world; and, in carrying on its business and for the purpose of furthering any of its purposes, to make and perform any and all such contracts of any kind and description with any person, firm, association, corporation, municipality, body politic, county, state or government, or colony or dependency thereof, and to do any and all such acts and things and to exercise any and all such powers, as a natural person could lawfully make, perform, do or exercise, provided that the same be not inconsistent with the laws of the State of Delaware; (k) To conduct its business in any and all of its branches in the State of Delaware, and in any and all other states, territories, possessions, colonies and dependencies of the United States of America, and in the District of Columbia, and in any and all foreign countries; to have one or more offices within and without the State of Delaware; and to carry on all and any of its operations and business without restriction or limit as to amount; and (l) To do any and all things necessary, suitable, convenient or proper for, or in connection with, or incidental to, the accomplishment of any of the purposes herein enumerated, or designed directly or indirectly to promote the interests of the Company, or to enhance the value of any of its properties or rights; and, in general, to do any and all things and exercise any and 6 All powers which it may now or hereafter be lawful for the Company to do or to exercise under the laws of the State of Delaware. It is the intention that the objects and purposes set forth in the foregoing clauses of this Article THIRD shall not, unless otherwise specified herein, be in any wise limited or restricted by reference to, or inference from, the terms of any other clause of this or any other article in this Certificate or Incorporation, but that the objects and purposes set forth in each of the clauses of this Article shall be regarded as independent objects and purposes. It is also the intention that said clauses shall be construed as powers, as well as objects and purposes, and that the foregoing enumeration of specific powers shall not be held to limit or restrict in any manner the general powers of the Company, and, generally, that the Company shall be authorized to do all things and exercise any and all powers, rights and privileges which a corporation may now or hereafter be organized to do or exercise under the General Corporation Law of the State of Delaware, or under any act amendatory thereof, supplemental thereto or substituted therefor; provided, however, that the Company shall not, in any state, district, territory, province, possesslon or country, carry on any business, or exercise any powers, except to the extent that a similar corporation organized under the laws of said state, 7 district, territory, province, possession or country could carry on such business or exercise such powers therein. Notwithstanding any other provision of this Certificate of Incorporation, the Company shall not have power or authority to issue bills, notes or other evidences of debt for circulation as money, or to carry on the business of receiving deposits of money, or the business of buying gold or silver bullion or foreign coins, or to engage in the business of banking or insurance, or to carry on the business of constructing, maintaining or operating public utilities in the State of Delaware. FOURTH: The total number of shares of stock which the Company shall have authority to issue is five thousand (5,000), and the par value of each of such shares shall be One hundred Dollars ($100). All such shares shall be of one class and shall be designated Common Stock. The minimum amount of capital with which the Company shall commence business is One thousand Dollars ($1,000). FIFTH: The names and places of residence of each of the incorporators are as follows:

8 SIXTH: The Company is to have perpetual existence. SEVENTH: The private property of the stockholders of the Company shall not be subject to the payment of corporate debts to any extent whatever. EIGHTH: For the management of the business and for the conduct of the affairs of the Company, and in further definition, limitation and regulation of the powers of the Company and of its directors and stockholders, it is further provided: 1. The number of directors of the Company shall be fixed by, or in the manner provided in, its By-laws, but in no case shall the number be less than three. A director need not be a stockholder. The election of directors of the Company need not be by ballot unless the By-laws so require. One-third of the directors (but not less than two) shall constitute a quorum for the transaction of business, unless the By-laws shall provide that a different number shall constitute a quorum, which in no case shall be less than one-third of the total number of directors nor less than two directors. 2. In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors is expressly authorized and 9 empowered: (a) To make, alter, amend and repeal the By-laws of the Company, in any manner not inconsistent with the laws of the State of Delaware or the Certificate of Incorporation of the Company, subject to the power of the stockholders of the Company having voting power to alter, amend or repeal the By-laws made by the Board of Directors; (b) Subject to the applicable provisions of the By-laws then in effect, to determine, from time to time, whether and to what extent and at what times and places and under what conditions and regulations the accounts and books and documents of the Company, or any of them, shall be open to the inspection of stockholders; and a stockholder shall not have any right to inspect any account or book or document of the Company, except as conferred by the laws of the State of Delaware, unless and until authorized so to do by resolution of the Board of Directors or of the stockholders of the Company; 10 (c) Without the assent or vote of the stockholders, to authorize and issue, from time to time, obligations of the Company, secured or unsecured, to include therein such provisions as to redeemability, convertibility into shares of stock of the Company or otherwise, and to authorize the mortgaging or pledging, as security therefor, of any property, real or personal, then owned or thereafter acquired by the Company, all as the Board of Directors, in its sole discretion, may determine; (d) To determine whether any, and, if any, what part, of the annual net profits of the Company or of its net assets in excess of its capital shall be declared in dividends and paid to the stockholders, and to direct and determine the use and disposition or any such annual net profits or net assets in excess of capital; (e) To fix from time to time the amount of the profits of the Company to be reserved as working capital or for any other lawful purpose; (f) To establish bonus, profit-sharing, retirement or other types of incentive or compensation 11 plans for the officers and employees (including officers and employees who are also directors) of the Company and to determine the persons to participate in any such plans and the amount of their respective participations; and in connection with the acquisition of all or any part of the property, assets, business and good will of any persons, firms, associations or corporations, to assume, adopt or enter into any such plans previously established by such persons, firms, associations or corporations; (g) By resolution passed by a majority of the whole Board, to designate one or more committees, each committee to consist of two (2) or more of the directors of the Company, which to the extent provided in said resolution or in the By-laws, shall have and may exercise the powers of the Board of Directors in the management of the business and affairs of the Company and may have power to authorize the seal of the Company to be affixed to all papers which may require it, such committee or committees to have such name or names as may be stated in the By-laws or as may be determined from time to time by resolution adopted by the Board of Directors; 12 (h) To cause the Company to enter into an agreement or agreements with one or more stockholders restricting or affecting the transferability of any shares of stock represented by certificates held by such stockholders and, provided the restriction is stated upon the certificate or certificates representing such shares, to restrict the transferability of any shares of stock so represented in accordance with such agreement or agreements; and (i) In addition to the powers and authorities hereinbefore and by the laws of the State of Delaware expressly conferred upon the Board or Directors, to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the laws of the state of Delaware, of this Certificate of Incorporation and of the By-laws of the Company. 3. Any director elected by the stockholders of the Company and any director or officer elected or appointed by its Board of Directors may be removed at any time in such manner as shall be provided in the By-laws of the Company. 13 4. In the absence of fraud, no contract or other transaction between the Company and any other corporation, and no act of the Company, shall in any way be invalidated or otherwise affected by the fact that any one or more of the directors of the Company are pecuniarily or otherwise interested in, or are directors or officers of, such other corporation or have a pecuniary or other interest in such act. Any director of the Company individually, or any firm or association of which any director may be a member, may be a party to, or may be pecuniarily or otherwise interested in, any contract or transaction of the Company, provided that the fact that he individually or such firm or association is such a party or so interested shall be disclosed or shall have been known to the Board of Directors of the Company or a majority or the members thereof who shall be present at any meeting of the Board of Directors at which action upon any such contract or transaction shall be taken: and any director of the Company who is also a director or officer of such other corporation or who is so interested, may be counted in determining the existence of a quorum at any meeting of the Board of Directors or of any committee thereof which shall authorize any such contract or transaction, and may 14 vote thereat to authorize any such contract or transaction, with like force and effect as if he were not such director or officer of such other corporation or not so interested. Any director of the Company may vote upon any contract or other transaction between the Company and any subsidiary or affiliated corporation without regard to the fact that he is also a director of such subsidiary or affiliated corporation. Any contract, transaction or act of the Company, of the Board of Directors, of any committee of the Board of Directors, which shall be ratified by a majority of a quorum of the stockholders of the Company entitled to vote at any annual meeting, or at any special meeting called for such purpose, shall, in so far as permitted by law or by this Certificate of Incorporation, be as valid and as binding as though ratified by every such stockholder; provided, however, that any failure of the stockholders to approve or ratify any such contract, transaction or act, when and if submitted, shall not be deemed in any way to invalidate the same or deprive the Company, its directors, officers or employees, of its or their right to proceed with such contract, transaction or act. 15 5. Subject to any limitation in the By-laws then in effect, the members or the Board of Directors shall be entitled to reasonable fees, salaries, or other compensation for their services and to reimbursement for their expenses as such members. Nothing contained herein shall preclude any director from serving the Company, or any subsidiary or affiliated corporation, in any other capacity and receiving proper compensation therefor. NINTH: The stockholders and the Board of Directors shall have the power, if the By-Laws so provide, to hold their respective meetings outside of the State of Delaware, and, except as otherwise required by law, the corporate records, books, documents and papers of the Company may be kept outside of the State of Delaware. TENTH: The Company reserves the right from time to time to amend, alter, change, add or to repeal any provisions contained in this Certificate of Incorporation in any manner now or hereafter prescribed by law, and all rights and powers at any time conferred upon stockholders, directors and officers of the Company by this Certificate of Incorporation or any amendment thereof are subject to the 16 provisions of this Article TENTH. IN WITNESS WHEREOF, we, the undersigned, being all of the incorporators hereinabove named, do hereby further certify that the facts hereinabove stated are truly set forth, and accordingly have hereunto set our respective hands and seals this 14th day of February 1966. /s/ [ILLEGIBLE] [L.S.] ----------------------- /s/ [ILLEGIBLE] [L.S.] ---------------------- /s/ [ILLEGIBLE] [L.S.] ---------------------- STATE OF DELAWARE, ) ) ss.: COUNTY OF NEW CASTLE, ) BE IT REMEMBERED that on the 14th day of February 1966, personally appeared before me, A. Dana Atwell , a Notary Public in and for the County and State aforesaid,' S. H. Livesay , P. J. Obara, Jr. , and A. D. Orier , all the incorporators who signed the foregoing Certificate of Incorporation, known to me personally to be such, and I having made known to them and to each of them the contents of said Certificate of Incorporation, they did severally acknowledge the same to be the act and deed of the signers, respectively and that the facts therein stated are truly set forth. GIVEN under my hand and seal of office the day and year aforesaid. /s/ [ILLEGIBLE] --------------------------- Notary Public CERTIFICATE OF AMENDMENT OF CINCINNATI INTERNATIONAL FINANCE CORPORATION FILED MAY 1 1970 10 A.M. /s/ [ILLEGIBLE] --------------- SECRETARY OF STATE CERTIFICATE OF AMENDMENT OF CERTIFICATE OF INCORPORATION OF CINCINNATI INTERNATIONAL FINANCE CORPORATION * * * * Cincinnati International Finance Corporation, a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: FIRST: That the Board of Directors of Cincinnati International Finance Corporation by the unanimous written consent of its members, filed with the minutes of the Board, duly adopted resolutions setting forth a proposed amendment to the Certificate of Incorporation of said corporation, declaring said amendment to be advisable and calling a meeting of the stockholders of said corporation for consideration thereof. The resolution setting forth the proposed amendment is as follows: RESOLVED that the Certificate of Incorporation of this corporation be amended by changing the Article thereof numbered "FIRST" so that, as amended, said Article shall be and reas as follows: "FIRST: The name of the corporation (hereinafter called the Company) is Cincinnati Milacron International Finance Corp." - 2 - SECOND: That thereafter, pursuant to resolution of its Board of Directors, an annual meeting of the stockholders of said corporation was duly called and held, upon notice in accordance with section 222 of the General Corporation Law of the State of Delaware, at which meeting the necessary number of shares as required by statue were voted in favor of the amendment. THIRD: That said amendment was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware. FOURTH: That the capital of said corporation will not be reduced under or by reason of said amendment. IN WITNESS WHEREOF, said Cincinnati International Finance Corporation has caused its corporate seal to be hereunto affixed and this certificate to be signed by Philip O. Geier, Jr. its President, and attested by N. Jouett Elmore, its Secretary, this 22nd day of April, 1970. Cincinnati International Finance Corporation (CORPORATE SEAL) By /s/ Philip O. Geier ------------------------------ President ATTEST: By /s/ N. Jouett Elmore ------------------------- Secretary - 3 - STATE OF OHIO ) ) ss: COUNTY OF HAMILTON ) BE IT REMEMBERED that on this 22nd day of April, 1970, personally came before me, a Notary Public in and for the County and State aforesaid, Philip O. Geier, Jr, President of Cincinnati International Finance Corporation, a corporation of the State of Delaware, and he duly executed said certificate before me and acknowledged the said certificate to be his act and deed and the act and deed of said corporation and the facts stated therein are true; and that the seal affixed to said certificate and attested by the Secretary of said corporation is the common or corporate seal of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and seal of office the day and year aforesaid. (SEAL) /s/ Sam Redrow, Jr. -------------------------------- Notary Public SAM REDROW, JR., Notary Public My Commission expires Aug. 24, 1972 CERTIFICATE OF AMENDMENT OF CERTIFICATE OF INCORPORATION * * * * * Cincinnati Milacron International Finance Corp., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: FIRST: That the Board of Directors of said corporation, by unanimous written consent of its members, filed with the minutes of the Board, adopted a resolution proposing and declaring advisable the following amendment to the Certificate of Incorporation of said corporation: RESOLVED, that in the judgment of the Board of Directors, it is deemed advisable to amend the Certificate of Incorporation so as to change the name of this Corporation from Cincinnati Milacron International Finance Corp. to Cincinnati Milacron International Marketing Company; RESOLVED, that the Certificate of Incorporation of this Corporation be amended by changing the Article thereof numbered "FIRST" so that, as amended, said Article shall be and read as follows: "FIRST: the name of the Corporation (hereinafter called the Company) is Cincinnati Milacron International Marketing Company."; RESOLVED, that the aforesaid Resolution be submitted to the Stockholders of this Corporation for approval. SECOND: That in lieu of a meeting and vote of Stockholders, the Stockholders have given unanimous written consent to said amendment in accordance with the provisions of Section 228 of the General Corporation Law of the State of Delaware. THIRD: That the aforesaid amendment was duly adopted in accordance with the applicable provisions of Sections 242 and 228 of the General Corporation Law of the State of Delaware. IS WITNESS WHEREOF, said Cincinnati Milacron International Finance Corp. has caused this certificate to be signed by J. A. D. Geier, its President, and attested by R. G. Wilson, its Secretary, this 1st day of December, 1980. CINCINNATI MILACRON INTERNATIONAL FINANCE CORP. BY: /s/ J. A. D. Geier -------------------------------------------- J. A. D. Geier - President ATTESTS By: /S/ R. G. Wilson ---------------------- SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 10:00 AM 09/24/1998 981370955 - 0637104 CERTIFICATE OF AMENDMENT OF CERTIFICATE OF INCORPORATION CINCINNATI MILACRON INTERNATIONAL MARKETING COMPANY, a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: FIRST: That the Board of Directors of said corporation, at a meeting duly held, adopted a resolution proposing and declaring advisable the following amendment to the Certificate of Incorporation of said corporation: RESOLVED, that the Certificate of Incorporation of CINCINNATI MILACRON INTERNATIONAL MARKETING COMPANY be amended by changing the First Article and Heading thereof so that, as amended, said Article and Heading shall be and read as follows: The name of the company is Milacron International Marketing Company. SECOND: That in lieu of a meeting and vote of shareholders, the stockholders have given written consent to said amendment in accordance with the provisions of Section 228 of the General Corporation Law of the State of Delaware. THIRD: That the aforesaid amendment was duly adopted in accordance with the applicable provisions of Sections 242 and 228 of the General Corporation Law of the State of Delaware. FOURTH: This Certificate of Amendment shall be effective on October 10, 1998. IN WITNESS WHEREOF, said CINCINNATI MILACRON INTERNATIONAL MARKETING COMPANY has caused this certificate to be signed by Wayne F. Taylor, its Secretary and Assistant Treasurer, this 24 day of September, 1998. CINCINNATI MILACRON INTERNATIONAL MARKETING COMPANY By: /s/ Wayne F. Taylor -------------------------------------------------- Wayne F. Taylor, Secretary and Assistant Treasurer EX-3.8 6 y98028exv3w8.txt BYLAWS EXHIBIT 3.8 CINCINNATI MILACRON INTERNATIONAL FINANCE CORP. BY-LAWS Incorporated under the laws of the State of Delaware This is the document marked "A" referred to in the Affidavit of Wayne F. Taylor made this 28 day of October, 1991. Before me, /s/ Gloria E. Lucas ------------------- Notary Public BY-LAWS of CINCINNATI MILACRON INTERNATIONAL FINANCE CORP. ARTICLE I Offices Section 1. Principal Office. The principal office of Cincinnati Milacron International Finance Corp. (hereinafter called the Company) in the State of Delaware shall be in the City of Wilmington, County of New Castle, and the resident agent in charge thereof shall be The Corporation Trust Company. Section 2. Other Offices. The Company may also have an office or offices, and keep the books and records of the Company, except as may otherwise be required by the laws of the State of Delaware, at such other place or places, either within or without the State of Delaware, as the Board of Directors may from time to time determine or the business of the Company require. ARTICLE II Meetings of Shareholders Section 1. Place of Meeting. Each meeting of the shareholders of the Company shall be held at the principal 2 office of Cincinnati Milacron Inc., 4701 Marburg Avenue, Cincinnati, Ohio 45209, U.S.A., or at such other place within said city as may be fixed by the Board of Directors and specified in the notice or waiver of notice thereof. Section 2. Annual Meetings. The annual meeting of shareholders of the Company for the election of directors and for the transaction of such other business as may come before the meeting shall be held at 10 o'clock in the forenoon on the third Tuesday in April, if not a legal holiday under the laws of the State in which the meeting shall be held, and, if a legal holiday, then on the next succeeding business day not a legal holiday under the laws of said State. Section 3. Special Meetings. A special meeting of the shareholders for any purpose or purposes, unless otherwise prescribed by law, may be called at any time by the President or by order of the Board of Directors or by a shareholder or shareholders holding of record at least twenty-five per cent (25%) of all the shares of the Company then outstanding and entitled to vote thereat. Section 4. Notice of Meetings. Except as otherwise provided by law, notice of each meeting of the shareholders, whether annual or special, shall be given, not 3 less than ten days before the day on which the meeting is to be held, to each shareholder of record entitled to vote at such meeting by delivering a written or printed notice thereof to him personally, or by mailing such notice in a postage prepaid envelope addressed to him at his post-office address furnished by him to the Secretary of the Company for such purpose, or, if he shall not have furnished his address to the Secretary of the Company for such purpose, then at his post-office address as it appears on the records of the Company, or by transmitting a notice thereof to him at such address by telegraph, cable, radio or wireless. Except where expressly required by law, no publication of any notice of a meeting of shareholders shall be required. Every such notice shall state the time and place of the meeting but need not state the purposes thereof except as otherwise by law or by the Certificate of Incorporation of the Company or by these By-laws expressly provided. Notice of any meeting of shareholders shall not be required to be given to any shareholder who shall attend such meeting in person or by proxy, or who shall have waived notice thereof as provided in Article X of these By-laws. Notice of any adjourned meeting of the shareholders shall not be required to be given, except when expressly required by law. 4 Section 5. Quorum. The holders of shares entitling them to exercise a majority of the voting power, present in person or by proxy at any meeting of the shareholders, shall constitute a quorum, unless by law or by the provisions of the Certificate of Incorporation of the Company the affirmative vote of a greater percentage of the voting power is required for the approval of any specified matter, in which case, as to such matter, the holders of shares entitling them to exercise such percentage of the voting power shall constitute a quorum with respect to such matter. Section 6. Adjournments. If at any annual or special meeting a quorum shall fail to attend in person or by proxy, a majority in interest of the shareholders attending in person or by proxy at the time and place of such meeting may adjourn the meeting from time to time without further notice, other than by announcement at the meeting at which such adjournment is taken, until a quorum shall be present. At any such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally called. The absence from any meeting of shareholders holding such number of shares as is required by law or by the Certificate of Incorporation of the Company or by these 5 By-laws for action upon any given matter shall not prevent action at such meeting upon any other matter or matters which may properly come before the meeting, if shareholders holding such number of shares as is required in respect of such other matter or matters shall be present in person or by proxy. Section 7. Organization. At every meeting of the shareholders, the Chairman of the Board, or, in his absence, the President, or, in the absence of both the Chairman of the Board and the President, any Vice-President, or, in the absence of all such officers, a chairman chosen by a majority vote of the shareholders present in person or by proxy and entitled to vote thereat, shall act as chairman. The Secretary, or, in his absence, an Assistant Secretary, shall act as secretary at all meetings of the shareholders. In the absence of the Secretary and the Assistant Secretaries, the chairman may appoint any person present to act as secretary of the meeting. Section 8. List of Shareholders. It shall be the duty of the Secretary or other officer of the Company who shall have charge of its stock ledger, either directly or through another officer of the Company designated by him or through a transfer agent or transfer clerk appointed by the Board of Directors, to prepare and make, at least ten (10) days before every meeting of the shareholders for the 6 election of directors of the Company, a complete list of the shareholders entitled to vote thereat, arranged in alphabetical order. Such list shall be open, at the place where said meeting is to be held, for said ten (10) days, to the examination of any shareholder, and shall be produced and kept at the time and place of said meeting during the whole time thereof and subject to the inspection of any shareholder who shall be present thereat. Upon the wilful neglect or refusal of the directors to produce such list at any election, they shall be ineligible to any office at such election. The original or duplicate stock ledger shall be the only evidence as to who are the shareholders entitled to examine such list or the books of the Company, or to vote in person or by proxy at such election. Section 9. Business and Order of Business. At each meeting of the shareholders such business may be transacted as may properly be brought before such meeting, whether or not such business is stated in the notice of such meeting or in a waiver of notice thereof, except as otherwise by law or by the Certificate of Incorporation of the Company or by these By-laws expressly provided. The order of business at all meetings of the shareholders shall be as determined by the chairman, unless a majority in interest of the shareholders present in person or by proxy at such meeting and entitled to vote thereat shall otherwise determine. 7 Section 10. Voting. Except as otherwise provided by law or by the Certificate of Incorporation of the Company, each shareholder of record shall be entitled at each meeting of shareholders to one vote for each share of the Company registered in his name on the books of the Company (1) on the date fixed pursuant to Section 5 of Article VII of these By-laws as the record date for the determination of shareholders entitled to notice of and to vote at such meeting; or (2) if no such record date shall have been fixed, then at the time of such meeting. Shares of the Company belonging to the Company shall not be voted upon directly or indirectly. At all meetings of the shareholders, all matters (except in special cases where other provision is made by law and except as otherwise provided in the Certificate of Incorporation of the Company) shall be decided by a majority of the votes cast by the shareholders present in person or by proxy and entitled to vote thereat, a quorum being present. Unless required by law, or demanded by a shareholder present in person or by proxy at such meeting and entitled to vote thereat, or determined by the chairman of the meeting to be advisable, the vote on any question need not be by ballot. Upon a demand by any such shareholder for a vote by 8 ballot upon any question or election, such vote shall be taken by ballot. On a vote by ballot, each ballot shall be signed by the shareholder voting, or by his proxy as such if there be such proxy, and shall state the number of shares voted by such shareholder or proxy. Section 11. Inspectors. Inspectors of election for each meeting of shareholders may be appointed in the manner provided by law, and shall have the duties and authority and shall make the determinations provided by law. Inspectors need not be stockholders. Section 12. Action by Consent. Any action required or permitted to be taken at any meeting of the stockholders may be taken without a meeting if all the stockholders who would have been entitled to vote upon the action if such meeting were held shall consent in writing to the action being taken. ARTICLE III Board of Directors Section 1. General Powers. The Board of Directors shall manage and conduct the property, affairs and business of the Company and may exercise all such authority and powers of the Company and do all such lawful acts and things as are not by law, the Certificate of Incorporation 9 of the Company or these By-laws directed or required to be exercised or done by the shareholders. Section 2. Number and Term of Office. The number of directors shall be such number, not less than three nor more than twelve, as shall from time to time be determined by the Board of Directors; and, unless otherwise determined by the Board, shall be four. Directors need not be stockholders. Each director shall hold office until the annual meeting of the shareholders next following his election and until his successor shall have been elected and shall qualify, or until his death, or until he shall resign, or until he shall have been removed in the manner hereinafter provided. Section 3. Election of Directors. At each meeting of the shareholders for the election of directors at which a quorum is present, the persons receiving the greatest number of votes shall be deemed elected. Section 4. Quorum and Manner of Acting. Except as otherwise provided by law or by these By-laws, one-third of the directors (but not less than two) shall constitute a quorum for the transaction of business at any meeting, and the act of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board of Directors. In the absence of a quorum, a majority 10 of the directors present may adjourn any meeting from time to time until a quorum be had. Notice of any adjourned meeting need not be given. Section 5. Place of Meeting. The Board of Directors may hold its meetings at such place or places within or without the State of Delaware as the Board may from time to time determine or as shall be specified or fixed in the respective notices or waivers of notice thereof. Section 6. First Meeting. The Board of Directors shall meet for the purpose of organization, the election of officers and the transaction of other business, as soon as practicable after each election of directors and on the same day, and at the same place at which regular meetings of the Board are held, or as may be otherwise provided by resolution of the Board. Notice of such meeting need not be given. Such meeting may be held at any other time or place which shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors or in a consent and waiver of notice thereof signed by all directors. Section 7. Regular Meetings. Regular meetings of the Board of Directors shall be held at such places and at such times as the Board shall from time to time by resolution determine. If any day fixed for a regular meeting shall be a legal holiday at the place where the meeting is 11 to be held, then the meeting which would otherwise be held on that day shall be held at the same hour on the next succeeding business day not a legal holiday. Section 8. Special Meetings. Special meetings of the Board of Directors shall be held whenever called by the Chairman of the Board or the President or by any two (2) of the directors. Section 9. Notice of Meetings. Notice of each regular and special meeting of the Board of Directors shall be mailed to each director, addressed to him at his residence or usual place of business, or shall be sent to him at such place by telegraph, cable, radio or wireless, or be given personally or by telephone, at least two (2) days before the day on which the meeting is to be held. Every such notice shall state the time and place of the meeting but need not state the purposes thereof except as otherwise in these By-laws expressly provided. Notice of any meeting of the Board need not be given to any director who shall have waived notice thereof as provided in Article X of these By-laws; and any meeting of the Board shall be a legal meeting without any notice thereof having been given, if all of the directors shall be present thereat. Section 10. Organization. At each meeting of the Board of Directors the Chairman of the Board, or in his absence the President, or in his absence a director chosen 12 by a majority of the directors present, shall act as chairman. The Secretary, or in his absence an Assistant Secretary, or in the absence of the Secretary and Assistant Secretaries, any person appointed by the chairman, shall act as secretary of the meeting. Section 11. Order of Business. At all meetings of the Board of Directors business shall be transacted in the order determined by the chairman of the meeting, subject to the approval of the Board. Section 12. Action by Consent. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if prior to such action a written consent thereto is signed by all members of the Board or of such committee, as the case may be, and such written consent is filed with the minutes of the proceedings of the Board or such committee. Section 13. Resignations. Any director of the Company may resign at any time by giving written notice to the President or to the Secretary of the Company. The resignation of any director shall take effect at the date of receipt of such notice or at any later date specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 14. Removal of Directors. Any director may be removed, either with or without cause, at any time, by the vote of the holders of record of a majority of the 13 outstanding shares having voting power at a special meeting of the shareholders called for the purpose. Section 15. Vacancies. Any vacancy in the Board of Directors caused by death, resignation, disqualification, removal, an increase in the number of directors, or any other cause, may be filled by a majority of the remaining directors (though less than a quorum), and each director so chosen shall hold office until the next annual election and until his successor shall be duly elected and qualified, unless sooner displaced. Section 16. Compensation. Directors, as such, shall not receive any stated salary for their services, but by resolution of the Board of Directors a fixed sum and expenses of attendance, if any, may be allowed for attendance at each regular and special meeting of the Board. Nothing herein contained shall be construed so as to preclude any director from serving the Company in any other capacity and receiving compensation therefor. Section 17. Indemnification of Employees, Officers and Directors. (a) Any person who is or was an employee, officer or director of the Company, or of any other corporation which he served as such at the request of the Company, shall, unless prohibited by law, be indemnified by the Company in accordance 14 with paragraph (b) below against reasonable expense and any liability, paid or incurred by him in connection with or resulting from any claim, action, suit or proceeding (whether brought by or in the right of the Company or such other corporation or otherwise), civil or criminal, including any appeal therein, in which he may be involved, or threatened to be involved, as a party or otherwise, by reason of his being or having been an employee, officer or director of the Company or such other corporation, or by reason of any action taken or not taken in his capacity as such employee, officer or director, provided such person acted, in good faith, in what he reasonably believed to be in the best interest of the Company or such other corporation, as the case may be, and, in addition, with respect to any criminal actions or proceedings, reasonably believed that his conduct was lawful, and provided further that, in the case of a claim, action, suit or proceeding brought by or in the right of the Company to procure a judgment in its favor, such person has not been adjudged to have been derelict in the performance of his duty to the Company. The termination of any claim, action, suit or proceeding, civil or criminal, by judgment, settlement (whether with or without court approval), adverse decision or conviction after trial or upon a plea of 15 guilty or of nolo contendere, or its equivalent, shall not create a presumption that an employee, officer or director did not meet the standards of conduct set forth in this paragraph (a). As used in this Section 17 the term "expense" shall mean counsel fees and disbursements and all other expenses (except any liability) relating to any such claim, action, suit or proceeding, and the term "liability" shall mean amounts of judgments, fines or penalties against, and amounts paid in settlement by, an employee, officer or director other than any amount payable to the Company in satisfaction of any judgment or settlement. (b) Any person referred to in paragraph (a) of this Section 17 who has been wholly successful, on the merits or otherwise, with respect to any claim, action, suit or proceeding of the character described in paragraph (a) shall be reimbursed by the Company for his reasonable expense. Any other person claiming indemnification under said paragraph (a) shall be reimbursed by the Company for his reasonable expense and any liability if (i) a majority of those directors of the Company who are not parties to such claim, action, suit or proceeding, acting upon the advice of independent legal counsel (who may be regular counsel for 16 the Company and who shall have generally recognized competence to advise upon the matter) selected by such directors, shall deliver to the Company their written findings that such person is entitled to such reimbursement under the provisions of said paragraph or (ii) if there be no such directors, such independent legal counsel selected by the Board of Directors, whether or not a disinterested quorum exists, shall deliver to the Company their written advise that, in their judgment, such person is so entitled. (c) Any expense incurred with respect to any claim, action, suit or proceeding of the character described in paragraph (a) of this Section 17 may be advanced by the Company prior to the final disposition thereof upon receipt of any undertaking by or on behalf of the employee, officer or director to repay such amount if it is ultimately determined that he is not to be indemnified under this Section 17. (d) The rights of indemnification provided in this Section 17 shall be in addition to any other rights to which any such employee, officer or director may otherwise be entitled under the articles, the regulations, any agreement, vote of shareholders or otherwise; and in the event of such person's death, such rights shall extend to his heirs 17 and legal representatives. The foregoing rights shall be available whether or not such person continues to be an employee, officer or director at the time of incurring or becoming subject to such loss, expenses, costs and counsel fees and whether or not the claim asserted against him is based on matters which antedate the adoption of these paragraphs (a) to (d), inclusive, of this Section. ARTICLE IV Executive and Other Committees Section 1. Appointment and Powers. The Board of Directors may, by resolution adopted by a majority of the whole Board, designate annually three or more of their number one of whom shall be the President of the Company, to constitute an Executive Committee, and may delegate to such committee power to exercise in the intervals between the meetings of the Board of Directors any of the powers of the Board in the management of the business and affairs of the Company to the extent provided in said resolution and such powers may be general or confined to specific instances. Any member of the Executive Committee may be removed at any time by the vote of a majority of the whole Board. 18 Section 2. Procedure; Meetings; Quorum. The Executive Committee shall fix its own rules of procedure, and shall meet at such times and at such place or places as may be provided by such rules, or by resolution of the Executive Committee or of the Board of Directors. At every meeting of the Executive Committee the presence of a majority of all the members shall be necessary to constitute a quorum and the affirmative vote of a majority of the members present shall be necessary for the adoption by it of any resolution. Section 3. Resignations. Any member of the Executive Committee may at any time resign by giving written notice to the President or to the Secretary of the Company. Such resignation shall take effect at the date of receipt of such notice or at any later date specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 4. Other Committees. The Board of Directors may from time to time by resolution create such other committee or committees of directors, officers, employees or other persons designated by it for the purpose, to advise with the Board, the Executive Committee and the officers and employees of the Company in all such matters as the Board shall deem advisable and with such functions and duties as the Board shall by resolution prescribe; provided, however, 19 that no such committee shall exercise the powers of the Board of Directors in the management of the business and affairs of the Company or have power to authorize the seal of the Company to be affixed to papers which may require it unless such committee shall consist entirely of three or more directors of the Company, shall be created by resolution passed by a majority of the whole Board and shall be so authorized by such resolution. A majority of all the members of any such committee may determine its action and fix the time and place of its meetings, unless the Board of Directors shall otherwise provide. The Board of Directors shall have power to change the number of members or the personnel of any such committee at any time, to fill vacancies, and to discharge any such committee, either with or without cause at any time. Section 5. Compensation. No member of any committee contemplated by these By-laws shall, as such, receive any stated salary for his services, but, by resolution of the Board of Directors, a fixed sum, not exceeding $100, may be allowed to members of such committees, other than to salaried officers or employees, for attendance at each meeting of any such committee. All members of such committees shall receive their expenses, if any, of attendance at meetings of such committees. 20 Nothing herein shall be construed to preclude any member of any such committee from serving the Company in any other capacity and receiving proper compensation therefor. ARTICLE V Officers Section 1. Number. The officers of the Company shall be a Chairman of the Board, a President, one or more Vice-Presidents, a Treasurer and a Secretary. Other officers may be appointed in accordance with the provisions of Section 3 of this Article V. One person may hold the offices and perform the duties of any two or more of said officers, except those of President and Secretary. Section 2. Election. Term of Office and Qualifications. The officers shall be chosen by the Board of Directors. Each officer, except such officers as may be appointed in accordance with the provisions of Section 3 of this Article V, shall hold office until his successor is chosen and shall have qualified or until his death or until he shall have resigned or shall have been removed in the manner hereinafter provided. The Chairman of the Board and the President shall be chosen from among the directors. Section 3. Appointive Officers, etc. The Board of Directors may from time to time appoint such other officers as 21 it may deem necessary, including one or more additional Vice-Presidents, one or more Assistant Treasurers and one or more Assistant Secretaries, and the Board of Directors or the President may from time to time appoint such agents and employees of the Company as may be deemed proper. Such officers, agents and employees shall hold office for such period, have such authority, and perform such duties as in these By-laws provided or as the Board of Directors or the President may from time to time prescribe. The Board of Directors may from time to time authorize any officer to appoint and remove agents and employees and to prescribe their powers and duties. Section 4. Removal. Any officer may be removed, either with or without cause, at any time, by the vote of a majority of the whole Board of Directors at any regular meeting, or at any special meeting called for the purpose. Section 5. Resignations. Any officer may resign at any time by giving notice to the Board of Directors or to the President or to the Secretary. Any such resignation shall take effect at the date of receipt of such notice or at any later date specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 6. Vacancies. A vacancy in any office because of death, resignation, removal or any other cause shall 22 be filled for the unexpired portion of the term in the manner prescribed in these By-laws for election or appointment to such office. Section 7. Chairman of the Board. The Chairman of the Board shall, if present, preside at all meetings of the shareholders and of the Board of Directors and shall perform such other duties relating to the business and operations of the Company as may from time to time be assigned to him by the Board of Directors. Section 8. The President. The President shall be the Chief Executive Officer of the Company. The President shall have general supervision of the business, affairs and property of the Company and over its several officers, subject, however, to the authority of the Board of Directors. He shall be ex officio a member of all standing committees. He may sign and execute in the name of the Company all deeds, mortgages, bonds, contracts or other instruments authorized by the shareholders or the Board of Directors in accordance with law and these By-laws, except in cases where the signing and execution thereof shall be expressly delegated by the shareholders or the Board or by any committee designated thereby with power so to act or by these By-laws to some other officer or agent of the Company and except any instruments required by law or otherwise to be signed or executed, and may affix 23 the seal of the Company to any instrument requiring the same. He may sign, with the Secretary or an Assistant Secretary, or the Treasurer or an Assistant Treasurer, any or all certificates for shares of the Company; and, in general, shall, except as otherwise provided in these By-laws, perform all duties incident to the office or President and such other duties as from time to time may be assigned to him by the Board of Directors and shall perform such other duties as are prescribed by these By-laws. Section 9. The Vice-Presidents. Each Vice-President shall, except as otherwise provided in these By-laws, have such powers and perform such duties as the Board of Directors or any committee designated thereby with power so to act may from time to time prescribe and shall perform such other duties as may be prescribed by these By-laws. Any Vice-President may also sign, with the Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer, any or all certificates for shares of the Company. At the request of the President or in case of his absence or inability to act any Vice-President may act in his place. Section 10. The Secretary. The Secretary shall keep or cause to be kept in books provided for the purpose the minutes of the meetings of the shareholders, of the Board of Directors and of all committees designated thereby; shall 24 see that all notices are duly given in accordance with the provisions of these By-laws and as required by law; shall be custodian of the records and of the seal of the Company and see that the seal is affixed to all documents the execution of which on behalf of the Company under its seal is duly authorized in accordance with the provisions of these By-laws; shall keep or cause to be kept a register of the post-office address of each shareholder, and make or cause to be made all proper changes in such register, retaining and filing his authority for all such entries; shall see that the books, reports, statements, certificates and all other documents and records required by law are properly kept and filed; may sign, with the President or any Vice-President, any or all certificates for shares of the Company; and, in general, shall, except as otherwise provided in these By-laws, perform all duties incident to the office of Secretary and such other duties as may, from time to time, be assigned to him by the Board of Directors, or any committee designated thereby with authority so to act, or the President. Section 11. Assistant Secretaries. The Assistant Secretaries shall, except as otherwise provided in these By-laws, perform such duties as from time to time may be assigned to them by the President, the Secretary, the Board of Directors, or any committee designated thereby with power so to act. At 25 the request of the Secretary or in case of his absence or inability to act any Assistant Secretary may act in his place. Section 12. The Treasurer. The Treasurer shall give such bond, if any, for the faithful performance of his duties as the Board of Directors shall require. He shall have charge and custody of, and be responsible for, all funds and securities of the Company, and shall deposit all such funds in the name of the Company in such banks, trust companies or other depositaries as shall be selected in accordance with the provisions of these By-laws; shall render a statement of the condition of the finances of the Company at all regular meetings of the Board of Directors, and a full financial report at the annual meeting of the shareholders, if called upon to do so; shall receive, and give receipts for, moneys due and payable to the Company from any source whatsoever; may sign, with the President or any Vice-President, any or all certificates for shares of the Company; and, in general, shall, except as otherwise provided in these By-laws, perform all the duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him by the Board of Directors, or any committee designated thereby with power so to act, or the President. Section 13. Assistant Treasurers. Each of the Assistant Treasurers shall give such bond, if any, for the 26 faithful performance of his duties as the Board of Directors shall require. The Assistant Treasurers shall, except as otherwise provided in these By-laws, perform such duties as from time to time may be assigned to them by the President, the Treasurer, the Board of Directors, or any committee designated thereby with power so to act. At the request of the Treasurer or in case of his absence or inability to act any Assistant Treasurer may act in his place. Section 14. Salaries. The salaries of the Chairman of the Board and the President shall be fixed from time to time by the Board of Directors. The salaries of the other officers shall be fixed from time to time by the Board of Directors, or by the President pursuant to authority delegated to him by the Board of Directors. No officer shall be prevented from receiving such salary by reason of the fact that he is also a director of the Company or a member of any committee contemplated by these By-laws. ARTICLE VI Contracts, Checks, Bank Accounts, etc. Section 1. Contracts, etc., How Executed. The Board of Directors, or any committee designated thereby with power so to act, except as in these By-laws otherwise provided, may authorize any officer or officers, agent or agents, 27 of the Company to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Company, and such authority may be general or confined to specific instances; and, unless so authorized by the Board of Directors or by such committee or by these By-laws, no officer, agent or employee shall have any power or authority to bind the Company by any contract or engagement or to pledge its credit or to render is liable pecuniarily for any purpose or to any amount. Section 2. Checks, Drafts, etc. All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the Company shall be signed by such officer or officers, employee or employees, of the Company as shall from time to time be determined by resolution of the Board of Directors or a committee designated thereby with power so to act or as provided in these By-laws. Each of such officers and employees shall give such bond, if any, as the Board of Directors or such committee shall require. Section 3. Deposits. All funds of the Company shall be deposited from time to time to the credit of the Company in such banks, trust companies or other depositaries as the Board of Directors or a committee designated thereby with power so to act may from time to time designate, or as 28 may be designated by any officer or officers of the Company to whom such power may be delegated by the Board of Directors, or by such committee, and, for the purpose of such deposit, the President, or any Vice-President, or the Treasurer, or any Assistant Treasurer, or the Secretary, or any Assistant Secretary, or any other person designated by the Board of Directors or the President, may endorse, assign and deliver checks, drafts, and other orders for the payment of money which are payable to the order of the Company. Section 4. General and Special Bank Accounts. The Board of Directors or any committee designated thereby with power so to act may from time to time authorize the opening and keeping with such banks, trust companies or other depositaries as it may designate of general and special bank accounts, and it may make such special rules and regulations with respect thereto, not inconsistent with the provisions of these By-laws, as it may deem expedient. Section 5. Proxies. When authorized by resolution of the Board of Directors or of any committee designated by the Board of Directors with power so to act, the President or any Vice-President may from time to time appoint an attorney or attorneys or agent or agents of the Company, in the name and on behalf of the Company, to cast the votes which the Company may be entitled to cast as a shareholder or 29 otherwise in any other corporation any of whose shares or other securities may be held by the Company, at meetings of the holders of the shares or other securities of such other corporation, or to consent in writing to any action by such other corporation, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Company and under its corporate seal, or otherwise, all such written proxies or other instruments as he may deem necessary or proper in the premises. ARTICLE VII Shares and Their Transfer Section 1. Certificates for Shares. Certificates for shares of the Company shall be in such form as shall be approved by the Board of Directors. They shall be issued in consecutive order and shall be numbered in the order of their issue, and shall be signed by the President or a Vice-President and the Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer of the Company, and sealed with the seal of the Company, and shall certify the number and class of paid-up shares held by the respective shareholders of the Company; provided, however, that where any such certificate is countersigned by a transfer agent who is not an employee 30 of the Company, or by a transfer clerk and by a registrar, the signatures of any such President, Vice-President, Secretary, Assistant Secretary, Treasurer or Assistant Treasurer, and the seal of the Company thereon, may be facsimiles, engraved, stamped or printed. In case any officer or officers who have signed, or whose facsimile signature or signatures have been used, printed or stamped on, any such certificate or certificates shall cease to be such officer or officers of the Company, whether because of death, resignation or otherwise, before such certificate or certificates shall have been delivered by the Company, such certificate or certificates, if authenticated by the endorsement thereon of the signature of a transfer agent or registrar, may nevertheless be adopted by the Company and used as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures have been used thereon had not ceased to be such officer or officers of the Company. The share record books and the blank share certificate books shall be kept by the Secretary or by a transfer agent or by a transfer clerk or by any other officer or agent designated by the Board of Directors. Section 2. Transfer of Shares. Transfers of shares of the Company shall be made only on the books of the 31 Company by the holder thereof, or by his attorney thereunto authorized by a power of attorney duly executed and filed with the Secretary of the Company or a transfer agent or a transfer clerk of the Company, if any, and on surrender of the certificate or certificates for such shares properly endorsed. The person in whose name shares stand on the books of the Company shall be deemed the owner thereof for all purposes as regards the Company. Section 3. Addresses of Shareholders. Each shareholder shall designate to the Secretary or transfer agent of the Company an address at which notices of meetings and all other corporate notices may be served or mailed to him, and, if any shareholder shall fail to designate such address, corporate notices may be served upon him by mail directed to him at his post-office address, if any, as the same appears on the share record books of the Company or at his last known post-office address. Section 4. Lost, Destroyed and Mutilated Certificates. The holder of any share of the Company shall immediately notify the Company of any loss, destruction or mutilation of the certificate therefor, and the Board of Directors or a committee designated thereby with power so to act may, in its discretion, cause to be issued to him a new certificate or certificates for shares, upon the surrender of the mutilated 32 certificate or, in the case of loss or destruction of the certificate, upon satisfactory proof of such loss or destruction, and the Board of Directors or such committee may, in its discretion, require the owner of the lost or destroyed certificate or his legal representative to give the Company a bond in such sum and with such surety or sureties as it may direct to indemnify the Company against any claim that may be made against it on account of the alleged loss or destruction of any such certificate. Section 5. Closing of Transfer Books: Record Date. The Board of Directors may, by resolution, direct that the stock transfer books of the Company be closed for a period not exceeding fifty (50) days preceding the date of any meeting of the shareholders, or the date for the payment of any dividends, or the date for the allotment of any rights, or the date when any change or conversion or exchange of stock of the Company shall go into effect, or for a period not exceeding fifty (50) days in connection with obtaining the consent of shareholders for any purpose. In lieu of closing the stock transfer books as aforesaid, the Board of Directors may fix in advance a date not exceeding fifty (50) days preceding the date of any meeting of the shareholders, or the date for the payment of any dividend, or the date for the allotment of any rights, or the date when any change or 33 conversion or exchange of stock of the Company shall go into effect, or a date in connection with obtaining such consent, as a record date for the determination of the shareholders entitled to notice of, and to vote at, any such meeting and any adjournment or adjournments thereof, or entitled to receive payment of any such dividend, or to receive such allotment of rights, or to exercise the rights in respect of any such change, conversion or exchange of stock, or to give such consent, and in each such case such shareholders and only such shareholders as shall be shareholders of record on the date so fixed shall be entitled to such notice of, and to vote at, such meeting and any adjournment or adjournments thereof, or to receive payment of such dividend, or to receive such allotment of rights, or to exercise such rights, or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the Company after any such record date fixed as aforesaid. Section 6. Examination of Books by Shareholders. The Board of Directors or any committee designated thereby with power so to act shall, subject to the laws of the State of Delaware, have power to determine, from time to time, whether and to what extent and under what conditions and regulations the accounts and books of the Company, or any of them, shall be open to inspection of the shareholders; and no 34 shareholder shall have any right to inspect any account or book or document of the Company, except as conferred by the laws of the State of Delaware, unless and until authorized so to do by resolution of the Board of Directors or such committee or of the shareholders of the Company. ARTICLE VIII Seal The Board of Directors shall provide a corporate seal, which shall be in the form of a circle and shall bear the words and figures "Cincinnati International Finance Corporation--Incorporated Delaware 1966", or such other words or figures as the Board of Directors may approve and adopt. ARTICLE IX Fiscal Year The fiscal year of the Company shall begin and end on such dates as shall be determined by the Board of Directors. ARTICLE X Waiver of Notice Whenever any notice whatever is required to be given by these By-laws or the Certificate of Incorporation of the Company or the laws of the State of Delaware, the person entitled thereto may, in person or by attorney thereunto 35 authorized, in writing or by telegraph, cable, radio or wireless, waive such notice, whether before or after the meeting or other matter in respect of which such notice is to be given, and in such event such notice need not be given to such person and such waiver shall be deemed equivalent to such notice. ARTICLE XI Amendments These By-laws, or any of them, may be altered, amended or repealed, or new By-laws may be made, at any annual or special meeting, by the shareholders having voting power, or at any regular or special meeting of the Board of Directors, by vote of a majority of the whole Board, provided that the proposed action in respect thereof shall be stated in the notice of such meeting. By-laws made, altered or amended by the Board shall be subject to alteration, amendment or repeal by the shareholders. ARTICLE XII Emergency By-Laws Those Emergency By-Laws shall, not withstanding any different provisions in the Delaware corporation law or the Articles of Incorporation or the By-Laws, be operative 36 during any emergency resulting from an attack on the United States or on a locality in which the Company conducts its business or customarily holds meetings of its Board of Directors or its stockholders, or any nuclear or atomic disaster, or during the existence of any catastrophe, or other similar emergency condition, as a result of which the quorum of the Board of Directors or a Standing committee thereof cannot readily be convened for action; however, these Emergency By-Laws shall not supercede any provision of said Articles of Incorporation or said By-Laws which is not in conflict with these Emergency By-Laws. During the existence of an emergency, special meetings of the Board of Directors may be called by any director or officer. The director or officer calling any such special meeting shall fix, and shall make a reasonable effort to notify all other directors of, the time and place of such special meeting, and such effort shall be deemed to constitute the giving of notice of such special meeting, and every director shall be deemed to have waived any requirement, of law or otherwise, that any other notice of such special meeting be given. At any such special meeting two directors shall constitute a quorum for the transaction of business including, without limiting the generality hereof, the filling of vacancies among directors and officers of the 37 Company and the election of additional Vice Presidents, Assistant Secretaries and Assistant Treasurers. The Act of a majority of the directors present thereat shall be the act of the Board of Directors. If at any such special meeting of the Board of Directors there shall be only one director present, such director present may adjourn the meeting from time to time until a quorum is obtained, and no further notice thereof need be given of any such adjournment. The directors present at any such special meeting shall make reasonable effort to notify all absent directors of any action taken thereat, but failure to give such notice shall not affect the validity of the action taken at any such meeting. All directors, officers, employees and agents of, and all persons dealing with, the Company, if acting in good faith, may conclusively rely upon any action taken at any such special meeting. To the extent required to constitute a quorum at any meeting of the Board of Directors during an emergency, the officers of the Company who are present shall be deemed, in order of rank of office and within the same rank in order of election or appointment to such offices, directors for such meeting. EX-3.9 7 y98028exv3w9.txt ARTICLE OF INCORPORATION EXHIBIT 3.9 ARTICLES OF INCORPORATION OF NORTHERN SUPPLY COMPANY, INC. I, the undersigned Incorporator, being a natural person of the full age of eighteen (18) years or more, for the purpose of forming a corporation under and pursuant to the provisions of Minnesota Statutes, Chapter 302A, and laws amendatory thereof and supplementary thereto, do hereby adopt the following Articles of Incorporation: ARTICLE 1 NAME 1.1 The name of the Corporation shall be NORTHERN SUPPLY COMPANY, INC. ARTICLE 2 REGISTERED OFFICE 2.1 The location and post office address of the registered office of the Corporation shall be 1101 Stinson Boulevard, Minneapolis, MN 55413. The registered office may be changed in the manner provided by law. ARTICLE 3 DURATION 3.1 The duration of the Corporation shall be perpetual. ARTICLE 4 PURPOSES AND POWERS 4.1 The purpose and powers of the Corporation shall be: a. General business purposes. b. Without limiting the generality of the foregoing and without limiting any express or implied business purpose set forth in Minnesota Statutes, to develop, manufacture, trade and deal in and with goods and services of any kind and nature whatsoever, including real estate, to acquire the assets, tangible or intangible, of any proprietorship, partnership or corporation, and to assume, in whole or in part, the liabilities or obligations of any such proprietorship, partnership or corporation. c. To borrow money and issue, sell or pledge bonds, promissory notes, bills of exchange, debentures, and other securities and obligations, and evidences of indebtedness, payable at a specified time or times, or payable upon the happening of a specified event or events, whether secured by a mortgage, pledge, or otherwise, or unsecured. d. To purchase, hold, sell, and transfer shares of the capital stock, bonds, and other obligations of this Corporation from time to time. e. To subscribe for, purchase, or otherwise acquire, and hold with the same rights of ownership therein, including the right to vote, as may be permitted to natural persons, the shares, bonds, and obligations of any corporation organized under the laws of any state or federal government. f. To have and exercise all powers incident and necessary to effect all the purposes of the Corporation, including the acquisition, retention, improvement, selling, dealing in and exercising of all rights of ownership over any and all kinds of personal and real property whatsoever, and wheresoever situated. g. To have and exercise all the powers, rights, and privileges now or hereafter conferred by the laws of the State of Minnesota, and to do all things set forth in these Articles to the same extent as natural persons might do. h. To enter into joint ventures, partnerships, or such other singular and combined business entities and relationships as may be in the best interest of the Corporation, and to have and exercise all powers incident and necessary to effectuate these relationships. The foregoing purposes and powers shall be construed liberally and shall in no way be limited or restricted by reference to or inference from the enumeration of specific powers or any other clause or paragraph of these Articles. ARTICLE 5 CAPITAL 5.1 Authorized Shares. The aggregate number of shares which the Corporation shall have authority to issue is twenty-five thousand (25,000) shares. The shares shall be without par value, except that the shares shall have a par value of one cent ($.01) per share solely for the purpose of statutes or regulations imposing a tax or fee based upon the capitalization of the Corporation, and shall have a par value fixed by the Board of Directors for the purpose of statutes or regulations requiring the shares of the Corporation to have a par value. 5.2 Cumulative Voting. Cumulative voting for directors is permitted in accordance with the laws of the State of Minnesota. 5.3 Pre-emptive Rights. Whenever the Corporation proposes to issue new or additional shares, or rights to purchase shares of the same class or series -2- as those held by a shareholder of the Corporation, or new or additional securities other than shares, or rights to purchase securities other than shares, that are exchangeable for, convertible into, or carry a right to acquire new or additional shares, of the same class or series as those held by a shareholder of the Corporation, such shareholder shall have the pre-emptive right to subscribe for and purchase such shareholder's pro rata portion of such new or additional shares or securities, as provided and except as limited by the laws of the State of Minnesota. 5.4 Classes, Series, Subscriptions, Rights, Options, and Conversions. In addition to, and not by way of limitation of, the powers granted to the Board of Directors by the laws of the State of Minnesota (and except as may be limited or restricted by such laws), the Board of Directors shall have the following authority and powers: a. To establish one or more than one class or series of shares of the Corporation, set forth the designation of classes or series of shares, and fix the relative rights end preferences of classes or series of shares. b. To accept or reject subscriptions for, authorize the issuance of, and issue securities of the Corporation and rights to purchase securities of the Corporation. c. To fix or alter, from time to time, the price, voting rights, dividend rate and rights, time and price of redemption, liquidation rights and price, conversion rights, sinking fund or purchase fund rights, par value, and other terms and features of any class or series of shares, including the number of shares constituting any class or series. d. To establish, authorize the issuance of, and grant rights, warrants, and options entitling the holders thereof to purchase from the Corporation shares of any class or series, or bonds, notes, debentures, or other obligations convertible into shares of any class or series. e. To establish, authorize the issuance of, and grant the right to convert any securities or rights to purchase securities of the Corporation into shares of any class or series. f. To establish and fix the terms, provisions, conditions, limitation, restrictions, bases, prices, and other features of subscriptions, rights to purchase securities, warrants, options, and securities convertible into shares of the Corporation. ARTICLE 6 SHAREHOLDER ACTION 6.1 The shareholders shall take action by the affirmative vote of the holders of a majority of the voting power of the shares present at a duly held -3- meeting and entitled to vote, except where a larger proportion or number is required for a particular action by the Articles of Incorporation or By-Laws of the Corporation or by the laws of the State of Minnesota. ARTICLE 7 BOARD ACTION 7.1 Majority Vote. The Board of Directors shall take action by the affirmative vote of a majority of directors present at a duly held meeting, except where the affirmative vote of a larger proportion or number of directors is required by the laws of the State of Minnesota. 7.2 Action Without Meeting. Any action required or permitted to be taken at a meeting of the Board of Directors may be taken without a meeting by written action signed by the number of directors that would be required to take the same action at a meeting of the board at which all directors were present, except as to those matters which require shareholder approval, on which matters the written action shall be signed by all members of the Board of Directors then in office. ARTICLE 8 AMENDMENTS 8.1 Articles of Incorporation. After the issuance of shares by the Corporation, the Articles of Incorporation may be amended when the proposed amendment is approved by the affirmative vote of the holders of a majority of the voting power of the shares present at a duly held meeting and entitled to vote, except that if the proposed amendment would require a larger majority, or if it would reduce an applicable larger majority, for approving shareholder action, the amendment must receive the larger of the majority required for passage prior to, or which would be required after, the enactment of the proposed amendment. 8.2 By-Laws. The Board of Directors shall have the power and authority to adopt, amend, or repeal By-Laws of the Corporation, subject to the power of the shareholders to adopt, amend, or repeal By-Laws; provided, however, that after the adoption of the initial By-Laws, the Board shall not adopt, amend, or repeal any By-Laws fixing a quorum for meetings of shareholders, prescribing procedures for removing directors or filling vacancies in the Board, or fixing the number of directors or their classifications, qualifications, or terms of office, but may adopt or amend By-Laws to increase the number of directors. ARTICLE 9 FIRST BOARD OF DIRECTORS 9.1 The name and address of the first director of the Corporation who shall serve as, and constitute, the Board of Directors until the first meeting -4- of the shareholders of the Corporation, or until his successor shall be elected and qualified is as follows: Michael C. DeZurik 105 County Road #73 Plymouth, MN 55441 ARTICLE 10 INCORPORATORS 10.1 The name and post office address of the person acting as Incorporator of the Corporation is as follows: Michael C. DeZurik 1101 Stinson Blvd. Minneapolis, MN 55413 IN WITNESS WHEREOF, I have subscribed my name this 22 day of JANUARY 1991. IN THE PRESENCE OF: NORTHERN SUPPLY COMPANY, INC. /s/ [ILLEGIBLE] /s/ Michael C. DeZurik - ----------------------- ---------------------------------------- Michael C. DeZurik STATE OF MINNESOTA ) ) SS COUNTY OF HENNEPIN ) On this 22nd day of January 1991, before me, a notary public within and for said county personally appeared Michael C. DeZurik to me known to be the person described in and who executed the foregoing instrument. /s/ Kristin M. Sather ---------------------------------------- Notary Public (Notary Seal) -5- State of Minnesota Office of the Secretary of State Notice of Change of Registered Office - Registered Agent or Both by Name of Corporation Northern Supply Company, Inc. Pursuant to Minnesota Statutes, Section 302A.123, 303.10, 317.19, 317A.123 or 308A.025 the undersigned hereby certifies that the Board of Directors of the above named Corporation has resolved to change the corporation's registered office and/or agent to: Agent's If you do not wish to designate an agent, you must list "NONE" in Name this box. DO NOT LIST THE CORPORATE NAME - -------------------------------------------------------------------------------- (You may not list a P.O. Box, but you may list a rural route and box number.) Address [ILLEGIBLE] [ILLEGIBLE] - -------------------------------------------------------------------------------- City County Zip [ILLEGIBLE] [ILLEGIBLE] MN [ILLEGIBLE] (If different from the address above -- P.O. Box not acceptable) - -------------------------------------------------------------------------------- Mailing [ILLEGIBLE] Address - -------------------------------------------------------------------------------- City County Zip MN - -------------------------------------------------------------------------------- The new address may not be a post office box. It must be a street address, pursuant to Minnesota Statutes, Section 302A.011, Subd. 3., 303.02 Subd. 5, 317.02 Subd. 13, 317A.01 Subd. 2. This change is effective on the day it is filed with the Secretary of State, unless you indicate another date, no later than 30 days after filing with the Secretary of State, in this box: [ ] I certify that I am authorized to execute this certificate and I further certify that I understand that by signing this certificate I am subject to the penalties of perjury as set forth in section 609.48 as if I had signed this certificate under oath. Name of Officer or Other Authorized Agent of Corporation Signature [ILLEGIBLE] [ILLEGIBLE] Title of Office Date [ILLEGIBLE] [ILLEGIBLE] Do not write below this line. For Secretary of State's use only. Receipt Number 806189 File Data D.A.R - -------------------------------------------------------------------------------- Filing Fee: $35.00 Return to: Business Services Division STATE OF MINNESOTA Office of the Secretary of State DEPARTMENT OF STATE 180 State Office Building FILED St. Paul, MN 55155 NOV 30 [ILLEGIBLE] (612) 296-2803 Make checks payable to: Secretary of State STATE OF MINNESOTA SECRETARY OF STATE NOTICE OF CHANGE OF REGISTERED OFFICE/ REGISTERED AGENT Please read the instructions on the back before completing this form. 1. Corporate Name: NORTHERN SUPPLY COMPANY, INC. - -------------------------------------------------------------------------------- 2. Registered Office Address (No. & Street): List a complete street address or rural route and rural route box number. A post office box is not acceptable. 1901 OAKCREST AVE ROSEVILLE MN 55113 - -------------------------------------------------------------------------------- Street city State Zip Code 3. Registered Agent (Registered agents are required for foreign corporations but optional for Minnesota corporations): NONE -------------------------------------------------------------------------- If you do not wish to designate an agent, you must list "NONE" in this box. DO NOT LIST THE CORPORATE NAME. In compliance with Minnesota Statutes, Section 302A.123, 303.10, 308A.025, 317A.123 or 322B.135 I certify that the above listed company has resolved to change the company's registered office and/or agent as listed above. I certify that I am authorized to execute this certificate and I further certify that I understand that by signing this certificate I am subject to the penalties of perjury as set forth in Minnesota Statutes Section 609.48 as if I had signed this certificate under oath. /s/ [ILLEGIBLE] - ------------------------------------------------ Signature of Authorized Person Name and Telephone Number of Contact Person: HAROLD J. PARTEN (612) 638-0888 ----------------------------------- please print legibly - -------------------------------------------------------------------------------- Filing Fee: Minnesota Corporations, Cooperatives and Office Use Only Limited Liability Companies: $35.00. Non-Minnesota Corporations: $50.00. STATE OF MINNESOTA DEPARTMENT OF STATE Make checks payable to Secretary of State FILED SEP 12 1997 Return to: Minnesota Secretary of State /s/ [ILLEGIBLE] 180 State Office Bldg. ------------------- 100 Constitution Ave. Secretary of State St. Paul, MN 55155-1299 (612)296-2803 427150 STATE OF MINNESOTA SECRETARY OF STATE NOTICE OF CHANGE OF REGISTERED OFFICE/ REGISTERED AGENT PLEASE READ THE INSTRUCTIONS ON THE BACK BEFORE COMPLETING THIS FORM. 1. Corporate Name: NORTHERN SUPPLY COMPANY, INC. - -------------------------------------------------------------------------------- 2. Registered Office Address (No. & Street): List a complete street address or rural route and rural route box number. A post office box is not acceptable. 405 SECOND AVENUE, SOUTH MINNEAPOLIS MN 55401 - -------------------------------------------------------------------------------- Street City State Zip Code 3. Registered Agent (Registered agents are required for foreign corporations but optional for Minnesota corporations): C T CORPORATION SYSTEM INC. - -------------------------------------------------------------------------------- If you do not wish to designate an agent, you must list "NONE" in this box. DO NOT LIST THE CORPORATE NAME. In compliance with Minnesota Statutes, Section 303A.123, 303.10, 308A.025, 317A.123 or 322B.135 I certify that the above listed company has resolved to change the company's registered office and/or agent as listed above. I certify that I am authorized to execute this certificate and I further certify that I understand that by signing this certificate I am subject to the penalties of perjury as set forth in Minnesota Statutes 609.48 as if I had signed this certificate under oath. /s/ Wayne F. Taylor - -------------------------------- Signature of Authorized Person Wayne F. Taylor, Secretary JANET WELLING c/o CT Name and Telephone Number of Contact Person: CORPORATION SYSTEM (800) 800-4447 ----------------------------------- please print legibly - -------------------------------------------------------------------------------- Office Use Only Filing Fee: Minnesota Corporations, Cooperatives and Limited Liability Companies: $35.00. STATE OF MINNESOTA DEPARTMENT OF STATE Non-Minnesota Corporations: $50.00. FILED JAN 19, 1999 Make checks payable to Secretary of State /s/ [ILLEGIBLE] ------------------- Return to: Minnesota Secretary of State Secretary of State 180 State Office Bldg. 100 Constitution Ave. St. Paul, MN 55155-1299 (612)296-2803 EX-3.10 8 y98028exv3w10.txt BYLAWS EXHIBIT 3.10 BY-LAWS OF NORTHERN SUPPLY COMPANY, INC. CONTENTS OF BY-LAWS OF NORTHERN SUPPLY COMPANY, INC. ARTICLE 1. OFFICES 1.1 Registered Office 1.2 Principal Executive Office ARTICLE 2. CORPORATE SEAL 2.1 Not Required 2.2 Form ARTICLE 3. SHAREHOLDERS 3.1 Regular Meetings 3.2 Demand by Shareholder: Regular Meetings 3.3 Special Meetings 3.4 Demand by Shareholder: Special Meetings 3.5 Notice of Meetings 3.6 Waiver of Notice 3.7 Quorum 3.8 Record Date 3.9 Voting of Shares 3.10 Voting for Directors 3.11 Voting of Shares by Certain Holders 3.12 Proxies 3.13 Conduct of Meetings 3.14 Shareholder Action Without a Meeting ARTICLE 4. BOARD OF DIRECTORS 4.1 Management Powers 4.2 Number 4.3 Election 4.4 Qualifications 4.5 Term of Office 4.6 Resignation 4.7 Removal 4.8 Vacancies 4.9 Regular Meetings 4.10 Special Meetings 4.11 Notice of Special Meetings 4.12 Waiver of Notice 4.13 Electronic Communications 4.14 Quorum 4.15 Board Action 4.16 Conduct of Meetings 4.17 Board Action Without a Meeting 4.18 Compensation 4.19 Committees 4.20 Litigation Committee 4.21 Absent Directors 4.22 Liability; Assent to Action 4.23 Conflicts of Interest ARTICLE 5. OFFICERS 5.1 Generally 5.2 Election and Term of Office 5.3 Resignation 5.4 Removal 5.5 Vacancies 5.6 Chairman of the Board 5.7 President 5.8 Vice President 5.9 Secretary 5.10 Treasurer 5.11 Assistant Officers 5.12 Delegation 5.13 Salaries and Contract Rights ARTICLE 6. SHARES AND THEIR TRANSFER 6.1 Subscriptions 6.2 Consideration 6.3 Certificates 6.4 Lost Certificates 6.5 Transfer of Shares 6.6 Reacquisition of Shares 6.7 Indebtedness of Shareholders 6.8 Transfer Restrictions 6.9 Pre-emptive Rights ARTICLE 7. BOOKS AND RECORDS 7.1 Corporate Records 7.2 Financial Records ARTICLE 8. FINANCIAL AND PROPERTY MANAGEMENT 8.1 Fiscal Year 8.2 Contracts 8.3 Banking 8.4 Loans and Guarantees 8.5 Voting Securities 8.6 Indemnification 8.7 Distributions ARTICLE 9. AMENDMENTS 9.1 Articles of Incorporation 9.2 By-Laws 9.3 Limitations BY-LAWS OF NORTHERN SUPPLY COMPANY, INC. ARTICLE 1 OFFICES 1.1 Registered Office. The registered office of the Corporation shall be 1101 Stinson Blvd., Minneapolis, Minnesota 55413. The Board of Directors shall have the authority to change the registered office of the Corporation from time to time, and any such change shall be made and filed with the Secretary of State of Minnesota in the manner provided by law. 1.2 Principal Executive Office. The Corporation shall have its principal executive office and such other business offices, either within or without the State of Minnesota, as the Board of Directors may designate or as the business of the Corporation any require from time to time. The principal executive office shall be the office where the President of the Corporation, or such other officer designated in these By-Laws as the chief executive officer of the Corporation, has his or her office. If such officer has no office, the principal executive office shall be deemed to be the registered office of the Corporation. ARTICLE 2 CORPORATE SEAL 2.1 Not Required. The Corporation may, but need not, have a corporate seal. The use or nonuse of a corporate seal shall not affect the validity, recordability, or enforceability of a document or action of the Corporation. If the Corporation has a corporate seal, the use of the seal by the Corporation on any document shall not be required. 2.2 Form. The corporate seal of the Corporation, if any, shall have inscribed thereon the words "Northern Supply Company, Inc." or any abbreviation thereof, and the word "Seal" or the words "Corporate Seal." One or more duplicate seals may be kept and used by the officers and designated agents of the Corporation. ARTICLE 3 SHAREHOLDERS 3.1 Regular Meetings. Regular meetings of the shareholders of the Corporation shall be held annually, within ninety (90) days following the end of each fiscal year of the Corporation, at such dates, times, and places as the President of the Corporation shall designate in the notices of such meetings. The shareholders at each regular meeting shall elect a Board of Directors for the ensuing year and shall transact such other business as is appropriate for shareholder action. Notwithstanding the foregoing, and except as provided in Section 3.2 below, regular meetings of shareholders need not be held if written action is taken by the shareholders in lieu thereof, pursuant to Section 3.14 of these By-Laws. 3.2 Demand by Shareholder: Regular Meetings. If a regular meeting of the shareholders has not been held during the immediately preceding fifteen (15) months, a shareholder or shareholders holding three percent (3%) or more of the voting power of all shares entitled to vote may demand a regular meeting of shareholders by written notice of demand given to the chief executive officer or the chief financial officer of the Corporation. Within thirty (30) days after receipt of the demand by one of said officers, the Board of Directors shall cause a regular meeting of shareholders to be called and held on notice no later than ninety (90) days after receipt of the demand, all at the expense of the Corporation. If the Board of Directors fails to cause a regular meeting to be called and held, the shareholder or shareholders making the demand may call the meeting by giving notice as required by Section 3.5 of these By-Laws, all at the expense of the Corporation. Any regular meeting called by or at demand of a shareholder or shareholders pursuant to this Section 3.2 shall be held in the county where the principal executive office of the Corporation is located. 3.3 Special Meetings. Special meetings of the shareholders, for any purpose or purposes, may be called at any time by: (a) The President or such other officer designated in these By-Laws as the chief executive officer of the Corporation; or (b) The Treasurer or such other officer designated in these By-Laws as the chief financial officer of the Corporation; or (c) Two or more directors of the Corporation. Special meetings shall be held at such dates, times, and places as the President of the Corporation shall designate in the notices of such meetings. Business transacted at a special meeting of shareholders shall be limited to the purposes stated in the notice of such meeting, unless all shareholders have waived notice of the meeting pursuant to Section 3.6 of these By-Laws. 3.4 Demand by Shareholder: Special Meetings. A shareholder or share- holders holding ten percent (10%) or more of the voting power of all shares entitled to vote may demand a special meeting of shareholders by written notice of demand given to the chief executive officer or the chief financial officer of the Corporation, containing the purposes of said meeting. Within thirty (30) days after receipt of the demand by one of said officers, the Board of Directors shall cause a special meeting of shareholders to be called and held on notice no later than ninety (90) days after receipt of the demand, all at the expense of the Corporation. If the Board of Directors fails to cause a special meeting to be called and held, the shareholder or shareholders making the demand may call the meeting by giving notice as required by Section 3.5 of these By-Laws, all at the expense of the Corporation. Any special meeting -2- called by, or it the demand of, a shareholder or shareholders pursuant to this Section 3.4 shall be held in the county where the principal executive office of the Corporation is located. 3.5 Notice of Meetings. The person or person calling any meeting of shareholders shall give written notice thereof, by delivery or mail, to every holder of shares entitled to vote, at least ten (10) days and not more than sixty (60) days before the date of the meeting. Each notice shall contain the date, time, and place of the meeting, and each notice of a special meeting shall contain a statement of the purposes of the meeting. Notice need not be given of any adjourned meeting if the date, time, and place of the adjourned meeting were announced at the time of the adjournment. 3.6 Waiver of Notice. A shareholder may waive notice of a meeting of shareholders, if given in writing before, at, or after the meeting. Attendance by a shareholder at a meeting is deemed a waiver of notice of that meeting, except where the shareholder objects at the beginning of the meeting to the transaction of business because the meeting was not lawfully called or convened, or objects before a vote on an item of business because the item may not lawfully be considered at that meeting and the shareholder does not participate in the consideration of said item at that meeting. 3.7 Quorum. The holders of a majority of the voting power of the shares entitled to vote at a meeting shall constitute a quorum for the transaction of business. If a quorum is present when a duly called or held meeting is convened, the shareholders present may continue to transact business until adjournment, even though the withdrawal of a shareholder or shareholders originally present leaves less than the voting power otherwise required for a quorum. 3.8 Record Date. The Board of Directors may fix a date not more than sixty (60) days before the date of a meeting of shareholders as the date for determination of the shareholders entitled to notice of and entitled to vote at the meeting. When a date is so fixed, only shareholders on that date are en- titled to notice of and permitted to vote at that meeting of shareholders. If the Board of Directors does not fix a date for such determination, all share- holders on the date of any notice shall be entitled to notice of and permitted to vote at the meeting called by such notice. 3.9 Voting of Shares. For purposes of any shareholder action, a share- holder shall have one vote for each share held. The shareholders shall take action by the affirmative vote of a majority of the voting power of the shares present and entitled to vote, except where the Articles of Incorporation or By-Laws of the Corporation or the laws of the State of Minnesota require a larger proportion or number. If a shareholder votes without designating the proportion or number of shares voted in a particular way, the shareholder is deemed to have voted all of the shares in that way. 3.10 Voting for Directors. Voting for directors shall be governed by the following rules: -3- (a) If Cumulative Voting Permitted. If the Articles of Incorporation permit, or are amended to permit, cumulative voting for directors, each shareholder entitled to vote for directors shall have the right to cumulate those votes in an election of directors by giving written notice of intent to cumulate such votes to any officer of the Corporation before the meeting, or to the presiding officer at the meeting at which the election is to occur, at any time before the election of directors at the meeting, in which case: (i) The presiding officer at the meeting shall announce, before the election of directors, that shareholders shall cumulate their votes; and (ii) Each shareholder shall cumulate those votes either by casting for one candidate the number of votes equal to the number of directors to be elected multiplied by the number of shares held by such shareholder, or by distributing all of those votes on the same principle among any number of candidates. (b) If Cumulative Voting not Permitted. If the Articles provide, or are amended to provide, that there shall be no cumulative voting for directors, each shareholder entitled to vote for directors shall have the right to cast the number of votes equal to the number of directors to be elected multiplied by the number of shares held by such shareholder, distributed evenly among the number of directors to be elected. 3.11 Voting of Shares by Certain Holders. The following rules shall apply to voting of shares by certain holders thereof: (a) Beneficial Owners. The Board of Directors may establish a procedure allowing shareholders to certify in writing that all or a portion of the shares registered in the name of such shareholders are held for the account of one or more beneficial owners. Upon receipt by the Corporation of the writing, the persons specified as beneficial owners, rather than the actual shareholders, shall be deemed the shareholders for the purposes specified in the writing. (b) Joint Owners. Shares owned by two or more joint tenants may be voted by any one of them, unless the Corporation receives written notice from any one of them denying the authority of another person to vote those shares. (c) Other Corporations. Shares of the Corporation registered in the name of another domestic or foreign corporation may be voted by the chief executive officer or another legal representative of that Corporation. -4- (d) Representatives. Shares under the control of a person in a capacity as a personal representative, administrator, executor, guardian, conservator, or attorney-in-fact may be voted by the person in such capacity, either in person or by proxy, without registration of those shares in the name of the person in such capacity. Shares under the control of a trustee of a trust or a custodian may be voted by such trustee or custodian, either in person or by proxy, only if such shares are registered in the name of such trustee or custodian. (e) Trustees in Bankruptcy. Shares registered in the name of a trustee in bankruptcy or a receiver may be voted by such trustee or receiver either in person or by proxy. Shares under the control of a trustee in bankruptcy or a receiver may be voted by such trustee or receiver without registration of the shares in the name of such trustee or receiver if authority to do so is contained in an appropriate order of the court by which such trustee or receiver was appointed. (f) Other Organizations. Shares registered in the name of a partnership, limited partnership, joint venture, association, business trust, enterprise, or other legal or commercial entity may be voted, either in person or by proxy, by the legal representatives of such organization. (g) Pledges. A shareholder whose shares are pledged may vote those shares unless and until such shares are registered in the name of the pledgee. 3.12 Proxies. The following rules shall apply to appointment and use of proxies by shareholders: (a) Authorization. A shareholder may cast or authorize the casting of a vote by filing a written appointment of a proxy with an officer of the Corporation at or before the meeting at which the appointment is to be effective. An appointment of a proxy for shares held jointly by two or more shareholders is valid if signed by any one of them, unless the Corporation receives from any one of those shareholders written notice either denying the authority of another person to appoint a proxy or appointing a different proxy. (b) Duration. The appointment of a proxy is valid for eleven (11) months, unless a longer period is expressly provided in the appointment. No appointment is irrevocable unless the appointment is coupled with an interest in the shares or in the Corporation. (c) Termination. An appointment may be terminated at will, unless the appointment is coupled with an interest, in which -5- case it shall not be terminated except in accordance with the terms of an agreement, if any, between the parties to the appointment. Termination may be made by filing written notice of the termination of the appointment with an officer of the Corporation, or by filing a new written appointment of a proxy with an officer of the Corporation. Termination in either manner revokes all prior proxy appointments and is effective when filed with an officer of the Corporation. (d) Revocation by Death or Incapacity. The death or incapacity of a person appointing a proxy does not revoke the authority of the proxy, unless written notice of the death or incapacity is received by an officer of the Corporation before the proxy exercises the authority under that appointment. (e) Multiple Proxies. Unless the appointment specifically provides otherwise, if two or more persons are appointed as proxies for a shareholder: (i) Any one of them may vote the shares on each item of business in accordance with specific instructions contained in the appointment; and (ii) If no specific instructions are contained in the appointment with respect to voting the shares on a particular item of business, the shares shall be voted as a majority of the proxies determine. If the proxies are equally divided, the shares shall not be voted. (f) Acceptance. Unless the appointment of a proxy contains a restriction, limitation, or specific reservation of authority, the Corporation may accept a vote or action taken by a person named in the appointment. The vote of a proxy is final, binding, and not subject to challenge, but the proxy is liable to the shareholder or beneficial owner for damages resulting from a failure to exercise the proxy or from an exercise of the proxy in violation of the authority granted in the appointment. 3.13 Conduct of Meetings. Meetings of shareholders shall be conducted in accordance with Roberts Rules of Order, Revised. If the Corporation has an officer designated as Chairman of the Board, the person holding that office shall preside over all meetings of shareholders. If the Corporation has no such officer, the President or such other officer designated in these By-Laws as the chief executive officer shall preside over all meetings of shareholders. In the absence of such officers at any meeting of shareholders, the shareholders present at the meeting shall appoint any person present to act as presiding officer of the meeting. The order of business at each regular meeting, and so far as possible, at special meetings of shareholders, shall be: -6- (a) Calling of roll. (b) Proof of notice or waivers. (c) Reading and approval of minutes of previous meetings or action of shareholders. (d) Reports. (e) Election of directors. (f) Unfinished business. (g) New business. (h) Adjournment. 3.14 Shareholder Action Without A Meeting. Any action required or permitted to be taken at a meeting of shareholders may be taken without a meeting by written action signed by all shareholders entitled to vote on such action. The written action is effective when it has been signed by all of such shareholders, unless a different effective time is set forth in the written action. ARTICLE 4 BOARD OF DIRECTORS 4.1 Management Powers. Subject to the provisions of law and of these By-Laws, the business property, and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. 4.2 Number. The number of directors of the Corporation shall be one or more. The number of directors may be increased by valid amendment of these By-Laws. The number of directors may be decreased by valid amendment of these By-Laws, subject, however, to the provisions of law and of these By-Laws respecting removal of directors. 4.3 Election. Directors shall be elected by the affirmative vote of the shareholders in the manner set forth in Section 3.10 of these By-Laws. 4.4 Qualifications. Directors shall be natural persons. Directors need not be shareholders or residents of the State of Minnesota. 4.5 Term of Office. Each director shall be elected for an indefinite term that shall expire at the next regular meeting of the shareholders. Each director shall hold office until a successor is elected and has qualified, or until the earlier death, resignation, removal, or disqualification of the director. 4.6 Resignation. A director may resign at any time by mailing or personally delivering written notice to the Corporation. The resignation is effective without acceptance when the notice is given to the Corporation, unless a later effective time is specified in the notice. No resignation may be effective prior to the time such notice is given. 4.7 Removal. The following rules shall apply to removal of directors in office: -7- (a) Removal by Directors. A director may be removed by the affirmative vote of a majority of the remaining directors, with or without cause, if the director so removed was named by the Board to fill a vacancy and the shareholders have not elected directors in the interval between such appointment and such removal. (b) Removal by Shareholders. Any one or all of the directors may be removed at any time, with or without cause, by the affirmative vote of the holders of the proportion or number of the voting power of the shares sufficient to elect said director or directors; provided, however, that if cumulative voting for directors is permitted, and unless the entire Board is removed simultaneously, a director may not be removed from the Board if there are cast against his or her removal votes of a proportion of the voting power sufficient to elect such director at an election of the entire Board under cumulative voting. 4.8 Vacancies. Any vacancy in the Board of Directors resulting from the death, resignation, removal, or disqualification of a director may be filled by the affirmative vote of a majority of the remaining directors, even though less than a quorum. Any vacancy resulting from newly created directorships may be filled by the affirmative vote of a majority of the directors serving at the time of the increase. New directors may be elected at the same meeting at which directors are removed, and, if such meeting is a meeting of shareholders and cumulative voting for directors is permitted, each shareholder shall be entitled to cumulate votes in the manner provided in Section 3.10 of these By-Laws. Any director elected to fill a vacancy shall hold office until a qualified successor is elected by the shareholders. 4.9 Regular Meetings. Regular meetings of the Board of Directors of the Corporation shall be held annually, immediately after and at the same location as the regular meeting of shareholders. No notice of such meetings need be given. The Board, by resolution, may provide for additional regular meetings without notice other than such resolution. Any regular meeting for which no location is specified shall be held at the principal executive office of the Corporation. 4.10 Special Meetings. Special meetings of the Board of Directors of the Corporation may be called by or at the request of the chief executive officer of the Corporation or by any two directors. 4.11 Notice of Special Meetings. The person or persons calling any special meeting of the Board shall give oral or written notice of such meeting to all directors at least seven (7) days before the date of the meeting. Each notice shall contain the date, time, and place of the meeting. Notices need not state the purpose of the meeting. No notice need be given of any special meeting if the date, time, and place thereof have been announced at a previous Board meeting. Notice of an adjourned meeting need not be given other than by announcement at the meeting at which adjournment is taken. -8- 4.12 Waiver of Notice. Directors may waive notice of any meeting of the Board before, at, or after the meeting, in writing, orally, or by attendance. Attendance at a meeting by a director shall constitute a waiver of notice of such meeting, unless such director objects at the beginning of the meeting to the transaction of business because the meeting is not validly called or convened, and does not participate thereafter in the meeting. 4.13 Electronic Communications. A conference telephone call, or other conference among directors by any means of communication through which the directors may simultaneously hear each other during the conference, shall constitute a meeting of the Board of Directors, provided that any notice or waiver requirements for a meeting are met and that the number of directors participating in the conference are sufficient to constitute a quorum at a meeting. Participation in such a conference shall constitute presence in person at the meeting. 4.14 Quorum. A majority of the directors currently holding office is a quorum for the transaction of business. In the absence of a quorum, a majority of the directors present may adjourn a meeting from time to time until a quorum is present. If a quorum is present when a duly called or held meeting is convened, the directors present may continue to transact business until adjournment, even though the withdrawal of a number of directors originally present leaves less than the proportion or number otherwise required for a quorum. 4.15 Board Action. The Board of Directors shall take action by the affirmative vote of a majority of directors present at a duly held meeting, except where the Articles of Incorporation or By-Laws of the Corporation or the laws of the State of Minnesota require a larger proportion or number. 4.16 Conduct of Meetings. Meetings of the Board of Directors shall be conducted in accordance with Roberts Rules of Order, Revised. If the Corporation has a Chairman of the Board, he or she shall preside at all meetings of the Board when present. In the absence of the Chairman, or if the Corporation has no such officer, the President shall preside at such meetings when present, otherwise, the directors present at the meeting shall appoint any of them to act as presiding officer of the meeting. The order of business at each regular meeting, and so far as possible at special meetings of the Board of Directors, shall be: (a) Calling of roll. (b) Proof of notice or waivers. (c) Reading and approval of minutes of previous meetings or action of the Board. (d) Reports of officers and committees. (e) Election of officers. (f) Unfinished business. (g) New business. (h) Adjournment. -9- 4.17 Board Action Without a Meeting. Any action required or permitted to be taken at a meeting of the Board of Directors may be taken without a meeting by written action signed by the number of directors that would be required to take the same action at a meeting of the Board at which all directors were present, except as to those matters which require shareholder approval, on which matters the written action shall be signed by all members of the Board of Directors then in office. All directors shall be notified immediately of the text and the effective date of any written action taken by less than all of them, but failure to provide such notice shall not invalidate the written action. Directors who do not sign or consent to written action taken by the Board shall have no liability for the action thereby taken. 4.18 Compensation. Directors and any members of committees established by the Board shall receive such compensation, if any, as may be provided for by resolution of the Board of Directors. Neither this Section nor such resolution shall preclude any director from serving the Corporation in any other capacity and receiving proper compensation therefor. 4.19 Committees. By resolution approved by the affirmative vote of a majority of the Board of Directors, the Board may establish committees having the authority of the Board in the management of the business of the Corporation, but only to the extent provided in such resolution. Committees shall be subject at all times to the direction and control of the Board (except as provided in Section 4.20 of these By-Laws). Committee members shall be natural persons and need not be directors. Committee members shall be appointed by Board action. 4.20 Litigation Committee. The Board of Directors shall have no authority to establish a committee of disinterested persons to determine whether to pursue or dismiss any legal proceeding on behalf of the Corporation, as described in Minn. Stat. 302A.243. 4.21 Absent Directors. A director may give advance written consent or opposition to a proposal to be acted on at a Board meeting. If the director is not present at the meeting, consent or opposition to a proposal does not constitute presence for purposes of determining the existence of a quorum, but consent or opposition shall be counted as a vote in favor of or against the proposal and shall be entered in the minutes or other record of action at the meeting if the proposal acted on at the meeting is substantially the same or has substantially the same effect as the proposal to which the director has consented or objected. 4.22 Liability; Assent to Action. Each director present at a meeting of the Board of Directors when an action is approved by the affirmative vote of a majority of the directors present is presumed to have assented to the action approved, for purposes of such director's liability by reason of being or having been a director of the Corporation, unless such director: (a) Objects at the beginning of the meeting to the transaction of business because the meeting is not lawfully called or convened and does not participate thereafter in the meeting, in which event, the director shall not be considered to be present at the meeting; -10- (b) Votes against the action at the meeting; or (c) Is prohibited by law or Section 4.23 of these By-Laws from voting on the action. 4.23 Conflicts of Interest. The following rules shall apply to the contracts or other transactions of the Corporation where a conflict of interest by one or more directors arises: (a) Procedure. A contract or other transaction between the Corporation and one or more directors, or between the Corporation and an organization in or of which one or more directors are directors, officers, or legal representatives or have a material financial interest, if not void or voidable because the director or directors or the other organizations are parties or because the director or directors are present at the meeting of shareholders or the Board of Directors or a committee at which the contract or transaction is authorized, approved, or ratified, if: (i) The contract or transaction was, and the person asserting the validity of the contract or transaction sustains the burden of establishing that the contract or transaction was, fair and reasonable as to the Corporation at the time it was authorized, approved, or ratified; or (ii) The material facts as to the contract or transaction as to the director's or directors' interest are fully disclosed or known to the shareholders and the contract or transaction is approved in good faith by the holders of a majority of the outstanding shares, but shares owned by the interested director or directors shall not be counted in determining the presence of a quorum and shall not be voted; or (iii) The material facts as to the contract or transaction and as to the director's or directors' interest are fully disclosed or known to the Board or a committee, and the Board or committee authorizes, approves, or ratifies the contract or transaction in good faith by a majority of the Board or committee, but the interested director or directors shall not be counted in determining the presence of a quorum and shall not vote; or (iv) The contract or transaction is a "distribution" described in Minn. Stat. Sec. 302A.61, Subd. 1 or Subd. 2. -11- (b) Material Financial Interest. For purposes of this Section (i) A director does not have a material financial interest in a resolution fixing the compensation of such director or fixing the compensation of another, director as a director, officer, employee, or agent of the Corporation, even though the first director is also receiving compensation from the Corporation; and (ii) A director has a material financial interest in each organization in which the director, or the spouse, parents, children and spouses of children, brothers and sisters and spouses of brothers and sisters of the director, or any combination of them have material financial interest. ARTICLE 5 OFFICERS 5.1 Generally. The Corporation shall have as its officers a President, one or more Vice-Presidents, a Secretary, a Treasurer, and such other officers, assistant officers and agents as the Board of Directors deems necessary for the operation and management of the Corporation, each of whom shall have the powers, rights, duties, responsibilities, and terms in office provided for in these By-Laws or, for offices established by the Board, as determined by Board resolution. Each officer shall be a natural person. Any number of offices may be held by the same person. Officers need not be directors or shareholders of the Corporation, except as provided in Section 5.8 below. 5.2 Election and Term of Office. The officers of the Corporation shall be elected by the Board of Directors at its regular meeting, and shall hold office until the next regular meeting of the Board and until their successors are elected and have qualified, or until the earlier death, resignation, removal, or disqualification of an officer. 5.3 Resignation. An officer may resign at any time by giving written notice to the Corporation. The resignation is effective without acceptance when the notice is given, unless a later effective date is specified in the notice. 5.4 Removal. An officer may be removed at any time, with or without cause, by a resolution approved by the affirmative vote of a majority of the directors present at a validly called meeting of the Board of Directors. Removal shall be without prejudice to contractual rights, if any, held by an officer. 5.5 Vacancies. A vacancy in an office because of death, resignation, removal, disqualification, or other cause shall be filled for the unexpired portion of the term by prompt action of the Board of Directors. 5.6 Chairman of the Board. The Corporation shall have no officer designated as Chairman of the Board unless, by amendment to these By-Laws, such an office is designated and described. -12- 5.7 President. The President shall be the chief executive officer of the Corporation and shall have general active management of the business of the Corporation; shall preside at meetings of the shareholders of the Corporation and at meetings of the Board of Directors; shall, with the direction and approval of the Board, establish and appoint members to committees from time to time; may execute and deliver in the name of the Corporation any deeds, mortgages, bonds, contracts or other instruments pertaining to the business of the Corporation, except in cases in which the authority to sign and deliver is required by law to be exercised by another person or is expressly delegated by the Board to some other officer or agent of the Corporation; may delegate the authority to execute and deliver documents to other officers of the Corporation; shall maintain records of and, whenever necessary, certify any proceedings of the shareholders and the Board; shall perform such other duties as may from time to time be prescribed by the Board; and, in general, shall perform all duties usually incident to the office of the President. 5.8 Vice President. Each Vice President shall have such powers and shall perform such duties as may be specified by the Board of Directors. In the event of absence or disability of the President, respective Vice Presidents shall succeed to the President's powers and duties in the order in which they are elected, or as otherwise prescribed by the Board, until the President shall resume his duties or until a new President is elected by the Board. A Vice President who is not a director shall not succeed to the powers and duties of the President. 5.9 Secretary. The Secretary shall serve as secretary of, and shall attend and record the proceedings of, all meetings of the shareholders of the Corporation and all meetings of the Board of Directors; shall maintain a register of the names and addresses of all shareholders of the Corporation; shall maintain to date and have custody of the permanent minute book and records of the Corporation; shall have custody of and affix the corporate seal, if any, where appropriate; shall attest to and certify any corporate documents and instruments; shall give notice and provide proof of notice of meetings and other proceedings of the shareholders and the Board in accordance with law and these By-Laws; shall, together with the President, sign certificates for shares and other securities of the Corporation authorized for issuance by the Board; shall have general responsibility for the transfer of shares and maintenance of the share transfer records of the Corporation; shall perform such other duties as may from time to time be prescribed by the Board or the President; and, in general, shall perform all duties usually incident to the office of Secretary. 5.10 Treasurer. The Treasurer shall be the chief financial officer of the Corporation and shall keep accurate financial records for the Corporation; shall deposit all money, drafts, and checks in the name of and to the credit of the Corporation in the banks and depositories designated by the Board of Directors; shall endorse for deposit all notes, checks, and drafts received by the Corporation as ordered by the Board, making proper vouchers therefor; shall disburse corporate funds and issue checks and drafts in the name of the Corporation, as ordered by the Board; shall render to the President and the Board, whenever requested, an account of all transactions by the Treasurer and of the financial condition of the Corporation; shall perform such other duties as may from time to time be prescribed by the President or the Board; and, in general, shall perform all duties usually incident to the office of Treasurer. -13- 5.11 Assistant Officers. If the Board of Directors shall establish and appoint assistant vice presidents, assistant secretaries, or assistant treasurers, such assistant officers shall have such powers and shall perform such duties as may be delegated to them by the Board, but each shall be subordinate to the principal officer to which such assistant officer is designated to assist. In the event of absence or disability of any Vice President, Secretary, or Treasurer, respective assistant officers shall succeed to the powers and duties of such principal officer in the order in which they are elected or as otherwise prescribed by the Board, until such principal officer shall resume his duties or until a replacement is elected by the Board. 5.12 Delegation. Except as may be prohibited by these By-Laws or by Board resolution, an officer may, without Board approval, delegate some or all of such officer's duties and powers to other persons. An officer who delegates the duties or powers to other persons. An officer who delegates the duties or powers of an office remains subject to the standard of conduct for an officer imposed by law with respect to the discharge of all duties and powers so delegated. 5.13 Salaries and Contract Rights. Salaries and other compensation to officers, if any, shall be fixed from time to time by the Board. Nothing in this section shall be construed to preclude an officer from receiving a salary by reason of the fact that he is also serving the Corporation in a paid or unpaid capacity as director, consultant, or other capacity. The election or appointment of a person as an officer or agent of the Corporation shall not, of itself, create contract rights. The Corporation may enter into a contract with an officer or agent for a period of time if, in the judgment of the Board, such contract is in the Corporation's best interests. The fact that a contract may be for a term longer than the terms of the election or appointment of an officer, or for a term longer than the terms of the directors who authorized or approved the contract, shall not make the contract void or voidable. ARTICLE 6 SHARES AND SHARE TRANSFER 6.1 Subscriptions. Subscriptions for shares shall be in writing and shall be signed by the subscribers. Each subscription for shares shall be irrevocable for a period of six (6) months, unless the subscription agreement provides for an earlier revocation or unless all persons holding subscriptions and all persons holding shares consent in writing to an earlier revocation. 6.2 Consideration. Shares may be issued for any consideration, including, without limitation, money or other tangible or intangible property received by the Corporation under a written agreement, or services rendered to the Corporation or to be rendered to the Corporation under a written agreement, as authorized by resolution approved by valid Board action or shareholder action. Such resolution shall value all non-monetary consideration and establish a price in money or other consideration, or a minimum price, or a general formula or method by which the price will be determined. The Corporation shall issue only shares that are non-assessable or that are assessable but are issued with the unanimous consent of the shareholders. "Non-assessable" shares are -14- shares for which the agreed consideration has been fully paid, delivered, or rendered to the Corporation. Consideration in the form of a promissory note, a check, or a written agreement to transfer property or render services to a Corporation in the future is fully paid when the note, check, or written agreement is delivered to the Corporation. 6.3 Certificates. Each shareholder shall be entitled to a certificate from the Corporation representing the shares owned by such shareholder. Certificates shall be numbered on their face in the order in which they are issued, shall state the name of the Corporation, shall contain a statement that the Corporation is incorporated under the laws of Minnesota, and shall state the name of the shareholder. Each certificate shall be signed in the name of the Corporation by the President, or by such other officers or agents as may be authorized by resolution of the Board of Directors. The Corporation shall maintain at its principal executive office, a record of each certificate issued, including the number, the person to whom issued, the number of shares represented by such certificate, the date of issuance, and the date of cancellation, if any. Each certificate surrendered to the Corporation for transfer or exchange shall be cancelled. No certificate shall be issued in exchange for or upon transfer of an existing certificate unless and until such existing certificate is cancelled, except as provided in Section 6.4 herein. A validly issued certificate shall be prima facie evidence of ownership of the shares represented by such certificate, for all purposes. 6.4 Lost Certificates. When an existing certificate for shares of the Corporation is alleged to have been lost, stolen, or destroyed, a new share certificate may be issued pursuant to Minn. Stat. Sec. 336.8-405, as amended. 6.5 Transfer of Shares. Unless a transfer agent for the Corporation is designated by affirmative resolution of the Board of Directors, the Corporation shall transfer its own shares. Transfer of shares may be authorized only by the shareholder named in the certificate for such shares, or by the shareholder's legal representative or duly authorized attorney-in-fact, upon proper evidence of such authority, and upon surrender of all certificates for the shares to be transferred, duly endorsed for transfer, or pursuant to Section 6.4 herein. 6.6 Reacquisition of Shares. The Corporation may acquire its own shares, subject to any restrictions or limitations imposed by law. Shares so acquired shall constitute authorized but unissued shares of the Corporation and shall be subject to all rights, terms, and provisions which apply to the issuance of authorized but unissued shares. 6.7 Indebtedness of Shareholders. The Corporation shall have a security interest in and a first lien upon its issued and outstanding shares, and upon all dividends declared on such shares, for the repayment of any indebtedness of the respective holders of such shares to the Corporation. 6.8 Transfer Restrictions. No shareholder shall be permitted to transfer his or her shares, whether by sale, exchange, gift, pledge, assignment, or other disposition, and whether or not for consideration, without first offering to sell such shares to the other shareholders and to the Corporation, in the following manner: -15- (a) To Other Shareholders. The other shareholders of the Corporation shall have a right of first refusal to purchase the shares proposed to be transferred, each in the proportion that his or her shares bear to the total shares owned by the other shareholders. The right shall exist for thirty (30) days after the date of such offer. The price of the shares shall be determined by agreement of the parties or by an independent appraiser selected by the parties, and if the parties cannot agree on a price or on an appraiser, the price may be established by evidence presented by the selling shareholder of the offer of any bona fide purchaser. If a price is not determined in this manner, the transfer shall not be permitted. If any shareholder purchases less than his or her allowed proportion of shares available, then the excess shares may be purchased by the remaining shareholders in the proportion determined above, after excluding the shares held by the non-buying shareholder. (b) To the Corporation. The Corporation shall have a right of second refusal to purchase any shares not purchased under subsection (a) above. The right shall exist for thirty (30) days after the date of the expiration of the refusal period under subsection (a). The price of the shares shall be the price determined under subsection (a). Any shares not purchased under subsections (a) or (b) above may be transferred to any parties; provided, however, that if the offering price under subsections (a) or (b) was determined by reference to the offer of a bona fide purchaser, the shares shall not be transferred for consideration less than such price. Each certificate issued for shares of the Corporation shall bear the following legend conspicuously on its face or back: "The sale, exchange, pledge, assignment, or other disposition of the shares represented by this certificate is subject to the transfer restrictions contained in the By-Laws of this Corporation, and reference should be made thereto for the terms of such restrictions." Nothing in this Section shall affect the transfer of shares as a result of the death of a shareholder or as a result of the dissolution, merger, or reorganization of a corporate shareholder. Any restrictions in this section may be waived in writing by the other shareholders, the Corporation, of all parties. 6.9 Pre-emptive Rights. When proposing the issuance of securities with respect to which shareholders have pre-emptive rights, the Board of Directors shall cause notice to be given to each shareholder entitled to pre-emptive rights at least ten (10) days prior to the date by which such rights must be exercised. Notice shall contain the following: -16- (a) The number or amount of securities with respect to which the shareholder has pre-emptive rights and the method used to determine such number or amount; (b) The price and other terms and conditions upon which the shareholder may purchase such securities; (c) The time within which and the method by which the shareholder must exercise the pre-emptive rights. A Shareholder may waive pre-emptive rights in writing, and such waiver shall be binding upon the shareholder whether or not consideration has been given therefor. A waiver is effective only for the proposed securities issuance described in such waiver, unless otherwise provided therein. This Section 6.9 shall have no application if the Articles of Incorporation deny, or are amended to deny, pre-emptive rights to acquire securities of the Corporation. ARTICLE 7 BOOKS AND RECORDS 7.1 Corporate Records. The Corporation shall keep at its principal executive office originals or copies of the following records and documents: (a) Articles of Incorporation and all amendments currently in effect; (b) By-Laws and all amendments currently in effect; (c) Minutes or records of all proceedings of shareholders for at least the last three (3) years or since the incorporation of the Corporation; (d) Minutes or records of all proceedings of the Board of Directors for at least the last three (3) years or since the incorporation of the Corporation; (e) A share register not more than one (1) year old, containing the names and addresses of the shareholders and the number and classes of shares held by each shareholder; (f) A share issuance and transfer record, showing the dates on which certificates representing shares were issued or transferred; (g) Reports made to shareholders generally within the last three (3) years; -17- (h) A statement of the names and usual business addresses of the Corporation's directors and principal officers; (i) Voting trust agreements described in Minn. Stat. Sec. 302A.453; (j) Shareholder control agreements described in Minn. Stat. Sec. 302A.457. Any shareholder, beneficial owner, or holder of a voting trust certificate shall have the right, upon written demand, to examine in person or by a legal representative, at any reasonable time, all records and documents referred to in this Section 7.1 unless the Corporation obtains a protective order permitting the Corporation to withhold portions of the records of proceedings of the Board. 7.2 Financial Records. The Corporation shall keep appropriate and complete financial records at its principal executive office. Upon the written request of any shareholder, the Corporation shall furnish to such shareholder copies of annual financial statements, including at least a balance sheet as of the end of each fiscal year and a statement of income for the fiscal year. If such statements are not audited by a public accountant, each copy shall be accompanied by a statement of the Treasurer of the Corporation stating his or her reasonable belief that the financial statements were prepared in accordance with accounting methods reasonable in the circumstances, describing the basis of presentation, and describing any respects in which the financial statements were not prepared on a basis consistent with those prepared for the previous year. If the Corporation has financial statements for its most recent interim period prepared in the course of operation, for distribution to shareholders or to a governmental agency as a matter of public record, such statements shall be kept available for inspection in the same manner as those records designated in Section 7.1 herein. ARTICLE 8 FINANCIAL AND PROPERTY MANAGEMENT 8.1 Fiscal Year. The fiscal year of the Corporation shall be established, from time to time, by resolution of the Board of Directors. 8.2 Contracts. The Board of Directors may authorize any officer or officers, agent or agents, to enter into any contract or execute and deliver any instrument or document in the name of and on behalf of the Corporation, and such authority may be general or confined to specific instances. 8.3 Banking. The Corporation shall establish by resolution of the Board of Directors a depository or depositories for funds of the Corporation, and all funds not in use shall be deposited therein. Checks, drafts, and other orders for the payment or withdrawal of money may be signed by the President or Treasurer of the Corporation, and by such other officers and agents of the Corporation as may from time to time be established by Board resolution. Loans may be obtained on behalf of the Corporation only upon the signature of those officers and agents so authorized by Board resolution. -18- 8.4 Loans and Guarantees. The Corporation may lend money to or guarantee the obligation of another party only if the transaction is approved by the Board and is either: (a) In the usual and regular course of business; or (b) With related corporations or organizations in which the Corporation has a financial interest or business relationship or to which the Corporation has the power to make donations; or (c) Is with an officer or employee of the Corporation and may reasonably be expected to benefit the Corporation; or (d) Is approved by the affirmative vote of the holders of two- thirds (2/3) of the outstanding shares. A loan or guaranty under this Section may be with or without interest and secured or unsecured, except as provided in Section 6.7 of these By-Laws. 8.5 Voting Securities. The President, or any other officers or agents of the Corporation designated by resolution of the Board of Directors, shall have full power and authority in the name of and on behalf of the Corporation, to attend, act, and vote at any meeting or proceeding of security holders of other corporations in which the Corporation holds securities. Such representatives shall possess and may exercise any and all rights and powers of the Corporation with respect to such securities. 8.6 Indemnification. The Corporation shall indemnify a person made or threatened to be made a party to a civil, criminal, administrative, arbitration, or investigative proceeding by reason of the former or present official capacity of the person, and shall pay or reimburse such person's expenses in advance of final disposition of a proceeding, all in accordance with the provisions and requirements of Minn. Stat. Sec. 302A.521, as amended. The Corporation may, by Board resolution, reimburse expenses, including attorneys' fees and disbursements, incurred by a person in connection with a proceeding at a time when such person is a witness but has not been made or threatened to be made a party to such proceeding. 8.7 Distributions. The Corporation, by authorizing resolution of the Board of Directors, shall have full power to make distributions in accordance with the provisions and requirements of Minn. Stat. Sec. 302A.551, as amended. ARTICLE 9 AMENDMENTS 9.1 Articles of Incorporation. The Articles of Incorporation of the Corporation may be amended at any time to include or modify any provision that is required or permitted to appear in articles by law, or to omit any provision not required to be included in articles by law. After the issuance of shares, the Articles may be amended as follows: -19- (a) Submission to Shareholders. A resolution approved by the Board of Directors, or proposed by a shareholder or shareholders holding three percent (3%) or more of the voting power of the shares entitled to vote, that sets forth the proposed amendment, shall be submitted to a vote at a meeting of shareholders. The written notice of the meeting of shareholders at which the amendment will be considered must set forth the substance of the proposed amendment. (b) Approval. The proposed amendment is adopted when approved by the affirmative vote of the holders of a majority of the voting power of the shares present at the meeting and entitled to vote, except that if the proposed amendment would require a larger majority, or if it would reduce an applicable larger majority, for approving shareholder action, the amendment must receive the larger of the majority required for passage prior to, or which would be required after, the enactment of the proposed amendment. 9.2 By-Laws. The By-Laws of the Corporation may be amended at any time to contain any provision relating to the management of the business or the regulation of the affairs of the Corporation not inconsistent with law or the Articles of Incorporation. After the adoption of the initial By-Laws, By-Laws may be adopted, amended, or repealed only by submission to and consideration and adoption by the shareholders of a resolution, in the same manner and with the same requirements and limitations as provided in Section 9.1 herein for amendment of the Articles of Incorporation. 9.3 Limitations. Notwithstanding anything to the contrary contained in this Section 9, no amendment to the Articles of Incorporation or By-Laws of the Corporation which has the effect of denying, limiting, or modifying an existing right to cumulative voting for directors, or which has the effect of denying, limiting, or modifying existing pre-emptive rights to acquire unissued securities, shall be adopted if the votes of a proportion of the voting power of the shares sufficient to elect a director at an election of the entire Board under cumulative voting are cast against the amendment. The undersigned, Secretary and sole officer of NORTHERN SUPPLY COMPANY, INC. hereby certifies that the foregoing sections were adopted as the By-Laws of the Corporation 9th day of July, 1991. /s/ Michael C. DeZirik ----------------------------------- Michael C. DeZirik - Secretary ATTESTED TO BY CORPORATE OFFICER: /s/ [ILLEGIBLE] - ----------------------------------- -20- EX-3.11 9 y98028exv3w11.txt ARTICLES OF INCORPORATION . . . EXHIBIT 3.11

1. CORPORATE NAME: NICKERSON MACHINERY CHICAGO INC. ----------------------------------------------------------------------------- (The corporate name must contain the word "corporation", "company", "incorporated", "limited" or an abbreviation thereof.) 2. Initial Registered Agent: GERARD H VERDINO -------------------------------------------------- First Name Middle initial Last name Initial Registered Office: 320 THORNDALE AVE -------------------------------------------------- Number Street Suite# BENSENVILLE IL 60106 -------------------------------------------------- City Zip Code County 3. Purpose or Purposes for which the corporation is organized: (If not sufficient space to cover this point, add one or more sheets of this size.) TO MANUFACTURE AND DISTRIBUTE PARTS AND ACCESSORIES FOR THE PLASTIC INJECTION MOLDING INDUSTRY 4. Paragraph 1: Authorized Shares, Issued Shares and Consideration Received:

Paragraph 2: The preferences, qualifications, limitations, restrictions and special or relative rights in respect of the shares of each class are: (If not sufficient space to cover this point, add one or more sheets of this size.) none (over) 5. OPTIONAL: (a) Number of directors constituting the initial board of directors of the corporation: ---------------------------- (b) Names and addresses of the persons who are to serve as directors until the first annual meeting of shareholders or until their successors are elected and qualify: Name Residential Address City, State, Zip ------------------------------------------------------------ ------------------------------------------------------------ ------------------------------------------------------------ ------------------------------------------------------------ 6. OPTIONAL: (a) It is estimated that the value of all property to be owned by the corporation for the following year wherever located will be: $ -------- (b) It is estimated that the value of the property to be located within the State of Illinois during the following year will be: $ -------- (c) It is estimated that the gross amount of business that will be transacted by the corporation during the following year will be: $ -------- (d) It is to estimated that the gross amount of business that will be transacted from places of business in the State of Illinois during the following year will be: $ -------- 7. OPTIONAL: OTHER PROVISIONS Attach a separate sheet of this size for any other provision to be included in the Articles of Incorporation, e.g., authorizing preemptive rights, denying cumulative voting, regulating internal affairs, voting majority requirements, fixing a duration other than perpetual, etc. 8. NAME(S) & ADDRESS(ES) OF INCORPORATOR(S) The undersigned incorporator(s) hereby declare(s), under penalties of perjury, that the statements made in the foregoing Articles of Incorporation are true. Date FEB 1, 1994 1994

(Signatures must be in ink on original document. Carbon copy, photocopy or rubber stamp signatures may only be used on conformed copies.) Note: If a corporation acts as incorporator, the name of the corporation and the state of incorporation shall be shown and the execution shall be by its president or vice president and verified by him, and attested by its secretary or assistant secretary. FEE SCHEDULE - - The initial franchise tax is assessed at the rate of 15/100 of 1 percent ($1.50 per $1,000) on the paid-in-capital represented in this state, with a minimum of $25. - - The filing fee is $75. - - The minimum total due (franchise tax + filing fee) is $100. (Applies when the Consideration to be Received as set forth in item 4 does not exceed $16,667) - - The Department of Business Services in Springfield will provide assistance in calculating the total fees if necessary. Illinois Secretary of State Springfield, IL 62756 Department of Business Services Telephone (217) 782-9522 782-9523 File# 5767-658-2 ----------------------------- Form BCA-5.10 NFP-105.10 (Rev. April 1995) ----------------------------- George H. Ryan Secretary of State Department of Business Services Springfield, IL. 62756 Telephone(217) 782-3647 http://www.state.Il.us [ILLEGIBLE] ----------------------------- This space for use by STATEMENT OF Secretary of State CHANGE FILED Date 8-4-99 OF REGISTERED AGENT AUG 04 1999 [ILLEGIBLE] AND/OR REGISTERED JESSE WHITE ------------------------ OFFICE SECRETARY OF STATE Approved: /s/ [ILLEGIBLE] ----------------------------- ------------------------ Remit payment in check or money order, payable to "Secretary of State." - -------------------------------------------------------------------------------- [ILLEGIBLE] 1. CORPORATE NAME: NICKERSON MACHINERY CHICAGO INC. PAID EXPEDITED AUG 05 1999 AUG 4 1999 2. STATE OR COUNTRY OF INCORPORATION: ILLINOIS SECRETARY OF STATE - -------------------------------------------------------------------------------- 3. Name and address of the registered agent and registered office as they appear on the records of the office of the Secretary of State (before change): Registered Agent GERARD H. VERDINO ----------------------------------------------------- First Name Middle Name Last Name Registered Office 820 THORNDALE AVENUE ----------------------------------------------------- Number Street Suite No. (A P.O. Box alone is not acceptable) BENSENVILLE 60106- DU PAGE ----------------------------------------------------- City ZIP Code County 4. Name and address of the registered agent and registered office shall be (after all changes herein reported): Registered Agent C T CORPORATION SYSTEM ----------------------------------------------------- First Name Middle Name Last Name Registered Office c/o C T CORPORATION SYSTEM, 208 S. Lasalle Street ----------------------------------------------------- Number Street Suite No. (A P.O. Box alone is not acceptable) Chicago 60604 Cook ----------------------------------------------------- City ZIP Code County 5. The address of the registered office and the address of the business office of the registered agent, as changed, will be identical. 6. The above change was authorized by: ("X" one box only) a. [x] By resolution duly adopted by the board of directors. (Note 5) b. [ ] By action of the registered agent. (Note 6) NOTE: When the registered agent changes, the signatures of both president and secretary are required. 7. (If authorized by the board of directors sign here. See Note 5) The undersigned corporation has caused this statement to be signed by its duly authorized officers, each of whom affirms, under penalties of perjury, that the facts stated herein are true. Dated July 27, 1999 NICKERSON MACHINERY CHICAGO INC. -------------------------------- (Exact Name of Corporation) attested by /s/ Hugh C. O'Donnell by /s/ Craig Messerknecht ---------------------------------- --------------------------------- (Signature of Secretary or (Signature of President or Vice Assistant Secretary) President) Hugh C. O'Donnell, Craig Messerknecht, Vice Secretary President ---------------------------------- --------------------------------- (Type or Print Name and Title) (Type or Print Name and Title) (If change of registered office by registered agent, sign here. See Note 5) The undersigned under penalties of perjury, that the facts stated herein are true. Dated_____________________,19_________ _________________________________________ (Signature of Registered Agent of Record) NOTES 1. The registered office may, but need not be the same as the principal office of the corporation. However the registered office and the office address of the registered agent must be the same. 2. The registered office must include a street or road address; a post office box number alone is not acceptable. 3. A corporation cannot act as its own registered agent. 4. If the registered office is changed from one county to another, then the corporation must file with the recorder of deeds of the new county a certified copy of the articles of incorporation and a certified copy of the statement of change of registered office. Such certified copies may be obtained ONLY from the Secretary of State. 5. Any change of registered agent must be by resolution adopted by the board of directors. The statement must then be signed by the president (or vice-president) and by the secretary (or an assistant secretary). 6. The registered agent may report a change of the registered office of the corporation for which he or she is registered agent. When the agent reports such a change, this statement must be signed by the registered agent. EX-3.12 10 y98028exv3w12.txt BYLAWS EXHIBIT 3.12 BYLAWS OF NICKERSON MACHINERY, CHICAGO INC. ADOPTED FEB 8, 1994 BYLAWS OF ARTICLE I OFFICES The principal office of the Corporation in the State of ILLINOIS shall be located in DUPAGE, County of ILLINOIS. The Corporation may have such other offices, either within or without the State of ILLINOIS, as the Board of Directors may designate or as the business of the Corporation may require from time to time. ARTICLE II SHAREHOLDERS SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be held on the 8th day in the month of FEB in each year, beginning with the year 1994, at the hour of 10 o'clock a.m., for the purpose of electing Directors and for the transaction of such other business as may come before the meeting. If the day fixed for the annual meeting shall be a legal holiday in the State of ILLINOIS, such meeting shall be held on the next succeeding business day. If the election of Directors shall not be held on the day designated herein for any annual meeting of the shareholders, or at any adjournment thereof, the Board of Directors shall cause the election to be held at a special meeting of the shareholders as soon thereafter as conveniently may be. SECTION 2. Special Meetings. Special meetings of the shareholders, for any purpose or purposes, unless otherwise prescribed by statute, may be called by the President or by the Board of Directors, and shall be called by the President at the request of the holders of not less than 70 percent (70%) of all the outstanding shares of the Corporation entitled to vote at the meeting. SECTION 3. Place of Meeting. The Board of Directors may designate any place, either within or without the State of IL, unless otherwise prescribed by statute, as the place of meeting for any annual meeting or for any special meeting. A waiver of notice signed by all shareholders entitled to vote at a meeting may designate any place, either within or without the State of IL, unless otherwise prescribed by statute, as the place for the holding of such meeting. If no designation is made, the place of meeting shall be the principal office of the Corporation. SECTION 4. Notice of Meeting. Written notice stating the place, day and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall unless otherwise prescribed by statute, be delivered not less than (2) two nor more than (5) five days before the date of the meeting, to each shareholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States Mail, addressed to the shareholder at his address as it appears on the stock transfer books of the Corporation, with postage thereon prepaid. SECTION 5. Closing of Transfer Books or Fixing of Record. For the purpose of determining shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or shareholders entitled to receive payment of any dividend, or in order to make a determination of shareholders for any other proper purpose, the Board of Directors of the Corporation may provide that the stock transfer books shall be closed for a stated period, but not to exceed in any case fifty (50) days. If the stock transfer books shall be closed for the purpose of determining shareholders entitled to notice of or to vote at a meeting of share-holders, such books shall be closed for at least (2) two days immediately preceding such meeting. In lieu of closing the stock transfer books, the Board of Directors may fix in advance a date as the record date for any such determination of shareholders, such date in any case to be not more than (2) two days and, in case of a meeting of shareholders, not less than (2) two days, prior to the date on which the particular action requiring such determination of shareholders is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders, or shareholders entitled to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the Board of Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of shareholders. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this section, such determination shall apply to any adjournment thereof. SECTION 6. Voting Lists. The officer or agent having charge of the stock transfer books for shares of the corporation shall make a complete list of the shareholders entitled to vote at each meeting of shareholders or any adjournment thereof, arranged in alphabetical order, with the address of and the number of shares held by each. Such list shall be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any shareholder during the whole time of the meeting for the purposes thereof. SECTION 7. Quorum. A majority of the outstanding shares of the Corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders. If less than a majority of the outstanding shares are represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally noticed. The shareholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum. SECTION 8. Proxies. At all meetings of shareholders, a shareholder may vote in person or by proxy executed in writing by the shareholder or by his duly authorized attorney-in-fact. Such proxy shall be filed with the secretary of the Corporation before or at the time of the meeting. A meeting of the Board of Directors may be had by means of a telephone conference or similar communications equipment by which all persons participating in the meeting can hear each other, and participation in a meeting under such circumstances shall constitute presence at the meeting. SECTION 9. Voting of Shares. Each outstanding share entitled to vote shall be entitled to one vote upon each matter submitted to a vote at a meeting of shareholders. SECTION 10. Voting of Shares by Certain Holders. Shares standing in the name of another corporation may be voted by such officer, agent or proxy as the Bylaws of such corporation may prescribe or, in the absence of such provision, as the Board of Directors of such corporation may determine. Shares held by an administrator, executor, guardian or conservator may be voted by him, either in person or by proxy, without a transfer of such shares into his name. Shares standing in the name of a trustee may be voted by him, either in person or by proxy, but no trustee shall be entitled to vote shares held by him without a transfer of such shares into his name. Shares standing in the name of a receiver may be voted by such receiver, and shares held by or under the control of a receiver may be voted by such receiver without the transfer thereof into his name, if authority so to do be contained in an appropriate order of the court by which such receiver was appointed. A shareholder whose shares are pledged shall be entitled to vote such shares until the shares have been transferred into the name of the pledgee, and thereafter the pledgee shall be entitled to vote the shares so transferred. Shares of its own stock belonging to the Corporation shall not be voted, directly or indirectly, at any meeting, and shall not be counted in determining the total number of outstanding shares at any given time. SECTION 11. Informal Action by Shareholders. Unless otherwise provided by law, any action required to be taken at a meeting of the shareholders, or any other action which may be taken at a meeting of the shareholders, may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by all of the shareholders entitled to vote with respect to the subject matter thereof. ARTICLE III BOARD OF DIRECTORS SECTION 1. General Powers. The business and affairs of the Corporation shall be managed by its Board of Directors. SECTION 2. Number, Tenure and Qualifications. The number of directors of the Corporation shall be fixed by the Board of Directors, but in no event shall be less than (2). Each director shall hold office until the next annual meeting of shareholders and until his successor shall have been elected and qualified. SECTION 3. Regular Meetings. A regular meeting of the Board of Directors shall be held without other notice than this By-Law immediately after, and at the same place as, the annual meeting of shareholders. The Board of Directors may provide, by resolution, the time and place for the holding of additional regular meetings without notice other than such resolution. SECTION 4. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the President or any two directors. The person or persons authorized to call special meetings of the Board of Directors may fix the place for holding any special meeting of the Board of Directors called by them. SECTION 5. Notice. Notice of any special meeting shall be given at least one (1) day previous thereto by written notice delivered personally or mailed to each director at his business address, or by telegram. If mailed, such notice shall be deemed to be delivered when deposited in the United States Mail so addressed, with postage thereon prepaid. If notice be given by telegram, such notice shall be deemed to be delivered when the telegram is delivered to the telegraph company. Any directors may waive notice of any meeting. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. SECTION 6. Quorum. A majority of the number of directors fixed by Section 2 of this Article III shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice. SECTION 7. Manner of Acting. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. SECTION 8. Action Without a Meeting. Any action that may be taken by the Board of Directors at a meeting may be taken without a meeting if a consent in writing, setting forth the action so to be taken, shall be signed before such action by all of the directors. SECTION 9. Vacancies. Any vacancy occurring in the Board of Directors may be filled by the affirmative vote of a majority of the remaining directors though less than a quorum of the Board of Directors, unless otherwise provided by law. A director elected to fill a vacancy shall be elected for the unexpired term of his predecessor in office. Any directorship to be filled by reason of an increase in the number of directors may be filled by election by the Board of Directors for a term of office continuing only until the next election of directors by the shareholders. SECTION 10. Compensation. By resolution of the Board of Directors, each director may be paid his expenses, if any, of attendance at each meeting of the Board of Directors, and may be paid a stated salary as director or a fixed sum for attendance at each meeting of the Board of Directors or both. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. SECTION 11. Presumption of Assent. A director of the Corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent to such action with the person acting as the Secretary of the meeting before the adjournment thereof, or shall forward such dissent by registered mail to the Secretary of the Corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action. ARTICLE IV OFFICERS SECTION 1. Number. The officers of the Corporation shall be a President, one or more Vice Presidents, a Secretary and a Treasurer, each of whom shall be elected by the Board of Directors. Such other officers and assistant officers as may be deemed necessary may be elected or appointed by the Board of Directors, including a Chairman of the Board. In its discretion, the Board of Directors may leave unfilled for any such period as it may determine any office except those of President and Secretary. Any two or more offices may be held by the same person, except for the offices of President and Secretary which may not be held by the same person. Officers may be directors or shareholders of the Corporation. SECTION 2. Election and Term of Office. The officers of the Corporation to be elected by the Board of Directors shall be elected annually by the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of the shareholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Each officer shall hold office until his successor shall have been duly elected and shall have qualified, or until his death, or until he shall resign or shall have been removed in the manner hereinafter provided. SECTION 3. Removal. Any officer or agent may be removed by the Board of Directors whenever, in its judgement, the best interests of the Corporation will be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed. Election or appointment of an officer or agent shall not of itself create contract rights, and such appointment shall be terminable at will. SECTION 4. Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or otherwise, may be filled by the Board of Directors for the unexpired portion of the term. SECTION 5. President. The President shall be the principal executive officer of the Corporation and, subject to the control of the Board of Directors, shall in general supervise and control all of the business and affairs of the Corporation. He shall, when present, preside at all meetings of the shareholders and of the Board of Directors, unless there is a Chairman of the Board, in which case the Chairman shall preside. He may sign, with the Secretary or any other proper officer of the Corporation thereunto authorized by the Board of Directors, certificates for shares of the Corporation, any deeds, mortgages, bonds, contracts, or other instruments which the Board of Directors has authorized to be executed, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors or by these Bylaws to some other officer or agent of the Corporation, or shall be required by law to be otherwise signed or executed; and in general shall perform all duties incident to the office of President and such other duties as may be prescribed by the Board of Directors from time to time. SECTION 6. Vice President. In the absence of the President or in event of his death, inability or refusal to act, the Vice President shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. The Vice President shall perform such other duties as from time to time may be assigned to him by the President or by the Board of Directors. If there is more than one Vice President, each Vice President shall succeed to the duties of the President in order of rank as determined by the Board of Directors. If no such rank has been determined, then each Vice President shall succeed to the duties of the President in order of date of election, the earliest date having the first rank. SECTION 7. Secretary. The Secretary shall: (a) keep the minutes of the proceedings of the shareholders and of the Board of Directors in one or more minute books provided for that purpose; (b) see that all notices are duly given in accordance with the provisions of these Bylaws or as required by law; (c) be custodian of the corporate records and of the seal of the Corporation and see that the seal of the Corporation is affixed to all documents, the execution of which on behalf of the Corporation under its seal is duly authorized; (d) keep a register of the post office address of each shareholder which shall be furnished to the Secretary by such shareholder; (e) sign with the President certificates for shares of the Corporation, the issuance of which shall have been authorized by resolution of the Board of Directors; (f) have general charge of the stock transfer books of the Corporation; and (g) in general perform all duties incident to the office of the Secretary and such other duties as from time to time may be assigned to him by the President or by the Board of Directors. SECTION 8. Treasurer. The Treasurer shall: (a) have charge and custody of and be responsible for all funds and securities of the Corporation; (b) receive and give receipts for moneys due and payable to the Corporation from any source what-soever, and deposit all such moneys in the name of the Corporation in such banks, trust companies or other depositories as shall be selected in accordance with the provisions of Article VI of these Bylaws; and (c) in general perform all of the duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him by the President or by the Board of Directors. If required by the Board of Directors, the Treasurer shall give a bond for the faithful discharge of his duties in such sum and with such sureties as the Board of Directors shall determine. SECTION 9. Salaries. The salaries of the officers shall be fixed from time to time by the Board of Directors, and no officer shall be prevented from receiving such salary by reason of the fact that he is also a director of the Corporation. ARTICLE V INDEMNITY The Corporation shall indemnify its directors, officers and employees as follows: (a) Every director, officer, or employee of the Corporation shall be indemnified by the Corporation against all expenses and liabilities, including counsel fees, reasonably incurred by or imposed upon him in connection with any proceeding to which he may be made a party, or in which he may become involved, by reason of his being or having been a director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of the corporation, partnership, joint venture, trust or enterprise, or any settlement thereof, whether or not he is a director, officer, employee or agent at the time such expenses are incurred, except in such cases wherein the director, officer, or employee is adjudged guilty of willful misfeasance or malfeasance in the performance of his duties; provided that in the event of a settlement the indemnification herein shall apply only when the Board of Directors approves such settlement and reimbursement as being for the best interests of the Corporation. (b) The Corporation shall provide to any person who is or was a director, officer, employee, or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of the corporation, partnership, joint venture, trust or enterprise, the indemnity against expenses of suit, litigation or other proceedings which is specifically permissible under applicable law. (c) The Board of Directors may, in its discretion, direct the purchase of liability insurance by way of implementing the provisions of this Article V. ARTICLE VI CONTRACTS, LOANS, CHECKS AND DEPOSITS SECTION 1. Contracts. The Board of Directors may authorize any officer or officers, agent or agents, to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Corporation, and such authority may be general or confined to specific instances. SECTION 2. Loans. No loans shall be contracted on behalf of the Corporation and no evidences of indebtedness shall be issued in its name unless authorized by a resolution of the Board of Directors. Such authority may be general or confined to specific instances. SECTION 3. Checks, Drafts, etc. All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the Corporation, shall be signed by such officer or officers, agent or agents of the Corporation and in such manner as shall from time to time be determined by resolution of the Board of Directors. SECTION 4. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation in such banks, trust companies or other depositories as the Board of Directors may select. ARTICLE VII CERTIFICATES FOR SHARES AND THEIR TRANSFER SECTION 1. Certificates for Shares. Certificates representing shares of the Corporation shall be in such form as shall be determined by the Board of Directors. Such certificates shall be signed by the President and by the Secretary or by such other officers authorized by law and by the Board of Directors so to do, and sealed with the corporate seal. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the stock transfer books of the Corporation. All certificates surrendered to the Corporation for transfer shall be cancelled and no new certificate shall be issued until the former certificate for a like number of shares shall have been surrendered and cancelled, except that in case of a lost, destroyed or mutilated certificate, a new one may be issued therefor upon such terms and indemnity to the Corporation as the Board of Directors may prescribe. SECTION 2. Transfer of Shares. Transfer of shares of the Corporation shall be made only on the stock transfer books of the Corporation by the holder of record thereof or by his legal representative, who shall furnish proper evidence of authority to transfer, or by his attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the Corporation, and on surrender for cancellation of the certificate for such shares. The person in whose name shares stand on the books of the Corporation shall be deemed by the Corporation to be the owner thereof for all purposes. Provided, however, that upon any action undertaken by the shareholders to elect S Corporation status pursuant to Section 1362 of the Internal Revenue Code and upon any shareholders agreement thereto restricting the transfer of said shares so as to disqualify said S Corporation status, said restriction on transfer shall be made a part of the bylaws so long as said agreement is in force and effect. ARTICLE VIII FISCAL YEAR The fiscal year of the Corporation shall begin on the 1st day of JANUARY and end on the 31st day of DECEMBER of each year. ARTICLE IX DIVIDENDS The Board of Directors may from time to time declare, and the Corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and its Articles of Incorporation. ARTICLE X CORPORATE SEAL The Board of Directors shall provide a corporate seal which shall be circular in form and shall have inscribed thereon the name of the Corporation and the state of incorporation and the words, "Corporate Seal". ARTICLE XI WAIVER OF NOTICE Unless otherwise provided by law, whenever any notice is required to be given to any shareholder or director of the Corporation under the provisions of these Bylaws or under the provisions of the Articles of Incorporation or under the provisions of the applicable Business Corporation Act, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. ARTICLE XII AMENDMENTS These Bylaws may be altered, amended or repealed and new Bylaws may be adopted by the Board of Directors at any regular or special meeting of the Board of Directors. The above Bylaws are certified to have been adopted by the Board of Directors of the Corporation on the 8th day of FEBRUARY, 1994 /s/ Peggy Leichman ------------------ Secretary EX-3.13 11 y98028exv3w13.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.13 STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 09:00 AM 10/11/1991 691284010 - 2276062 CERTIFICATE OF INCORPORATION OF PLIERS INTERNATIONAL INC. (A CLOSE CORPORATION) FIRST. The name of this corporation shall be: PLIERS INTERNATIONAL INC. SECOND. Its registered office in the State of Delaware is to be located at 1013 Centre Road, in the city of Wilmington, County of New Castle, and its registered agent at such address is Corporate Agents, Inc. THIRD. The purpose or purposes of the corporation shall be: To engage in any lawful act or activity for corporations under the General Corporation Law of Delaware. FOURTH. The total number of shares of stock which this corporation is authorized to issue is: One Thousand Five Hundred (1500) shares without par value FIFTH. The name and mailing address of the incorporator is as follows: Lisa G. Mulligan Corporate Agents, Inc. 1013 Centre Road Wilmington, Delaware 19805 SIXTH. The Board of Directors shall have the power to adopt, amend or repeal the by-laws. SEVENTH. All of the corporation's issued stock, exclusive of treasury shares, shall be held of record by not more than thirty persons. EIGHTH. All of the issued stock of all classes shall be subject to one or more of the restrictions on transfer permitted by Section 202 of the General Corporation Law. NINTH. The corporation shall make no offering of any of its stock of any class which would constitute a "public offering" within the meaning of the United States Securities Act of 1933, as it may be amended from time to time. IN WITNESS WHEREOF, the undersigned, being the incorporator hereinbefore named, has executed, signed and acknowledged this certificate this eleventh day of October, A.D. 1991. /s/ Lisa G. Mulligan -------------------------------- Lisa G. Mulligan Incorporator STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 04:00 PM 07/22/1999 991303118 - 2276062 CERTIFICATE OF CHANGE OF REGISTERED AGENT AND REGISTERED OFFICE ***** PLIERS INTERNATIONAL INC., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: The present registered agent of the corporation is CORPORATE AGENTS, INC. and the present registered office of the corporation is in the county of NEW CASTLE. The Board of Directors of PLIERS INTERNATIONAL INC. adopted the following resolution on the 21st day of July, 1999. Resolved, that the registered office of PLIERS INTERNATIONAL INC. in the state of Delaware be and it hereby is changed to Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle, and the authorization of the present registered agent of this corporation be and the same is hereby withdrawn, and THE CORPORATION TRUST COMPANY, shall be and is hereby constituted and appointed the registered agent of this corporation at the address of its registered office. IN WITNESS WHEREOF, PLIERS INTERNATIONAL INC. has caused this statement to be signed by Hugh C. O'Donnell, its Secretary, this 21st day of July, 1999. /s/ Hugh C. O'Donnell --------------------------------- Signature Hugh C. O'Donnell Secretary EX-3.14 12 y98028exv3w14.txt BYLAWS EXHIBIT 3.14 BY-LAWS of PLIERS INTERNATIONAL INC. A Delaware Corporation Adopted: October 13, 1991 Secretary: /s/ Peggy Leichman ------------------------- Peggy Leichman, Secretary BY-LAWS TABLE OF CONTENTS ARTICLE I - STOCKHOLDERS........................................................................ 1 SECTION 1.1. ANNUAL MEETING..................................................................... 1 SECTION 1.2. SPECIAL MEETINGS................................................................... 1 SECTION 1.3. NOTICE OF MEETING.................................................................. 1 SECTION 1.4. QUORUM............................................................................. 2 SECTION 1.5. VOTING AND PROXIES................................................................. 2 SECTION 1.6. ACTION AT MEETING.................................................................. 2 SECTION 1.7. ACTION WITHOUT MEETING............................................................. 2 SECTION 1.8. VOTING OF SHARES OF CERTAIN HOLDERS................................................ 2 SECTION 1.9. STOCKHOLDER LISTS.................................................................. 3 ARTICLE II - BOARD OF DIRECTORS................................................................. 3 SECTION 2.1. POWERS............................................................................. 3 SECTION 2.2. NUMBER OF DIRECTORS; QUALIFICATIONS................................................ 4 SECTION 2.3. NOMINATION OF DIRECTORS............................................................ 5 SECTION 2.4. ELECTION OF DIRECTORS.............................................................. 5 SECTION 2.5. VACANCIES; REDUCTION OF THE BOARD.................................................. 5 SECTION 2.6. ENLARGEMENT OF THE BOARD........................................................... 5 SECTION 2.7. TENURE AND RESIGNATION............................................................. 5 SECTION 2.8. REMOVAL............................................................................ 6 SECTION 2.9. MEETINGS........................................................................... 6 SECTION 2.10. NOTICE OF MEETING................................................................. 6 SECTION 2.11. AGENDA............................................................................ 6 SECTION 2.12. QUORUM............................................................................ 7 SECTION 2.13. ACTION AT MEETING................................................................. 7 SECTION 2.12. ACTION WITHOUT MEETING............................................................ 7 SECTION 2.15. COMMITTEES........................................................................ 7 ARTICLE III. OFFICERS........................................................................... 7 SECTION 3.1. ENUMERATION........................................................................ 7 SECTION 3.2. ELECTION........................................................................... 8 SECTION 3.3. QUALIFICATION...................................................................... 8 SECTION 3.4. TENURE............................................................................. 8 SECTION 3.5. REMOVAL............................................................................ 8 SECTION 3.6. RESIGNATION........................................................................ 8 SECTION 3.7. VACANCIES.......................................................................... 8 SECTION 3.8. PRESIDENT.......................................................................... 8 SECTION 3.9. VICE-PRESIDENT(S).................................................................. 8 SECTION 3.10. TREASURER AND ASSISTANT TREASURERS................................................ 8 SECTION 3.11. SECRETARY AND ASSISTANT SECRETARIES............................................... 9 SECTION 3.12 OTHER POWERS AND DUTIES............................................................ 9

-i- ARTICLE IV. - CAPITAL STOCK..................................................................... 9 SECTION 4.1. STOCK CERTIFICATES................................................................. 9 SECTION 4.2. TRANSFER OF SHARES................................................................. 10 SECTION 4.3. RECORD HOLDERS..................................................................... 10 SECTION 4.4. RECORD DATE........................................................................ 10 SECTION 4.5. TRANSFER AGENT AND REGISTRAR FOR SHARES OF CORPORATION............................. 11 SECTION 4.6. LOSS OF CERTIFICATES............................................................... 11 SECTION 4.7. RESTRICTIONS ON TRANSFER........................................................... 11 SECTION 4.8. MULTIPLE CLASSES OF STOCK.......................................................... 12 ARTICLE V. - DIVIDENDS.......................................................................... 12 SECTION 5.1. DECLARATION OF DIVIDENDS........................................................... 12 SECTION 5 2. RESERVES........................................................................... 12 ARTICLE VI. - POWERS OF OFFICERS TO CONTRACT WITH THE CORPORATION............................... 12 ARTICLE VII. - INDEMNIFICATION.................................................................. 13 SECTION 7.1. DEFINITIONS........................................................................ 13 SECTION 7.2. RIGHT TO INDEMNIFICATION IN GENERAL................................................ 15 SECTION 7.3. PROCEEDINGS OTHER THAN PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION........... 15 SECTION 7.4. PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION.................................. 15 SECTION 7.5. INDEMNIFICATION OF A PARTY WHO IS WHOLLY OR PARTLY SUCCESSFUL...................... 16 SECTION 7.6. INDEMNIFICATION FOR EXPENSES OF A WITNESS.......................................... 16 SECTION 7.7. ADVANCEMENT OF EXPENSES............................................................ 16 SECTION 7.8. NOTIFICATION AND DEFENSE OF CLAIM.................................................. 17 SECTION 7.9. PROCEDURES......................................................................... 18 SECTION 7.10. ACTION BY THE CORPORATION......................................................... 18 SECTION 7.11. NON-EXCLUSIVITY................................................................... 19 SECTION 7.12. INSURANCE......................................................................... 19 SECTION 7.13. NO DUPLICATIVE PAYMENT............................................................ 19 SECTION 7.14. EXPENSES OF ADJUDICATION.......................................................... 19 SECTION 7.15. SEVERABILITY...................................................................... 19 ARTICLE VIII.................................................................................... 20 SECTION 8.1 RESTRICTION ON TRANSFER............................................................. 20 SECTION 8.2 EXCEPTION FOR AUTHORIZED TRANSFEREES................................................ 20 SECTION 8.3 VOLUNTARY TRANSFERS................................................................. 20 SECTION 8.4 TRANSFER EVENTS..................................................................... 21 SECTION 8.5 FIRST RIGHT OF PURCHASE............................................................. 21 SECTION 8.6 TRANSFERS IN VIOLATION OF ARTICLE................................................... 22 SECTION 8.7 PURCHASE PRICE...................................................................... 22 SECTION 8.8 TENDERS............................................................................. 23 SECTION 8.9 WAIVER, DISPOSITION OF STOCK........................................................ 23 SECTION 8.10 NOTICES............................................................................ 23

-ii- ARTICLE IX - MISCELLANEOUS PROVISIONS........................................................... 24 SECTION 9.1. CERTIFICATE OF INCORPORATION....................................................... 24 SECTION 9.2. FISCAL YEAR........................................................................ 24 SECTION 9.3. CORPORATE SEAL..................................................................... 24 SECTION 9.4. EXECUTION OF INSTRUMENTS............................................................ 24 SECTION 9.5. VOTING OF SECURITIES............................................................... 24 SECTION 9.6. EVIDENCE OF AUTHORITY.............................................................. 24 SECTION 9.7. CORPORATE RECORDS.................................................................. 24 SECTION 9.8. CHARITABLE CONTRIBUTIONS........................................................... 25 ARTICLE X. - AMENDMENTS......................................................................... 25 SECTION 10.1. AMENDMENT BY STOCKHOLDERS......................................................... 25 SECTION 10.2. AMENDMENT BY BOARD OF DIRECTORS................................................... 25

-iii- BY-LAWS OF PLIERS INTERNATIONAL ARTICLE I Stockholders Section 1.1. Annual Meeting. The annual meeting of the stockholders of the corporation shall be held on such date as shall be fixed by The Board of Directors, at such time and place within or without the State of Delaware as may be designated in the notice of meeting. If the day fixed for the annual meeting shall fall on a legal holiday, the meeting shall be held on the next succeeding day not a legal holiday. If the annual meeting is omitted on the day herein provided, a special meeting may be held in place thereof, and any business transacted at such special meeting in lieu of annual meeting shall have the same effect as if transacted or held at the annual meeting. Section 1.2. Special Meetings. Special meetings of the stockholders may be called at any time by the president or by the board of directors. Special meetings of the stockholders shall be held at such time, date and place within or outside of the State of Delaware as may be designated in the notice of such meeting. Section 1.3. Notice of Meeting. A written notice stating the place, date, and hour of each meeting of the stockholders, and, in the case of a special meeting, the purposes for which the meeting is called, shall be given to each stockholder entitled to vote at such meeting, and to each stockholder who, under the Certificate of Incorporation or these By-laws, is entitled to such notice, by delivering such notice to such person or leaving it at their residence or usual place of business, or by mailing it, postage prepaid, and addressed to such stockholder at his address as it appears upon the books of the corporation, at least ten (10) days and not more than sixty (60) before the meeting. Such notice shall be given by the secretary, an assistant secretary, or any other officer or person designated either by the secretary or by the person or persons calling the meeting. The requirement of notice to any stockholder may be waived (i) by a written waiver of notice, executed before or after the meeting by the stockholder or his attorney thereunto duly authorized, and filed with the records of the meeting, (ii) if communication with such stockholder is unlawful, (iii) by attendance at the meeting without protesting prior thereto or at its commencement the lack of notice, or (iv) as otherwise excepted by law. A waiver of notice of any regular or special meeting of the stockholders need not specify the purposes of the meeting. -1- If a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place are announced at the meeting at which the adjournment is taken, except that if the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. Section 1.4. Quorum. The holders of a majority in interest of all stock issued, outstanding and entitled to vote at a meeting shall constitute a quorum. Any meeting may be adjourned from time to time by a majority of the votes properly cast upon the question, whether or not a quorum is present. Section 1.5. Voting and Proxies. Stockholders shall have one vote for each share of stock entitled to vote owned by them of record according to the books of the corporation, unless otherwise provided by law or by the Certificate of Incorporation. Stockholders may vote either in person or by written proxy, but no proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. Proxies shall be filed with the secretary of the meeting, or of any adjournment thereof. Except as otherwise limited therein, proxies shall entitle the persons authorized thereby to vote at any adjournment of such meeting. A proxy purporting to be executed by or on behalf of a stockholder shall be deemed valid unless challenged at or prior to its exercise and the burden of proving invalidity shall rest on the challenger. A proxy with respect to stock held in the name of two or more persons shall be valid if executed by one of them unless at or prior to exercise of the proxy the corporation receives a specific written notice to the contrary from any one of them. Section 1.6. Action at Meeting. When a quorum is present at any meeting, a plurality of the votes properly cast for election to any office shall elect to such office, and a majority of the votes properly cast upon any question other than election to an office shall decide such question, except where a larger vote is required by law, the Certificate of Incorporation or these by-laws. No ballot shall be required for any election unless requested by a stockholder present or represented at the meeting and entitled to vote in the election. Section 1.7. Action Without Meeting. Any action required or permitted to be taken at any meeting of the stockholders may be taken without a meeting without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of the minimum number of votes necessary to authorize or take such action at a meeting at which shares entitled to vote thereon were present and voted and copies are delivered to the corporation in the manner prescribed by law. Section 1.8. Voting of Shares of Certain Holders. Shares of stock of the corporation standing in the name of another corporation, domestic or foreign, may be voted by such officer, agent, or proxy as the by-laws of such corporation may prescribe, or, in the absence of such provision, as the board of directors of such corporation may determine. Shares of stock of the corporation standing in the name of a deceased person, a minor ward or an incompetent person, may be voted by his administrator, executor, court-appointed -2- guardian or conservator without a transfer of such shares into the name of such administrator, executor, court appointed guardian or conservator. Shares of capital stock of the corporation standing in the name of a trustee or fiduciary may be voted by such trustee or fiduciary. Shares of stock of the corporation standing in the name of a receiver may be voted by such receiver, and shares held by or under the control of a receiver may be voted by such receiver without the transfer thereof into his name if authority so to do be contained in an appropriate order of the court by which such receiver was appointed. A stockholder whose shares are pledged shall be entitled to vote such shares unless in the transfer by the pledger on the books of the corporation he expressly empowered the pledgee to vote thereon, in which case only the pledgee or its proxy shall be entitled to vote the shares so transferred. Shares of its own stock belonging to this corporation shall not be voted, directly or indirectly, at any meeting and shall not be counted in determining the total number of outstanding shares at any given time, but shares of its own stock held by the corporation in a fiduciary capacity may be voted and shall be counted in determining the total number of outstanding shares. Section 1.9. Stockholder Lists. The secretary (or the corporation's transfer agent or other person authorized by these By-laws or by law) shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. ARTICLE III. Board of Directors Section 2.1. Powers. Except as reserved to the stockholders by law, by the Certificate of Incorporation or by these By-laws, the business of the corporation shall be managed under the direction of the board of directors, who shall have and may exercise all of the powers of the corporation. Section 2.2. Number of Directors; Qualifications. The board of directors shall consist of such number of directors, not less than 1 nor more than 5 as shall be fixed initially by the incorporator and thereafter by the board of directors. No director need be a stockholder. -3- Section 2.3. Nomination of Directors. (a) Nominations for the election of directors may be made by the board of directors or by any stockholder entitled to vote for the election of directors. Nominations by stockholders shall be made by notice in writing, delivered or mailed by first class United States mail, postage prepaid, to the secretary of the corporation not less than 14 days nor more man 60 days prior to any meeting of the stockholders called for the election of directors; provided, however, that if less than 21 written days' notice of the meeting is given to stockholders, such notice of nomination by a stockholder shall be delivered or mailed, in the manner prescribed above, to the secretary of the corporation not later than the close of the fifth day following the day on which notice of the meeting was mailed to stockholders. (b) Each notice under subsection (a) shall set forth (i) the name, age, business address and, if known, residence address of each nominee proposed in such notice, (ii) the principal occupation or employment of each such nominee, and (iii) the number of shares of stock of the corporation which are beneficially owned by each such nominee. (c) The chairman of the meeting of stockholders shall determine whether or not a nomination was made in accordance with the procedures of this Section 2.3, and if he shall determine that it was not, he shall so declare to the meeting and the defective nomination shall be disregarded. Section 2.4. Election of Directors. The initial Board of directors shall be designated in the certificate of incorporation, or if not so designated, elected by the incorporator at the first meeting thereof. Thereafter, directors shall be elected by the stockholders at their annual meeting or at any special meeting the notice of which specifies the election of directors as an item of business for such meeting. Section 2.5 Vacancies; Reduction of the Board. Any vacancy in the board of directors, however occurring, including a vacancy resulting from the enlargement of the board of directors, may be filled by the stockholders or by the directors then in office or by a sole remaining director. In lieu of filling any such vacancy the stockholders or board of directors may reduce the number of directors, but not to a number less than one(1). When one or more directors shall resign from the board of directors, effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective. Section 2.6. Enlargement of the Board. The board of directors may be enlarged by the stockholders at any meeting or by vote of a majority of the directors then in office. Section 2.7. Tenure and Resignation. Except as otherwise provided by law, by the Certificate of Incorporation or by these By-laws, directors shall hold office until the next annual meeting of stockholders and thereafter until their successors are chosen and qualified. Any director may resign by delivering or mailing postage prepaid a written resignation to the corporation -4- at its principal office or to the president, secretary or assistant secretary, if any. Such resignation shall be effective upon receipt unless it is specified to be effective at some other time or upon the happening of some other event. Section 2.8. Removal. A director, whether elected by the stockholders or directors, may be removed from office with or without cause at any annual or special meeting of stockholders by vote of a majority of the stockholders entitled to vote in the election of such directors, or for cause by a vote of a majority of the directors then in office; provided, however, that a director may be removed for cause only after reasonable notice and opportunity to be heard before the body proposing to remove him. Section 2.9. Meetings. Regular meetings of the board of directors may be held without call or notice at such times and such places within or without the State of Delaware as the board may, from time to time, determine, provided that notice of the first regular meeting following any such determination shall be given to directors absent from such determination. A regular meeting of the board of directors shall be held without notice immediately after, and at the same place as, the annual meeting of the stockholders or the special meeting of the stockholders held in place of such annual meeting, unless a quorum of the directors is not then present. Special meetings of the board of directors may be held at any time and at any place designated in the call of the meeting when called by the president, treasurer, or one or more directors. Members of the board of directors or any committee elected thereby may participate in a meeting of such board or committee by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other at the same time, and participation by such means shall constitute presence in person at the meeting. Section 2.10. Notice of Meeting. It shall be sufficient notice to a director to send notice by mail at least seventy-two (72) hours before the meeting addressed to such person at his usual or last known business or residence address or to give notice to such person in person or by telephone at least twenty-four (24) hours before the meeting. Notice shall be given by the secretary, or in his absence or unavailability, may be given by an assistant secretary, if any, or by the officer or directors calling the meeting. The requirement of notice to any director may be waived by a written waiver of notice, executed by such person before or after the meeting or meetings and filed with the records of the meeting, or by attendance at the meeting without protesting prior thereto or at its commencement the lack of notice. A notice or waiver of notice of a directors' meeting need not specify the purposes of the meeting. Section 2.11. Agenda. Any lawful business may be transacted at a meeting of the board of directors, notwithstanding the fact that the nature of the business may not have been specified in the notice or waiver of notice of the meeting. Section 2.12. Quorum. At any meeting of the board of directors, a majority of the directors then in office shall constitute a quorum for the transaction of business. Any meeting may be adjourned by a majority of the votes cast upon the question, whether or not a quorum is present, and the meeting may be held as adjourned without further notice. -5- Section 2.13. Action at Meeting. Any motion adopted by vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors, except where a different vote is required by law, by the Certificate of Incorporation or by these By-laws. The assent in writing of any director to any vote or actions of the directors taken at any meeting, whether or not a quorum was present and whether or not the director had or waived notice of the meeting, shall have the same effect as if the director so assenting was present at such meeting and voted in favor of such vote or action. Section 2.14. Action Without Meeting. Any action by the directors may be taken without a meeting if all of the directors consent to the action in writing and the consents are filed with the records of the directors' meetings. Such consent shall be treated for all purposes as a vote of the directors at a meeting. Section 2.15. Committees. The board of directors may, by the affirmative vote of a majority of the directors then in office, appoint an executive committee or other committees consisting of one or more directors and may by vote delegate to any such committee some or all of their powers except those which by law, the Certificate of Incorporation or these By-laws they may not delegate. In the absence or disqualification of a member of a committee, the members of the committee present and not disqualified, whether or not they constitute a quorum, may by unanimous vote appoint another member of the board of directors to act at the meeting in place of the absence or disqualified member. Unless the board of directors shall otherwise provide, any such committee may make rules for the conduct of its business, but unless otherwise provided by the board of directors or such rules, its meetings shall be called, notice given or waived, its business conducted or its action taken as nearly as may be in the same manner as is provided in these By-laws with respect to meetings or for the conduct of business or the taking of actions by the board of directors. The board of directors shall have power at any time to fill vacancies in, change the membership of, or discharge any such committee at any time. The board of directors shall have power to rescind any action of any committee, but no such rescission shall have retroactive effect. ARTICLE III. Officers Section 3.1. Enumeration. The officers shall consist of a president, a treasurer, a secretary and such other officers and agents (including one or more vice-presidents, assistant treasurers and assistant secretaries), as the board of directors may, in their discretion, determine. Section 3.2. Election. The president, treasurer and secretary shall be elected annually by the director at their first meeting following the annual meeting of the stockholders or any special meeting held in lieu of the annual meeting. Other officers may be chosen by the directors at such meeting or at any other meeting. Section 3.3. Qualifications. An officer may, but need not, be a director or stockholder. Any two or more offices may be held by the same person. Any officer may be required by the -6- directors to give bond for the faithful performance of his duties to the corporation in such amount and with such sureties as the directors may determine. The premiums for such bonds may be paid by the corporation. Section 3.4. Tenure. Except as otherwise provided by the Certificate of Incorporation or these By-laws, the term of office of each officer shall be for one year or until his successor is elected and qualified or until his earlier resignation or removal. Section 3.5. Removal. Any officer may be removed from office, with or without cause, by the affirmative vote of a majority of the directors then in office; provided, however, that an officer may be removed for cause only after reasonable notice and opportunity to be heard by the board of directors prior to action thereon. Section 3.6. Resignation. Any officer may resign by delivering or mailing postage prepaid a written resignation to the corporation at its principal office or to the president secretary, or assistant secretary, if any, and such resignation shall be effective upon receipt unless it is specified to be effective at some other time or upon the happening of some event. Section 3.7. Vacancies. A vacancy in any office arising from any cause may be filled for the unexpired portion of the term by the board of directors. Section 3.8. President. The president shall be the chief executive officer of the corporation Except as otherwise voted by the board of directors, the president shall preside at all meetings of the stockholders and of the board of directors at which present. The president shall have such duties and powers as are commonly incident to the office and such duties and powers as the board of directors shall from time to time designate. Section 3.9. Vice-President(s). The vice-president(s), if any, shall have such powers and perform such duties as the board of directors may from time to time determine. Section 3.10. Treasurer and Assistant Treasurers. The treasurer, subject to the direction and under the supervision and control of the board of directors, shall have general charge of the financial affairs of the corporation. The treasurer shall have custody of all funds, securities and valuable papers of the corporation, except as the board of directors may otherwise provide. The treasurer shall keep or cause to be kept full and accurate records of account which shall be the property of the corporation, and which shall be always open to the inspection of each elected officer and director of the corporation. The treasurer shall deposit or cause to be deposited all funds of the corporation in such depository or depositories as may be authorized by the board of directors. The treasurer shall have the power to endorse for deposit or collection all notes, checks, drafts, and other negotiable instruments payable to the corporation. The treasurer shall perform such other duties as are incidental to the office, and such other duties as may be assigned by the board of directors. Assistant treasurers, if any, shall have such powers and perform such duties as the board of directors may from time to time determine. -7- Section 3.11. Secretary and Assistant Secretaries. The secretary shall record, or cause to be recorded, all proceedings of the meetings of the stockholders and directors (including committees thereof) in the book of records of this corporation. The record books shall be open at reasonable times to the inspection of any stockholder, director, or officer. The secretary shall notify the stockholders and directors, when required by law or by these By-laws, of their respective meetings, and shall perform such other duties as the directors and stockholders may from time to time prescribe. The secretary shall have the custody and charge of the corporate seal, and shall affix the seal of the corporation to all instruments requiring such seal, and shall certify under the corporate seal the proceedings of the directors and of the stockholders, when required. In the absence of the secretary at any such meeting, a temporary secretary shall be chosen who shall record the proceedings of the meeting in the aforesaid books. Assistant secretaries, if any, shall have such powers and perform such duties as the board of directors may from time to time designate. Section 3.12. Other Powers and Duties. Subject to these By-laws and to such limitations as the board of directors may from time to time prescribe, the officers of the corporation shall each have such powers end duties as generally pertain to their respective offices, as well as such powers and duties as from time to time may be conferred by the board of directors. ARTICLE IV. Capital Stock Section 4.1. Stock Certificates. Each stockholder shall be entitled to a certificate representing the number of shares of the capital stock of the corporation owned by such person in such form as shall, in conformity to law, be prescribed from time to time by the board of directors. Each certificate shall be signed by the president or vice-president and treasurer or assistant treasurer or such other officers designated by the board of directors from time to time as permitted by law, shall bear the seal of the corporation, and shall express on its face its number, date of issue, class, the number of shares for which, and the name of the person to whom, it is issued. The corporate seal and any or all of the signatures of corporation officers may be facsimile if the stock, certificate is manually counter-signed by an authorized person on behalf of a transfer agent or registrar other than the corporation or its employee. If an officer, transfer agent or registrar who has signed, or whose facsimile signature has been placed on, a certificate shall have ceased to be such before the certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent or registrar at the time of its issue. Section 4.2. Transfer of Shares. Title to a certificate of stock and to the shares represented thereby shall be transferred only on the books of the corporation by delivery to the corporation or its transfer agent of the certificate properly endorsed, or by delivery of the certificate accompanied by a written assignment of the same, or a properly executed written power of at- -8- torney to sell, assign or transfer the same or the shares represented thereby. Upon surrender of a certificate for the shares being transferred, a new certificate or certificates shall be issued according to the interests of the parties. Section 4.3. Record Holders. Except as otherwise may be required by law, by the Certificate of Incorporation or by these By-laws, the corporation shall be entitled to treat the record hold of stock as shown on its books as the owner of such stock for all purposes, including the payment of dividends and the right to vote with respect thereto, regardless of any transfer, pledge or other disposition of such stock, until the shares have been transferred on the books of the corporation in accordance with the requirements of these By-laws. It shall be the duty of each stockholder to notify the corporation of his post office address. Section 4.4. Record Date. In order that the corporation may determine the stockholders entitled to receive notice of or to vote at any meeting of stockholders or any adjournments thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the board of directors may fix, in advance, a record date, which shall not be more than sixty days prior to any other action. In such case only stockholders of record on such record date shall be so entitled notwithstanding any transfer of stock on the books of the corporation after the record date. If no record date is fixed: (i) the record date for determining stockholders entitled to receive notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; (ii) the record date for determining stockholders entitled to express consent to corporate action in writing without a meeting, when no prior action by the board of directors is necessary, shall be the day on which the first written consent is expressed; and (iii) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the board of directors adopts the resolution relating thereto. Section 4.5. Transfer Agent and Registrar for Shares of Corporation. The board of directors may appoint a transfer agent and a registrar of the certificates of stock of the corporation. Any transfer agent so appointed shall maintain, among other records, a stockholders' ledger, setting forth the names and addresses of the holders of all issued shares of stock of the corporation, the number of shares held by each, the certificate numbers representing such shares, and the date of issue of the certificates representing such shares. Any registrar so appointed shall maintain, among other records, a share register, setting forth the total number of shares of each class of shares which the corporation is authorized to issue and the total number of shares actually issued. The stockholders' ledger and the share register are hereby identified as the stock transfer books of the corporation; but as between the stockholders' ledger and the share register, the names and addresses of stockholders, as they appear on the stockholders' ledger maintained by the transfer agent shall be the official list of stockholders of record of the corporation. The -9- name and address of each stockholder of record, as they appear upon the stockholders' ledger, shall be conclusive evidence of who are the stockholders entitled to receive notice of the meetings of stockholders, to vote at such meetings, to examine a complete list of the stockholders entitled to vote at meetings, and to own, enjoy and exercise any other property or rights deriving from such shares against the corporation. Stockholders, but not the corporation, its directors, officers, agents or attorneys, shall be responsible for notifying the transfer agent, in writing, of any changes in their names or addresses from time to time, and failure to do so will relieve the corporation, its other stockholders, directors, officers, agents and attorneys, and its transfer agent and registrar, of liability for failure to direct notices or other documents, or pay over or transfer dividends or other property or rights, to a name or address other than the name and address appearing in the stockholders' ledger maintained by the transfer agent. Section 4.6. Loss of Certificates. In case of the loss, destruction or mutilation of a certificate of stock, a replacement certificate may be issued in place thereof upon such terms as the board of directors may prescribe, including, in the discretion of the board of directors, a requirement of bond and indemnity to the corporation. Section 4.7. Restriction on Transfer. Every certificate for shares of stock which are subject to any restriction on transfer, whether pursuant to the Certificate of Incorporation, the By-laws or any agreement to which the corporation is a party, shall have the fact of the restriction noted conspicuously on the certificate and shall also set forth on the face or back either the full text of the restriction or a statement that the corporation will furnish a copy to the holder of such certificate upon written request and without charge. Section 4.8. Multiple Classes of Stock. The amount and classes of the capital stock and the par value, if any, of the shares, shall be as fixed in the Certificate of Incorporation. At all times when there are two or more classes of stock, the several classes of stock shall conform to the description and the terms and have the respective preferences, voting powers, restrictions and qualifications set forth in the Certificate of Incorporation and these By-laws. Every certificate issued when the corporation is authorized to issue more than one class or series of stock shall set forth on its face or back either (i) the full text of the preferences, voting powers, qualifications and special and relative rights of the shares of each class and series authorized to be issued, or (ii) a statement of the existence of such preferences, powers, qualifications and rights, and a statement that the corporation will furnish a copy thereof to the holder of such certificate upon written request and without charge. ARTICLE V. Dividends Section 5.1. Declaration of Dividends. Except as otherwise required by law or by the Certificate of Incorporation, the board of directors may, in its discretion, declare what, if any, dividends shall be paid from the surplus or from the net profits of the corporation for the current or preceding fiscal year, or as otherwise permitted by law. Dividends may be paid in cash, in -10- property, in shares of the corporation's stock, or in any combination thereof. Dividends shall be payable upon such dates as the board of directors may designate. Section 5.2. Reserves. Before the payment of any dividend and before making any distribution of profits, the board of directors, from time to time and in its absolute discretion, shall have power to set aside out of the surplus or net profits of the corporation such sum or sums as the board of directors deems proper and sufficient as a reserve fund to meet contingencies or for such other purpose as the board of directors shall deem to be in the best interests of the corporation, and the board of directors may modify or abolish any such reserve. ARTICLE VI Powers of Officers to Contract With the Corporation Any and all of the directors and officers of the corporation, notwithstanding their official relations to it, may enter into and perform any contract or agreement of any nature between the corporation and themselves, or any and all of the individuals from time to time constituting the board of directors of the corporation, or any firm or corporation in which any such director may be interested, directly or indirectly, whether such individual, firm or corporation thus contracting with the corporation shall thereby derive personal or corporate profits or benefits or otherwise; provided, that (i) the material acts of such interest are disclosed or are known to the board of directors or committee thereof which authorizes such contract or agreement; (ii) if the material facts as to such person's relationship or interest are disclosed or are known to the stockholders entitled to vote thereon, and the contract is specifically approved in good faith by a vote of the stockholders; or (iii) the contract or agreement is fair as to the corporation as of the time it is authorized, approved or ratified by the board of directors, a committee thereof, or the stockholders. Any director of the corporation who is interested in any transaction as aforesaid may nevertheless be counted in determining the existence of a quorum at any meeting of the board of directors which shall authorize or ratify any such transaction. This Article shall not be construed to invalidate any contract or other transaction which would otherwise be valid under the common or statutory law applicable thereto. ARTICLE VII Indemnification Section 7.1. Definitions. For purposes of this Article VII the following terms shall have the meanings indicated: "Corporate Status" describes the status of a person who is or was a director, Officer, employee, agent, trustee or fiduciary of the corporation or of any other corporation, partnership, -11- joint venture, trust, employee benefit plan or other enterprise which such person is or was serving at the express written request of the corporation. "Court" means the Court of Chancery of the State of Delaware, the court in which the Proceeding in respect of which indemnification is sought by a Covered Person shall have been brought or is pending, or another court having subject matter jurisdiction and personal jurisdiction over the parties. "Covered Person" means a person who is a present or former director or Officer of the corporation and shall include such person's legal representatives, heirs, executors and administrators. "Disinterested" describes any individual, whether or not that individual is a director, Officer, employee or agent of the corporation, who is not and was not and is not threatened to be made a party to the Proceeding in respect of which indemnification, advancement of Expenses or other action is sought by a Covered Person. "Expenses" shall include, without limitation, all reasonable attorneys' fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating or being or preparing to be a witness in a Proceeding. "Good Faith" shall mean a Covered Person having acted in good faith and in a manner such Covered Person reasonably believed to be in or not opposed to the best interests of the corporation or, in the case of an employee benefit plan, the best interests of the participants or beneficiaries of said plan, as the case may be, and, with respect to any Proceeding which is criminal in nature, having had no reasonable cause to believe such Covered Person's conduct was unlawful. "Improper Personal Benefit" shall include, but not be limited to, the personal gain in fact by reason of a person's Corporate Status of a financial profit, monies or other advantage not also accruing to the benefit of the corporation or to the stockholders generally and which is unrelated to his usual compensation including, but not limited to, (i) in exchange for the exercise of influence over the corporation's affairs, (ii) as a result of the diversion of corporate opportunity, or (iii) pursuant to the use or communication of confidential or inside information for the purpose of generating a profit from trading in the corporation's securities. Notwithstanding the foregoing, "Improper Personal Benefit" shall not include any benefit, directly or indirectly, related to actions taken in order to evaluate, discourage, resist prevent or negotiate any transaction with or proposal from any person or entity seeking control of, or a controlling interest in, the corporation. "Independent Counsel" means a law firm, or a member of a law firm, that is experienced in matters of corporation law and may include law firms or members thereof that are regularly -12- retained by the corporation but not by any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Counsel" shall not include any person who, under the standards of professional conduct then prevailing and applicable to such counsel, would have a conflict of interest in representing either the corporation or Covered Person in an action to determine the Covered Person's rights under this Article. "Officer" means the president, vice presidents, treasurer, assistant treasurers), secretary, assistant secretary and such other executive officers as are appointed by the board of directors of the corporation and explicitly entitled to indemnification hereunder. "Proceeding" includes any actual, threatened or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation (including any internal corporate investigation), administrative hearing or any other proceeding, whether civil, criminal, administrative or investigative, other than one initiated by the Covered Person, but including one initiated by a Covered Person for the purpose of enforcing such Covered Person's rights under this Article to the extent provided in Section 7.14 of this Article. "Proceeding" shall not include any counterclaim brought by any Covered Person other than one arising out of the same transaction or occurrence that is the subject matter of the underlying claim. Section 7.2. Right to Indemnification in General. (a) Covered Persons. The corporation may indemnify, and may advance Expenses, to each Covered Person who is, was or is threatened to be made a party or otherwise involved in any Proceeding, as provided in this Article and to the fullest extent permitted by applicable law in effect on the date hereof and to such greater extent as applicable law may hereafter from time to time permit. The indemnification provisions in this Article shall be deemed to be a contract between the corporation and each Covered Person who serves in any Corporate Status at any time while these provisions as well as the relevant provisions of the Delaware General Corporation Law are in effect, and any repeal or modification thereof shall not affect any right or obligation then existing with respect to any state of facts then or previously existing or any Proceeding previously or thereafter brought or threatened based in whole or in part upon any such state of facts. Such a contract right may not be modified retroactively without the consent of such Covered Person. (b) Employees and Agents. The corporation may, to the extent authorized from time to time by the board of directors, grant indemnification and the advancement of Expenses to any employee or agent of the corporation to the fullest extent of the provisions of this Article with respect to the indemnification and advancement of Expenses of Covered Persons. Section 7.3 Proceedings Other Than Proceedings by or in the Right of the Corporation. Each Covered Person may be entitled to the rights of indemnification provided in this Section 7.3 if, by reason of such Covered Person's Corporate Status, such Covered Person is, was or is -13- threatened to be made, a party to or is otherwise involved in any Proceeding, other than a Proceeding by or in the right of the corporation. Each Covered Person may be indemnified against Expenses, judgments, penalties, fines and amounts paid in settlements, actually and reasonably incurred by such Covered Person or on such Covered Person's behalf in connection with such Proceeding or any claim, issue or matter therein, If such Covered Person acted in Good Faith and such Covered Person has not been adjudged during the course of such proceeding to have derived an Improper Personal Benefit from the transaction or occurrence forming the basis of such Proceeding. Section 7.4. Proceedings by or in the Right of the Corporation. Each Covered Person may be entitled to the rights of indemnification provided in this Section 7.4 if, by reason of such Covered Person's Corporate Status, such Covered Person is, or is threatened to be made, a party to or is otherwise involved in any Proceeding brought by or in the right of the corporation to procure a judgment in its favor. Such Covered Person may be indemnified against Expenses, judgments, penalties, and amounts paid in settlement, actually and reasonably incurred by such Covered Person or on such Covered Person's behalf in connection with such Proceeding if such Covered Person acted in Good Faith and such Covered Person has not been adjudged during the course of such proceeding to have derived an Improper Personal Benefit from the transaction or occurrence forming the basis of such Proceeding. Notwithstanding the foregoing, no such indemnification shall be made in respect of any claim, issue or matter in such Proceeding as to which such Covered Person shall have been adjudged to be liable to the corporation if applicable law prohibits such indemnification; provided, however, that, if applicable law so permits, indemnification shall nevertheless be made by the corporation in such event if and only to the extent that the Court which is considering the matter shall so determine. Section 7.5. Indemnification of a Party Who is Wholly or Partly Successful. Notwithstanding any provision of this Article to the contrary, to the extent that a Covered Person is, by reason of such Covered Person's Corporate Status, a party to or is otherwise involved in and is successful, on the merits or otherwise, in any Proceeding, such Covered Person shall be indemnified to the maximum extent permitted by law, against all Expenses, judgments, penalties, fines, and amounts paid in settlement, actually and reasonably incurred by such Covered Person or on such Covered Person's behalf in connection therewith. If such Covered Person is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the corporation shall indemnify such Covered Person to the maximum extent permitted by law, against all Expenses, judgments, penalties, fines, and amounts paid in settlement, actually and reasonably incurred by such Covered Person or on such Covered Person's behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section 7.5 and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter. Section 7.6. Indemnification for Expenses of a Witness. Notwithstanding any provision of this Article to the contrary, to the extent that a Covered Person is, by reason of such Covered Person's Corporate Status, a witness in any Proceeding, such Covered Person shall be indemni- -14- fied against all Expenses actually and reasonably incurred by such Covered Person or on such Covered Person's behalf in connection therewith. Section 7.7. Advancement of Expenses. Notwithstanding any provision of this Article to the contrary, the corporation may advance all reasonable Expenses which, by reason of a Covered Person's Corporate Status, were incurred by or on behalf of such Covered Person in connection with any Proceeding, within thirty (30) days after the receipt by the corporation of a statement or statements from such Covered Person requesting such advance or advances, whether prior to or after final disposition of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by the Covered Person and shall include or be preceded or accompanied by an undertaking by or on behalf of the Covered Person to repay any Expenses if such Covered Person shall be adjudged to be not entitled to be indemnified against such Expenses. Any advance and undertaking to repay pursuant to this Section 7.7 may be unsecured interest-free, as the corporation sees fit. Advancement of Expenses pursuant to this Section 7.7 shall not require approval of the board of directors or the stockholders of the corporation, or of any other person or body. The secretary of the corporation shall promptly advise the Board in writing of the request for advancement of Expenses, of the amount and other details of the request and of the undertaking to make repayment provided pursuant to this Section 7.7. Section 7.8. Notification and Defense of Claim. Promptly after receipt by a Covered Person of notice of the commencement of any Proceeding, such Covered Person shall, if a claim is to be made against the corporation under this Article, notify the corporation of the commencement of the Proceeding. The failure to notify the corporation will not relieve the corporation from any liability which it may have to such Covered Person otherwise than under this Article. With respect to any such Proceedings to which such Covered Person notifies the corporation: (a) The corporation will be entitled to participate in the defense at its own expense. (b) Except as otherwise provided below in this subparagraph (b), the corporation (jointly with any other indemnifying party similarly notified) will be entitled to assume the defense with counsel reasonably satisfactory to the Covered Person. After notice from the corporation to the Covered Person of its election to assume the defense of a suit, the corporation will not be liable to the Covered Person under this Article for any legal or other expenses subsequently incurred by the Covered Person in connection with the defense of the Proceeding other than reasonable costs of investigation or as otherwise provided below in this subparagraph (b). The Covered Person shall have the right to employ his own counsel in such Proceeding but the fees and expenses of such counsel incurred after notice from the corporation of its assumption of the defense shall be at the expense of the Covered Person except as provided in this paragraph. The fees and expenses of counsel shall be at the expense of the corporation if (i) the employment of counsel by the Covered Person has been authorized by the corporation, (ii) the Covered Person shall have concluded reasonably that there may be a conflict of interest between the corporation and the Covered Person in the conduct of the defense of such action and such conclusion is confirmed in writing by the corporation's outside counsel regularly employed -15- by it in connection with corporate matters, or (iii) the corporation shall not in Fact have employed counsel to assume the defense of such Proceeding. The corporation shall be entitled to participate in, but shall not be entitled to assume the defense of any Proceeding brought by or in the right of the corporation or as to which the Covered Person shall have made the conclusion provided for in (ii) above and such conclusion shall have been so confirmed by the corporation's said outside counsel. (c) Notwithstanding any provision of this Article to the contrary, the corporation shall not be obligated to indemnify the Covered Person under this Article for any amounts paid in settlement of any Proceeding effected without its written consent. The corporation shall not settle any Proceeding or claim in any manner which would impose any penalty, limitation or disqualification of the Covered Person for any purpose without such Covered Person's written consent. Neither the corporation nor the Covered Person will unreasonably withhold their consent to any proposed settlement. (d) If it is determined that the Covered Person is entitled to indemnification other than as afforded under subparagraph (b) above, payment to the Covered Person of the additional amounts for which he is to be indemnified shall be made within ten (10) days after such determination. Section 7.9. Procedures. (a) Method of Determination. A determination (as provided for by this Article or if required by applicable law in the specific case) with respect to a Covered Person's entitlement to indemnification shall be made either (a) by the board of directors by a majority vote of a quorum consisting of Disinterested directors, or (b) in the event that a quorum of the board of directors consisting of Disinterested directors is not obtainable or, even if obtainable, such quorum of Disinterested directors so directs, by Independent Counsel in a written determination to the board of directors, a copy of which shall be delivered to the Covered Person seeking indemnification, or (c) by the vote of the holders of a majority of the corporation's capital stock outstanding at the time entitled to vote thereon. (b) Initiating Request. A Covered Person who seeks indemnification under this Article shall submit a Request for Indemnification, including such documentation and information as is reasonably available to such Covered Person and is reasonably necessary to determine whether and to what extent such Covered Person is entitled to indemnification. (c) Presumptions. In making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall not presume that the Covered Person is or is not entitled to indemnification under this Article. (d) Burden of Proof. Each Covered Person shall bear the burden of going forward and demonstrating sufficient facts to support his claim for entitlement to indemnification under this Article. That burden shall be deemed satisfied by the submission of an initial Request for Indemnification pursuant to Section 7.9(b) above. -16- (e) Effect of Other Proceedings. The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of guilty or of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Article) of itself adversely affect the right of a Covered Person to indemnification or create a presumption that a Covered Person did not act in Good Faith. (f) Action of Others. The knowledge, actions, or failure to act, of any director, officer, employee, agent, trustee or fiduciary of the enterprise whose daily activities the Covered Person was actually responsible for may be imputed to a Covered Person for purposes of determining the right to indemnification under this Article. Section 7.10. Action by the Corporation. Any action, payment, advance determination other than a determination made pursuant to Section 7.9(a) above, authorization, requirement, grant of indemnification or other action taken by the corporation pursuant to this Article shall be effected exclusively through any Disinterested person so authorized by the board of directors of the corporation, including the president or any vice president of the corporation. Section 7.11. Non-Exclusivity. The rights of indemnification and to receive advancement of Expenses as provided by this Article shall not be deemed exclusive of any other rights to which a Covered Person may at any time be entitled under applicable law, the Certificate of Incorporation, these By-Laws, any agreement, a vote of stockholders or a resolution of the board of directors, or otherwise. No amendment, alteration, rescission or replacement of this Article or any provision hereof shall be effective as to an Covered Person with respect to any action taken or omitted by such Covered Person in such Covered Person's Corporate Status or with respect to any state of facts then or previously existing or any Proceeding previously or thereafter brought or threatened based in whole or to the extent based in part upon any such state of facts existing prior to such amendment, alteration, rescission or replacement. Section 7.12. Insurance. The corporation may maintain, at its expense, an insurance policy or policies to protect itself and any Covered Person, officer, employee or agent of the corporation or another enterprise against liability arising out of this Article or otherwise, whether or not the corporation would have the power to indemnify any such person against such liability under the Delaware General Corporation Law. Section 7.13. No Duplicative Payment. The corporation shall not be liable under this Article to make any payment of amounts otherwise indemnifiable hereunder if and to the extent that a Covered Person has otherwise actually received such payment under any insurance policy, contract agreement or otherwise. Section 7.14. Expenses of Adjudication. In the event that any Covered Person seeks a judicial adjudication, or an award in arbitration, to enforce such Covered Person's rights under, or to recover damages for breach of, this Article, the Covered Person shall be entitled to recover from the corporation, and shall be indemnified by the corporation against, any and all expenses (of the types described in the definition of Expenses in Section 7.1 of this Article) actually and -17- reasonably incurred by such Covered Person in seeking such adjudication or arbitration, but only if such Covered Person prevails therein. If it shall be determined in such adjudication or arbitration that the Covered Person is entitled to receive part but not all of the indemnification of expenses sought, the expenses incurred by such Covered Person in connection with such adjudication or arbitration shall be appropriately prorated. Section 7.15. Severability. If any provision or provisions of this Article shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Article (including without limitation, each portion of any Section of this Article containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Article (including, without limitation, each portion of any Section of this Article containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable. ARTICLE VIII Section 8.1. Restriction on Transfer. For purposes of this Article VIII, the term "Stock" shall mean the common stock, $.01 par value, of the corporation. Except to the extent and in the manner provided herein or as provided by agreement among all the stockholders of the corporation and the corporation, a stockholder of the corporation may not sell, assign, transfer, pledge, hypothecate, or otherwise dispose (including by gift or otherwise) of any of his shares of Stock. Section 8.2 Exception for Authorized Transferees. The restrictions of Sections 8.3 and 8.4 of this Article VII shall not apply to transfers of Stock to the following persons (hereinafter "Authorized Transferees"): (a) the stockholder as the sole trustee of a trust revocable by the stockholder alone; (b) a corporation, of which the stockholder transferring Stock owns, directly or indirectly, not less than a majority of the capital stock which is entitled to vote for the election of directors; or (c) the stockholder's spouse or issue; provided, that the Stock held by such Authorized Transferee shall remain subject to the provisions of this Article VIII. Section 8.3 Voluntary Transfers. Neither a Stockholder nor his Authorized Transferee may sell, assign, pledge or otherwise dispose of any shares of Stock, or any interest therein now -18- held or hereafter acquired, without first giving written notice thereof to the corporation. The written notice shall include the name of the transferee and all material terms of such transfer and, in the case of a transfer for fair value, shall be accompanied by a copy of the bona fide written offer to purchase such Stock upon the terms set forth in the written notice. The written notice to the corporation shall be deemed for all purposes to give the corporation a first right of purchase (sometimes referred to as a right of first refusal) as provided herein. If the corporation declines or fails to exercise its first right of purchase within the time provided, the stockholder may, within 60 days from the date said right terminates, transfer the Stock to the proposed transferee upon substantially the terms set forth in the original notice to the corporation. Section 8.4 Transfer Events. (a) The corporation shall have a first right of purchase for all shares of Stock held by a stockholder as provided in Section 8.5, immediately upon the happening of any of the following events (each a "Transfer Event"): (i) the death of a stockholder; (ii) a stockholder or Authorized Transferee voluntarily files a petition under any bankruptcy or insolvency law or a petition for the appointment of a receiver, or makes an assignment for the benefit of creditors; (iii) a stockholder or Authorized Transferee is subjected involuntarily to such a petition or assignment, or any creditor or other person obtains an attachment or other legal or equitable interest in any Stock of a stockholder, and such involuntary petition, assignment or attachment is not discharged within 30 days after creation; or (iv) a stockholder or Authorized Transferee is subject to a judgment, court order or decree or by operation of law is otherwise required to transfer Stock to other than an Authorized Transferee. (b) In the event of death of a stockholder, his executor or administrator shall, within 90 days after death, give written notice thereof to the corporation and shall give the corporation a first right of purchase as provided herein. A stockholder shall, within 10 days of the occurrence of a Transfer Event specified in clauses (ii) through (iv) of subparagraph (a), give written notice thereof to the corporation. If the corporation declines or fails to exercise timely its first right of purchase as provided in Section 8.5, then the legal representative, beneficiary, trustee, assignee, receiver or other transferee who obtained the Stock by reason of the Transfer Event may retain the Stock, subject to the provisions of this Article VIII. Section 8.5. First Right of Purchase. Upon receipt of written notice of intent to make a voluntary transfer under Section 8.3 or upon the occurrence of a Transfer Event specified in Section 8.4, the corporation shall have a right to purchase any or all of the shares of Stock to which -19- such notice or Transfer Event relates at the price specified herein before any other action is taken to sell, assign, transfer, pledge, or otherwise dispose of the Stock. Such right shall continue for a period of 30 days from the receipt of written notice under Section 8.3 or the receipt of written notice of a Transfer Event, and in any event, shall continue for 15 days from the date of the receipt by the corporation of an appraisal made pursuant to Section 8.7(a). If the corporation elects to exercise such first right of purchase, it shall so notify the holder of such shares of Stock, specifying the manner of payment and time and place for tender of certificates representing all such shares of Stock. Section 8.6. Transfers in Violation of Article. If any transfer of shares of Stock is made or attempted contrary to the provisions of this Article VIII, or if shares of Stock are not offered to the corporation as required herein, the corporation shall have the right to purchase said shares from the owner thereof or his transferee at any time before or after the transfer, as herein provided. In the event that the corporation elects to exercise its first right of purchase, it may do so by cancelling the certificate(s) representing the Stock and depositing the purchase price, as determined pursuant to Section 8.7 hereof, in a bank account for the benefit of a stockholder. In addition to any other legal or equitable remedies which it may have, the corporation may enforce its rights by actions for specific performance (to the extent permitted by law) and may refuse to recognize any transferee as one of its stockholders for any purpose, including without limitation dividend and voting rights, until there has been compliance with all applicable provisions of this Article VIII. Section 8.7. Purchase Price. (a) Except as provided in subparagraph (b) of this Section, the purchase price per share of Stock which the corporation elects to purchase hereunder shall be the fair market value per share, as determined by appraisal, as of the last day of the fiscal quarter immediately preceding the receipt of the written notice under Section 8.3, or the occurrence of a Transfer Event, multiplied by the number of shares of Stock to be purchased pursuant to such notice. Not later than 10 days after the date of receipt by the corporation of notice of its right to purchase, the corporation and the stockholder or Authorized Transferee shall select an appraiser or, failing the selection of a mutually acceptable appraiser within such period, within an additional 10 day period, the corporation shall appoint an appraiser, the stockholder or Authorized Transferee whose shares are being purchased shall appoint a second appraiser, and such two appraisers shall appoint a third appraiser, or failing action within such period by any party or the appraisers, any unappointed appraiser or appraisers shall be appointed by the American Arbitration Association, Boston, Massachusetts, upon application of any party or appraiser. Within 20 days from his (their) appointment, the appraiser(s) shall proceed by majority vote, if necessary, to determine the value of the Stock, and such determination shall be final and binding upon all interested persons. The corporation shall promptly furnish to the appraiser(s) such information concerning its financial condition, earnings, capitalization, business prospects and sales of its capital stock as he (they) may reasonably request. Within such 20 day period, the appraiser(s) shall, in writing, promptly notify the corporation, the stockholder whose shares of Stock are being purchased, and any other interested person known to the appraiser(s), of the final determination of value. The parties shall each pay the fees and expenses of any appraiser appointed by or for each of them, and shall pay -20- equally the fees and expenses of a single mutually acceptable appraiser or the third appraiser, if selection of a third appraiser is necessary. (b) Notwithstanding any contrary provisions hereof, in the event of a proposed sale by any stockholder, or of his Authorized Transferee, to a third party in a bona fide transaction for fair value payable in cash or the equivalent, currently or in future installments, the purchase price of said Stock shall be the value offered by such third party and the corporation shall have the first right of purchase, exercisable within the period specified in Section 8.5, to purchase said Stock at such price upon terms substantially equivalent to those offered by such third party. The board of directors may impose reasonable requirements for ascertaining that such third party offer is a bona fide offer. Such first right of purchase shall not apply to a proposed assignment, transfer, exchange, pledge or any other sale or disposition of Stock which does not constitute a bona fide transfer for fair value (as determined by the board of directors of the corporation), and the provisions of subparagraph (a) of this Section 8.7 shall apply to such other transactions. Section 8.8. Tenders. All shares of Stock which the corporation has elected to purchase hereunder shall be tendered to the corporation, or to one or more substitute purchasers designated by it, at the principal office of the corporation at a reasonable date and time specified by it (in any event within 60 days after the corporation's election to purchase), by delivery of certificates representing such shares, endorsed in blank and in proper form for transfer against payment of the purchase price in cash or by certified or bank check, or upon such terms as are applicable under Section 8.7(b). Section 8.9. Waiver, Disposition of Stock. From time to time, the corporation may waive its rights hereunder either generally or with respect to one or more specific transfers which have been proposed, attempted or made. All action to be taken by the corporation hereunder shall be taken by vote of a majority of its board of directors. Any Stock which the corporation has elected to purchase hereunder may be disposed of by the board of directors in such manner as it deems appropriate. Section 8.10. Notices. All notices and elections under this Article VIII shall be in writing and shall be delivered or sent by registered or certified mail, postage prepaid, to the corporation at its principal place of business and to any stockholder at the address then listed in the stock transfer records of the corporation. -21- ARTICLE VIX. Miscellaneous Provisions Section 9.1. Certificate of Incorporation. All references in these By-laws to the Certificate of Incorporation shall be deemed to refer to the Certificate of Incorporation of the corporation, as amended and in effect from time to time. Section 9.2. Fiscal Year. Except as from time to time otherwise provided by the board of directors, the fiscal year of the corporation shall end on the October 31st of each year. Section 9.3. Corporate Seal. The board of directors shall have the power to adopt and alter the seal of the corporation. Section 9.4. Execution of Instruments. All deeds, leases, transfers, contracts, bonds, notes, and other obligations authorized to be executed by an officer of the corporation on its behalf shall be signed by the president or the treasurer except as the board of directors may generally or in particular cases otherwise determine. Section 9.5. Voting of Securities. Unless the board of directors otherwise provides, the president or the treasurer may waive notice of and act on behalf of this corporation, or appoint another person or persons to act as proxy or attorney in fact for this corporation with or without discretionary power and/or power of substitution, at any meeting of stockholders or shareholders of any other corporation or organization, any of whose securities are held by this corporation. Section 9.6. Evidence of Authority. A certificate by the secretary or any assistant secretary as to any action taken by the stockholders, directors or any officer or representative of the corporation shall, as to all persons who rely thereon in good faith, be conclusive evidence of such action. The exercise of any power which by law, by the Certificate of Incorporation, or by these By-laws, or under any vote of the stockholders or the board of directors, may be exercised by an officer of the corporation only in the event of absence of another officer or any other contingency shall bind the corporation in favor of anyone relying thereon in good faith, whether or not such absence or contingency existed. Section 9.7. Corporate Records. The original, or attested copies, of the Certificate of Incorporation, By-laws, records of all meetings of the incorporators and stockholders, and the stock transfer books (which shall contain the names of all stockholders and the record address and the amount of stock held by each) shall be kept in Delaware at the principal office of the corporation, or at an office of the corporation, or at an office of its transfer agent or of the secretary or of the assistant secretary, if any. Said copies and records need not all be kept in the same office. They shall be available at all reasonable times to inspection of any stockholder for any purpose but not to secure a list of stockholders for the purpose of selling said list or copies thereof or for using the same for a purpose other than in the interest of the applicant, as a stockholder, relative to the affairs of the corporation. -22- Section 9.8. Charitable Contributions. The board of directors from time to time may authorize contributions to be made by the corporation in such amounts as it may determine to be reasonable to corporations, trusts, funds or foundations organized and operated exclusively for charitable, scientific or educational purposes, no part of the net earning of which inures to the private benefit of any stockholder or individual. ARTICLE X. Amendments Section 10.1. Amendment by Stockholders. Prior to the issuance of stock, these By-laws may be amended, altered or repealed by the incorporator, After stock has been issued, these By-laws may be amended altered or repealed by the stockholders at any annual or special meeting by vote or a majority of all shares outstanding and entitled to vote, except that where the effect of the amendment would be to reduce any voting requirement otherwise required by law, the Certificate of Incorporation or these By-laws, such amendment shall require the vote that would have been required by such other provision. Notice and a copy of any proposal to amend these By-laws must be included in the notice of meeting of stockholders at which action is taken upon such amendment. Section 10.2. Amendment by the Board of Directors. These By-laws may be amended or altered by the board of directors at a meeting duly called for the purpose by majority vote of the directors then in office, except that directors shall not amend the By-laws in a manner which: (a) changes the stockholder voting requirements for any action; (b) alters or abolishes any preferential right or right of redemption applicable to a class or series of stock with shares already outstanding; (c) alters the provisions of Articles VII and X hereof; or (d) permits the board of directors to take any action which under law, the Certificate of Incorporation, or these By-laws is required to be taken by the stockholders. Any amendment of these By-laws by me board of directors may be altered or repealed by the stockholders at any annual or special meeting of stockholders. -23- EX-3.15 13 y98028exv3w15.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.15 STATE OF DELAWARE SECRETARY OF STATE 55 FROM CORP LEGAL CMI DIVISION OF CORPORATIONS FILED 02:30 AM 01/15/1991 721015110 - 2252202 CERTIFICATE OF INCORPORATION OF CINCINNATI MILACRON RESIN ABRASIVES INC. ---------------------------------- A corporation organized pursuant to the General Corporation Law of the State of Delaware ------------------------------------------------------ ARTICLE I Name The name of the corporation (hereinafter called the "Corporation") is: CINCINNATI MILACRON RESIN ABRASIVES INC. ARTICLE II Registered Office and Registered Agent The address of the Corporation's registered office in the State of Delaware is 1209 Orange Street, in the City of Wilmington, County of New Castle. The name of the Corporation's registered agent at such address is The Corporation Trust Company. ARTICLE III Business or Purposes To Be Conducted or Promoted The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware. 2 ARTICLE IV Capital Stock The total number of shares of all classes of capital stock which the Corporation shall have authority to issue is 1,000 shares of Common Stock, par value $1,00 per share. ARTICLE V Incorporator The name and mailing address of the incorporator of the Corporation is Walter S. Wood, 4701 Marburg Avenue, Cincinnati, Ohio 45209. ARTICLE VI Business and Affairs of the Corporation SECTION 1. Elections of directors need not be by written ballot unless and except to the extent the By-laws of the Corporation (the "By-laws") shall provide. SECTION 2. Any director or any officer of the Corporation elected or appointed by its stockholders or by its Board of Directors, or any committee thereof, may be removed at any time by a unanimous consent of the stockholders or in such other manner as shall be provided in the By-laws, except as otherwise provided by law. SECTION 3. In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Corporation, in the By-laws, may authorise and empower the Board of Directors to adopt, amend or repeal the By-laws in the manner not inconsistent with the laws of the State of Delaware or this Certificate of Incorporation; the stockholders of the Corporation entitled to vote, however, retain the power to adopt, amend or repeal the By-laws. 3 ARTICLE VIII Indemnification To the fullest extent that the General Corporation Law of the State of Delaware as its exists on the date hereof or as it may hereafter be amended permits the limitation or elimination of the liability of directors, no director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. No amendment to or repeal of this Article shall apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal. I, the undersigned, being the incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the General Corporation Law of Delaware, do make this certificate, hereby declaring and certifying, under penalties of perjury, that this is my act and deed and the facts herein stated are true, and accordingly have hereunto set by hand as of January 15, 1991. /s/ Walter S. Wood -------------------------------- Walter S. Wood Incorporator STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 10:00 AM 09/24/1998 981371000 - 2252202 CERTIFICATE OF AMENDMENT OF CERTIFICATE OF INCORPORATION CINCINNATI MILACRON RESIN ABRASIVES INC., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: FIRST: That the Board of Directors of said corporation, at a meeting duly held, adopted a resolution proposing and declaring advisable the following amendment to the Certificate of Incorporation of said corporation: RESOLVED, that the Certificate of Incorporation of CINCINNATI MILACRON RESIN ABRASIVES INC. be amended by changing the First Article and Heading thereof so that, as amended, said Article and Heading shall be and read as follows: The name of the company is Milacron Resin Abrasives Inc. SECOND: That in lieu of a meeting and vote of shareholders, the stockholders have given written consent to said amendment in accordance with the provisions of Section 228 of the General Corporation Law of the State of Delaware. THIRD: That the aforesaid amendment was duly adopted in accordance with the applicable provisions of Sections 242 and 228 of the General Corporation Law of the State of Delaware. FOURTH: This Certificate of Amendment shall be effective on October 10, 1998. IN WITNESS WHEREOF, said CINCINNATI MILACRON RESIN ABRASIVES INC. has caused this certificate to be signed by Wayne F. Taylor, its Secretary and Assistant Treasurer, this 24 day of September, 1998. CINCINNATI MILACRON RESIN ABRASIVES INC. By: /s/ Ronald L. Smith ------------------------------------ Ronald L. Smith, President EX-3.16 14 y98028exv3w16.txt BYLAWS EXHIBIT 3.16 - -------------------------------------------------------------------------------- CINCINNATI MILACRON RESIN ABRASIVES INC. Incorporated Under the laws of the State of Delaware -------------- BY-LAWS -------------- As adopted on January 16, 1991 - -------------------------------------------------------------------------------- 2 BY-LAWS OF CINCINNATI MILACRON RESIN ABRASIVES INC. ARTICLE I OFFICES SECTION 1. Registered Office. The registered office of CINCINNATI MILACRON RESIN ABRASIVES INC. (the "Corporation") in the State of Delaware shall be at 1209 Orange Street, City of Wilmington, County of New Castle, and the registered agent in charge thereof shall be The Corporation Trust Company. SECTION 2. Other Offices. The Corporation may also have an office or offices at any other place or places within or without the State of Delaware. ARTICLE II Meetings of Stockholders; Stockholders' Consent in Lieu of Meeting SECTION 1. Annual Meetings. The annual meeting of the stockholders for the election of directors, and for the transaction of such other business as may properly come before the meeting, shall be held at such place, date and hour as shall be fixed by the Board of Directors (hereinafter called the "Board") and designated in the notice or waiver of notice thereof, except that no annual meeting need be held if all actions, including the election of directors, required by the Delaware General Corporation Law to be taken at a stockholders' annual meeting are taken by written consent in lieu of meeting pursuant to Section 4 of this Article II. SECTION 2. Special Meetings. Special meetings of the stockholders may be called at any time by the Board or the President of the Corporation to be held at such place, date and hour as shall be designated in the notice. 3 SECTION 3. Notice of Meetings. Unless waived in writing by the stockholder of record or unless such stockholder shall be represented at the meeting in person or by proxy, each stockholder of record shall be given written notice of each meeting of stockholders not less than 10 nor more than 60 days before the date of such meeting, which notice shall state the place, date and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. SECTION 4. Quorum. At each meeting of the stockholders, except as otherwise expressly required by law, stockholders holding a majority of the shares of stock of the Corporation issued, outstanding and entitled to be voted at the meeting shall be present in person or by proxy in order to constitute a quorum for the transaction of business. In the absence of a quorum at any such meeting or any adjournment or adjournments thereof, a majority in voting interest of those present in person or by proxy and entitled to vote thereat or, in the absence therefrom of all the stockholders, any officer entitled to preside at, or to act as secretary of, such meeting may reschedule such meeting from time to tine until stockholders holding the amount of stock requisite for a quorum shall be present in person or by proxy. At any such rescheduled meeting at which a quorum may be present, any business may be transacted that might have been transacted at the meeting as originally called. SECTION 5. Voting. Each holder of voting stock of the Corporation shall, at each meeting of the stockholders, be entitled to one vote in person or by proxy for each share of stock of the Corporation held by him and registered in his name on the books of the Corporation on the date fixed pursuant to the provisions of 4 Section 4 of Article IX of these By-laws as the record date for the determination of stockholders who shall be entitled to receive notice of and to vote at such meeting. Shares of its own stock belonging to the Corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held by the Corporation, shall neither be entitled to vote nor be counted for quorum purposes. Any vote of stock of the Corporation may be given at any meeting of the stockholders by the stockholders entitled to vote thereon either in person or by proxy appointed by an instrument in writing delivered to the Secretary or an Assistant Secretary of the Corporation or the secretary of the meeting. The attendance at any meeting of a stockholder who may theretofore have given a proxy shall not have the effect of revoking the same unless he shall in writing so notify the secretary of the meeting prior to the voting of the proxy. At all meetings of the stockholders, all matters, except as otherwise provided by law or in these By-laws, shall be decided by the vote of a majority of the votes cast by stockholders present in person or by proxy and entitled to vote thereat, a quorum being present. Except as otherwise expressly required by law, the vote at any meeting of the stockholders on any question need not be by ballot, unless so directed by the chairman of the meeting. On a vote by ballot, each ballot shall be signed by the stockholder voting, or by his proxy, if there be such proxy, and shall state the number of shares voted. SECTION 6. Action by Written Consent. Except as otherwise provided by law or by the Certificate of Incorporation, any action required or permitted to be taken at any annual or special meeting of the stockholders may be taken 5 without a meeting, without prior notice and without a vote if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock of the Corporation having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of stock of the Corporation entitled to vote thereon were present and voted. ARTICLE III Board of Directors SECTION 1. General Powers. The business and affairs of the Corporation shall be managed by the Board, which may exercise all such powers of the Corporation and do all such lawful acts and things as are not by law or by the Certificate of Incorporation directed or required to be exercised or done by the stockholders. SECTION 2. Number and Term of Holding Office. The number of directors which shall constitute the whole Board shall be three or such other number as from time to time shall be fixed by resolution of the Board. Each of the directors of the Corporation shall hold office until the annual meeting next after his election and until his successor shall be elected and shall qualify or until his earlier death or resignation or removal in the manner hereinafter provided. SECTION 3. Chairman of the Board and Organization of Business. The Board may elect from among its members a Chairman of the Board who shall be an officer of the Board. The Chairman of the Board shall preside at all meetings 6 of the Board at which he shall be present and shall perform such other duties as may be assigned to him from time to time by the Board. In the absence of the Chairman of the Board, the President, if a director, or, in his absence, a chairman chosen by a majority of the directors present, shall act as chairman. The Secretary of the Corporation or, in his absence, any person (who shall be an Assistant Secretary if an Assistant Secretary shall be present) who the chairman shall appoint, shall act as secretary of such meeting and keep the minutes thereof. SECTION 4. Resignations. Any director nay resign at any time by giving written notice of his resignation to the Board, the President or the Secretary of the Corporation. Any such resignation shall take effect at the time specified therein or, if the time when it is to become effective shall not be specified therein, when accepted by action of the Board. Except as aforesaid, the acceptance of such resignation shall not be necessary to make it effective. SECTION 5. Removal of Directors. A director may be removed, either with or without cause, at any time by vote of a majority of the whole Board or by vote of the holders of a majority of the shares then entitled to vote at an election of directors. SECTION 6. Vacancies. In case of any vacancy on the Board or in case of any newly created directorship, a director to fill the vacancy or the newly created directorship for the unexpired portion of the term being filled may be elected by a majority of the directors of the Corporation then in office, even though the directors then in office may constitute less than a quorum. 7 SECTION 7. Place of Meeting. The Board may hold its meetings at such place or places within or without the State of Delaware as the Board may from time to time by resolution determine or as shall be designated in the notices or waivers of notice thereof. SECTION 8. Meetings. (a) Annual Meetings. As soon as practicable after each annual election of directors, the Board shall meet for the purpose of organization and the transaction of other business. (b) Other Meetings. Other meetings of the Board shall be held at such times and places as the Board shall from time to time determine or upon call by the President or any two or more of the directors. SECTION 9. Notice of Meetings. The Secretary of the Corporation shall give notice to each director of each meeting, including the time and place of such meeting. Notice of each such meeting shall be mailed to each director addressed to him at his residence or usual place of business, at least two days before the day on which such meeting is to be held, or shall be sent to him by telecopy, telegraph or other form of electronic communication or be delivered personally or by telephone not later than the day before the day on which such meeting is to be held. Notice of any meeting shall not be required to be given to any director who shall attend such meeting. A written waiver of notice, signed by the person entitled thereto, whether before or after the time stated therein, shall be equivalent to adequate notice. 8 SECTION 10. Quorum and Manner of Acting. Except as provided in Section 6 of this Article III, one-half of the total number of directors shall be necessary at any meeting of the Board in order to constitute a quorum for the transaction of business at such meeting and the vote of a majority of those directors present at any such meeting at which a quorum shall be present shall be necessary for the passage of any resolution or act of the Board, except as otherwise expressly required by law or these By-laws. In the absence of a quorum for any such meeting, a majority of the directors present thereat may adjourn such meeting from time to time until a quorum shall be present. Notice of any adjourned meeting need not be given. SECTION 11. Unanimous Director Consent in Lieu of Meeting. Any action by the Board or a committee appointed pursuant to Section 1 of Article IV hereof may be taken without a meeting if all members of the Board or such committee consent to such action in writing and the writing or writings are filed with the minutes of the proceedings of the Board or such committee. SECTION 12. Action by Means of Conference Telephone or Similar Communications Equipment. Any one or more members of the Board, or of any committee designated by the Board, may participate in a meeting of the Board or any such committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting by such means shall constitute presence in person at such meeting. 9 SECTION 13. Remuneration. Each director, in consideration of his serving as such, shall be entitled to receive from the Corporation such amount per annum or such fees for attendance at meetings of the Board or of any committee, or both, as the Board shall from time to time determine. The Board may likewise provide that the Corporation shall reimburse each director or member of a committee for any expenses incurred by him on account of his attendance at any such meeting. Nothing contained in this Section shall be construed to preclude any director from serving the Corporation in any other capacity and receiving remuneration therefor. ARTICLE IV COMMITTEES SECTION 1. Committees. The Board may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more directors of the Corporation. The Board may designate one or more directors as alternate members of any committee who may replace an absent or disqualified member at any meeting of such committee. In the absence or disqualification of any member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board constituting such committee, shall have and may exercise all the delegate powers and authority of the Board in the management of the business and affairs of the Corporation. Notices for meetings of a committee shall be given in the manner required by Section 9 of Article III hereof and may be waived in writing or dispensed with as 10 therein provided. A committee may adopt its own resolutions of procedure and may keep a record of its proceedings which shall be reported upon to the Board and filed with the minutes of the proceedings of the Board of such committee. ARTICLE V Officers SECTION 1. Number. The officers of the Corporation shall be a President, such number of Vice Presidents (including Executive and Senior Vice Presidents) as the Board may determine from time to time, a Treasurer and a Secretary. Each such officer shall be elected by the Board at its annual meeting and shall hold office until the next annual meeting of the Board and until his successor shall be elected or until his earlier death or resignation or removal in the manner hereinafter provided. Any number of offices may be held by the same person. The Board may elect or appoint such other officers of the Corporation (including one or more Assistant Treasurers and one or more Assistant Secretaries) as it shall deem necessary who shall have such authority and shall perform such duties as the Board may prescribe. If any additional officers shall be elected or appointed during the year, each of them shall hold office until the next annual meeting of the Board at which officers shall be regularly elected or appointed and until his successor shall be elected or appointed or until his earlier death or resignation or removal in the manner hereinafter provided. 11 A vacancy in any office may be filled for the unexpired portion of the term in the same manner as provided for election or appointment to such office. All officers elected or appointed by the Board or appointed by an officer shall be subject to removal at any time by the Board with or without cause. Any officer may resign at any time by giving written notice to the Board or the President or the Secretary of the Corporation, and such resignation shall take effect at the time specified therein or, if the time when it shall become effective shall not be specified therein, it shall take effect when accepted by action of the Board. Except as aforesaid, the acceptance of such resignation shall not be necessary to make it effective. SECTION 2. The President. The President of the Corporation, subject to the direction of the Board, shall be the chief executive officer of the Corporation, shall have general charge of the business and affairs of the Corporation, shall have the direction of all other officers, agents and employees and may assign such duties to the other officers of the Corporation as he shall deem appropriate. SECTION 3. Vice Presidents. Each Vice President of the Corporation shall have such powers and duties as shall be prescribed by the President of the Corporation or the Board. SECTION 4. Treasurer. The Treasurer shall be the chief financial officer of the Corporation and shall have charge and custody of all funds, 12 securities and other valuable effects owned or held by the Corporation, except those held elsewhere at the direction of the Board or the President, and shall deposit all such funds in the name and to the credit of the Corporation in such depositories as may by designated in accordance with the provisions of these By-laws. He shall disburse or cause to be disbursed the funds of the Corporation as may be directed by the Board or the President and shall keep true and full accounts of all receipts and disbursements and other transactions of the Corporation. He shall perform all duties and have all powers incident to the office of Treasurer and shall perform such other duties as shall be assigned to him by the Board or the President. The Treasurer may be assisted by one or more Assistant Treasurers. SECTION 5. Secretary. The Secretary of the Corporation shall keep the records of all meetings of stockholders and of the Board. He may affix the seal of the Corporation, if any, to all deeds, contracts, bonds or other instruments when the same shall have been signed on behalf of the Corporation by a duly authorized officer and shall be the custodian of all contracts, deeds, documents and all other indicia of title to properties owned by the Corporation and of its other corporate records, except accounting records. ARTICLE VI Contracts, Checks, Drafts, Bank Accounts, etc. SECTION 1. Execution of Documents. The Board shall designate the officers, employees and agents of the Corporation who shall have power to execute and deliver deeds, contracts, mortgages, bonds, debentures, checks, drafts and 13 other orders for the payment of money and other documents for and in the name of the Corporation and may authorize such officers, employees and agents to delegate such power (including authority to redelegate) by written instrument to other officers, employees or agents of the Corporation. SECTION 2. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation or otherwise as the Board, the President or any other officer of the Corporation to whom power in that respect shall have been delegated by the Board shall select. SECTION 3. Proxies in Respect of Stock or Other Securities of Other Corporations. The President or any officer of the Corporation designated by the Board shall have authority from time to time to appoint an agent or agents of the Corporation to exercise in the name and on behalf of the Corporation the powers and rights which the Corporation may have as the holder of stock or other securities or interest in any other corporation or business entity and to vote or consent in respect of such stock, securities or interest; such designated officers may instruct the person or persons so appointed as to the manner of exercising such powers and rights; and the President or such designated officers may execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal, if any, or otherwise, such written proxies, powers of attorney or other instruments as they may deem necessary or proper in order that the Corporation may exercise such power and rights. 14 ARTICLE VII Books and Records, Seal, Fiscal Year SECTION 1. Books and Records. The books and records of the Corporation may be kept at such places within or without the State of Delaware as the Board may from time to time determine. SECTION 2. Seal. The Board may by resolution provide a corporate seal In such form as shall be specified in such resolution. SECTION 3. Fiscal Year. The fiscal year of the Corporation shall end on the 31st day of December in each year. ARTICLE VIII Indemnification SECTION 1. Action, etc., Other than by or in the Right of the Corporation. The Corporation shall indemnify any person who shall be or shall have been a party or shall be threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that he shall be or shall have been a director, officer, employee or agent of the Corporation, or shall be or shall have been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and 15 amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he shall have acted in good faith and in a manner he reasonably shall have believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct shall have been unlawful. The termination of any action, suit or proceedings by judgment, order, settlement, conviction or upon a plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a presumption that the person shall not have acted in good faith and in a manner which he reasonably shall have believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, that he shall have had reasonable cause to believe that his conduct shall have been unlawful. SECTION 2. Actions, etc., by or in the Right of the Corporation. The Corporation shall indemnify any person who shall be or shall have been or is a party or shall be threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he shall be or shall have been a director, officer, employee or agent of the Corporation, or shall be or shall have been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he shall have acted in good faith and in a manner he reasonably shall have believed to be in or not opposed to the best interests of the Corporation, except that no indemnification shall be made in respect of any claim, 16 issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person shall be fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. SECTION 3. Determination of Right of Indemnification. Any indemnification under Section 1 or 2 of this Article (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent shall be proper in the circumstances because he shall have met the applicable standard of conduct set forth in Section 1 or 2 of this Article. Such determination shall be made (i) by the Board by a majority vote of a quorum consisting of directors who shall not have been parties to such action, suit or proceeding, (ii) if such a quorum shall not be obtainable, or, even if obtainable, a quorum of disinterested directors shall so direct, by independent legal counsel in a written opinion or (iii) by the stockholders. SECTION 4. Right to Indemnification. Notwithstanding the other provisions of this Article, to the extent that a director, officer, employee or agent of a corporation shall be successful on the merits in defense of any action, suit or proceeding referred to in Section 1 or 2 of this Article, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith. 17 SECTION 5. Prepaid Expenses. Expenses incurred by an officer or director in defending a civil or criminal action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an understanding by or on behalf of such officer or director to repay such amount unless it shall ultimately be determined that he shall be entitled to be indemnified by the Corporation as authorized in this Article. Such expenses incurred by other employees and agents may be so paid upon such terms and conditions, if any, as the Board deems appropriate. SECTION 6. Other Rights and Remedies. The indemnification and advancement of expenses provided by this Article shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled by law or under any agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office. SECTION 7. Insurance. Upon resolution passed by the Board, the Corporation may purchase and maintain insurance on behalf of any person who shall be or shall have been a director, officer, employee or agent of the Corporation, or shall be or shall have been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Corporation would have the power to indemnify him against such liability under the provisions of this Article. 18 SECTION 8. Status of Former Directors, etc. The indemnification and advancement of expenses provided by, or granted pursuant to, this Article shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. ARTICLE IX Shares and Their Transfer; Fixing Record Date SECTION 1. Certificate for Stock. Every owner of stock of the Corporation shall be entitled to have a certificate certifying the number of shares owned by him in the Corporation and designating the class of stock to which such shares belong, which shall otherwise be in such form as the Board shall prescribe. Each such certificate shall be signed by, or in the name of the Corporation by, the Chairman or a Vice Chairman of the Board, the President or a Vice President and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of the corporation. In case any officer who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer before such certificate is issued, it may nevertheless be issued by the Corporation with the same effect as if he were such officer at the date of issue. SECTION 2. RECORD. A record shall be kept of the name of the person, firm or corporation owning the stock represented by each certificate for stock of the Corporation issued, the number of shares represented by each such certificate and the date thereof, and, in the case of cancellation, the date of cancellation. 19 Except as otherwise expressly required by law, the person in whose name shares of stock stand on the books of the Corporation shall be deemed the owner thereof for all purposes as regards the Corporation. SECTION 3. Lost, Stolen, Destroyed or Mutilated Certificates. The holder of any stock of the Corporation shall immediately notify the Corporation of any loss, theft, destruction or mutilation of the certificate therefor. The Corporation may issue a new certificate for stock in the place of any certificate theretofore issued by it and alleged to have been lost, stolen, destroyed or mutilated, and the Board or the President or the Secretary may, in its or his discretion, require the owner of the lost, stolen, mutilated or destroyed certificate or his legal representatives to give the Corporation a bond in such sum, limited or unlimited, in such form and with such surety or sureties as the Board shall in its discretion determine, to indemnify the Corporation against any claim that may be made against it on account of the alleged loss, theft, mutilation or destruction of any such certificate or the issuance of any such new certificate. SECTION 4. Fixing Date for Determination of Stockholders of Record. (a) In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board may fix a record date, which shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which shall not be more than 60 or less than 10 calendar days before the date of such meeting. If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of 20 business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board may fix a new record date for the adjourned meeting. (b) In order that the Corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board and which date shall not be more than 10 calendar days after the date upon which the resolution fixing the record date is adopted by the Board. If no record date has been fixed by the Board, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board is otherwise required, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the registered office of the Corporation shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board and prior action by the Board is required, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board adopts the resolution taking such prior action. 21 (c) In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than 60 calendar days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto. ARTICLE X Amendments SECTION 1. Amendment. These By-laws may be altered or repealed by the vote of the Board, subject to the power of the stockholders of the Corporation to alter or repeal any By-law made by the Board. EX-3.17 15 y98028exv3w17.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.17 STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 03.00 PM 01/10/1996 960016575 - 2500409 CERTIFICATE OF INCORPORATION OF D-M-E COMPANY --------------------------------------------- A corporation organized pursuant to the General Corporation Law of the State of Delaware --------------------------------------------------------- ARTICLE I Name The name of the corporation (hereinafter called the "Corporation") is: D-M-E Company ARTICLE II Registered Office and Registered Agent The address of the Corporation's registered office in the State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle. The name of the Corporation's registered agent at such address is The Corporation Trust Company. ARTICLE III Business or Purposes To Be Conducted or Promoted The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware. 2 ARTICLE IV Capital Stock The total number of shares of all classes of capital stock which the Corporation shall have authority to issue is 1000 shares of Common Stock, and the par value of each of such shares is $l.00 amounting in the aggregate to $1,000. ARTICLE V Incorporator The name and mailing address of the sole incorporator of the Corporation is as follows: Hugh C. O'Donnell 4701 Marburg Avenue Cincinnati, Ohio 45209 ARTICLE VI Business and Affairs of the Corporation For the management of the business and for the conduct of the affairs of the Corporation, and in further definition, limitation and regulation of the powers of the Corporation and its directors and stockholders, it is further provided that: (a) the number of directors of the Corporation shall be fixed by, or in the manner provided in, the By-laws of the Corporation; (b) in furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Corporation, in the By-laws, may authorize and empower the Board of Directors to make, alter, amend or repeal from time to time the By-laws of the Corporation in any manner not inconsistent with the laws of the State of Delaware or this Certificate of Incorporation, subject to the right of the stockholders of the Corporation entitled to vote with respect thereto to alter, amend or repeal the By-laws of the Corporation; (c) in addition to the powers and authorities herein or by statute expressly conferred upon it, the Board of Directors may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the laws of the State of Delaware, of this Certificate of Incorporation and of the By-laws of the Corporation; 3 (d) unless and except to the extent that the By-laws of the Corporation shall so require, the election of directors of the Corporation need not be by written ballot; and (e) any director or any officer of the Corporation elected or appointed by its stockholders or by its Board of Directors, or any committee thereof, may be removed at any time by a unanimous consent of the stockholders or in such other manner as shall be provided in the By-laws, except at otherwise provided by law. ARTICLE VII Indemnification To the fullest extent that the General Corporation Law of the State of Delaware as it exists on the date hereof or as it may hereafter be amended permits the limitation or elimination of the liability of directors, so director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. No amendment to or repeal of this Article shall apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect to any acts or omissions of such director prior to such amendment or repeal. ARTICLE VIII Amendment The Corporation reserves the right at any time and from time to time to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, and other provisions authorized by the laws of the State of Delaware at the time in force or as may hereafter be added or inserted, in the manner now or hereafter prescribed by law and consistent with Article VII as now in force; and all rights, preferences and privileges of whatsoever nature conferred upon stockholders, directors or any other persons whomsoever by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended are granted subject to the right reserved in this Article. 4 I, the undersigned, being the sole incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the General Corporation Law of the State of Delaware, do make this certificate, hereby declaring and certifying, under penalties of perjury, that this is my act and deed and the facts herein stated are true, and accordingly have hereunto set my hand as of this eighteenth day of January, 1996. /s/ Hugh C. O'Donnell ------------------------ Incorporator EX-3.18 16 y98028exv3w18.txt BYLAWS EXHIBIT 3.18 BY-LAWS of D-M-E COMPANY ARTICLE I Offices SECTION 1.1. Offices. D-M-E Company (the "Corporation") may have offices either within or without the State of Delaware. The registered office of the Corporation and the name of the registered agent of the Corporation are as is set forth in the Certificate of Incorporation of the Corporation, or as may subsequently be or have been changed by resolution of the Board of Directors (the "Board"). ARTICLE II Meetings of Stockholders SECTION 2.1. Annual Meetings. An annual meeting of the stockholders of the Corporation for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held on such date as the Board may from time to time determine, and at such place and hour as shall be designated by the Board in the notice thereof. SECTION 2.2. Special Meetings. A special meeting of the stockholders for any purpose or purposes may be called at any time by the Board and such meeting shall be held on such date and at such place and hour as shall be designated in the notice thereof. SECTION 2.3. Notice of Meetings. Notice of each meeting of the stockholders shall be given not less than 10 nor more than 60 days before the date of the meeting to each stockholder of record entitled to notice of, or to vote at, such meeting by delivering a typewritten or printed notice thereof to such stockholder personally or by depositing such notice in the United States mail, postage prepaid, directed to such stockholder at his address as it appears on the stock record of the Corporation. Every such notice shall state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called. SECTION 2.4. Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty days, or if after the 2 adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. SECTION 2.5. Quorum and Manner of Acting. The presence in person or by proxy of stockholders holding of record a majority of the shares of stock of the Corporation entitled to be voted shall constitute a quorum for the transaction of business at any meeting of the stockholders. In the absence of a quorum at any such meeting or any adjournment or adjournments thereof, a majority in voting interest of those present in person or by proxy and entitled to vote thereat, or, in the absence therefrom of all the stockholders, any officer entitled to preside at, or to act as secretary of, such meeting, may adjourn such meeting from time to time in the manner provided in Section 2.4 until stockholders holding the amount of stock requisite for a quorum shall be present in person or by proxy. The absence from any meeting in person or by proxy of stockholders holding the number of shares of stock of the Corporation required for action upon any given matter, shall not prevent action at such meeting upon any other matter which may properly come before the meeting if there shall be present thereat, in person or by proxy, stockholders holding the number of shares of stock of the Corporation required in respect of such other matter. SECTION 2.6. Organization of Meetings. At each meeting of the stockholders, one of the following shall act as chairman of the meeting and preside thereat, in the following order of precedence: (a) the Chairman of the Board, or, if he is not present or if no person holds such office, any officer of the Corporation designated by the Board; or (b) any officer of the Corporation designated by a majority in voting interest of the stockholders present in person or by proxy and entitled to vote thereat. The person whom the chairman of the meeting shall appoint, shall act as secretary of the meeting and keep the minutes thereof. SECTION 2.7. Order of Business. The order of business at each meeting of the stockholders shall be determined by the chairman of the meeting, but such order of business may be changed by a majority in voting interest of those present in person or by proxy at such meeting and entitled to vote thereat. SECTION 2.8. Voting. Each stockholder shall, at each meeting of the stockholders, be entitled to one vote in person or by proxy for each share of stock of the Corporation which has voting power on the matter in question held by him and registered in his name on the stock record of the Corporation: (a) on the date fixed pursuant to the provisions of Section 8.6 of Article VIII of these By-laws as the record date for the determination of stockholders who shall be entitled to receive notice of and to vote at such meeting; or (b) if no record date shall have been so fixed, then at the close of business on the day next preceding the day on which notice of the meeting shall be given or, if notice 3 of the meeting shall be waived, at the close of business on the day next preceding the day on which the meeting shall be held, or if no record date for determining stockholders entitled to express consent to corporate action in writing without a meeting shall have been fixed, the day on which the first written consent is expressed. Shares of its own stock belonging to the Corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the Corporation, shall neither be entitled to vote nor be counted for quorum purposes. Any vote of stock of the Corporation may be given at any meeting of the stockholders by the person entitled to vote the same in person or by proxy appointed by an instrument in writing delivered to the secretary of the meeting; provided, however, that no proxy shall be voted or acted upon after three years from its date unless such proxy provides for a longer period. The attendance at any meeting of a stockholder who may theretofore have given a proxy shall not have the effect of revoking the same unless he shall in writing so notify the secretary of the meeting prior to voting of the proxy. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect. All other elections and questions shall, unless otherwise provided by these By-laws, be decided by the vote of the holders of shares of stock having a majority of the votes which could be cast by the holders of all shares of stock entitled to vote thereon which are present in person or represented by proxy at the meeting. Unless otherwise directed by the chairman of the meeting, the vote at any meeting of the stockholders on any question need not be by ballot. On a vote by ballot, each ballot shall be signed by the stockholder voting, or by his proxy if there be such proxy, and shall state the number of share voted. SECTION 2.9. Consent in Lieu of Meeting. Anything herein to the contrary notwithstanding, any action required to be taken at any annual or special meeting of stockholders of the Corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken at any annual or special meeting of such stockholders or may be taken without a meeting and without a vote if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and any certificate filed with respect to such matter shall state that such written notice has been given. SECTION 2.10. List of Stockholders. It shall be the duty of the officer of the Corporation who shall have charge of the stock ledger of record, either directly or through another officer of the Corporation or agent thereof, to prepare and make, at least 10 days before every meeting of the stockholders, a complete list of the stockholders entitled to vote thereat, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours for a period of at least 10 days prior to the meeting, either at the place where the meeting is to be held or at such other place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting. Such list shall also be produced and kept at the 4 time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present. The stock record shall be the only evidence as to who are the stockholders entitled to examine the stock record, such list or the books of the Corporation or to vote in person or by proxy at any meeting of the stockholders. SECTION 2.11. Inspectors. Either the Board or, in the absence of a designation of inspectors by the Board, the chairman of the meeting may, in its or his discretion, appoint two or more inspectors, who need not be stockholders, who shall receive and take charge of ballots and proxies and decide all questions relating to the qualification of those asserting the right to vote and the validity of ballots and proxies. In the event of the failure or refusal to serve of any inspector designated by the Board, the chairman of the meeting shall appoint an inspector to act in place of each such inspector designated by the Board. In the absence of a designation of inspectors by the Board and the chairman of the meeting, the secretary of the meeting shall perform the duties which would otherwise have been performed by the inspectors. ARTICLE III Board of Directors SECTION 3.1. General Powers. The property, business, affairs and policies of the Corporation shall be managed by or under the direction of the Board. SECTION 3.2. Number and Term of Office. The number of directors which shall constitute the Board shall be one or more persons as such number shall be fixed from time to time by a vote of a majority of the Board. Each of the directors of the Corporation shall hold office until the annual meeting after his election and until his successor shall be elected and shall qualify or until his earlier death or resignation or removal in the manner hereinafter provided. SECTION 3.3. Election. Except as provided in Section 3.6 of this Article III, directors shall be elected by a plurality of the votes cast at annual meetings of stockholders, and each director so elected shall hold office until the next annual meeting and until his successor is duly elected and qualified, or until his earlier death, resignation or removal. Directors need not be stockholders of the Corporation or residents of the State of Delaware. SECTION 3.4. Meetings. (a) Regular Meetings. Regular meetings of the Board or any committee thereof shall be held as the Board or such committee thereof shall from time to time determine. If any day fixed for a regular meeting shall be a legal holiday at the place where the meeting is to be held, then the meeting which would otherwise be held on that day, shall be postponed until the next succeeding business day. (b) Special Meetings. Special meetings of the Board, at which any and all business may be transacted, shall be held whenever called by President, Chairman or any two directors. 5 (c) Notice of Meetings. No notice of regular meetings of the Board or of any committee thereof or of any adjourned meeting thereof need be given. Notice shall be given to each director of each special meeting of the Board or adjournment thereof, including the time and place thereof. Notice of each such meeting shall be mailed to each director, addressed to him at his residence or usual place of business, at least two days before the day on which such meeting is to be held, or shall be sent to him at such place by facsimile, telegraph, cable, wireless or other form of recorded communication, or be delivered personally or by telephone not later than the day before the day on which such meeting is to be held, but notice need not be given to any director who shall attend such meeting. A written waiver of notice, signed by the person entitled thereto, whether before or after the time of the meeting stated therein, shall be deemed equivalent to notice. The purposes of a meeting of the Board or any committee thereof need not be specified in the notice thereof. (d) Time and Place of Meetings. Regular meetings of the Board or any committee thereof shall be held at such time or times and place or places as the Board or such committee may from time to time determine. Each special meeting of the Board or any committee thereof shall be held at such time and place as the caller or callers thereof may determine. In the absence of such a determination, each regular meeting or special meeting of the Board or any committee thereof shall be held at such time and place as shall be designated in the notices or waiver of notices thereof. (e) Quorum and Manner of Acting. A majority of the directors then in office and a majority of the members of any committee shall be present in person at any meeting thereof in order to constitute a quorum for the transaction of business at such meeting and the vote of a majority of the directors present at any such meeting at which a quorum is present shall be necessary for the passage of any resolution or for an act to be the act of the Board or such committee. In the absence of a quorum, a majority of the directors present thereat may adjourn such meeting from time to time until a quorum shall be present thereat. Notice of any adjourned meeting need not be given. (f) Organization of Meetings. At each meeting of the Board, the Chairman of the Board or, if he is not present or if no person holds such office, any director chosen by a majority of the directors present thereat shall act as chairman of the meeting and preside thereat. The person whom the chairman of the meeting shall appoint shall act as secretary of such meeting and keep the minutes thereof. The order of business at each meeting of the Board shall be determined by the chairman of such meeting. (g) Consent in Lieu of Meetings. Anything herein to the contrary notwithstanding, any action required or permitted to be taken at any meeting of the Board or any committee thereof, may be taken without a meeting if all members of the Board or such committee, as the case may be, consent thereto in a writing or writings and such writing or writings are filed with the minutes of the proceedings of the Board or such committee. (h) Action by Communications Equipment. The directors may participate in a meeting of the Board or any committee thereof by means of conference telephone or similar communications equipment by means of which all persons participating in the 6 meeting can hear each other and such participation shall constitute presence in person at such meeting. SECTION 3.5. Compensation. Each director, in consideration of his serving as such, shall be entitled to receive from the Corporation such amount per annum and such fees for attendance at meetings of the Board or of any committee, or both, as the Board shall from time to time determine. The Board may likewise provide that the Corporation shall reimburse each director or member of a committee for any expenses incurred by him on account of his attendance at any such meeting. Nothing contained in this Section shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. SECTION 3.6. Resignation, Removal and Vacancies. Any director may resign at any time by giving written notice of his resignation to the Board. Any such resignation shall take effect at the time specified therein or, if the time when it shall become effective shall not be specified therein, when accepted by the Board. Except as aforesaid, the acceptance of such resignation shall not be necessary to make it effective. Any director may be removed at any time for cause or without cause by vote of the holders of a majority in voting interest of shares then entitled to vote at an election of directors. The vacancy in the Board caused by any such removal may be filled by the stockholders at such meeting or as provided in the next paragraph of these By-laws. Any director may also be removed at any time for cause by vote of a majority of the Board. In the case of any vacancy on the Board or in the case of any newly created directorship, a director to fill the vacancy or the newly created directorship for the unexpired portion of the term being filled may be elected by a majority of the directors of the Corporation then in office, though less than a quorum, or by a sole remaining director. The director elected to fill such vacancy shall hold office of the unexpired term in respect of which such vacancy occurred and until his successor shall be elected and shall qualify or until his earlier death or resignation or removal in the manner herein provided. ARTICLE IV Committees SECTION 4.1. Number, Appointment, Term of Office, etc. The Board, by resolution or resolutions passed by a majority of the Board, may designate one or more committees, each committee to consist of one or more directors then in office. Each member of any such committee shall continue as such only so long as he remains a director and may be removed at any time, with or without cause, by a majority of the Board. Any vacancy on any committee may be filled at any time by the vote of a majority of the Board. In the absence or in case of the disqualification of a member or members of any such committee, the member or members of such committee present and not 7 disqualified from voting at a meeting of such committee, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board to act at such meeting in place of any absent or disqualified member. SECTION 4.2. Functions and Powers. Each committee shall have such functions and powers as the Board shall deem advisable and, subject to any limitations or restrictions which may be prescribed by resolution of the Board, if an Executive Committee is designated, it shall have and may exercise all the powers and authority of the Board in the management of the property, business, affairs and policies of the Corporation, including the power and authority to declare dividends and to authorize the issuance of stock of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it. SECTION 4.3. Rules. Subject to the provisions of these By-laws, each committee by resolution adopted by a majority of all the members thereof shall fix its rules of procedure. ARTICLE V Officers SECTION 5.1. Election and Appointment and Term of Office. The Corporation shall have such officers with such titles as shall be stated in a resolution of the Board, and with such duties as shall be given them as hereinafter provided or as may otherwise be specifically given them by the Board, but such officers shall include at least (a) a Chairman of the Board or one or more Vice-Chairman of the Board or a President or one or more Vice Presidents, or any or all the foregoing, and (b) a Secretary or one or more Assistant Secretaries or a Treasurer or one or more Assistant Treasurers, or any or all of the foregoing. One of such officers shall have the duty to record the proceedings of the meetings of stockholders and directors in a book to be kept for that purpose. Any number of offices may be held by the same person except that at least one person who holds an office referred to in clause (a) of the second preceding sentence shall not be the same as at least one person who holds any office referred to in clause (b) of the second preceding sentence. SECTION 5.2. Resignation, Removal and Vacancies. Any officer may resign at any time by giving written notice of his resignation to the Board. Any such resignation shall take effect at the time specified therein or, if the time when it shall become effective shall not be specified therein, when accepted by the Board. Except as aforesaid, the acceptance of such resignation shall not be necessary to make it effective. Any officer, agent or employee elected or appointed by the Board may be removed, with or without cause, at any time by the Board. Any agent or employee appointed by an officer may be removed, with or without cause, at any time by such officer. A vacancy in any office may be filled for the unexpired portion of the term in the same manner as provided in these By-laws for election or appointment to such office. 8 SECTION 5.3. Duties and Functions. If any of the following offices is created and a person appointed or elected thereto, and unless the Board otherwise provides, such offices and person shall have the following duties and functions: (a) Chairman. If a Chairman of the Board is appointed or elected, he shall be a member of the Board; shall preside at meetings of the Board and of the stockholders at which he shall be present; shall perform such duties as are incident to the office of the Chairman of the Board; and shall perform such other duties as may from time to time be prescribed by the Board. (b) Chairman. If any Vice-Chairman or Vice-Chairman of the Board are appointed or elected, they shall be members of the Board; shall preside at meetings of the Board and of the stockholders, unless a Chairman of the Board is appointed or elected and is present; shall perform such duties as are incident to the office of the Vice-Chairman of the Board; and shall perform such other duties as may from time to time be prescribed by the Board. (c) Chairman of the Executive Committee. If a Chairman of the Executive Committee is appointed or elected, he shall preside at meetings of the Executive Committee; shall when requested consult with and advise the other officers of the Corporation; and shall perform such other duties as may be agreed upon with them or as the Board or the Executive Committee may from time to time determine. (d) President. If a President is appointed or elected, he shall, subject to the control of the Board, have general charge and management of the property, business and affairs of the Corporation and shall have the direction of and may assign duties to all other officers (other than the Chairman and any Vice-Chairman, if either or both is appointed or elected), agents and employees. He shall preside at meetings of the Board and the stockholders unless a Chairman or a Vice-Chairman of the Board is appointed or elected and is present. (e) Vice Presidents. If any Vice President or Vice Presidents are appointed or elected, they shall have such powers and duties as shall be prescribed by the President, if one is appointed or elected, or the Board. Vice Presidents for this purpose shall include Senior, Executive, Assistant and all other categories or types of Vice Presidents. (f) Secretary. If a Secretary is appointed or elected, he shall attend and keep the records of all meetings of the stockholders and the Board in one or more books kept for that purpose; shall give or cause to be given due notice of all meetings in accordance with these By-laws and as required by law; shall notify the several officers of the Corporation of all action taken by the Board concerning matters relating to their duties; shall transmit to the proper officers copies of all contracts and resolutions approved by the Board or any committees of the Board; shall be custodian of the seal of the Corporation and of all contracts, deeds, documents and other corporate papers, records (except accounting records) and indicia of title to properties owned by the Corporation as shall not be committed to the custody of another officer by the President, if one is appointed or elected, or the Board; shall affix or cause to be affixed the seal of the Corporation to instruments requiring the same when the same have been signed on 9 behalf of the Corporation by a duly authorized officer; shall perform all duties and have all powers incident to the office of Secretary; and shall perform such other duties as shall be assigned to him by the President, if one is appointed or elected, or the Board. One or more Assistant Secretaries may be appointed or elected, who shall perform all the duties and have all the powers of the Secretary in the absence of or in case of a failure to appoint or elect or when so delegated by the Secretary, and as the President, if one is appointed or elected, or the Board may direct. (g) Treasurer. If a Treasurer is appointed or elected, he shall perform all duties incident to the office of Treasurer and such other duties as shall be assigned to him by the President, if one is appointed or elected, or the Board. One or more Assistant Treasurers may be appointed or elected who shall perform all the duties and have all the powers of the Treasurer in the absence of or in the case of a failure to appoint or elect or when so delegated by the Treasurer, and as the President, if one is appointed or elected, or the Board may direct. (h) Controller. If a Controller is appointed or elected, he shall perform all the duties incident to the office of Controller and such other duties as may be assigned to him by the President, if one is appointed or elected, or the Board. One or more Assistant Controllers may be appointed or elected who shall perform all the duties and have all the powers of the Controller in the absence of or in the case of a failure to appoint or elect or when so delegated by the Controller, and as the President, if one is appointed or elected, or the Board may direct. ARTICLE VI Waiver of Notices: Place of Meetings SECTION 6.1. Waiver of Notices. Anything herein to the contrary notwithstanding, whenever notice is required to be given to any director or member of a committee or stockholder, a waiver thereof in writing, signed by the person entitled to such notice shall be deemed equivalent to notice, whether given before or after the time specified therein and, in the case of a waiver of notice of a meeting, whether or not such waiver specifies the purpose of or business to be transacted at such meeting. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except where the person attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened, and does so object. SECTION 6.2. Place of Meetings. Any meeting of the stockholders, the Board or any committee may be held within or without the State of Delaware. ARTICLE VII Execution and Delivery of Documents; Deposits; Proxies; Books and Records SECTION 7.1. Execution and Delivery of Documents; Delegation. The Board shall designate the officers, employees and agents of the Corporation who shall have 10 power to execute and deliver deeds, contracts, mortgages, bonds, debentures, checks, drafts and other orders for the payment of money and other documents for and in the name of the Corporation and may authorize such officers, employees and agents to delegate such power (including authority to redelegate) by written instrument to other officers, employees or agents of the Corporation. Such delegation may be by resolution or otherwise and the authority granted shall be general or confirmed to specific matters, all as the Board may determine. In the absence of such designation referred to in the first sentence of this Section, the officers of the Corporation shall have such power so referred to, to the extent incident to the normal performance of their duties. SECTION 7.2. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation or otherwise as the Board or any officer of the Corporation to whom power in that respect shall have been delegated by the Board shall select. SECTION 7.3. Proxies in Respect of Stock or Other Securities of Other Corporations. Unless otherwise provided by the Board, any officer of the Corporation shall have the authority from time to time to appoint an agent of agents of the Corporation to exercise in the name and on behalf of the Corporation the powers and rights which the Corporation may have as the holder of stock or other securities in any other corporation, to vote or consent in respect of such stock or securities and to execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal or otherwise, such written proxies, powers of attorney or other instruments as he may deem necessary or proper in order that the Corporation may exercise such powers and rights. Such officer may instruct any person or persons appointed as aforesaid as to the manner of exercising such powers and rights. SECTION 7.4. Books and Records. The books and records of the Corporation may be kept at such places within or without the State of Delaware as the proper officers of the Corporation may from time to time determine. ARTICLE VIII Certificates; Stock Record; Transfer and Registration; New Certificates; Record Date, etc. SECTION 8.1. Certificates for Stock. Every holder of stock of the Corporation shall be entitled to have a certificate certifying the number of shares owned by him in the Corporation and designating the class of stock to which such shares belong, which shall otherwise be in such form as the Board shall prescribe. Each such certificate shall be signed by, or in the name of the Corporation by, the Chairman, a Vice-Chairman, the President or a Vice President of the Corporation and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of the Corporation. Any of or all such signatures may be facsimiles. In case any officer or authorized agent who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer or authorized agent before such certificate is issued, it may nevertheless be issued by the Corporation with the same effect as if he were such officer or authorized agent at the date of issue. Every certificate surrendered to the Corporation for exchange or transfer shall be canceled and a new certificate or 11 certificates shall not be issued in exchange for any existing certificate until such existing certificate shall have been so canceled, except in cases provided for in Section 8.4 of this Article. SECTION 8.2. Stock Record. A stock record in one or more counterparts shall be kept of the name of the person, firm or corporation owning the stock represented by each certificate for stock of the Corporation issued, the number of shares represented by each such certificate, the date thereof and, in the case of cancellation, the date of cancellation. The person in whose name shares of stock stand on the stock record of the Corporation shall be deemed the owner thereof for all purposes as regards the Corporation. SECTION 8.3. Transfer and Registration of Stock. (a) Transfer. The transfer of stock and certificates of stock which represent the stock of the Corporation shall be governed by Article 8 of Subtitle I of Title 6 of the Delaware Code (as amended from time to time, the "Uniform Commercial Code"). (b) Registration. Registration of transfers of shares of the Corporation shall be made only on the books of the Corporation by the registered holder thereof, or by his attorney thereunto authorized by power of attorney duly executed and filed with an officer of the Corporation, and on the surrender of the certificate or certificates for such shares properly endorsed or accompanied by a stock power duly executed. SECTION 8.4. New Certificates. (a) Lost, Stolen or Destroyed Certificates. Where a stock certificate has been lost, apparently destroyed or wrongfully taken, the issuance of a new stock certificate or the claims based on such certificate shall be governed by the Uniform Commercial Code. (b) Mutilated Certificates. Where the holder of any certificate for stock of the Corporation notifies the Corporation of the mutilation of such certificate within a reasonable time after he has notice of it, the Corporation will issue a new certificate for stock in exchange for such mutilated certificate theretofore issued by it. (c) Bond. The Board may, in its discretion, require the owner of the lost, stolen, destroyed or mutilated certificate to give the Corporation a bond in such sum, limited or unlimited, in such form and with such surety or sureties sufficient to indemnify the Corporation against any claim that may be made against it on account of the loss, theft, destruction or mutilation of any such certificate or the issuance of any such new certificate. SECTION 8.5. Regulations. The Board may make such rules and regulations as it may deem expedient, concerning the issue, transfer and registration of certificates for stock of the Corporation. SECTION 8.6. Fixing Date for Determination of Stockholders of Record. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights 12 in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days before the date of such meeting, nor more than 60 days prior to any other action. A determination of stockholders entitled to notice of or to vote at a meeting of the stockholders shall apply to any adjournment of the meeting; provided, however, that the Board may fix a new record date for the adjourned meeting. ARTICLE IX Seal SECTION 9.1. Seal. The Board shall provide a corporate seal which shall be in the form of a circle and shall bear the full name of the Corporation and the word "Delaware". ARTICLE X Fiscal Year SECTION 10.1. Fiscal Year. The fiscal year of the Corporation shall end on the last day of December in each year, or such other date as the Board may determine. ARTICLE XI Amendments SECTION 11.1. Amendments. These By-laws may be amended, altered or repealed by the vote of a majority of the Board, subject to the power of the holders of a majority of the outstanding stock of the Corporation entitled to vote in respect thereof, by their vote given at an annual meeting or at any special meeting, to amend, alter or repeal any By-law made by the Board. ARTICLE XII Subject to Law SECTION 12.1. Subject to Law. All provisions of these By-laws are subject to requirements of applicable law and the Certificate of Incorporation of the Corporation. ARTICLE XIII Indemnification SECTION 13.1 Indemnification of Officers and Directors. The Corporation shall indemnify each of its directors or officers, who shall serve as a director or officer of this Corporation or of any other corporation at the request of this Corporation, to the fullest extent permitted under and in accordance with the laws of the State of Delaware. 13 ARTICLE XIV Interested Directors SECTION 14.1 Interested Directors; Quorum. No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or committee thereof which authorizes the contract or transaction, or solely because his or their votes are counted for such purposes, if: (1) the material facts as to his relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (2) the material facts as to his relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (3) the contract or transaction is fair as to the corporation as of the time it is authorized, approved or ratified, by the Board of Directors, a committee thereof, or the stockholders. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction. EX-3.19 17 y98028exv3w19.txt RESTATED ARTICLES OF INCORPORATION EXHIBIT 3.19 RESTATED ARTICLES OF INCORPORATION OF MASTER UNIT DIE PRODUCTS, INC. 1. These Restated Articles of Incorporation are executed pursuant to the provisions of Sections 641-651, Act 284, Public Acts of 1972, as amended. 2. The present name of the corporation, which has remained unchanged since its initial incorporation, is MASTER UNIT DIE PRODUCTS, INC. 3. The date of filing the original articles of incorporation was January 3, 1958. 4. The following Restated Articles of Incorporation supersede the original Articles of Incorporation as amended and shall be the Articles of Incorporation of the corporation. ARTICLE I. The name of the corporation is MASTER UNIT DIE PRODUCTS, INC. ARTICLE II. The purpose for which the corporation is organized is to engage in any activity within the purposes for which corporations may be organized under the Business Corporation Act of Michigan. ARTICLE III. The total authorized capital stock is 20,000 shares of Common Stock, Par Value $10.00 per share. ARTICLE IV. The address of the current registered office is: 866 Fairplains, Greenville, Michigan 48838 The name of the current resident agent is Roger G. Martin. GOLD SEAL APPEARS ONLY ON ORIGINAL ARTICLE V The duration of the corporation is perpetual. ARTICLE VI When a compromise or arrangement or a plan of reorganization of this corporation is proposed between this corporation and its creditors or any class of them or between this corporation and its shareholders or any class of them, a court of equity jurisdiction within the state, on application of this corporation or of a creditor or shareholder thereof, or on application of a receiver appointed for the corporation, may order a meeting of the creditors or class of creditors or of the shareholders or class of shareholders to be affected by the proposed compromise or arrangement or reorganization, to be summoned in such manner as the court directs. If a majority in number representing 3/4 in value of the creditors or class of creditors, or of the shareholders or class of shareholders to be affected by the proposed compromise or arrangement or a reorganization, agree to a compromise or arrangement or a reorganization of this corporation as a consequence of the compromise or arrangement, the compromise or arrangement and the reorganization, if sanctioned by the court to which the application has been made, shall be binding on all the creditors or class of creditors, or on all the shareholders or class of shareholders and also on this corporation. GOLD SEAL APPEARS ONLY ON ORIGINAL -2- These Restated Articles of Incorporation were duly adopted by the shareholders on the 27th day of January, 1977, in accordance with the provisions of Section 642, Act 284, Public Acts of 1972, as amended. The necessary number of shares as required by statute were voted in favor of the Restated Articles of Incorporation. Dated this 19 day of February, 1977. MASTER UNIT DIE PRODUCTS, INC. By: /s/ Roger G. Martin ----------------------------------- Roger G. Martin, President GOLD SEAL APPEARS ONLY ON ORIGINAL CERTIFICATE OF AMENDMENT TO THE RESTATED ARTICLES OF INCORPORATION OF MASTER UNIT DIE PRODUCTS, INC. The undersigned corporation executes the following Certificate of Amendment to its Restated Articles of Incorporation pursuant to the provisions of Section 631, Act 284, Public Acts of 1972, as amended: 1. The name of the corporation is MASTER UNIT DIE PRODUCTS, INC. The location of the registered office is 866 Fairplains, Greenville, Michigan 48338. 2. The following amendment to the Restated Articles of Incorporation was adopted by the shareholders of the corporation in accordance with Subsection (2) of Section 611, Act 284, Public Acts of 1972, as amended, on the 7th day of June, 1979. RESOLVED, that Article III of the Restated Articles of Incorporation be amended to read in its entirety as follows: "ARTICLE III. The aggregate number of shares which the corporation shall have authority to issue is divided into the following classes:
Par Value Number of Shares Class Per Share Authorized ----- --------- ---------------- ~~Ordinary Common $1.00 400,000 Key Man Common $1.00 50,000~~
The preferences, limitations, designations and relative rights of each class of stock which the corporation is authorized to issue pursuant to this Article III are as follows: 3.1. Ordinary Common stock. 3.1.1. Voting. The holders of the Ordinary Common stock shall possess the full voting rights of the capital stock of the corporation and shall be entitled to one vote for each share of Ordinary Common stock held. GOLD SEAL APPEARS ONLY ON ORIGINAL 3.1.2. Dividends. The holders of the Ordinary Common stock shall be entitled to share equally with the holders of the Key Man Common stock on a per share basis in any dividends that may be declared by the Board of Directors of the corporation. 3.1.3. Liquidation. In the event of the voluntary or involuntary liquidation of the corporation, the net assets of the corporation, if any, shall be distributed pro rata among the holders of the Ordinary Common stock and the Key Man Common stock according to the number of shares held by each irrespective of the class to which such shares belong. 3.2. Key Man Common stock. 3.2.1. Voting. The holders of the Key Man Common stock shall possess no voting rights with respect to their Key Man Common stock, except where voting as a class is required by law to authorize an action. 3.2.2. Other Rights. Except for the right to vote, the Key Man Common stock shall be subject to and have the identical rights, privileges and restrictions as does the Ordinary Common stock." 3. The necessary number of shares as required by statute were voted in favor of the amendment. Signed this 7 day of June, 1979. MASTER UNIT DIE PRODUCTS, INC. By: /s/ Roger G. Martin ---------------------------------- Roger G. Martin, President GOLD SEAL APPEARS ONLY ON ORIGINAL -2- MICHIGAN DEPARTMENT OF CONSUMER AND INDUSTRY SERVICES CORPORATION, SECURITIES AND LAND DEVELOPMENT BUREAU Date Received (FOR BUREAU USE ONLY) Item 3c FILED ADJUSTED TO AGREE WITH BUREAU RECORDS APR 28 1999 Name Janet Welling c/o CT Corporation System Address 441 Vine Street, Suite 3810 City State Zip Code Cincinnati, OH 45202 EFFECTIVE DATE: - - Document will be returned to the name and address you enter above - CERTIFICATE OF CHANGE OF REGISTERED OFFICE AND/OR CHANGE OF RESIDENT AGENT FOR USE BY DOMESTIC AND FOREIGN CORPORATIONS AND LIMITED LIABILITY COMPANIES (PLEASE READ INFORMATION AND INSTRUCTIONS ON REVERSE SIDE) Pursuant to the provisions of Act 284, Public Acts of 1972 (profit corporations), or Act 162, Public Acts of 1982 (nonprofit corporations), or Act 23, Public Acts of 1993 (limited liability companies), the undersigned corporation or limited liability company executes the following Certificate: 1. The name of the corporation or limited liability company is: MASTER UNIT DIE PRODUCTS, INC. 2. The identification number assigned by the Bureau is: 122-159 3. a. The name of the resident agent on file with the Bureau is: MICHAEL G. MARTIN b. The location of the registered office on file with the Bureau is: 853 FAIRPLAINS GREENVILLE, Michigan 48838- ---------------------------------------- --------------------- (Street Address) (City) (Zip Code) c. The mailing address of the above registered office on file with the Bureau is: P.O. Box 520 Greenville, Michigan 48838 ------------------------------------------ --------------------- (Street Address or P.O. Box) (City) (Zip Code) ENTER IN ITEM 4 THE INFORMATION AS IT SHOULD NOW APPEAR ON THE PUBLIC RECORD 4. a. The name of the resident agent is: THE CORPORATION COMPANY b. The address of the registered office is: 30600 Telegraph Road Bingham Farms, Michigan 48025 --------------------------------------------- ------------------ (Street Address) (City) (Zip Code) c. The mailing address of the registered office IF DIFFERENT THAN 4B is: same as above, Michigan --------------------------------------------- ------------------ (Street Address) (City) (Zip Code) 5. The above changes were authorized by resolution duly adopted by: 1. ALL CORPORATIONS: its board of directors; 2. PROFIT CORPORATIONS ONLY: the resident agent if only the address of the registered office is changed, in which case a copy of this statement has been mailed to the corporation; 3. LIMITED LIABILITY COMPANIES: an operating agreement, affirmative vote of a majority of the members pursuant to section 502(1) managers pursuant to section 405, or the resident agent, if only the address of the registered office is changed. The corporation or limited liability company further states that the address of its registered office and the address of its resident agent, as changed, are identical. Signature Type or Print Name and Title Date Signed /s/ Hugh C. O'Donnell Hugh C. O'Donnell, Secretary April 15, 1999 (MI - 54 - 2/27/97) M-K GOLD SEAL APPEARS ONLY ON ORIGINAL MICHIGAN DEPARTMENT OF CONSUMER AND INDUSTRY SERVICES CORPORATION, SECURITIES AND LAND DEVELOPMENT BUREAU Date Received (FOR BUREAU USE ONLY) This document is effective on the date filed, unless a subsequent effective date within 90 days after received date is stated in the document. Name A. STUART TOMPKINS Address P. O. Box 222 City State Zip Code EFFECTIVE DATE SOUTHFIELD MI 48037-0222 - - Document will be returned to the name and address you enter above. - If left blank document will be mailed to the registered office. CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION FOR USE BY DOMESTIC PROFIT AND NONPROFIT CORPORATIONS (Please read information and instructions on the last page) Pursuant to the provisions of Act 284, Public Acts of 1972 (profit corporations), or Act 162, Public Acts of 1982 (nonprofit corporations), the undersigned corporation executes the following Certificate: 1. The present name of the corporation is: MASTER UNIT DIE PRODUCTS, INC. 2. The identification number assigned by the Bureau is: 122-159 3. Article I of the Articles of Incorporation is hereby amended to read as follows: The name of the corporation is D-M-E U.S.A. Inc. GOLD SEAL APPEARS ONLY ON ORIGINAL COMPLETE ONLY ONE OF THE FOLLOWING: 4. (For amendments adopted by unanimous consent of incorporators before the first meeting of the board of directors or trustees.) The foregoing amendment to the Articles of Incorporation was duly adopted on the _______ day of ____________, 19___________. In accordance with the provisions of the Act by the unanimous consent of the incorporators(s) before the first meeting of the Board of Directors or Trustees. Signed this___________ day of___________, 19_________ __________________________________ ____________________________________ (Signature) (Signature) __________________________________ ____________________________________ (Type or Print Name) (Type or Print Name) __________________________________ ____________________________________ (Signature) (Signature) __________________________________ ____________________________________ (Type or Print Name) (Type or Print Name) 5. (For profit and nonprofit corporations whose Articles state the corporation is organized on a stock or on a membership basis.) The foregoing amendment to the Articles of incorporation was duly adopted on the 3rd day of November, 1999 by the shareholders if a profit corporation, or by the shareholders or members if a nonprofit corporation (check one of the following) [ ] at a meeting the necessary votes were cast in favor of the amendment. [ ] by written consent of the shareholders or members having not less than the minimum number of votes required by statute in accordance with Section 407(1) and (2) of the Act. If a nonprofit corporation, or Section 407(1) of the Act if a profit corporation. Written notice to shareholders or members who have not consented in writing has been given. (Note: Written consent by less than all of the shareholders or members is permitted only if such provision appears in the Articles of Incorporation.) [X] by written consent of all the shareholders or members entitled to vote in accordance with section 407(3) of the Act if a nonprofit corporation, or Section 407(2) of the Act if a profit corporation. [ ] by the board of a profit corporation pursuant to section 611(2). Profit Corporations Nonprofit Corporations Signed this 17 day of November, 1999 Signed this _____day of ________, 19_____ By: /s/ Hugh C. O'Donnell By:______________________________________ ------------------------------- (Signature of an authorized (Signature of President, Vice- officer or agent) President, Chairperson or Vice-Chairperson) _________________________________ _________________________________________ (Type or Print Name) (Type or Print Name) (Type or Print Name) GOLD SEAL APPEARS ONLY ON ORIGINAL EX-3.20 18 y98028exv3w20.txt AMENDED AND RESTATED BYLAWS EXHIBIT 3.20 Adopted as of Jan. 27, 1977 AMENDED AND RESTATED BYLAWS OF MASTER UNIT DIE PRODUCTS, INC. ARTICLE I - OFFICES Section 1. Business Offices. The principal office of the corporation in the State of Michigan shall be located at 866 Fairplains Street in the City of Greenville, County of Montcalm. The corporation may have such other offices, either within or without the State of Michigan as the Board of Directors may designate or as the business of the corporation may require from time to time. Section 2. Registered Office. The registered office of the corporation (required by the Michigan Business Corporation Act to be maintained in the State of Michigan) may be, but need not be, identical with the principal office in the State of Michigan, and the address of the registered office may be changed from time to time by the Board of Directors. ARTICLE II - SHAREHOLDERS' MEETINGS Section 1. Annual Meetings. The annual meeting of the shareholders shall be held on such day in the month of January and at such place as the directors shall determine, for the purpose of electing directors and for the transaction of such other business as may come before the meeting. If the election of directors shall not be held at the time designated for the annual meeting of the shareholders or at any adjournment thereof, the Board of Directors shall cause the election to be held at a special meeting of the shareholders as soon thereafter as convenient. Section 2. Special Meetings. Special meetings of the shareholders, for any purpose or purposes, unless otherwise prescribed by statute, may be called by the President or the Board of Directors, and shall be called by the President at the request of the holders of not less than 10% of all the outstanding shares of the corporation entitled to vote at the meeting. Section 3. Place of Meeting. The Board of Directors may designate any place, either within or without the State of Michigan, as the place of meeting for any annual meeting, or for any special meeting called by the Board of Directors. A waiver of notice signed by all shareholders entitled to vote at a meeting may designate any place, either within or without the State of Michigan, as the place of the holding of such meeting. If no designation is made, or if a special meeting be otherwise called, the place of meeting shall be the principal office of the corporation in the State of Michigan, but any meeting may be adjourned to reconvene at any place designated by vote of a majority of the shares represented thereat. Section 4. Notice of Meeting. Written notice stating the place, day and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than ten days, unless a longer minimum notice period is required by law, nor more than sixty days before the date of the meeting either personally or by mail to each shareholder of record entitled to vote at the meeting. If mailed, such notice shall be deemed to be delivered when deposited in a post office or official depository under the exclusive care and custody of the United States Postal Service, addressed to the shareholder at his address as it appears on the stock record books of the corporation, with postage thereon prepaid. Section 5. Waiver of Notice by Shareholders. Whenever any notice whatever is required to be given to any shareholder of the corporation under the provisions of these bylaws or under the provisions of the articles of incorporation or under the provisions of any statute, a waiver thereof in writing, signed at any time, whether before or after the time of meeting, by the shareholder entitled to such notice, shall be deemed equivalent to the giving of such notice. Attendance of a person at a meeting of shareholders, in person or by proxy constitutes a waiver of notice of the meeting, except when the shareholder attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Section 6. Action by Shareholders Without a Meeting. Any action required or permitted to be taken at an annual or special meeting of shareholders may be taken without a meeting, without prior notice and without a vote, if all the shareholders entitled to vote thereon consent thereto in writing. Section 7. Fixing of Record Date. For the purpose of determining shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or -2- allotment of any rights, or in order to make a determination of shareholders for any other lawful purpose, the Board of Directors of the Corporation may fix, in advance, a date as the record date for any such determination of shareholders, such date in any case to be not more than sixty nor less than ten days prior to the date of any proposed meeting of shareholders, nor more than sixty days before any other action. In no event shall the stock transfer books be closed. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this Section, such determination shall be applied to any adjournment thereof, unless the Board of Directors fixes a new record date under this Section for the adjourned meeting. Section 8. Quorum. A majority of the outstanding shares of the corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders. The shareholders present in person or by proxy at such meeting may continue to do business until adjournment notwithstanding the withdrawal of enough shareholders to leave less than a quorum. Though less than a quorum of the outstanding shares are represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally called. Section 9. Proxies. At all meetings of shareholders, a shareholder entitled to vote may vote by proxy appointed in writing by the shareholder or by his authorized agent or representative. Such proxy shall be filed with the Secretary of the corporation before or at the time of the meeting. No proxy shall be valid after three years from the date of its execution, unless otherwise provided in the proxy. Section 10. Voting of Shares. Each outstanding share entitled to vote shall be entitled to one vote upon each matter submitted to a vote at a meeting of shareholders. Section 11. List of Shareholders. A complete list of the shareholders entitled to vote at each meeting of shareholders or any adjournment thereof, arranged in alphabetical order, and showing the address of each shareholder and the number of shares registered in the name of each shareholder shall be prepared by the officer or agent of the corporation having charge of the stock transfer books. Such list shall be produced at the time and place of the meeting during the whole time thereof, and be subject to the inspection of any shareholder. Such list shall be -3- prima facie evidence as to who are the shareholders entitled to examine the list and to vote at the meeting. ARTICLE III - BOARD OF DIRECTORS Section 1. General Powers. The business and affairs of the corporation shall be managed by its Board of Directors. Section 2. Number, Tenure and Qualifications. The number of directors of the corporation shall be six (6) or such other number as may be fixed from time to time by action of the shareholders. Each director shall hold office until the annual meeting of shareholders next following his election and until his successor is elected and qualified, or until his death, resignation or removal if that should sooner occur. Section 3. Regular Meetings. The Board of Directors may from time to time provide by resolution the time and place, either within or without the State of Michigan, for the holding of regular meetings of the Board of Directors. Such regular meetings may be held without other notice than such resolution. Section 4. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the President or of the Secretary or any one of the directors. The person or persons calling such meeting may fix any time or place for holding any special meeting of the Board of Directors called by them. Section 5. Notice of Meeting. Notice of any special meeting shall be given at least seventy-two (72) hours prior thereto by written notice delivered personally or mailed to each director at the address designated by him for that purpose or, if none is designated, at his last known address or by telegram. If mailed, such notice shall be deemed to be delivered when deposited so addressed in a post office or official depository under the exclusive care and custody of the United States Postal Service, with postage thereon prepaid. If notice is given by telegram, such notice shall be deemed to be delivered when given to the telegraph company. Section 6. Waiver of Notice by Directors. Whenever any notice whatever is required to be given to any director of the corporation under the provisions of these bylaws or under the provisions of the articles of incorporation or under the provisions of any statute, a waiver thereof in writing, signed at any time, whether before or after the time of meeting, by the director entitled to such notice, shall be deemed equivalent to the giving -4- of such notice. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting. section 7. Quorum. A majority of the directors then in office shall constitute a quorum for the transaction of business at any meeting of the Board of Directors; but though less than such quorum is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice. Section 8. Presence by Means of Telephone. A director shall be deemed to be present in person at a meeting of the directors if he participates in the meeting by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Section 9. Manner of Acting. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, unless the act of a greater number is required by statute. Section 10. Action by Directors Without a Meeting. Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if, before or after the action, all members of the Board or of the committee, as the case may be, shall have signed a written consent. Any such written consents shall be filed with the minutes of the proceedings of the Board or the committee. Section 11. Removal. A director or the entire board may be removed, with or without cause, by vote of the holders of a majority of the shares entitled to vote at an election of directors. Section 12. Vacancies. Any vacancy occurring in the Board of Directors, including a vacancy created by an increase in the number of directors, may be filled until the next succeeding annual election by the affirmative vote of a majority of the directors then in office though less than a quorum of the Board of Directors. Section 13. Compensation. The Board of Directors by -5- affirmative vote of a majority of the directors then in office, and irrespective of any personal interest of any of its members, may establish reasonable compensation of all directors for services to the corporation as directors, officers or otherwise, or may delegate such authority to an appropriate committee. Section 14. Presumption of Assent. A director of the corporation who is present at a meeting of the Board of Directors or a committee thereof at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent to such action with the person acting as the Secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the Secretary of the corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action. Section 15. Committees. The Board of Directors may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. The Board of Directors shall have the power at any time to fill vacancies in, to change the membership of, or to discharge any such committee, or to designate additional committees. The Board of Directors shall have the power to appoint employees of the corporation who are not members of the Board of Directors to serve as advisory, non-voting consultants to any such committees. Any committees, to the extent provided in the resolutions of the Board creating such committee and subject to the limitations provided by statute, shall have and may exercise the powers of the whole Board of Directors in the management of the business and affairs of the corporation. Section 16. Dividends. Subject always to the provisions of law and the articles of incorporation, the Board of Directors shall have full power to determine whether any, and if any, what part of any, funds legally available for the payment of dividends shall be declared in dividends and paid to shareholders; the division of the whole or any part of such funds of the corporation shall rest wholly within the lawful discretion of the Board of Directors, and it shall not be required at any time, against such discretion, to divide or pay any part of such funds among or to the shareholders as dividends or otherwise; and the Board of Directors may fix a sum which may be set aside or reserved over -6- and above the capital paid in of the corporation as working capital for the corporation or as a reserve for any proper purpose, and from time to time may increase, diminish, and vary the same in its absolute judgment and discretion. ARTICLE IV - OFFICERS Section 1. Number. The Board of Directors, as soon as practicable after the election thereof held in each year, shall elect a President, a Secretary and a Treasurer, and from time to time may elect one or more Vice Presidents and such Assistant Secretaries, Assistant Treasurers and such other officers, agents and employees as it may deem proper. Any two offices other than the offices of President and Secretary may be held by the same person. Section 2. Election and Term of Office. Each officer shall hold office for the term for which he was elected and until his successor shall have qualified or until his death or until he shall resign or shall have been removed in the manner hereinafter provided. Section 3. Removal. Any officer or agent elected or appointed by the Board of Directors may be removed by the Board of Directors, whenever in its judgment the best interests of the corporation will be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed. Election or appointment shall not of itself create contract rights. Section 4. Vacancies. A vacancy in any principal office because of death, resignation, removal, disqualification or otherwise shall be filled by the Board of Directors for the unexpired portion of the term. Section 5. President. The President shall be the principal executive officer of the corporation and, subject to the control of the Board of Directors, shall in general supervise and control all of the business and affairs of the corporation. He shall, when present, preside at all meetings of the shareholders and Board of Directors. He may sign, with the secretary or any other proper officer of the corporation thereunto authorized by the Board of Directors, certificates for shares of the corporation, any deeds, mortgages, bonds, contracts, or other instruments which the Board of Directors has authorized to be executed, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors or by these bylaws -7- or some other law to be otherwise signed or executed, and in general shall perform all duties incident to the office of President and such other duties as may be prescribed by the Board of Directors from time to time. Section 6. Vice President. In the absence of the President, or in the event of his death or inability to act, the Vice President, if any, or if more than one, then in the order designated by the Board of Directors, shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Section 7. Secretary. The Secretary shall: (a) keep the minutes of the shareholders' and the Board of Directors' meetings in one or more books provided for that purpose; (b) see that all notices are duly given in accordance with the provisions of these bylaws or as required by law; (c) be custodian of the corporate records and of the seal of the corporation and see that the seal of the corporation is affixed to all documents the execution of which on behalf of the corporation under its seal is duly authorized; (d) keep a register of the post office address of each shareholder; (e) sign with the President or a Vice President certificates for shares of the corporation, the issuance of which shall have been authorized by resolution of the Board of Directors; (f) have general charge of the stock transfer books of the corporation; and (g) in general perform all duties incident to the office of Secretary and such other duties as from time to time may be assigned to him by the President or by the Board of Directors. Section 8. Treasurer. If required by the Board of Directors, the Treasurer shall give a bond for the faithful discharge of his duties in such sum and with such surety or sureties as the Board of Directors shall determine. He shall: (a) have charge and custody of and be responsible for all funds and securities of the corporation; receive and give receipts for monies due and payable to the corporation from any source whatsoever, and deposit all such monies in the name of the corporation in such banks, trust companies or other depositories as shall be selected in accordance with the provisions of these bylaws; and (b) in general perform all of the duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him by the President or by the Board of Directors. Section 9. Salaries. The salaries of the officers shall be fixed from time to time by the Board of Directors and no officer shall be prevented from receiving such salary by reason of the fact that he is also a director of the corporation. -8- Section 10. Officer Reimbursement. Each officer by accepting his office agrees that any payments made to him by the corporation such as a salary, commission, bonus, interest, or rent, or entertainment expense incurred by him, which shall be disallowed in whole or in part as a deductible expense by the Internal Revenue Service, shall be reimbursed by such officer to the corporation to the full extent of such disallowance. It shall be the duty of the directors, as a Board, to enforce payment of each such amount disallowed. In lieu of payment by the officer, subject to the determination of the directors, proportionate amounts may be withheld from his future compensation payments until the amount owed to the corporation has been recovered. ARTICLE V CERTIFICATES FOR SHARES AND THEIR TRANSFER Section 1. Certificates for Shares. Subject to the requirements of law, certificates representing shares of the corporation shall be in such form as shall be determined by the Board of Directors. Such certificates shall be signed by the President or a Vice President and by the Secretary. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the stock transfer books of the corporation. All certificates surrendered to the corporation for transfer shall be cancelled and no new certificates shall be issued until the former certificate for a like number of shares shall have been surrendered and cancelled, except that in case of a lost, destroyed or mutilated certificate a new one may be issued therefor upon such terms and indemnity to the corporation as the Board of Directors may prescribe. Section 2. Facsimile Signatures. If a transfer agent or registrar is appointed and countersigns certificates representing shares of the corporation, the signatures of the officers of the corporation on such certificates may be facsimiles. Section 3. No Preemptive Rights. No holder of shares of the capital stock of any class of the corporation shall have any preemptive right of subscription to any shares of any class of stock of the corporation, whether now or hereafter authorized. ARTICLE VI - INDEMNIFICATION Section 1. Actions Against Directors and Officers. Subject to the other provisions of these bylaws, the corporation -9- shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director or officer of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement, actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interest of the corporation, or its shareholders, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, or its shareholders, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. Section 2. Actions by Corporation. Subject to the other provisions of these bylaws, the corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director or officer of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, or its shareholders, and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the corporation unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper. -10- Section 3. Expenses. To the extent that a person who is a director or officer of the corporation or who is a director or officer of another corporation, partnership, joint venture, trust or other enterprise in which he is serving at the request of the corporation, has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 1 and 2 of this Article VI, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith. Section 4. Good Faith. Any indemnification under Sections 1 and 2 of this Article VI (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the person is proper in the circumstances because he has met the applicable standard of conduct set forth in said Sections 1 and 2. Such determination shall be made in any of the following ways: (1) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding; (2) if such a quorum is not obtainable, or even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion; or (3) by the shareholders. Section 5. Prepayment. Expenses incurred in defending a civil or criminal action, suit or proceeding described in Sections 1 and 2 of this Article VI may be paid by the corporation in advance of the final disposition of such action, suit or proceeding as authorized in the manner provided in Section 4 of this Article VI upon receipt of an undertaking by or on behalf of the person for whom such expenses are being paid to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the corporation. Section 6. Persons Not Directors or Officers. Persons for whom indemnification is not provided in Sections 1 and 2 of this Article VI but who are employees or agents of the corporation or are serving at the request of the corporation as employees or agents of another corporation, partnership, joint venture, trust or enterprise may be indemnified to the extent authorized at any time or from time to time by the Board of Directors of the corporation subject, however, to the limitations set forth in this Article VI. Section 7. Persons Who Have Ceased to Hold Office. The indemnification provided in this Article VI shall continue as -11- to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person. Section 8. Implied Contract. The assumption by a person of a term of office as a director or officer of the corporation or, at the request of the corporation, as a director or officer of another corporation, partnership, joint venture, trust or other enterprise, shall constitute a contract, entitling such person, during such term of office, to all of the rights and privileges of indemnification afforded by this Article VI as in effect as of the date of his assumption of such term of office, but such contract shall not prevent the amendment of this Article VI in respect of any future term of office of such persons or in respect of any other person. Section 9. Insurance. The corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him in any such capacity or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liability under the provisions of this Article VI or of the Michigan Business Corporation Act. Section 10. Invalidity of Part. The invalidity or enforceability of any provision of this Article VI shall not affect the validity or enforceability of any other provision hereof. ARTICLE VII - AMENDMENTS The shareholders or Board of Directors may, amend, alter or repeal any of these bylaws except to the extent that any such bylaw has hereinafter been enacted by the Shareholders of the Corporation with specific limitations upon the power of the Board of Directors to amend, alter or repeal such bylaw. -12- EX-3.21 19 y98028exv3w21.txt ARTICLES OF AMALGAMATION Exhibit 3.21 For Ministry Use Only Ontario Corporation Number A l'usage exclusif du ministere Numero de la compagnie en Ontario [LOGO] Ministry of Ministere de 574439 Consumer and la Consommation Commercial et du Commerce Relations CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les presents articles are effective on statuts entrent en vigueur le JANUARY 1 JANVIER, 1984 Trans Line Comp Method code No Stat Type Incorp Share [ A ] [ D ] [ 0 ] [ A ] [ 3 ] [ S ] /s/ [ILLEGIBLE] 18 20 28 29 30 31 - ------------------- [ILLEGIBLE] Notice Reg'd Jurisdiction [ N ] [ ONTARIO ] [ A ] 32 33 47 57 - -------------------------------------------------------------------------------- ARTICLES OF AMALGAMATION STATUTS DE FUSION Form A 1. The name of the corporation is: Denomination sociale de la compagnie issue de la fusion: Business Corporations Act D-M-E O F C A N A D A L I M I T E D 1982 2. The address of the registered office is: Adresse du siege social: Formule 6210 Northwest Drive numero 4 ------------------------------------------------------------------------------------------------ Loi de 1982 Street & Number or R R Number & if Multi-Office Building give Room No: sur les Rue et numero de la R R et s'il s'agit d'un edifice compagnies a bureaux numero de bureau: Mississauga, Ontario [ L 4 V I J 6 ] ------------------------------------------------------------------------------------------------ Name of Municipality or Post Office (Postal Code) Nom de la municipalite ou du bureau de poste (Code Postal) Regional Municipality City Of Mississauga in the of Peel ------------------------ dans le/la ------------------------------------------- Name of Municipality (County, District, Regional Geographical Township municipality) (Nom de la municipalite (Comte, district, municipalite du canton) regionale) 3. Number (or minimum and maximum number ) of Nombre (ou nombres minimal of maximal) director is: d'administrateurs: FOUR (4) 4. The director(s) is/are: Administrateur(s): Resident First name, initials and surname Residence address giving Street & No. R. R. Canadian Prenom, initials et nom de famille No. Municipality and Postal Code State Addresse personnelle, y compris la rue et le yes or no numero, le numero, de la R.R. ou le nom de la Resident municipalite et le code postal Canadien Oui/Non ------------------------------------------------------------------------------------------------ Jerry A. Lirette 1547 Kensington, No Bloomfield Hills, MI 48013 Cyrus McGrath 45 Marksam Road, Unit 17, Yes Guelph, Ontario NIH 6Y9 David W. Smith 48 Hillhurst Boulevard, Yes Toronto, Ontario M5N 1N6 Orey Fidani 48 Edenbrook Hill, Yes Toronto, Ontario M9N 3Z9

DYE & DURHAM FORM 4(B C A) 2 5. A) The amalgamation agreement [ ]A) Les actionnaires de chaque has been duly adopted by the compagnie qui fusionne ont shareholders of each of the dument adopte la convention de amalgamating corporations as fusion conformement au paragraphe required by subsection 175(4) of 175(4) de la Loi sur les compagnies the Business Corporations Act on a la date mentionnee ci-dessous. the date set out below. Check Cocher A or B A ou B B) The amalgamation has been approved [X]B) Les administrateurs de chaque by the directors of each compagnie qui fusionne ont approuve amalgamating corporation by a la fusion par voie de resolution resolution as required by section conformement a l'article 176 de la 176 of the Business Corporations Loi sur les compagnies a la date Act on the date set out below. mentionnee ci-dessous. Les statuts de fusion reprennent The articles of amalgamation in essentiellement les dispositions substance contain the provisions of des statuts constitutifs de the articles of incorporation of D-M-E of Canada Limited and are more particularly set out et sont enonces textuellement aux in these articles presents statuts.
Names of amalgamating corporations Denomination sociale Ontario Corporation Number des compagnies qui Numero de la compagnie en Date of Adoption Approval fusionnent Ontario Date d'adoption ou d'approbation - -------------------------- -------------------------- -------------------------------- ~~D-M-E of Canada 257680 December 21, 1983 Limited Cardkey Systems of Canada, 438112 December 21, 1983 Limited~~
3 6. Restrictions, if any, on business Limites, s'il y a lieu, imposees aux the corporation may carry on or on activites commerciales ou aux pouvoirs powers the corporation exercise. de la compagnie. There are no restrictions on the business that the Corporation may carry on. 7. The classes and any maximum number Categories et nombre maximal, s'il y a of shares that the corporation is lieu, d'actions que la compagnie est authorized to issue. autorisee a emettre: The Corporation is authorized to issue 1,000 common shares without par value. 4 8. Rights, privileges, restrictions Droits, privileges, restrictions et and conditions (if any) attaching conditions, s'il y a lieu, rattaches a to each class of shares and chaque categorie d'actions et pouvoirs directors authority with respect to des administrateurs relatifs a chaque any class of shares which is to be categorie d'actions qui peut etre emise issued in series: en serie: Not applicable. restricted and the restrictions est/n'est pas restreinte. Les (if any) are as follows: restrictions, s'il y a lieu, sont les suivantes: 1. The right to transfer shares of the Corporation shall be restricted in that no shareholder shall be entitled to transfer any share or shares in the capital of the Corporation without either (a) the previous express sanction of the holders of more than fifty percent (50%) of the common shares of the Corporation for the time being outstanding expressed by a resolution passed at a meeting of the shareholders or by an instrument or instruments in writing signed by the holders of more than fifty percent (50%) of such shares, or (b) the previous express sanction of the directors of the Corporation expressed by a resolution passed by the votes of a majority of the directors of the Corporation at a meeting of the board of directors or by an instrument or instruments in writing signed by a majority of the directors. (....Continued on 5A) 10. Other provisions, (if any): Autres dispositions, s'il y a lieu. Not applicable. 11. The statements required by Les declarations exigees aux termes du subsection 177(2) of the Business paragraphe 177(2) de la Loi sur les Corporations Act are attached as compagnies constituent l'annexe "A". Schedule "A". 12 A copy of the amalgamation Une copie de la convention de fusion agreement or directors resolutions ou les resolutions des administrateurs (as the case may be) is/are (selon le cas) constitute(nt) l'annexe attached as Schedule "B". "B". 2. The number of shareholders of the Corporation, exclusive of persons who are in its employment and exclusive of persons who, having been formerly in the employment of the Corporation, were, while in that employment, and have continued after the termination of that employment to be, shareholders of the Corporation, is limited to not more than fifty, two or more persons who are the joint registered owners of one or more shares being counted as one shareholder. 3. Any invitation to the public to subscribe for securities of the Corporation is prohibited. 6 These articles are signed in Les presents statuts sont signes en duplicate. double exemplaire. Names of the amalgamating Denomination sociale des compagnies corporations and signatures and qui fusionnent signature et descriptions of office of their fonction de leurs dirigeants proper officers. regulierement designes. D-M-E OF CANADA LIMITED /s/ G. Ralph Bartolme C.S. ------------------------------------ G. Ralph Bartolme, Vice-President CARDKEY SYSTEMS OF CANADA, LIMITED /s/ G. Ralph Bartolme C.S. ------------------------------------ G. Ralph Bartolme, Vice-President & Secretary SCHEDULE A IN THE MATTER OF the Business Corporations Act, 1982 and the Articles of Amalgamation of D-M-E OF CANADA LIMITED and CARDKEY SYSTEMS OF CANADA, LIMITED. I, G. RALPH BARTOLME, of the city of Laguna Niguel, in the State of California, do DECLARE THAT: 1. I am the Vice-President of D-M-E of Canada Limited (hereinafter called the "Corporation") which is to be amalgamated with Cardkey Systems of Canada, Limited into an amalgamated corporation (hereinafter called the "Amalgamated Corporation") and as such have personal knowledge of the matters herein declared. 2. I have conducted such examinations of the books and records of the Corporation and have made such enquiries and investigations as are necessary to enable me to make this declaration. 3. I have satisfied myself that: (a) there are reasonable grounds for believing that the Corporation is and the Amalgamated Corporation will be able to pay its liabilities as they become due; (b) there are reasonable grounds for believing that the realizable value of the Amalgamated Corporation's assets will not be less than the aggregate of its liabilities and stated capital of all classes; and (c) there are reasonable grounds for believing that no creditor of the Corporation will be prejudiced by the amalgamation. DATED the 21st day of December, 1983. /s/ [ILLEGIBLE] ) /s/ G. Ralph Bartolme - ------------------------------------ --------------------------------------- Witness ) G. Ralph Bartolme SCHEDULE A IN THE MATTER OF the Business Corporations Act, 1982 and the Articles of Amalgamation of D-M-E OF CANADA LIMITED and CARDKEY SYSTEMS OF CANADA, LIMITED. I. G. RALPH BARTOLME, of the city of Laguna Niguel, in the State of California, do DECLARE THAT: 1. I am the Vice-President and Secretary of Cardkey Systems of Canada, Limited (hereinafter called the "Corporation") which is to be amalgamated with D-M-E of Canada Limited into an amalgamated corporation (hereinafter called the "Amalgamated Corporation") and as such have personal knowledge of the matters herein declared. 2. I have conducted such examinations of the books and records of the Corporation and have made such enquiries and investigations as are necessary to enable me to make this declaration. 3. I have satisfied myself that: (a) there are reasonable grounds for believing that the Corporation is and the Amalgamated Corporation will be able to pay its liabilities as they become due; (b) there are reasonable grounds for believing that the realizable value of the Amalgamated Corporation's assets will not be less than the aggregate of its liabilities and stated capital of all classes; and (c) there are reasonable grounds for believing that no creditor of the Corporation will be prejudiced by the amalgamation. DATED the 21st day of December, 1983. /s/ [ILLEGIBLE] ) /s/ G. Ralph Bartolme - ------------------------------------ --------------------------------------- Witness ) G. Ralph Bartolme SCHEDULE B CARDKEY SYSTEMS OF CANADA, LIMITED "AMALGAMATION WITH D-M-E OF CANADA LIMITED WHEREAS the Corporation and D-M-E of Canada Limited ("D-M-E") are wholly-owned subsidiaries of VSI Corporation; AND WHEREAS it is in the best interests of the Corporation that the Corporation and D-M-E amalgamate and continue as one corporation (the "Amalgamated Corporation") pursuant to subsection 176(2) of the Act without complying with sections 174 and 175 of the Act; NOW THEREFORE BE IT RESOLVED THAT 1. the amalgamation of the Corporation and D-M-E pursuant to subsection 176(2) of the Act, effective January 1. 1984, be and the same is hereby approved; 2. when the said amalgamation becomes effective, all the issued shares in the capital of the Corporation shall be cancelled without any repayment of capital in respect thereof; 3. except as may be prescribed, the articles of amalgamation shall be the same in substance as the articles of D-M-E; 4. the stated capital of the Corporation shall be added to the stated capital of D-M-E; and 5. any one of the directors or officers of the Corporation be and is hereby authorized and directed for and on behalf of the Corporation to do all acts and things and to execute under the seal of the Corporation or otherwise and to deliver all such documents and instruments as may be -2- necessary or desirable in connection with the said amalgamation including, without limitation, the filing of articles of amalgamation under the Act in the form of the draft articles of amalgamation annexed hereto as a schedule." The undersigned, being the Vice-President and Secretary of CARDKEY SYSTEMS OF CANADA, LIMITED (the "Corporation"), hereby certifies under the corporate seal of the Corporation that the foregoing is a true and complete copy of a resolution passed by the directors of the Corporation on December 21, 1983, which resolution remains in full force and effect, unamended. DATED the 21st day of December, 1983 /s/ G. R. Bartolme C.S. ----------------------------- G. R. Bartolme Schedule B D-M-E OF CANADA LIMITED "AMALGAMATION WITH CARDKEY SYSTEMS OF CANADA, LIMITED WHEREAS the Corporation and Cardkey Systems of Canada, Limited ("Cardkey") are wholly-owned subsidiaries of VSI Corporation; AND WHEREAS it is in the best interests of the Corporation that the Corporation and Cardkey amalgamate and continue as one corporation (the "Amalgamated Corporation") pursuant to subsection 176(2) of the Act without complying with sections 174 and 175 of the Act; NOW THEREFORE BE IT RESOLVED THAT 1. the amalgamation of the Corporation and Cardkey under the provisions of subsection 176(2) of the Act, effective January 1, 1984, be and the same is hereby approved; 2. when the said amalgamation becomes effective all the issued shares in the capital of Cardkey shall be cancelled without any payment of capital in respect thereof; 3. except as may be prescribed, the articles of amalgamation shall be the same in substance as the articles of the Corporation; 4. the stated capital of Cardkey shall be added to the stated capital of the Corporation; 5. any one of the directors or officers of the Corporation be and is hereby authorized and directed for and - 2 - on behalf of the Corporation to do all acts and things and to execute under the seal of the Corporation or otherwise and to deliver all such documents and instruments as may be necessary or desirable in connection with the said amalgamation including, without limitation, the filing of articles of amalgamation under the Act in the form of the draft articles of amalgamation annexed hereto as a schedule." The undersigned, being the Vice-President of D-M-E of Canada Limited (the "Corporation"), hereby certifies under the corporate seal of the Corporation that the foregoing is a true and complete copy of a resolution passed by the directors of the Corporation on December 21, 1983, which resolution remains in full force and effect, unamended. DATED the 21st day of December, 1983. /s/ G. R. Bartolme C.S. ----------------------------- G. R. Bartolme ARTICLES OF AMENDMENT For Ministry Use Only Ontario Corporation Number A l'usage exclusif du ministere Numero de la compagnie en Ontario [LOGO] Ministry of Ministere de 574439 Consumer and la Consommation Commercial et du Commerce Ontario Relations CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les presents Articles are effective on statuts entrent en vigueur le DECEMBER 5 DECEMBRE, 1989 /s/ [ILLEGIBLE] Director La Directeur TRANS Companies Branch Direction des compagnies CODE [C] - -------------------------------------------------------------------------------- ARTICLE OF AMENDMENT STATUTS OF MODIFICATION Form 3 1. The present name of the corporation is: Denomination sociale de la compagnie: Business Corporations D - M - E O F C A N A D A L I M I T E D Act 1982 2. The name of the corporation is changed to (if Nouvelle denomination sociale de la compagnie: (s'il y Formule applicable): a lieu): numero 3 Loi de 1982 ------------------------------------------------------------------------------------------------------ sur les ------------------------------------------------------------------------------------------------------ compagnies ------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------ 3. Date of incorporation/amalgamation: Date de la constitution ou de la fusion: 1/JANUARY/1984 --------------------------------------------------------------------------------------------------------- (Day, Month, Year) (jour, mois, annee) 4. The article of the corporation are amended as Les statuts de la compagnie sont modifies de la facon follows: suivante: (i) to provide that the corporation shall have a minimum of 1 and a maximum of 10 directors; (ii) to delete the maximum number of common shares of the corporation so that the corporation may issue an unlimited of common shares;

DYE & DURHAM FORM 3(B C A) 5. The amendment has been duly authorized La modification a ete dument as required by Sections 187 and 169 (as autorisee conformement a applicable) of the Business Corporations l'article 167 et, s'il y a lieu, a Act. l'article 169 de la Loi sur les compagnies. 6. The resolution authorizing the Les actionnaires ou les amendment was approved by the administrateurs (le cas echeant) de shareholders/directors (as applicable) la compagnie ont approuve la of the corporation on resolution autorisant la modification 05/DEC/89 ------------------------------------------------- (Day, Month, Year) (jour, mois, annee) These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. D-M-E OF CANADA LIMITED -------------------------------------- (Name of Corporation) (Denomination sociale de la compagnie) By/Par: [ILLEGIBLE] Secretary ----------------------------------------- [Signature] (Description of office) [Signature] (Fonction) EX-3.22 20 y98028exv3w22.txt BYLAWS EXHIBIT 3.22 D-M-E OF CANADA LIMITED BY-LAW NO. 1 A by-law relating generally to the conduct of the affairs of D-M-E OF CANADA LIMITED. BE IT ENACTED AND IT IS HEREBY ENACTED as a by-law of D-M-E OF CANADA LIMITED (hereinafter called the "Corporation") as follows: DEFINITIONS 1. In this by-law and all other by-laws of the Corporation, unless the context otherwise specifies or requires: (a) "Act" means the Business Corporations Act, 1982, S.O.1982, c. 4, as from time to time amended, and every statute that may be substituted therefor and, in the case of such amendment or substitution, any reference in the by-laws of the Corporation shall be read as referring to the amended or substituted provisions therefor; (b) "by-laws" means any by-law of the Corporation from time to time in force and effect; (c) all terms contained in the by-laws which are defined in the Act shall have the meanings given to such terms in the Act; (d) words importing the singular number only shall include the plural and vice-versa; words importing the masculine gender shall include the feminine and neuter genders; and (e) the headings used in the by-laws are inserted for reference purposes only and are not to be considered or taken into account in construing the terms or provisions thereof or to be deemed in any way to clarify, modify or explain the effect of any such terms or provisions. - 2 - REGISTERED OFFICE 2. The Corporation may from time to time (i) by resolution of the directors change the address of the registered office of the Corporation within the municipality or geographic township within Ontario specified in its articles, and (ii) by an amendment to its articles, change the municipality or geographic township within Ontario in which its registered office is situated. SEAL 3. The Corporation may, but need not, have a corporate seal. An instrument or agreement executed on behalf of the Corporation by a director, an officer or an agent of the Corporation is not invalid merely because the corporate seal, if any, is not affixed thereto. DIRECTORS 4. Number and powers. The number of directors of the Corporation is set out in the articles of the Corporation. A majority of the directors shall be resident Canadians. Subject to any unanimous shareholder agreement, the directors shall manage or supervise the management of the business and affairs of the Corporation and may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation and are not by the Act, the articles, the by-laws, any special resolution of the Corporation, a unanimous shareholder agreement or by statute expressly directed or required to be done in some other manner. Notwithstanding any vacancy among the directors the remaining directors may exercise all the powers of the board so long as a quorum of the board remains in office. Subject to subsections 124(1), (2), (4) and (5) of the Act and to the Corporation's articles, where there is a quorum of directors in office and a vacancy occurs, the directors remaining in office may appoint a qualified person to hold office for the unexpired term of his predecessor. 5. Duties. Every director and officer of the Corporation in exercising his powers and discharging his duties shall: - 3 - (a) act honestly and in good faith with a view to the best interests of the Corporation; and (b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. Every director and officer of the Corporation shall comply with the Act, the regulations thereunder, the Corporation's articles and by-laws and any unanimous shareholder agreement. 6. Qualification. Every director shall be an individual eighteen (18) or more years of age and no one who is of unsound mind and has been so found by a court in Canada or elsewhere or who has the status of a bankrupt shall be a director. 7. Term of office. A director's term of office (subject to the provisions, if any, of the Corporation's articles, and subject to his election for an expressly stated term) shall be from the date of the meeting at which he is elected or appointed until the close of the annual meeting of shareholders next following his election or appointment or until his successor is elected or appointed. 8. Vacation of office. The office of a director shall be vacated if: (a) he dies or, subject to subsection 119(2) of the Act, sends to the Corporation a written resignation and such resignation, if not effective upon receipt by the Corporation, becomes effective in accordance with its terms; (b) he is removed from office; (c) he becomes bankrupt; or (d) he is found by a court in Canada or elsewhere to be of unsound mind. 9. Election and removal. Directors shall be elected by the shareholders by ordinary resolution on a show of hands unless a poll is demanded and if a poll is demanded such election shall be by ballot. Except for those directors elected for an expressly stated term, all the directors then - 4 - in office shall cease to hold office at the close of the meeting of shareholders at which directors are to be elected but, if qualified, are eligible for re-election. Subject to subsection 122(2) of the Act, the shareholders of the Corporation may by ordinary resolution at an annual or special meeting remove any director before the expiration of his term of office and may, by a majority of the votes cast at the meeting, elect any person in his stead for the remainder of his term. Whenever at any election of directors of the Corporation the number or the minimum number of directors required by the articles is not elected by reason of the disqualification, incapacity or the death of any candidates, the directors elected at that meeting may exercise all the powers of the directors if the number of directors so elected constitutes a quorum pending the holding of a meeting of shareholders in accordance with subsection 124(3) of the Act. A retiring director shall cease to hold office at the close of the meeting at which his successor is elected unless such meeting was called for the purpose of removing him from office as a director in which case the director so removed shall vacate office forthwith upon the passing of the resolution for his removal. 10. Validity of acts. An act done by a director or by an officer is not invalid by reason only of any defect that is thereafter discovered in his appointment, election or qualification. MEETINGS OF DIRECTORS 11. Place of meeting. Meetings of directors and of any committee of directors may be held at any place within or outside Ontario and in any financial year a majority of the meetings of the board of directors need not be held at a place within Canada. A meeting of directors may be convened by the Chairman of the Board (if any), the President or any director at any time and the Secretary shall upon direction of any of the foregoing convene a meeting of directors. A quorum of the directors may, at any time, call a meeting of the directors for the transaction of any business the general nature of which is specified in the notice calling the meeting. 12. Notice. Notice of the time and place for the holding of any such meeting shall be sent to each director - 5 - not less than 2 days (exclusive of the day on which the notice is sent but inclusive of the day for which notice is given) before the date of the meeting; provided that meetings of the directors or of any committee of directors may be held at any time without formal notice if all the directors are present (except where a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called) or if all the absent directors have waived notice. Notice of the time and place for the holding of any meeting of directors or any committee of directors may be given by delivery, telegraph, cable, telex or other electronic means that produces a written copy. For the first meeting of directors to be held following the election of directors at an annual or special meeting of the shareholders or for a meeting of directors at which a director is appointed to fill a vacancy in the board, no notice of such meeting need be given to the newly elected or appointed director or directors in order for the meeting to be duly constituted, provided a quorum of the directors is present. 13. Waiver of notice. Notice of any meeting of directors or of any committee of directors or any irregularity in any meeting or in the notice thereof may be waived in any manner by any director and such waiver may be validly given either before or after the meeting to which such waiver relates. Attendance of a director at a meeting of directors is a waiver of notice of the meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called. 14. Telephone participation. Where all the directors of the Corporation present at or participating in the meeting consent thereto (either before or after the meeting), a director may participate in a meeting of directors or of any committee of directors by means of such telephone, electronic or other communications facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and a director participating in a meeting by such means shall be deemed for the purposes of the Act to be present at that meeting. If the majority of the directors participating in the meeting are then in Canada, the meeting shall be deemed to be held in Canada. - 6 - 15. Adjournment. Any meeting of directors or of any committee of directors may be adjourned from time to time by the chairman of the meeting, with the consent of the meeting, to a fixed time and place and no notice of the time and place for the holding of the adjourned meeting need be given to any director if the time and place of the adjourned meeting is announced at the original meeting. Any adjourned meeting shall be duly constituted if held in accordance with the terms of the adjournment and a quorum is present thereat. The directors who formed a quorum at the original meeting are not required to form the quorum at the adjourned meeting. If there is no quorum present at the adjourned meeting, the original meeting shall be deemed to have terminated forthwith after its adjournment. 16. Quorum and voting. A majority of the number of directors or minimum number of directors required by the articles shall constitute a quorum for the transaction of business. Subject to subsection 124(1) and subsection 126(7) of the Act, no business shall be transacted by the directors except at a meeting of directors at which a quorum is present and at which a majority of the directors present are resident Canadians. Questions arising at any meeting of directors shall be decided by a majority of votes. In case of an equality of votes, the chairman of the meeting in addition to his original vote shall have a second or casting vote. COMMITTEES OF DIRECTORS 17. General. The directors may from time to time appoint from their number a committee of directors, a majority of whom shall be resident Canadians, and may delegate to such committee any of the powers of the directors, except that no such committee shall have the authority to: (a) submit to the shareholders any question or matter requiring the approval of the shareholders; (b) fill a vacancy among the directors or in the office of auditor or appoint or remove any of the chief executive officer, however designated, the chief financial officer, however designated, the chairman or the president of the Corporation; (c) subject to section 183 of the Act, issue securities except in the manner and on the terms authorized by the directors; - 7 - (d) declare dividends; (e) purchase, redeem or otherwise acquire shares issued by the Corporation; (f) pay a commission referred to in section 37 of the Act; (g) approve a management information circular referred to in Part VIII of the Act; (h) approve a take-over bid circular, directors' circular, or issuer bid circular referred to in Part XIX of the Securities Act; (i) approve any financial statements referred to in clause 153(1)(b) of the Act and Part XVII of the Securities Act; or (j) adopt, amend or repeal by-laws. 18. Audit Committee. If the Corporation is an "offering corporation" as defined in paragraph 1(1)27 of the Act, the board of directors shall, and otherwise the directors may, elect annually from among their number an audit committee to be composed of not fewer than 3 directors, a majority of whom are not officers or employees of the Corporation or any of its affiliates to hold office until the next annual meeting of the shareholders. Each member of the audit committee shall serve during the pleasure of the board of directors and, in any event, only so long as he shall be a director. The directors may fill vacancies in the audit committee by election from among their number. The audit committee shall have power to fix its quorum at not less than a majority of its members and to determine its own rules of procedure subject to any regulations imposed by the board of directors from time to time and to the following paragraph. The auditor of the Corporation is entitled to receive notice of every meeting of the audit committee and, at the expense of the Corporation, to attend and be heard thereat; and, if so requested by a member of the audit committee, shall attend every meeting of the committee held - 8 - during the term of office of the auditor. The auditor of the Corporation or any member of the audit committee may call a meeting of the committee. The audit committee shall review the financial statements of the Corporation and shall report thereon to the board of directors of the Corporation prior to approval thereof by the board of directors and shall have such other powers and duties as may from time to time by resolution be assigned to it by the board. REMUNERATION OF DIRECTORS, OFFICERS AND EMPLOYEES 19. The remuneration to be paid to the directors of the Corporation shall be such as the directors shall from time to time by resolution determine and such remuneration shall be in addition to the salary paid to any officer or employee of the Corporation who is also a director. The directors may also by resolution award special remuneration to any director in undertaking any special services on the Corporation's behalf other than the normal work ordinarily required of a director of a corporation. The confirmation of any such resolution or resolutions by the shareholders shall not be required. The directors may fix the remuneration of the officers and employees of the Corporation. The directors, officers and employees shall also be entitled to be paid their travelling and other expenses properly incurred by them in connection with the affairs of the Corporation. SUBMISSION OF CONTRACTS OR TRANSACTIONS TO SHAREHOLDERS FOR APPROVAL 20. The directors in their discretion may submit any contract, act or transaction for approval, ratification or confirmation at any meeting of the shareholders called for the purpose of considering the same and any contract, act or transaction that shall be approved, ratified or confirmed by resolution passed by a majority of the votes cast at any such meeting (unless any different or additional requirement is imposed by the Act or by the Corporation's articles or by-laws) shall be as valid and as binding upon the Corporation and upon all the shareholders as though it had been approved, ratified and/or confirmed by every shareholder of the Corporation. - 9 - FOR THE PROTECTION OF DIRECTORS AND OFFICERS 21. No director or officer for the time being of the Corporation shall be liable for the acts, receipts, neglects or defaults of any other director or officer or employee or for joining in any receipt or act for conformity or for any loss, damage or expense suffered or incurred by the Corporation through the insufficiency or deficiency of title to any property acquired by the Corporation or for or on behalf of the Corporation or for the insufficiency or deficiency of any security in or upon which any of the moneys of or belonging to the Corporation shall be placed out or invested or for any loss or damage arising from the bankruptcy, insolvency or tortious act of any person, firm or corporation including any person, firm or corporation with whom or which any moneys, securities or effects shall be lodged or deposited or for any loss, conversion, misapplication or misappropriation of or any damage resulting from any dealings with any moneys, securities or other assets belonging to the Corporation or for any other loss, damage or misfortune whatever which may happen in the execution of the duties of his respective office of trust or in relation thereto, unless the same shall happen by or through his failure to exercise the powers and to discharge the duties of his office honestly and in good faith with a view to the best interests of the Corporation, and in connection therewith to exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances, provided that nothing herein contained shall relieve a director or officer from the duty to act in accordance with the Act or regulations made thereunder or relieve him from liability for a breach thereof. The directors for the time being of the Corporation shall not be under any duty or responsibility in respect of any contract, act or transaction whether or not made, done or entered into in the name or on behalf of the Corporation, except such as shall have been submitted to and authorized or approved by the board of directors. If any director or officer of the Corporation shall be employed by or shall perform services for the Corporation otherwise than as a director or officer or shall be a member of a firm or a shareholder, director or officer of a body corporate which is employed by or performs services for the Corporation, the fact of his being a shareholder, director or officer of the Corporation shall not disentitle such director or officer or such firm or body corporate, as the case may be, from receiving proper remuneration for such services. - 10 - INDEMNITIES TO DIRECTORS AND OTHERS 22. Subject to subsections 136(2) and (3) of the Act, the Corporation shall indemnify a director or officer of the Corporation, a former director or officer of the Corporation or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor, and his heirs and legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of such corporation or body corporate, if (a) he acted honestly and in good faith with a view to the best interests of the Corporation; and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful. The Corporation is hereby authorized to execute agreements evidencing its indemnity in favour of the foregoing persons to the full extent permitted by law. OFFICERS 23. Appointment of officers. The directors shall annually or as often as may be required appoint a President and a Secretary and if deemed advisable may annually or as often as may be required appoint a Chairman of the Board, one or more Vice-Presidents, a Treasurer and one or more Assistant Secretaries and/or one or more Assistant Treasurers. None of such officers, except the Chairman of the Board, need be a director of the Corporation. Any director may be appointed to any office of the Corporation. Two or more of such offices may be held by the same person. In case and whenever the same person holds the offices of Secretary and Treasurer he may but need not be known as the Secretary-Treasurer. The directors may from time to time appoint such other officers, employees and agents as they shall deem necessary who shall have such authority and shall perform such functions and duties as may from time to time be prescribed by resolution of the directors. - 11 - 24. Removal of officers, etc. All officers, employees and agents, in the absence of agreement to the contrary, shall be subject to removal by resolution of the directors at any time, with or without cause. 25. Duties of officers may be delegated. In case of the absence or inability or refusal to act of any officer of the Corporation or for any other reason that the directors may deem sufficient, the directors may delegate all or any of the powers of such officer to any other officer or to any director for the time being. 26. Chairman of the Board. The Chairman of the Board (if any), shall when present preside at all meetings of the directors, any committee of the directors and shareholders, shall sign such documents as may require his signature in accordance with the by-laws of the Corporation and shall have such other powers and shall perform such other duties as may from time to time be assigned to him by resolution of the directors or as are incident to his office. 27. President. The President shall be the chief executive officer of the Corporation and shall exercise general supervision over the business and affairs of the Corporation. In the absence of the Chairman of the Board (if any), and if the President is also a director of the Corporation, the President shall, when present, preside at all meetings of the directors, any committee of the directors and shareholders; he shall sign such contracts, documents or instruments in writing as require his signature and shall have such other powers and shall perform such other duties as may from time to time be assigned to him by resolution of the directors or as are incident to his office. 28. Vice-President. The Vice-President or, if more than one, the Vice-Presidents in order of seniority, shall be vested with all the powers and shall perform all the duties of the President in the absence or inability or refusal to act of the President, provided, however, that a Vice-President who is not a director shall not preside as chairman at any meeting of directors or shareholders. The Vice-President or, if more than one, the Vice-Presidents in order of seniority, shall sign such contracts, documents or instruments in writing as require his or their signatures and shall also have such other powers and duties as may from time to time be assigned to him or them by resolution of the directors. - 12 - 29. Secretary. The Secretary shall give or cause to be given notices for all meetings of the directors, any committee of the directors and shareholders when directed to do so and shall have charge of the minute books of the Corporation and, subject to the provisions of paragraph 45 hereof, of the documents and registers referred to in subsections 140(1) and (2) of the Act. He shall sign such contracts, documents or instruments in writing as require his signature and shall have such other powers and duties as may from time to time be assigned to him by resolution of the directors or as are incident to his office. 30. Treasurer. Subject to the provisions of any resolution of the directors, the Treasurer shall have the care and custody of all the funds and securities of the Corporation and shall deposit the same in the name of the Corporation in such bank or banks or with such other depositary or depositaries as the directors may by resolution direct. He shall prepare and maintain adequate accounting records. He shall sign such contracts, documents or instruments in writing as require his signature and shall have such other powers and duties as may from time to time be assigned to him by resolution of the directors or as are incident to his office. He may be required to give such bond for the faithful performance of his duties as the directors in their uncontrolled discretion may require and no director shall be liable for failure to require any such bond or for the insufficiency of any such bond or for any loss by reason of the failure of the Corporation to receive any indemnity thereby provided. 31. Assistant Secretary and Assistant Treasurer. The Assistant Secretary or, if more than one, the Assistant Secretaries in order of seniority, and the Assistant Treasurer or, if more than one, the Assistant Treasurers in order of seniority, shall perform all the duties of the Secretary and Treasurer, respectively, in the absence or inability to act of the Secretary or Treasurer as the case may be. The Assistant Secretary or Assistant Secretaries, if more than one, and the Assistant Treasurer or Assistant Treasurers, if more than one, shall sign such contracts, documents or instruments in writing as require his or their signatures respectively and shall have such other powers and duties as may from time to time be assigned to them by resolution of the directors. 32. Managing Director. The directors may from time to time appoint from their number a Managing Director who is a - 13 - resident Canadian and may delegate to the Managing Director any of the powers of the directors subject to the limits on authority provided by subsection 127(3) of the Act. A Managing Director shall conform to all lawful orders given to him by the directors of the Corporation and shall at all reasonable times give to the directors or any of them all information they may require regarding the affairs of the Corporation. Any agent or employee appointed by a Managing Director shall be subject to discharge by the directors. 33. Vacancies. If the office of Chairman of the Board, President, Vice-President, Secretary, Assistant Secretary, Treasurer, Assistant Treasurer, or any other office created by the directors pursuant to paragraph 23 hereof shall be or become vacant by reason of death, resignation or in any other manner whatsoever, the directors shall in the case of the President or the Secretary and may in the case of the other officers appoint an officer to fill such vacancy. SHAREHOLDERS' MEETINGS 34. Annual or special meetings. Subject to subsection 104(1) of the Act, the directors of the Corporation, (a) shall call an annual meeting of shareholders not later than eighteen months after the Corporation comes into existence and subsequently not later than fifteen months after holding the last preceding annual meeting; and (b) may at any time call a special meeting of shareholders. 35. Place of meetings. Subject to the articles and any unanimous shareholder agreement, a meeting of the shareholders of the Corporation may be held at such place in or outside Ontario as the directors may determine or, in the absence of such a determination, at the place where the registered office of the Corporation is located. 36. Notice. A notice stating the day, hour and place of meeting and, if special business is to be transacted thereat, stating (or accompanied by a statement of) (i) the nature of that business in sufficient detail to permit the shareholder to form a reasoned judgment thereon, and (ii) the text of any special resolution or by-law to be submitted to the meeting, shall be served by sending such notice to - 14 - each person who is entitled to notice of such meeting and who on the record date for notice appears on the records of the Corporation or its transfer agent as a shareholder entitled to vote at the meeting and to each director of the Corporation and to the auditor of the Corporation by prepaid mail not less than 21 days and not more than 50 days (exclusive of the day of mailing and of the day for which notice is given) before the date (if the Corporation is an offering corporation as such term is defined in the Act) or not less than 10 days before the date (if the Corporation is not an offering corporation) of every meeting addressed to the latest address of each such person as shown in the records of the Corporation or its transfer agent, or if no address is shown therein, then to the last address of each such person known to the Secretary; provided that a meeting of shareholders may be held for any purpose at any date and time and at any place without notice if all the shareholders and other persons entitled to notice of such meeting are present in person or represented by proxy at the meeting (except where the shareholder or such other person attends the meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called) or if all the shareholders and other persons entitled to notice of such meeting and not present in person nor represented by proxy thereat waive notice of the meeting. Notice of any meeting of shareholders or the time for the giving of any such notice or any irregularity in any such meeting or in the notice thereof may be waived in any manner by any shareholder, the duly appointed proxy of any shareholder, any director or the auditor of the Corporation and any other person entitled to attend a meeting of shareholders, and any such waiver may be validly given either before or after the meeting to which such waiver relates. The auditor of the Corporation is entitled to attend any meeting of shareholders of the Corporation and to receive all notices and other communications relating to any such meeting that a shareholder is entitled to receive. 37. Omission of notice. The accidental omission to give notice of any meeting to or the non-receipt of any notice by any person shall not invalidate any resolution passed or any proceeding taken at any meeting of shareholders. 38. Record dates for notice of meetings. Subject to subsection 95(4) of the Act, the directors may also fix in advance the date as the record date for the determination of - 15 - shareholders entitled to receive notice of a meeting of shareholders, but such record date shall not precede by more than 50 days or by less than 21 days the date on which the meeting is to be held. If no record date is fixed, the record date for the determination of the shareholders entitled to receive notice of a meeting of the shareholders shall be (i) at the close of business on the day immediately preceding the day on which notice is given; or (ii) if no notice is given, the day on which the meeting is held. 39. Votes. Every question submitted to any meeting of shareholders shall be decided in the first instance on a show of hands and in case of an equality of votes the chairman of the meeting shall both on a show of hands and at a poll have a second or casting vote in addition to the vote or votes to which he may be entitled as a shareholder or proxy nominee. At any meeting, unless a poll is demanded by a shareholder or proxyholder entitled to vote at the meeting, either before or after any vote by a show of hands, a declaration by the Chairman of the meeting that a resolution has been carried or carried unanimously or by a particular majority or lost or not carried by a particular majority shall be evidence of the fact without proof of the number or proportion of votes recorded in favour of or against the motion. In the absence of the Chairman of the Board (if any), the President and any Vice-President who is a director, the shareholders present entitled to vote shall choose another director as chairman of the meeting and if no director is present or if all the directors present decline to take the chair then the shareholders present shall choose one of their number to be chairman. If at any meeting a poll is demanded on the election of a chairman or on the question of adjournment or termination, the poll shall be taken forthwith without adjournment. If a poll is demanded on any other question or as to the election of directors, the poll shall be taken by ballot in such manner and either at once or later at the meeting or after adjournment as the chairman of the meeting - 16 - directs. The result of a poll shall be deemed to be the resolution of the meeting at which the poll was demanded. A demand for a poll may be made either before or after any vote by show of hands and may be withdrawn. Where two or more persons hold the same share or shares jointly, any one of such persons present at a meeting of shareholders has the right, in the absence of the other or others, to vote in respect of such share or shares, but if more than one of such persons are present or represented by proxy and vote, they shall vote together as one on the share or shares jointly held by them. 40. Proxies. Votes at meetings of the shareholders may be given either personally or by proxy. At every meeting at which he is entitled to vote, every shareholder present in person and every proxyholder shall have one (1) vote on a show of hands. Upon a poll at which he is entitled to vote every shareholder present in person or by proxy shall (subject to the provisions, if any, of the Corporation's articles) have one (1) vote for every share registered in his name. Every shareholder, including a shareholder that is a body corporate, entitled to vote at a meeting of shareholders may by means of a proxy appoint a proxyholder or proxyholders or one or more alternate proxyholders, who need not be shareholders, as his nominee to attend and act at the meeting in the manner, to the extent and with the authority conferred by the proxy. A proxy shall be executed by the shareholder or his attorney authorized in writing or, if the shareholder is a body corporate, by an officer or attorney thereof duly authorized. If the Corporation is an "offering corporation" as defined in paragraph 1(1)27 of the Act, any such proxy appointing a proxyholder to attend and act at a meeting or meetings of shareholders ceases to be valid one year from its date. An instrument appointing a proxyholder may be in the following form or in any other form which complies with the regulations made under the Act: - 17 - "The undersigned shareholder of D-M-E OF CANADA LIMITED hereby appoints of , whom failing, of as the nominee of the undersigned to attend and act for and on behalf of the undersigned at the meeting of the shareholders of the said Corporation to be held on the day of , 19 and at any adjournment thereof in the same manner, to the same extent and with the same power as if the undersigned were personally present at the said meeting or such adjournment thereof. Dated the day of , 19 . /s/ Cyrus McGrath --------------------------- /s/ Jerry Lirette --------------------------- Signature of Shareholder This form of proxy must be signed by a shareholder or his attorney authorized in writing or, if the shareholder is a body corporate, by an officer or attorney thereof duly authorized." The directors may from time to time pass regulations regarding the lodging of instruments appointing a proxyholder at some place or places other than the place at which a meeting or adjourned meeting of shareholders is to be held and for particulars of such instruments to be telegraphed, cabled, telexed, sent in writing or otherwise communicated by electronic means that produces a written copy before the meeting or adjourned meeting to the Corporation or any agent of the Corporation appointed for the purpose of receiving such particulars and providing that instruments appointing a proxyholder so lodged may be voted upon as though the instruments themselves were produced at the meeting or adjourned meeting and votes given in accordance with such regulations shall be valid and shall be counted. The chairman of the meeting of shareholders may, subject to any regulations made as aforesaid, in his discretion accept telegraphic, telex, cable or written communication, or electronic communication that produces a written copy, as to the authority of anyone claiming to vote on behalf of and to represent a shareholder notwithstanding - 18 - that no instrument of proxy conferring such authority has been lodged with the Corporation, and any votes given in accordance with such telegraphic, telex, cable, written or electronic communication accepted by the chairman of the meeting shall be valid and shall be counted. 41. Adjournment. The chairman of the meeting may with the consent of the meeting adjourn any meeting of shareholders from time to time to a fixed time and place and if the meeting is adjourned for less than thirty (30) days no notice of the time and place for the holding of the adjourned meeting need be given to any shareholder, other than by announcement at the earliest meeting that is adjourned. If a meeting of shareholders is adjourned by one or more adjournments for an aggregate of thirty (30) days or more, notice of the adjourned meeting shall be given as for an original meeting but, unless the meeting is adjourned by one or more adjournments for an aggregate of more than ninety (90) days, section 111 of the Act does not apply. Any adjourned meeting shall be duly constituted if held in accordance with the terms of the adjournment and a quorum is present thereat. The persons who formed a quorum at the original meeting are not required to form the quorum at the adjourned meeting. If there is no quorum present at the adjourned meeting, the original meeting shall be deemed to have terminated forthwith after its adjournment. Any business may be brought before or dealt with at any adjourned meeting which might have been brought before or dealt with at the original meeting in accordance with the notice calling the same. 42. Quorum. Two (2) persons present and each holding or representing by proxy at least one (1) issued share of the Corporation shall be a quorum of any meeting of shareholders for the choice of a chairman of the meeting and for the adjournment of the meeting to a fixed time and place but may not transact any other business; for all other purposes a quorum for any meeting shall be persons present not being less than two (2) in number and holding or representing by proxy not less than a majority of the total number of the issued shares of the Corporation for the time being enjoying voting rights at such meeting. If a quorum is present at the opening of a meeting of shareholders, the shareholders present may proceed with the business of the meeting, notwithstanding that a quorum is not present throughout the meeting. - 19 - Notwithstanding the foregoing, if the Corporation has only one shareholder, or only one shareholder of any class or series of shares, the shareholder present in person or by proxy constitutes a meeting and a quorum for such meeting. SHARES AND TRANSFERS 43. Issuance. Subject to the articles of the Corporation and any unanimous shareholder agreement, shares in the Corporation may be issued at such time and issued to such persons and for such consideration as the directors may determine. 44. Security certificates. Security certificates (and the form of transfer power on the reverse side thereof) shall (subject to compliance with section 56 of the Act) be in such form as the directors may from time to time by resolution approve and, subject to subsection 55(3) of the Act, such certificates shall be signed manually by at least one director or officer of the Corporation or by or on behalf of a registrar, transfer agent, branch transfer agent or issuing or other authenticating agent of the Corporation, or by a trustee who certifies it in accordance with a trust indenture, and any additional signatures required on a security certificate may be printed or otherwise mechanically reproduced thereon. Notwithstanding any change in the persons holding an office between the time of actual signing and the issuance of any certificate and notwithstanding that a person signing may not have held office at the date of issuance of such certificate, any such certificate so signed shall be valid and binding upon the Corporation. 45. Transfer agents. For each class of securities and warrants issued by the Corporation, the directors may from time to time by resolution appoint or remove, (a) a trustee, transfer agent or other agent to keep the securities register and the register of transfer and one or more persons or agents to keep branch registers; and (b) a registrar, trustee or agent to maintain a record of issued security certificates and warrants, and subject to section 48 of the Act, one person may be appointed for the purposes of both clauses (a) and (b) in - 20 - respect of all securities and warrants of the Corporation or any class or classes thereof. 46. Surrender of security certificates. Subject to the Act, no transfer of a security issued by the Corporation shall be recorded or registered unless and until (i) the security certificate representing the security to be transferred has been surrendered and cancelled or (ii) if no security certificate has been issued by the Corporation in respect of such share, a duly executed security transfer power in respect thereof has been presented for registration. 47. Defaced, destroyed, stolen or lost security certificates. In case of the defacement, destruction, theft or loss of a security certificate, the fact of such defacement, destruction, theft or loss shall be reported by the owner to the Corporation or to an agent of the Corporation (if any) acting on behalf of the Corporation, with a statement verified by oath or statutory declaration as to the defacement, destruction, theft or loss and the circumstances concerning the same and with a request for the issuance of a new security certificate to replace the one so defaced, destroyed, stolen or lost. Upon the giving to the Corporation (or, if there be an agent, hereinafter in this paragraph referred to as the "Corporation's agent", then to the Corporation and the Corporation's agent) of an indemnity bond of a surety company in such form as is approved by the directors or by the Chairman of the Board (if any), the President, a Vice-President, the Secretary or the Treasurer of the Corporation, indemnifying the Corporation (and the Corporation's agent if any) against all loss, damage and expense, which the Corporation and/or the Corporation's agent may suffer or be liable for by reason of the issuance of a new security certificate to such shareholder, and provided the Corporation or the Corporation's agent does not have notice that the security has been acquired by a bona fide purchaser, a new security certificate may be issued in replacement of the one defaced, destroyed, stolen or lost, if such issuance is ordered and authorized by any one of the Chairman of the Board (if any), the President, a Vice-President, the Secretary or the Treasurer of the Corporation or by resolution of the directors. DIVIDENDS 48. The directors may from time to time by resolution declare and the Corporation may pay dividends on its issued - 21 - shares, subject to the provisions (if any) of the Corporation's articles. The directors shall not declare and the Corporation shall not pay a dividend if there are reasonable grounds for believing that: (a) the Corporation is, or, after the payment, would be unable to pay its liabilities as they become due; or (b) the realizable value of the Corporation's assets would thereby be less than the aggregate of its liabilities and stated capital of all classes. The directors may declare and the Corporation may pay a dividend by issuing fully paid shares of the Corporation or options or rights to acquire fully paid shares of the Corporation and, subject to section 38 of the Act, the Corporation may pay a dividend in money or property. 49. In case several persons are registered as the joint holders of any securities of the Corporation, any one of such persons may give effectual receipts for all dividends and payments on account of dividends, principal, interest and/or redemption payments on redemption of securities (if any) subject to redemption in respect of such securities. RECORD DATES 50. Subject to subsection 95(4) of the Act, the directors may fix in advance a date as the record date for the determination of shareholders (i) entitled to receive payment of a dividend, (ii) entitled to participate in a liquidation or distribution, or (iii) for any other purpose except the right to receive notice of or to vote at a meeting of shareholders, but such record date shall not precede by more than 50 days the particular action to be taken. If no record is fixed, the record date for the determination of shareholders for any purpose, other than to establish a record date for the determination of shareholders entitled to receive notice of a meeting of shareholders or to vote, shall be the close of business on the day on which the directors pass the resolution relating thereto. - 22 - VOTING SECURITIES IN OTHER ISSUERS 51. All securities of any other body corporate or issuer of securities carrying voting rights held from time to time by the Corporation may be voted at all meetings of shareholders, bondholders, debenture holders or holders of such securities, as the case may be, of such other body corporate or issuer and in such manner and by such person or persons as the directors of the Corporation shall from time to time determine and authorize by resolution. The duly authorized signing officers of the Corporation may also from time to time execute and deliver for and on behalf of the Corporation proxies and/or arrange for the issuance of voting certificates and/or other evidence of the right to vote in such names as they may determine without the necessity of a resolution or other action by the directors. NOTICES, ETC. 52. Service. Any notice or other document required to be given or sent by the Corporation to any shareholder or director of the Corporation shall be delivered personally or sent by prepaid mail or by telegram, telex or other electronic means that produces a written copy addressed to: (a) the shareholder at his latest address as shown on the records of the Corporation or its transfer agent; and (b) the director at his latest address as shown in the records of the Corporation or in the last notice filed under the Corporations Information Act, whichever is the more current. With respect to every notice or other document sent by prepaid mail it shall be sufficient to prove that the envelope or wrapper containing the notice or other document was properly addressed and put into a post office or into a post office letter box and shall be deemed to be received by the addressee on the fifth day after mailing. 53. If the Corporation sends a notice or document to a shareholder and the notice or document is returned on three consecutive occasions because the shareholder cannot be found, the Corporation is not required to send any further notices or documents to the shareholder until he informs the Corporation in writing of his new address. - 23 - 54. Shares registered in more than one name. All notices or other documents shall, with respect to any shares in the capital of the Corporation registered in more than one name, be given to whichever of such persons is named first in the records of the Corporation and any notice or other document so given shall be sufficient notice or delivery of such document to all the holders of such shares. 55. Persons becoming entitled by operation of law. Every person who by operation of law, transfer or by any other means whatsoever shall become entitled to any shares in the capital of the Corporation shall be bound by every notice or other document in respect of such shares which prior to his name and address being entered on the records of the Corporation shall have been duly given to the person or persons from whom he derives his title to such shares. 56. Deceased shareholder. Any notice or other document delivered or sent by post or left at the address of any shareholder as the same appears in the records of the Corporation shall, notwithstanding that such shareholder be then deceased and whether or not the Corporation has notice of his decease, be deemed to have been duly served in respect of the shares held by such shareholder (whether held solely or with other persons) until some other person be entered in his stead in the records of the Corporation as the holder or one of the holders thereof and such service shall for all purposes be deemed a sufficient service of such notice or other document on his heirs, executors or administrators and all persons (if any) interested with him in such shares. 57. Signatures to notices. The signature of any director or officer of the Corporation to any notice may be written, printed or otherwise mechanically reproduced. 58. Computation of time. Where a given number of days' notice or notice extending over any period is required to be given under any provisions of the articles or by-laws of the Corporation, the day of service, posting or other communication of the notice shall not be counted in such number of days or other period, and such number of days or other period shall commence on the day following the day of service, posting or other communication of the notice and shall terminate at midnight of the last day of the period except that if the last day of the period falls on a Sunday - 24 - or holiday the period shall terminate at midnight of the day next following that is not a Sunday or holiday. 59. Proof of service. A certificate of any officer of the Corporation in office at the time of the making of the certificate or of an agent of the Corporation as to facts in relation to the mailing or delivery or service of any notice or other documents to any shareholder, director, officer or auditor or publication of any notice or other document shall be conclusive evidence thereof and shall be binding on every shareholder, director, officer or auditor of the Corporation, as the case may be. CHEQUES, DRAFTS, NOTES, ETC. 60. All cheques, drafts or orders for the payment of money and all notes, acceptances and bills of exchange shall be signed by such officer or officers or other person or persons, whether or not officers of the Corporation, and in such manner as the directors may from time to time designate by resolution. CUSTODY OF SECURITIES 61. All securities (including warrants) owned by the Corporation shall be lodged (in the name of the Corporation) with a chartered bank or a trust company or in a safety deposit box or, if so authorized by resolution of the directors, with such other depositaries or in such other manner as may be determined from time to time by the directors. All securities (including warrants) belonging to the Corporation may be issued and held in the name of a nominee or nominees of the Corporation (and if issued or held in the names of more than one nominee shall be held in the names of the nominees jointly with right of survivorship) and shall be endorsed in blank with endorsement guaranteed in order to enable transfer thereof to be completed and registration thereof to be effected. EXECUTION OF CONTRACTS, ETC. 62. Contracts, documents or instruments in writing requiring the signature of the Corporation may be signed by any two officers and all contracts, documents or instruments in writing so signed shall be binding upon the Corporation without any further authorization or formality. The - 25 - directors are authorized from time to time by resolution to appoint any officer or officers or any other person or persons on behalf of the Corporation either to sign contracts, documents or instruments in writing generally or to sign specific contracts, documents or instruments in writing. The corporate seal of the Corporation may, when required, be affixed to contracts, documents or instruments in writing signed as aforesaid or by an officer or officers, person or persons appointed as aforesaid by resolution of the board of directors. The term "contracts, documents or instruments in writing" as used in this by-law shall include deeds, mortgages, hypothecs, charges, conveyances, transfers and assignments of property, real or personal, immovable or movable, powers of attorney, agreements, releases, receipts and discharges for the payment of money or other obligations, conveyances, transfers and assignments of securities and all paper writings. In particular, without limiting the generality of the foregoing, any two officers are authorized to sell, assign, transfer, exchange, convert or convey all securities owned by or registered in the name of the Corporation and to sign and execute (under the seal of the Corporation or otherwise) all assignments, transfers, conveyances, powers of attorney and other instruments that may be necessary for the purpose of selling, assigning, transferring, exchanging, converting or conveying any such securities. The signature or signatures of any such officer or director of the Corporation and/or of any other officer or officers, person or persons appointed as aforesaid by resolution of the directors may, if specifically authorized by resolution of the directors, be printed, engraved, lithographed or otherwise mechanically reproduced upon all contracts, documents or instruments in writing or bonds, debentures or other securities of the Corporation executed or issued by or on behalf of the Corporation and all contracts, documents or instruments in writing or securities of the Corporation on which the signature or signatures of any of the foregoing officers, directors or persons shall be so reproduced, by authorization by resolution of the directors, shall be deemed to have been manually signed by such officers, directors or persons whose signature or signatures is or are so reproduced and shall be as valid to all intents and purposes as if they had been signed manually - 26 - and notwithstanding that the officers, directors or persons whose signature or signatures is or are so reproduced may have ceased to hold office at the date of the delivery or issue of such contracts, documents or instruments in writing or securities of the Corporation. ENFORCEMENT OF LIEN FOR INDEBTEDNESS 63. Unless the Corporation has shares listed on a stock exchange recognized by the Ontario Securities Commission, the Corporation has a lien on shares registered in the name of a shareholder or his legal representative for a debt of that shareholder to the Corporation. The directors of the Corporation may authorize the Corporation to apply any dividends or other distributions paid or payable on or in respect of the share or shares in respect of which the Corporation has such a lien in repayment of the debt of that shareholder to the Corporation. FINANCIAL YEAR 64. The financial year of the Corporation shall terminate on such day in each year as the board of directors may from time to time by resolution determine. ENACTED the 4th day of January , 1984. WITNESS the corporate seal of the Corporation. /s/ Jerry R. Lirette /s/ Cyrus McGrath - ---------------------- C.S. ----------------------- President Secretary The undersigned, being all the directors of D-M-E OF CANADA LIMITED, pursuant to subsection 129(1) of the Business Corporations Act, 1982, by their signatures hereby make the foregoing By-law No. 1 of the by-laws of the said Corporation. DATED the 4th day of January , 1984. /s/ Jerry R. Lirette /s/ Cyrus McGrath - ----------------------- ------------------------- Jerry R. Lirette Cyrus McGrath /s/ Orey Fidani /s/ David W. Smith - -------------------- ------------------------- Orey Fidani David W. Smith - 27 - The undersigned, being the sole shareholder of D-M-E OF CANADA LIMITED, pursuant to subsection 104(1) of the Business Corporations Act, 1982, by its signature hereby confirms without amendment the foregoing By-law No. 1 of the by-laws of the said Corporation made by the directors of the said Corporation. DATED the 4th day of January, 1984. VSI CORPORATION by /s/ Jerry Lirette -------------------------- /s/ Cyrus McGrath C.S. -------------------------- D-M-E OF CANADA LIMITED THE ROYAL BANK OF CANADA BY-LAW NO. 2 A by-law respecting the borrowing of money and the issue of securities by D-M-E OF CANADA LIMITED. BE IT ENACTED as a By-Law of the Corporation as follows: The Directors of the Corporation are hereby authorized from time to time (a) to borrow money upon the credit of the Corporation in such amounts and on such terms as may be deemed expedient by obtaining loans or advances or by way of overdraft or otherwise; (b) to issue or reissue debt obligations of the Corporation; (c) to pledge or sell such debt obligations for such sums and at such prices as may be deemed expedient; (d) to mortgage, charge, hypothecate, pledge or otherwise create a security interest in all or any property real and personal, immoveable and moveable, undertaking and rights of the Corporation, owned or subsequently acquired, to secure any debt obligations of the Corporation present or future or any money borrowed or to be borrowed or any other debt or liability of the Corporation present or future; (e) to delegate to such officer(s), Director(s) or committee of Directors of the Corporation as the Directors may designate all or any of the foregoing powers to such extent and such manner as the Directors may determine. This By-law shall remain in force and be binding upon the Corporation as regards any party acting on the faith thereof until a copy, certified by the Secretary of the Corporation, of a By-law repealing or replacing this - 2 - By-law shall have been received by such party and duly acknowledged in writing. ENACTED this 4th day of January , 1984. AS WITNESS the corporate seal of the Corporation. /s/ Jerry R. Lirette /s/ Cyrus McGrath - -------------------------------------- C.S. ------------------------------------ President Secretary The undersigned, being all the directors of D-M-E OF CANADA LIMITED, pursuant to subsection 129(1) of the Business Corporations Act, 1982, by their signatures hereby make the foregoing By-law No. 1 of the by-laws of the said Corporation. DATED the 4th day of January , 1984. /s/ Jerry R. Lirette /s/ Cyrus McGrath - ------------------------------ ------------------------------ Jerry R. Lirette Cyrus McGrath /s/ Orey Fidani /s/ David W. Smith - ------------------------------ ------------------------------ Orey Fidani David W. Smith The undersigned, being the sole shareholder of D-M-E OF CANADA LIMITED, pursuant to subsection 104(1) of the Business Corporations Act, 1982, by its signature hereby confirms without amendment the foregoing By-law No. 1 of the by-laws of the said Corporation made by the directors of the said Corporation. DATED the 4th day of January , 1984. VSI CORPORATION by /s/ Jerry R. Lirette --------------------------- /s/ Cyrus McGrath --------------------------- C.S. EX-3.23 21 y98028exv3w23.txt LETTERS PATENT EXHIBIT 3.23 PROVINCE OF ONTARIO BY THE HONOURABLE [ILLEGIBLE] PROVINCIAL SECRETARY AND MINISTER OF CITIZENSHIP TO ALL TO WHOM THESE PRESENTS SHALL COME GREETING WHEREAS The Corporations Act provides that with the exceptions therein contained the Lieutenant Governor may in his discretion, by Letters Patent, issue a Charter to any number of persons, not fewer than three, of twenty-one or more years of age, who apply therefor, constituting them and any others who become shareholders or members of the corporation thereby created a corporation for any of the objects to which the authority of the Legislature extends; AND WHEREAS by the said Act it is further provided that the Provincial Secretary may in his discretion and under the Seal of his office have, use, exercise and enjoy any power, right or authority conferred by the said Act on the Lieutenant Governor; AND WHEREAS by their Application in that behalf the persons herein named have applied for the issue of a Charter constituting them a corporation for the due carrying out of the undertaking hereinafter set forth; AND WHEREAS it has been made to appear that the said persons have complied with the conditions precedent to the issue of the desired Charter and that the said undertaking is within the scope of the said Act; AND WHEREAS by The Department of the Provincial Secretary and Citizenship Act, 1960-61 it is provided that the Provincial Secretary and Minister of Citizenship may exercise the powers that were conferred on the Provincial Secretary at the time the said Act came into force; [ILLEGIBLE] THEREFORE KNOW YE that under the [ILLEGIBLE] of the hereinbefore in part recited Acts I DO BY THESE [ILLEGIBLE] issue a Charter to the Persons hereinafter named [ILLEGIBLE] Ivan Milankov, Machinist, and [ILLEGIBLE] Milankov, housewife, both of the City of Toronto, in the County of York and Province of Ontario, and Jovan Milankov, Machinist, and Nada Milankov, housewife, both of the town of [ILLEGIBLE], in the said County of York; constituting them and any others who become shareholders of the Company hereby created a company under the name of PROGRESS PRECISION MACHINERY & TOOL MANUFACTURING LIMITED for the following subjects, that is to say: (a) TO manufacture, import, export, buy, sell, deal in, repair, [ILLEGIBLE] and maintain all kinds of machinery, tools, [ILLEGIBLE] and equipment, whether moved by mechanical power or not; and (b) TO carry on business as iron and brass founders and manufacturers and fabricators of and dealers in steel, iron, brass, copper, zinc, wood and other natural products and as [ILLEGIBLE] and [ILLEGIBLE], and to manufacture, buy, sell and deal in goods, [ILLEGIBLE] and merchandise used in whole or in part of steel, [ILLEGIBLE], brass, copper, zinc, wood and other natural products, and to buy, sell, and deal in hardware and specialties of all [ILLEGIBLE], machines and [ILLEGIBLE] supplies; [ILLEGIBLE] Company to be divided into Thirty-six [ILLEGIBLE] preference shares with a par value of [ILLEGIBLE] and Four Thousand (4,000) common shares without par value; provided that the common shares shall not be issued for a consideration exceeding in amount or value the sum of Four Thousand dollars ($4,000) or such greater amount as the board of directors of the Company deems expedient on payment to the Treasurer of Ontario of the fees payable on such greater amount and on the issuance by the Provincial Secretary of a certificate of such payment; THE HEAD OFFICE of the Company to be situate in The Municipality of Metropolitan Toronto, in the said County of York; and THE FIRST DIRECTORS of the Company to be Ivan Milankov, [ILLEGIBLE] Milankov, Jovan Milankov and Nada Milankov, hereinbefore mentioned; AND IT IS [ILLEGIBLE] AND DECLARED that the said Company shall be a PRIVATE COMPANY and that the following provisions shall apply thereto: (1) The right to transfer shares of the Company shall be restricted in that no share shall be transferred without the express consent of the directors, to be signified by a resolution passed by the board; (2) The number of shareholders of the Company, exclusive of persons who are in the employment of the Company, is hereby limited to fifty (50), two (2) or more persons holding one (1) or more shares jointly being counted as a single shareholder; and (3) Any invitation to the public to subscribe for any shares or securities of the Company is hereby prohibited; AND IT IS [ILLEGIBLE] AND DECLARED that the said non-voting preference shares (hereinafter called the "preference shares") shall have attached thereto the following: (1) The preference shares shall carry the right to receive, when declared by the board of directors, a fixed non-cumulative preferential dividend at the rate of six per cent (6%) [ILLEGIBLE] on the amount paid up thereon, payable out of the net profits of the Company, such dividends to be paid annually; (2) The preference shares shall rank, both as regards dividend and repayment of capital, in priority to all other shares of the Company but shall not [ILLEGIBLE] any further right to participate in profits or assets; (3) In the event of the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the holders of preference shares shall be entitled to receive, before any distribution of any part of the assets of the Company among the holders of any other shares, the amount paid up thereon and any dividends declared thereon and unpaid and no more; (4) The Company may at its option redeem the whole or any part [ILLEGIBLE] for each share to be redeemed [ILLEGIBLE] thereon plus a premium of ten per cent (10%) [ILLEGIBLE]; and (5) The holders of the preference shares shall not be entitled to vote at any [ILLEGIBLE] of the shareholders of the Company but shall be entitled to notice of meetings of shareholders called for the purpose of authorizing the dissolution of the Company or the sale of its undertaking or a substantial part thereof; the holders of the common shares shall be entitled to one (1) vote for each common share held by them at all shareholders' meetings. GIVEN under my hand and Seal of office at the City of Toronto in the said Province of Ontario this twenty-third day of July in the year of Our Lord one thousand nine hundred and sixty-five. John [ILLEGIBLE] John [ILLEGIBLE] Provincial Secretary and [ILLEGIBLE] [LOGO] Ministry of Ministere de 142088 Consumer and la Consommation Commercial et du Commerce Relations CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les presents articles are effective on statuts entrent en vigueur le DECEMBER 3 DECEMBRE, 1987 ------------------------- /s/ [ILLEGIBLE] Director Le Director TRANS Companies Branch Direction des Compagnies CODE [c] ARTICLE OF AMENDMENT STATUTS DE MODIFICATION Form 3 1. The present name of the Denomination sociale actuelle Business corporation is: de la compagnie: Corporations Act, PROGRESS PRECISION INC. 1982 Formule 2. The name of the corporation Nouvelle denomination sociale numero 3 is changed to (If applicable): de la compagnie (s'il y a lieu): Loi de 1982 ---------------------------------------------------------------- sur les ---------------------------------------------------------------- compagnies ---------------------------------------------------------------- ---------------------------------------------------------------- ---------------------------------------------------------------- 3. Date of incorporation/ Date de la constitution ou amalgamation: de la fusion: July 23rd, 1965 ------------------------------------------------------------------- (Day, Month, Year) (jour, mois, annee) 4. The articles of the corporation, are amended as follows: Les statuts de la compagnie sont modifies de la facon suivante: BE IT RESOLVED as a special resolution of the Corporation that the Letters Patent of the Corporation are hereby amended to change the 36,000 authorized preference shares of capital of the Corporation to: an unlimited number of Class A special retractable, redeemable voting shares without par value, and an unlimited number of Class B special non-voting, non-retractable, redeemable shares without par value. 1A The rights, privileges, restrictions and conditions (if any) attaching to each class of shares and directors authority with respect to any class of shares which may be issued in series: 1. The Class A special shares shall have attaching thereto as a class, the following rights, privileges, restrictions and conditions: (a) the holders of the Class A special shares shall in each year in the discretion of the directors, but always in preference and priority to any payment of dividends on the Class B special shares and the common shares for such year, be entitled, out of any of all profits or surplus available for dividends, to such non-cumulative dividends at the rate of 1/2% per month on the amount paid to the Corporation for such share. If in any year, after providing for the full dividend on the Class A special shares, there shall remain any profits or surplus available for dividends, such profits or surplus or any part thereof may, in the discretion of the directors, be applied to dividends on the Class B special shares and the Common shares; the holders of Class A special shares shall not be entitled to any dividend other than or in excess of the non-cumulative dividends at the said rate hereinbefore provided for; (b) the Class A special shares shall rank, both as regards dividends and return of capital, in priority to the Class B special shares and the common shares of the Corporation but shall not confer any further right to participate in profits or assets. Except with the consent in writing of all the Class A special shares outstanding, no dividend shall at any time be declared and paid on or set apart for payment on the Class B special shares or common shares in any fiscal year unless and until the preferential non-cumulative dividend on all the class A shares outstanding in respect of such fiscal year has been declared and paid or set apart for payment; (c) the Corporation may redeem the whole or any part of the Class A special shares on payment for each share to be redeemed of the amount paid to the Corporation for such shares, together with all dividends declared thereon and unpaid (the "redemption price"). In case a part only of the then outstanding Class A special shares is at any time to be redeemed the shares so to be redeemed shall be selected by lot in such manner as the directors in their discretion shall decide or, if the directors so determine, may be redeemed pro rate, disregarding fractions, and the directors may make such adjustments as may be necessary to avoid the redemption of fractional parts of shares. (d) the corporation shall have the right at its option at any time and from time to time to purchase for cancellation the whole or any of the Class A special shares pursuant to tenders or, with the unanimous consent of the holders of all issued Class A special shares, by private contract at the 1B lowest price at which, in the opinion of the directors, such shares are obtainable but not exceeding the redemption price. If, in response to an invitation for tenders, two or more shareholders submit tenders at the same price and if such tenders are accepted by the Corporation in whole or in part, then unless the Corporation accepts all such tenders in whole, the Corporation shall accept such tenders in proportion as nearly as may be to the number of shares offered in each such tender. (e) in the event of the liquidation, or dissolution or winding up of the Corporation, whether voluntary or involuntary, the holders of the Class A special shares shall be entitled to receive, before any distribution of any part of the assets of the Corporation among the holders of the Class B special shares and the common shares, an amount equal to the redemption price and no more. (f) subject to applicable law the holders of the Class A special shares shall have voting rights for the election of directors or for any other purpose, and shall therefore be entitled to notice of meetings of the shareholders. (g) the foregoing provisions, the provisions of this paragraph and the provisions of paragraph (h) hereof may be repealed, altered, modified or amended by articles of amendment, but only with the approval of the holders of the Class A special shares given as hereinafter specified in addition to any other approval required by the Business Corporations Act, 1982; and (h) the approval of the holders of the Class A special shares as to any and all matters referred to herein may be given by special resolution sanctioned at a meeting of holders of the Class A special shares duly called and held upon at least 10 days' notice at which the holders of at least a majority of the outstanding class A special shares are present or represented by proxy and carried by the affirmative votes of the holders of not less than two-thirds of the Class A special shares represented and voted at such meeting cast on a poll. On every poll taken at such meeting every holder of Class A special shares shall be entitled to one (1) vote in respect of each Class A special share held. 2. The Class B special shares shall have attaching thereto, as a class, the following rights, privileges, restrictions and conditions. (a) the holders of the Class B special shares shall in each year in the discretion of the directors together with the common shares be entitled, out of any or all profits or surplus available for dividends, to such non-cumulative dividends at the rate to be determined by the Board of Directors on the amount paid to the Corporation for such share. If in any year, after providing for the full dividend on the Class B special shares, there shall remain any profits or surplus 1C available for dividends, such profits or surplus or any part thereof may, in the discretion of the directors be applied to dividends on the common shares; the holders of the Class B special shares shall not be entitled to any dividend other than or in excess of the non-cumulative dividend at the said rate hereinbefore provided for. (b) the Class B special shares shall rank both as regards dividends and return capital, equal to the common shares of the Corporation, but shall not confer any further right to participate in profits or assets. (c) the Corporation may redeem the whole or any part of the Class B special shares on payment for each share to be redeemed of the amount paid to the Corporation for such shares, together with all dividends declared thereon and unpaid (the "redemption price"). In case a part only of the then outstanding Class B special shares is at any time to be redeemed the shares so to be redeemed shall be selected by lot in such manner as the directors in their discretion shall decide or, if the directors so determine, may be redeemed pro rate, disregarding fractions, and the directors may make such adjustments as may be necessary to avoid the redemption of fractional parts of shares. (d) the Corporation shall not have the right to purchase for cancellation the whole or any of the Class B special shares. (e) in the event of the liquidation, dissolution or winding up of the corporation, whether voluntary or involuntary, the holders of the Class B special shares shall be entitled to receive, before any distribution of any part of the assets of the Corporation among the holders of the common shares, an amount equal to the redemption price and no more. (f) subject to application law the holders of the Class B special shares shall not, as such, have any voting rights for the election of directors or for any other purpose nor shall they be entitled to attend shareholders' meetings. The holders of the Class B special shares, however, shall be entitled to notice of meetings of the shareholders called for the purpose of authorizing the dissolution of the Corporation or the sale of its undertaking or a substantial part thereof. (g) the foregoing provisions, the provisions of this paragraph and the provisions of paragraph (h) hereof may be repealed, altered, modified or amended by Articles of Amendment but only with the approval of the holders of the Class B special shares given as hereinafter specified in addition to any other approval required by the Business Corporations Act, 1982; and, (h) the approval of the holders of the Class B special shares as to any and all matters referred to herein may be given by special resolution sanctioned at a meeting of the holders of the Class B special shares duly called and held upon at least 1D ten days' notice at which the holders of at least a majority of the outstanding Class B special shares are present or represented by proxy and carried by the affirmative votes of the holders of not less than two-thirds of the Class B special shares represented and voted at such meeting cast on a poll. On every poll taken at such meeting every holder of Class B special shares shall be entitled to one (1) vote in respect of each Class B special share held. 2 5. The amendment has been duly authorized La modification a ete dument as required by Sections 167 and 169 (as autorisee conformement a l'article applicable) of the Business 167 et, s'il y a lieu, article 169 Corporations Act. de la Loi sur les compagnies. 6. The resolution authorizing the Les actionnaires ou les amendment was approved by the administrateurs (le cas echeant) de shareholders/directors (as applicable) la compagnie ont approuve la of the corporation on resolution autorisant la modification 9th day of October, 1987 ------------------------------------------------- (Day, Month, Year) (jour, mois, annee) These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. PROGRESS PRECISION INC. -------------------------------------- (Name of Corporation) (Denomination sociale de la compagnie) By/Par: [ILLEGIBLE] President ----------------------------------------- [Signature] (Description of office) [Signature] (Fonction) For Ministry Use Only Ontario Corporation Number A l'usage exclusif du ministere Numero de la Compagnie en Ontario [LOGO] Ministry of Ministere de 142088 Consumer and la Consommation Commercial at du Commerce Relations CERTIFICATE CERTIFICATE This is to certify that these Ceci certifie que les presents articles are effective on statuts entrent en vigueur le DECEMBER 12 DECEMBRE, 1984 - ------------------------- /S/ [ILLEGIBLE] Controleur des Dossiers TRANS Controller of Records Direction des Compagnies CODE Companies Branch [c] ARTICLES OF AMENDMENT STATUTS DE MODIFICATION Form 3 1. The present name of the Denomination sociale actuelle Business corporation is: de la compagnie: Corporations Act, PROGRESS PRECISION MACHINERY 1982 Formule TOOL MANUFACTURING LIMITED numero 3 Loi de 1982 2. The name of the corporation Nouvelle denomination sociale sur les is changed to (if applicable): de la companie (s'il y a lieu): compagnies PROGRESS PRECISION INC. 3. Date of incorporation/ Date de la constitution ou amalgamation: de la fusion: JULY 23, 1965 ------------------------------------------------------------------ (Day, Month, Year) (jour, mois, annee) 4. The articles of the Les statuts de la compagnie corporation are amended as sont modifies de la facon follows: suivante: BE IT RESOLVED as a special resolution of the Corporation that the Letters Patent of the Corporation are hereby amended to change the name of the Corporation from PROGRESS PRECISION MACHINERY & TOOL MANUFACTURING LIMITED to PROGRESS PRECISION INC. 5. The amendment has been duly authorized La modification a ete dument as required by Sections 187 and 169 (as autorisee conformement a l'article applicable) of the Business 167 et, s'il y lieu, article 169 Corporations Act. de la Loi sur les compagnies. 6. The resolution authorizing the Les actionnaires ou les amendment was approved by the administrateurs (le cas echeant) de shareholders/directors (as applicable) la compagnie ont approuve la of the corporation on resolution autorisant la modification NOVEMBER 27th, 1984 ------------------------------------------------- (Day, Month, Year) (jour, mois, annee) These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. PROGRESS PRECISION MACHINERY & TOOL MANUFACTURING LIMITED ----------------------------------- (Name of Corporation) (Denomination sociale de la compagnie) By/Par: [ILLEGIBLE] President ----------------------------------------- [Signature] (Description of office) [Signature] (Fonction) 1. For Ministry Use Only Ontario Corporation Number A l'usage exclusif du ministere Numero de la societe en Ontario [LOGO] Ministry of Ministere de 142088 Consumer and la Consommation Commercial et du Commercial CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les articles are effective on statuts entrent en vigueur le MARCH 15 MARS, 2001 - ---------------------------- /S/ [ILLEGIBLE] Director/Directrice Business Corporations Act/Loi sur les societes par actions ARTICLES OF AMENDMENT STATUTS MODIFICATION Form 3 1. The name of the corporation Denomination sociale de la Business is: societe: Corporations Act. PROGRESS PRECISION INC. Formule 3 Loi sur les 2. The name of the corporation Nouvelle denomination sociale societes par is changed to (If applicable): de la societe (s'il y a lieu): actions 3. Date of incorporation/ Date de la constitution ou amalgamation: de la fusion: 1965 / July / 23 - -------------------------------------------------------------------------------- (Day, Month, Year) (annee, mois, jour) 4. The articles of the Les statuts de la societe sont corporations are amended as modifies de la facon suivante. follows: See Annexed 1a (1) To change the number of directors of the corporation to a minimum of 1 and a maximum of 20 directors. (2) To delete all the objects of the corporation set out in its articles and to remove any restriction upon the business or the businesses that the corporation may carry on or upon the powers that the corporation may exercise. (3) To reorganize the share capital of the corporation: (a) to remove the maximum number of common shares that the corporation is authorized to issue and to delete the reference to the aggregate consideration for which the common shares may be issued; (4) To add the following provision: (a) Each holder of a fractional share issued by the corporation is entitled to exercise voting rights and to receive a dividend in respect of each such fractional share to the extent of such fraction. (b) The corporation has a lien on each share registered in the name of a shareholder or his legal representative for a debt of that shareholder to the corporation. (c) Without in any way limiting the powers of the corporation, or of the directors, as set forth in the Business Corporations Act (Ontario), as amended or re-enacted from time to time, the directors of the corporation may, without authorization of the shareholders, (i) borrow money upon the credit of the corporation; (ii) issue, reissue, sell or pledge debt obligations of the corporation; (iii) mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the corporation, owned or subsequently acquired, to secure any obligation of the corporation. (d) Articles of dissolution may be filed when authorized by at least a majority of the votes of all shareholders entitled to vote at a meeting of shareholders duly called to authorize the dissolution. 2. 5. The amendment has been duly authorized La modification a ete dument as required by Sections 168 and 170 autorisee conformement aux article (as applicable) of the Business 168 et 178 (selon le cas) de la Loi Corporations Act. sur les societes par actions. 6. The resolution authorizing the Les actionnaires ou les amendment was approved by the administrateurs (selon le cas) de shareholders/directors (as applicable) la societe ont approuve la of the corporation on resolution autorisant la modification le 2001 / March / 13 ------------------------------------------------- (Year, Month, Day) (annee, mois, jour) These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. PROGRESS PRECISION INC. -------------------------------------- (Name of Corporation) (Denomination sociale de societe) By/Par: /s/ Bosko Milankov ----------------------------------------- [Signature] (Description of Office) [Signature] (Fonction) Bosko Milankov - President EX-3.24 22 y98028exv3w24.txt BYLAWS EXHIBIT 3.24 PROGRESS PRECISION MACHINERY & TOOL MANUFACTURING LIMITED BY-LAW NO. TWO A BY-LAW RESPECTING THE BORROWING OF MONEY AND THE ISSUE OF SECURITIES BE IT ENACTED by the Directors as a By-Law of PROGRESS PRESICION MACHINERY & TOOL MANUFACTURING LIMITED, as follows: 1. The directors of the company may from time to time: (a) Borrow money upon the credit of the company and upon such terms as may be deemed necessary; (b) Limit or increase the amount to be borrowed; (c) Issue bonds, debentures, debenture stock or other securities of the company for its lawful purposes, for such amounts and upon such terms as may be deemed expedient and pledge or sell the same for such sums and at such prices as the Directors shall determine. (d) Hypothecate, mortgage, charge or pledge any or all of the real or personal property including book debts and unpaid calls, rights, powers, undertakings and franchises to secure any such bonds, debentures, debenture stock or other securities or any money borrowed for the purpose of the Company. 2. The directors may from time to time authorize any director or directors, officer or officers, employee of the company, or other person or persons, whether connected with the company or not, to make arrangements with reference to the money borrowed or to be borrowed as aforesaid, and as to the terms and conditions of the loan thereof, and as to the securities to be given therefor, with power to vary or modify such arrangements, terms and conditions and to give such additional securities for any moneys borrowed or remaining due by the company as the directors of the company may authorize, and generally to mannage, transact and settle the borrowing of money by the company. 3. The directors may from time to time authorize any director or directors, officer or officers, employee of the company, or other person or persons, whether connected with the company or not to sign, execute and give on behalf of the company all documents, agreements and promises necessary or desirable for the purposes aforesaid and to draw, make, accept, endorse, execute and issue cheques, promissory notes, bills of exchange, bills of lading and other negotiable or transferable instruments, and the same and all renewals or substitutions therefore so signed shall be binding upon the company. 4. The powers hereby conferred shall be deemed to be in supplement of and not in substitution for any powers to borrow money for the purposes of the company possessed by its directors or officers independently of a borrowing by-law. The foregoing by-law is hereby passed by the Directors of the Company pursuant to the Corporations Act, R.S.O. 1960, as evidenced by the respective signatures hereto of all the directors. DATED the 14th day of October, 1965. /s/ IVAN MILANKOV --------------------- IVAN MILANKOV /s/ MIROSLAVA MILANKOV --------------------- MIROSLAVA MILANKOV /s/ JOVAN MILANKOV --------------------- JOVAN MILANKOV /s/ NADA MILANKOV --------------------- NADA MILANKOV The foregoing by-law is hereby confirmed by all the shareholders of the Company pursuant to the Corporations Act, R.S.O. 1960 as evidence by their respective signatures hereto. DATED the 14th day of October, 1965. /s/ IVAN MILANKOV --------------------- IVAN MILANKOV /s/ MIROSLAVA MILANKOV --------------------- MIROSLAVA MILANKOV /s/ JOVAN MILANKOV --------------------- JOVAN MILANKOV /s/ NADA MILANKOV --------------------- NADA MILANKOV PROGRESS PRECISION MACHINERY & TOOL MANUFACTURING LIMITED BY-LAW NO. THREE RESPECTING THE BORROWING OF MONEY BY THE COMPANY BE IT ENACTED as a By-law of the Company that: 1. The Directors may from time to time borrow money from THE BANK OF NOVA SCOTIA (herein called the "Bank") upon the credit of the Company on cheques, promissory notes, bills of exchange or otherwise in such amounts and subject to such terms as may be considered advisable; AND may assign, transfer, convey, hypothecate, mortgage, charge or pledge to or in favour of the Bank any property of the Company, real or personal, moveable or immoveable, present or future, including book debts, unpaid calls, rights, powers, undertaking, franchises and the Company's own debentures, as security for the fulfilment of any liabilities or obligations, present or future, of the Company to the Bank and may empower the Bank or any person or persons to sell by public or private sale, assign, transfer or convey from time to time any such property; AND may sign, make, draw, accept, endorse, execute and deliver on behalf of and in the name of the Company all such cheques, promissory notes, bills of exchange, drafts, acceptances, orders for the payment of money, warehouse receipts, bills of lading, agreements to give security, assignments, transfers, conveyances, hypothecs, mortgages, pledges, securities and other agreements, documents and instruments as may be necessary or useful in connection with the borrowing of money by and other banking business of the Company. 2. The Directors may authorize any one or more directors, officers, employees or agents of the Company to exercise any of the rights, powers and authorities conferred by this By-law upon the Directors. 3. The borrowing of money from the Bank from time to time heretofore under the authority of the Directors of the Company and the giving of security therefor are hereby ratified and confirmed. 4. This By-law shall continue in force as between the Company and the Bank until a By-law repealing this By-law shall have been validly passed and confirmed and a copy thereof, duly certified under the seal of the Company, shall have been delivered to the Bank and receipt thereof acknowledged by the Bank. The foregoing by-law is hereby passed by the Directors of the Company pursuant to the Corporations Act, R.S.O. 1960, as evidenced by the respective signatures hereto of all the directors. DATED the 15th day of October, 1965 /s/ Ivan Milankov --------------------- Ivan Milankov /s/ Miroslava Milankov --------------------- Miroslava Milankov /s/ Jovan Milankov --------------------- Jovan Milankov /s/ Nada Milankov --------------------- Nada Milankov The foregoing by-law is hereby confirmed by all the shareholders of the Company pursuant to the Corporations Act, R.S.O. 1960 as evidenced by their respective signatures hereto. DATED the 15th day of October, 1965 /s/ Ivan Milankov --------------------- Ivan Milankov /s/ Miroslava Milankov --------------------- Miroslava Milankov /s/ Jovan Milankov --------------------- Jovan Milankov /s/ Nada Milankov --------------------- Nada Milankov PROGRESS PRECISION MACHINERY & TOOL MANUFACTURING LIMITED BY-LAW NO. 4 Be it enacted by the Directors as a By-Law of Progress Precision Machinery & Tool Manufacturing Limited, as follows: WHEREAS the Company is engaged in mutual business dealings with Myroslava Milankov which are of benefit to this Company, and has been requested by Myroslava Milankov to guarantee repayment of a loan to be made by Industrial Development Bank to Myroslava Milankov AND WHEREAS it is desirable in the interests of this Company that such guarantee be granted NOW, THEREFORE, BE IT RESOLVED: 1. That this Company do guarantee repayment of a loan to be made to Myroslava Milankov by Industrial Development Bank of ONE HUNDRED AND FORTY THOUSAND AND TWENTY SIX DOLLARS repayable in and by one instalment of $456.00 due on the 23rd day of March, 1974, and followed by 143 monthly instalments of $990.00 on the 23rd day of each and every month from and including the 23rd day of April, 1974, to and including the 23rd day of February, 1986 and the balance of the said principal sum shall become due and payable on the 23rd day of March 1986 2. THAT for the purpose of giving effect to such guarantee this Company do execute a mortgage of land and guarantee to Industrial Development Bank, in the above terms. 3. THAT the draft of the mortgage and Guarantee in favour of said Industrial Development Bank to evidence and secure said loan which have been submitted to and examined by this meeting, be and the same are hereby approved. 4. THAT any one officer or director of the Company be and is hereby authorized to execute on behalf of this Company a mortgage of land and guarantee in or substantially in the form and terms of the said draft and to do all other things which they may consider to be necessary, desirable or useful for the purpose of carrying out and fulfilling the Company's obligations to the Bank. Enacted this 23rd day of October 1973. /s/ Jovan Milankov --------------------- /s/ Ivan Milankov Secretary - ------------------- President CERTIFICATE The undersigned, Secretary of Progress Precision Machinery and Tool Manufacturing Limited, hereby certifies that the foregoing By-Law was enacted at a meeting of the Directors of the said Company duly called and held, and was duly sanctioned and confirmed at a special general meeting of the shareholders of the Company properly convened on the 23rd day of October 1973, and that the said By-Law is in full force and effect. DATED at Toronto this 2nd day of November 1973. WITNESS the corporate seal of the Company. /s/ Jovan Milankov ------------------------ Secretary 13626 (Borrowing Authority) Dominion, Alta, Man., N.B., Ontario. P.E.I. Que. or Sask. Company BY-LAW AUTHORIZING BORROWING AND PLEDGING Progress Precision Inc. ----------------------------------------- (Name of Company) Incorporated under Ontario Corporations Act ------------------------- (Name of Act) BE IT AND IT IS HEREBY ENACTED as a By-Law of the Company as follows: BY-LAW NO. 5 1. That the Directors of the Company may from time to time: (a) borrow money upon the credit of the Company by obtaining loans or advances or by way of overdraft or otherwise; (b) issue, sell or pledge securities of the Company including bonds, debentures, debenture stock, for such sums on such terms and at such prices as they may deem expedient; (c) assign, transfer, convey, hypothecate, mortgage, pledge, charge or give security in any manner upon all or any of the real or personal, moveable or immoveable property, rights, powers, choses in action, or other assets, present or future, of the Company to secure any such securities or other securities of the Company or any money borrowed or to be borrowed or any obligations or liabilities as aforesaid or otherwise of the Company heretofore, now or hereafter made or incurred directly or indirectly or otherwise; and (d) without in any way limiting the powers herein conferred upon the Directors, give security or promises to give security, agreements, documents and instruments in any manner or form under the Bank Act or otherwise to secure any money borrowed or to be borrowed or any obligations or liabilities as aforesaid or otherwise of the Company heretofore, now or hereafter made or incurred directly or indirectly or otherwise. 2. That any or all of the foregoing powers may from time to time be delegated by the Directors to any one or more of the directors or officers of the Company. BY-LAW NO.6 a by-law relating generally to the transaction of the business and affairs of PROGRESS PRECISION INC. (hereinafter called the "Corporation") CONTENTS 1 Definitions & Interpretation 7 Meetings of Shareholders 2 Directors 8 Shares 3 Meetings of Directors 9 Dividends 4 Delegation 10 Notices 5 Officers 11 Execution of Contracts 6 Protection of Directors, Officers and 12 Shareholders' Agreement Others BE IT ENACTED as a by-law of the Corporation as follows: 1 DEFINITIONS & INTERPRETATION 1.1 In this by-law: (a) "Act" means THE BUSINESS CORPORATIONS ACT (ONTARIO), and the regulations thereunder, as amended from time to time, or any successor Act or regulations thereto, as the case may be; (b) "Board" means the board of directors of the Corporation; (c) "meetings of shareholders" includes annual and special meetings. Unless it is otherwise provided for herein, any other words and expressions used in this by-law have the meaning attributed thereto in the Act. 1.2 Words importing the singular include the plural and vice versa, and words importing gender include the masculine, feminine and neuter genders. -2- 2 DIRECTORS 2.1 Election and Term Shareholders of the Corporation shall at the first meeting of shareholders and at each succeeding annual meeting of shareholders, elect directors to hold office for a term expiring at the first annual meeting of shareholders following their election. 2.2 Resignation A director who is not named in the articles may resign from office upon giving a written resignation to the Corporation and such resignation becomes effective when received by the Corporation or at the time specified in the resignation, whichever is later. A director named in the articles shall not be permitted to resign from his office unless at the time the resignation is to become effective a successor is elected or appointed. 2.3 Removal Subject to the provisions of the Act, the shareholders may, by ordinary resolution passed at an annual or special meeting remove any director or directors from office before the expiration of his term and the vacancy created by such removal may be filled at the same meeting, failing which it may be filled by the directors. 2.4 Vacancies Subject to the Act, a quorum of the Board may fill a vacancy in the Board, except a vacancy resulting from an increase in the number of directors or in the maximum number of directors or from a failure of the shareholders to elect the number of directors. In the absence of a quorum of the Board, or if the vacancy has arisen from a failure of the shareholders to elect the number of directors, the Board shall forthwith call a special meeting of shareholders to fill the vacancy. If the Board fails to call such a meeting or if there are no such directors then in office, any shareholder may call the meeting. 3 MEETINGS OF DIRECTORS 3.1 Meetings by Telephone If all of the directors present at or participating in the meeting consent, any director may participate in a meeting of the Board or of a committee of the Board by means of such telephone, electronic or other communications facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and a director participating in such meeting by such means is deemed for the purposes of the Act and this by-law to be present at that meeting. -3- 3.2 Calling of Meetings The Board, a quorum of directors, the president or the secretary may at any time call a meeting of the Board to be held at the time and place determined by the Board or by the person calling the meeting. Meetings of the Board may be held at any place within or outside Ontario. In any financial year of the Corporation, a majority of the meetings of the Board need not be held within Canada. Notice of every meeting so called shall be given to each director not less than forty-eight (48) hours (excluding any part of a Sunday and of a holiday as defined by the Interpretation Act) before the day on which the meeting is to be held. A director may in any manner and at any time waive notice of a meeting of directors and attendance by a director at a meeting of directors is a waiver of notice of the meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called. If a quorum of directors is present, each newly elected Board may without notice hold its first meeting for the purposes of its organization and the appointment of officers immediately following the meeting of shareholders at which such Board was elected. 3.3 A notice of a meeting of directors need not specify the purpose of or the business to be transacted at the meeting except where the Act requires such purpose or business to be specified. 3.4 Quorum Subject to the articles of the Corporation, a quorum at any meeting of the Board is: (a) where the articles set out the number of directors, a majority of that number, or (b) where the articles set out the minimum and maximum number of directors, a majority of the number of directors which then constitutes the Board. 3.5 Chairman of Directors' Meeting In the event that the Chairman of the Board, if any, the President or any Vice-President fails to assume the chairmanship of a meeting within 15 minutes after the time appointed for the holding of the meeting, the persons present at the meeting and entitled to vote thereat shall choose a person from their number to be the chairman of the meeting. -4- 3.6 Votes to Govern At all meetings of the Board, every question shall be decided by a majority of the votes cast on the question. In the case of an equality of votes, the chairman of the meeting shall not be entitled to a second or casting vote. 3.7 Disclosure of Interest in Contracts Every director or officer of the Corporation who is party to, or who is a director or officer of or has a material interest in any person who is a party to, a material contract or transaction, or a proposed material contract or transaction with the Corporation shall disclose in writing to the Corporation or request to have entered in the minutes of the meeting of directors the nature and extent of his interest as required by the Act. Any such contract or transaction or proposed contract or transaction shall be referred to the Board or shareholders for approval even if such contract or transaction or proposed contract or transaction is one that in the ordinary course of the Corporation's business would not require approval by the Board or shareholders, and a director interested in a contract or transaction or proposed contract or transaction so referred to the Board shall not vote on any resolution to approve same except as provided by the Act. 3.8 Resolution in Lieu of Meeting A resolution in writing, signed by all of the directors entitled to vote on that resolution at a meeting of directors or a committee of directors, is as valid as if it had been passed at a meeting of directors or a committee of directors. A copy of every such resolution shall be kept with the minutes of the proceedings of the directors or committee of directors. 4 DELEGATION 4.1 Managing Director and Committee of Directors The Board may appoint from their number a managing director who is a resident Canadian or a committee of directors, and delegate to such managing director or committee any of the powers of the Board except those which, under the Act, a managing director or committee of directors has no authority to exercise. A majority of the members of such committee shall be resident Canadians. The powers of a committee of directors may be exercised by a meeting at which a quorum is present or by resolution in writing signed by all of the members of such committee who would have been entitled to vote on that resolution at a meeting of the committee. A meeting of such committee may be held at any place within or outside Ontario. -5- Unless otherwise determined by the Board, each committee shall have the power to fix its quorum at not less than a majority of its members, to elect its chairman and to regulate its procedure. To the extent that the committee does not establish rules to regulate its procedure, the provisions of this by-law applicable to meetings of the Board shall apply mutatis mutandis. 5 OFFICERS 5.1 Subject to the articles and any unanimous shareholder agreement, the Board may from time to time appoint a president, one or more vice presidents (to which title may be added words indicating seniority or function), a secretary, a treasurer and such other officers as the Board may determine, including one or more assistants to any of the officers so appointed. The Board may specify the duties of and, in accordance with this by-law and subject to the provisions of the Act, delegate to such officers powers to manage the business and affairs of the Corporation. Two or more offices of the Corporation may be held by the same person. 5.2 Chairman of the Board The Board may from time to time appoint a chairman of the Board who shall be a director. If appointed, the chairman shall, subject to the provisions of the Act, the articles or any unanimous shareholder agreement, preside at all meetings of the shareholders and the Board and have such other powers and duties as the Board may specify. During the absence or disability of the chairman of the Board, his duties shall be performed and his powers exercised by the managing director, if any, or by the president. 5.3 President Subject to any duties imposed upon the chairman of the Board, if one is appointed, the president shall preside at all meetings of the shareholders and of the Board and is responsible for the general supervision of the business of the Corporation. 5.4 Vice-President During the absence or inability of the President to act, his duties shall be performed and his powers shall be exercised by the vice-president, or if there is more than one, by the vice-president selected by the Board. A vice-president shall also perform such duties and exercise such powers as the president or the Board may from time to time delegate to him. -6- 5.5 Secretary The secretary shall: (a) attend all meetings of the directors, shareholders and committees and enter or cause to be entered in books kept for that purpose minutes of all proceedings at such meetings; (b) give or cause to be given all notices required to be given to shareholders, directors, officers, auditors and members of committees; (c) be the custodian of all books, papers, records, documents, corporate seals, if any, and other instruments of the Corporation, except when some other officer or agent of the Corporation has been appointed for that purpose by resolution of the Board. The secretary may delegate his duties to a nominee from time to time. 5.6 Treasurer The treasurer shall keep or cause to be kept full and accurate accounting records in compliance with the Act and shall be responsible for the deposit of money, the safekeeping of securities and the disbursement of the funds of the Corporation; he shall render to the Board whenever required of him, an account of the financial affairs of the Corporation. 5.7 Powers and Duties of Other Officers The powers and duties of all other officers shall be such as the terms of their engagement call for or as the Board or the president may specify. Any of the powers and duties of an officer to whom an assistant has been appointed may be exercised and performed by such assistant, unless the Board or the president otherwise directs. 5.8 Variation of Powers and Duties The Board may from time to time and subject to the provisions of the Act, vary, add to or limit the powers and duties of any officer. 5.9 Term of office The terms of employment of the officers shall be settled by the Board. In the absence of written agreement to the contrary, each officer holds office until he resigns, his successor is appointed or he is removed by the Board at its pleasure. -7- 6 PROTECTION OF DIRECTORS, OFFICERS AND OTHERS 6.1 Limitation of Liability No director or officer shall be liable for the acts, receipts, neglects or defaults of any other director or officer or employee, or for joining in any receipt or other act for conformity, or for any loss, damage or expense happening to the Corporation through the insufficiency or deficiency of title to any property acquired for or on behalf of the Corporation, or for the insufficiency or deficiency of any security in or upon which any of the moneys of the Corporation shall be invested, or for any loss or damage arising from the bankruptcy, insolvency or tortious acts of any person with whom any of the moneys, securities or effects of the Corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his part, or for any other loss, damage or misfortune whatever which shall happen in the execution of the duties of his office or in relation thereto; provided that nothing herein shall relieve any director or officer from the duty to act in accordance with the Act and the regulations thereunder or from liability for any breach thereof. 6.2 Indemnity Subject to the Act, the Corporation shall indemnify a director or officer, a former director or officer, or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor (or a person who undertakes or has undertaken any liability on behalf of the Corporation or any such body corporate) and his heirs and legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of the corporation or such body corporate, if: (a) he acted honestly and in good faith with a view to the best interests of the Corporation; and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful. -8- 7 MEETINGS OF SHAREHOLDERS 7.1 Annual meetings The annual meeting of shareholders shall be held at the time and place determined by the Board, the president or the secretary for the purpose of considering the financial statements and reports required by the Act to be read or laid before the shareholders of the Corporation at an annual meeting, electing directors, appointing an auditor, if any, and fixing or authorizing the Board to fix the auditor's remuneration and for the transaction of such other business as may properly be brought before the meeting. 7.2 Special Meetings Subject to the Act, the Board, the president or the secretary may at any time call a special meeting of the shareholders of the Corporation to be held at the time and place determined by the Board or the person calling the meeting. 7.3 Notice of Meetings Notice of the time and place of each meeting of the shareholders shall be sent not less than ten (10) and not more than fifty (50) days before the date of the meeting to each director, to the auditor, if any, and to each shareholder entitled to vote at the meeting. Notice of a meeting of shareholders called for any purpose other than consideration of the minutes of an earlier meeting, financial statements the auditors' report, if any, election of directors and reappointment of the incumbent auditor, if any, shall state the nature of such business in sufficient detail to permit the shareholder to form a reasoned judgment thereon and shall state the text of any special resolution to be submitted to the meeting. A shareholder may in any manner waive notice of or otherwise consent to a meeting of shareholders. 7.4 Scrutineers At each meeting of the shareholders one or more scrutineers may be appointed to serve at the meeting by a resolution of the meeting or by the chairman of the meeting with the consent of the meeting. Such scrutineers need not be shareholders of the Corporation. 7.5 Persons Entitled to be Present The only persons entitled to attend a meeting of shareholders are those persons entitled to vote thereat, the directors of the Corporation, the auditors of the Corporation, if any, and others who are entitled or required under any provision of the Act or the articles or by-laws to be present at the meeting. Any other person may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting. -9- 7.6 Quorum Holders of 51% of the issued shares entitled to vote at a meeting of shareholders, whether present in person or represented by proxy constitute a quorum for the transaction of business at any meeting of shareholders. If a quorum is present at the opening of a meeting of shareholders, the shareholders present may proceed with the business of the meeting notwithstanding that a quorum is not present throughout the meeting. 7.7 Proxies (a) A shareholder entitled to vote at a meeting of shareholders may by means of a proxy appoint a proxyholder, or one or more alternative proxyholders, who need not be shareholders, to attend and act at the meeting in the manner and to the extent authorized by the proxy. (b) A proxy shall be executed by the shareholder or by his attorney authorized in writing or, if the shareholder is a body corporate, by an officer or attorney thereof duly authorized and shall conform with the requirements of the Act. 7.8 Representative If a body corporate or association is a shareholder of the Corporation, the Corporation shall recognize any individual authorized by a resolution of the Board of directors or governing body of the body corporate or association to represent it at meetings of shareholders of the Corporation. An individual so authorized may exercise on behalf of the body corporate or association he represents all the powers it could exercise if it were an individual shareholder. 7.9 Votes to Govern Subject to the Act or the articles of the Corporation or any unanimous shareholder agreement, at all meetings of shareholders all questions proposed for the consideration of the shareholders shall be determined by the majority of the votes cast on the question. In the case of an equality of votes the chairman shall not be entitled to a second or casting vote. -10- 7.10 Voting (a) Show of Hands Voting at a meeting of shareholders shall be by show of hands except where a ballot is demanded by a shareholder or proxyholder entitled to vote at the meeting. A shareholder or proxyholder may demand a ballot either before or after any vote by show of hands. Upon a show of hands every person present and entitled to vote has one vote. Whenever a vote by show of hands has been taken upon a motion, unless a ballot thereon is demanded, a declaration by the chairman of the meeting that the vote upon the motion has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting is prima facie evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against the motion and the result of the vote so taken is the decision of the shareholders of the Corporation upon the motion. A demand for a ballot may be withdrawn at any time prior to the taking of the ballot. (b) Ballot Upon a ballot each shareholder who is present or represented by proxy is entitled, in respect of the shares which he is entitled to vote at the meeting upon the motion, to that number of votes provided by the Act or the articles in respect of those shares and the result of the ballot is the decision of the shareholders of the Corporation upon the motion. 7.11 Chairman of Shareholders' Meeting In the event that the chairman of the Board, if any, the president or any vice president fails to assume the chairmanship of a meeting in accordance with this by-law within 15 minutes after the time appointed for the holding of the meeting, the persons present at the meeting and entitled to vote thereat shall choose a person from their number to be the chairman of the meeting. 7.12 Resolution in Writing A resolution in writing signed by all of the shareholders entitled to vote on that resolution at a meeting of shareholders is as valid as if it had been passed at a meeting of the shareholders unless a written statement or representation with respect to the subject matter of the resolution is submitted by a director or the auditors in accordance with the Act. -11- 8 SHARES 8.1 Share Certificates Every shareholder is entitled, at his option, to a share certificate, or to a non-transferrable written acknowledgement of his right to obtain a share certificate from the Corporation in respect of the shares of the Corporation held by him, but the Corporation is not bound to issue more than one share certificate in respect of a share or shares held jointly by several persons, and delivery of a share certificate to one of several joint shareholders is sufficient delivery to all. (a) A share certificate shall be signed manually by at least one director or officer of the Corporation or by or on behalf of a registrar, transfer agent, branch transfer agent or other authenticating agent of the Corporation. (c) Notwithstanding the foregoing, a fractional share certificate need not be manually signed. 8.2 Replacement of Share Certificates Where the registered holder of a share certificate claims that the share certificate has been lost, apparently destroyed or wrongfully taken, the Corporation shall issue a new share certificate in place of the original share certificate if the owner: (a) so requests before the Corporation has notice that the share certificate has been acquired by a bona fide purchaser; (b) files with the Corporation an indemnity bond sufficient in the Corporation's opinion to protect the Corporation and any transfer agent, registrar or other agent of the Corporation from any loss that it or any of them may suffer by complying with the request to issue a new share certificate; and (c) satisfies any other reasonable requirements imposed by the Corporation. 8.3 Lien on Shares The Corporation has a lien on each share registered in the name of a shareholder or his legal representative for a debt of that shareholder to the Corporation. -12- 8.4 Enforcement of Lien If any shareholder (the "Defaulting Shareholder") defaults in payment of any monies owing by such shareholder to the Corporation, which default continues for a period of 30 days after notice in writing of such default has been given by the Corporation to such shareholder, the Corporation may sell all or any part of the shares then registered in the name of the Defaulting Shareholder (the "shares) at a bona fide public or private sale or auction, at which sale or auction any director, officer or shareholder of the Corporation may purchase the shares or the Corporation may purchase the shares free of any right or equity of redemption, which right or equity is hereby expressly waived. The terms and manner of auction or sale shall be at the sole discretion of the Corporation. The Corporation may accept any offer which it in its absolution discretion considers advisable upon such terms, whether cash or credit or partly cash and partly credit, as it in its discretion considers advisable. Notice of any public or private sale or auction shall be given to the Defaulting Shareholder at least 15 days prior to the date on which such sale is to be held. The proceeds of such sale shall be used and applied firstly to the cost and expense of such sale incurred by the Corporation, including legal fees, secondly to reimburse the Corporation for out-of-pocket expenses incurred in connection with the sale and thirdly, for the payment in full of the monies due to the Corporation from any Defaulting Shareholder. The balance of the proceeds, if any, shall be paid to the Defaulting Shareholder. If the proceeds of the sale are insufficient to pay the amount due to the Corporation, then the Defaulting Shareholder shall remain liable to the Corporation for any such deficiency. The rights of the Corporation hereunder shall be in addition to any rights at law available to the Corporation for the enforcement of its liens or for the collection of the debt of the Defaulting Shareholder. 9 DIVIDENDS 9.1 Dividends Subject to the provisions of the Act, the Board may from time to time declare dividends payable to the shareholders according to their respective rights and interests in the Corporation. Dividends may be paid in money or property or by issuing fully-paid shares of the Corporation or rights to acquire fully-paid shares of the Corporation. A dividend payable in cash shall be paid by cheque to the order of each registered holder of shares of the class or series in respect of which such dividend has been declared and mailed by prepaid ordinary mail postage prepaid to such registered holder at his recorded address, unless such holder otherwise directs in writing. In the case of joint holders the cheque shall, unless such joint holders otherwise direct in writing, be made payable to the order of all of such joint holders and mailed to them at their recorded address. The mailing or delivery of such cheque as aforesaid shall satisfy and discharge all liability for the dividend to the extent of the sum represented thereby plus the amount of any tax which the Corporation is required to and does withhold. -13- In the event of non-receipt of any dividend cheque by the person to whom it is mailed or delivered as aforesaid, the Corporation shall issue to such person a replacement cheque for a like amount upon being furnished with such indemnity, reimbursement of expenses and evidence of non-receipt as the Board may from time to time prescribe, whether generally or in any particular case. 9.2 Joint Shareholders If two or more persons are registered as joint holders of any share, any one of such persons may give effectual receipts for the certificates issued in respect thereof and for any dividend, bonus, return of capital or other money payable or warrant issuable in respect of such share. 10 NOTICES 10.1 Method of Giving Notice A notice or document required by the Act, the articles or the by-laws to be sent to a shareholder, director, auditor or member of a committee of the Board may be sent by prepaid mail addressed to, or may be delivered personally to: (a) the shareholder at his latest address shown in the records of the Corporation or its transfer agent; and (b) the director at his latest address as shown in the records of the Corporation or in the most recent notice filed under the Corporations Information Act, whichever is the more current. 10.2 Notice to Joint Shareholders All notices with respect to any shares registered in more than one name may, if more than one address appears on the books of the Corporation in respect to such joint holding, be given to such joint shareholders at the first address so appearing, and notice so given shall be sufficient notice to all the holders of such shares. 10.3 Signature of Notices The signature of any notice to be given by the Corporation may be written or printed or partly written and partly printed. -14- 10.4 Omissions and Errors The accidental omission to give any notice to any shareholder, director, officer, auditor or member of a committee of the Board or the non-receipt of any notice by any such person or any error in any notice not affecting the substance thereof, shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise founded thereon. 10.5 Persons Entitled by Death or Operation of Law Every person who, by operation of law, transfer, death of a shareholder or any other means whatsoever, becomes entitled to any share or shares, shall be bound by every notice in respect of such share or shares which is duly given to the shareholder from whom he derives his title to such share or shares until such time as his name and address are entered on the books of the Corporation (whether it be before or after the event upon which he became so entitled). 10.6 Waiver of Notice Where a notice or document is required by the Act or by any by-law to be sent, the notice may be waived or the time for the notice may be waived or abridged at any time with the consent in writing of the person entitled thereto. 11 EXECUTION OF CONTRACTS 11.1 Execution of Instruments Deeds, transfers, assignments, contracts and any other documents of the Corporation shall be signed on behalf of the Corporation by: the President alone. Any director or officer of the Corporation is hereby authorized and directed to sign any articles on behalf of the Corporation. Notwithstanding any provision to the contrary contained in the by-laws of the Corporation, the Board may at any time or times direct the manner in which and the person or persons by whom any particular deed, transfer, assignment, contract or other document, or any class of deeds, transfers, assignments, contracts or other documents, shall be signed. -15- 11.2 Banking Arrangements All funds of the Corporation shall be deposited in its name in such account or accounts as are designated by the Board. Withdrawals from such account or accounts and the making, signing, drawing, accepting, endorsing, negotiating, lodging, depositing or transferring of any cheques, promissory notes, drafts, acceptances, bills of exchange and orders for the payment of money with the institution maintaining such account or account shall be made by such person or persons as the Board from time to time determines. 12 SHAREHOLDERS' AGREEMENT 12.1 Notwithstanding anything contained in this by-law and any amendment or supplement hereto, the provisions of this by-law and any amendment or supplement hereto shall be amended to the extent necessary to give effect to the provisions of any shareholders' agreement in force between the Corporation and its shareholders, and to the extent that there is any conflict between the provisions of this by-law and any amendment or supplement hereto and any such shareholders' agreement, the provisions of such shareholder's agreement shall prevail. 13 REPEAL 13.1. By-law No. 1 and any other by-laws inconsistent herewith be and the same are hereby repealed. ENACTED by the Board on the 13th day of March, 2001. /s/ Bosko Milankov /s/ Bosko Milankov - ---------------------- ----------------------- Bosko Milankov Bosko Milankov President Secretary CONFIRMED by the shareholder(s) in accordance with the Act on the 13th day of March, 2001 /s/ Bosko Milankov ------------------------------- Bosko Milankov - Secretary EX-3.25 23 y98028exv3w25.txt ARTICLES OF INCORPORATION EXHIBIT 3.25 450500 ---------------- CERTIFICATE [LOGO] Ministry of Consumer and Commercial Ontario Relations THIS IS TO CERTIFY THAT THESE ARTICLES ARE EFFECTIVE ON JULY 4, 1980 /s/ [ILLEGIBLE] --------------------- Trans Line Comp Method CONTROLLER OF RECORDS Code No. Stat Type Incorp. COMPANIES SERVICES BRANCH ----- ---- ---- ---- ------- [A] [0] [0] [A] [3] 18 20 28 29 30 Notice Share Reg'd Jurisdiction ----- ------ ---------------- [S] [N] [ONTARIO] 31 32 33 47 ARTICLES OF INCORPORATION Form 1 1. THE NAME OF THE CORPORATION IS The Business Corporation 450500 ONTARIO LIMITED Act 2. THE ADDRESS OF THE HEAD OFFICE IS 875 Ouellette Avenue ------------------------------------------------------------- (Street & Number or R.R. Number & if Multi-Office Building give Room No.) Windsor [N 9 A 6 S 7] --------------------------------------------------------------- (Name of Municipality or Post Office) (Postal Code) City of Windsor County of Essex --------------------------------- in the ---------------------- (Name of Municipality, Geographical (County, District, Township) Regional Municipality) 3. THE NUMBER OF DIRECTORS IS ONE 4. THE FIRST DIRECTOR(S) IS/ARE RESIDENCE ADDRESS, GIVING STREET & NAME IN FULL, INCLUDING NO. OR R.R. NO. & MUNICIPALITY OR ALL GIVEN NAMES POST OFFICE AND POSTAL CODE ------------------------ ------------------------------------- ALLAN MUIR PATON 1139 Argyle Street Windsor, Ontario N8Y 3K2 5. THE OBJECTS FOR WHICH THE CORPORATION IS INCORPORATED ARE (a) To manufacture, produce, adapt, prepare, import, export, buy, sell and otherwise deal in goods, wares, materials, articles and merchandise of every nature and kind whatsoever and, without limiting the generality of the foregoing, to manufacture or otherwise produce, buy, sell and deal in plastics and plastic goods and materials, metals, chemicals, minerals, rubber and products thereof, paints, glass, building materials and supplies, bricks, blocks, furniture, wood-work, toys and all kinds of household articles; and to build, purchase, lease or otherwise acquire and establish factories, warehouses, plants, machinery and tools for the manufacture, distribution and sale of all or any of the aforementioned articles and things. (b) To invest in shares, stocks, bonds, debentures and other securities and other evidences of indebtedness and obligations issued or guaranteed by any corporation, company, chartered bank, association, partnership, syndicate, entity, person or governmental, municipal or public authority, domestic or foreign, and evidences of any interest in respect of any such shares, stocks, bonds, debentures, and other securities and other evidences of indebtedness and obligations and to lend money without security or upon the security of personal property and to change, alter or realize upon any investments and to re-invest any moneys which may at any time be available for that purpose; (c) To promote, organize, manage or develop or to assist in the promotion, organization, management or development of any corporation, company, syndicate, firm, partnership, enterprise or undertaking or to take over, manage and dispose of in any manner whatsoever any business or undertaking in which the Corporation may be interested or in the securities of which it may have invested its funds or with which it may have business relations; (d) To purchase or otherwise acquire and hold real and personal property and rights and, in particular, lands, buildings, hereditaments, business or industrial concerns and undertakings, mortgages, charges, contracts, concessions, franchises, annuities, policies, book debts and any interest in real or personal property and any claims against such property or against any person or Corporation, and privileges and choses in action of all kinds; (e) To carry on any other trade or business whatsoever which can, in the opinion of the Board of Directors, be advantageously carried on by the Corporation in connection with or ancillary to any of the above businesses or the general business of the Corporation; (f) It is hereby declared that the objects specified in each of the foregoing clauses shall be regarded as independent objects and accordingly shall in no way be limited or restricted (except where otherwise expressed in such clauses) by reference to or inference from the terms of any other clause or the name of the Corporation, but may be exercised in as full a manner and construed in as wide a sense as if each of the said clauses defines the objects of a separate corporation. PROVIDED however, that the Corporation shall not directly or indirectly transact or undertake any business within the meaning of The Loan and Trust Corporations Act. 3. 6. THE AUTHORIZED CAPITAL IS to be divided into Seventy Thousand (70,000) special shares with a par value of One Dollar ($1.00) each and Thirty Thousand (30,000) common shares without par value; provided that the aggregate consideration for the issue of the said shares without par value shall not exceed in amount or value of the sum of Thirty Thousand Dollars ($30,000.00) or such greater amount as the board of directors of the corporation by resolution determine; and provided further that such resolution shall not be effective until a certified copy thereof has been filed with the Minister of Consumer and Commercial Relations, all prescribed fees have been paid and the Minister has so certified. 4 7. THE DESIGNATIONS, PREFERENCES, RIGHTS, CONDITIONS, RESTRICTIONS, LIMITATIONS OR PROHIBITIONS ATTACHING TO THE SPECIAL SHARES, IF ANY, ARE (a) The holders of the special shares shall in each year in the discretion of the Directors, but always in preference and priority to any payments of dividends for such year on the common shares or on the shares of any other class ranking junior to the special shares, be entitled out of any or all profits or surplus available for dividends, to non-cumulative dividends at the rate of eight cents ($.08) per share and no more; if in any year, after providing for the full dividend on the special shares for such year there shall remain any profits or surplus available for dividends, such profits or surplus or any part thereof may, in the discretion of the Directors, be applied to dividends on the common shares or on the shares of any other class ranking junior to the special shares; the special shares shall not be entitled to any dividend other than or in excess of the non-cumulative dividends at the rate of eight cents ($.08) per share hereinbefore provided for; if within four (4) months from the expiration of any fiscal year of the Corporation the Board of Directors in its discretion shall not declare the said dividend or any part thereof on the said special shares for such fiscal year, then the rights of the holders of the said special shares to such dividend or to any undeclared part thereof for such fiscal year shall be forever extinguished; (b) In the event of the liquidation, dissolution or winding up of the Corporation or other distribution of the assets of the Corporation among its shareholders by way of repayment of capital the holders of the special shares shall be entitled to receive, before any distribution of any part of the assets of the Corporation is made among the holders of the common shares or of the shares of any other class ranking junior to the special shares, the par value of each such special share and any dividends declared thereon and unpaid; after payments to the holders of the special shares of the amount payable to them as aforesaid, they shall not be entitled to any further or other distribution of the property or assets of the Corporation; 4A (c) The Corporation may, upon giving notice as hereinafter provided, redeem all or part of the special shares on payment to the holders thereof, for each share to be redeemed, the par value of each such special share, together with all dividends declared thereon and unpaid; not less than thirty (30) days' notice in writing of such redemption shall be given by mailing such notice to the registered holders of the shares to be redeemed specifying the date and place or places of redemption; if notice of any such redemption be given by the Corporation in the manner aforesaid and an amount sufficient to redeem the shares be deposited with any trust company or chartered bank in Canada, as specified in the notice, on or before the date fixed for redemption, dividends on the special shares to be redeemed shall cease after the date so fixed for redemption and the holders thereof shall thereafter have no rights against the Corporation in respect thereof, except upon the surrender of the certificates for such shares, to receive payment therefor out of the moneys so depsoited; (d) The Corporation may at any time and from time to time purchase for cancellation all or part of the special shares at the lowest price at which in the opinion of the directors, such shares are obtainable on the open market or if the Corporation has requested tenders from the holders of all such special shares, at the lowest tender received by the Corporation, but in any case the purchase price for each such special share shall not exceed the par value thereof plus any dividend thereon and unpaid. Where, in response to the invitation for tenders, two or more shareholders submit tenders at the same price and the tenders are accepted by the Corporation as to part only of the shares offered, the Corporation shall accept part of the shares offered in each tender in proportion as nearly as may be to the total number of shares offered in each tender; (e) The holders of the special shares shall have the right in any year, by instrument in writing, to waive for that year the right to dividends upon the special shares held by them; (f) The holders of special shares shall not, as such, have any voting rights for the election of directors or for any other purpose nor shall they be entitled to attend shareholders' meetings; holders of special shares shall, however, be entitled to notice of meetings of shareholders called for the purpose of authorizing the dissolution of the Corporation or the sale of its undertaking or a substantial part thereof; holders of common shares shall be entitled to one (1) vote for each common shares held by them, at all shareholders' meetings; (g) The authorization required by subsection 4 of Section 189 of The Business Corporations Act, 1970 may be given by resolution passed or confirmed at a meeting of holders of special shares duly called and held upon at least ten (10) days' notice at which the holders of at least a majority of the outstanding special shares are present or represented by proxy and carried by the affirmative votes of the holders of not less than two-thirds (2/3) of the special shares represented and voted at such meeting cast on a poll; if at any such meeting the holders of a majority of the outstanding special shares are not present or represented by proxy within half an hour after the time appointed for the meeting, then the meeting shall be adjourned to such date not being less then ten (10) days later and to such time and place as may be appointed by the Chairman and at least five (5) days' notice shall be given of such adjourned meeting but it shall not be necessary in such notice to specify the purpose for which the meeting was originally called; at such adjourned meeting the holders of special shares present or represented by proxy may transact the business for which the meeting was originally convened and a resolution passed thereat by the affirmative votes of the holders of not less than two-thirds (2/3) of the special shares represented and voted at such adjourned meeting cast on a poll shall constitute the authorization of the holders of special shares referred to above; the formalities to be observed with respect to the giving of notice of any such meeting and the conduct thereof shall be those from time to time prescribed in the by-laws of the Corporation with respect to meetings of shareholders; on every poll taken at every such meeting every holder of special shares shall be entitled to one (1) vote in respect of each special share held. 5 8. THE RESTRICTIONS, IF ANY, ON THE ALLOTMENT, ISSUE OR TRANSFER OF SHARES ARE No shares shall be transferred without the express consent of a majority of the directors, to be signified by a resolution passed by the board. 5.A. 9. THE SPECIAL PROVISIONS, IF ANY, ARE (a) The number of shareholders of the Corporation, exclusive of persons who are in the employment of the Corporation, is hereby limited to fifty (50), two (2) or more persons holding one (1) or more shares jointly being counted as a single shareholder; (b) Any invitation to the public to subscribe for any shares or securities of the Corporation is prohibited; (c) That except in the case of any class or series of shares of the Corporation listed on a stock exchange recognized by the Ontario Securities Commission, the Corporation shall have a lien on the shares registered in the name of a shareholder who is indebted to the Corporation to the extent of such debt; (d) That the Corporation may pay commissions or allow discounts to persons in consideration of their subscribing or agreeing to subscribe, whether absolutely or conditionally, for shares in the Corporation, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for such shares, but no such commission or discount shall exceed twenty-five per cent (25%) of the amount of the subscription price; (e) The Corporation may purchase any of its common shares subject to the provisions of The Business Corporations Act, R.S.O. 1970, Chapter 53, as amended; (f) The Corporation may be dissolved upon the authorization of: (i) the majority of the votes cast at a general meeting of the shareholders of the corporation duly called for the purpose or by at least fifty (50%) per cent of the votes of all shareholders entitled to vote at such meeting; or (ii) the consent in writing of all the shareholders entitled to vote at such meeting; or (iii) all its incorporators or their personal representatives at any time within two (2) years after the date of issuance of its certificate of incorporation where the corporation has not commenced 6 10. THE SHARES, IF ANY, TO BE TAKEN BY THE INCORPORATORS ARE
INCORPORATORS FULL NAMES, NUMBER OF AMOUNT TO INCLUDING ALL GIVEN NAMES SHARES CLASS DESIGNATION BE PAID $ - ------------------------- --------- ------------------- ---------- ~~ALLAN MUIR PATON ------------------N O N E--------------------~~
11. THE NAMES AND RESIDENCE ADDRESSES OF THE INCORPORATORS ARE
FULL RESIDENCE ADDRESS GIVING STREET & NO. OR R.R. NO., MUNICIPALITY FULL NAMES, INCLUDING ALL GIVEN NAMES OR POST OFFICE AND POSTAL CODE - ------------------------------------- -------------------------------------- ~~ALLAN MUIR PATON 1139 Argyle Street Windsor, Ontario N8Y 3K2~~
THESE ARTICLES ARE EXECUTED IN DUPLICATE FOR DELIVERY TO THE MINISTER SIGNATURES OF INCORPORATORS /s/ Allan Muir Paton --------------------- Allan Muir Paton CERTIFICATE 1. [LOGO] Ministry of Consumer and Commercial Ontario Relations THIS IS TO CERTIFY THAT THESE ARTICLES ARE EFFECTIVE ON JANUARY 11, 1983 /s/ [ILLEGIBLE] Trans CONTROLLER OF RECORDS Code. COMPANIES SERVICES BRANCH [C] 18 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ARTICLES OF AMENDMENT FORM 4 1. THE NAME OF THE CORPORATION IS THE BUSINESS ------------------------------------------------------------- CORPORATIONS 450500 ONTARIO LIMITED ACT ------------------------------------------------------------- ------------------------------------------------------------- 2. DATE OF INCORPORATION/AMALGAMATION 4th 07 80 -------------------------- (DAY, MONTH AND YEAR) 3. THE FOLLOWING IS A CERTIFIED COPY OF THE RESOLUTION AMENDING THE ARTICLES OF THE CORPORATION: RESOLVED as a special resolution that the articles of the Corporation are hereby amended to: (a) delete the existing authorized capital of the Corporation; (b) delete the designations, preferences, rights, conditions, restrictions, limitations or prohibitions attaching to the special shares; and declaring that the authorized capital of the Corporation shall be divided into Three Thousand (3,000) common shares without par value; provided that the aggregate consideration for the issue of the said shares without par value shall not exceed in amount or value of the sum of One Million Two Hundred Thousand Dollars ($1,200,000,00) or such greater amount as the board of directors of the Corporation by resolution determine. 4. THE AMENDMENT HAS BEEN DULY AUTHORIZED AS REQUIRED BY SUBSECTIONS 2, 3 AND 4 (AS APPLICABLE) OF SECTION 189 OF THE BUSINESS CORPORATIONS ACT. 5. THE RESOLUTION AUTHORIZING THE AMENDMENT WAS CONFIRMED BY THE SHAREHOLDERS Of THE CORPORATION ON November 26, 1982. 6. THESE ARTICLES ARE EXECUTED IN DUPLICATE FOR DELIVERY TO THE MINISTER. CERTIFIED 450500 ONTARIO LIMITED ----------------------------------- (NAME OF CORPORATION) (CORPORATE SEAL) BY /s/ Robert Edward Tutton ---------------------------------- (SIGNATURE) (DESCRIPTION OF OFFICE) Robert Edward Tutton - President BY /s/ Shirley Mary Tutton ---------------------------------- (SIGNATURE) (DESCRIPTION OF OFFICE) Shirley Mary Tutton - Secretary 17119(04/80) For Ministry Use Only Ontario Corporation Number A l'usage exclusive du ministere Numero de la societe en Ontario [LOGO] Ministry of Ministere des 450500 Consumer and Services aux Business consummateurs Services et aux entreprises CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les presents statuts articles are effective on entrent en vigueur le NOVEMBER 21, 2003 /s/ [ILLEGIBLE] Director/Directrice Business Corporations Act/ Loi sur les societes par actions Form 3 1. The name of the corporation is: (Set out in BLOCK CAPITAL Business LETTERS) Corporation Denomination sociale actuelle de la societe: (Ecrire Act en LETTRES MAJUSCULES SEULEMENT) ------------------------------------------------------------- 450500 ONTARIO LIMITED ------------------------------------------------------------- Formule 3 ------------------------------------------------------------- Loi sur les societe par ------------------------------------------------------------- actions ------------------------------------------------------------- 2. The name of the corporation is changed to (if applicable): (Set out in BLOCK CAPITAL LETTERS) Nouvelle denomination sociale de la societe (s'il y a lieu) (Ecrire en LETTRES MAJUSCULES SEULEMENT) ------------------------------------------------------------- N/A ------------------------------------------------------------- ------------------------------------------------------------- ------------------------------------------------------------- ------------------------------------------------------------- 3. Date of incorporation/amalgamation Date de la constitution ou de la fusion 1980/07/04 ------------------------------------------------------------- (Year, Month, Day) (annee, mois, jour) 4. Complete only if there is a change in the number of directors or the minimum / maximum number of directors. Il faut remplir cette partie seulement si le nombre d'administrateurs ou si le nombre minimal ou maximal d'administrateurs a change Number (or minimum and maximum number) of Number or minimum and maximum directors is/are: Nombre (ou nombres minimal et maximal) d'administrateurs Nombre ou minimal et maximal - ------------------------------------------------------------------------------------------------------------------------ 1 2 ------ ------- -------

5. The articles of the corporation are amended as follow: (Continued next page) Les statuts de la societe sont modifies de la facon suivante: (continuer suite page) see attached schedule 1a 07119(05/2002) SCHEDULE to the Articles of Amendment of 450500 Ontario Limited 1a 1. The Articles of the Corporation are amended as follows: a. to change the number of directors of the Corporation from four (4) to a minimum of one (1) and maximum of five (5). b. to change the number of common shares which the Corporation is authorized to issue from 3,000 common shares to an unlimited number of common shares without par value. c. to delete in their entirety the objects contained in the Articles, so that there will be no restrictions on the business which the Corporation may carry on or on the powers which the Corporation may exercise. d. to delete in their entirety the restrictions on the issue, transfer or ownership of shares contained in the Articles and to substitute the following therefor: No shares shall be transferred without the approval of: (a) the directors of the Corporation, expressed by a resolution of the board of directors; or (b) the shareholders of the Corporation, expressed by a resolution of the shareholders. e. to delete in their entirety the other provisions contained in the Articles and to substitute the following therefor: i) It shall be a condition of these Articles that the number of shareholders of the Corporation, exclusive of persons who are in its employment and exclusive of persons who, having been formerly in the employment of the Corporation were, while in that employment and have continued after the termination of that employment to be shareholders of the Corporation, is limited to not more than 50, 2 or more persons who are the joint registered owners of 1 or more shares being counted as a single shareholder. ii) It shall be a condition of these articles that any invitation to the public to subscribe for securities of the Corporation is prohibited. 2 5. The articles of the corporation are amended as follows: (continued) Les statuts de la societe sont modifies de la facon suivante: (continuation) 6. The amendment has been duly authorized as required by sections 168 and 170 (as applicable) of the Business Corporations Act. La modification a ete dument autorisee conformement aux articles 168 et 170 (selon le cas) de la Loi sur les societes par actions 7. The resolution authorizing the amendment was approved by the shareholders/directors (as applicable) of the corporation on Les actionnaires ou les administrateurs (selon le cas) de la societe ont approuve la reaction autorisant le modification le 2003/10/30 ------------------------------------------------------------- (Year, Month, Day) (annee, mois, jour) These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. 450500 ONTARIO LIMITED ------------------------------------------------------------- (Name of Corporation) (Denomination sociale de la societe) (if the name is to be changed by these articles set out current name) Si l'on demande un changement de nom, indiquer ci-dessous le denomination sociale actuelle By: Par: /s/ David Lawrence David Lawrence - President ------------------------- -------------------------------- (Signature) (Description of Office) (Signature) (Fonction) EX-3.26 24 y98028exv3w26.txt BYLAWS EXHIBIT 3.26 BY-LAW NO. 7 A by-law relating generally to the transaction of the business and affairs of 450500 ONTARIO LIMITED (hereinafter called the "Corporation") SECTION 1 INTERPRETATION 1.01 DEFINITIONS: In this by-law, unless the context otherwise requires: (a) "Act" means the Business Corporations Act, as amended or re- enacted from time to time; (b) "articles" means the original or restated articles of incorporation, articles of amendment, articles of amalgamation, articles of arrangement, articles of continuance, articles of dissolution, articles of reorganization, articles of revival and includes any amendments thereto; (c) "board" means the board of directors of the Corporation; (d) "by-law" means any by-law of the Corporation as from time to time in force and effect; (e) "resident Canadian" means an individual who is, (i) a Canadian citizen ordinarily resident in Canada, (ii) a Canadian citizen not ordinarily resident in Canada who is a member of a prescribed class of persons, or (iii) a permanent resident within the meaning of the Immigration Act (Canada) and ordinarily resident in Canada ("resident canadien"); (f) "unanimous shareholder agreement" means a written agreement among all the shareholders of the Corporation or among all the shareholders and one or more persons who are not shareholders, or a written declaration of the beneficial holder of all of the issued shares of the Corporation that restricts in whole or in part the -2- power of the directors to manage or supervise the management of the business and affairs of the Corporation; (g) All terms contained in the by-laws which are defined in the Act shall have the meanings given to such terms in the Act save as specifically provided herein to the contrary. 1.02 INTERPRETATION: Words importing the singular number only shall include the plural and vice versa; words importing masculine gender shall include the feminine and neuter genders. Wherever reference is made in this or any other by-law or in any special resolution of the Corporation to any statute or section thereof, such reference shall be deemed to extend and refer to any amendment or to re-enactment of such statute or section, as the case may be. SECTION 2 GENERAL 2.01 CORPORATE SEAL: The Corporation may have a corporate seal which the directors may by resolution from time to time adopt. 2.02 FISCAL PERIOD: The fiscal period of the Corporation shall terminate on such day in each year as the board of directors may from time to time by resolution determine. 2.03 EXECUTION OF DOCUMENTS: Contracts, documents, share certificates or any instruments in writing requiring the signature of the Corporation may be signed by any one of the directors or officers of the Corporation and all contracts, documents, share certificates and instruments in writing so signed shall be binding upon the Corporation without any further authorization or formality. Notwithstanding this, the board may at any time and from time to time direct the manner in which and the person or persons by whom any particular deed, transfer, contract or obligation or any class of deeds, transfers, contracts or obligations may be signed. SECTION 3 DIRECTORS 3.01 POWERS: Subject to any unanimous shareholder agreement, the board shall manage, or supervise the management of, the business and affairs of the Corporation. The board may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation and are not by the Act, the articles, the by-laws, a unanimous shareholder agreement, any special resolution of the Corporation or by statute expressly directed or required to be done in some other manner. 3.02 ELECTION AND TERM: Subject to subsection 120(a) of the Act, the election of directors shall take place at the first meeting of shareholders after the effective date of -3- this by-law, and at each succeeding annual meeting at which an election of directors is required. The directors shall hold office for a term expiring not later than the close of the third annual meeting of shareholders following the election. A director not elected for an expressly stated term ceases to hold office at the close of the first annual meeting of shareholders following his election. Incumbent directors, if qualified, shall be eligible for re-election. If an election of directors is not held at the proper time the directors shall continue in office until their successors are elected. SECTION 4 MEETING OF DIRECTORS 4.01 CALLING OF MEETINGS: Meetings of the board shall be held from time to time at such place within or outside Ontario as the Chairman of the Board, the President or a majority of the directors may determine. A meeting of the board may be convened by the Chairman of the Board, the President or any one director at any time and the Secretary shall, upon direction from any of the foregoing, convene a meeting of the board. 4.02 NOTICE OF MEETING: Notice of the time and place of each meeting of the board shall be given in the manner provided in section 9.01 to each director not less than forty-eight hours before the time when the meeting is to be held. A notice of a meeting of directors need not specify the purpose of or the business to be transacted at the meeting except where the Act requires such purpose or business to be specified. A director may in any manner and at any time waive notice of or otherwise consent to a meeting of the board and attendance of a director at a meeting of directors is a waiver of notice of the meeting except where a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called. 4.03 MEETINGS BY TELEPHONE OR ELECTRONIC FACILITIES: If all the directors present at or participating in the meeting consent, a director or all of the directors may participate in a meeting of the board or of a committee of the board by means of such telephone, electronic or other communications facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and any director participating in such a meeting by such means is deemed to be present at the meeting. Any such consent shall be effective whether given before or after the meeting to which it relates and may be given with respect to all meetings of the board and of committees of the board held while a director holds office. For the purpose hereof, participation in a meeting by such means shall be deemed to be such consent. If a majority of the directors participating in such a meeting are then in Canada the meeting shall be deemed to have been held in Canada. 4.04 QUORUM: Subject to any unanimous shareholder agreement, a quorum at any meeting of directors shall be a majority of the directors. -4- 4.05 CHAIRMAN OF MEETINGS: Subject to the provisions of any resolution of the directors specifying the duties of the Chairman of the Board hereof, the President (if he is a director and if he is present), shall preside as chairman at all meetings of the board. In the absence of a President who is a director, the directors present shall choose one of their number to be chairman of the meeting. 4.06 VOTES TO GOVERN: All questions arising at any meeting of directors shall, subject to any unanimous shareholder agreement, be decided by a majority of the votes cast on the question. 4.07 COMMITTEES OF DIRECTORS: Directors may appoint from their number a committee of directors and delegate to such committee any of the powers of the directors except those which, under the Act, a committee of directors has no authority to exercise. If the directors appoint a committee of directors, a majority of the members of the committee must be resident Canadians. The meetings and proceedings of the committee shall be governed by the provisions of the by-laws of the Corporation for regulating the meetings and proceedings of the directors as far as the same are applicable thereto. SECTION 5 OFFICERS 5.01 APPOINTMENT: Subject to the Act and to any unanimous shareholder agreement, the board may from time to time designate the offices of the Corporation, appoint officers, specify their duties and delegate to them powers to manage the business and affairs of the Corporation. None of the officers, except the Chairman of the Board, if any, need be a director of the Corporation. Two or more offices of the Corporation may be held by the same person. 5.02 CHAIRMAN OF THE BOARD: The Chairman of the Board (if any) shall, when present, preside at all meetings of the directors and shareholders and of any committee of directors; he shall sign such contracts, documents or instruments in writing as may require his signature in accordance with the by-laws and shall have such other powers and duties as may from time to time be assigned to him by the board of directors. 5.03 PRESIDENT: If appointed, the President shall be the chief executive officer of the Corporation and, subject to the authority of the board, shall exercise general supervision of the business and affairs of the Corporation; and he shall have such other powers and duties as the board may specify. In the absence of the Chairman of the Board, if any, the President shall, when present, chair all meetings of the directors and the shareholders and of any committee of directors. 5.04 VICE-PRESIDENT: In the absence or disability or refusal to act of the President, a Vice-President may be vested with all the powers and may perform all the duties of the President, or if there is more than one Vice-President, by the Vice-President -5- in order of seniority or designation (as determined by the board), except that no Vice-President shall preside at a meeting of the board unless he is also a director. 5.05 SECRETARY: The Secretary shall attend and be the Secretary of all meetings of the board, shareholders and committees of the board and shall enter or cause to be entered in records kept for that purpose minutes of all proceedings thereat; he shall give or cause to be given, as and when instructed, all notices to shareholders, directors, officers, auditors and members of committees of the board; he shall be the custodian of all books, papers, records, documents and instruments belonging to the Corporation, except when some other officer or agent has been appointed for that purpose; and he shall have such other powers and duties as the board may specify. 5.06 TREASURER: The Treasurer shall keep or cause to be kept proper accounting records in compliance with the Act and shall be responsible for the deposit of money, the safekeeping of securities and the disbursement of the funds of the Corporation; he shall render to the board whenever required an account of all his transactions as Treasurer and of the financial position of the Corporation; and he shall have such other powers and duties as the board may specify or as are incident to his office. 5.07 MANAGING DIRECTOR: The directors may appoint from their number a managing director who is a resident Canadian and, subject to the Act and any unanimous shareholder agreement, may delegate to such managing director any of the powers of the board. SECTION 6 PROTECTION OF DIRECTORS, OFFICERS AND OTHERS 6.01 LIMITATION OF LIABILITY: Every director and officer of the Corporation in exercising their powers and discharging their duties shall act honestly and in good faith with a view to the best interest of the Corporation and shall exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. Subject to the foregoing, no director or officer shall be liable for the acts, omissions, failures, neglects or defaults of any other director, officer or employee, or for joining in any act for conformity, or for any loss, damage or expense suffered or incurred by the Corporation through the insufficiency or deficiency of title to any property acquired by the Corporation or for or on behalf of the Corporation, or for the insufficiency or deficiency of any security in or upon which any of the moneys of the Corporation shall be invested, or damage arising from the bankruptcy, insolvency, or tortious act of any person with whom any of the moneys, securities or effects of the Corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his or her part, or for any other loss, damage or misfortune which shall happen in the execution of the duties of his or her office or in relation thereto. Nothing herein shall relieve any director or officer from the duty to act in accordance with the Act and the regulations thereunder or from liability for any breach thereof. -6- 6.02 INDEMNITY: Subject to the limitations contained in the Act, the Corporation shall indemnify a director or officer, a former director or officer of the Corporation, or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor and his heirs or legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of the Corporation or such body corporate, if: (a) he acted honestly and in good faith with a view to the best interests of the Corporation; and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful. 6.03 RIGHT TO INDEMNIFICATION: The Corporation shall also indemnify an individual referred to in section 6.02 in such other circumstances as the Act or law permits or requires. Nothing in these by-laws shall limit the right of any person entitled to indemnity to claim indemnity apart from the provisions of these by-laws. 6.04 INSURANCE: Subject to the limitations contained in the Act, the Corporation may purchase and maintain insurance for the benefit of any individual referred to in section 6.02 as the board may from time to time determine. SECTION 7 MEETINGS OF SHAREHOLDERS 7.01 CALLING OF MEETINGS: The directors of the Corporation shall call an annual meeting of shareholders not later than eighteen (18) months after the Corporation comes into existence and subsequently not later than fifteen (15) months after holding the last preceding annual meeting. The directors of the Corporation may at any time call a special meeting of shareholders. The Secretary shall cause notice of a meeting of shareholders to be given in accordance with section 7.03 hereof when directed to do so by the board or the President. 7.02 PLACE OF MEETINGS: Subject to the articles and any unanimous shareholder agreement, meetings of shareholders shall be held at such place in or outside Ontario as the directors determine or at the registered office of the Corporation. 7.03 NOTICE OF MEETINGS: Notice of the time and place of each meeting of shareholders shall be given by the Secretary of the Corporation in the manner provided in section 9.01 hereof not less than ten (10), nor more than fifty (50) days before the date of -7- the meeting to each director, to the auditor and to each shareholder entitled to vote at the meeting. A shareholder may in any manner and at any time waive notice of or otherwise consent to a meeting of shareholders. 7.04 MEETINGS WITHOUT NOTICE: A meeting of shareholders may be held without notice at any time and place permitted by the Act: (a) if all the shareholders entitled to vote thereat are present in person or represented by proxy or if those not present or represented by proxy waive notice of or otherwise consent to such meeting being held; and (b) if the auditors and the directors are present or waive notice of or otherwise consent to such meeting being held. At such a meeting any business may be transacted which the Corporation at a meeting of shareholders may transact. 7.05 MEETINGS BY ELECTRONIC MEANS: A meeting of shareholders may be held by telephone or electronic means and a shareholder who, through those means, votes at the meeting or establishes a communications link to the meeting shall be deemed to be present at the meeting. 7.06 CHAIRMAN AND SECRETARY: Subject to the provisions of this section and of section 5.02 hereof, the President shall preside as chairman at each meeting of the shareholders. In the event that the President is not present within fifteen (15) minutes from the time fixed for holding the meeting, or is unable or refuses to preside as Chairman at such meeting, the persons present and entitled to vote shall choose one of their number to be chairman. The Secretary shall be the secretary of any meeting of shareholders. If the Secretary is absent, the chairman shall appoint some person, who need not be a shareholder, to act as Secretary of the meeting. 7.07 PERSONS ENTITLED TO BE PRESENT: The only persons entitled to be present at a meeting of the shareholders shall be those entitled to vote thereat, the directors and auditors of the Corporation and others who, although not entitled to vote, are entitled or required under any provision of the Act or the articles or by-laws to be present at the meeting. Any other person may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting. 7.08 QUORUM: Subject to any unanimous shareholder agreement, the holders of a majority of the shares entitled to vote at a meeting of shareholders, whether present in person or represented by proxy, constitute a quorum, irrespective of the number of persons actually present at the meeting. No business shall be transacted at any meeting while a quorum is not present. If the Corporation has only one (1) shareholder or only one (1) shareholder of any class or series of shares, the shareholder present in person or represented by proxy constitutes a meeting. -8- 7.09 PROXIES: Every shareholder entitled to vote at a meeting of shareholders may appoint a proxyholder, or one or more alternate proxyholders, who need not be shareholders as the shareholder's nominee, to attend and act at the meeting in the manner, to the extent authorized and with the authority conferred by the proxy. A proxy shall be in writing executed by the shareholder or his duly appointed attorney and shall conform with the requirements of the Act. 7.10 VOTES TO GOVERN: At any meeting of shareholders every question shall, unless otherwise required by the Act, the articles, by-laws or any unanimous shareholder agreement, be determined by the majority of the votes cast on the question. 7.11 SHOW OF HANDS: Subject to the provisions of the Act, any question at a meeting of shareholders shall be decided by a show of hands unless a ballot thereon is required or demanded as hereinafter provided. Whenever a vote by show of hands shall have been taken upon a question, unless a ballot thereon is so required or demanded, a declaration by the chairman of the meeting that the vote upon the question has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting shall be prima facie evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against any resolution or other proceeding in respect of the said question, and the result of the vote so taken shall be the decision of the shareholders upon the said question. 7.12 BALLOTS: On any question proposed for consideration at a meeting of shareholders, and whether or not a show of hands has been taken thereof, any shareholder or proxyholder entitled to vote at the meeting may require or demand a ballot. A ballot so required or demanded shall be taken in such manner as the chairman shall direct except if the ballot be demanded on the election of a chairman or on the question or adjournment or termination, in which event the ballot shall be taken forthwith without adjournment. A requirement or demand for a ballot may be withdrawn at any time prior to the taking of the ballot. If a ballot is taken, each person present shall be entitled, in respect of the shares which he is entitled to vote at the meeting upon the question, to that number of votes provided by the Act or the articles, and the result of the ballot so taken shall be the decision of the shareholders upon the said question. SECTION 8 SHARES AND TRANSFERS 8.01 LIEN FOR INDEBTEDNESS: If the articles of the Corporation provide that the Corporation has a lien on a share or shares registered in the name of a shareholder or the shareholder's personal representative for a debt of that shareholder to the Corporation, the right of the Corporation to the lien shall be noted conspicuously on every security certificate. The directors may refuse to permit the registration of a transfer of any share or share of the Corporation registered in the name of a shareholder who is indebted to the Corporation. Subject to the Act, the directors of the Corporation may -9- apply any dividends or other distributions paid or payable on or in respect of the share or shares in respect of which the Corporation has such a lien in repayment of the debt of that shareholder to the Corporation. 8.2 TRANSFER OF SHARES: Subject to the provisions of the Act and subject to the restrictions on transfer (if any) set forth in the articles, by-laws and any unanimous shareholder agreement, shares of the Corporation shall be transferable on the books of the Corporation upon surrender of the certificate representing such shares properly endorsed or accomplished by a properly executed transfer. 8.3 DEFACED, DESTROYED, STOLEN OR LOST CERTIFICATES: Where the owner of a share or shares of the Corporation claims that the certificate for such share or shares has been defaced, lost, apparently destroyed or wrongfully taken, the Corporation shall issue a new share certificate in place of the original share certificate on such terms as to indemnity, reimbursement of expenses and evidence of loss and of title as the board may from time to time prescribe, whether generally or in any particular case. SECTION 9 NOTICES 9.01 METHOD OF GIVING NOTICE: Any notice, communication or other document to be given by the Corporation to a shareholder, director, officer, or auditor of the Corporation under any provision of the Act, the articles or by-laws shall be sufficiently given if delivered personally to the person to whom it is to be given or if delivered to his latest address as shown in the records of the Corporation or if mailed by prepaid ordinary mail or airmail in a sealed envelope addressed to him at his latest address as shown in the records of the Corporation or if sent by any means of any telephonic, electronic or other communication facility. The Secretary may change the address on the records of the Corporation of any shareholder that produces a written copy in accordance with any information believed by him to be reliable. A notice, communication or document so delivered shall be deemed to have been given when it is delivered personally or at the address aforesaid. A notice, communication or document so mailed shall be deemed to have been given on the fifth day after it is deposited in a post office or public letter box. A notice sent by any means of electronic or recorded telephonic communication shall be deemed to have been given when delivered to the appropriate communication corporation or agency or its representative for dispatch. SECTION 10 MISCELLANEOUS 10.01 EFFECTIVE DATE: These by-laws shall come into force when made by the board and confirmed by the shareholders in accordance with the Act. -10- 10.02 PARAMOUNTCY: In the event of any conflict between any provision of these by-laws and any unanimous shareholder agreement, the provisions of the unanimous shareholder agreement shall prevail to the extent of the conflict, and the directors and the shareholders shall amend these by-laws accordingly. PASSED this 30th day of October 2003 WITNESS the corporate seal of the Corporation. /s/ David Lawrence -------------------------------- President- David Lawrence EX-3.27 25 y98028exv3w27.txt ARTICLES OF INCORPORATION EXHIBIT 3.27 [ONTARIO LOGO] Ministry of CERTIFICATE 528650 Consumer and Commercial Relations THIS IS TO CERTIFY THAT THESE ARTICLES ARE EFFECTIVE ON NOVEMBER 24, 1982 - ---------------------------- /s/ [ILLEGIBLE] -------------------------- CONTROLLER OF RECORDS COMPANIES SERVICES BRANCH Trans Line Comp Method Code No. Stat Type Incorp. [A] [0] [0] [A] [3] 18 20 26 29 30 Notice Jurisdiction Share Req'd [ONTARIO] [S] [N] 33 47 31 32 ARTICLES OF INCORPORATION Form 1 1. THE NAME OF THE CORPORATION IS The Business 528650 ONTARIO LIMITED Corporations 2. THE ADDRESS OF THE HEAD OFFICE IS Act 78 Sir Lancelot Drive, -------------------------------------------------------------- (Street & Number of R. R. Number & if Multi-Office Building give Room No.) Markham, Ontario L3P2J2 -------------------------------------------------------------- (Name of Municipality or Post Office) (Postal Code) Town of Markham in the Regional Municipality of York ---------------------- ----------------------------- (Name of Municipality, (County, District, Regional Geographical Township) Municipality) 3. THE NUMBER OF DIRECTORS IS TWO 4. THE FIRST DIRECTOR(S) IS/ARE RESIDENCE ADDRESS, GIVING STREET NAME IN FULL, INCLUDING & NO. OR R.R. NO. & MUNICIPALITY ALL GIVEN NAMES OR POST OFFICE AND POSTAL CODE ----------------------- -------------------------------- Ronald Parent 78 Sir Lancelot Drive, Markham, Ontario L3P 2J2 Wendy Parent 78 Sir Lancelot Drive, Markham, Ontario L3P 2J2 2A (h) To buy, hold, own, hire, maintain, control, take, lease, sell, assign, exchange, transfer, manage, improve, develop, pledge, mortgage or otherwise deal in and dispose of, either absolutely as owner or by way of collateral security or otherwise, any property, real and personal, movable and immovable, and assets generally; (i) To purchase, lease, take in exchange or otherwise acquire lands or interests therein, together with any buildings or structures that may be on the said lands or any of them, and to sell, lease, exchange, mortgage or otherwise dispose of the whole or any portion of the lands and all or any of the buildings or structures that are now or may hereafter be erected thereon, and to take such security therefor as may be deemed necessary or desirable; (j) To erect buildings, and to deal in building material; (k) To take or hold mortgages for any unpaid balance of the purchase money on any of the lands, buildings or structures so sold, and to sell, mortgage or otherwise dispose of the said mortgages; (l) To improve, alter and manage the said lands and buildings; (m) To guarantee and otherwise assist in the performance of contracts or mortgages of persons, firms or corporations with whom or which the Corporation may have dealings, and to assume and take over such contracts or mortgages on default; (n) To prepare building sites, and to construct, reconstruct, alter, improve, decorate, furnish and maintain offices, flats, houses, factories, warehouses and lands, and to consolidate, connect or subdivide properties; PROVIDED, HOWEVER, that it shall not be lawful for the Corporation hereby incorporated directly or Indirectly to transact or undertake any business within the meaning of The Loan and Trust Corporations Act. 3 6. THE AUTHORIZED CAPITAL is to be divided into 10,000 Class "A" Preference Shares with a par value of $1.00 each; 10,000 Class "B" Preference Shares with a par value of $1.00 each; 250 Class "C" Preference Shares with a par value of $100.00 each and 10,000 Common Shares without nominal or par value provided, however, that the aggregate consideration for the issue of the said shares without nominal or par value shall not exceed in amount or value the sum of $10,000,00 or such greater amount as the Board of Directors of the Corporation shall by resolution determine, provided, that such resolution shall not be effective until a certified copy thereof has been filed with the Ministry of Consumer and Commercial Relations, all prescribed fees have been paid and the Minister has so certified. 4 7. THE DESIGNATIONS, PREFERENCES, RIGHTS, CONDITIONS, RESTRICTIONS, LIMITATIONS OR PROHIBITIONS ATTACHING TO THE SPECIAL SHARES, IF ANY, ARE (a) The Class A Preference Shares shall carry the right to a fixed non-cumulative preferential dividend at the rate of eight per cent (8%) per annum, payable yearly, to be declared and paid before any dividend is declared or paid on the Class B Preference Shares, the Class C Preference Shares or on the Common Shares and the right in the liquidation or winding up of the Corporation to repayment of capital in priority to the Class B Preference Shares, the Class C Preference Shares and the Common Shares, but they shall not confer the right to any further participation in profits or assets. Each Class A Preference Share entitles the holder to repayment of capital in an amount equal to the par value thereof provided, however, in the event the aggregate amount available for the repayment of capital is not sufficient to pay the par value thereof, then Class A Preference Shares shall entitle the holders thereof to participate rateably in the aggregate amount available for repayment of capital; (b) The said Class A Preference Shares or any part thereof shall be redeemable at any time at the option of the Corporation without the consent of the holders thereof on payment for each share to be redeemed of the par value thereof together with all unpaid non-cumulative dividends, which have been previously declared; (c) The Corporation may at any time or times purchase for cancellation the whole or any part of the Class A Preference Shares outstanding from time to time at the lowest price at which in the opinion of the Directors, such shares are obtainable, but not exceeding the par value thereof, together with all unpaid non-cumulative dividends, which have previously been declared; (d) The Class B Preference Shares shall carry the right to a fixed non-cumulative dividend at the rate of eight per cent (8%) per annum, payable yearly, to be declared and paid after the dividend is declared and paid on the Class A Preference Shares but before any dividends are declared and paid on the Class C Preference Shares or on the Common Shares and the right in the liquidation or winding up of the Corporation to repayment of capital in priority to the Class C Preference Shares and the Common Shares, but after the Class A Preference Shares, but they shall not confer the right to any further participation in profits or assets. Each Class B Preference Share entitles the holder to repayment of capital in an amount equal to the par value thereof, provided, however, in the event the aggregate amount available for the repayment of capital is not sufficient to pay the par value thereof, then each Class B Preference Share entitles the holder thereof to participate rateably in the aggregate amount available for repayment of capital thereon; (e) The Class B Preference Shares or any part thereof shall be redeemable at any time at the option of the Corporation without the consent of the holders thereof on payment for each share to 4A be redeemed of the par value thereof together with all unpaid non-cumulative dividends which have previously been declared; (f) At any time or times the Corporation may purchase for cancellation the whole or any part of the Class B Preference Shares outstanding from time to time, at the lowest price at which, in the opinion of the Directors, such shares are obtainable but not exceeding the par value thereof, together with all unpaid non-cumulative dividends which have previously been declared. (g) The said Class C Preference Shares or any part thereof shall be redeemable at any time at the option of the Corporation without the consent of the holders thereof on payment for each share to be redeemed of the par value thereof together with all unpaid non-cumulative dividends, which have been previously declared; (h) The Corporation may at any time or times purchase for cancellation the whole or any part of the Class C Preference shares outstanding from time to time at the lowest price at which, in the opinion of the Directors, such shares are obtainable, but not exceeding the par value thereof, together with all unpaid non-cumulative dividends, which have previously been declared; (i) The Class C Preference Shares shall carry the right to a fixed non-cumulative dividend at the rate of eight per cent (8%) per annum, payable yearly, to be declared and paid after the divided is declared and paid on the Class A Preference Shares and the Class B Preference Shares but before any dividends are declared and paid on the Common Shares and the right in the liquidation or winding up of the Corporation to repayment of capital in priority to the Common Shares but after the Class A Preference Shares and the Class B Preference Shares, but they shall not confer the right to any further participation in profits or assets. Each Class C Preference Share entitles the holder to repayment of capital in an amount equal to the par value thereof, provided, however, in the event the aggregate amount available for the repayment of capital is not sufficient to pay the par value thereof, then each Class C Preference Share entitles the holder thereof to participate rateably in the aggregate amount available for repayment of capital thereon; (j) In the event of the liquidation, dissolution or winding up of the Corporation, the reduction of capital or other distribution of its assets among shareholders by way of replacement of capital, the holders of Class A Preference Shares shall be entitled to receive the amount paid up thereon, together with all unpaid dividends which shall have been declared thereon in priority to any distribution to the holders of Class B Preference Shares, the Class C Preference Shares and the Common Shares, without any right to any further participation in profits or assets; 4B (k) In the event of the liquidation, dissolution or winding up of the Corporation, the reduction of capital or other distribution of its assets among shareholders by way of replacement of capital, the holders of Class B Preference Shares shall be entitled to receive the amount paid up thereon together with all unpaid dividends which shall have been declared thereon after payment to the holders of the Class A Preference Shares but in priority to any distribution to the holders of Class C Preference Shares and Common Shares, without any right to any further participation in profits or assets; (l) In the event of the liquidation, dissolution or winding up of the Corporation, the reduction of capital or other distribution of its assets among shareholders by way of repayment of capital, the holders of Class C Preference Shares shall be entitled to receive the amount paid up thereon, together with all unpaid dividends which shall have been declared thereon, after payment to the holders of the Class A Preference Shares and the Class B Preference Shares but in priority to any distribution to holders of Common Shares; and after the holders of the Common Shares shall have received one dollar ($1.00) for each common share held together with all unpaid dividends which shall have been declared, the holders of the Class C Preference Shares and holders of the Common Shares shall thereafter be entitled to share pari passu in any further distribution of the property or assets of the Corporation; (m) The holders of the Class B Preference Shares and the Class C Preference Shares shall not be entitled to vote at any meetings of the shareholders of the Corporation but shall be entitled to notice of meetings of shareholders called for the purpose of authorizing the dissolution of the Corporation or the sale of its undertaking or a substantial part thereof; holders of Class A Preference Shares and Common Shares shall on the record date for voting be entitled to one (1) vote at all meetings of the shareholders for each Class A Preference Share or Common Share held by them respectively; (n) The authorization to amend the Articles of the Corporation to delete or vary any preference, right, condition, restriction, limitation or prohibition attaching to the Class A Preference Shares, Class B Preference Shares or Class C Preference Shares or to create preference shares ranking in priority to or on a parity with the Class A Preference Shares, Class B Preference Shares or Class C Preference Shares, In addition to the authorization by a special resolution, may be given by at least two-thirds (2/3) of the votes cast at a Meeting of the holders of the Class A Preference Shares, Class B Preference Shares or Class C Preference Shares as the case may be, duly called for that purpose. 5 8. THE RESTRICTIONS, IF ANY, ON THE ALLOTMENT, ISSUE OR TRANSFER OF SHARES ARE The right to transfer shares of the Corporation shall be restricted in that no shareholder shall be entitled to transfer any share or shares of the Corporation without either: (a) The previous express sanction of the shareholders of the Corporation to be signified by a resolution passed by the shareholders or by an instrument or instruments in writing signed by all of the Shareholders; or (b) The previous express sanction of the Board of Directors of the Corporation expressed by a resolution passed by the Board of Directors or by an instrument or instruments in writing signed by all of the Directors. 6 9. THE SPECIAL PROVISIONS, IF ANY, ARE (a) The number of shareholders of the Corporation, exclusive of persons who are in the employment of the Corporation, is hereby limited to 50, 2 or more persons holding 1 or more shares jointly being counted as a single shareholder; (b) Any invitation to the public to subscribe for any shares or securities of the Corporation is hereby prohibited; (c) The Corporation may purchase any of its common shares out of surplus. 7 10. THE SHARES, IF ANY, TO BE TAKEN BY THE INCORPORATORS ARE INCORPORATORS FULL NAMES, NUMBER OF CLASS DESIGNATION AMOUNT INCLUDING ALL GIVEN NAMES SHARES BE PAID NIL 11. THE NAMES AND RESIDENCE ADDRESSES OF THE INCORPORATORS ARE FULL RESIDENCE ADDRESS GIVING STREET & NO. OR R.R. NO., MUNICIPALITY FULL NAMES, INCLUDING ALL GIVEN NAMES OR POST OFFICE AND POSTAL CODE - ------------------------------------- -------------------------------------- Ronald Parent 78 Sir Lancelot Drive, Markham, Ontario L3P 2J2 Wendy Parent 78 Sir Lancelot Drive, Markham, Ontario L3P 2J2 THESE ARTICLES ARE EXECUTED IN DUPLICATE FOR DELIVERY TO THE MINISTER SIGNATURES OF INCORPORATORS /s/ Ronald Parent ---------------------------- Ronald Parent /s/ Wendy Parent ---------------------------- Wendy Parent For Ministry Use Only l'Usage exclusif du ministere Ontario Corporation Number Numero de la compagnie en Ontario 528650 FEBRUARY 27 FEVRIER, 1984 TRANS CODE [C] - -------------------------------------------------------------------------------- ARTICLES OF AMENDMENT STATUTS DE MODIFICATION FORM 3 1. The present name of the Denomination sociale Business corporation is: actuelle de la compagnie: Corporations Act. 1982 528650 ONTARIO LIMITED -------------------------------------------------------------- [ILLEGIBLE] -------------------------------------------------------------- -------------------------------------------------------------- Formule 2. The name of the corporation is Nouvelle denomination numero 3 changed to (if applicable): N/A sociale de la compagnie Loi de 1982 (s'il y a lieu): sur les compagnies -------------------------------------------------------------- -------------------------------------------------------------- -------------------------------------------------------------- -------------------------------------------------------------- 3. Date of incorporation/amalgamation: Date de la constitution ou de la fusion: November 24, 1982 -------------------------------------------------------------- (Day, month, Year) (jour, mois, annee) 4. The articles of the corporation Les statuts de la compagnie are amended as follows: sont modifies de la facon suivante: 1. To remove any restrictions on the business that the Corporation may carry on or on the powers the Corporation may exercise and, without limiting the generality of the foregoing, to delete the objects contained in the Articles of the Corporation; 2. To provide that the number of Directors of the Corporation shall be a minimum of one and a maximum of five; 3. To change the number of shares that the Corporation is authorized to issue by: 1A (a) Changing the unissued 9,990 Class "A" Preference Shares with a par value of $1.00 each into an unlimited number of Class "A" Preference Shares without par value; (b) Changing the 10 issued and outstanding Class "A" Preference Shares with a par value of $1.00 each into 10 issued and outstanding Class "A" Preference Shares without par value; (c) Changing the unissued 9,990 Class "B" Preference Shares with a par value of $1.00 each into an unlimited number of Class "B" Preference Shares without par value; (d) Changing the 10 issued and outstanding Class "B" Preference Shares with a par value of $1.00 each into 10 issued and outstanding Class "B" Preference Shares without par value; (e) Changing the unissued 250 Class "C" Preference Shares with a par value of $100.00 each into an unlimited number of Class "C" Preference Shares without par value; (f) Changing the maximum number of Common Shares that the Corporation is authorized to issue from 10,000 Common Shares to an unlimited number of Common Shares and removing the maximum consideration for which the Common Shares may be issued; (g) Declaring that the Corporation is authorized to issue an unlimited number of Class "A" Preference Shares without par value, an unlimited number of Class "B" Preference Shares without par value, an unlimited number of Class "C" Shares without par value and an unlimited number of Common Shares without par value; 4. To delete clauses 7(a), (b), (c), (d), (e), (f), (g), (h), (i), (j), (k),(l), (m) and (n), being the designations preferences, rights, conditions, restrictions, limitations or prohibitions attaching to the Preference Shares as set out in the Articles of the Corporation and to substitute the following rights, privileges, restrictions and conditions therefor: (a) The holders of the Class A Preference Shares, the Class B Preference Shares and the Class C Preference Shares may in each year in the discretion of the Directors be entitled out of any or all profits or surplus available for dividends, to non-cumulative dividends per share as may be determined by the Directors in their absolute discretion, and in preference or 1B priority to any payment of dividends on the common shares for such year; conversely, in any year, the Directors, in their absolute discretion, may declare dividends on the Common Shares in such amount as they in their absolute discretion may determine, in lieu of or in preference or priority to any payment of dividends on the Class A Preference Shares, the Class B Preference Shares or the Class C Preference Shares; or the Directors, in their absolute discretion, may declare dividends on the Class A Preference Shares, the Class B Preference Shares and the Class C Preference Shares and the Common Shares in such priority as they deem desirable; the holders of the Class A Preference Shares, the Class B Preference Shares and the Class C Preference Shares shall not be entitled to any dividend other than or in excess of the non-cumulative dividends as hereinbefore provided for; (b) The Class A Preference Shares shall carry the right in the liquidation or winding up of the Corporation to repayment of capital in priority to the Class B Preference Shares, the Class C Preference Shares and the Common Shares, but they shall not confer the right to any further participation in profits or assets. Each Class A Preference Share entitles the holder to repayment of capital in an amount equal to the amount paid to the Corporation for each Class A Preference Share, provided however, in the event the aggregate amount available for the repayment of capital is not sufficient to pay an amount equal to the amount paid to the Corporation for each Class A Preference Share, then Class A Preference Shares shall entitle the holders thereof to participate rateably in the aggregate amount available for repayment of capital; (c) The Class A Preference Shares or any part thereof shall be redeemable at any time at the option of the Corporation without the consent of the holders thereof on payment for each share to be redeemed of an amount equal to the amount paid to the Corporation for each Class A Preference Share, together with all unpaid non-cumulative dividends, which have been previously declared; (d) The Corporation may at any time or times purchase for cancellation the whole or any part of the Class A Preference Shares outstanding from time to time at the lowest price at which in the opinion of the Directors, such shares are obtainable, but not exceeding an amount equal to the amount paid to the Corporation for such Class A Preference Shares, together with all unpaid non-cumulative dividends, which have been previously been declared; (e) The Class B Preference shares shall carry the right in the liquidation or winding up of the Corporation to repayment of capital in priority to the Class C Preference Shares and the Common Shares, but after the Class A Preference Shares, but they 1C shall not confer the right to any further participation in profits or assets. Each Class B Preference Share entitles the holder to repayment of capital in an amount equal to the amount paid to the Corporation for each Class B Preference Share, provided, however, in the event the aggregate amount available for the repayment of capital is not sufficient to pay an amount equal to the amount paid to the Corporation for each Class B Preference Share, then each Class B Preference Share entitles the holder thereof to participate rateably in the aggregate amount available for repayment of capital thereon; (f) The Class B Preference Shares or any part thereof shall be redeemable at any time at the option of the Corporation without the consent of the holders thereof on payment for each share to be redeemed of an amount equal to the amount paid to the Corporation for each Class B Preference Share, together with all unpaid non-cumulative dividends which have previously been declared; (g) At any time or times the Corporation may purchase for cancellation the whole or any part of the Class B Preference Shares outstanding from time to time, at the lowest price at which, in the opinion of the Directors, such shares are obtainable but not exceeding an amount equal to the amount paid to the Corporation for each Class B Preference Share, together with all unpaid non-cumulative dividends which have previously been declared; (h) The said Class C Preference Shares or any part thereof shall be redeemable at any time at the option of the Corporation without the consent of the holders thereof on payment for each share to be redeemed of an amount equal to the amount paid to the Corporation for each Class C Preference Share, together with all unpaid non-cumulative dividends which have been previously declared; (i) The Corporation may at any time or times purchase for cancellation the whole or any part of the Class C Preference Shares outstanding from time to time at the lowest price at which, in the opinion of the Directors, such shares are obtainable, but not exceeding an amount equal to the amount paid to the Corporation for each Class C Preference Share, together with all unpaid non-cumulative dividends, which have previously been declared; (j) In the event of the liquidation, dissolution or winding up of the Corporation, the reduction of capital or other distribution of its assets among shareholders by way of replacement of capital, the holders of Class A Preference 1D Shares shall be entitled to receive an amount equal to the amount paid to the Corporation for each Class A Preference Share, together with all unpaid dividends which shall have been declared thereon in priority to any distribution to the holders of Class B Preference Shares, the Class C Preference Shares and the Common Shares, without any right to any further participation in profits or assets; (k) In the event of the liquidation, dissolution or winding up of the Corporation, the reduction of capital or other distribution of its assets among shareholders by way of replacement of capital, the holders of Class B Preference Shares shall be entitled to receive an amount equal to the amount paid to the Corporation for each Class B Preference Share, together with all unpaid dividends which shall have been declared thereon after payment to the holders of the Class A Preference Shares but in priority to any distribution to the holders of Class C Preference Shares and Common Shares, without any right to any further participation in profits or assets; (l) In the event of the liquidation, dissolution or winding up of the Corporation, the reduction of capital or other distribution of its assets among shareholders by way of repayment of capital, the holders of Class C Preference Shares shall be entitled to receive an amount equal to the amount paid to the Corporation for each Class C Preference Share, together with all unpaid dividends which shall have been declared thereon, after payment to the holders of the Class A Preference Shares and the Class B Preference Shares but in priority to any distribution to holders of Common Shares; and after the holders of the Common Shares shall have received an amount equal to the amount paid to the Corporation for each Common Share, together with all unpaid dividends which shall have been declared, the holders of the Class C Preference Shares and holders of the Common Shares shall thereafter be entitled to share pari passu in any further distribution of the property or assets of the Corporation; (m) The holders of the Class B Preference Shares and the Class C Preference Shares shall not be entitled to vote at any meetings of the shareholders of the Corporation but shall be entitled to notice of meetings of shareholders called for the purpose of authorizing the dissolution of the Corporation or the sale of its undertaking or a substantial part thereof; holders of Class A Preference Shares and Common Shares shall on the record date for voting be entitled to one vote at all meetings of the shareholders for each Class A Preference Share or Common Share held by them respectively; 1E (n) The authorization to amend the Articles of the Corporation to delete or vary any preference, right, condition, restriction, limitation or prohibition attaching to the Class A Preference Shares, Class B Preference Shares or Class C Preference Shares or to create preference shares ranking in priority to or on a parity with the Class A Preference Shares, Class B Preference Shares or Class C Preference Shares, in addition to the authorization by a special resolution, may be given by at least two-thirds (2/3) of the votes cast at a meeting of the holders of the Class A Preference Shares, Class B Preference Shares or Class C Preference Shares as the case may be, duly called for that purpose. 2 5. The amendment has been duly authorized as required by Sections 167 and 169 (as applicable) of the Business Corporations Act. La modification a ete dument autorisee conformement a l'article 167 et, s'il y a lieu, a l'article 169 de la Loi sur les compagnies. 6. The resolution authorizing the amendment was approved by the shareholders/directors (as applicable) of the corporation on Les actionnaires ou les administrateurs (le cas echeant) de la compagnie ont approuve la resolution autorisant la modification February 15, 1984 - -------------------------------------------------------------------------------- (Day, Month, Year) (jour, mois, annee) These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. 528650 ONTARIO LIMITED -------------------------------- (Name of Corporation) Denomination sociale de la compagnie By/Par: Ronald Parent President -------------------------------- (Signature) (Description of Office) (Signature) (Fonction) 1 For Ministry Use Only Ontario Corporation Number A l'usage exclusif du ministere Numero de la compagnie en Ontario [LOGO] Ministry of Ministere de 528650 Consumer and la Consommation Commercial et du Commerce Relations CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les presents articles are effective on statuts entrent en vigueur le NOVEMBER 23 NOVEMBRE, 1988 /s/ [ILLEGIBLE] - -------------------- Director Le Directeur TRANS Companies Branch Direction des Compagnies CODE [C] 18 ARTICLES OF AMENDMENT STATUTS DE MODIFICATION Form 3 1. The present name of the Denomination sociale actuelle Business corporation is: de la compagnie: Corporations Act 528650 ONTARIO LIMITED 1982 -------------------------------------------------------------- -------------------------------------------------------------- Formule -------------------------------------------------------------- numero 3 Loi de 1962 2. The name of the Nouvelle denomination sociale sur les corporation is changed de la compagnie (s'il y a lieu): compagnies to (if applicable): N/A -------------------------------------------------------------- -------------------------------------------------------------- -------------------------------------------------------------- 3. Date of incorporation/ Date de la constitution ou de la amalgamation: fusion: NOVEMBER 24, 1982 ----------------------------------------------------------------- [Day, Month, Year] (jour, mois, annee) 4. The articles of the Les statuts de la compagnie sont corporation are amended modifies de la facon suivante: as follows: 1. To change the number and class of shares that the Corporation is authorized to issue by: (a) Cancelling the authorized and unissued Class A Preference Shares; (b) Cancelling the authorized and unissued Class B Preference Shares; (c) Cancelling the authorized and unissued Class C Preference Shares; (d) Creating an unlimited number of Special Shares without par value; 1A (e) Redesignating, changing and dividing the 10 issued and outstanding Class A Preference Shares into 1,000 Special Shares and 10,000 Common Shares on the basis of 100 Special Shares and 1,000 Common Shares for each issued Class A Preference Share, which Common Shares rank on a parity with the existing unlimited number of Common Shares without par value in the capital of the Corporation; (f) Declaring that the Corporation is authorized to issue an unlimited number of Special Shares without par value and an unlimited number of Common Shares without par value; 2. To delete the rights, privileges, restrictions and conditions attaching to the Class A Preference Shares, the Class B Preference Shares and the Class C Preference Shares as set out in Itema a 4(a), (b), (c), (d), (e), (f), (g), (h), (i), (j), (k), (l), (m) and (n) of the Articles of Amendment of the Corporation and to substitute the following therefor: (a) The holders of the Special Shares shall be entitled to receive and the Corporation shall pay thereon as and when declared by the Board of Directors out of the moneys of the Corporation properly applicable to the payment of dividends, fixed cumulative preferential cash dividends at the rate of 9% per annum of the redemption/retraction amount of the said Special Shares as hereinafter forth, payable on the dates to be fixed from time to time by resolution of the Directors; (b) No dividends shall at any time be declared or paid or set part for the Common Shares unless all dividends up to and including the dividend payable for the last completed quarter, half or full year of the Corporation on the Special Shares then issued and outstanding shall have been declared and paid or provided for at the date of such declaration or payment or setting apart; (c) In the event of the liquidation, dissolution or winding up of the Corporation or other distribution of assets of the Corporation among its shareholders for the purpose of winding up its affairs, the holders of the Special Shares shall be entitled to receive an amount equal to the redemption/ retraction value of the said Special Shares together with all unpaid cumulative dividends (which for such purposes shall be calculated as if such dividends were accruing for the period from the expiration of the last period for which dividends have been paid up to the date of distribution) before any amount shall be paid or any property or assets of the Corporation distributed to the holders of the Common Shares. After payment to the holders of the Special shares of the amounts 1B so payable to them as above provided, they shall not be entitled to share in any further distribution of the property or assets of the Corporation; (d) The Corporation may redeem the whole or any part of the Special Shares outstanding upon payment of the sum of $488.00 for each Special Share to be redeemed together with an amount equal to all unpaid cumulative dividends, whether or not declared, which shall have accrued thereon and which, for such purpose, shall be treated as accruing up to the date of such redemption; in case a part only of the then outstanding Special Shares is at any time to be redeemed, the shares so to be redeemed shall be selected by lot in such manner as the Directors in their discretion shall decide or, if the directors so determine, may be redeemed pro rata, disregarding fractions, and the Directors may make such adjustment as may be necessary to avoid the redemption of fractional parts of shares; not less than 30 days' notice in writing of such redemption shall be given by mailing such notice to the registered holders of the shares to be redeemed to the last known address of each such holder, specifying the date and place or places of redemption; if notice of any such redemption be given by the Corporation in the manner aforesaid and an amount sufficient to redeem the shares be deposited with any trust company or chartered bank in Canada as specified in the notice on or before the date fixed for redemption, dividends on the Special Shares to be redeemed shall cease after the date so fixed for redemption and the holders thereof shall thereafter have no rights against the Corporation in respect thereof except upon the surrender of certificates for such shares, to receive payment therefor out of the moneys so deposited. Upon any such redemption, the Corporation shall adjust the stated capital account maintained for the Special Shares as provided in the Act; (e) The holders of the Special Shares shall be entitled to require the Corporation to redeem at any time or times after the issue thereof all or any of the Special Shares registered in the name of such holder on the books of the Corporation by tendering to the Corporation at its registered office a share certificate or share certificates representing the Special Shares which the registered holder desires to have the Corporation redeem together with a request in writing specifying (1) that the registered holder desires to have the Special Shares represented by such certificate redeemed by the Corporation and (2) the business day (in this paragraph referred to as the "redemption date") on which the holder desires to have the Corporation redeem such Special Shares, which redemption date shall not be less than 30 days after the day on which the request in writing is given to the Corporation. Upon receipt of a share certificate or share certificates representing the Special Shares which the registered holder 2 meetings at which only holders of a specified class of shares are entitled to vote, and are entitled to receive the remaining property of the Corporation upon a dissolution or winding up. 5. The amendment has been duly La modification a ete dument authorized as required by Sections autorisee conformement a 167 and 169(as applicable) of the l'article 167 et, s'il y a lieu, Business Corporations Act. a l'article 169 de la Loi sur les compagnies. 6. The resolution authorizing the Les actionnaires ou les amendment was approved by the administrateurs(le cas echeant) shareholders/directors (as de la compagnie ont approuve la applicable) of the corporation on resolution autorisant la modification. NOVEMBER 7, 1988 - -------------------------------------------------------------------------------- [Day, Month, Year] (jour, mois, annee) These articles are signed Les presents statuts sont signes in duplicate. en double exemplaire. 528650 ONTARIO LIMITED -------------------------------------- (Name of Corporation) (Denomination sociale de la compagnie) By/Par: /s/ [ILLEGIBLE] PRESIDENT ------------------------- EX-3.28 26 y98028exv3w28.txt BYLAWS EXHIBIT 3.28 BY-LAW NO. 1 A A by-law relating generally to the conduct of the business and affairs of 528650 ONTARIO LIMITED (herein called the "Corporation") CONTENTS 1. Interpretation 8. Dividends 2. Directors 9. Financial Year 3. Meetings of Directors 10. Notices 4. Remuneration and Indemnification 11. Execution of Documents 5. Officers 12. Effective Date 6. Meetings of Shareholders 13. Repeal 7. Shares BE IT ENACTED as a by-law of the Corporation as follows: 1. INTERPRETATION 1.01 In this by-law and all other by-laws and resolutions of the Corporation, unless the context otherwise requires: (a) "Act" means the Business Corporations Act, 1982, and includes the Regulations made pursuant thereto; (b) "articles" means the articles of incorporation of the Corporation as amended from time to time; (c) "board" means the board of directors of the Corporation; (d) "by-laws" means all by-laws, including special by-laws, of the Corporation as amended from time to time; (e) "Corporation" means this Corporation; -2- (f) "person" includes an Individual, sole proprietorship, partnership, unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, and a natural person in his capacity as trustee, executor, administrator, or other legal representative; 1.02 In this by-law where the context requires words importing the singular include the plural and vice versa and words importing gender include the masculine, feminine and neuter genders. 1.03 All the words and terms appearing in this by-law shall have the same definitions and application as in the Act. 2. DIRECTORS 2.01 Powers - Subject to any unanimous shareholders' agreement, the business and affairs of the Corporation shall be managed or supervised by a board of directors being composed of: Delete as applicable. A variable board of not fewer than one and not more than five directors. 2.02 Resident Canadians - Except where the Corporation is a non-resident corporation, a majority of the directors shall be resident Canadians but where the Corporation has only one or two directors, one director shall be a resident Canadian. 2.03 Qualifications- Any individual may be a director of the Corporation except: (I) A person who is less than eighteen years of age. (II) A person who is of unsound mind and has been so found by a court; (III) A person who has the status of a bankrupt. -3- 2.04 Election and Term - The election of directors shall take place at the first meeting of shareholders and at each succeeding annual meeting at which an election of directors is required. The directors shall hold office for an expressly stated term which shall expire not later than the close of the third annual meeting of shareholders following the election. A director not elected for an expressly stated term ceases to hold office at the close of the first annual meeting of shareholders following his election. Incumbent directors, if qualified, shall be eligible for re-election. If an election of directors is not held at the proper time the directors shall continue in office until their successors are elected. 2.05 Resignation - A director who is not named in the articles may resign from office upon giving a written resignation to the Corporation and such resignation becomes effective when received by the Corporation or at the time specified in the resignation, whichever is later. A director named in the articles shall not be permitted to resign his office unless at the time the resignation is to become effective a successor is elected or appointed. 2.06 Removal- Subject to clause (f) of section 120 of the Act, the shareholders may, by ordinary resolution at an annual or special meeting remove any director or directors from office before the expiration of his term and may, by a majority of the votes cast at the meeting, elect any person in his place for the remainder of his term. -4- 2.07 Vacation of Office - A director ceases to hold office when he dies, resigns, is removed from office by the shareholders, or ceases to have the necessary qualifications. 2.08 Vacancies - Subject to the exceptions in section 124 of the Act, where a vacancy occurs on the board, a quorum of the directors then in office may appoint a person to fill the vacancy for the remainder of the ter. If there is not a quorum of directors or if there has been a failure to elec the number of directors required by the articles or in the case of a variabl board as required by special resolution, the directors then in office shall forthwith call a special meeting of shareholders to fill the vacancy and, if they fail to call a meeting or if there are no directors then in office, the meeting may be called by any shareholder. 3. MEETINGS OF DIRECTORS 3.01 Place of Meetings - Meetings of the board may be held at the registered office of the Corporation or at any other place within or outside Ontario but, except where the Corporation is a non-resident corporation, or the articles or the by-laws otherwise provide, in any financial year of the Corporation a majority of the meetings of the board shall be held at a place within Canada. 3.02 Meetings by Telephone - Where all the directors present at or participating in the meeting have consented thereto, any director may participate in a meeting of the board by means of conference telephone, -5- electronic or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously and a director participating in such a meeting by such means is deemed for the purposes of the Act and these by-laws to be present at the meeting. If a majority of the directors participating in such a meeting are then in Canada the meeting shall be deemed to have been held in Canada. 3.03 Calling of Meetings - Meetings of the board shall be held from time to time at such place, at such time and on such day as the president or a vice-president who is a director or any two directors may determine, and the secretary shall call meetings when directed or authorized by the president or by a vice-president who is a director or by any two directors. Notice of every meeting so called shall be given to each director not less than 48 hours (excluding any part of a Sunday and of a holiday as defined by the Interpretation Act) before the time when the meeting is to be held, except that no notice of meeting shall be necessary if all the directors are present or if those absent have waived notice of or otherwise signified their consent to the holding of such meeting. A notice of a meeting of directors need not specify the purpose of or the business to be transacted at the meeting except where the Act requires such purpose or business to be specified. 3.04 Regular Meetings- The board may appoint a day or days in any month or months for regular meetings at a place and hour to be named. A copy of any resolution of the board fixing the place and time of regular meetings of the board shall be sent to each director forthwith after being passed, but no other notice shall be required for any such regular meetings. -6- 3.05 First Meeting of New Board - Each newly elected board may without notice hold its first meeting for the purpose of organization and the election and appointment of officers immediately following a meeting of shareholders at which such board is elected, provided that a quorum of directors is present. 3.06 Quorum - Where the Corporation has only one director, that director may constitute a quorum for the transaction of business at any meeting of the board. Where the Corporation has two directors both directors of the Corporation must be present at any meeting of the board to constitute a quorum. Subject to the articles or by-laws of the Corporation a majority of the number of directors or minimum number of directors required by the articles constitutes a quorum at any meeting of directors but in no case shall a quorum be less than two-fifths of the number of directors or less then the minimum number of directors, as the case may be. 3.07 Resident Canadians - Directors shall not transact business at a meeting of the board unless a majority of the directors present are resident Canadians. However, directors may transact business at a meeting of the board where a majority of resident Canadian directors is not present if, (a) a resident Canadian director who is unable to be present approves in writing or by telephone or other communications facilities the business transacted at the meeting, and (b) a majority of resident Canadian directors would have been present had the director been present at the meeting. 3.08 Chairman - The Chairman of any meeting of the board shall be the first mentioned of such of the following officers as have been appointed -7- and who is a director and is present at the meeting: Chairman of the board, President, or A Vice-President who is a director. If no such officer is present, the directors present shall choose one of their number to be chairman. 3.09 Votes to Govern - At all meetings of the board, every question shall be decided by a majority of the votes cast on the question. 3.10 Casting Vote - In the case of an equality of votes on any question at a meeting of the board, the chairman of the meeting shall be entitled to a second or casting vote. 3.11 Disclosure of Interests in Contracts - Every director or officer of the Corporation who is a party to a material contract or proposed material contract with the Corporation, or is a director or officer or has a material interest in any Corporation which is a party to a material contract or proposed material contract with the Corporation shall disclose in writing to the Corporation or request to have entered in the minutes of the meeting of directors the nature and extent of his interest as required by section 132 of the act. 3.12 Resolution in Lieu of Meeting - A resolution in writing, signed by all the directors entitled to vote on that resolution at a meeting of directors or committee of directors, is as valid as if it had been passed at a meeting of directors or committee of directors. A copy of every such resolution shall be kept with the minutes of the proceedings of the directors -8- or committee of directors. 3.13 Delegation - Directors may appoint from their number a managing director who is a resident Canadian or a committee of directors and delegate to such managing director or committee any of the powers of the directors. If the directors appoint a committee of directors, a majority of the members of the committee must be resident Canadians. Unless otherwise determined by the board, each committee shall have the power to fix its quorum at not less than a majority of its members, to elect its chairman and to regulate its procedure. 4. REMUNERATION AND INDEMNIFICATION 4.01 Remuneration - Subject to the articles, the by-laws or any unanimous Shareholders' Agreement, the board may fix the remuneration of the directors. Such remuneration shall be in addition to any salary or professional fees payable to a director who serves the Corporation in any other capacity. In addition, directors shall be paid such sums in respect of their out-of-pocket expenses incurred in attending board, committee or shareholders' meetings or otherwise in respect of the performance by them of their duties as the board may from time to time determine. 4.02 Limitation of Liability - No director or officer shall be liable for the acts, receipts, neglects or defaults of any other director or officer or employee, or for joining in any receipt or other act for conformity or for any loss, damage or expense happening to the Corporation through the -9- insufficiency or deficiency of title to any property acquired for or on behalf of the Corporation, or for the insufficiency or deficiency of any security in or upon which any of the monies of the Corporation shall be invested, or for any loss or damage arising from the bankruptcy, insolvency or tortious acts of any person with whom any of the monies, securities or effects of the Corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his part, or for any other loss, damage or misfortune whatever which shall happen in the execution of the duties of his office or in relation thereto, unless the same are occasioned by his own willful neglect or default; provided that nothing herein shall relieve any director or officer from the duty to act in accordance with the act or from liability for any breach thereof. 4.03 Indemnity of Directors and Officers - Except as provided in section 136 of the Act, every director and officer of the Corporation, every former director or officer of the Corporation or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor, and his heirs and legal representatives shall, from time to time, be indemnified and saved harmless by the Corporation from and against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of such corporation or body corporate if, (a) he acted honestly and in good faith with a view to the best interests of the Corporation; and -10- (b) In the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful. 4.04 Insurance - Subject to the limitations contained in the Act, the Corporation may purchase and maintain such insurance for the benefit of its directors and officers as such, as the board may from time to time determine. 5. OFFICERS 5.01 Election or Appointment - At the first meeting of the board after each election of directors, the board shall elect or appoint a president, and a secretary and if deemed advisable may appoint one or more vice-presidents, a general manager, a treasurer and such other officers as the board may determine including one or more assistants to any of the officers so appointed. None of the said officers, except the president need be a director or shareholder. Any two of the said offices may be held by the same person. If the same person holds the office of secretary and treasurer, he may, but need not, be known as the secretary-treasurer. 5.02 Term, Remuneration and Removal - The terms of employment and remuneration of all officers elected or appointed by the board (including the president) shall be determined from time to time by resolution of the board. The fact that any officer or employee is a director or shareholder of the Corporation shall not disqualify him from receiving such remuneration as may be determined, all officers, in the absence of agreement to the -11- contrary, shall be subject to removal by resolution of the board at any time with or without cause. 5.03 President - The president shall be the chief executive officer of the Corporation. He shall, if present, preside at all meetings of the shareholders and of the directors and shall be charged with the general supervision of the business and affairs of the Corporation except the power to do anything referred to in sub-section 127(3) of the Act. Except when the board has appointed a general manager or managing director, the president shall also have the powers and be charged with the duties of that office except the power to do anything referred to in sub-section 127(3) of the Act. 5.04 Vice-President - The vice-president, or if there are more than one, the vice-presidents in order of seniority (as determined by the board) shall be vested with all the powers and shall perform all the duties of the president in the absence or disability or refusal to act of the president, except that he shall not preside at meetings of the directors or shareholders unless he is qualified to attend meetings of directors or shareholders as the case may be. If a vice-president exercises any such duty or power, the absence or inability of the president shall be presumed with reference thereto. A vice-president shall also perform such duties and exercise such powers as the president may from time to time delegate to him or the board may prescribe. -12- 5.05 General Manager - The general manager, if one is appointed, shall have the general management and direction, subject to the authority of the board and the supervision of the president, of the Corporation's business and affairs and the power to appoint and remove any and all officers employees and agents of the Corporation not elected or appointed directly by the board and to settle the terms of their employment and remuneration but shall not have the power to do any of the things set forth in sub-section 127(3) of the Act. If and so long as the general manager is a director, he may but need not be known as the managing director. 5.06 Secretary - The secretary shall attend all meetings of the directors, shareholders and committees of the board and shall enter or cause to be entered in books kept for that purpose minutes of all proceedings at such meetings; he shall give, or cause to be given, when instructed, notices required to be given to shareholders, directors, auditors and members of committees; he shall be the custodian of the stamp or mechanical device generally used for affixing the corporate seal of the Corporation and of all books, papers, records, documents and other instruments belonging to the Corporation; and he shall perform such other duties as may from time to time be prescribed by the board. 5.07 Treasurer - The treasurer shall keep, or cause to be kept proper accounting records as required by the Act; he shall deposit or cause to be deposited all monies received by the Corporation in the Corporation's bank account; he shall, under the direction of the board, supervise the -13- safekeeping of securities and the disbursement of the funds of the Corporation; he shall render to the board, whenever required, an account of all his transactions as treasurer and of the financial position of the Corporation; and he shall perform such other duties as may from time to time be prescribed by the board. 5.08 Other Officers - The duties of all other officers of the Corporation shall be such as the terms of their engagement call for or the board requires of them. Any of the powers and duties of an officer to whom an assistant has been appointed may be exercised and performed by such assistant, unless the board otherwise directs. 5.09 Variation of Duties - From time to time the board may vary, add to or limit the powers and duties of any officer or officers, but shall not delegate to any officer any of the powers set forth in sub-section 127(3) of the Act. 5.10 Agents and Attorneys - The board shall have power from time to time to appoint agents or attorneys for the Corporation in or out of Ontario with such powers of management or otherwise (including the power to sub-delegate) as may be thought fit. 5.11 Fidelity Bonds - The board may require such officers, employees and agents of the Corporation as it deems advisable to furnish bonds for the faithful performance of their duties, in such form and with such surety as the board may from time to time prescribe. -14- 6. MEETINGS OF SHAREHOLDERS 6.01 Annual Meetings - The directors shall call the first annual meeting of shareholders not later than eighteen months after the Corporation comes into existence and subsequently not later than fifteen months after holding the last preceding annual meeting. The annual meeting of shareholders of the Corporation shall be held at such time and on such day in each year as the board may from time to time determine, for the purpose of receiving the reports and statements required by the Act to be laid before the annual meeting, electing directors, appointing auditors and fixing or authorizing the board to fix their remuneration, and for the transaction of such other business as may properly be brought before the meeting. 6.02 Special Meetings - The board may at any time call a special meeting of shareholders for the transaction of any business which may properly be brought before such meeting of shareholders. All business transacted at an annual meeting of shareholders, except consideration of the financial statements, auditor's report, election of directors and reappointment of the incumbent auditor, is deemed to be special business. 6.03 Place of Meetings - Meetings of shareholders shall be held at the registered office of the Corporation, or at such other place within Ontario as the board from time to time determines. 6.04 Notice of Meetings - Notice of the time and place of each meeting of shareholders shall be sent not less than 10 days and not more -15- than 50 days before the date of the meeting to the auditor of the Corporation to each director, and to each person whose name appears on the records of the Corporation at the close of business on the day next preceding the giving of the notice as a shareholder entitled to vote at the meeting. Notice of a special meeting of shareholders shall state: (a) the nature of the business to be transacted at the meeting in sufficient detail to permit the shareholders to form a reasoned judgment thereon; and (b) the text of any special resolution or by-law to be submitted to the meeting. 6.05 Persons Entitled to be Present - The only persons entitled to attend a meeting of shareholders shall be those entitled to vote thereat, the directors and the auditor of the Corporation and others who although not entitled to vote are entitled or required under any provision of the Act or by-laws of the Corporation to be present at the meeting. Any other persons may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting. 6.06 Quorum - The holders of a majority of the shares entitled to vote at a meeting of shareholders present in person or by proxy constitutes a quorum for the transaction of business at any meeting of shareholders. 6.07 One Shareholder Meeting - If the Corporation has only one shareholder, or only one holder of any class or series of shares, the shareholder present in person or by proxy constitutes a meeting. -16- 6.08 Right to Vote - At any meeting of shareholders, unless the articles otherwise provide, each share of the Corporation entitles the holder thereof to one vote at a meeting of shareholders. 6.09 Joint Shareholders - Where two or more persons hold the same share or shares jointly, any one of such persons present at a meeting of shareholders may in the absence of the others vote the shares but, if two or more of such persons who are present in person or by proxy, vote, they shall vote as one on the shares jointly held by them. 6.10 Proxies - Every shareholder entitled to vote at a meeting of shareholders may by means of a proxy appoint a proxy holder or one or more alternate proxy holders who are not required to be shareholders to attend and act at the meeting in the manner and to the extent authorized by the proxy and with the authority conferred by the proxy. A proxy shall be in writing and executed by the shareholder or by his attorney authorized in writing. Subject to the requirements of the Act the instrument may be in such form as the directors from time to time prescribe or in such other form as the chairman of the meeting may accept as sufficient. It shall be deposited with the Corporation before any vote is taken under its authority, or at such earlier time and in such manner as the board by resolution prescribes. 6.11 Scrutineers - At each meeting of shareholders one or more scrutineers may be appointed by a resolution of the meeting or by the chairman with the consent of the meeting to serve at the meeting. Such -17- scrutineers need not be shareholders of the Corporation. 6.12 Votes to Govern - Unless otherwise required by the Act, or the article or by-laws of the Corporation, all questions proposed for the consideration of the shareholders at a meeting shall be decided by a majority of the votes cast thereon. 6.13 Show of Hands - At all meetings of shareholders every question shall be decided by a show of hands unless a ballot thereon be required by the chairman or be demanded by a shareholder or proxyholder present and entitled to vote. Upon a show of hands every person present and entitled to vote, has one vote regardless of the number of shares he represents. After a show of hands has been taken upon any question, the chairman may require or any shareholder or proxyholder present and entitled to vote may demand a ballot thereon. Whenever a vote by show of hands shall have been taken upon a question, unless a ballot thereon be so required or demanded, a declaration by the chairman that the vote upon the question has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting shall be prima facie evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against the question. The result of the vote so taken and declared shall be the decision of the Corporation on the question. A demand for a ballot may be withdrawn at any time prior to the taking of the ballot. 6.14 Ballots - If a ballot is required by the chairman of the meeting or is demanded and the demand is not withdrawn, a ballot upon the -18- question shall be taken in such manner as the chairman of the meeting directs. 6.15 Adjournment - The chairman of a meeting of shareholders may, with the consent of the meeting and subject to such conditions as the meeting may decide, adjourn the meeting from time to time and from place to place. 7. SHARES 7.01 Allotment - Subject to any Unanimous Shareholders' Agreement, the board may from time to time Issue or grant options to purchase the whole or any part of the authorized and unissued shares of the Corporation at such time and to such persons and for such consideration as the board shall determine, provided that no share shall be issued until it is fully paid as prescribed by the Act. 7.02 Lien for Indebtedness - Subject to the Act, the Corporation has a lien on shares registered in the name of a shareholder or his legal representative for any debt of the shareholder to the Corporation. The Corporation may enforce the lien by: (i) in the case of redeemable shares, redeeming the shares at their redemption price; and (ii) in the case of all other shares by purchasing such shares at their book value for cancellation or for re-sale; and by applying the value of such shares so determined to the debt of the shareholder. In enforcing the lien as aforesaid the Corporation shall not be obliged to redeem or purchase all of the shares of that class but only -19- the shares subject to the lien. In electing to enforce the lien in this manner the Corporation shall not prejudice or surrender any other rights of enforcement of the lien which may in law be available to it or any other remedy available to the Corporation for collection of the debt or any part thereof. 7.03 Share Certificates - Every holder of one or more shares of the Corporation is entitled, at his option, to a share certificate, or to a non-transferable written acknowledgment of his right to obtain a share certificate, stating the number and class or a series of shares held by him as shown on the records of the Corporation. Share certificates and acknowledgments of a shareholder's right to a share certificate shall be in such form as the board shall from time to time approve. The share certificate shall be signed manually by at least one director or officer of the Corporation or by or on behalf of the registrar or transfer agent and any additional signatures required on the share certificate may be printed or otherwise mechanically reproduced thereon. 7.04 Replacement of Share Certificates - The directors may by resolution prescribe, either generally or in a particular case, the conditions upon which a new share certificate may be issued to replace a share certificate which has been defaced, lost, stolen or destroyed. 7.05 Transfer Agent and Registrar - The board may from time to time appoint a registrar to maintain the securities register and a transfer agent to maintain the register of transfers and may also appoint one or -20- more branch registrars to maintain branch security registers and one or more branch transfer agents to maintain branch registers of transfers, but one person may be appointed both registrar and transfer agent. The board may at any time terminate any such appointment. 7.06 Joint Shareholders - If two or more persons are registered as joint holders of any share, the Corporation shall not be bound to issue more than one certificate in respect thereof, and delivery of such certificate to one of such persons shall be sufficient delivery to all of them. Any one of such persons may give effectual receipts for the certificate issued in respect thereof or for any dividends, bonus, return of capital or other money payable or warrant issuable in respect of such share. 8. DIVIDENDS 8.01 Declaration - Subject to the Act and the articles, the board may declare and the Corporation may pay a dividend to the shareholders according to their respective rights in the Corporation. Such a dividend may be paid by issuing fully paid shares of the Corporation or options or rights to acquire fully paid shares of the Corporation or may be paid in money or property. 8.02 Payment - A dividend payable in cash shall be paid by cheque drawn on the Corporation's bankers or one of them to the order of each registered holder of shares of the class in respect of which it has been declared, and mailed by ordinary mail postage prepaid to such registered - 21 - holder at his last address appearing on the records of the Corporation. In the case of joint holders the cheque shall, unless such joint holders otherwise direct, be made payable to the order of all of such joint holders and if more than one address appears on the books of the Corporation in respect of such joint holding the cheque shall be mailed to the first address so appearing. The mailing of such cheque as aforesaid shall satisfy and discharge all liability for the dividend to the extent of the sum represented thereby, unless such cheque be not paid on presentation. 8.03 Non-Receipt of Cheque - In the event of the non-receipt of any cheque for a dividend by the person to whom it is so sent as aforesaid, the Corporation on proof of such non-receipt and upon satisfactory indemnity being given to it shall issue to such person a replacement cheque for a like amount. 8.04 Purchase of Business as of Past Date - Where any business is purchased by the Corporation as from a past date (whether such date be before or after the Incorporation of the Corporation) upon terms that the Corporation shall as from that date take the profits and bear the losses of the business, such profits or losses as the case may be shall, at the discretion of the directors be credited or debited wholly or in part to revenue account, and in that case the amount so credited or debited shall, for the purpose of ascertaining the fund available for dividends, be treated as a profit or loss arising from the business of the Corporation. - 22 - 9. FINANCIAL YEAR 9.01 Financial Year - The financial or fiscal year of the Corporation shall end on the 30th day of April in each year. 10. NOTICES 10.01 Method of Giving Notice - Any notice, communication or other document to be given by the Corporation to a shareholder, director, officer, or auditor of the Corporation under any provision of the Act, the articles or by-laws shall be sufficiently given if delivered personally to the person to whom it is to be given, or if delivered to his recorded address or if mailed to him at his recorded address by prepaid ordinary mail or if sent to him at his recorded address by any means of any prepaid transmitted or recorded communication. A notice so delivered shall be deemed to have been given when it is delivered personally or delivered to the recorded address as aforesaid; a notice so mailed shall be deemed to have been given when deposited in a post office or public letter box and shall be deemed to have been received on the fourth day after so depositing; and a notice so sent by any means of transmitted or recorded communication shall be deemed to have been given when dispatched or delivered to the appropriate communication company or agency or its representative for dispatch. The secretary may change or cause to be changed the recorded address of any shareholder, director, officer or auditor of the Corporation in accordance with any information believed by him to be reliable. The recorded address of a director shall be his latest address as shown in the - 23 - records of the Corporation or in the most recent notice filed under the Corporations information Act, whichever is the more current. 10.02 Computation of Time - In computing the date when notice must be given under any provision of the articles or by-laws requiring a specified number of days notice of any meeting or other event, the date of giving the notice shall, unless otherwise provided, be included. 10.03 Omissions and Errors - The accidental omission to give any notice to any shareholder, director, officer, or auditor, or the non-receipt of any notice by any shareholder, director, officer, or auditor or any error in any notice not affecting the substance thereof shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise founded thereon. 10.04 Notice to Joint Shareholders - All notices with respect to any shares registered in more than one name may if more than one address appears on the records of the Corporation in respect of such Joint holding, be given to such joint shareholders at the first address so appearing, and notice to given shall be sufficient notice to all the holders of such shares. 10.05 Persons Entitled by Death or Operation of law - Every person who by operation of law, by transfer or the death of a shareholder or otherwise becomes entitled to shares, is bound by every notice in respect of such shares which has been duly given to the registered holder of such shares prior to his name and address being entered on the records of the - 24 - Corporation. 10.06 Waiver of Notice - Any shareholder (or his duly appointed proxy) director, officer or auditor may waive any notice required to be given under the articles or by-laws of the Corporation and such waiver, whether given before or after the meeting or other event of which notice is required to be given shall cure any default in the giving of such notice. 10.07 Signatures to Notices - The signatures to any notice to be given by the Corporation may be written, stamped, typewritten or printed or partly written, stamped, typewritten or printed. 11. EXECUTION OF DOCUMENTS 11.01 Signing Officers - Deeds, transfers, assignments, contracts and obligations of the Corporation may be signed by the president or a vice- president or a director together with the secretary or treasurer or an assistant secretary or assistant treasurer or another director. Notwithstanding this, the board may at any time and from time to time direct the manner in which and the person or persons by whom any particular deed, transfer, contract or obligation or any class of deeds, transfers, contracts or obligations may be signed. 11.2 Seal - Any person authorized to sign any document may affix the corporate seal thereto. - 25 - 12. EFFECTIVE DATE 12.01 Effective Date - This by-law comes into force upon confirmation by the shareholders of the Corporation in accordance with the Act. 13. REPEAL 13.01 Repeal - Upon this by-law coming into force, By-laws Number 1 & 2 of the Corporation are repealed provided that such repeal shall not affect the previous operation of such by-law so repealed or affect the validity of any act done or right, privilege, obligation or liability acquired or incurred under the validity of any contract or agreement made pursuant to any such by-law prior to its repeal. ENACTED this 27th day of February 1984. /s/ Ronald Parent /s/ Wendy Parent - -------------------------------- -------------------------------- President - Secretary - Ronald Parent Wendy Parent (Corporate Seal) - 26 - The aforegoing by-law is hereby passed by the Directors of the Corporation pursuant to The Business Corporations Act, 1982, as evidenced by the respective signatures hereto of all the Directors DATED this 27th day of February, 1984. /s/ Ronald Parent ---------------------------- Ronald Parent /s/ Wendy Parent ---------------------------- Wendy Parent The aforegoing by-law is hereby confirmed by the Shareholder of the Corporation pursuant to The Business Corporations Act, 1982, as evidenced by the signature hereto of the sole Shareholder. DATED this 27th day of February, 1984. /s/ Ronald Parent ---------------------------- Ronald Parent -22- BY-LAW NO. 2 A by-law respecting the borrowing of money, the issuing of debt obligations and the securing of liabilities by 528650 ONTARIO LIMITED BE IT ENACTED as a special by-law of 528650 ONTARIO LIMITED (hereinafter referred to as the "Corporation") as follows:- The directors of the Corporation may from time to time: (a) borrow money on the credit of the Corporation; (b) issue, sell or pledge debt obligations of the Corporation; or (c) charge, mortgage, hypothecate or pledge all or any currently owned or subsequently acquired real or personal, movable or immovable property of the Corporation, including book debts, rights, powers, franchises and undertaking, to secure any debt obligations or any money borrowed, or other debt or liability of the Corporation. ENACTED this 24th day of November 1982 /s/ Ronald Parent /s/ Wendy Parent - -------------------------------- -------------------------------- President Secretary Ronald Parent Wendy Parent (Corporate Seal) -23- The aforegoing by-law is hereby passed by the Directors of the Corporation pursuant to The Business Corporations Act, as evidenced by the respective signatures hereto of all the Directors. DATED this 24th day of November, 1982. /s/ Ronald Parent ---------------------------- Ronald Parent /s/ Wendy Parent ---------------------------- Wendy Parent The aforegoing by-law is hereby confirmed by the Shareholder of the Corporation pursuant to The Business Corporations Act, as evidenced by the signature hereto of the sole Shareholder. DATED this 24th day of November, 1982. /s/ Ronald Parent ---------------------------- Ronald Parent -27- BY-LAW NO. 2 A A By-law respecting the borrowing of money and the issuing of securities by: 528650 ONTARIO LIMITED (herein called the "Corporation") BE IT ENACTED as a By-law of the Corporation as follows: 1. Without limiting the borrowing powers of the Corporation as set forth in the Business Corporations Act, 1982 (the "Act") the Directors of the Corporation may, from time to time, without the authorization of the Shareholders: (a) borrow money upon the credit of the Corporation; (b) issue, re-issue, sell or pledge debt obligations of the Corporation, including without limitation, bonds, debentures, notes or other similar obligations of the Corporation whether secured or unsecured; (c) subject to Section 20 of the Act, give a guarantee on behalf of the Corporation to secure performance of any present or future indebtedness, liability or obligation of any person; and (d) charge, mortgage, hypothecate, pledge or otherwise create a security interest in all or any currently owned or subsequently acquired, real or personal, movable or immovable, property of the Corporation, including without limitation, book debts, rights, powers, franchises and undertakings, to secure any present or future Indebtedness, liabilities or other obligations of the Corporation. 2. The Directors may, from time to time, by resolution delegate any or all of the powers referred to in paragraph I of this By-law to a Director, a Committee of Directors or one or more officers of the Corporation. PASSED by the Directors and sealed with the Corporation's seal this 27th day of February, 1984. /s/ Ronald Parent ------------------------------------ President - Ronald Parent /s/ Wendy Parent ------------------------------------ SEAL Secretary - Wendy Parent -28- The aforegoing by-law is hereby passed by the Directors of the Corporation pursuant to The Business Corporations Act, 1982, as evidenced by the respective signatures hereto of all the Directors. DATED this 27th day of February, 1984. /s/ Ronald Parent ---------------------------- Ronald Parent /s/ Wendy Parent ---------------------------- Wendy Parent The aforegoing by-law is hereby confirmed by the Shareholder of the Corporation pursuant to The Business Corporations Act, 1982, as evidenced by the signature hereto of the sole Shareholder. DATED this 27th day of February, 1984. /s/ Ronald Parent ---------------------------- Ronald Parent [ILLEGIBLE] C.A. [ ] ACCOUNT NO. SAV. [ ] 528650 ONTARIO LIMITED [Name of Company] BY-LAW NO. 3 RESPECTING THE BORROWING OF MONEY BY THE COMPANY BE IT ENACTED as a By-law of the Company that:- 1. The Directors may from time to time borrow money from THE BANK OF NOVA SCOTIA (herein called the "Bank") upon the credit of the Company on cheques, promissory notes, bills of exchange or otherwise in such amounts and subject to such terms as may be considered advisable; AND may assign, transfer, convey, hypothecate, mortgage, charge or pledge to or in favour of the Bank any property of the Company, real or personal, moveable or immoveable, present or future, including book debts, unpaid calls, rights, powers, undertaking, franchises and the Company's own debentures, as security for the fulfilment of any liabilities or obligations, present or future, of the Company to the Bank and may empower the Bank or any person or persons to sell by public or private sale, assign, transfer or convey from time to time any such property; AND may sign, make, draw, accept, endorse, execute and deliver on behalf of and in the name of the Company all such cheques, promissory notes, bills of exchange, drafts, acceptances, orders for the payment of money, warehouse receipts, bills of lading, agreements to give security, assignments, transfers, conveyances, hypothecs, mortgages, pledges, securities and other agreements, documents and instruments as may be necessary or useful in connection with the borrowing of money by and other banking business of the Company. 2. The Directors may authorize any one or more directors, officers, employees or agents of the Company to exercise any of the rights, powers and authorities conferred by this By-law upon the Directors. 3. The borrowing of money from the Bank from time to time heretofore under the authority of the Directors of the Company and the giving of security therefor are hereby ratified and confirmed. 4. This By-law shall continue in force as between the Company and the Bank until a By-law repealing this By-law shall have been validly passed and confirmed and a copy thereof, duly certified under the seal of the Company, shall have been delivered to the Bank and receipt thereof acknowledged by the Bank. SIGNED on behalf and by order of the Board by : "RONALD PARENT" AND "WENDY PARENT" - -------------------------------------------------------------------------------- Type here the names of the officers who signed the By-law in the Minute Book of the Company CERTIFICATE [ILLEGIBLE] [hereby certify that the foregoing is a true copy of *(Special) By-Law No. 3 of the Company duly *[ILLEGIBLE] [ILLEGIBLE] **signed by all the Directors of the Company in the manner authorized by law and that the said By-law was duly confirmed and sanctioned by the Shareholders in the manner authorized by law and that the said By-law is now in full force and effect. [ILLEGIBLE] November 24, 1982 DATE_________________________ _________________________ Secretary [ILLEGIBLE] [ILLEGIBLE] { Corporate Seal } - 2 - The aforegoing by-law is hereby passed by the Directors of the Corporation pursuant to The Business Corporations Act, as evidence by the respective signatures hereto of all the Directors. DATED this 24th day of November, 1982. /s/ Ronald Parent ------------------------------ Ronald Parent /s/ Wendy Parent ------------------------------ Wendy Parent The aforegoing by-law is hereby confirmed by the Shareholder of the Corporation pursuant to The Business Corporations Act, as evide by the signature hereto of the sole Shareholder. DATED this 24th day of November, 1982. /s/ Ronald Parent ------------------------------- Ronald Parent EX-3.29 27 y98028exv3w29.txt ARTICLES OF INCORPORATION EXHIBIT 3.29 [LOGO] Consumer and Consommation et Corporate Affairs Affaires commerciales Canada Canada CERTIFICATE OF INCORPORATION CERTIFICAT DE CONSTITUTION CANADA BUSINESS LOI REGISSANT LES SOCIETES CORPORATIONS ACT PAR ACTIONS DE REGIME FEDERAL 2913607 CANADA LIMITED 291360-7 Name of Corporation - Number - Numero Denomination de la societe I hereby certify that the Je certifie par les presentes above-mentioned que la societe mentionnee Corporation, the Articles ci-haut, dont les statuts of Incorporation of which constitutifs sont joints, a are attached, was ete constituee en societe en incorporated under the vertu de la Loi regissant les Canada Business societes par actions de regime Corporations Act. federal. Le directeur /s/ [ILLEGIBLE] ----------------- Director APRIL 19, 1993/LE 19 AVRIL 1993 Date of Incorporation - Date de constitution [CANADA LOGO] [LOGO] Consumer and Consommation FORM 1 FORMULE 1 Corporate Affairs et Corporations ARTICLES OF STATUTS Canada Canada INCORPORATION CONSTITUTIFS (SECTION [ILLEGIBLE]) (ARTICLE Canada Business Loi sur les societes [ILLEGIBLE]) Corporations Act commerciales canadiennes 1 - Name of Corporation Denomination de la societe 2913607 CANADA LIMITED 2 - The place in Canada where the registered Lieu au Canada ou doit office is to be situated etre situe le siege social Richmond Hill, Ontario 3 - The classes and any maximum number of Categorie et tout nombre shares that the corporation is authorized maximal d'actions que la to issue societe est autorisee a emettre An unlimited number of Special Shares; and An unlimited number of Common Shares The annexed Schedule A is incorporated in this form. 4 - Restrictions if any on share transfers Restrictions sur le transfert des actions, s'il y a lieu The annexed Schedule B is incorporated in this form. 5 - Number (or minimum and maximum number) Nombre (ou nombre minimum et of directors maximum) d'administrateurs A minimum of one and a maximum of five 6 - Restrictions if any on business Limites imposees quant aux the corporation may carry on activites commerciales que la societe peut exploiter, s'il y a lieu There are no restrictions on the business that the Corporation may carry on. 7 - Other provisions if any Autres dispositions s'il y a lieu The annexed Schedule C is incorporated in this form. 8 - Incorporators Fondateurs
Address (include postal code) Names - Noms Address (inclure le code postal) Signature - ---------------------------------------------------------------------------- Ronald Parent 5 Reeve Drive, Markham, Ontario /s/ Ronald Parent L3P 6B8 - ---------------------------------------------------------------------------- Wendy Parent 5 Reeve Drive, Markham, Ontario /s/ Wendy Parent L3P 6B8 - ----------------------------------------------------------------------------
FOR DEPARTMENTAL USE ONLY - A L'USAGE DU MINISTERE SEULEMENT Corporation No. - No. de la societe Filed - Deposee Apr. 19 1993 291360-7 SCHEDULE "A" The rights, privileges, restrictions and conditions attaching to the Common Shares shall be as follows: (a) The holders of the Common Shares shall be entitled to one (1) vote per share at all meetings of the Shareholders of the Corporation; (b) Subject to the prior rights of the holders of the Special Shares, the holders of the Common Shares shall be entitled to receive any dividends declared by the Corporation; (c) Subject to the prior rights attaching to the Special Shares, in the event of the liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the holders of the Common Shares shall be entitled to all the remaining assets of the Corporation. The rights, privileges, restrictions and conditions attaching to the Special Shares shall be as follows: (a) Subject to the Act, the holders of the Special Shares shall not as such have any voting rights for the election of Directors or for any other purpose, nor shall they be entitled to attend meetings of Shareholders or to receive notice of meetings of the Shareholders of the Corporation; (b) The holders of the Special Shares shall in each year, in the discretion of the Directors of the Corporation, but always in preference and priority to any payment of dividends on the Common Shares for such year, be entitled, out of any or all profits or surplus available for dividends, to non-cumulative dividends at the rate of 8% per annum. If in any year, after providing for the full dividend on the Special Shares, there shall remain any profits or surplus available for dividends, the whole or any part thereof may, in the discretion of the Directors, be applied to dividends on the Common Shares. The Special Shares shall not be entitled to any dividend other than, or in excess of, the non-cumulative dividends at the rate of 8% per annum hereinbefore provided for; (c) In the event of the liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary, or other distribution of assets of the Corporation among its Shareholders for the purpose of winding up its affairs or upon a reduction of capital, the holders of the Special Shares shall be entitled to receive 100% of the amount paid to the Corporation for such Special Shares, together with an amount equal to all declared and unpaid 2 Schedule A - Page 2 dividends, if any, before any amount shall be paid or any property or assets of the Corporation distributed to the holders of the Common Shares and upon payment of the amount so payable to them, the holders of the Special Shares shall not be entitled to share in any further distribution of the property or assets of the Corporation; (d) Subject to the Act, the Corporation may upon giving notice as hereinafter provided, redeem at any time the whole or any part of the then outstanding Special Shares on payment for each share to be redeemed of $1.00, together with all declared and unpaid dividends. In case a part only of the then outstanding Special Shares are at any time to be redeemed, pursuant to this clause of Schedule A, the shares so to be redeemed shall be redeemed pro rata in proportion to the number of Special Shares held by the holders thereof, provided that the Corporation shall not be required to pay off or redeem any fractions of shares and that the Directors may depart from such pro rata redemption in such manner and to such extent as may seem to them advisable in order to avoid fractions; (e) In any case of redemption of Special Shares, the Corporation shall at least ten days before the date specified for redemption send by prepaid mail addressed to each person, who at the date of mailing is a recorded holder of Special Shares to be redeemed, a notice in writing of the intention of the Corporation to redeem such Special Shares. Such Notice shall set out the redemption price and the date on which redemption is to take place and if part of the Special Shares held by the person to whom it is addressed are to be redeemed, the number thereof so to be redeemed; (f) On or after the date so specified for redemption, the Corporation shall pay, or cause to be paid to or to the order of the recorded holders of the Special Shares to be redeemed, the redemption price on presentation and surrender at the Registered Office of the Corporation or any other place designated in such notice of the certificate for the Special Shares called for redemption. Such Special Shares shall thereupon be and be deemed to be redeemed and shall be restored to the status of authorized but unissued shares. If only part of the shares represented by any certificate be redeemed, a new certificate for the balance shall be issued at the expense of the Corporation; (g) From and after the date specified in any such notice, the Special Shares called for redemption shall cease to be entitled to dividends and the holders shall not be entitled to exercise any of the rights of Shareholders in respect thereof unless payment of the redemption price shall not be made upon presentation of certificates in accordance with the foregoing provisions, in which case the rights of the holders shall remain unaffected; (h) Should the holders of any of the Special Shares so called for redemption fail to present the certificate or certificates representing the Special Shares on the date specified for redemption the 3 Schedule A - Page 3 Corporation shall have the right to deposit the redemption price of such shares to a special account in any Chartered Bank or Trust Company in Canada to be paid without interest to or to the order of the holders of such Special Shares called for redemption upon presentation and surrender to such bank or trust company of the certificates representing the same. Upon such deposit being made, the Special Shares shall be deemed to be redeemed and shall be restored to the status of authorized but unissued shares and the rights of the holders thereof after such deposit shall be limited to receiving without interest their proportionate part of the total redemption price so deposited against presentation and surrender of the certificates held by them. SCHEDULE: "B" No Shares in the capital of the Corporation shall be transferred without either: (a) the sanction of the Director of the Corporation expressed either by a resolution passed by the votes of a majority of the Directors of the Corporation at a meeting of the Board of Directors or by an instrument or instruments in writing signed by all of the Directors; or (b) the express sanction of the holders of more than 50% of the issued and outstanding shares of the Corporation to which is attached the right to vote at all meetings of the Shareholders of the Corporation, expressed by a resolution passed at a meeting of the holders of such shares, or by an instrument or instruments in writing signed by all of the holders of such shares. EX-3.30 28 y98028exv3w30.txt BYLAWS EXHIBIT 3.30 BY-LAW NO. I A by-law relating generally to the conduct of the affairs of 2913607 CANADA LIMITED CONTENTS 1. Interpretation 8. Dividends 2. Directors 9. Fiscal Year 3. Meetings of Directors 10. Notices 4. Remuneration and Protection 11. Execution of Documents 5. Officers 12. Effective Date 6. Meetings of Shareholders 7. Shares BE IT ENACTED as a by-law of 2913607 CANADA LIMITED as follows,- 1. INTERPRETATION 1.01 In this by-law and all other by-laws and resolutions of the Corporation, unless the context otherwise requires: (a) "Act" means the Canada Business Corporations Act as amended from time to time; (b) "articles" means the articles of incorporation of the Corporation as amended from time to time; (c) "board" means the board of directors of the Corporation; (d) "by-laws" means all by-laws, including special by-laws, of the Corporation as amended from time to time; - 2 - (e) "Corporation" means this Corporation; (f) "person" includes a body corporate, corporation, company, partnership, syndicate, trust and any number or aggregate of persons; (g) the singular includes the plural, and the plural includes the singular; (h) the masculine gender includes the feminine and the neuter. 1.02 All terms defined in the Act have the same meanings in the by-laws and resolutions of the Corporation. 2. DIRECTORS 2.01 Powers - Subject to any unanimous shareholder agreement, the business and affairs of the Corporation shall be managed by a board of 2 directors who may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation and are not by the by-laws or by statute expressly directed or required to be done by the Corporation at meetings of the shareholders. 2.02 Resident Canadians - A majority of the directors and of any committee of the directors shall be resident Canadians as defined in the Act. 2.03 Qualifications - Any person may be a director of the Corporation who is not disqualified by the Act. 2.04 Election and Term - The election of directors shall take place at each annual meeting of shareholders and all the directors then in office shall retire at the close of the - 3 - meeting but, if qualified, shall be eligible for re-election. If an election of directors is not held at the proper time, the directors shall continue in office until their successors are elected. 2.05 Resignation - A director may resign from office upon giving notice thereof in writing to the Corporation and the resignation becomes effective at the time specified in the resignation or upon receipt by the Corporation, whichever is the later. 2.06 Removal - Subject to section 104 of the Act, the shareholders may, by resolution passed by a majority of the votes cast at a special meeting of shareholders duly called for that purpose, remove any director before the expiration of his term of office and may, by a majority of votes cast at the meeting, elect any person in his stead for the remainder of his term. 2.07 Vacation of Office - The office of a director is vacated if he dies or resigns his office, if he is removed from office by the shareholders, or if he ceases to have the necessary qualifications. 2.08 Filling Vacancies - Where a vacancy occurs in the board, except a vacancy resulting from an increase in the number or minimum number of directors or from failure to elect the number or minimum number of directors required by the articles and a quorum of directors remains in office, the - 4 - directors then in office (even though a majority of such directors are not resident Canadians) may appoint a person to fill the vacancy for the remainder of the term. If there is not then a quorum of directors, or if there has been a failure to elect the number or minimum number of directors required by the articles, the directors then in office shall forthwith call a special meeting of shareholders to fill the vacancy, and, if they fail to do so or if there are no directors then in office, the meeting may be called by any shareholder. 3. MEETINGS OF DIRECTORS 3.01 Place of Meetings - Meetings of the board of directors may be held at the head office of the Corporation or at any other place in or outside Canada. 3.02 Quorum - A majority of the number of directors required by the articles constitutes a quorum at any meeting of directors, and, notwithstanding any vacancy among the directors, a quorum of directors may exercise all the powers of the directors. 3.03 Resident Canadians - Directors shall not transact business at a meeting of directors unless a majority of the directors present are resident Canadians. 3.04 Notwithstanding Section 3.03, directors may transact business at a meeting of directors where a majority of resident Canadian directors is not present if, - 5 - (a) A resident Canadian director who is unable to be present approves in writing or by telephone or other communications facilities the business transacted at the meeting; and (b) A majority of resident Canadian directors would have been present had the director been present at the meeting. 3.05 Calling of Meetings - Meetings of the board shall be held from time to time at such place, at such time and on such day as the president or a vice-president who is a director or any two directors may determine, and the secretary shall call meetings when directed or authorized by the president or by a vice-president who is a director or by any two directors. Notice of every meeting so called shall be given to each director not less than 48 hours (excluding any part of a Sunday and of a holiday as defined by the Interpretation Act) before the time when the meeting is to be held, except that no notice of a meeting shall be necessary if all the directors are present or if those absent have waived notice of or otherwise signified their consent to the holding of such meeting. A notice of a meeting of directors shall specify any matter referred to in subsection 110(3) of the Act that is to be dealt with at the meeting but need not otherwise specify the purpose of the business to be transacted at the meeting. 3.06 Regular Meetings - The board may appoint a day or days in any month or months for regular meetings at a place and hour to be named. A copy of any resolution of the board fixing the place and time of regular meetings of the board shall be sent to each director forthwith after being passed, but no other notice shall be required for any such regular meetings. - 6 - 3.07 First Meeting of New Board - Each newly elected board may without notice hold its first meeting for the purpose of organization and the election and appointment of officers immediately following a meeting of shareholders at which such board is elected, provided that a quorum of directors is present. 3.08 Votes to Govern - At all meetings of the board, every question shall be decided by a majority of the votes cast on the question. 3.09 Disclosure of Interests in Contracts - Every director or officer of the Corporation who is a party to a material contract or proposed material contract with the Corporation, or is a director or officer or has a material interest in any Corporation which is a party to a material contract or proposed material contract with the Corporation shall disclose in writing to the Corporation or request to have entered in the minutes of a meeting of directors the nature and extent of his interest as required by section 115 of the Act. 3.10 Waiver of Notice - A director may in any manner waive a notice of a meeting of directors; and attendance of a director at a meeting of directors is a waiver of notice of the meeting, except where a director attends a meeting for the express purpose of objecting to the transactions of any business on the grounds that the meeting is not lawfully called. - 7 - 3.11 Participation by Telephone - A director may, if all the directors of the Corporation consent, participate in a meeting of directors or of a committee of directors by means of such telephone or other communications facilities as permits all persons participating at the meeting to hear each other, and a director participating in such a meeting is deemed to be present at the meeting. 3.12 Adjournment - Notice of an adjourned meeting of directors is not required to be given if the time and place of the adjourned meeting is announced at the original meeting. 3.13 Delegation - Directors may appoint from their number a managing director who is a resident Canadian or a committee of directors and delegate to such managing director or committee any of the powers of the directors. If the directors appoint a committee of directors, a majority of the members of the committee must be resident Canadians. 3.14 Resolution in Lieu of Meeting - A resolution in writing, signed by all the directors entitled to vote on that resolution at a meeting of directors or committee of directors, is as valid as if it had been passed at a meeting of directors or committee of directors. A copy of every such resolution shall be kept with the minutes of the proceedings of the directors or committee of directors. 3.15 One Director Meeting - If the Corporation has only one director, that director may constitute a meeting. - 8 - 4. REMUNERATION AND PROTECTION 4.01 Remuneration - The directors shall be paid such remuneration as may from time to time be determined by the board. Such remuneration shall be in addition to any salary or professional fees payable to a director who serves the Corporation in any other capacity. In addition, directors shall be paid such sums in respect of their out-of-pocket expenses incurred in attending board, committee or shareholders meetings or otherwise in respect of the performance by them of their duties as the board may from time to time determine. 4.02 Indemnity of Directors and Officers - Except as provided in Section 119 of the Act, every director and officer of the Corporation, every former director or officer of the Corporation or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor, and his heirs and legal representatives shall, from time to time, be indemnified and saved harmless by the Corporation from and against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of such corporation or body corporate if, (a) he acted honestly and in good faith with a view to the best interests of the Corporation; and - 9 - (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful. 5. OFFICERS 5.01 Election or Appointment - At the first meeting of the board after each election of directors, the board shall elect or appoint a president, and a secretary and if deemed advisable may appoint one or more vice-presidents, a general manager, a treasurer and such other officers as the board may determine including one or more assistants to any of the officers so appointed. None of the said officers, except the president need be a director or shareholder. Any two of the said offices may be held by the same person. If the same person holds the office of secretary and treasurer, he may, but need not, be known as the secretary-treasurer. 5.02 Term, Remuneration and Removal - The terms of employment and remuneration of all officers elected or appointed by the board (including the president) shall be determined from time to time by resolution of the board. The fact that any office or employee is a director or shareholder of the Corporation shall not disqualify him from receiving such remuneration as may be determined. All officers, in the absence of agreement to the contrary, shall be subject to removal by resolution of the board at any time with or without cause. 5.03 President - The President shall be the chief executive officer of the Corporation. He shall, if present, presi at all meetings of the shareholders and of the directors and shall - 10 - be charged with the general supervision of the business and affairs of the Corporation except the power to do anything referred to in subsection 110(3) of the Act. Except when the board has appointed a general manager or managing director, the President shall also have the powers and be charged with the duties of that office except the power to do anything referred to in subsection 110(3) of the Act. 5.04 Vice-president - The vice-president, or if there are more than one, the vice-presidents in order of seniority (as determined by the board) shall be vested with all the powers and shall perform all the duties of the president in the absence or disability or refusal to act of the president, except that he shall not preside at meetings of the directors or shareholders unless he is qualified to attend meetings of directors or shareholders as the case may be. If a vice-president exercises any such duty or power, the absence or inability of the president shall be presumed with reference thereto. A vice-president shall also perform such duties and exercise such powers as the president may from time to time delegate to him or the board may prescribe. 5.05 General Manager - The general manager, if one is appointed, shall have the general management and direction subject to the authority of the board and the supervision of the president, of the Corporation's business and affairs and the power to appoint and remove any and all officers, employees and agents of the Corporation not elected or appointed directly by - 11 - the board and to settle the terms of their employment and remuneration but shall not have the power to do any of the things set forth in section 110 (3) of the Act. If and so long as the general manager is a director, he may but need not be known as the managing director. 5.06 Secretary - The secretary shall attend all meetings of the directors, shareholders and committees of the board and shall enter or cause to be entered in books kept for that purpose minutes of all proceedings at such meetings; he shall give, or cause to be given, when instructed, notices required to be given to shareholders, directors, auditors and members of committees; he shall be the custodian of the stamp or mechanical device generally used for affixing the corporate seal of the Corporation and of all books, papers, records, documents and other instruments belonging to the Corporation; and he shall perform such other duties as may from time to time be prescribed by the board. 5.07 Treasurer - The Treasurer shall keep, or cause to be kept proper accounting records as required by the Act; he shall deposit or cause to be deposited all monies received by the Corporation in the Corporation's bank account; he shall, under the direction of the board, supervise the safekeeping of securities and the disbursement of the funds of the Corporation; he shall render to the board, whenever required, an account of all his transactions as treasurer and of the financial position of the Corporation; and he shall perform such other duties as may from time to time be prescribed by the board. - 12 - 5.08 Other Officers - The duties of all other officers of the Corporation shall be such as the terms of their engagement call for or the board requires of them. Any of the powers and duties of an officer to whom an assistant has been appointed may be exercised and performed by such assistant, unless the board otherwise directs. 5.09 Variation of Duties - From time to time the board may vary, add to or limit the powers and duties of any officer or officers, but shall not delegate to any officer any of the powers set forth in subsection 110 (3) of the Act. 5.10 Agents and Attorneys - The board shall have power from time to time to appoint agents or attorneys for the Corporation in or out of Ontario with such powers of management or otherwise (including the power to sub-delegate) as may be thought fit. 5.11 Fidelity Bonds - The board may require such officers, employees and agents of the Corporation as it deems advisable to furnish bonds for the faithful performance of their duties, in such form and with such surety as the board may from time to time prescribe. 6. MEETINGS OF SHAREHOLDERS 6.01 Annual Meetings - The annual meeting of shareholders of the Corporation shall be held at such time and on such day in each year as the board may from time to time determine, for the purpose of receiving the reports and statements - 13 - required by the Act to be laid before the annual meeting, electing directors, appointing auditors and fixing their remuneration, and for the transaction of such other business as may properly be brought before the meeting. 6.02 Special Meetings - The directors may at any time call a special meeting of shareholders, for the transaction of any business which may properly be brought before such a meeting of shareholders. All business transacted at an annual meeting of shareholders, except consideration of the financial statements, auditors report, election of directors and re-appointment of the incumbent auditor, is deemed to be special business. 6.03 Place of Meetings - Meetings of shareholders shall be held at the head office of the Corporation, or at such other place within Canada as the directors from time to time determine. 6.04 Notice of Meetings - Notice of the time and place of each meeting of shareholders shall be sent not less than 21 days and not more than 50 days before the date of the meeting to the auditor of the Corporation, to each director, and to each person whose name appears on the records of the Corporation at the close of business on the day next preceding the giving of the notice as a shareholder entitled to vote at the meeting. Notice of a special meeting of shareholders shall state, - 14 - (a) the nature of the business to be transacted at the meeting in sufficient detail to permit the shareholders to form a reasoned judgment thereon; and (b) the text of any special resolution to be submitted to the meeting. 6.05 Persons Entitled to be Present - The only persons entitled to attend a meeting of shareholders shall be those entitled to vote thereat, the directors and the auditor of the Corporation and others who although not entitled to vote are entitled or required under any provision of the Act or by-laws of the Corporation to be present at the meeting. Any other person may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting. 6.06 Quorum - The holders of a majority of the shares entitled to vote at a meeting of shareholders present in person or by proxy constitutes a quorum for the transaction of business at any meeting of shareholders. 6.07 One Shareholder Meeting - If the Corporation has only one shareholder, or only one holder of any class or series of shares, the shareholder present in person or by proxy constitutes a meeting. 6.08 Right to Vote - At any meeting of shareholders, unless the articles otherwise provide, each share of the Corporation entitles the holder thereof to one vote at a meeting of shareholders. - 15 - 6.09 Joint Shareholders - Where two or more persons hold the same share or shares jointly, any one of such persons present at a meeting of shareholders may in the absence of the others vote the shares but, if two or more of such persons who are present in person or by proxy, vote, they shall vote as one on the shares jointly held by them. 6.10 Proxies - Every shareholder entitled to vote at a meeting of shareholders may by means of a proxy appoint a proxyholder or one or more alternate proxyholders who are not required to be shareholders to attend and act at the meeting in the manner and to the extent authorized by the proxy and with the authority conferred by the proxy. A proxy shall be in writing and executed by the shareholder or by his attorney authorized in writing. Subject to the requirements of the Act, the instrument may be in such form as the directors from time to time prescribe or in such other form as the chairman of the meeting may accept as sufficient. It shall be deposited with the secretary of the meeting before any vote is taken under its authority, or at such earlier time and in such manner as the board may prescribe. 6.11 Scrutineers - At each meeting of shareholders one or more scrutineers may be appointed by a resolution of the meeting or by the chairman with the consent of the meeting to serve at the meeting. Such scrutineers need not be shareholders of the Corporation. - 16 - 6.12 Votes to Govern - Unless otherwise required by the Act, or the articles or by-laws of the Corporation, all questions proposed for the consideration of the shareholders at a meeting shall be decided by a majority of the votes cast thereon. 6.13 Show of Hands - At all meetings of shareholders every question shall be decided by a show of hands unless a ballot thereon be required by the chairman or be demanded by a shareholder or proxyholder present and entitled to vote. Upon a show of hands every person present and entitled to vote, has one vote regardless of the number of shares he represents. After a show of hands has been taken upon any question, the chairman may require or any shareholder or proxyholder present and entitled to vote may demand a ballot thereon. Whenever a vote by show of hands shall have been taken upon a question unless a ballot thereon be so required or demanded a declaration by the chairman that the vote upon the question has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting shall be prima facie evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against the question. The result of the vote so taken and declared shall be the decision of the Corporation on the question. A demand for a ballot may be withdrawn at any time prior to the taking of the ballot. 6.14 Ballots - If a ballot is required by the chairman of the meeting or is demanded and the demand is not withdrawn, a ballot upon the question shall be taken in such manner as the chairman of the meeting directs. - 17 - 6.15 Adjournment - The chairman of a meeting of shareholders may, with the consent of the meeting and subject to such conditions as the meeting may decide, adjourn the meeting from time to time and from place to place. 7. SHARES 7.01 issue - Shares in the Corporation may be issued at such times, to such person or persons or class of persons as the directors may determine. 7.02 Share Certificates - Every holder of one or more shares of the Corporation is entitled, without payment, to a share certificate showing the number and class of shares held by him as shown on the records of the Corporation. Share certificates shall be in such form or forms as the board from time to time approves. unless otherwise ordered by the directors, they shall be signed by the president or a vice-president and by the secretary or an assistant secretary and need not be under the corporate seal; provided that certificates representing shares in respect of which a transfer agent or registrar has been appointed shall not be valid unless countersigned by or on behalf of such transfer agent or registrar. If authorized by resolution of the directors, the corporate seal of the Corporation and the signature of one of the signing officers, or in the case of share certificates representing shares in respect of which a transfer agent or registrar has been appointed, the signatures of both signing officers may be printed or otherwise mechanically reproduced upon share certificates. - 18 - 7.03 Replacement of Share Certificates - The directors may by resolution prescribe, either generally or in a particular case, the conditions upon which a new share certificate may be issued to replace a share certificate which has been defaced, lost, stolen or destroyed. 7.04 Securities Records - The directors may from time to time appoint an agent to maintain the central securities register for the shares of the Corporation and if deemed advisable one or more branch securities registers. 8. DIVIDENDS 8.01 Declaration - Subject to the Act and articles, the directors may from time to time declare dividends payable to the shareholders according to their respective rights in the Corporation. Such a dividend may be paid in money or property or by issuing fully paid shares of the Corporation. 8.02 Payment - A dividend payable in cash shall be paid by cheque drawn on the Corporation's bankers or one of them to the order of each registered holder of shares of the class in respect of which it has been declared, and mailed by ordinary mail postage prepaid to such registered holder at his last address appearing on the records of the Corporation. In the case of joint holders the cheque shall, unless such Joint holders otherwise direct, be made payable to the order of all of such joint holders and if more than one address appears on the books of the Corporation in respect of such joint holding - 19 - the cheque shall be mailed to the first address so appearing. The mailing of such cheque as aforesaid shall satisfy and discharge all liability for the dividend to the extent of the sum represented thereby, unless such cheque be not paid on presentation. 8.03 Non-Receipt of Cheque - In the event of the non-receipt of any cheque for a dividend by the person to whom it is so sent as aforesaid, the Corporation on proof of such non-receipt and upon satisfactory indemnity being given to it shall issue to such person a replacement cheque for a like amount. 8.04 Purchase of Business as of Past Date - Where any business is purchased by the Corporation as from a past date (whether such date be before or after the incorporation of the Corporation) upon terms that the Corporation shall as from that date take the profits and bear the losses of the business, such profits or losses as the case may be shall, at the discretion of the directors be credited or debited wholly or in part to revenue account, and in that case the amount so credited or debited shall, for the purpose of ascertaining the fund available for dividends, be treated as a profit or loss arising from the business of the Corporation. 9. FISCAL YEAR 9.01 Fiscal Year - The financial or fiscal year of the Corporation shall end on the 30th day of April in each year. - 20 - 10. NOTICES 10.01 Method of Giving - Any notice, communication or other document to be given by the Corporation to a shareholder, director, officer, or auditor of the Corporation under any provision of the articles or by-laws shall be sufficiently given if delivered personally to the person to whom it is to be given, or if delivered to his last address as shown on the records of the Corporation, or if mailed by prepaid post in a sealed envelope addressed to him at his last address shown on the records of the Corporation or if telegraphed. The secretary may change the address on the records of the Corporation of any shareholder in accordance with any information believed by him to be reliable. A notice, communication or document so delivered shall be deemed to have been given when it is delivered personally or at the address aforesaid; a notice, communication or document so mailed shall be deemed to have been given when it is deposited in a post office or public letter box; and a telegraphed notice shall be deemed to have been given when it is delivered to the appropriate communication company or agency or its representative for dispatch. 10.02 Computation of Time - In computing the date when notice must be given under any provision of the articles or by-laws requiring a specified number of days' notice of any meeting or other event, the date of giving the notice shall, unless otherwise provided, be included. - 21 - 10.03 Omissions and Errors - The accidental omission to give any notice to any shareholder, director, officer or auditor or the non-receipt of any notice by any shareholder, director, officer or auditor or any error in any notice not affecting the substance thereof shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise founded thereon. 10.04 Notice to Joint Shareholders - All notices with respect to any shares registered in more than one name may if more than one address appears on the records of the Corporation in respect of such joint holding, be given to such joint shareholders at the first address so appearing, and notice so given shall be sufficient notice to all the holders of such shares. 10.05 Persons Entitled By Death or Operation of Law - Every person who by operation of law, by transfer or the death of a shareholder or otherwise becomes entitled to shares, is bound by every notice in respect of such shares which has been duly given to the registered holder of such shares prior to his name and address being entered on the records of the Corporation. 10.06 Waiver of Notice - Any shareholder (or his duly appointed proxy) director, officer or auditor may waive any notice required to be given under the articles or - 22 - by-laws of the Corporation and such waiver, whether given before or after the meeting or other event of which notice is required to be given shall cure any default in the giving of such notice. 10.07 Signatures to Notices - The signatures to any notice to be given by the Corporation may be written, stamped, typewritten or printed or partly written, stamped, typewritten or printed. 11. EXECUTION OF DOCUMENTS 11.01 Signing Officers - Deeds, transfers, assignments, contracts and obligations of the Corporation may be signed by the president or a vice-president or a director together with the secretary or treasurer or an assistant secretary or assistant treasurer or another director. Notwithstanding this, the board may at any time and from time to time direct the manner in which and the person or persons by whom any particular deed, transfer, contract or obligation or any class of deeds, transfers, contracts or obligations may be signed. 11.02 Seal - Any person authorized to sign any document may affix the corporate seal thereto. - 23 - 12. EFFECTIVE DATE 12.01 This by-law comes into force upon confirmation by the Shareholders of the Corporation in accordance with the Act. ENACTED this 19th day of April, 1993. /s/ Ronald Parent /s/ Wendy Parent - -------------------------------- ---------------------------------------- President - Ronald Parent Secretary-Treasurer - Wendy Parent - 24 - The foregoing by-law is hereby passed by the Directors of the Corporation pursuant to the Canada Business Corporations Act, as evidenced by the respective signatures hereto of all the Directors. DATED this 19th day of April, 1993. /s/ Ronald Parent ---------------------------------------- Ronald Parent /s/ Wendy Parent ---------------------------------------- Wendy Parent The foregoing by-law is hereby confirmed by the Shareholders of the Corporation pursuant to the Canada Business Corporations Act, as evidenced by the respective signatures hereto of all the Shareholders. DATED this 19th day of April, 1993. 528650 ONTARIO LIMITED Per: /s/ Ronald Parent/Wendy Parent ----------------------------------- /s/ Ronald Parent ---------------------------------------- Ronald Parent /s/ Wendy Parent ---------------------------------------- Wendy Parent BY-LAW NO. 2 Being a by-law respecting the borrowing of money, the issuing of securities and the securing of liabilities by 2913607 CANADA LIMITED BE IT ENACTED as a by-law of 2913607 CANADA LIMITED (hereinafter referred to as the "Corporation") as follows: 1. Without limiting the borrowing powers of the Corporation as set forth in the Act, but subject to the Articles and any unanimous shareholders agreement, the Board may from time to time on behalf of the Corporation, without authorization of the Shareholders: (a) borrow money upon the credit of the Corporation; (b) issue, reissue, sell or pledge bonds, debentures, notes or other evidences of indebtedness or guarantee of the Corporation, whether secured or unsecured; (c) to the extent permitted by the Act, give a guarantee on behalf of the Corporation to secure performance of any present or future indebtedness, liability or obligation of any person; and (d) mortgage, hypothecate, pledge or otherwise create a security interest in all or any currently owned or subsequently acquired real or personal, movable or immovable, property of the Corporation including book debts, rights, powers, franchisee and undertakings, to secure any such bonds, debentures, notes or other evidences of indebtedness or guarantee or any other present or future Indebtedness, liability or obligation of the Corporation. Nothing in this section limits or restricts the borrowing of money by the Corporation on bills of exchange or promissory notes made, drawn, accepted or endorsed by or on behalf of the Corporation. 2. The Board may from time to time delegate to a committee of the Board, a Director or an Officer of the Corporation or any other person as may be designated by the Board all or any of the powers conferred on the Board by Section 1 above or by the Act to such extent and in such manner as the Board may determine at the time of such delegation. ENACTED by the Board this 19th day of April, 1993. /s/ Ronald Parent /s/ Wendy Parent - -------------------------------- ---------------------------------------- President - Ronald Parent Secretary-Treasurer - Wendy Parent - 2 - The foregoing by-law is hereby passed by the Directors of the Corporation pursuant to the Canada Business Corporations Act, as evidenced by the respective signatures hereto of all the Directors. DATED this 19th day of April, 1993. /s/ Ronald Parent ---------------------------------------- Ronald Parent /s/ Wendy Parent ---------------------------------------- Wendy Parent The foregoing by-law is hereby confirmed by the Shareholders of the Corporation pursuant to the Canada Business Corporations Act, as evidenced by the respective signatures hereto of all the Shareholders. DATED this 19th day of April, 1993. 528650 ONTARIO LIMITED Per: /s/ Ronald Parent/Wendy Parent ----------------------------------- /s/ Ronald Parent ---------------------------------------- Ronald Parent /s/ Wendy Parent ---------------------------------------- Wendy Parent BY-LAW NO. 3 being a by-law to amend By-law No. 1 of 2913607 CANADA LIMITED BE IT ENACTED as a by-law of 2913607 CANADA LIMITED (hereinafter referred to as the "Corporation") as follows; 1. By-law No. 1 of the Corporation is hereby amended as follows: (a) by deleting the provision in Section 2.01 and substituting therefor the following: "2.01 Powers - Subject to any unanimous shareholder agreement, the board shall manage the business and affairs of the Corporation. Until changed in accordance with the Act, the board shall consist of such number of directors not greater than 5 nor less than 1 as the board may from time to time determine." (b) by deleting the following sentence from Section 5.01: "None of the said officers, except the president need be a director or shareholder." The foregoing By-law No. 3 is passed as evidenced by the signatures of all the directors of the Corporation pursuant to the provisions of the Canada Business Corporations Act. DATED as of the 5th day of October, 2000. /s/ Edward J. Kowal ---------------------------------------- Edward J. Kowal /s/ Jerry Lirette /s/ Cyril McGrath - --------------------------------- ---------------------------------------- Jerry Lirette Cyril McGrath The foregoing By-law No. 3 is hereby confirmed as evidenced by the signatures of all the shareholders of the Corporation entitled to vote pursuant to the provisions of the Canada Business o Corporations Act. DATED December 10, 2001. 528650 ONTARIO LIMITED D-M-E OF CANADA LIMITED By: /s/ Jerry R. Lirette By: /s/ Jerry R. Lirette ----------------------------- ------------------------------------ Name: Jerry R. Lirette Name: Jerry R. Lirette Title: President Title: President By: /s/ Andrew J. Murany By: /s/ Andrew J. Murany ----------------------------- ------------------------------------ Name: Andrew J. Murany Name: Andrew J. Murany Title: Treasurer Title: Vice President and Treasurer EX-3.31 29 y98028exv3w31.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.31 STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 10:00 AM 09/16/1999 991387130 - 3097545 CERTIFICATE OF INCORPORATION OF D-M-E MANUFACTURING INC. I, the undersigned, for the purposes of incorporating and organizing a corporation under the General Corporation Law of the State of Delaware, do execute this Certificate of Incorporation and do hereby certify as follows: FIRST. The name of the corporation is D-M-E Manufacturing Inc. SECOND. The address of the corporation's registered office in the State of Delaware is One Rodney Square, 10th Floor, Tenth and King Streets, in the City of Wilmington, County of New Castle, 19801. The name of its registered agent at such address is RL&F Service Corp. THIRD. The purpose of the corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware. FOURTH. The total number of shares of stock which the corporation shall have authority to issue is 3,000. All such shares are to be Common Stock, par value of $.01 per share, and are to be of one class. FIFTH. The incorporator of the corporation is John S. Mills, whose mailing address is P.O. Box 551, Wilmington, DE 19899. SIXTH. Unless and except to the extent that the by-laws of the corporation shall so require, the election of directors of the corporation need not be by written ballot. SEVENTH. In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors of the corporation is expressly authorized to make, alter and repeal the by-laws of the corporation, subject to the power of the stockholders of the corporation to alter or repeal any by-law whether adopted by them or otherwise. EIGHTH. A director of the corporation shall not be liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the General Corporation Law of the State of Delaware as the same exists or may hereafter be amended. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of the corporation -1- hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal. NINTH. The corporation reserves the right at any time, and from time to time, to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, and other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted, on the manner now or hereafter prescribed by law; and all rights, preferences and privileges of whatsoever nature conferred upon stockholders, directors or any other persons whomsoever by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended are granted subject to the rights reserved in this article. TENTH. The powers of the incorporator are to terminate upon the filing of this Certificate of Incorporation with the Secretary of State of the State of Delaware. The name and mailing addresses of the persons who are to serve as the initial directors of the corporation until the first annual meeting of stockholders of the corporation, or until his successors are duly elected and qualified, are: H.J. Faig 4701 Marburg Avenue Cincinnati, OH 45209 J.R. Lirette 4701 Marburg Avenue Cincinnati, OH 45209 D.J. Meyer 4701 Marburg Avenue Cincinnati, OH 45209 R.D. Brown 4701 Marburg Avenue Cincinnati, OH 45209 The undersigned incorporator hereby acknowledges that the foregoing certificate of incorporation is his act and deed on this 16th day of September, 1999. /s/ John S. Mills ------------------------ John S. Mills Incorporator -2- STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 11:00 AM 05/12/2000 001243459 - 3097545 CERTIFICATE OF CHANGE OF REGISTERED AGENT AND REGISTERED OFFICE * * * * * D-M-E MANUFACTURING INC., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: The present registered agent of the corporation is RL & F Service Corp. and the present registered office of the corporation is in the country of New Castle. The Board of Directors of D-M-E MANUFACTURING INC. adopted the following resolution on the 10th day of May, 2000. Resolved, that the registered office of D-M-E MANUFACTURING INC. in the state of Delaware be and it hereby is changed to Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle, and the authorization of the present registered agent of this corporation be and the same is hereby withdrawn, and THE CORPORATION TRUST COMPANY, shall be and is hereby constituted and appointed the registered agent of this corporation at the address of its registered office. IN WITNESS WHEREOF, D-M-E MANUFACTURING INC. has caused this statement to be signed by Hugh C. O'Donnell, its Secretary, this 10th day of MAY 2000. /s/ HUGH C. O'DONNELL ---------------------------- Signature/Title HUGH C. O'DONNELL, SECRETARY EX-3.32 30 y98028exv3w32.txt BYLAWS EXHIBIT 3.32 BY-LAWS OF D-M-E MANUFACTURING INC. ---------------------------- ARTICLE I Meeting of Stockholders Section 1.1. Annual Meetings. An annual meeting of stockholders shall be held for the election of directors at such date, time and place, either within or without the State of Delaware, as may be designated by resolution of the Board of Directors from time to time. Any other proper business may be transacted at the annual meeting. Section 1.2. Special Meetings. Special meetings of stockholders for any purpose or purposes may be called at any time by the Board of Directors, but such special meetings may not be called by any other person or persons. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice. Section 1.3. Notice of Meetings. Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given that shall state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise provided by law, the certificate of incorporation, or these by-laws, the written notice of any meeting shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Section 1.4. Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. Section 1.5 Quorum. Except as otherwise provided by law, the certificate of incorporation or these by-laws, at each meeting of stockholders the presence in person or by proxy of the holders of a majority in voting power of the outstanding shares of stock entitled to vote at the meeting shall be necessary and sufficient to constitute a quorum. In the absence of a quorum, the stockholders so present may, by a majority in voting power thereof, adjourn the meeting from time to time in the manner provided in Section 1.4 of these by-laws until a quorum shall attend. Shares of its own stock belonging to the corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the corporation, shall neither be entitled to vote nor be counted for quorum purposes; provided, however, that the foregoing shall not limit the right of the corporation or any subsidiary of the corporation to vote stock, including but not limited to its own stock, held by it in a fiduciary capacity. Section 1.6. Organization. Meetings of stockholders shall be presided over by the Chairman of the Board, if any, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in his absence by a Vice President, or in the absence of the foregoing persons by a chairman designated by the Board of Directors, or in the absence of such designation by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting. Section 1.7. Voting. Proxies. Except as otherwise provided by or pursuant to the provisions of the certificate of incorporation, each stockholder entitled to vote at any meeting of stockholders shall be entitled to one vote for each share of stock held by such stockholder which has voting power upon the matter in question. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or by delivering a proxy in accordance with applicable law bearing a later date to the Secretary of the corporation. Voting at meetings of stockholders need not be by written ballot. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect. All other elections and questions shall, unless otherwise provided by the certificate of incorporation, these by-laws, the rules or regulations of any stock exchange applicable to the corporation, as otherwise provided by law or pursuant to any regulation applicable to the corporation, be decided by the affirmative vote of the holders of a majority in voting power of the shares of stock of the corporation which are present in person or by proxy and entitled to vote thereon. Section 1.8. Fixing Date for Determination of Stockholders of Record. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date: (1) in the case of determination of stockholders entitled to vote at any meeting of stockholders or adjournment thereof, shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting; (2) in the case of determination of stockholders entitled to express consent to corporate action in writing without a meeting, shall not be more than ten (10) days from the date upon which the resolution fixing the record date is adopted by the Board of Directors, and (3) in the case of any other action, shall not be more than sixty (60) days prior to such other action. If no record date is fixed: (1) the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; (2) the record date for determining stockholders entitled to express consent to corporate action in writing without a meeting, when no prior action of the Board of Directors is required by law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation in accordance with applicable law, or, if prior action by the Board of Directors is required by law, shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action; and (3) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Section 1.9. List of Stockholders Entitled to Vote. The Secretary shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present. Upon the willful neglect or refusal of the directors to produce such a list at any meeting for the election of directors, they shall be ineligible for election to any office at such meeting. Except as otherwise provided by law, the stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list of stockholders or the books of the corporation, or to vote in person or by proxy at any meeting of stockholders. Section 1.10. Action By Written Consent of Stockholders. Unless otherwise restricted by the certificate of incorporation, any action required or permitted to be taken at any annual or special meeting of the stockholders may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the corporation having custody of the book in which minutes of proceedings of stockholders are recorded. Delivery made to the corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall, to the extent required by law, be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of holders to take the action were delivered to the corporation. Section 1.11. Inspectors of Election. The corporation may, and shall if required by law, in advance of any meeting of stockholders, appoint one or more inspectors of election, who may be employees of the corporation, to act at the meeting or any adjournment thereof and to make a written report thereof. The corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. In the event that no inspector so appointed or designated is able to act at a meeting of stockholders, the person presiding at the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath to execute faithfully the duties of inspector with strict impartiality and according to the best of his or her ability. The inspector or inspectors so appointed or designated shall (i) ascertain the number of shares of capital stock of the corporation outstanding and the voting power of each such share, (ii) determine the shares of capital stock of the corporation represented at the meeting and the validity of proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, and (v) certify their determination of the number of shares of capital stock of the corporation represented at the meeting and such inspectors' count of all votes and ballots. Such certification and report shall specify such other information as may be required by law. In determining the validity and counting of proxies and ballots cast at any meeting of stockholders of the corporation, the inspectors may consider such information as is permitted by applicable law. No person who is a candidate for an office at an election may serve as an inspector at such election. Section 1.12. Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of any meeting of stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the chairman of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to stockholders of record of the corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof, and (v) limitations on the time allotted to questions or comments by participants. Unless and to the extent determined by the Board of Directors or the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure. ARTICLE II Board of Directors Section 2.1. Number; Qualifications. The Board of Directors shall consist of one or more members, the number thereof to be determined from time to time by resolution of the Board of Directors. Directors need not be stockholders. Section 2.2. Election; Resignation; Vacancies. The Board of Directors shall initially consist of the persons named as directors in the certificate of incorporation or elected by the incorporator of the corporation, and each director so elected shall hold office until the first annual meeting of stockholders or until his successor is duly elected and qualified. At the first annual meeting of stockholders and at each annual meeting thereafter, the stockholders shall elect directors each of whom shall hold office for a term of one year or until his successor is duly elected and qualified, subject to such director's earlier death, resignation, disqualification or removal. Any director may resign at any time upon written notice to the corporation. Unless otherwise provided by law or the certificate of incorporation, any newly created directorship or any vacancy occurring in the Board of Directors for any cause may be filled by a majority of the remaining members of the Board of Directors, although such majority is less than a quorum, or by a plurality of the votes cast at a meeting of stockholders, and each director so elected shall hold office until the expiration of the term of office of the director whom he has replaced or until his successor is elected and qualified. Section 2.3. Regular Meetings. Regular meetings of the Board of Directors may be held at such places within or without the State of Delaware and at such times as the Board of Directors may from time to time determine. Section 2.4. Special Meetings. Special meetings of the Board of Directors may be held at any time or place within or without the State of Delaware whenever called by the President, any Vice President, the Secretary, or by any member of the Board of Directors. Notice of a special meeting of the Board of Directors shall be given by the person or persons calling the meeting at least twenty-four hours before the special meeting. Section 2.5. Telephonic Meetings Permitted. Members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting thereof by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this by-law shall constitute presence in person at such meeting. Section 2.6. Quorum; Vote Required for Action. At all meetings of the Board of Directors a majority of the whole Board of Directors shall constitute a quorum for the transaction of business. Except in cases in which the certificate of incorporation, these by-laws or applicable law otherwise provides, the vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Section 2.7. Organization. Meetings of the Board of Directors shall be presided over by the Chairman of the Board, if any, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in their absence by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting. Section 2.8. Action by Written Consent of Directors. Unless otherwise restricted by the certificate of incorporation or these by-laws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or such committee. ARTICLE III Committees Section 3.1. Committees. The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of the committee, the member of members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in place of any such absent or disqualified member. Any such committee, to the extent permitted by law and to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it. Section 3.2. Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board of Directors may make, alter and repeal rules for the conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board of Directors conducts its business pursuant to Article II of these by-laws. ARTICLE IV Officers Section 4.1. Executive Officers; Election; Qualifications; Term of Office; Resignation; Removal; Vacancies. The Board of Directors shall elect a President and Secretary, and it may, if it so determines, choose a Chairman of the Board and a Vice Chairman of the Board from among its members. The Board of Directors may also choose one or more Vice Presidents, one or more Assistant Secretaries, a Treasurer and one or more Assistant Treasurers. Each such officer shall hold office until the first meeting of the Board of Directors after the annual meeting of stockholders next succeeding his election, and until his successor is elected and qualified or until his earlier resignation or removal. Any officer may resign at any time upon written notice to the corporation. The Board of Directors may remove any officer with or without cause at any time, but such removal shall be without prejudice to the contractual rights of such officer, if any, with the corporation. Any number of offices may be held by the same person. Any vacancy occurring in any office of the corporation by death, resignation, removal or otherwise may be filled for the unexpired portion of the term by the Board of Directors at any regular or special meeting. Section 4.2. Powers and Duties of Executive Officers. The officers of the corporation shall have such powers and duties in the management of the corporation as may be prescribed in a resolution by the Board of Directors and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors. The Board of Directors may require any officer, agent or employee to give security for the faithful performance of his duties. ARTICLE V Stock Section 5.1. Certificates. Every holder of stock shall be entitled to have a certificate signed by or in the name of the corporation by the Chairman or Vice Chairman of the Board of Directors, if any, or the President or a Vice President, and by Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary, of the corporation certifying the number of shares owned by him in the corporation. Any of or all the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue. Section 5.2. Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates. The corporation may issue a new certificate of stock in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen or destroyed certificate, or his legal representative, to give the corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. ARTICLE VI Indemnification Section 6.1. Right to Indemnification. The corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person (an "Indemnitee") who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "proceeding"), by reason of the fact that he, or a person for whom he is the legal representative, is or was a director or officer of the corporation or, while a director or officer of the corporation, is or was serving at the written request of the corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such Indemnitee. Notwithstanding the preceding sentence, except as otherwise provided in Section 6.3, the corporation shall be required to indemnify an Indemnitee in connection with a proceeding (or part thereof) commenced by such Indemnitee only if the commencement of such proceeding (or part thereof) by the Indemnitee was authorized by the Board of Directors. Section 6.2. Prepayment of Expenses. The corporation shall pay the expenses (including attorneys' fees) incurred by an Indemnitee in defending any proceeding in advance of its final disposition, provided, however, that, to the extent required by law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by the Indemnitee to repay all amounts advanced if it should be ultimately determined that the Indemnitee is not entitled to be indemnified under this Article VI or otherwise. Section 6.3. Claims. If a claim for indemnification or advancement of expenses under this Article VI is not paid in full within sixty (60) days after a written claim therefor by the Indemnitee has been received by the corporation, the Indemnitee may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim. In any such action the corporation shall have the burden of proving that the Indemnitee is not entitled to the requested indemnification or advancement of expenses under applicable law. Section 6.4. Non-Exclusivity of Rights. The rights conferred on any Indemnitee by this Article VI shall not be exclusive of any other rights which such Indemnitee may have or hereafter acquire under any statute, provision of the certificate of incorporation, these by-laws, agreement, vote of stockholders or disinterested directors or otherwise. Section 6.5. Other Sources. The corporation's obligation, if any, to indemnify or to advance expenses to any Indemnitee who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such Indemnitee may collect as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, enterprise or non-profit enterprise. Section 6.6. Amendment or Repeal. Any repeal or modification of the foregoing provisions of this Article VI shall not adversely affect any right or protection hereunder of any Indemnitee in respect of any act or omission occurring prior to the time of such repeal or modification. Section 6.7. Other Indemnification and Prepayment of Expenses. This Article VI shall not limit the right of the corporation, to the extent and in the manner permitted by law, to indemnify and to advance expenses to persons other than Indemnitees when and as authorized by appropriate corporate action. ARTICLE VII Miscellaneous Section 7.1. Fiscal Year. The fiscal year of the corporation shall be determined by resolution of the Board of Directors. Section 7.2. Seal. The corporate seal shall have the name of the corporation inscribed thereon and shall be in such form as may be approved from time to time by the Board of Directors. Section 7.3. Manner of Notice. Except as otherwise provided herein, notices to directors and stockholders shall be in writing and delivered personally or mailed to the directors or stockholders at their addresses appearing on the books of the corporation. Notice to directors may be given by telegram, telecopier, telephone or other means of electronic transmission. Section 7.4. Waiver of Notice of Meetings of Stockholders, Directors and Committees. Any written waiver of notice, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at nor the purpose of any regular or special meeting of the stockholders, directors, or member of a committee of directors need be specified in any written waiver of notice. Section 7.5. Form of Records. Any records maintained by the corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or be in the form of, punch cards, magnetic tape, photographs, microphotographs, or any other information storage device, provided that the records so kept can be converted into clearly legible form within a reasonable time. Section 7.6. Amendment of By-Laws. These by-laws may be altered, amended or repealed, and new by-laws made, by the Board of Directors, but the stockholders may make additional by-laws and may alter and repeal any by-laws whether adopted by them or otherwise. EX-3.33 31 y98028exv3w33.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.33 STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FIELD 10:00 AM 09/22/1998 981366213 - 2946694 CERTIFICATE OF INCORPORATION OF UNILOY MILACRON INC. --------------------------------- A corporation organized pursuant to the General Corporation Law of the State of Delaware --------------------------------------------------------- ARTICLE I Name The name of the corporation (hereinafter called the "Corporation") is: Uniloy Milacron Inc. ARTICLE II Registered Office and Registered Agent The address of the Corporation's registered office in the State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle. The name of the Corporation's registered agent at such address is The Corporation Trust Company. ARTICLE III Business or Purposes To Be Conducted or Promoted The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware. 2 ARTICLE IV Capital Stock The total number of shares of all classes of capital stock which the Corporation shall have authority to issue is 10,000 shares of Common Stock, and the par value of each of such shares is $1.00 amounting in the aggregate to $10,000. ARTICLE V Incorporator The name and mailing address of the sole incorporator of the Corporation is as follows: Hugh C. O'Donnell 4701 Marburg Avenue Cincinnati, Ohio 45209 ARTICLE VI Business and Affairs of the Corporation For the management of the business and for the conduct of the affairs of the Corporation, and in further definition, limitation and regulation of the powers of the Corporation and its directors and stockholders, it is further provided that: (a) the number of directors of the Corporation shall be fixed by, or in the manner provided in, the By-laws of the Corporation; (b) in furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Corporation, in the By-laws, may authorize and empower the Board of Directors to make, alter, amend or repeal from time to time the By-laws of the Corporation in any manner not inconsistent with the laws of the State of Delaware or this Certificate of Incorporation, subject to the right of the stockholders of the Corporation entitled to vote with respect there to alter, amend or repeal the By-laws of the Corporation; (c) in addition to the powers and authorities herein or by statute expressly conferred upon it, the Board of Directors may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the laws of the State of Delaware, of this Certificate of Incorporation and of the By-laws of the Corporation; 3 (d) unless and except to the extent that the By-laws of the Corporation shall so require, the election of directors of the Corporation need not be by written ballot; and (e) any director or any officer of the Corporation elected or appointed by its stockholders or by its Board of Directors, or any committee thereof, may be removed at any time by a unanimous consent of the stockholders or in such other manner as shall be provided in the By-laws, except as otherwise provided by law. ARTICLE VII Indemnification To the fullest extent that the General Corporation Law of the State of Delaware as it exists on the date hereof or as it may hereafter be amended permits the limitation or elimination of the liability of directors, no director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. No amendment to or repeal of this Article shall apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect to any acts or omissions of such director prior to such amendment or repeal. ARTICLE VIII Amendment The Corporation reserves the right at any time and from time to time to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, and other provisions authorized by the laws of the State of Delaware at the time in force or as may hereafter be added or inserted, in the manner now or hereafter prescribed by law and consistent with Article VII as now in force; and all rights, preferences and privileges of whatsoever nature conferred upon stockholders, directors or any other persons whomsoever by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended are granted subject to the right reserved in this Article. 4 I, the undersigned, being the sole incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the General Corporation Law of the State of Delaware, do make this certificate, hereby declaring and certifying, under penalties of perjury, that this is my act and deed and the facts herein stated are true, and accordingly have hereunto set my hand as of this 21st day of September, 1998. /s/ Hugh C. O'Donnell --------------------------- Hugh C. O'Donnell Incorporator EX-3.34 32 y98028exv3w34.txt BYLAWS EXHIBIT 3.34 BY-LAWS of UNILOY MILACRON INC. ARTICLE I Offices SECTION 1.1. Offices. Uniloy Milacron Inc. (the "Corporation") may have offices either within or without the State of Delaware. The registered office of the Corporation and the name of the registered agent of the Corporation are as is set forth in the Certificate of Incorporation of the Corporation, or as may subsequently be or have been changed by resolution of the Board of Directors (the "Board"). ARTICLE II Meetings of Stockholders SECTION 2.1. Annual Meetings. An annual meeting of the stockholders of the Corporation for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held on such date as the Board may from time to time determine, and at such place and hour as shall be designated by the Board in the notice thereof. SECTION 2.2. Special Meetings. A special meeting of the stockholders for any purpose or purposes may be called at any time by the Board and such meeting shall be held on such date and at such place and hour as shall be designated in the notice thereof. SECTION 2.3. Notice of Meetings. Notice of each meeting of the stockholders shall be given not less than 10 nor more than 60 days before the date of the meeting to each stockholder of record entitled to notice of, or to vote at, such meeting by delivering a typewritten or printed notice thereof to such stockholder personally or by depositing such notice in the United States mail, postage prepaid, directed to such stockholder at his address as it appears on the stock record of the Corporation. Every such notice shall state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called. SECTION 2.4. Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty days, or if after the 2 adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. SECTION 2.5. Quorum and Manner of Acting. The presence in person or by proxy of stockholders holding of record a majority of the shares of stock of the Corporation entitled to be voted shall constitute a quorum for the transaction of business at any meeting of the stockholders. In the absence of a quorum at any such meeting or any adjournment or adjournments thereof, a majority in voting interest of those present in person or by proxy and entitled to vote thereat, or, in the absence therefrom of all the stockholders, any officer entitled to preside at, or to act as secretary of, such meeting, may adjourn such meeting from time to time in the manner provided in Section 2.4 until stockholders holding the amount of stock requisite for a quorum shall be present in person or by proxy. The absence from any meeting in person or by proxy of stockholders holding the number of shares of stock of the Corporation required for action upon any given matter, shall not prevent action at such meeting upon any other matter which may properly come before the meeting if there shall be present thereat, in person or by proxy, stockholders holding the number of shares of stock of the Corporation required in respect of such other matter. SECTION 2.6. Organization of Meetings. At each meeting of the stockholders, one of the following shall act as chairman of the meeting and preside thereat, in the following order of precedence: (a) the Chairman of the Board, or, if he is not present or if no person holds such office, any officer of the Corporation designated by the Board; or (b) any officer of the Corporation designated by a majority in voting interest of the stockholders present in person or by proxy and entitled to vote thereat. The person whom the chairman of the meeting shall appoint, shall act as secretary of the meeting and keep the minutes thereof. SECTION 2.7. Order of Business. The order of business at each meeting of the stockholders shall be determined by the chairman of the meeting, but such order of business may be changed by a majority in voting interest of those present in person or by proxy at such meeting and entitled to vote thereat. SECTION 2.8. Voting. Each stockholder shall, at each meeting of the stockholders, be entitled to one vote in person or by proxy for each share of stock of the Corporation which has voting power on the matter in question held by him and registered in his name on the stock record of the Corporation: (a) on the date fixed pursuant to the provisions of Section 8.6 of Article VIII of these By-laws as the record date for the determination of stockholders who shall be entitled to receive notice of and to vote at such meeting; or (b) if no record date shall have been so fixed, then at the close of business on the day next preceding the day on which notice of the meeting shall be given or, if notice 3 of the meeting shall be waived, at the close of business on the day next preceding the day on which the meeting shall be held, or if no record date for determining stockholders entitled to express consent to corporate action in writing without a meeting shall have been fixed, the day on which the first written consent is expressed. Shares of its own stock belonging to the Corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the Corporation, shall neither be entitled to vote nor be counted for quorum purposes. Any vote of stock of the Corporation may be given at any meeting of the stockholders by the person entitled to vote the same in person or by proxy appointed by an instrument in writing delivered to the secretary of the meeting; provided however, that no proxy shall be voted or acted upon after three years from its date unless such proxy provides for a longer period. The attendance at any meeting of a stockholder who may theretofore have given a proxy shall not have the effect of revoking the same unless he shall in writing so notify the secretary of the meeting prior to voting of the proxy. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect. All other elections and questions shall, unless otherwise provided by these By-laws, be decided by the vote of the holders of shares of stock having a majority of the votes which could be cast by the holders of all shares of stock entitled to vote thereon which are present in person or represented by proxy at the meeting. Unless otherwise directed by the chairman of the meeting, the vote at any meeting of the stockholders on any question need not be by ballot. On a vote by ballot, each ballot shall be signed by the stockholder voting, or by his proxy if there be such proxy, and shall state the number of share voted. SECTION 2.9. Consent in Lieu of Meeting. Anything herein to the contrary notwithstanding, any action required to be taken at any annual or special meeting of stockholders of the Corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken at any annual or special meeting of such stockholders or may be taken without a meeting and without a vote if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and any certificate filed with respect to such matter shall state that such written notice has been given. SECTION 2.10. List of Stockholders. It shall be the duty of the officer of the Corporation who shall have charge of the stock ledger of record, either directly or through another officer of the Corporation or agent thereof, to prepare and make, at least 10 days before every meeting of the stockholders, a complete list of the stockholders entitled to vote thereat, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours for a period of at least 10 days prior to the meeting, either at the place where the meeting is to be held or at such other place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting. Such list shall also be produced and kept at the time and place of the 4 meeting during the whole time thereof and may be inspected by any stockholder who is present. The stock record shall be the only evidence as to who are the stockholders entitled to examine the stock record, such list or the books of the Corporation or to vote in person or by proxy at any meeting of the stockholders. SECTION 2.11. Inspectors. Either the Board or, in the absence of a designation of inspectors by the Board, the chairman of the meeting may, in its or his discretion, appoint two or more inspectors, who need not be stockholders, who shall receive and take charge of ballots and proxies and decide all questions relating to the qualification of those asserting the right to vote and the validity of ballots and proxies. In the event of the failure or refusal to serve of any inspector designated by the Board, the chairman of the meeting shall appoint an inspector to act in place of each such inspector designated by the Board. In the absence of a designation of inspectors by the Board and the chairman of the meeting, the secretary of the meeting shall perform the duties which would otherwise have been performed by the inspectors. ARTICLE III Board of Directors SECTION 3.1. General Powers. The property, business, affairs and policies of the Corporation shall be managed by or under the direction of the Board. SECTION 3.2. Number and Term of Office. The number of directors which shall constitute the Board shall be one or more persons as such number shall be fixed from time to time by a vote of a majority of the Board. Each of the directors of the Corporation shall hold office until the annual meeting after his election and until his successor shall be elected and shall qualify or until his earlier death or resignation or removal in the manner hereinafter provided. SECTION 3.3. Election. Except as provided in Section 3.6 of this Article III, directors shall be elected by a plurality of the votes cast at annual meetings of stockholders, and each director so elected shall hold office until the next annual meeting and until his successor is duly elected and qualified, or until his earlier death, resignation or removal. Directors need not be stockholders of the Corporation or residents of the State of Delaware. SECTION 3.4. Meetings. (a) Regular Meetings. Regular meetings of the Board or any committee thereof shall be held as the Board or such committee thereof shall from time to time determine. If any day fixed for a regular meeting shall be a legal holiday at the place where the meeting is to be held, then the meeting which would otherwise be held on that day, shall be postponed until the next succeeding business day. (b) Special Meetings. Special meetings of the Board, at which any and all business may be transacted, shall be held whenever called by President, Chairman or any two directors. (c) Notice of Meetings. No notice of regular meetings of the Board or of any committee thereof or of any adjourned meeting thereof need be given. Notice shall be 5 given to each director of each special meeting of the Board or adjournment thereof, including the time and place thereof. Notice of each such meeting shall be mailed to each director, addressed to him at his residence or usual place of business, at least two days before the day on which such meeting is to be held, or shall be sent to him at such place by facsimile, telegraph, cable, wireless or other form of recorded communication, or be delivered personally or by telephone not later than the day before the day on which such meeting is to be held, but notice need not be given to any director who shall attend such meeting. A written waiver of notice, signed by the person entitled thereto, whether before or after the time of the meeting stated therein, shall be deemed equivalent to notice. The purposes of a meeting of the Board or any committee thereof need not be specified in the notice thereof. (d) Time and Place of Meetings. Regular meetings of the Board or any committee thereof shall be held at such time or times and place or places as the Board or such committee may from time to time determine. Each special meeting of the Board or any committee thereof shall be held at such time and place as the caller or callers thereof may determine. In the absence of such a determination, each regular meeting or special meeting of the Board or any committee thereof shall be held at such time and place as shall be designated in the notices or waiver of notices thereof. (e) Quorum and Manner of Acting. A majority of the directors then in office and a majority of the members of any committee shall be present in person at any meeting thereof in order to constitute a quorum for the transaction of business at such meeting and the vote of a majority of the directors present at any such meeting at which a quorum is present shall be necessary for the passage of any resolution or for an act to be the act of the Board or such committee. In the absence of a quorum, a majority of the directors present thereat may adjourn such meeting from time to time until a quorum shall be present thereat. Notice of any adjourned meeting need not be given. (f) Organization of Meetings. At each meeting of the Board, the Chairman of the Board or, if he is not present or if no person holds such office, any director chosen by a majority of the directors present thereat shall act as chairman of the meeting and preside thereat. The person whom the chairman of the meeting shall appoint shall act as secretary of such meeting and keep the minutes thereof. The order of business at each meeting of the Board shall be determined by the chairman of such meeting. (g) Consent in Lieu of Meetings. Anything herein to the contrary notwithstanding, any action required or permitted to be taken at any meeting of the Board or any committee thereof, may be taken without a meeting if all members of the Board or such committee, as the case may be, consent thereto in a writing or writings and such writing or writings are filed with the minutes of the proceedings of the Board or such committee. (h) Action by Communications Equipment. The directors may participate in a meeting of the Board or any committee thereof by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other and such participation shall constitute presence in person at such meeting. 6 SECTION 3.5. Compensation. Each director, in consideration of his serving as such, shall be entitled to receive from the Corporation such amount per annum and such fees for attendance at meetings of the Board or of any committee, or both, as the Board shall from time to time determine. The Board may likewise provide that the Corporation shall reimburse each director or member of a committee for any expenses incurred by him on account of his attendance at any such meeting. Nothing contained in this Section shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. SECTION 3.6. Resignation, Removal and Vacancies. Any director may resign at any time by giving written notice of his resignation to the Board. Any such resignation shall take effect at the time specified therein or, If the time when it shall become effective shall not be specified therein, when accepted by the Board. Except as aforesaid, the acceptance of such resignation shall not be necessary to make it effective. Any director may be removed at any time for cause or without cause by vote of the holders of a majority in voting interest of shares then entitled to vote at an election of directors. The vacancy in the Board caused by any such removal may be filled by the stockholders at such meeting or as provided in the next paragraph of these By-laws. Any director may also be removed at any time for cause by vote of a majority of the Board. In the case of any vacancy on the Board or in the case of any newly created directorship, a director to fill the vacancy or the newly created directorship for the unexpired portion of the term being filed may be elected by a majority of the directors of the Corporation then in office, though less than a quorum, or by a sole remaining director. The director elected to fill such vacancy shall hold office of the unexpired term in respect of which such vacancy occurred and until his successor shall be elected and shall qualify or until his earlier death or resignation or removal in the manner herein provided. ARTICLE IV Committees SECTION 4.1 Number, Appointment, Term of Office, etc. The Board, by resolution or resolutions passed by a majority of the Board, may designate one or more committees, each committee to consist of one or more directors then in office. Each member of any such committee shall continue as such only so long as he remains a director and may be removed at any time, with or without cause, by a majority of the Board. Any vacancy on any committee may be filled at any time by the vote of a majority of the Board. In the absence or in case of the disqualification of a member or members of any such committee, the member or members of such committee present and not disqualified from voting at a meeting of such committee, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board to act at such meeting in place of any absent or disqualified member. 7 SECTION 4.2. Functions and Powers. Each committee shall have such functions and powers as the Board shall deem advisable and, subject to any limitations or restrictions which may be prescribed by resolution of the Board, if an Executive Committee is designated, it shall have and may exercise all the powers and authority of the Board in the management of the property, business, affairs and policies of the Corporation, including the power and authority to declare dividends and to a authorize the issuance of stock of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it. SECTION 4.3. Rules. Subject to the provisions of these By-laws, each committee by resolution adopted by a majority of all the members thereof shall fix its rules of procedure. ARTICLE V Officers SECTION 5.1. Election and Appointment and Term of Office. The Corporation shall have such officers with such titles as shall be stated in a resolution of the Board, and with such duties as shall be given them as hereinafter provided or as may otherwise be specifically given them by the Board, but such officers shall include at least (a) a Chairman of the Board or one or more Vice-Chairman of the Board or a President or one or more Vice Presidents, or any or all the foregoing, and (b) a Secretary or one or more Assistant Secretaries or a Treasurer or one or more Assistant Treasurers, or any or all of the foregoing. One of such officers shall have the duty to record the proceedings of the meetings of stockholders and directors in a book to be kept for that purpose. Any number of offices may be held by the same person except that at least one person who holds an office referred to in clause (a) of the second preceding sentence shall not be the same as at least one person who holds any office referred to in clause (b) of the second preceding sentence. SECTION 5.2. Resignation, Removal and Vacancies. Any officer may resign at any time by giving written notice of his resignation to the Board. Any such resignation shall take effect at the time specified therein or, if the time when it shall become effective shall not be specified therein, when accepted by the Board. Except as aforesaid, the acceptance of such resignation shall not be necessary to make it effective. Any officer, agent or employee elected or appointed by the Board may be removed, with or without cause, at any time by the Board. Any agent or employee appointed by an officer may be removed, with or without cause, at any time by such officer. A vacancy in any office may be filled for the unexpired portion of the term in the same manner as provided in these By-laws for election or appointment to such office. SECTION 5.3. Duties and Functions. If any of the following offices is created and a person appointed or elected thereto, and unless the Board otherwise provides, such offices and person shall have the following duties and functions: 8 (a) Chairman. If a Chairman of the Board is appointed or elected, he shall be a member of the Board; shall preside at meetings of the Board and of the stockholders at which he shall be present; shall perform such duties as are incident to the office of the Chairman of the Board; and shall perform such other duties as may from time to time be prescribed by the Board. (b) Vice-Chairman. If any Vice-Chairman or Vice-Chairmen of the Board are appointed or elected, they shall be members of the Board; shall preside at meetings of the Board and of the stockholders, unless a Chairman of the Board is appointed or elected and is present; shall perform such duties as are incident to the office of the Vice-Chairman of the Board; and shall perform such other duties as may from time to time be prescribed by the Board. (c) Chairman of the Executive Committee. If a Chairman of the Executive Committee Is appointed or elected, he shall preside at meetings of the Executive Committee; shall when requested consult with and advise the other officers of the Corporation; and shall perform such other duties as may be agreed upon with them or as the Board or the Executive Committee may from time to time determine. (d) President. If a President is appointed or elected, he shall, subject to the control of the Board, have general charge and management of the properly, business and affairs of the Corporation and shall have the direction of and may assign duties to all other officers (other than the Chairman and any Vice-chairman, if either or both is appointed or elected), agents and employees. He shall preside at meetings of the Board and the stockholders unless a Chairman or a Vice-Chairman of the Board is appointed or elected and is present. (e) Vice Presidents. If any Vice President or Vice Presidents are appointed or elected, they shall have such powers and duties as shall be prescribed by the President, if one is appointed or elected, or the Board. Vice Presidents for this purpose shall include Senior, Executive, Assistant and all other categories or types of Vice Presidents. (f) Secretary. If a Secretary is appointed or elected, he shall attend and keep the records of all meetings of the stockholders and the Board in one or more books kept for that purpose; shall give or cause to be given due notice of all meetings in accordance with these By-laws and as required by law; shall notify the several officers of the Corporation of all action taken by the Board concerning matters relating to their duties; shall transmit to the proper officers copies of all contracts and resolutions approved by the Board or any committees of the Board; shall be custodian of the seal of the Corporation and of all contracts, deeds, documents and other corporate papers, records (except accounting records) and indicia of title to properties owned by the Corporation as shall not be committed to the custody of another officer by the President, if one is appointed or elected, or the Board; shall affix or cause to be affixed the seal of the Corporation to instruments requiring the same when the same have been signed on behalf of the Corporation by a duly authorized officer; shall perform all duties and have all powers incident to the office of Secretary; and shall perform such other duties as shall be assigned to him by the President, if one is appointed or elected, or the Board. One or more Assistant Secretaries may be appointed or elected, who shall perform all the duties and have all the powers of the Secretary in the absence of or in case of a failure to 9 appoint or elect or when so delegated by the Secretary, and as the President, if one is appointed or elected, or the Board may direct. (g) Treasurer. If a Treasurer is appointed or elected, he shall perform all duties incident to the office of Treasurer and such other duties as shall be assigned to him by the President, if one is appointed or elected, or the Board. One or more Assistant Treasurers may be appointed or elected who shall perform all the duties and have all the powers of the Treasurer in the absence of or in the case of a failure to appoint or elect or when so delegated by the Treasurer, and as the President if one is appointed or elected, or the Board may direct. (h) Controller. If a Controller is appointed or elected, he shall perform all the duties incident to the office of Controller and such other duties as may be assigned to him by the President, if one is appointed or elected, or the Board. One or more Assistant Controllers may be appointed or elected who shall perform all the duties and have all the powers of the Controller in the absence of or in the case of a failure to appoint or elect or when so delegated by the Controller, and as the President, if one is appointed or elected, or the Board may direct. ARTICLE VI Waiver of Notices; Place of Meetings SECTION 6.1. Waiver of Notices. Anything herein to the contrary notwithstanding, whenever notice is required to be given to any director or member of a committee or stockholder, a waiver thereof in writing, signed by the person entitled to such notice shall be deemed equivalent to notice, whether given before or after the time specified therein and, in the case of a waiver of notice of a meeting, whether or not such waiver specifies the purpose of or business to be transacted at such meeting. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except where the person attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened, and does so object. SECTION 6.2. Place of Meetings. Any meeting of the stockholders, the Board or any committee may be held within or without the State of Delaware. ARTICLE VII Execution and Delivery of Documents; Deposits; Proxies; Books and Records SECTION 7.1. Execution and Delivery of Documents; Delegation. The Board shall designate the officers, employees and agents of the Corporation who shall have power to execute and deliver deeds, contracts, mortgages, bonds, debentures, checks, drafts and other orders for the payment of money and other documents for and in the name of the Corporation and may authorize such officers, employees and agents to delegate such power (including authority to redelegate) by written instrument to other officers, employees or agents of the Corporation. Such delegation may be by resolution 10 or otherwise and the authority granted shall be general or confirmed to specific matters, all as the Board may determine. In the absence of such designation referred to in the first sentence of this Section, the officers of the Corporation shall have such power so referred to, to the extent incident to the normal performance of their duties. SECTION 7.2. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation or otherwise as the Board or any officer of the Corporation to whom power in that respect shall have been delegated by the Board shall select. SECTION 7.3. Proxies in Respect of Stock or Other Securities of Other Corporations. Unless otherwise provided by the Board, any officer of the Corporation shall have the authority from time to time to appoint an agent or agents of the Corporation to exercise in the name and on behalf of the Corporation the powers and rights which the Corporation may have as the holder of stock or other securities in any other corporation, to vote or consent in respect of such stock or securities and to execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal or otherwise, such written proxies, powers of attorney or other instruments as he may deem necessary or proper in order that the Corporation may exercise such powers and rights. Such officer may instruct any person or persons appointed as aforesaid as to the manner of exercising such powers and rights. SECTION 7.4. Books and Records. The books and records of the Corporation may be kept at such places within or without the State of Delaware as the proper officers of the Corporation may from time to time determine. ARTICLE VIII Certificates; Stock Record; Transfer and Registration; New Certificates; Record Date, etc. SECTION 8.1. Certificates for Stock. Every holder of stock of the Corporation shall be entitled to have a certificate certifying the number of shares owned by him in the Corporation and designating the class of stock to which such shares belong, Which shall otherwise be in such form as the Board shall prescribe. Each such certificate shall be signed by, or in the name of the Corporation by, the Chairman, a Vice-Chairman, the President or a Vice President of the Corporation and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of the Corporation. Any of or all such signatures may be facsimiles. In case any officer or authorized agent who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer or authorized agent before such certificate is issued, it may nevertheless be issued by the Corporation with the same effect as if he were such officer or authorized agent at the date of issue. Every certificate surrendered to the Corporation for exchange or transfer shall be canceled and a new certificate or certificates shall not be issued in exchange for any existing certificate until such existing certificate shall have been so canceled, except in cases provided for in Section 8.4 of this Article. SECTION 8.2. Stock Record. A stock record in one or more counterparts shall be kept of the name of the person, firm or corporation owning the stock represented by 11 each certificate for stock of the Corporation issued, the number of shares represented by each such certificate, the date thereof and, in the case of cancellation, the date of cancellation. The person in whose name shares of stock stand on the stock record of the Corporation shall be deemed the owner thereof for all purposes as regards the Corporation. SECTION 8.3. Transfer and Registration of Stock. (a) Transfer. The transfer of stock and certificates of stock which represent the stock of the Corporation shall be governed by Article 8 of Subtitle I of Title 6 of the Delaware Code (as amended from time to time, the "Uniform Commercial Code"). (b) Registration. Registration of transfers of shares of the Corporation shall be made only on the books of the Corporation by the registered holder thereof, or by his attorney thereunto authorized by power of attorney duly executed and filed with an officer of the Corporation, and on the surrender of the certificate or certificates for such shares properly endorsed or accompanied by a stock power duly executed. SECTION 8.4. New Certificates (a) Lost, Stolen or Destroyed Certificates. Where a stock certificate has been lost, apparently destroyed or wrongfully taken, the issuance of a new stock certificate or the claims based on such certificate shall be governed by the Uniform Commercial code. (b) Mutilated Certificates. Where the holder of any certificate for stock of the Corporation notifies the Corporation of the mutilation of such certificate within a reasonable time after he has notice of it, the Corporation will issue a new certificate for stock in exchange for such mutilated certificate theretofore issued by it. (c) Bond. The Board may, in its discretion, require the owner of the lost, stolen, destroyed or mutilated certificate to give the Corporation a bond in such sum, limited or unlimited, in such form and with such surety or sureties sufficient to Indemnify the Corporation against any claim that may be made against it on account of the loss, theft, destruction or mutilation of any such certificate or the issuance of any such new certificate. SECTION 8.5. Regulations. The Board may make such rules and regulations as it may deem expedient, concerning the issue, transfer and registration of certificates for stock of the Corporation. SECTION 8.6. Fixing Date for Determination of Stockholders of Record. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other Lawful action, the Board may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days before the date of such meeting, nor more than 60 days prior to any other action. A determination of stockholders entitled to notice of or to vote at a meeting of the stockholders shall apply to any adjournment of the meeting; provided, however that the Board may fix a new record date for the adjourned meeting. 12 ARTICLE IX Seal SECTION 9.1. Seal. The Board shall provide a corporate seal which shall be in the form of a circle and shall bear the full name of the Corporation and the word "Delaware". ARTICLE X Fiscal Year SECTION 10.1. Fiscal Year. The fiscal year of the Corporation shall end on the last day of December in each year, or such other date as the Board may determine. ARTICLE XI Amendments SECTION 11.1. Amendments. These By-laws may be amended, altered or repealed by the vote of a majority of the Board, subject to the power of the holders of a majority of the outstanding stock of the Corporation entitled to vote in respect thereof, by their vote given at an annual meeting or at any special meeting, to amend, alter or repeal any By-law made by the Board. ARTICLE XII Subject to Law SECTION 12.1. Subject to Law. All provisions of these By-laws are subject to requirements of applicable law and the Certificate of Incorporation of the Corporation. ARTICLE XIII Indemnification SECTION 13.1 Indemnification of Officers and Directors. The Corporation shall indemnify each of its directors or officers, who shall serve as a director or officer of this Corporation or of any other corporation at the request of this Corporation, to the fullest extent permitted under and in accordance with the laws of the State of Delaware. 13 ARTICLE XIV INTERESTED DIRECTORS SECTION 14.1 Interested Directors; Quorum. No contract or transaction between the corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers, or have a financial Interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or committee thereof which authorizes the contract or transaction, or solely because his or their votes are counted for such purposes, if: (1) the material facts as to his relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (2) the material facts as to his relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (3) the contract or transaction is fair as to the corporation as of the time it is authorized, approved or ratified, by the Board of Directors, a committee thereof, or the stockholders. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction. EX-3.35 33 y98028exv3w35.txt ARTICLES OF INCORPORATION EXHIBIT 3.35 MICHIGAN DEPARTMENT OF COMMERCE -- CORPORATION AND SECURITIES BUREAU (FOR BUREAU USE ONLY) Date Received FILED JUN 21 1984 JUN 21 1984 Administrator MICHIGAN DEPT. OF COMMERCE EFFECTIVE DATE: Corporation & Securities Bureau CORPORATION IDENTIFICATION NUMBER 322-156 ARTICLES OF INCORPORATION FOR USE BY DOMESTIC PROFIT CORPORATIONS (Please read instructions on last page before completing form) Pursuant to the provisions of Act 284, Public Acts of 1972, as amended, the undersigned corporation executes the following Articles: ARTICLE I The name of the corporation is: PLASTICS U.S.A. CORPORATION ARTICLE II The purpose or purposes for which the corporation is organized is to engage in any activity within the purposes for which corporations may be organized under the Business Corporation Act of Michigan. ARTICLE III The total authorized capital stock is: Common Shares 50,000 Par Value Per Share $ 1.00 1. Preferred Shares -0- Par Value Per Share $ -0- and/or shares without par value as follows: Common Shares -0- Stated Value Per Share $ -0- 2. Preferred Shares -0- Stated Value Per Share $ -0- 3. A statement of all or any of the relative rights, preferences and limitations of the shares of each class is as follows: All shares are equal in all respects. GOLD SEAL APPEARS ONLY ON ORIGINAL ARTICLE IV 1. The address of the registered office is 1500 West Grand River Avenue Williamston, Michigan 48895 (Street Address) (City) (Zip Code) 2. The mailing address of the registered office if different than above: _____________________ _________________________, Michigan __________ (PO Box) (City) (Zip Code) 3. The name of the resident agent at the registered office is: Clifford G. Baker ARTICLE V The name(s) and address(es) of the incorporator(s) is (are) as follows: Name Residence or Business Address James R. Beuche 126 S. Main St. Ann Arbor, MI 48104 ARTICLE VI (OPTIONAL, DELETE IF NOT APPLICABLE) When a compromise or arrangement or a plan of recognization of this corporation is proposed between this corporation and its creditors or any class of them or between this corporation and its shareholders or any class of them, a court of equity jurisdiction within the state, on application of this corporation or of a creditor or shareholder thereof, or on application of a receiver appointed for the corporation, may order a meeting of the creditors or class of creditors or of the shareholders or class of shareholders to be affected by the proposed compromise or arrangement or reorganization, to be summoned in such manner as the court directs. If a majority in number representing 3/4 in value of the creditors or class of creditors, or of the shareholders or class of shareholders to be affected by the proposed compromise or arrangement or a reorganization, agree to a compromise or arrangement or a reorganization of this corporation as a consequence of the compromise or arrangement, the compromise or arrangement and the reorganization, if sanctioned by the court to which the application has been made shall be binding on all the creditors or class of creditors, or on all the shareholders or class of shareholders and also on this corporation. ARTICLE VII (OPTIONAL, DELETE IF NOT APPLICABLE) Any action required or permitted by the Act to be taken at an annual or special meeting of shareholders may be taken without a meeting, without prior notice and without a vote. If a consent in writing, setting forth the action so taken, is signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to shareholders who have not consented in writing. GOLD SEAL APPEARS ONLY ON ORIGINAL Use space below for additional Articles or for continuation of previous Articles. Please identify any Article being continued or added. Attach additional pages if needed. I, the incorporator(s) sign my name this 21st day of June, 1984. /s/ James R. Beuche - -------------------------------- James R. Beuche ___________________________________ _______________________________________ ___________________________________ _______________________________________ ___________________________________ _______________________________________ ___________________________________ _______________________________________ ___________________________________ _______________________________________ GOLD SEAL APPEARS ONLY ON ORIGINAL DOCUMENT WILL BE RETURNED TO NAME AND MAILING ADDRESS INDICATED IN THE BOX BELOW. Include name, street and number (or P.O. box), city, state and ZIP code. James R. Beuche Telephone: HOOPER, HATHAWAY, PRICE, BEUCHE & WALLACE Area Code (313) 126 S. Main St. Number 662-4426 Ann Arbor, MI 48104 INFORMATION AND INSTRUCTIONS 1. Submit one original copy of this document. Upon filing, a microfilm copy will be prepared for the records of the Corporation and Securities Bureau. The original copy will then be returned to the address appearing in the box above as evidence of filing. Since this document must be microfilmed, it is important that the filing be legible. Documents with poor black and white contrast, or otherwise illegible, will be rejected. 2. This document is to be used pursuant to the provisions of Act 284, P.A. of 1972, by one or more persons for the purpose of forming a domestic profit corporation. 3. Article I -- The corporate name of a domestic profit corporation is required to contain one of the following words or abbreviations: "Corporation", "Company", "Incorporated", "Limited", "Corp.", "Co.", "Inc.", or "Ltd.". 4. Article II -- State, in general terms, the character of the particular business to be carried on. Under section 202(b) of the Act, it is sufficient to state substantially, alone or without specifically enumerated purposes, that the corporation may engage in any activity within the purposes for which corporations may be organized under the Act. The Act requires, however, that educational corporations state their specific purposes. 5. Article III (2) -- The Act requires the incorporators of a domestic corporation having shares without par value to submit in writing the amount of consideration proposed to be received for each share which shall be allocated to stated capital. Such stated value may be indicated either in item 2 of article III or in a written statement accompanying the articles of incorporation. 6. Article IV -- A post office box may not be designated as the address of the registered office. The mailing address may differ from the address of the registered office only if a post office box address in the same city as the registered office is designated as the mailing address. 7. Article V -- The Act requires one or more incorporators. The address(es) should include a street number and name (or other designation), city and state. 8. The duration of the corporation should be stated in the articles only if the duration is not perpetual. 9. This document is effective on the date approved and filed by the Bureau. A later effective date, no more than 90 days after the date of delivery, may be stated as an additional article. 10. The articles must be signed in ink by each incorporator. The names of the incorporators as set out in article V should correspond with the signatures. 11. FEES: Filing fee................................................................ $10,00 Franchise fee -- 1/2 mill (.0005) on each dollar of authorized capital stock, with a minimum franchise fee of ................................... $25.00 Total minimum fees [Make remittance payable to state of michigan)................. $35.00

12 Mail form and fee to: Michigan Department of Commerce Corporation and Securities Bureau Corporation Division P.O. Box 30054 Lansing. Ml 48909 Telephone: (517) 373-0493 GOLD SEAL APPEARS ONLY ON ORIGINAL [ILLEGIBLE] MICHIGAN DEPARTMENT OF CONSUMER AND INDUSTRY SERVICES CORPORATION, SECURITIES AND LAND DEVELOPMENT BUREAU DATE RECEIVED (FOR BUREAU USE ONLY) This document is effective on the date filed, unless a subsequent effective date within 90 days after received date is stated in the document. Name A. STUART TOMPKINS Address P. O. BOX 222 City State Zip Code SOUTHFIELD MI 48037-0222 EFFECTIVE DATE Document will be returned to the name and address you enter above. If left blank document will be mailed to the registered office. CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION FOR USE BY DOMESTIC PROFIT AND NONPROFIT CORPORATIONS (Please read information and instructions on the last page) Pursuant to the provisions of Act 284, Public Acts of 1972 (profit corporations), or Act 162, Public Acts of 1982 (nonprofit corporations), the undersigned corporation executes the following Certificate: 1. The present name of the corporation is: Plastics U.S.A. Corporation 2. The identification number assigned by the Bureau is: 322-156 3. Article 1 of the Articles of Incorporation is hereby amended to read as follows: The name of the corporation is: Uniloy Milacron U.S.A. Inc. GOLD SEAL APPEARS ONLY ON ORIGINAL COMPLETE ONLY ONE OF THE FOLLOWING: 4. (For amendments adopted by unanimous consent of incorporators before the first meeting of the board of directors or trustees.) The foregoing amendment to the Articles of Incorporation was duly adopted on the _____________ day of ______________, 19 ____________, in accordance with the provisions of the Act by the unanimous consent of the incorporator(s) before the first meeting of the Board of Directors or Trustees. Signed this _____________ day of _____________, 19 ___________ ______________________________ ______________________________ (Signature) (Signature) ______________________________ ______________________________ (Type or Print name) (Type or Print name) ______________________________ ______________________________ (Signature) (Signature) ______________________________ ______________________________ (Type or Print name) (Type or Print name) 5. (For profit and nonprofit corporation whose Articles state the corporation is organized on a stock or on a membership basis.) The foregoing amendment to the Articles of Incorporation was duly adopted on the 8th day of August, 2001 by the shareholders if a profit corporation, or by the shareholder or members if a nonprofit corporation (check one of the following) [ ] at a meeting the necessary votes were cast in favor of the amendment. [ ] by written consent of the shareholders or members having not less than the minimum number of votes required by statute in accordance with Section 407(1) and (2) of the Act if nonprofit corporation, or Section 407(1) of the Act if a profit corporation. Written notice to shareholders or members who have not consented in writing has been given. (Note: Written consent by less than all of the shareholders or members is permitted only if such provision appears in the Articles of Incorporation.) [x] by written consent of all shareholders or members entitled to vote in accordance with section 407(3) of the Act if a nonprofit corporation, or Section 407(2) of the Act if a profit corporation. [ ] by the board of a profit corporation pursuant to section 811(2). Profit Corporations Nonprofit Corporations Signed this 8th day of August, 2001 Signed this ____ day of _____, 19___ By /s/ H. C. O'Donnell ------------------------------ By ________________________________________ (Signature of an authorized (Signature of President, Vice-President, officer or agent) Chairman or Vice-Chairman) H. C. O'Donnell ------------------------------ ___________________________________________ (Type or Print name) (Type or Print name) (Type or Print Title) GOLD SEAL APPEARS ONLY ON ORIGINAL EX-3.36 34 y98028exv3w36.txt BYLAWS EXHIBIT 3.36 BYLAWS of PLASTICS U.S.A. CORPORATION ARTICLE I MEETING OF SHAREHOLDERS 1. Shareholders' meetings shall be held at the principal place of business of the corporation or at such other place as may be determined by the Board of Directors. 2. The annual meeting of the shareholders shall be held at 2:00 P.M. on the second Monday in March of each year, beginning with the year 1985. 3. At the annual meeting of the shareholders a Board of Directors of one or more members as the shareholders may determine, shall be selected on one ballot, with each shareholder entitled to vote as many shares as each shareholder owns times the total number of directors to be elected, divided in any manner such shareholder wishes among the various candidates. 4. Notice of the time and place of the annual meeting shall be sent to each shareholder of record by first class mail at such share holder's address as recorded on the stock books of the corporation at least 10 days prior to the scheduled meeting. 5. A quorum of shareholders at any meeting shall consist of the owners of a majority of the shares outstanding. If a quorum is present, the shareholders may adjourn from day to day as they see fit, and no notice of such adjournment need to given. If a quorum is not present, the shareholders present in person or by proxy may adjourn to such future time as shall be agreed upon by them and notice of such adjournment shall be mailed to each shareholder at least 10 days before such adjourned meeting. 6. Special meetings of the shareholders may be called at any time by the President, any two directors, or the holders of one-tenth of the outstanding shares of capital stock. The Secretary shall mail a notice of such call to each shareholder of the Corporation at least 10 days before such meeting, and such notice shall state the time, place and purpose of the meeting. No business shall be transacted at a special meeting except as stated in the notice sent to the shareholders, unless by the unanimous consent of all shareholders, either in person or by proxy. 7. Each shareholder, whether represented in person or by proxy, shall be entitled to one vote for each share of stock standing in such shareholder's name on the books of the company. 8. All proxies shall be in writing and signed by the shareholder. 9. Any action required or permitted to be taken at an annual or special meeting of shareholders may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, is signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to shareholders who have not consented in writing. ARTICLE II STOCK 1. Certificates of stock shall be in a form adopted by the shareholders and shall be signed by the President or Vice-President and the Secretary or Treasurer. 2. All certificates shall be numbered consecutively. The name of the person owning the shares represented thereby, with the number of such shares and the date of issue, shall be entered upon the corporation's books. 3. All certificates of stock transferred by endorsement thereon shall be surrendered for cancellation and new certificates issued to the purchaser or assignee. 4. Shares of stock shall be transferred only on the books of the corporation by the holder thereof. ARTICLE III DIRECTORS 1. The Directors shall have the general management and control of the business and affairs of the corporation and shall exercise all the powers that may be exercised or performed by the corporation under the statutes of the State of Michigan, the articles of incorporation or the corporate bylaws. 2. The Board of Directors shall consist of one or more members, as the shareholders may determine, who need not be shareholders. 3. A vacancy on the Board of Directors by reason of death, resignation or other causes may be filled by vote of the remaining directors, or the board may leave the position unfilled, in which case it may be filled by the shareholders at the next annual meeting. During periods when there are unfilled vacancies on the Board of Directors, actions taken by a majority of a quorum of the reduced number shall constitute actions of the Board. 4. The Board of Directors shall meet at least annually, at times and places to be fixed by the Board. Special meetings may be called by the President or by any two Directors, giving one day's notice to each Director. 5. Any action to be taken at a meeting of the Board of Directors or any committee thereof, may be taken without a meeting, without prior notice, and without a vote, if all the members of the Board of Directors, or of the committee, consent thereto in writing. The written consents shall be filed with the minutes of the Board or committee. 6. A member of the Board of Directors may participate in a meeting by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting pursuant to this provision shall constitute presence in person at the meeting. 7. Directors shall act on all matters by a majority of a quorum; a quorum shall consist of a majority of the filled directorships. ARTICLE IV OFFICERS 1. The officers of the corporation shall consist of a President, a Secretary and a Treasurer, and such other officers as shall from time to time be appointed by the Board of Directors. 2. The President shall preside at all meetings of the directors and shareholders and shall have general charge of and control over the affairs of the corporation subject to the Board of Directors. 5. The Executive Committee shall meet informally as needed in the operation of the corporation and shall normally operate on a consensus basis, with no formal motions, resolutions or votes. 6. Members of the Executive Committee shall serve at the pleasure of the Board of Directors. ARTICLE VI FISCAL YEAR 1. The fiscal year of the corporation shall begin on the first day of January and end on the last day of December. ARTICLE VII AMENDMENTS 1. Any of these bylaws may be amended or repealed by a majority vote of the Board of Directors at any annual meeting or at any special meeting called for that purpose. Adopted: JUNE 25, 1984 /s/ Lloyd Higginbolt --------------------------------------------- Secretary EX-3.37 35 y98028exv3w37.txt ARTICLES OF INCORPORATION EXHIBIT 3.37 MICHIGAN DEPARTMENT OF CONSUMER AND INDUSTRY SERVICES CORPORATION, SECURITIES AND LAND DEVELOPMENT BUREAU Date Received (FOR BUREAU USE ONLY) THIS DOCUMENT IS EFFECTIVE ON THE DATE FILED, UNLESS A SUBSEQUENT EFFECTIVE DATE WITHIN 90 DAYS AFTER RECEIVED DATE IS STATED IN THE DOCUMENT Name A. STUART TOMPKINS Address P. O. BOX 222 City State Zip Code SOUTHFIELD MI 48037-0222 EFFECTIVE DATE: DOCUMENT WILL BE RETURNED TO THE NAME AND ADDRESS YOU ENTER ABOVE. IF LEFT BLANK DOCUMENT WILL BE MAILED TO THE REGISTERED OFFICE. ARTICLES OF INCORPORATION FOR USE BY DOMESTIC PROFIT CORPORATIONS (Please read information and instructions on the last page) Pursuant to the provisions of Act 284, Public Acts of 1972, the undersigned corporation executes the following Articles: ARTICLE I The name of the corporation is: MILACRON INDUSTRIAL PRODUCTS, INC. ARTICLE II The purpose or purposes for which the corporation is formed is to engage in any activity within the purposes for which corporations may be formed under the Business Corporation Act of Michigan. ARTICLE III The total authorized shares: 1. Common Shares 50,000 Preferred Shares________________________________________ 2. A statement of all or any of the relative rights, preferances and limitations of the shares of each class is as follows: GOLD SEAL APPEARS ONLY ON ORIGINAL ARTICLE IV 1. The address of the registered office is: 25800 Northwestern Highway, Suite 1000 Southfield 48075 -------------------------------------- -----------, Michigan--------- (Street Address) (City) (Zip Code) 2. The mailing address of the registered office, if different than above: P.O. Box 222 Southfield 48037-0222 --------------------------- ----------, Michigan, ------------------ (Street Address or P.O Box) (City) (Zip Code) 3. The name of the resident agent at the registered office is A. Stuart Tompkins ARTICLE V The name(s) and address(es) of the incorporator(s) is (are) as follow: Name Residence or Business Address A. Stuart Tompkins 25800 Northwestern Highway, Suite 1000 -------------------------------------------------------------------------- Southfield, Michigan 48075 -------------------------------------------------------------------------- -------------------------------------------------------------------------- -------------------------------------------------------------------------- -------------------------------------------------------------------------- ARTICLE VI (Optional. Delete if not applicable) ARTICLE VII (Optional. Delete if not applicable) Any action required or permitted by the Act to be taken at an annual or special meeting of shareholders may be taken without a meeting, without prior notice, and without a vote, if consents in writing, setting forth the action so taken, are signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote on the action were present and voted. The written consent shall bear the date of signature of each shareholder who signs the consent. No written consents shall be effective to take the corporate action referred to unless, within 60 days after the record date for determining shareholders entitled to express consent to or to dissent from a proposal without a meeting, written consents dated not more than 10 days before the record date and signed by a sufficient number of shareholders to take the action are delivered to the corporation. Delivery shall be to the corporation's registered office, its principal place of business, or an officer or agent of the corporation having custody of the minutes of the proceedings of its shareholders. Delivery made to a corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to shareholders who would have been entitled to notice of the shareholder meeting if the action had been taken at a meeting and who have not consented in writing. GOLD SEAL APPEARS ONLY ON ORIGINAL Use space below for additional Articles or for continuation of previous Articles. Please identify any Article being continued or added. Attach additional pages if needed. I (We), the incorporator(s) sign my (our) names(s) this 14(th) day of January, 1999 /s/ A. Stuart Tompkins - --------------------------------- -------------------------------- A. Stuart Tompkins - --------------------------------- -------------------------------- - --------------------------------- -------------------------------- - --------------------------------- -------------------------------- - --------------------------------- -------------------------------- GOLD SEAL APPEARS ONLY ON ORIGINAL Name of person or organization Preparer's name and business remitting fees: telephone number: Sullivan, Ward, Bone, Tyler A. Stuart Tompkins & Asher, P.C. (248) 746-0700 INFORMATION AND INSTRUCTIONS 1. The Articles of Incorporation cannot be filed until this form, or a comparable document, is submitted. 2. Submit one original of this document. Upon filing, the document will be added to the records of the Corporation, Securities and Land Development Bureau. The original will be returned to your registered office address, unless you enter a different address in the box on the front of this document. Since the document will be maintained on optical disk media, it is important that the filing be legible. Documents with poor black and white contrast, or otherwise illegible, will be rejected. 3. This document is to be used pursuant to the provisions of Act 284 P.A. of 1972, by one or more persons for the purpose of forming a domestic profit corporation. 4. Article I- The corporate name of a domestic profit corporation is required to contain one of the following words or abbreviations: "Corporation", "Company", "Incorporated" , "Limited", "Corp.", "Co", "Inc", or "Ltd". 5. Article II- State, in general terms, the character of the particular business to be carried on. Under section 202(b)of the Act, it is sufficient to state substantially, alone or with specifically enumerated purposes, that the corporation may engage in any activity within the purpose for which corporations may be formed under the Act. The Act requires, however, that educational corporations state their specific purposes. 6. Article III- Indicate the total number of shares which the corporation has authority to issue. If there is more than one class or series of shares, state the relative rights, preferences and limitation of shares of each class in Article III(2). 7. Article IV- A post office box may not be designated as the address of the registered office. 8. Article V- The act requires one or more incorporations. Educational corporations are required to have at least three (3) incorporations. The address(es) should include a street number and name (or other designation), city and state. 9. The duration of the corporation should be stated in the Articles only if not perpetual. 10. This document is effective on the date endorsed "filed" by the Bureau. A later effective date, no more than 90 days after the date of delivery, may be stated as an additional article. 11. The Articles must be signed by each incorporator. The names of the incorporators as set out in Article V should correspond with the signatures. 12. FEES: Make remittance payable to the State of Michigan. Include corporation name on check or money order.
NON REFUNDABLE FEE...................................................................................... $ 10.00 ORGANIZATION FEE: first 60,000 authorized shares or portion thereof..................................... $ 50.00 TOTAL MINIMUM FEE....................................................................................... $ 60.00 ADDITIONAL ORGANIZATION FEE FOR AUTHORIZED SHARES OVER 60,000: each additional 20,000 authorized shares or portion thereof ...................................... $ 30.00 maximum fee per filing for first 10,000,000 authorized shares .................................... $ 5,000.00 each additional 20,000 authorized shares or portion thereof in excess of 10,000,000 shares........ $ 30.00 maximum fee per filing for authorized shares in excess of 10,000,000 shares ...................... $200,000.00
To submit by US Postal Service To submit in person or by courier mail form and fee to : service deliver form and fee to: Michigan Department of Consumer 6546 Mercantile & Industry Services Lansing, MI 48910 Way Corporation, Securities and Telephone: (517)334-6302 Land Development Bureau Corporation Division P.O. Box 30064 Lansing MI 48909-7654 Fees may be paid by VISA or Mastercard when delivered in person to our office. To submit by Mich-Elf tax form to: (517) 334-8048 "To use this service complete a MICH - ELF application to provide your VISA or Mastercard number. Include your assigned Filer number on your transmission. To obtain an application for a filer number, contact(517)334-6327 or visit our WEB site at http://www.cia.state.mi.us/corp/. GOLD SEAL APPEARS ONLY ON ORIGINAL ARTICLE VIII 1. ELIMINATION OF CERTAIN LIABILITY OF DIRECTORS A director of the corporation shall not be personally liable to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director, except tor liability: A. For any breach of the director's duty of loyalty to the corporation or its shareholders; B. For acts or omissions not in good faith or that involve intentional misconduct or knowing violation of law; C. For a violation of Section 551(1) of the Michigan Business Corporation Act; and D. For any transaction from which the director derived an improper personal benefit. If the Michigan Business Corporation Act is hereafter amended to further eliminate or limit the liability of a director, then a director of the corporation (in addition to the circumstances in which a director is not personally liable as set forth in the preceding paragraph) shall not be liable to the corporation or its shareholders to the fullest extent permitted by the Michigan Business Corporation Act, as so amended. Any repeal or modification of this Article by the shareholders of the corporation shall not adversely affect any right or protection of a director of the corporation existing at the time Of such repeal or modification. ARTICLE IX 1. INDEMNIFICATION OF DIRECTORS AND OFFICERS. A. Third Party Proceedings. The corporation shall indemnify any person who was or is a party or is threatened to be made a party to a threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal, other than an action by or in the right of the corporation, by reason of the fact that he or she is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director, officer, partner, or trustee of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses, including attorneys' fees, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with the action, suit, or proceeding, if the person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation or its shareholders, and the person submits a written claim for indemnification as hereinafter provided, and with respect to a criminal action or proceeding, if the person had no reasonable cause to believe his or her conduct was unlawful, and the person submits a written claim for indemnification as hereinafter provided. The termination of an action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, does not, of itself, create a presumption that the person did not act in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation or its shareholders, and, with respect to a criminal action or proceeding, had reasonable cause to believe that his or her conduct was unlawful. The right to indemnification conferred in this Article shall be a contract right. The corporation may, by action of its Board of Directors, or by action of any person to whom the Board of Directors has delegated such authority, provide indemnification to employees end agents of the corporation with the same scope and effect as the foregoing indemnification of directors and officers. B. Derivative Shareholder Liability. The corporation shall indemnify any person who was or is a party to or is threatened to be made a party to a threatened, pending, or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he or she is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director, officer, partner, or trustee of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses, including attorneys' fees, and amounts paid in settlement actually and reasonably incurred by the person in connection with the action or suit, if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation or its shareholders, and the person submits a written claim of indemnification as hereinafter provided. However, indemnification shall not be made for a particular claim, issue, or matter in which the GOLD SEAL APPEARS ONLY ON ORIGINAL person has been found liable to the corporation unless and only to the extent that the court in which the action or suit was brought (or another court of competent jurisdiction) has determined upon application that, despite the adjudication of liability but in view of all the relevant circumstances, the person is fairly and reasonably entitled to indemnification for the reasonable expenses he or she incurred. The right to indemnification conferred in this Article shall be a contract right. The corporation may, by action of its Board of Directors, or by action of any person to whom the Board of Directors has delegated such authority, provide indemnification to employees and agents of the corporation with the same scope and effect as the foregoing indemnification of directors and officers. C. Determination of Indemnification. An indemnification under paragraph A or B of this Article, unless ordered by a court, shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director or officer in proper in the circumstances because he or she has met the applicable standard of conduct set forth in paragraph A or B of this Article and upon an evaluation of the reasonableness of expenses and amounts paid in settlement. This determination and evaluation shall occur within thirty (30) days after a written claim for indemnification has been received by the corporation, and shall be made in any of the following ways: (1) By a majority vote of a quorum of the board consisting of directors who are not parties or threatened to be made parties to the action, suit, or proceeding; (2) If the quorum described in subparagraph C(1) is not obtainable, then by a majority vote of a committee duly designated by the board and consisting solely of two or more directors not at the time parties or threatened to be made parties to the action, suit, or proceeding; (3) By independent legal counsel in a written opinion, which counsel shall be selected in one of the following ways: (a) By the board or its committee in the manner prescribed in subparagraph C(1) or C(2), (b) If a quorum of the board cannot be obtained under subparagraph C(1) and a committee cannot be designated under subparagraph C(2) by the board; (4) By all independent directors who are not parties or threatened to be made parties to the action, suit, or proceeding; and (5) By the shareholders, but shares held by directors, officers, employees, or agents who are parties or threatened to be made parties to the action, suit, or proceeding may not be voted. In the designation of a committee under subparagraph C(2) or in the selection of independent legal counsel under subparagraph C(3)(b), all directors may participate. If a person is entitled to indemnification under paragraph A or B of this Article for a portion of expenses, including reasonable attorneys' fees, judgments, penalties, fines, and amounts paid in settlement, but not for the total amount thereof, the corporation shall indemnify the person for the portion of the expenses, judgments, penalties, fines, or amounts paid in settlement for which the person is entitled to be indemnified. D. Payment of Defense Expenses in Advance. The corporation shall pay or reimburse the reasonable expenses incurred by a director or officer who is a party or threatened to be made a party to an action, suit or proceeding in advance of final disposition of the proceeding if all of the following apply: (1) The person furnishes the corporation a written affirmation of his or her good faith belief that he or she has met the applicable standard of conduct set forth in paragraph A end B of this Article. (2) The person furnishes the corporation a written undertaking, executed personally or on his or her behalf, to repay the advance if it is ultimately determined that he or she did not meet the standard of conduct. (3) A determination is made that the facts then known to those making the determination would not preclude indemnification under this Article or the Michigan Business Corporation Act. GOLD SEAL APPEARS ONLY ON ORIGINAL The undertaking shall be by unlimited general obligation of the person on whose behalf advances are made but need not be secured. Determination of payments under this paragraph D shall be made in the manner described in paragraph C(1)-(5). In the designation of a committee under paragraph C(2) or in the selection of independent legal counsel under paragraph C(3)(b), all directors may participate. E. Right of Officer or Director to Bring Suit. If a claim for indemnification under this Article is not paid in full by the corporation within forty-five (45) days after a written claim has been received by the corporation, the officer or director who submitted the claim (hereinafter the "indemnitee") may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit or in a suit brought by the corporation to recover advances, the indemnitee shall be entitled to be paid also the expense of prosecuting or defending such claim. In any action brought by the indemnitee to enforce a right under this Article (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any, has been tendered to the corporation) it shall be a defense that, and in any action brought by the corporation to recover advances the corporation shall be entitled to recover such advances if, the indemnitee has not met the applicable standard of conduct set forth in paragraph A or B of this Article. Neither the failure of the corporation (including its Board of Directors, independent legal counsel, or its shareholders) to have made a determination prior to the commencement of such action that indemnification of the indemnitee is proper in the circumstances because he or she has met the applicable standard of conduct set forth in paragraph A or B of this Article, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel, or its shareholders) that the indemnitee has not met such applicable standard of conduct, shall be a defense to an action brought by the indemnitee or create a presumption that the indemnitee has not met the applicable standard of conduct. In any action brought by the indemnitee to enforce a right hereunder or by the corporation to recover payments by the corporation of advances, the burden of proof shall be on the corporation. F. Other Indemnification. The indemnification or advancement of expenses provided under paragraphs A through E of this Article is not exclusive of other rights to which a person seeking indemnification or advancement of expenses may be entitled under the corporation's Bylaws, or a contractual agreement. However, the total amount of expenses advanced or indemnified from all sources combined shall not exceed the amount of actual expenses incurred by the person seeking indemnification or advancement of expenses. The indemnification provided for in paragraphs A through F of this Article continues as to a person who ceases to be a director, officer, partner, or trustee and shall inure to the benefit of the heirs, executors, and administrators of the person. G. Liability Insurance. The corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him or her and incurred by him or her in any such capacity or arising out of his or her status as such, whether or not the corporation would have power to indemnify him or her against liability under the Michigan Business Corporation Act or this Article. H. Definitions. For purposes of this Article, "corporation" includes all constituent corporations absorbed in a consolidation or merger and the resulting or surviving corporation, so that a person who is or was a director, officer, employee, or agent of the constituent corporation or is or was serving at the request of the constituent corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise whether for profit or not shall stand in the same position under the provisions of this paragraph with respect to the resulting or surviving corporation as the person would if he or she had served the resulting or surviving the corporation in the same capacity. For purposes of this Article, "other enterprises" shall include employee benefit plans; "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and "serving at the request of the corporation" shall include any service as a director or officer of the corporation which imposes duties on, or involves services by, the director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be considered to have acted in a manner "not opposed to the best interests of the corporation or its shareholders" as referred to in paragraphs A and B of this Article. GOLD SEAL APPEARS ONLY ON ORIGINAL MICHIGAN DEPARTMENT OF CONSUMER AND INDUSTRY SERVICES CORPORATION, SECURITIES AND LAND DEVELOPMENT BUREAU Date Received (FOR BUREAU USE ONLY) FILED JUL 23 1999 Administrator CORP. SECURITIES & LAND DEV. BUREAU Name C T CORPORATION SYSTEM - Karen Address 441 Vine St., Ste. 3810 City State Zip Code Cincinnati, Ohio 45202 EFFECTIVE DATE :________________ DOCUMENT WILL BE RETURNED TO THE NAME AND ADDRESS YOU ENTER ABOVE CERTIFICATE OF CHANGE OF REGISTERED OFFICE AND/OR CHANGE OF RESIDENT AGENT FOR USE BY DOMESTIC AND CORPORATIONS AND LIMITED LIABILITY COMPANIES (Please read information and instruction on reverse side ) Pursuant to the provisions of Act 284, Public Acts of 1972 (profit corporations), or Act 162, Public Acts 1982 (nonProfit corporations), or Act 23, Public Acts of 1993 (limited liability companies), the undersigned corporation or limited liability company executes the following Certificate: 1. The name of the corporation or limited liability company is: MILACRON INDUSTRIAL PRODUCTS, INC. 2. The identification number assigned by the Bureau is: 00777A 3.a. The name of the resident agent on file with the Bureau is: A. Stuart Tompkins b. The location of the registered office on file with the Bureau is: 25800 Northwestern Hwy Ste. 1000 Southfield, Michigan 48075 --------------------------------- ----------- ---------------- (Street Address) (City) (Zip Code) c. The mailing address of the above registered office on file with the Bureau is: 25800 Northwestern Hwy Ste. 1000 Southfield, Michigan 48075 --------------------------------- ---------- ----------------- (Street Address) (City) (Zip Code) ENTER IN ITEM 4 THE INFORMATION AS IT SHOULD NOW APPEAR ON THE PUBLIC RECORD 4.a. The name of the resident agent is: The Corporation Company b. The address of the registered office is: 30600 Telegraph Road Bingham Farms, Michigan 48025 --------------------------------- -------------- ---------------- (Street Address) (City) (Zip Code) c. The mailing address of the registered office IF DIFFERENT THEN 4B is: , Michigan --------------------------------------- -------------------- (Street Address or P.O. Box ) (City) (Zip Code) 5. The above changes were authorized by resolution duly by: 1. ALL CORPORATIONS: its board of directors; 2. PROFIT CORPORATIONS ONLY: the resident agent it only the address of the registered office is changed, in which once a copy of this statement has been mailed to the corporation; 3. LIMITED LIABILITY COMPANIES: an operating agreement, affirmative vote of a majority of the members pursuant to section 502(1), managers pursuant to section 405, or the resident agent if only the address of the registered office is changed. The corporation or limited liability company further states that the address of the registered office and the address of its resident agent, as changed, are identical. Signature Type or Print Name and Title: Date Signed /s/ Hugh C. O'Donnell Hugh C. O'Donnell, Secretary 7/9/99 (MI 54-2/27/97) GOLD SEAL APPEARS ONLY ON ORIGINAL EX-3.38 36 y98028exv3w38.txt BYLAWS EXHIBIT 3.38 BYLAWS OF MILACRON INDUSTRIAL PRODUCTS, INC. ARTICLE I STOCKHOLDERS SECTION 1. ANNUAL MEETINGS AND SPECIAL MEETINGS. The annual meeting of the stockholders of the corporation shall be held on a day duly designated by the Board of Directors in April of each year, if not a legal holiday, and if a legal holiday then the next succeeding day not a legal holiday, for the purpose of electing directors to succeed those whose terms shall have expired as of the date of such annual meeting, and for the transaction of such other corporate business as may come before the meeting. Special meetings of the stockholders may be called at any time for any purpose or purposes by the Chairman of the Board, the President, by a Vice-President, or by a majority of the Board of Directors, and shall be called forthwith by the Chairman of the Board, the President, by a Vice-President, the Secretary, or any director of the Corporation upon the request in writing of the holders of a majority of all the shares outstanding and entitled to vote on the business to be transacted at such meeting. Such request shall state the purpose or purposes of the meeting. Business transacted at all special meetings of stockholders shall be confined to the purpose or purposes stated in the notice of the meeting. SECTION 2. PLACE OF HOLDING MEETINGS. All meetings of stockholders shall be held at the principal office of the Corporation or elsewhere in the United States as designated by the Board of Directors. SECTION 3. NOTICE OF MEETINGS. Written notice of each meeting of the stockholders shall be mailed, postage prepaid by the Secretary, to each stockholder of record entitled to vote threat at his post office address, as it appears upon the books of the Corporation, at least ten (10) days before the meeting. Each such notice shall state the place, day, and hour at which the meeting is to be held and, in the case of any special meeting, shall state briefly the purpose or purposes thereof. SECTION 4. QUORUM. The presence in person or by proxy of the holders of record of a majority of the shares of the capital stock of the corporation issued and outstanding and entitled to vote thereat shall constitute a quorum at all meetings of the stockholders, except as otherwise provided by law, by the Articles of Incorporation or by these Bylaws. If less than a quorum shall be in attendance at the time for which the meeting shall have been called, the meeting may be adjourned from time to time by a majority vote of the stockholders present or represented, without any notice other than by announcement at the meeting, until a quorum shall attend. At any adjourned meeting at which a quorum shall attend, any business may be transacted which might have been transacted if the meeting had been held as originally called. SECTION 5. CONDUCT OF MEETINGS. Meetings of stockholders shall be presided over by the President of the Corporation or, if he is not present, by a Vice-President, or, if none of said officers is present, by a chairman to be elected at the meeting. The Secretary of the Corporation, or if he is not present, any Assistant Secretary shall act as secretary of such meetings; in the absence of the Secretary and any Assistant Secretary, the presiding officer may appoint a person to act as Secretary of the meeting. SECTION 6. VOTING. At all meetings of stockholders, every stockholder entitled to vote thereat shall have one (1) vote for each share of stock standing in his name on the books of the Corporation on the date for the determination of stockholders entitled to vote at such meeting. Such vote may be either in person or by proxy appointed by an instrument in writing subscribed by such stockholder or his duly authorized attorney, bearing a date not more than three (3) months prior to said meeting, unless said instrument provides for a longer period. Such proxy shall be dated, but need not be sealed, witnessed or acknowledged. All elections shall be had and all questions shall be decided by a majority of the votes cast at a duly constituted meeting, except as otherwise provided by law, in the Articles of Incorporation or by these Bylaws. If the chairman of the meeting shall so determine, a vote by ballot may be taken upon any election or matter, and the vote shall be so taken upon the request of the holders of ten percent (10%) of the stock entitled to vote on such election or matter. In either of such events, the proxies and ballots shall be received and be taken in charge and all questions touching the qualification of voters and the validity of proxies and the acceptance or rejection of votes, shall be decided by the teller. Such tellers shall be appointed by the chairman of said meeting. ARTICLE II BOARD OF DIRECTORS SECTION 1. GENERAL POWERS. The property and business of the Corporation shall be managed under the direction of the Board of Directors of the Corporation. SECTION 2. NUMBER AND TERM OF OFFICE. The number of directors shall be one (1) or such other number, as may be designated from time to time by resolution of a majority of the entire Board of Directors. Directors need not be stockholders. The directors shall be elected each year at the annual meeting of stockholders. The directors shall be elected each 2 year at the annual meeting of stockholders, except as hereinafter provided, and each director shall serve until his successor shall be elected and shall qualify. SECTION 3. FILLING OF VACANCIES. In the case of any vacancy in the Board of Directors through death, resignation, disqualification, removal, or other cause, the remaining directors, by affirmative vote of the majority thereof, may elect a successor or hold office for the unexpired portion of the term of the director whose place shall be vacant, and until the election of his successor, or until he shall be removed, prior thereto, by an affirmative vote of the holders of a majority of the stock. Similarly, and in the event of the number of directors being increased as provided in these Bylaws, the additional directors so provided for shall be elected by a majority of the entire Board of Directors already in office, and shall hold office until the next annual meeting of stockholders and thereafter until his or their successors shall be elected. Any director may be removed from office with or without cause by the affirmative vote of the holders of the majority of the stock issued and outstanding and entitled to vote at any special meeting of stockholders regularly called for the purpose. SECTION 4. PLACE OF MEETING. The Board of Directors may hold their meetings and have one or more offices, and keep the books of the Corporation, either within or outside the State of Michigan, at such place or places as they may from time to time determine by resolution or by written consent of all the directors. The Board of Directors may hold their meetings by conference telephone or other similar electronic communications equipment in accordance with the provisions of the Michigan Business Corporation Act. SECTION 5. REGULAR MEETINGS. Regular meetings of the Board of Directors may be held without notice at such time and place as shall from time to time be determined by resolution of the board, provided that notice of every resolution of the Board fixing or changing the time or place for the holding of regular meetings of the Board shall be mailed to each director at least three (3) days before the first meeting held pursuant thereto. The annual meeting of the Board of Directors shall be held immediately following the annual stockholders' meeting at which a Board of Directors is elected. Any business may be transacted at any regular meeting of the Board. SECTION 6. SPECIAL MEETINGS. Special meetings of the Board of Directors shall be held whenever called by direction of the Chairman of the Board or the President and must be called by the Chairman of the Board, the President or the Secretary upon written request of a majority of the Board of Directors. The Secretary shall give notice of each special meeting of the Board of Directors, by mailing the same at least three (3) days prior to the meeting or by telegraphing the same at least two (2) days before the meeting, to each director; but such notice may be waived by any director. Unless otherwise indicated in the notice thereof, any 3 and all business may be transacted at any special meetings. At any meeting at which every director shall be present, even though without notice, any business may be transacted and any director may in writing waive notice of the time, place and objectives of any special meeting. SECTION 7. QUORUM. A majority of the whole number of directors shall constitute a quorum for the transaction of business at all meetings of the Board of Directors, but, if at any meeting less than a quorum shall be present, a majority of those present may adjourn the meeting from time to time, and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by law or by the Articles of Incorporation or by these Bylaws. SECTION 8. COMPENSATION OF DIRECTORS. Directors shall not receive any stated salary for their services. Nothing herein contained shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. SECTION 9. COMMITTEES. The Board of Directors may, by resolution passed by a majority of the whole Board, designated one or more committees, each committee to consist of two or more of the directors of the Corporation, which, to the extent provided in the resolution, shall have and may exercise the powers of the Board of Directors, and may authorize the seal of the Corporation to be affixed to all papers which may require it. Such committee or committees shall have such names as may be determined from time to time by resolution adopted by the Board of Directors. ARTICLE III OFFICERS SECTION 1. ELECTION, TENURE, AND COMPENSATION. The officers of the Corporation shall be a President, a Secretary, and a Treasurer, and also such other officers including a Chairman of the Board and/or one or more Vice-Presidents and/or one or more assistants to the foregoing officers as the Board of Directors from time to time may consider necessary for the proper conduct of the business of the Corporation. The officers shall be elected annually by the Board of Directors at its first meeting following the annual meeting of the stockholders. The President and Chairman of the Board shall be a director and the other officers may, but need not be, directors. Any two or more of the above offices, except those of President and Vice-President, may be held by the same person, but no officer shall execute, acknowledge or verify any instrument in more than one capacity if such instrument is required by law or by these Bylaws to be executed, acknowledged, or verified by any two or more officers. The compensation or salary paid all officers of the Corporation shall be fixed by resolutions adopted by the Board of Directors. 4 In the event that any office other than an office required by law, shall not be filled by the Board of Directors or, once filled, subsequently becomes vacant, then such office and all references thereto in these Bylaws shall be deemed inoperative unless and until such office is filled in accordance with the provisions of these Bylaws. Except where otherwise expressly provided in a contract duly authorized by the Board of Directors, all officers and agents of the Corporation shall be subject to removal at any time by the affirmative vote of a majority of the whole Board of Directors, and all officers, agents, and employees, shall hold office at the discretion of the Board of Directors or of the officers appointing them. SECTION 2. POWERS AND DUTIES OF THE CHAIRMAN OF THE BOARD. The Chairman of the Board shall preside at all meetings of the Board of Directors unless the Board of Directors shall by a majority vote of a quorum thereof elect a chairman other than the Chairman of the Board to preside at meetings of the Board of Directors. He may sign and execute all authorized bonds, contracts, or other obligations in the name of the Corporation; and he shall be ex-officio a member of all standing committees. SECTION 3. POWERS AND DUTIES OF THE PRESIDENT. The President shall have general charge and control of all its business affairs and properties. He shall preside at all meetings of the stockholders. The President may sign and execute all authorized bonds, contracts, or other obligations in the name of the Corporation. He shall have the general powers and duties of supervision and management usually vested in the office of president of a corporation. He shall do and perform such other duties as may, from time to time, be assigned to him by the Board of Directors. In the event that the Board of Directors does not take affirmative action to fill the office of Chairman of the Board, the President shall assume and perform all powers and duties given to the Chairman of the Board by these Bylaws. SECTION 4. POWERS AND DUTIES OF THE VICE-PRESIDENT. The Board of Directors may appoint a Vice-President and may appoint more than one Vice-President. Any Vice-President (unless otherwise provided by resolution of the Board of Directors) may sign and execute all authorized bonds, contracts, or other obligations in the name of the Corporation. Each Vice-President shall have such other powers and shall perform such other duties as may be assigned to him by the Board of Directors or by the President. In case of the absence or disability of the President, the duties of that office shall be performed by any Vice-President, and the taking of any action by any such Vice-President in place of the President shall be conclusive evidence of the absence or disability of the President. 5 SECTION 5. SECRETARY. The Secretary shall give, or cause to be given, notice of all meetings of stockholders and directors and all other notices required by law or by these Bylaws, and in case of his absence or refusal or neglect to do so, any such notice may be given by any person thereunto directed by the President, or by the directors or stockholders upon whose written request the meeting is called as provided in these Bylaws. The Secretary shall record all the proceedings of the meetings of the stockholders and of the directors in books provided for that purpose, and he shall perform such other duties as may be assigned to him by the directors or the President. He shall have custody of the seal of the Corporation and shall affix the same to all instruments requiring it, when authorized by the Board of Directors or the President, and attest the same. In general, the Secretary shall perform all the duties generally incident to the office of Secretary, subject to the control of the Board of Directors and the President. SECTION 6. TREASURER. The Treasurer shall have custody of all the funds and securities of the Corporation, and he shall keep full and accurate account of receipts and disbursements in books belonging to the Corporation. He shall deposit all moneys and other valuables in the name and to the credit of the Corporation in such depository or depositories as may be designated by the Board of Directors. The Treasurer shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements. He shall render to the President and the Board of Directors, whenever either of them so requests, an account of all his transactions as Treasurer and of the financial condition of the Corporation. The Treasurer shall perform all the duties generally incident to the office of the Treasurer, subject to the control of the Board of Directors and the President. SECTION 7. ASSISTANT SECRETARY. The Board of Directors may appoint an Assistant Secretary or more than one Assistant Secretary. Each Assistant Secretary shall (except as otherwise provided by resolution of the Board of Directors) have power to perform all duties of the Secretary in the absence or disability of the Secretary and shall have such other powers and shall perform such other duties as may be assigned to him by the Board of Directors or the President. In case of the absence or disability of the Secretary, the duties of the office shall be performed by any Assistant Secretary, and the taking of any action by any such Assistant Secretary in place of the Secretary shall be conclusive evidence of the absence or disability of the Secretary. SECTION 8. ASSISTANT TREASURER. The Board of Directors may appoint an Assistant Treasurer or more than on Assistant Treasurer. Each Assistant Treasurer shall (except as otherwise provided by resolution of the Board of Directors) have power to perform all duties of the Treasurer in the absence or disability of the Treasurer and shall have such other powers and shall perform such other duties as may be assigned to him by the Board of Directors or 6 the President. In case of the absence or disability of the Treasurer, the duties of the office shall be performed by any Assistant Treasurer, and the taking of any action by any such Assistant Treasurer in place of the Treasurer shall be conclusive evidence of the absence or disability of the Treasurer. ARTICLE IV CAPITAL STOCK SECTION 1. ISSUANCE OF CERTIFICATES OF STOCK. The certificates for shares of the stock of the Corporation shall be of such form not inconsistent with the Articles of Incorporation, or its amendments, as shall be approved by the board of Directors. All certificates shall be signed by the President or by the Vice-President and counter-signed by the Secretary or by an Assistant Secretary. All certificates for each class of stock shall be consecutively numbered. The name of the person owning the shares issued and the address of the holder, shall be entered in the Corporation's books. All certificates surrendered to the Corporation for transfer shall be canceled and no new certificates representing the same number of shares shall be issued until the former certificate or certificates for the same number of shares shall have been so surrendered, and canceled, unless a certificate of stock be lost or destroyed, in which event another may be issued in its stead upon proof of such loss or destruction and unless waived by the President, the giving of a satisfactory bond of indemnity not exceeding an amount double the value of the stock. Both such proof and such bond shall be in a form approved by the general counsel of the Corporation and by the Transfer Agent of the Corporation and by the Registrar of the stock. SECTION 2. TRANSFER OF SHARES. Shares of the capital stock of the Corporation shall be transferred on the books of the Corporation only by the holder thereof in person or by his attorney upon surrender and cancellation of certificates for a like number of shares as hereinbefore provided. SECTION 3. REGISTERED STOCKHOLDERS. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim to or interest in such share or shares in the name of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by the Laws of Michigan. SECTION 4. CLOSING TRANSFER BOOKS. The Board of Directors may fix the time, not exceeding ten (10) days preceding the date of any meeting of stockholders or any dividend payment date or any date for the allotment of rights, during which time the books of the Corporation shall be closed against transfers of stock, or, in lieu thereof, the directors may fix a date not exceeding ten (10) days preceding the date of any meeting of stockholders or any dividend payment date or any date for the allotment of rights, as a record date for the 7 determination of the stockholders entitled to notice of and to vote at such meeting or to receive such dividends or rights as the case may be; and only stockholders of record on such date shall be entitled to notice of and to vote at such meeting or to receive such dividends or rights as the case may be. ARTICLE V CORPORATION SEAL SECTION 1. SEAL. In the event that the President shall direct the Secretary to obtain a corporate seal, the corporate seal shall be circular in form and shall have inscribed thereon the name of the Corporation, the year of its organization and the word "Michigan." Duplicate copies of the corporate seal may be provided for use in the different offices of the Corporation but each copy thereof shall be in the custody of the Secretary of the Corporation or of an Assistant Secretary of the Corporation nominated by the Secretary. ARTICLE VI BANK ACCOUNTS AND LOANS SECTION 1. BANK ACCOUNTS. Such officers or agents of the Corporation as from time to time shall be designated by the Board of Directors shall have authority to deposit any funds of the Corporation in such banks or trust companies as shall from time to time be designated by the Board of Directors and such officers or agents as from time to time shall be authorized by the Board of Directors may withdraw any or all of the funds of the Corporation so deposited in any bank or trust company, upon checks, drafts or other instruments or orders for the payment of money, drawn against the account or in the name or behalf of this Corporation, and made or signed by such officers or agents; and each bank or trust company with which funds of the Corporation are so deposited is authorized to accept, honor, cash and pay, without limit as to amount, all checks, drafts or other instruments or orders for the payment of money, when drawn, made or signed by officers or agents so designated by the Board of Directors until written notice of the revocation of the authority of such officers or agents by the Board of Directors shall have been received by such bank or trust company. There shall from time to time be certified to the banks or trust companies in which funds of the Corporation are deposited, the signature of the officers or agents of the Corporation so authorized to draw against the same. In the event that the Board of Directors shall fail to designate the persons by whom checks, drafts, and other instruments or orders for the payment of money shall be signed, as hereinabove provided in this Section, all of such checks, drafts, and other instruments or orders for the payment of money shall be signed by the President or a Vice-President and countersigned by the Secretary or Treasurer or any Assistant Secretary or an Assistant Treasurer of the Corporation. 8 SECTION 2. LOANS. Such officers or agents of this Corporation as from time to time shall be designated by the Board of Directors shall have authority to effect loans, advances, or other forms of credit at any time or times for the Corporation from such banks, trust companies, institutions, corporations, firms, or persons as the Board of Directors shall from time to time designate, and as security for the repayment of such loans, advances, or other forms of credit to assign, transfer, endorse, and deliver, either originally or in addition or substitution, any or all stocks, bonds, rights and interests of any kind in or to stocks or bonds, certificates of such rights or interests, deposits, accounts, documents covering merchandise, bills and accounts receivable and other commercial paper and evidences of debt at any time held by the Corporation; and for such loans, advances, or other forms of credit to make, execute, and deliver one or more notes, acceptances, or written obligations of the Corporation on such terms, and with such provisions as to the security or sale or disposition thereof as such officers or agents shall deemed proper; and also to sell to, or discount or rediscount with, such banks, trust companies, institutions, corporations, firms, or persons any and all commercial paper, bills receivable, acceptances, and other instruments and evidences of debt at any time held by the Corporation, and to that end to endorse, transfer, and deliver the same. There shall from time to time be certified to each bank, trust company, institution, corporation, firm, or person so designated the signatures of the officers or agents so authorized; and each such bank, trust company, institution, corporation, firm, or person is authorized to rely upon such certification until written notice of the revocation by the Board of Directors of the authority of such officers or agents shall be delivered to such bank, trust company, institution, corporation, firm, or person. ARTICLE VII REIMBURSEMENTS SECTION 1. REIMBURSEMENTS. Any payments made to an officer or other employee of the Corporation, such as salary, commission, interest or rent, or entertainment expense incurred by him, which shall be disallowed in whole or in part as a deductible expense by the Internal Revenue Service, shall be reimbursed by such officer or other employee of the Corporation to the full extent of such disallowance. It shall be the duty of the Directors, as a Board, to enforce payment of each such amount disallowed. In lieu of payment by the officer or other employee, subject to the determination of the Directors, proportionate amounts may be withheld from his future compensation payments until the amount owed to the Corporation has been recovered. 9 ARTICLE VIII MISCELLANEOUS PROVISIONS SECTION 1. FISCAL YEAR. The Corporation shall utilize a calendar year. SECTION 2. NOTICES. Whenever, under the provisions of these Bylaws, notice is required to be given to any director, officer, or stockholder, it shall not be construed to mean personal notice, but such notice shall be given in writing, by mail, by depositing the same in a post office or letter box, in a postpaid sealed wrapper, addressed to each stockholder, officer, or director at such address as appears on the books of the Corporation, or in default of any other address, to such director, officer, or stockholder, at the general post office in the City of Livonia, Michigan and such notice shall be deemed to be given at the time the same shall be thus mailed. Any stockholder, director, or officer may waive any notice required to be given under these Bylaws. ARTICLE IX AMENDMENTS SECTION 1. AMENDMENT OF BYLAWS. The Board of Directors shall have the power and authority to amend, alter or repeal these Bylaws or any provision thereof, and may from time to time make additional Bylaws. ARTICLE X INDEMNIFICATION SECTION 1. NONDERIVATIVE ACTIONS. Subject to all of the other provisions of Article X, the corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative, formal or informal (other than an action by or in the right of the corporation), by reason of the fact that the person is or was a director or officer of the Corporation, or, while serving as a director or officer of the Corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses (including actual and reasonable attorney fees), judgments, penalties, fines, and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit, or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Corporation or its shareholders, and with respect to any criminal action or proceeding, if the person had no reasonable cause to believe his conduct was 10 unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or on a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner that the person reasonably believed to be in or not opposed to the best interests of the Corporation or its shareholders, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. SECTION 2. DERIVATIVE ACTIONS. Subject to all of the provisions of Article X, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that the person is or was a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses (including actual and reasonable attorney fees), and amounts paid in settlement actually and reasonably incurred by the person in connection with the action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Corporation or its shareholders. However, indemnification shall not be made for any claim, issue, or matter in which the person has been found liable to the Corporation unless and only to the extent that the court in which the action or suit was brought has determined on application that, despite the adjudication of liability but in view of all circumstances of the case, the person is fairly and reasonably entitled to indemnification for the reasonable expenses incurred. SECTION 3. EXPENSES OF SUCCESSFUL DEFENSE. To the extent that a person has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in sections 10.01 or 10.02 of these bylaws, or in defense of any claim, issue, or matter in the action, suit, or proceeding, the person shall be indemnified against actual and reasonable expenses (including attorney fees) incurred by the person in connection with the action, suit, or proceeding and any action, suit, or proceeding brought to enforce the mandatory indemnification provided by section 10.03. SECTION 4. DEFINITION. For the purposes of section 10.01 and 10.02, "other enterprises" shall include employee benefit plans; "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and "serving at the request of a Corporation" shall include any service as a director, officer, employee, or agent of the Corporation that imposes duties on, or involves services by, the director or officer and respect to an employee benefit plan, its participants, or its beneficiaries; and a person who acted in good faith and in a manner the person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be considered to have acted in a manner "not opposed to the best interest of the Corporation or its shareholders' as referred to in sections 10.01 and 10.02. 11 SECTION 5. CONTRACT RIGHT; LIMITATION ON INDEMNITY. The right to indemnification conferred in Article X shall be a contract right, and shall apply to services of a director or officer as an employee or agent of the Corporation as well as in the person's capacity as a director or officer. Except as provided in section 10.03 of these bylaws, the Corporation shall have no obligations under Article X to indemnify any person in connection with any proceeding, or part thereof, initiated by the person without authorization by the board of directors. SECTION 6. DETERMINATION THAT INDEMNIFICATION IS PROPER. Any indemnification under sections 10.01 or 10.02 of these bylaws (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case (a) when it is determined that indemnification of the person is proper in the circumstances because the person has met the applicable standard of conduct set forth in sections 10.01 or 10.02, whichever is applicable, and (b) on an evaluation of the reasonableness of expenses and amounts paid in settlement. The determination and evaluation shall be made in any of the following ways: 1. By a majority vote of quorum of the board consisting of directors who are not parties or threatened to be made parties to the action, suit, or proceeding. 2. If the quorum described in 1. above is not obtainable, then by majority vote of a committee consisting solely of two or more directors, duly designated by the board, who are not at the time parties or threatened to be made parties to the action, suit, or proceeding. 3. By independent legal counsel in a written opinion, which counsel shall be selected in of the following ways: (a) by the board or its committee in the manner prescribed in 1. or 2. above; or (b) if a quorum of the board cannot be obtained under 1. above and a committee cannot be designated under 2. above, by the board. 4. By the shareholders. However, shares held by directors, officers, employees, or agents who are parties or threatened to be made parties to the action, suit, or proceeding may not be voted. SECTION 7. PROPORTIONATE INDEMNITY. If a person is entitled to indemnification under sections 10.01 or 10.02 of these bylaws for a portion of expenses, including attorney fees, judgments, penalties, fines, and amounts paid in settlement; but not for the total amount, the Corporation shall indemnify the person for the portion of the expenses, judgments, penalties, fines, or amounts paid in settlement for which the person is entitled to be indemnified. 12 SECTION 8. EXPENSE ADVANCE. The Corporation may pay or reimburse the reasonable expenses incurred by a person referred to in section 10.01 or 10.02 of these bylaws who is a party or threatened to be made a party to an action, suit, or proceeding in advance of final disposition of the proceeding if all of the following apply: (a) the person furnishes the Corporation in written affirmation of his good faith belief that he has met the applicable standard of conduct set forth in sections 10.01 or 10.02; (b) the person furnishes the Corporation a written undertaking executed personally, or on his behalf, to repay the advance if it is ultimately determined that he did not meet the standard of conduction; and (c) a determination is made that the facts then known to those making the determination would not preclude indemnification under sections 10.01 or 10.02. The authorization of payment must be made in the manner specified in section 10.06. The undertaking shall be an unlimited general obligation of the person on whose behalf advances are made, but it need not be secured. SECTION 9. NON-EXCLUSIVITY OF RIGHTS. The indemnification or advancement of expenses provided under this article is not exclusive of other rights to which a person seeking indemnification or advancement of expenses may be entitled under a contractual arrangement with the Corporation. However, the total amount of expenses advanced or indemnified from all sources combined shall not exceed the amount of actual expenses incurred by the person seeking indemnification or advancement of expenses. SECTION 10. INDEMNIFICATION OF EMPLOYEES AND AGENTS OF THE CORPORATION. The Corporation may, to the extent authorized from time to time by the board of directors, grant rights to indemnification and to the advancement of expenses to any employee or agent of the Corporation to the fullest extent of the provisions of Article X with respect to the indemnification and advancement of expenses of directors and officers of the Corporation. SECTION 11. FORMER DIRECTORS AND OFFICERS. The indemnification provided in Article X continues for a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors, and administrators of the person. SECTION 12. INSURANCE. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against the person and incurred by him in any such capacity or arising out of his status as such, whether or not the Corporation would have power to indemnify the person against the liability under these bylaws or the laws of the state of Michigan. SECTION 13. CHANGES IN MICHIGAN LAW. If there is any change of the Michigan statutory provisions applicable to the Corporation relating to the subject matter of Article X, 13 then the indemnification to which any person shall be entitled under this article shall be determined by the changed provisions, but only to the extent that the change permits the Corporation to provide broader indemnification rights than the provisions permitted the Corporation to provide before the change. Subject to section 10.14, the board of directors is authorized to amend these bylaws to conform to any such changed statutory provisions. SECTION 14. AMENDMENT OR REPEAL OF ARTICLE X. No amendment or repeal of Article X shall apply to or have any effect on any director or officer of the Corporation for or with respect to any acts or omissions of the director or officer occurring before the amendment or repeal. I, Hugh C. O'Donnell, Secretary of Milacron Industrial Products, Inc., a Michigan Corporation, do hereby certify that the foregoing bylaws are a true and complete copy of the bylaws of this Corporation as adopted as the bylaws of this Corporation. IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the seal of this Corporation, this 14th day of January, 1999. /s/ Hugh C. O'Donnell -------------------------------- Hugh C. O'Donnell, Secretary 14 EX-3.39 37 y98028exv3w39.txt ARTICLES OF INCORPORATION EXHIBIT 3.39 (PROFIT DOMESTIC CORPORATION) ARTICLES OF INCORPORATION OF OAK OIL & CHEMICAL INCORPORATED Name of Corporation These Articles of Incorporation are signed by the incorporator(s) for the purpose of forming a profit corporation pursuant to the provisions of Act 284, Public Acts of 1972, as follows: ARTICLE I. The name of the corporation is OAK OIL & CHEMICAL INCORPORATED ARTICLE II. The purpose or purposes for which the corporation is organized is to engage in any activity within the purposes for which corporations may be organized under the Business Corporation Act of Michigan. To develop, manufacture and sell lubricants and other oil products and to develop, manufacture and sell chemical products; in connection with the foregoing, to purchase, lease, or otherwise acquire, to mortgage, grant a security interest in or otherwise encumber, and to sell, lease, give away or otherwise dispose of lands, buildings, equipment, inventory, accounts, patents, trade names, good will and other intangibles, and any other type of property, whether real, personal or mixed, and whether located within or without the State of Michigan. In connection with the foregoing, to retain the services of employees on a part or full time basis and to pay reasonable compensation to such employees, including furnishing of or reimbursement for travel expenses and further including bonuses, pensions, profit sharing plans, employees and dependent insurance and other employee benefits. In general, to do and perform every act and function and to carry on any business in connection therewith and incident thereto not forbidden by the laws of the State of Michigan and with all the powers conferred upon corporations by the laws of the State of Michigan and to engage in any activity not prohibited by law which, in the judgment of the Board of Directors of the corporation, is likely to directly or indirectly benefit the corporation or to enhance the value of its property, and further, to engage in any activity within the purposes for which corporations may be organized under the Michigan Business Corporation Act. ARTICLE III. (Use the following if the shares are to consist of one class only) The total authorized capital stock is: (1) Common shares 50,000 Per Value $1.00 per share ------------- (No. of Shares) OR (2) Common shares without par value. ------------- (No. of Shares) GOLD SEAL APPEARS ONLY ON ORIGINAL ARTICLE IV. (Use the following if the shares are to be divided into classes) The total authorized capital stock is: {Preferred shs __________ Per Value $________________} (1) per share {Common shs _____________ Per Value $________________} {Preferred ______________________} and/or shs of (2) no par value {Common__________________________} (3) A statement of all or any of the relative rights, preferences and limitations of the shares of each class is as follows: ARTICLE V. The address of the initial registered office is: 1210 White Street, Sturgis 49091 - --------------------- --------------------------- Michigan ------------------- (No. and Street) (Town in City) (Zip Code) The mailing address of the initial registered office is (need not be completed unless different from the above address): 1160 White Street, Sturgis 49091 - ------------------ -------------------------------- Michigan ------------------- (No. and Street) (Town in City) (Zip Code) The Name of the initial resident agent at the registered office is: Lawrence A. Franks ARTICLE VI. The name(s) and address(es) of the incorporator(s) are as follows:
Name Residence or Business Address ---- -------------------------------- Eugene E. Eldridge 1107 S. Lakeview, Sturgis, Michigan Lawrence A. Franks 609 E. Chicago Road, Sturgis, Michigan Fred Earl Edwards 8925 E. 16th Place, Indianapolis, Indiana Alfred Brian Aikins 978 Prospect Ave., Elmhurst, Illinois Newell A. Franks 511 N. Lakeview, Sturgis, Michigan - ------------------------------------------------------------------------------ - ------------------------------------------------------------------------------ - ------------------------------------------------------------------------------ - ------------------------------------------------------------------------------ - ------------------------------------------------------------------------------
GOLD SEAL APPEARS ONLY ON ORIGINAL ARTICLE VII. [ILLEGIBLE] ARTICLE VIII. [ILLEGIBLE] insert any desired additional provisions authorized by the Act) CUMULATIVE VOTING: In all elections for directors of the corporation, every stockholder entitled to vote shall have the right to vote in person or by proxy the number of shares of stock owned by him for as many persons as there may be directors to be elected, or to cumulate said shares and give one candidate as many votes as will equal the number of directors multiplied by the number of shares of his stock, or to distribute them on the same principle among as many candidates as he shall think fit. The entire number of directors to be elected shall be balloted for at one and the same time, and not separately. PRE-EMPTIVE RIGHTS: Upon any increased issue of the capital stock of the corporation, the stockholders of record at the time of such issue shall have the pro-rata preferential right to subscribe therefor at such price and on such terms as the Board of Directors may in each instance fix, such pre-emptive rights of existing shareholders to be proportionate to their stockholdings at the time of any such increased issue. AMENDMENT OF ARTICLES OF INCORPORATION AND BY-LAWS: No amendment shall be made to the Articles of Incorporation except by an affirmative vote of two-thirds' of the outstanding shares entitled to vote thereon. The By-Laws may be amended in the manner provided by law except that the Board of Directors shall not amend or repeal any By-Law fixing their qualifications, number, classifications or term of office. IN WITNESS WHEREOF, the undersigned, the incorporator(s) of the above-named corporation, has (have) hereunto signed these Articles of Incorporation on this 15th day of March, 1973. /s/ Eugene E. Eldridge ________________________________ - ------------------------------ Eugene E. Eldridge /s/ Lawrence A. Franks ________________________________ - ------------------------------ Lawrence A. Franks /s/ Fred Earl Edwards ________________________________ - ------------------------------ Fred Earl Edwards /s/ Alfred Brian Aikins ________________________________ - ------------------------------ Alfred Brian Aikins /s/ Newell A. Franks ________________________________ - ------------------------------ Newell A. Franks (See Instruction on Reverse Side) GOLD SEAL APPEARS ONLY ON ORIGINAL (Please do not write in spaces below - for Department use) MICHIGAN DEPARTMENT OF COMMERCE - CORPORATION AND SECURITIES BUREAU Date Received F I L E D MARCH 16 1973 MAR 22 1973 [ILLEGIBLE] DIRECTOR Michigan Department of Commerce INFORMATION AND INSTRUCTIONS Articles of Incorporation -- Profit Domestic Corporations 1. Article I - The corporate name of a domestic profit corporation is required to contain one of the following words or abbreviations: "Corporation", "Company", "Incorporated", "Limited", "Corp.", "Co." "Inc.", or "Ltd." 2. Article II may state, in general terms , the character of the particular business to be carried on. Under section 202(b) of the law, it is a sufficient compliance to state substantially, alone or with specifically enumerated purposes, that the corporation may engage in any activity within the purposes for which corporations may be organized under the Business Corporation Act. The law requires, however, that educational corporations must state their specific purposes. 3. Articles III and IV - The law requires the incorporators of a domestic corporation having shares without par value to submit in writing the amount of consideration proposed to be received for each share which shall be allocated to stated capital. 4. Article VI - The law requires one or more incorporators. The addresses should include a street number and name (or other designation), in addition to the name of the city and state. 5. The duration of the corporation should be stated in the Articles only if the duration is not perpetual. 6. The Articles must be signed in ink by each incorporator. The names of the incorporators as set out in Article VI should correspond with the signatures. 7. One original copy of the Articles is required. A true copy will be prepared by the Corporation and Securities Bureau and returned to the person submitting the Articles for filing. 8. An effective date, not later than 90 days subsequent to the date of filing, may be stated in the Articles of Incorporation. 9. FEES: Filing Fee.................................................. $10.00 Franchise Fee - 5 mill on each dollar of authorized capital stock, with a minimum franchise fee of...................... $25.00 (Make fee payable to State of Michigan) 10. Mail Articles of Incorporation and fees to: Michigan Department of Commerce Corporation and Securities Bureau Corporation Division P.O. Drawer C Lansing, Michigan 48904 GOLD SEAL APPEARS ONLY ON ORIGINAL (For Use by Domestic Corporations) CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION The undersigned corporation executes the following Certificate of Amendment to its Articles of Incorporation pursuant to the provisions of Section 633, Act 284, Public Acts of 1972, as amended. 1. The name of the corporation is Oak Oil & Chemical, Incorporated 2. The location of the registered office is ____________________________ 1160 White Street Sturgis 49091 - ----------------------------------------------------- Michigan ---------------- (No. and Street) (Town or City) (Zip Code) 3. The following amendment to the Articles of Incorporation was adopted on the 10 day of December, 1976. (Check one of the following) [ ] by the shareholders in accordance with Section 611(2), Act 284, Public Acts of 1972, as amended. The necessary number of shares as required by statute were voted in favor of the amendment. [ ] by written consent of the shareholders having not less than the minimum number of votes required by statute in accordance with Section 407(1) and (2), Act 264, Public Acts of 1972, as amended. Written notice to shareholders who have not consented in writing has been given. (Note: Written consent by less than all of the shareholders is permitted only if such provision appears in Articles of Incorporation). [x] by written consent of all the shareholders entitled to vote in accordance with Section 407(3), Act 284, Public Acts of 1972, as amended. Resolved, that Article III of the Articles of Incorporation be amended to read as follows: (Any article being amended is required to be set forth in its entirety.) The total authorized capital stock is: (1) Common Shares 50,000 Par Value 20 cents per share Oak Oil & Chemical, Incorporated ------------------------------------------ (Corporate Name) By /s/ A. Brian Aikins, President --------------------------------------- (Signature of President, Vice-President, Chairman or Vice-Chairman) A. Brian Aikins, President ------------------------------------------ (Type or Print Name and Title) Signed this 1 day of January, 1977 GOLD SEAL APPEARS ONLY ON ORIGINAL (See Instructions on Reverse Side) (Please do not write in spaces below - for Department use) MICHIGAN DEPARTMENT OF COMMERCE - CORPORATION AND SECURITIES BUREAU Date Received [ILLEGIBLE] FILED FEB 10 1977 DIRECTOR Michigan Department of Commerce C & S - III (Rev. 2-74) INFORMATION AND INSTRUCTIONS Certificate of Amendment - Domestic Corporation 1. This form may be used by both profit and non-profit corporations. In case of a non-profit corporation organized on a non-stock basis, "shareholders" shall be construed to be synonymous with "members". 2. An effective date, not later than 90 days subsequent to the date of filing may be stated in the Certificate of Amendment. 3. The Certificate of Amendment is required to be signed in ink by the chairman or vice-chairman of the board of directors or the president or a vice-president of the corporation. 4. One original copy is required. A true copy will be prepared by the Corporation and Securities Bureau and returned to the person submitting the Certificate of Amendment for filing. 5. FEES, Filing Fee...................................... $10.00 Franchise Fee (payable only in case of increase in authorized capital stock)-1/2 million each dollar of increase over highest previous authorized capital stock .............. (Make fee payable to State of Michigan) 6. Mail form and fee to: Michigan Department of Commerce Corporation and Securities Bureau Corporation Division P.O. Drawer C Lansing, Michigan 48904 GOLD SEAL APPEARS ONLY ON ORIGINAL MICHIGAN DEPARTMENT OF COMMERCE - CORPORATION AND SECURITIES BUREAU (FOR BUREAU USE ONLY) FILED DATE RECEIVED DEC 20 1984 DEC 03 1984 Administrator MICHIGAN DEPARTMENT OF COMMERCE Corporation & Securities Bureau CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION FOR USE BY DOMESTIC CORPORATIONS (Please read instruction on last page before completing form) Pursuant to the provisions of Act 284, Public Acts of 1972, as amended (profit corporations), or Act 162, Public Acts of 1982 (nonprofit corporations), the undersigned corporation executes the following Certificate: 1. The name of the corporation is: OAK OIL & CHEMICAL, INC. 2. The corporation Identification number(CID) assigned by the Bureau is: 120-709 3. The location of its registered office is: 1160 White Street, Sturgis 49091 ---------------------------------, Michigan ---------- Street Address (City) (Zip Code) 4. Article I of the Articles of Incorporation is hereby amended to read as follows: ARTICLE I The name of the corporation is OAK INTERNATIONAL CHEMICAL, INC. GOLD SEAL APPEARS ONLY ON ORIGINAL 5. The foregoing amendment to the Articles of incorporation was duly adopted on the 1 day of NOVEMBER, 1984, in accordance with the provisions of the Act. This Amendment (Complete and execute either a or b below, but not both.) a. [ ] was duly adopted by the unanimous consent of the incorporator(s) before the first meeting of the board of directors or trustees. Signed this _________ day of ________________________, 19_____________. ______________________________ ____________________________________ ______________________________ ____________________________________ ______________________________ ____________________________________ ______________________________ ____________________________________ (Signature of all incorporators; type or print name under each signature) b. (Check one of the following) [ ] was duly adopted by the shareholders or members, or by the directors if it is a nonprofit corporation organized on a nonstock directorship basis, in accordance with Section 811(2) of the Act. The necessary votes were cast in favor of the amendment. [ ] was duly adopted by written consent of the shareholders or members having not less than the minimum number of votes required by statute in accordance with Section 407(1) and (2) of the Act. Written notice to shareholders or members who have not consented in writing has been given. (Note: Written consent by less than all of the shareholders or members is permitted only if such provision appears in the Articles of incorporation.) [X] was duly adopted by written consent of all the shareholders or members entitled to vote in accordance with Section 407(3) of the Act. Signed this 1 day of NOVEMBER, 1984 By: /s/ A. Brian Aikins --------------------------------------- (Signature) A. BRIAN AIKINS -- PRESIDENT ------------------------------------------- (Type or Print Name and Title) GOLD SEAL APPEARS ONLY ON ORIGINAL DOCUMENT WILL BE RETURNED TO NAME AND MAILING ADDRESS INDICATED IN THE BOX BELOW. Include name, street and number(or P.O. box), city, state and ZIP code. Mr. Raymond H. Dresser, Jr. DRESSER, MARKS, SVENDSEN, OSTER & BIRD Telephone: 112 South Monroe Street Area Code 616 Sturgis, Michigan 49091 Number 651-3281 INFORMATION AND INSTRUCTIONS 1. Submit one original copy of this document. Upon filing, a microfilm copy will be prepared for the records of the Corporation and Securities Bureau. The original copy will be returned to the address appearing in the box above as evidence of filing. Since this document must be microfilmed, it is important that the filing be legible. Documents with poor black and white contrast, or otherwise illegible, will be rejected. 2. This document is to be used pursuant to the provisions of section 831 of the Act for the purpose of amending the articles of incorporation of a domestic corporation. 3. Item 2- Enter the identification number previously assigned by the bureau. If this number is unknown, leave it blank. 4. Item 4- The entire article being amended must be set forth in its entirety. However, if the article being amended is divided into separately identified sections, only the sections being amended need be included. 5. This document is effective on the date approved and filed by the Bureau. A later effective date, no more than 90 days after the date of delivery, may be stated. 6. If the amendment is adopted before the first meeting of the board of directors, item 5(a) must be completed and signed in ink by all of the incorporators. If the amendment is otherwise adopted, item 5(b) must be completed and signed in ink by the president, vice-president, chairperson, or vice-chairperson of the corporation. 7. FEES: Filing fee (Make remittance payable to State of Michigan)...$10.00 Franchise fee for profit corporations (payable only if authorized capital stock has increased)-1/2 mill(.0005) on each dollar of increase over highest previous authorized capital stock. 8. Mail form and fee to: Michigan Department of Commerce Corporation and Securities Bureau Corporation Division P.O. Box 30054 Lansing, Michigan 48909 Telephone: (517) 373-0493 GOLD SEAL APPEARS ONLY ON ORIGINAL MICHIGAN DEPARTMENT OF COMMERCE - CORPORATION AND SECURITIES BUREAU (FOR BUREAU USE ONLY) Date Received MAR 27 1989 FILED MAR 29 1989 Administrator MICHIGAN DEPT OF COMMERCE Corporation & Securities Bureau CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION FOR USE BY DOMESTIC CORPORATION (Please read instructions and Paperwork Reduction Act notice on last page) Pursuant to the provisions of Act 284, Public Acts of 1972, as amended (profit corporations), or Act 162, public Acts of 1982, as amended (nonprofit corporations). the undersigned corporation executes the following Certificate: 1. The present name of the corporation is: OAK INTERNATIONAL CHEMICAL, INC. 2. The corporation identification number (CID) assigned by the Bureau is: 120-709 3. The location of its registered office is: 1160 White street, Sturgis 49091 -------------------------------------------------, Michigan ------------ (Street Address) (City) (Zip Code) 4. Article I of the Article of Incorporation is hereby amended to read as follows: ARTICLE I The name of the corporation is OAK INTERNATIONAL, INC. GOLD SEAL APPEARS ONLY ON ORIGINAL 5. COMPLETE SECTION (a) IF THE AMENDMENT WAS ADOPTED BY THE UNANIMOUS CONSENT OF THE INCORPORATOR(S) BEFORE THE FIRST MEETING OF THE BOARD OF DIRECTORS OR TRUSTEES ; OTHERWISE , COMPLETE SECTION (b) a. [ ] The foregoing amendment to the Articles of Incorporation was duly adopted on the__________ day of ______________, 19_________, in accordance with the provisions of the Act by the unanimous consent of the incorporator(s) before the first meeting of the board of directors or trustees. Signed this ____day of________________________________________________,19_______ ______________________________ ________________________________________ ______________________________ ________________________________________ ______________________________ ________________________________________ ______________________________ ________________________________________ (Signatures of all incorporators: type or print name under each signature) b. [X] The foregoing amendment to the Articles of Incorporation was duly adopted on the 30 day of , December , 1986. The amendment : (check one of the following) [ ] was duly adopted in accordance with Section 611(2) of the Act by the vote of the shareholders if a profit corporation, or by the vote of the shareholders or members if a nonprofit corporation, or by the vote of the directors if a nonprofit corporation organized on a nonstock directorship basis. The necessary votes were cast in favour of the amendment. [ ] was duly adopted by the written consent of all the directors pursuant to Section 525 of the Act and the corporation is a nonprofit corporation organized on a nonstock directorship basis. [ ] was duly adopted by the written consent of the shareholders or members having not less than the minimum number of votes required by statute in accordance with Section 407(1) and (2) of the Act. Written notice to shareholders or members who have not consented in writing has been given. (Note: Written consent by less than all of the shareholders or members is permitted only if such provision appears in the Articles of Incorporation.) [X] was duly adopted by the written consent of all the shareholders or members entitled to vote in accordance with Section 407(3) of the Act. Signed this 30 day of December , 1988 By /s/ A. Brian Aikins ------------------------------------------------ (Signature) A. Brian Aikins, President ------------------------------------------------ (Type or Print Name) (Type or Print Title) GOLD SEAL APPEARS ONLY ON ORIGINAL DOCUMENT WILL BE RETURNED TO NAME AND Name of person or organization MAILING ADDRESS INDICATED IN THE BOX BELOW. remitting fees: Include name, street and number(or P.O. box) city, state and ZIP code. Dresser Law Office, P.C. ---------------------------- Mr. Raymond H. Dresser, Jr. Preparer's name and business Dresser Law Office, P.C. telephone number: 112 South Monroe Street Sturgis, MI 49091 R. H. Dresser, Jr. (616) 651-3281 INFORMATION AND INSTRUCTIONS 1. The amendment cannot be filed until this form, or a comparable document is submitted. 2. Submit one original copy of this document. Upon filing, a microfilm copy will be prepared for the records of the Corporation and Securities Bureau. The original copy will be returned to the address appearing in the box above as evidence of filing. Since this document must be microfilmed, it is important that the filing be legible. Documents with poor black and white contrast, or otherwise illegible, will be rejected. 3. This document is to be used pursuant to the provisions of section 631 of the Act for the purpose of amending the articles of incorporation of a domestic profit or nonprofit corporation. Do not use this form for restated articles. A nonprofit corporation is one incorporated to carry out any lawful purpose or purposes not involving pecuniary profit or gain for its directors, officers, shareholders, or members. A nonprofit corporation organized on a nonstock directorship basis, as authorized by Section 302 of the Act, may or may not have members, but if it has members, the members are not entitled to vote. 4. Item 2- Enter the identification number previously assigned by the Bureau. If this number is unknown, leave it blank. 5. Item 4- The article being amended must be set forth in its entirety. However, if the article being amended is divided into separately identifiable sections, only the sections being amended need be included. 6. This document is effective on the date approved and filed by the Bureau. A later effective date, no more than 90 days after the date of delivery, may be stated. 7. If the amendment is adopted before the first meeting of the board of directors, item 5(a) must be completed and signed in ink by all of the incorporators listed in Article V of the Articles of Incorporation. If the amendment is otherwise adopted, item 5(b) must be completed and signed in ink by the president, vice-president, chairperson, or vice-chairperson of the corporation. 8. FEES: Filing fee (Make remittance payable to State of Michigan).....$10.00 Franchise fee for profit corporations (payable only if authorized capital stock has increased)-1/2 mill (.0005) on each dollar of increase over highest previous authorized capital stock. 9. Mail form and fee to : Michigan Department of Commerce Corporation and Securities Bureau Corporation Division P.O. Box 30054 6546 Mercantile Way Lansing, MI 48909 Telephone: (517)-334-6302 GOLD SEAL APPEARS ONLY ON ORIGINAL MICHIGAN DEPARTMENT OF CONSUMER AND INDUSTRY SERVICES CORPORATION , SECURITIES AND LAND DEVELOPMENT BUREAU - -------------------------------------------------------------------------------- Date Received (FOR BUREAU USE ONLY) ADJUSTED TO AGREE WITH BUREAU RECORDS Tran Info: 1 3096400-1 05/26/2000 Chk#: 108024904 ID: Amt.: $5.00 Name 120709 FILED C T Corporation System JUN 05 2000 - ----------------------------- Address Administrator 441 Vine Street, Suite 3810 CORP. SECURITIES & LAND DEV. BUREAU - ----------------------------- City State Zip Code Cincinnati, Ohio 45202 EFFECTIVE DATE: DOCUMENT WILL BE RETURNED TO THE NAME AND ADDRESS YOU ENTER ABOVE CERTIFICATE OF CHANGE OF REGISTERED OFFICE AND/OR CHANGE OF RESIDENT AGENT FOR USE BY DOMESTIC AND FOREIGN CORPORATIONS AND LIMITED LIABILITY COMPANIES (Please read information and instructions on reverse side) Pursuant to the provisions of Act 284, Public Acts of 1972( profit corporations), or Act 162, public Acts of 1982 (nonprofit corporations), or Act 23, Public Acts of 1993 (limited liability companies ), the undersigned corporation or limited liability company executes the following Certificate: - -------------------------------------------------------------------------------- 1. The name of the corporation or limited liability company is : Oak International, Inc. ------------------------- 2. The identification number assigned by the Bureau is: 120709 3. a. The name of the resident agent on file with the Bureau is: Lawrence A. Franks ---------------------------- b. The location of registered office on file with the Bureau is : 1160 White Street Sturgis 49091- -------------------------------, Michigan ---------------------------------- (Street Address) (City) (Zip Code) c. The mailing address of the above registered office on file with the Bureau is : POB 850 Sturgis 49091- ----------------------------------------------------, Michigan ------------- (Street Address or P.O. Box ) (City) (Zip Code) ENTER IN ITEM 4 THE INFORMATION AS IT SHOULD NOW APPEAR ON THE PUBLIC RECORD 4. a. The name of the resident agent is : THE CORPORATION COMPANY ------------------------------------- b. The address of the registered office is : 30600 Telegraph Road Bingham Farms 48025 --------------------------------------, Michigan ----------------------- (Street Address) (City) (Zip Code) c. The mailing address of the registered office IF DIFFERENT THAN 4B is : -------------------------------------------------------, Michigan ---------- (Street Address or P.O. Box) (City ) (Zip Code) 5. The above changes were authorized by resolution duly adopted by: 1. ALL CORPORATIONS: its board of directors; 2. PROFIT CORPORATIONS ONLY : the resident agent if only the address of the registered office is changed, in which case a copy of this statement has been mailed to the corporation; 3. LIMITED LIABILITY COMPANIES: an operating agreement, affirmative vote of a majority of the members pursuant to section 502(1), managers pursuant to section 405, or the resident agent if only the address of the registered office is changed. The corporation or limited liability company further states that the address of its registered office and the address of its resident agent as changed, are identical. Signature Type or Print Name and Title Date Signed /s/ Hugh C. O'Donnell Hugh C. O'Donnell 5/11/2000 GOLD SEAL APPEARS ONLY ON ORIGINAL EX-3.40 38 y98028exv3w40.txt BYLAWS EXHIBIT 3.40 Attachment A BYLAWS OF OAK INTERNATIONAL, INC. ARTICLE I Stockholders SECTION 1. Annual Meetings and Special Meetings. The annual meeting of the stockholders of the corporation shall be held on a day duly designated by the Board of Directors in April of each year, if not a legal holiday, and if a legal holiday then the next succeeding day not a legal holiday, for the purpose of electing directors to succeed those whose terms shall have expired as of the date of such annual meeting, and for the transaction of such other corporate business as may come before the meeting. Special meetings of the stockholders may be called at any time for any purpose or purposes by the Chairman of the Board, the President, by a Vice-President, or by a majority of the Board of Directors, and shall be called forthwith by the Chairman of the Board, the President, by a Vice-President, the Secretary, or any director of the Corporation upon the request in writing of the holders of a majority of all the shares outstanding and entitled to vote on the business to be transacted at such meeting. Such request shall state the purpose or purposes of the meetings. Business transacted at all special meetings of stockholders shall be confined to the purpose or purposes stated in the notice of the meetings. SECTION 2. Place of Holding Meetings. All meetings of stockholders shall be held at the principal office of the Corporation or elsewhere in the United States as designated by the Board of Directors. SECTION 3. Notice of Meetings. Written notice of each meeting of the stockholders shall be mailed, postage prepaid by the Secretary, to each stockholder of record entitled to vote thereat at his post office address, as it appears upon the books of the Corporation, at least ten (10) days before the meetings. Each such notice shall state the place, day, and hour at which the meetings is to be held and, in the case of any special meeting, shall state briefly the purpose or purposes thereof. SECTION 4. Quorum. The presence in person or by proxy of the holders of record of a majority of the shares of the capital stock of the corporation issued and outstanding and entitled to vote thereat shall constitute a quorum at all meetings of the stockholders, except as otherwise provided by law, by the Articles of Incorporation or by these Bylaws. If less than a quorum shall be in attendance at the time for which the meeting shall have been called, the meeting may be adjourned from time to time by a majority vote of the stockholders present or represented, without any notice other than by announcement at the meeting, until a quorum shall attend. At any adjourned meeting at which a quorum shall attend, any business may be transacted which might have been transacted if the meeting had been held as originally called. SECTION 5. Conduct of Meetings. Meetings of stockholders shall be presided over by the President of the Corporation or, if he is not present, by a Vice-President, or, if none of said officers is present, by a chairman to be elected at the meeting. The Secretary of the Corporation, or if he is not present, any Assistant Secretary shall act as secretary of such meetings; in the absence of the Secretary and any Assistant Secretary, the presiding officer may appoint a person to act as Secretary of the meeting. SECTION 6. Voting. At all meetings of stockholders, every stockholder entitled to vote thereat shall have one (1) vote for each share of stock standing in his name on the books of the Corporation on the date for the determination of stockholders entitled to vote at such meeting. Such vote may be either in person or by proxy appointed by an instrument in writing subscribed by such stockholder or his duly authorized attorney, bearing a date not more than three (3) months prior to said meeting, unless said instrument provides for a longer period. Such proxy shall be dated, but need not be sealed, witnessed or acknowledged. All elections shall be had and all questions shall be decided by a majority of the votes cast at a duly constituted meeting, except as otherwise provided by law, in the Articles of Incorporation or by these Bylaws. If the chairman of the meeting shall so determine, a vote by ballot may be taken upon any election or matter, and the vote shall be so taken upon the request of the holders of ten percent (10%) of the stock entitled to vote on such election or matter. In either of such events, the proxies and ballots shall be received and be taken in charge and all questions touching the qualification of voters and the validity of proxies and the acceptance or rejection of votes, shall be decided by the teller. Such tellers shall be appointed by the chairman of said meeting. SECTION 7. Action Without Meeting. Any action required or permitted to be taken at any meeting of the stockholders may be taken without a meeting without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the stockholders entitled to vote thereon. ARTICLE II Board of Directors SECTION 1. General Powers. The property and business of the Corporation shall be managed under the direction of the Board of Directors of the Corporation. SECTION 2. Number and Term of Office. The number of directors shall be one (1) or such other number, as may be designated from time to time by resolution of a majority of the entire Board of Directors. Directors need not be stockholders. The directors shall be elected each year at the annual meeting of stockholders. The directors shall be elected each year at the annual meeting of stockholders, except as hereinafter provided, and each director shall serve until his successor shall be elected and shall qualify. SECTION 3. Filling of Vacancies. In the case of any vacancy in the Board of Directors through death, resignation, disqualification, removal, or other cause, the remaining directors, by affirmative vote of the majority thereof, may elect a successor or hold office for the unexpired portion of the term of the director whose place shall be vacant, and until the election of his successor, or until he shall be removed, prior thereto, by an affirmative vote of the holders of a majority of the stock. Similarly, and in the event of the number of directors being increased as provided in these Bylaws, the additional directors so provided for shall be elected by a majority of the entire Board of Directors already in office, and shall hold office until the next annual meeting of stockholders and thereafter until his or their successors shall be elected. Any director may be removed from office with or without cause by the affirmative vote of the holders of the majority of the stock issued and outstanding and entitled to vote at any special meeting of stockholders regularly called for the purpose. SECTION 4. Place of Meeting. The Board of Directors may hold their meetings and have one or more offices, and keep the books of the Corporation, either within or outside the State of Michigan, at such place or places as they may from time to time determine by resolution or by written consent of all the directors. The Board of Directors may hold their meetings by conference telephone or other similar electronic communications equipment in accordance with the provisions of the Michigan Business Corporation Act. SECTION 5. Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such time and place as shall from time to time be determined by resolution of the board, provided that notice of every resolution of the Board fixing or changing the time or place for the holding of regular meetings of the Board shall be mailed to each director at least three (3) days before the first meeting held pursuant thereto. The annual meeting of the Board of Directors shall be held immediately following the annual stockholders' meeting at which a Board of Directors is elected. Any business may be transacted at any regular meeting of the Board. SECTION 6. Special Meetings. Special meetings of the Board of Directors shall be held whenever called by direction of the Chairman of the Board or the President and must be called by the Chairman of the Board, the President or the Secretary upon written request of a majority of the Board of Directors. The Secretary shall give notice of each special meeting of the Board of Directors, by mailing the same at least three (3) days prior to the meeting or by telegraphing the same at least two (2) days before the meeting, to each director; but such notice may be waived by any director. Unless otherwise indicated in the notice thereof, any and all business may be transacted at any special meetings. At any meeting at which every director shall be present, even though without notice, any business may be transacted and any director may in writing waive notice of the time, place and objectives of any special meeting. SECTION 7. Quorum. A majority of the whole number of directors shall constitute a quorum for the transaction of business at all meetings of the Board of Directors, but, if at any meeting less than a quorum shall be present, a majority of those present may adjourn the meeting from time to time, and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by law or by the Articles of Incorporation or by these Bylaws. SECTION 8. Action Without Meeting. Any action required or permitted to be taken at any meeting of the directors may be taken without a meeting without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the directors entitled to vote thereon. SECTION 9. Compensation of Directors. Directors shall not receive any stated salary for their services. Nothing herein contained shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. SECTION 10. Committees. The Board of Directors may, by resolution passed by a majority of the whole Board, designated one or more committees, each committee to consist of two or more of the directors of the Corporation, which, to the extent provided in the resolution, shall have and may exercise the powers of the Board of Directors, and may authorize the seal of the Corporation to be affixed to all papers which may require it. Such committee or committees shall have such names as may be determined from time to time by resolution adopted by the Board of Directors. ARTICLE III Officers SECTION 1. Election, Tenure, and Compensation. The officers of the Corporation shall be a President, a Secretary, and a Treasurer, and also such other officers including a Chairman of the Board and/or one or more Vice-Presidents and/or one or more assistants to the foregoing officers as the Board of Directors from time to time may consider necessary for the proper conduct of the business of the Corporation. The officers shall be elected annually by the Board of Directors at its first meeting following the annual meeting of the stockholders. The President and Chairman of the Board shall be a director and the other officers may, but need not be, directors. Any two or more of the above offices, except those of President and Vice-President, may be held by the same person, but no officer shall execute, acknowledge or verify any instrument in more than one capacity if such instrument is required by law or by these Bylaws to be executed, acknowledged, or verified by any two or more officers. In the event that any office other than an office required by law, shall not be filled by the Board of Directors or, once filled, subsequently becomes vacant, then such office and all references thereto in these Bylaws shall be deemed inoperative unless and until such office is filled in accordance with the provisions of these Bylaws. Except where otherwise expressly provided in a contract duly authorized by the Board of Directors, all officers and agents of the Corporation shall be subject to removal at any time by the affirmative vote of a majority of the whole Board of Directors, and all officers, agents, and employees, shall hold office at the discretion of the Board of Directors or of the officers appointing them. SECTION 2. Powers and Duties of the Chairman of the Board. The Chairman of the Board shall preside at all meetings of the Board of Directors unless the Board of Directors shall by a majority vote of a quorum thereof elect a chairman other than the Chairman of the Board to preside at meetings of the Board of Directors. He may sign and execute all authorized bonds, contracts, or other obligations in the name of the Corporation; and he shall be ex-officio a member of all standing committees. SECTION 3. Powers and Duties of the President. The President shall have general charge and control of all its business affairs and properties. He shall preside at all meetings of the stockholders. The President may sign and execute all authorized bonds, contracts, or other obligations in the name of the Corporation. He shall have the general powers and duties of supervision and management usually vested in the office of president of a corporation. He shall do and perform such other duties as may, from time to time, be assigned to him by the Board of Directors. In the event that the Board of Directors does not take affirmative action to fill the office of Chairman of the Board, the President shall assume and perform all powers and duties given to the Chairman of the Board by these Bylaws. SECTION 4. Powers and Duties of the Vice-President. The Board of Directors may appoint a Vice-President and may appoint more than one Vice-President. Any Vice-President (unless otherwise provided by resolution of the Board of Directors) may sign and execute all authorized bonds, contracts, or other obligations in the name of the Corporation. Each Vice-President shall have such other powers and shall perform such other duties as may be assigned to him by the Board of Directors or by the President. In case of the absence or disability of the President, the duties of that office shall be performed by any Vice-President, and the taking of any action by any such Vice-President in place of the President shall be conclusive evidence of the absence or disability of the President. SECTION 5. Secretary. The Secretary shall give, or cause to be given, notice of all meetings of stockholders and directors and all other notices required by law or by these Bylaws, and in case of his absence or refusal or neglect to do so, any such notice may be given by any person thereunto directed by the President, or by the directors or stockholders upon whose written request the meeting is called as provided in these Bylaws. The Secretary shall record all the proceedings of the meetings of the stockholders and of the directors in books provided for that purpose, and he shall perform such other duties as may be assigned to him by the directors or the President. He shall have custody of the seal of the Corporation and shall affix the same to all instruments requiring it, when authorized by the Board of Directors or the President, and attest the same. In general, the Secretary shall perform all the duties generally incident to the office of Secretary, subject to the control of the Board of Directors and the President. SECTION 6. Treasurer. The Treasurer shall have custody of all the funds and securities of the Corporation, and he shall keep full and accurate account of receipts and disbursements in books belonging to the Corporation. He shall deposit all moneys and other valuables in the name and to the credit of the Corporation in such depository or depositories as may be designated by the Board of Directors. The Treasurer shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements. He shall render to the President and the Board of Directors, whenever either of them so requests, an account of all his transactions as Treasurer and of the financial condition of the Corporation. The Treasurer shall perform all the duties generally incident to the office of the Treasurer, subject to the control of the Board of Directors and the President. SECTION 7. Assistant Secretary. The Board of Directors may appoint an Assistant Secretary or more than one Assistant Secretary. Each Assistant Secretary shall (except as otherwise provided by resolution of the Board of Directors) have power to perform all duties of the Secretary in the absence or disability of the Secretary and shall have such other powers and shall perform such other duties as may be assigned to him by the Board of Directors or the President. In case of the absence or disability of the Secretary, the duties of the office shall be performed by any Assistant Secretary, and the taking of any action by any such Assistant Secretary in place of the Secretary shall be conclusive evidence of the absence or disability of the Secretary. SECTION 8. Assistant Treasurer. The Board of Directors may appoint an Assistant Treasurer or more than on Assistant Treasurer, Each Assistant Treasurer shall (except as otherwise provided by resolution of the Board of Directors) have power to perform all duties of the Treasurer in the absence or disability of the Treasurer and shall have such other powers and shall perform such other duties as may be assigned to him by the Board of Directors or the President. In case of the absence or disability of the Treasurer, the duties of the office shall be performed by any Assistant Treasurer, and the taking of any action by any such Assistant Treasurer in place of the Treasurer shall be conclusive evidence of the absence or disability of the Treasurer. ARTICLE IV Capital Stock SECTION 1. Issuance of Certificates of Stock. The certificates for shares of the stock of the Corporation shall be of such form not inconsistent with the Articles of Incorporation, or its amendments, as shall be approved by the board of Directors. All certificates shall be signed by the President or by the Vice-President and countersigned by the Secretary or by an Assistant Secretary. All certificates for each class of stock shall be consecutively numbered. The name of the person owning the shares issued and the address of the holder, shall be entered in the Corporation's books. All certificates surrendered to the Corporation for transfer shall be canceled and no new certificates representing the same number of shares shall be issued until the former certificate or certificates for the same number of shares shall have been so surrendered, and canceled, unless a certificate of stock be lost or destroyed, in which event another may be issued in its stead upon proof of such loss or destruction and unless waived by the President, the giving of a satisfactory bond of indemnity not exceeding an amount double the value of the stock. Both such proof and such bond shall be in a form approved by the general counsel of the Corporation and by the Transfer Agent of the Corporation and by the Registrar of the stock, SECTION 2. Transfer of Shares. Shares of the capital stock of the Corporation shall be transferred on the books of the Corporation only by the holder thereof in person or by his attorney upon surrender and cancellation of certificates for a like number of shares as herein before provided. SECTION 3. Registered Stockholders. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim to or interest in such share or shares in the name of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by the Laws of Michigan. SECTION 4. Closing Transfer Books. The Board of Directors may fix the time, not exceeding ten (10) days preceding the date of any meeting of stockholders or any dividend payment date or any date for the allotment of rights, during which time the books of the Corporation shall be closed against transfers of stock, or, in lieu thereof, the directors may fix a date not exceeding ten (10) days preceding the date of any meeting of stockholders or any dividend payment date or any date for the allotment of rights, as a record date for the determination of the stockholders entitled to notice of and to vote at such meeting or to receive such dividends or rights as the case may be; and only stockholders of record on such date shall be entitled to notice of and to vote at such meeting or to receive such dividends or rights as the case may be. ARTICLE V Corporation Seal SECTION 1. In the event that the President shall direct the Secretary to obtain a corporate seal, the corporate seal shall be circular in form and shall have inscribed thereon the name of the Corporation, the year of its organization and the word "Michigan." Duplicate copies of the corporate seal may be provided for use in the different offices of the Corporation but each copy thereof shall be in the custody of the Secretary of the Corporation or of an Assistant Secretary of the Corporation nominated by the Secretary. ARTICLE VI Bank Accounts and Loans SECTION 1. Bank Accounts. Such officers or agents of the Corporation as from time to time shall be designated by the Board of Directors shall have authority to deposit any funds of the Corporation in such banks or trust companies as shall from time to time be designated by the Board of Directors and such officers or agents as from time to time shall be authorized by the Board of Directors may withdraw any or all of the funds of the Corporation so deposited in any bank or trust company, upon checks, drafts or other instruments or orders for the payment of money, drawn against the account or in the name or behalf of this Corporation, and made or signed by such officers or agents; and each bank or trust company with which funds of the Corporation are so deposited is authorized to accept, honor, cash and pay, without limit as to amount, all checks, drafts or other instruments or orders for the payment of money, when drawn, made or signed by officers or agents so designated by the Board of Directors until written notice of the revocation of the authority of such officers or agents by the Board of Directors shall have been received by such bank or trust company. There shall from time to time be certified to the banks or trust companies in which funds of the Corporation are deposited, the signature of the officers or agents of the Corporation so authorized to draw against the same. In the event that the Board of Directors shall fail to designate the persons by whom checks, drafts, and other instruments or orders for the payment of money shall be signed, as hereinabove provided in this Section, all of such checks, drafts, and other instruments or orders for the payment of money shall be signed by the President or a Vice-President and countersigned by the Secretary or Treasurer or any Assistant Secretary or an Assistant Treasurer of the Corporation. SECTION 2. Loans. Such officers or agents of this Corporation as from time to time shall be designated by the Board of Directors shall have authority to effect loans, advances, or other forms of credit at any time or times for the Corporation from such banks, trust companies, institutions, corporations, firms, or persons as the Board of Directors shall from time to time designate, and as security for the repayment of such loans, advances, or other forms of credit to assign, transfer, endorse, and deliver, either originally or in addition or substitution, any or all stocks, bonds, rights and interests of any kind in or to stocks or bonds, certificates of such rights or interests, deposits, accounts, documents covering merchandise, bills and accounts receivable and other commercial paper and evidences of debt at any time held by the Corporation; and for such loans, advances, or other forms of credit to make, execute, and deliver one or more notes, acceptances, or written obligations of the Corporation on such terms, and with such provisions as to the security or sale or disposition thereof as such officers or agents shall deemed proper; and also to sell to, or discount or rediscount with, such banks, trust companies, institutions, corporations, firms, or persons any and all commercial paper, bills receivable, acceptances, and other instruments and evidences of debt at any time held by the Corporation, and to that end to endorse, transfer, and deliver the same. There shall from time to time be certified to each bank, trust company, institution, corporation, firm, or person so designated the signatures of the officers or agents so authorized; and each such bank, trust company, institution, corporation, firm, or person is authorized to rely upon such certification until written notice of the revocation by the Board of Directors of the authority of such officers or agents shall be delivered to such bank, trust company, institution, corporation, firm, or person. ARTICLE VII Reimbursements SECTION 1. Reimbursements. Any payments made to an officer or other employee of the Corporation, such as salary, commission, interest or rent, or entertainment expense incurred by him, which shall be disallowed in whole or in part as a deductible expense by the Internal Revenue Service, shall be reimbursed by such officer or other employee of the Corporation to the full extent of such disallowance. It shall be the duty of the Directors, as a Board, to enforce payment of each such amount disallowed. In lieu of payment by the officer or other employee, subject to the determination of the Directors, proportionate amounts may be withheld from his future compensation payments until the amount owed to the Corporation has been recovered. ARTICLE VIII Miscellaneous Provisions SECTION 1. Fiscal Year. The Corporation shall utilize a calendar year. SECTION 2. Notices. Whenever, under the provisions of these Bylaws, notice is required to be given to any director, officer, or stockholder, it shall not be construed to mean personal notice, but such notice shall be given in writing, by mail, by depositing the same in a post office or letter box, in a postpaid sealed wrapper, addressed to each stockholder, officer, or director at such address as appears on the books of the Corporation, or in default of any other address, to such director, officer, or stockholder, at the general post office in the City of Sturgis, Michigan and such notice shall be deemed to be given at the time the same shall be thus mailed. Any stockholder, director, or officer may waive any notice required to be given under these Bylaws. ARTICLE IX Amendments SECTION 1. Amendment of Bylaws. The Board of Directors shall have the power and authority to amend, alter or repeal these Bylaws or any provision thereof, and may from time to time make additional Bylaws. ARTICLE X Indemnification SECTION 1. Nonderivative Actions. Subject to all of the other provisions of Article X, the corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative, formal or informal (other than an action by or in the right of the corporation), by reason of the fact that the person is or was a director or officer of the Corporation, or, while serving as a director or officer of the Corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses (including actual and reasonable attorney fees), judgments, penalties, fines, and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit, or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Corporation or its shareholders, and with respect to any criminal action or proceeding, if the person had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or on a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner that the person reasonably believed to be in or not opposed to the best interests of the Corporation or its shareholders, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. SECTION 2. Derivative Actions. Subject to all of the provisions of Article X, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that the person is or was a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise, whether for profit or not, against expenses (including actual and reasonable attorney fees), and amounts paid in settlement actually and reasonably incurred by the person in connection with the action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Corporation or its shareholders. However, indemnification shall not be made for any claim, issue, or matter in which the person has been found liable to the Corporation unless and only to the extent that the court in which the action or suit was brought has determined on application that, despite the adjudication of liability but in view of all circumstances of the case, the person is fairly and reasonably entitled to indemnification for the reasonable expenses incurred. SECTION 3. Expenses of Successful Defense. To the extent that a person has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in sections 10.01 or 10.02 of these bylaws, or in defense of any claim, issue, or matter in the action, suit, or proceeding, the person shall be indemnified against actual and reasonable expenses (including attorney fees) incurred by the person in connection with the action, suit, or proceeding and any action, suit, or proceeding brought to enforce the mandatory indemnification provided by section 10.03. SECTION 4. Definition. For the purposes of section 10.01 and 10.02, "other enterprises" shall include employee benefit plans; fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and "serving at the request of a Corporation" shall include any service as a director, officer, employee, or agent of the Corporation that imposes duties on, or involves services by, the director or officer and respect to an employee benefit plan, its participants, or its beneficiaries; and a person who acted in good faith and in a manner the person reasonably believes to be in the interest of the participants and beneficiaries of an employee benefit plan shall be considered to have acted in a manner "not opposed to the best interest of the Corporation or its shareholders' as referred to in sections 10.01 and 10.02. SECTION 5. Contract Right; Limitation on Indemnity. The right to indemnification conferred in Article X shall be a contract right, and shall apply to services of a director or officer as an employee or agent of the Corporation as well as in the person's capacity as a director or officer. Except as provided in section 10.03 of these bylaws, the Corporation shall have no obligations under Article X to indemnify any person in connection with any proceeding, or part thereof, initiated by the person without authorization by the board of directors. SECTION 6. Determination that Indemnification Is Proper. Any indemnification under sections 10.01 or 10.02 of these bylaws (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case (a) when it is determined that indemnification of the person is proper in the circumstances because the person has met the applicable standard of conduct set forth in sections 10.01 or 10.02, whichever is applicable, and (b) on an evaluation of the reasonableness of expenses and amounts paid in settlement. The determination and evaluation shall be made in any of the following ways: 1. By a majority vote of quorum of the board consisting of directors who are not parties or threatened to be made parties to the action, suit, or proceeding. 2. if the quorum described in 1. above is not obtainable, then by majority vote of a committee consisting solely of two or more directors, duly designated by the board, who are not at the time parties or threatened to be made parties to the action, suit, or proceeding. 3. By independent legal counsel in a written opinion, which counsel shall be selected in of the following ways: (a) by the board or its committee in the manner prescribed in 1. or 2. above; or (b) if a quorum of the board cannot be obtained under 1. above and a committee cannot be designated under 2. above, by the board. 4. By the shareholders. However, shares held by directors, officers, employees, or agents who are parties or threatened to be made parties to the action, suit, or proceeding may not be voted. SECTION 7. Proportionate Indemnity. If a person is entitled to indemnification under sections 10.01 or 10.02 of these bylaws for a portion of expenses, including attorney fees, judgments, penalties, fines, and amounts paid in settlement; but not for the total amount, the Corporation shall indemnify the person for the portion of the expenses, judgments, penalties, fines, or amounts paid in settlement for which the person is entitled to be indemnified. SECTION 8. Expense Advance. The Corporation may pay or reimburse the reasonable expenses incurred by a person referred to in section 10.01 or 10.02 of these bylaws who is a party or threatened to be made a party to an action, suit, or proceeding in advance of final disposition of the proceeding if all of the following apply: (a) the person furnishes the Corporation in written affirmation of his good faith belief that he has met the applicable standard of conduct set forth in sections 10.01 or 10.02; (b) the person furnishes the Corporation a written undertaking executed personally, or on his behalf, to repay the advance if it is ultimately determined that he did not meet the standard of conduction; and (c) a determination is made that the facts then known to those making the determination would not preclude indemnification under sections 10.01 or 10.02. The authorization of payment must be made in the manner specified in section 10.06. The undertaking shall be an unlimited general obligation of the person on whose behalf advances are made, but it need not be secured. SECTION 9. Non-Exclusivity of Rights. The indemnification or advancement of expenses provided under this article is not exclusive of other rights to which a person seeking indemnification or advancement of expenses may be entitled under a contractual arrangement with the Corporation. However, the total amount of expenses advanced or indemnified from all sources combined shall not exceed the amount of actual expenses incurred by the person seeking indemnification or advancement of expenses. SECTION 10. Indemnification of Employees and Agents of the Corporation. The Corporation may, to the extent authorized from time to time by the board of directors, grant rights to indemnification and to the advancement of expenses to any employee or agent of the Corporation to the fullest extent of the provisions of Article X with respect to the indemnification and advancement of expenses of directors and officers of the Corporation. SECTION 11. Former Directors and Officers. The indemnification provided in Article X continues for a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors, and administrators of the person. SECTION 12. Insurance. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against the person and incurred by him in any such capacity or arising out of his status as such, whether or not the Corporation would have power to indemnify the person against the liability under these bylaws or the laws of the state of Michigan. SECTION 13. Changes in Michigan Law. If there is any change of the Michigan statutory provisions applicable to the Corporation relating to the subject matter of Article X, then the indemnification to which any person shall be entitled under this article shall be determined by the changed provisions, but only to the extent that the change permits the Corporation to provide broader indemnification rights than the provisions permitted the Corporation to provide before the change. Subject to section 10.14, the board of directors is authorized to amend these bylaws to conform to any such changed statutory provisions. EX-3.41 39 y98028exv3w41.txt CERTIFICATE OF INCORPORATION EXHIBIT 3.41 STATE OF DELAWARE SECRETARY OF STATE 991277223 - 3059230 CERTIFICATE OF INCORPORATION OF CIMCOOL INDUSTRIAL PRODUCTS INC. I, the undersigned, for the purposes of incorporating and organizing a corporation under the General Corporation Law of the State of Delaware, do execute this Certificate of Incorporation and do hereby certify as follows: FIRST. The name of the corporation is Cimcool Industrial Products Inc. SECOND. The address of the corporation's registered office in the State of Delaware is 1209 Orange Sheet, in the City of Wilmington, County of New Castle, 19801. The name of its registered agent at such address is The Corporation Trust Company. THIRD. The purpose of the corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware. FOURTH. The total number of shares of stock which the corporation shall have authority to issue is 1,000. All such shares are to be Common Stock, par value of $1.00 per share, and are to be of one class. FIFTH. The incorporator of the corporation is RL&F Service Corp., whose mailing address is One Rodney Square, 10th Floor, Tenth and King Streets, Wilmington DE 19801. SIXTH. Unless and except to the extent that the by-laws of the corporation shall so require, the election of directors of the corporation need not be by written ballot. SEVENTH. In furtherance and not to limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors of the corporation is expressly authorized to make, alter and repeal the by-laws of the corporation, subject to the power of the stockholders of the corporation to alter or repeal any by-law whether adopted by them or otherwise. EIGHTH. A director of the corporation shall not be liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the General Corporation Law of the State of Delaware as the same exists or may hereafter be amended. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of the corporation hereunder in respect -1- of any act or omission occurring prior to the time of such amendment, modification or repeal. NINTH. The corporation reserves the right at any time, and from time to time, to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, and other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted, in the manner now or hereafter prescribed by law; and all rights, preferences and privileges of whatsoever nature conferred upon stockholders, directors or any other persons whomsoever by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended are granted subject to the rights reserved in this article. TENTH. The powers of the incorporator are to terminate upon the filing of this Certificate of Incorporation with the Secretary of State of the State of Delaware. The names and mailing addresses of the persons who are to serve as the initial directors of the corporation until the first annual meeting of stockholders of the corporation, or until their successors are duly elected and qualified, are: Daniel. Meyer 2090 Florence Avenue Cincinnati, OH 45206 Alan L. Shaffer 2090 Florence Avenue Cincinnati, OH 45206 Ronald D. Brown 2090 Florence Avenue Cincinnati, OH 45206 The undersigned incorporator hereby acknowledges that the foregoing certificate of incorporation is his act and deed on this the 7th day of July 1999. RL&F SERVICE CORP. By: /s/ C. Stephen Bigler --------------------------------- C. Stephen Bigler President -2- EX-3.42 40 y98028exv3w42.txt BYLAWS EXHIBIT 3.42 BY-LAWS OF CIMCOOL INDUSTRIAL PRODUCTS INC. ARTICLE I Meetings of Stockholders Section 1.1. Annual Meetings. An annual meeting of stockholders shall be held for the election of directors at such date, time and place, either within or without the State of Delaware, as may be designated by resolution of the Board of Directors from time to time. Any other proper business may be transacted at the annual meeting. Section 1.2. Special Meetings. Special meetings of stockholders for any purpose or purposes may be called at any time by the Board of Directors, but such special meetings may not be called by any other person or persons. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice. Section 1.3. Notice of Meetings. Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given that shall state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise provided by law, the certificate of incorporation or these by-laws, the written notice of any meeting shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Section 1.4. Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. Section 1.5. Quorum. Except as otherwise provided by law, the certificate of incorporation or these by-laws, at each meeting of stockholders the presence in person or by proxy of the holders of a majority in voting power of the outstanding shares of stock entitled to vote at the meeting shall be necessary and sufficient to constitute a quorum. In the absence of a quorum, the stockholders so present may, by a majority in voting power thereof, adjourn the meeting from time to time in the manner provided in Section 1.4 of these by-laws until a quorum shall attend. Shares of its own stock belonging to the corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the corporation, shall neither be entitled to vote nor be counted for quorum purposes; provided, however, that the foregoing shall not limit the right of the corporation or any subsidiary of the corporation to vote stock, including but not limited to its own stock, held by it in a fiduciary capacity. Section 1.6. Organization. Meetings of stockholders shall be presided over by the Chairman of the Board, if any, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in his absence by a Vice President, or in the absence of the foregoing persons by a chairman designated by the Board of Directors, or in the absence of such designation by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting; may appoint any person to act as secretary of the meeting. Section 1.7. Voting: Proxies. Except as otherwise provided by or pursuant to the provisions of the certificate of incorporation, each stockholder entitled to vote at any meeting of stockholders shall be entitled to one vote for each share of stock held by such stockholder which has voting power upon the matter in question. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or by delivering a proxy in accordance with applicable law bearing a later date to the Secretary of the corporation. Voting at meetings of stockholders need not be by written ballot. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect. All other elections and questions shall, unless otherwise provided by the certificate of incorporation, these by-laws, the rules or regulations of any stock exchange applicable to the corporation, as otherwise provided by law or pursuant to any regulation applicable to the corporation, be decided by the affirmative vote of the holders of a majority in voting power of the shares of stock of the corporation which are present in person or by proxy and entitled to vote thereon. -2- Section 1.8. Fixing Date for Determination of Stockholders of Record. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date: (1) in the case of determination of stockholders entitled to vote at any meeting of stockholders or adjournment thereof, shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting; (2) in the case of determination of stockholders entitled to express consent to corporate action in writing without a meeting, shall not be more than ten (10) days from the date upon which the resolution fixing the record date is adopted by the Board of Directors; and (3) in the case of any other action, shall not be more than sixty (60) days prior to such other action. If no record date is fixed: (1) the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; (2) the record date for determining stockholders entitled to express consent to corporate action in writing without a meeting, when no prior action of the Board of Directors is required by law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation in accordance with applicable law, or, if prior action by the Board of Directors is required by law, shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action; and (3) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Section 1.9. List of Stockholders Entitled to Vote. The Secretary shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present. Upon the willful neglect or refusal of the directors to produce such a list at any meeting for the election of directors, they shall be ineligible for election to -3- any office at such meeting. Except as otherwise provided by law, the stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list of stockholders or the books of the corporation, or to vote in person or by proxy at any meeting of stockholders. Section 1.10. Action By Written Consent of Stockholders. Unless otherwise restricted by the certificate of incorporation, any action required or permitted to be taken at any annual or special meeting of the stockholders may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the corporation having custody of the book in which minutes of proceedings of stockholders are recorded. Delivery made to the corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall, to the extent required by law, be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of holders to take the action were delivered to the corporation. Section 1.11. Inspectors of Election. The corporation may, and shall if required by law, in advance of any meeting of stockholders, appoint one or more inspectors of election, who may be employees of the corporation, to act at the meeting or any adjournment thereof and to make a written report thereof. The corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. In the event that no inspector so appointed or designated is able to act at a meeting of stockholders, the person presiding at the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath to execute faithfully the duties of inspector with strict impartiality and according to the best of his or her ability. The inspector or inspectors so appointed or designated shall (i) ascertain the number of shares of capital stock of the corporation outstanding and the voting power of each such share, (ii) determine the shares of capital stock of the corporation represented at the meeting and the validity of proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, and (v) certify their determination of the number of shares of capital stock of the corporation represented at the meeting and such inspectors' count of all votes and ballots. Such certification and report shall specify such other information as may be required by law. In determining the validity and counting of proxies and ballots cast at any meeting of stockholders of the corporation, the inspectors may consider such information as is -4- permitted by applicable law. No person who is a candidate for an office at an election may serve as an inspector at such election. Section 1.12. Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of any meeting of stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the chairman of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to stockholders of record of the corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. Unless and to the extent determined by the Board of Directors or the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure. -5- ARTICLE II Board of Directors Section 2.1. Number; Qualifications. The Board of Directors shall consist of one or more members, the number thereof to be determined from time to time by resolution of the Board of Directors. Directors need not be stockholders. Section 2.2. Election; Resignation; Vacancies. The Board of Directors shall initially consist of the persons named as directors in the certificate of incorporation or elected by the incorporator of the corporation, and each director so elected shall hold office until the first annual meeting of stockholders or until his successor is duty elected and qualified. At the first annual meeting of stockholders and at each annual meeting thereafter, the stockholders shall elect directors each of whom shall hold office for a term of one year or until his successor is duly elected and qualified, subject to such director's earlier death, resignation, disqualification or removal. Any director may resign at any time upon written notice to the corporation. Unless otherwise provided by law or the certificate of incorporation, any newly created directorship or any vacancy occurring in the Board of Directors for any cause may be filled by a majority of the remaining members of the Board of Directors, although such majority is less than a quorum, or by a plurality of the votes cast at a meeting of stockholders, and each director so elected shall hold office until the expiration of the term of office of the director whom he has replaced or until his successor is elected and qualified. Section 2.3. Regular Meetings. Regular meetings of the Board of Directors may be held at such places within or without the State of Delaware and at such times as the Board of Directors may from time to time determine. Section 2.4. Special Meetings. Special meetings of the Board of Directors may be held at any time or place within or without the State of Delaware whenever called by the President, any Vice President, the Secretary, or by any member of the Board of Directors. Notice of a special meeting of the Board of Directors shall be given by the person or persons calling the meeting at least twenty-four hours before the special meeting. Section 2.5. Telephonic Meetings Permitted. Members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting thereof by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this by-law shall constitute presence in person at such meeting. Section 2.6. Quorum; Vote Required for Action. At all meetings of the Board of Directors a majority of the whole Board of Directors shall constitute a quorum for -6- the transaction of business. Except in cases in which the certificate of incorporation, these by-laws or applicable law otherwise provides, the vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Section 2.7. Organization. Meetings of the Board of Directors shall be presided over by the Chairman of the Board, if any, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in their absence by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary, of the meeting. Section 2.8. Action by Written Consent of Directors. Unless otherwise restricted by the certificate of incorporation or these by-laws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or such committee. -7- ARTICLE III Committees Section 3.1. Committees. The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of the committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in place of any such absent or disqualified member. Any such committee, to the extent permitted by law and to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it. Section 3.2. Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board of Directors may make, alter and repeal rules for the conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board of Directors conducts its business pursuant to Article II of these by-laws. -8- ARTICLE IV Officers Section 4.1. Executive Officers; Election; Qualifications; Term of Office: Resignation; Removal; Vacancies. The Board of Directors shall elect a President and Secretary, and it may, if it so determines, choose a Chairman of the Board and a Vice Chairman of the Board from among its members. The Board of Directors may also choose one or more Vice Presidents, one or more Assistant Secretaries, a Treasurer and one or more Assistant Treasurers. Each such officer shall hold office until the first meeting of the Board of Directors after the annual meeting of stockholders next succeeding his election, and until his successor is elected and qualified or until his earlier resignation or removal. Any officer may resign at any time upon written notice to the corporation. The Board of Directors may remove any officer with or without cause at any time, but such removal shall be without prejudice to the contractual rights of such officer, if any, with the corporation. Any number of offices may be held by the same person. Any vacancy occurring in any office of the corporation by death, resignation, removal or otherwise may be filled for the unexpired portion of the term by the Board of Directors at any regular or special meeting. Section 4.2. Powers and Duties of Executive Officers. The officers of the corporation shall have such powers and duties in the management of the corporation as may be prescribed in a resolution by the Board of Directors and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors. The Board of Directors may require any officer, agent or employee to give security for the faithful performance of his duties. -9- ARTICLE V Stock Section 5.1. Certificates. Every holder of stock shall be entitled to have a certificate signed by or in the name of the corporation by the Chairman or Vice Chairman of the Board of Directors, if any, or the President or a Vice President, and by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary, of the corporation certifying the number of shares owned by him in the corporation. Any of or all the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue. Section 5.2. Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates. The corporation may issue a new certificate of stock in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen or destroyed certificate, or his legal representative, to give the corporation a bond sufficient to indemnify it against; any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. -10- ARTICLE VI Indemnification Section 6.1. Right to Indemnification. The corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person (an "Indemnitee") who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "proceeding"), by reason of the fact that he, or a person for whom he is the legal representative, is or was a director or officer of the corporation or, while a director or officer of the corporation, is or was serving at the written request of the corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such Indemnitee. Notwithstanding the preceding sentence, except as otherwise provided in Section 6.3, the corporation shall be required to indemnify an Indemnitee in connection with a proceeding (or part thereof) commenced by such Indemnitee only if the commencement of such proceeding (or part thereof) by the Indemnitee was authorized by the Board of Directors. Section 6.2. Prepayment of Expenses. The corporation shall pay the expenses (including attorneys' fees) incurred by an Indemnitee in defending any proceeding in advance of its final disposition, provided, however, that, to the extent required by law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by the Indemnitee to repay all amounts advanced if it should be ultimately determined that the Indemnitee is not entitled to be indemnified under this Article VI or otherwise. Section 6.3. Claims. If a claim for indemnification or advancement of expenses under this Article VI is not paid in full within sixty (60) days after a written claim therefor by the Indemnitee has been received by the corporation, the Indemnitee may file suit to recover the unpaid amount of such claim and, if successful in whole or in part shall be entitled to be paid the expense of prosecuting such claim. In any, such action the corporation shall have the burden of proving that the Indemnitee is not entitled to the requested indemnification or advancement of expenses under applicable law. Section 6.4. Nonexclusivity of Rights. The rights conferred on any Indemnitee by this Article VI shall not be exclusive of any other rights which such Indemnitee may have or hereafter acquire under any statute, provision of the certificate of incorporation, these by-laws, agreement, vote of stockholders or disinterested directors or otherwise. -11- Section 6.5. Other Sources. The corporation's obligation, if any, to indemnify or to advance expenses to any Indemnitee who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such Indemnitee may collect as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, enterprise or non-profit enterprise. Section 6.6. Amendment or Repeal. Any repeal or modification of the foregoing provisions of this Article VI shall not adversely affect any right or protection hereunder of any Indemnitee in respect of any act or omission occurring prior to the time of such repeal or modification. Section 6.7. Other Indemnification and Prepayment of Expenses. This Article VI shall not limit the right of the corporation, to the extent and in the manner permitted by law, to indemnify and to advance expenses to persons other than Indemnitees when and as authorized by appropriate corporate action. -12- ARTICLE VII Miscellaneous Section 7.1. Fiscal Year. The fiscal year of the corporation shall be determined by resolution of the Board of Directors. Section 7.2. Seal. The corporate seal shall have the name of the corporation inscribed thereon and shall be in such form as may be approved from time to time by the Board of Directors. Section 7.3. Manner of Notice. Except as otherwise provided herein, notices to directors and stockholders shall be in writing and delivered personally or mailed to the directors or stockholders at their addresses appearing on the books of the corporation. Notice to directors may be given by telegram, telecopier, telephone or other means of electronic transmission. Section 7.4. Waiver of Notice of Meetings of Stockholders, Directors and Committees. Any written waiver of notice, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at nor the purpose of any regular or special meeting of the stockholders, directors, or members of a committee of directors need be specified in any written waiver of notice. Section 7.5. Form of Records. Any records maintained by the corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or be in the form of, punch cards, magnetic tape, photographs, microphotographs, or any other information storage device, provided that the records so kept can be converted into clearly legible form within a reasonable time. Section 7.6. Amendment of By-Laws. These by-laws may be altered, amended or repealed, and new by-laws made, by the Board of Directors, but the stockholders may make additional by-laws and may alter and repeal any by-laws whether adopted by them or otherwise. -13- EX-3.43 41 y98028exv3w43.txt ARTICLES OF INCORPORATION 1. EXHIBIT 3.43 Ontario Corporation Number Numero de la societe en Ontario 1214935 For Ministry Use Only A l'usage exclusif du ministere Ministere da la Consommation [LOGO] et du Commerce CERTIFICAT Consumer and Ceci certifie que les presents Ontario Commercial Relations statuts entrent en vigueur le CERTIFICATE This is to certify that these articles are effective on DECEMBER 19 DECEMBRE, 1996 /s/ [ILLEGIBLE] Director/Directeur Business Corporations Act/Loi sur les societes par actions ARTICLES OF INCORPORATION STATUTS CONSTITUTIFS Form 1 Business Corporations Act 1. The name of the corporation is: Denomination sociale de la societe: CINCINNATI MILACRON CANADA INC. Formule 1 Loi sur les societes par actions 2. The address of the registered office: Addresse du siege social: 181 Bay Street, Suite 2100 --------------------------------------------------------------------------- (Street & Number, or R.R. Number & if Multi-Office Building give Room No.) (Rue et numero, ou numero de la R.R. et, s'il s'agit d'un edifice a bureaux, numero du bureau) Toronto, Ontario. [M 5 J 2 T 3] --------------------------------------------------------------------------- (Name of Municipality or post office) (Postal Code) (Nom de la municipalite ou du bureau de poste) (Code Postal) 3. Number (or minimum Nombre (ou nombres and maximum number) minimal et maximal) of directors is: d'administrateurs: Minimum of one (1), maximum of ten (10) 4. The first director(s) is/ are Premier(s) administrateur(s): Resident Canadian First name, Initials and surname Residence address, giving Street & No., or State Prenom, initiales et nom de famille R.R. No., Municipality and Postal Code Yes or No Addresse personnelle, y compris la rue et Resident le numero, le numero de la R.R., le nom canadien de la municipalite et le code postal Oui/Non - ----------------------------------------------------------------------------------------------------- Edward J. Kowal 1276 Greenoaks Drive Yes Mississauga, Ontario. L5J 3A5

2. 5. Restrictions, if any, on business the corporation may carry on or on powers the corporation may exercise. Limites, s'll y a lieu, imposees aux activities commerciales ou aux pouvoirs de la socials. No restrictions. 6. The classes and any maximum number of shares that the corporation is authorized to issue: Categories et nombre maximal, s'il y a lieu, d'actions [ILLEGIBLE] la societe est autorisee a emettre: An unlimited number of common shares. 3. 7. Rights, privileges, restrictions and conditions (if any) attaching to each class of shares and directors authority with respect to any class of shares which may be issued in series: Droits, privileges, restrictions at conditions, s'll y a lieu, attaches a cheque categorie d'actions et pouvoirs des administrateurs relatifs a chaque categorie d'actions qul peut etre emise en serie: Common Shares 1. The holders of the common shares shall be entitled to receive, as and when declared by the board of directors of the Corporation, out of monies properly applicable to the payment of dividends, dividends on the common shares at any time outstanding which the directors may determine to declare and pay in any fiscal year of the Corporation. 2. In the event of the liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the holders of the common shares shall be entitled to receive the remaining property and assets of the Corporation. 3. At all meetings of the shareholders, the holders of the common shares of the Corporation shall be entitled to one (1) vote for each common share held by them. 4. Any amendment to the articles of the Corporation to delete or vary any right, privilege, restriction or condition attaching to the common shares or to create shares ranking in priority to or on a parity with the common shares, in addition to the authorization by special resolution, shall be authorized by at least two-thirds (2/3) of the votes cast at a meeting of the holders of the common shares duly called for that purpose. 4. 8. The issue, transfer or ownership L'emission, le transfert du la of shares is/is not restricted and propriete d'actions est/n'est pas the restrictions (if any) are as restreinte. Les restrictions, s'il follows: y a lieu, sont les suivantes:

No Shares shall be sold, transferred or otherwise disposed of without the approval of: (a) the directors of the Corporation, expressed by a resolution of the board of directors; or (b) the shareholders of the Corporation, expressed by a resolution of the shareholders. 5. ~~9. Other provisions, if any, are: Autres dispositions, s'il y a lieu:~~

1. The number of shareholders of the Corporation, exclusive of persons who are in its employment and exclusive of persons who, having been formerly in the employment of the Corporation, were, while in that employment and have continued after the termination of that employment to be, shareholders of the Corporation, is limited to not more than fifty, two or more persons who are the joint registered owners of one or more shares being counted as a single shareholder. 2. Any invitation to the public to subscribe for securities of the Corporation is prohibited. 3. The directors of the Corporation may, without authorization of the shareholders: (a) borrow money upon the credit of the Corporation; (b) issue, reissue, sell or pledge debt obligations of the Corporation; (c) subject to Section 20 of the Business Corporations Act, R.S.O. 1990, c.B.16, (the "Act"), give a guarantee on behalf of the Corporation to secure performance of an obligation of any person; and (d) mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the Corporation, owned or subsequently acquired, to secure any debt obligation of the Corporation. The words "debt obligation" and "security interest" as used in this paragraph shall have the meanings provided in subsection 1(1) of the Act. 4. The directors of the Corporation may, by resolution, delegate any or all of the powers referred to in the foregoing paragraph 3 to a director, a committee of directors or an officer. 6. 10. The names and addresses of the incorporators are Nom et adresse des fondateurs First name, initials and surname or corporate name Full residence address or address of Prenom, initial et nom de famille ou denomination registered office or of principal place of sociale business giving street & No. or R.R. No., municipality and postal code Adresse personnelle au complet, adresse du siege social ou adresse de l'establissement principal, y compris la rue et le numero, le numero de la R.R., le nom de la municipalite et le code postal Edward J. Kowal 1276 Greenoaks Drive, Mississauga, Ontario. L5J 3A5

These articles are signed in duplicate. Les presents statuts sont signes en double exemplaire. Signature of incorporators (signatures des fondateurs) /s/ Edward J. Kowal ----------------------------- Edward J. Kowal 1. For Ministry Use Only Ontario Corporation Number A l'usage exclusif du ministere Numero de la societe en Ontario [LOGO] Ministry of Ministere de 1214935 Consumer and la Consommation Commercial et du Commerce Relations CERTIFICATE CERTIFICAT This is to certify that these Ceci certifie que les presents articles are effective on statuts entrent en vigueur le OCTOBER 01 OCTOBRE, 1998 /s/ [ILLEGIBLE] Director/Directeur Business Corporations Act/ Loi sur les societes par actions ARTICLES OF AMENDMENT STATUTS DE MODIFICATION Form 3 Business Corporations Act 1. The name of the corporation is: Denomination sociale de la societe: CINCINNATI MILACRON CANADA INC. Formule 3 Loi sur les societes par actions 2. The name of the corporation is (Nouvelle denomination sociale de changed to (if applicable): la societe (s'il y a lieu): MILACRON CANADA INC. 3. Date of Incorporation/amalgamation: Date de la constitution ou de la fusion: 1996/DECEMBER/19 - -------------------------------------------------------------------------------- (Year, Month, Day) (annee, mois, jour) 4. The articles of the corporation are Les statuts de la societe sont amended as follows: modifies de la facon suivante. To change the name of the Corporation from CINCINATI MILACRON CANADA INC. to MILACRON CANADA INC. DYE & DURHAM Corporation From-on-Click CBR 173 2. Form 3 Business Corporations Act Formule 3 Loi sur les societes par actions 5. The amendment has been duly La modification a ete dument authorized as required by autorisee conformement aux Sections 168 & 170 (as applicable) articles 168 et 170 (selon le of the Business Corporations Act. cas) de la Loi sur les societes par actions. 6. The resolution authorizing the Les actionnaires ou les amendment was approved by the administrateurs (selon le cas) shareholders/directors de la societe ont approuve la (as applicable) of the resolution autorisant la corporation on modification le 1998/SEPTEMBER/28 - -------------------------------------------------------------------------------- (Year, Month, Day) (annee, mois, jour) These articles are signed in duplicate. Les presents status sont signes en double exemplaire. CINCINNATI MILACRON CANADA INC. ---------------------------------------- (Name of Corporation) (Denomination sociale de la societe) Ronald L. Smith- By:/Par /s/ Ronald L. Smith PRESIDENT ---------------------------------------- (Signature) (Description of Office) (Signature) (Fonction) Dye & Durham Corporation Forms -On-Disk CBR 173 EX-3.44 42 y98028exv3w44.txt BYLAWS EXHIBIT 3.44 BY-LAW NO. 1 A by-law relating generally to the transaction of the business and affairs of CINCINNATI MILACRON CANADA INC. (hereinafter called the "Corporation") CONTENTS
Section Page - ------- ---- One Interpretation 1 Two Directors 2 Three Officers 6 Four Protection of Directors, Officers and Others 8 Five Shares 9 Six Meetings of Shareholders 11 Seven Dividends and Rights 15 Eight Notices 15 Nine Execution of Documents 17 Ten Fiscal Year, Registered Office 18 Eleven Unanimous Shareholder Agreement 18 Twelve Effective Date 19
BE IT ENACTED as a by-law of the Corporation as follows: SECTION ONE INTERPRETATION 1.01 DEFINITIONS: In this by-law, unless the context otherwise requires: (i) words importing the singular include the plural and vice versa, words importing gender include the masculine, feminine and neuter genders; and words importing persons shall include bodies - 2 - corporate and politic, partnerships, sole proprietorships, unincorporated associations, trusts, syndicates and any number or aggregate of persons and the heirs, executors, administrators, successors and assigns of such persons; (ii) "Act" means the Business Corporations Act, R.S.O. 1990, c. B.16, including amendments made thereto from time to time, and includes the regulations made pursuant thereto, including amendments made thereto from time to time, and every statute or regulation that may be substituted therefor; (iii) "articles" means the articles of incorporation of the Corporation under the Act as amended or restated from time to time; (iv) "board" means the board of directors of the Corporation; (v) "by-law" means any by-law of the Corporation as from time to time in force and effect; (vi) "unanimous shareholder agreement" means a written agreement among all the shareholders of the Corporation or a written declaration of the beneficial holder of all of the issued shares of the Corporation that restricts in whole or in part the power of the directors to manage or supervise the management of the business and affairs of the Corporation; (vii) All terms contained in the by-laws which are defined in the Act shall have the meanings given to such terms in the Act save as specifically provided herein to the contrary. SECTION 2 DIRECTORS 2.01 POWERS: Subject to any unanimous shareholder agreement, the management of the business and affairs of the Corporation shall be managed or supervised by the board. The board may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation and are not by the Act, the by-laws, a unanimous shareholder agreement, any special resolution of the Corporation or by statute expressly directed or required to be done in some other manner. 2.02 NUMBER: The number of directors is as stipulated in the articles or, if the articles provide for a minimum and a maximum number of directors, as set by special resolution or resolution of the directors passed pursuant to subsection 125(3) of the Act. - 3 - 2.03 QUORUM: Subject to subsection 126(4) of the Act and to the articles, the quorum for the transaction of business at any meeting of the board shall consist of a majority of the number of directors as stipulated in the articles, or if the articles provide for a minimum and a maximum number of directors, a majority of the number of directors as set by special resolution or resolution of the directors passed pursuant to subsection 125(3) of the Act, or, if the number of directors has not been determined, then a majority of the minimum number of directors required by the articles, but in no case shall a quorum be less than two-fifths of the number of directors or minimum number of directors, as the case may be. 2.04 QUALIFICATIONS: No person shall be qualified for election as a director or to be a director if he is less than eighteen years of age; if he is of unsound mind and has been so found by a court in Canada or elsewhere; if he is not an individual; or if he has the status of a bankrupt. Unless the articles otherwise provide, a director need not be a shareholder. A majority of the directors shall be resident Canadians provided that if the number of directors is two, at least one shall be a resident Canadian. 2.05 ELECTION AND TERM: Subject to subsection 120(a) of the Act, the election of directors shall take place at the first meeting of shareholders and at each succeeding annual meeting at which an election of directors is required. The directors shall hold office for a term expiring not later than the close of the third annual meeting of shareholders following the election. A director not elected for an expressly stated term ceases to hold office at the close of the first annual meeting of shareholders following his election. Incumbent directors, if qualified, shall be eligible for re-election. If an election of directors is not held at the proper time the directors shall continue in office until their successors are elected. 2.06 REMOVAL OF DIRECTORS: Subject to the provisions of the Act, the shareholders may, by ordinary resolution passed at an annual or special meeting, remove any director from office and the vacancy created by such removal may be filled at the same meeting, failing which it may be filled by the directors. 2.07 RESIGNATION: A director who is not named in the articles may resign from office upon giving a written resignation to the Corporation and such resignation becomes effective when received by the Corporation or at the time specified in the resignation, whichever is later. A director named in the articles shall not be permitted to resign his office unless, at the time the resignation is to become effective, a successor is elected or appointed. 2.08 VACATION OF OFFICE: A director ceases to hold office when he dies; he is removed from office by the shareholders; he ceases to be qualified; or his written resignation is received by the Corporation, or if a time is specified in such resignation, at the time so specified, whichever is later. - 4 - 2.09 VACANCIES: Subject to subsections 124(1),(2),(4) and (5) of the Act and to the articles, a quorum of the board may fill a vacancy in the board, except a vacancy resulting from an increase in the number of directors or in the maximum number of directors or from a failure of the shareholders to elect the number of directors required to be elected. In the absence of a quorum of the board, or if the vacancy has arisen from a failure of the shareholders to elect the requisite number of directors, the board shall forthwith call a special meeting of shareholders to fill the vacancy. If the board fails to call such meeting or if there are no such directors then in office, any shareholder may call the meeting. 2.10 CANADIAN MAJORITY: The board shall not transact business at a meeting, other than filling a vacancy in the board, unless a majority of the directors, or, where the Corporation has only one or two directors, that director or one of the two directors, as the case may be, are resident Canadians, except where: (a) a resident Canadian director who is unable to be present approves in writing or by telephone or other communications facilities the business transacted at the meeting; and (b) a majority of resident Canadians would have been present had that director been present at the meeting. 2.11 MEETINGS BY TELEPHONE: If all the directors consent, a director or all of the directors may participate in a meeting of the board or of a committee of the board by means of such telephone, electronic or other communications facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and any director participating in such a meeting by such means is deemed to be present at the meeting. Any such consent shall be effective whether given before or after the meeting to which it relates and may be given with respect to all meetings of the board and of committees of the board held while a director holds office. For the purpose hereof, participation in a meeting by such means shall be deemed to be such consent. If a majority of the directors participating in such a meeting are then in Canada the meeting shall be deemed to have been held in Canada. 2.12 PLACE OF MEETINGS: Meetings of the board and of any committees of the board may be held at any place within or outside Ontario. In any financial year of the Corporation a majority of the meetings of the board need not be held within Canada. 2.13 CALLING OF MEETINGS: Meetings of the board shall be held from time to time at such place as the Chairman of the Board, the President or a majority of the directors may determine. A meeting of the board may be convened by the Chairman of the Board, the President or any one director at any time and the Secretary shall, upon direction from any of the foregoing, convene a meeting of the board. - 5 - 2.14 NOTICE OF MEETING: Notice of the time and place of each meeting of the board shall be given in the manner provided in section 8.01 to each director not less than forty-eight hours before the time when the meeting is to be held. A notice of a meeting of directors need not specify the purpose of or the business to be transacted at the meeting except where the Act requires such purpose or business to be specified. A director may in any manner and at any time waive notice of or otherwise consent to a meeting of the board and attendance of a director at a meeting of directors is a waiver of notice of the meeting except where a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called. 2.15 ADJOURNMENT: Any meeting of the board of directors or of a committee of the board of directors (if any) may be adjourned from time to time by the chairman of the meeting, with the consent of the meeting, to a fixed time and place and no notice of the time and place for the holding of the adjourned meeting need be given to any director if such time and place is announced at the original meeting. Any adjourned meeting shall be duly constituted if held in accordance with the terms of the adjournment and a quorum is present thereat, provided that the directors who formed a quorum at the original meeting are not required to form the quorum at the adjourned meeting. If there is no quorum at the adjourned meeting, the original meeting shall be deemed to have terminated forthwith after its adjournment. 2.16 CHAIRMAN: The Chairman of any meeting of the board shall be the first mentioned of such of the following officers as have been appointed and who is a director and is present at the meeting: Chairman of the Board, President, or a Vice-President who is a director. If no such officer is present, the directors present shall choose one of their number to be chairman. 2.17 VOTES TO GOVERN: A majority of directors shall constitute a quorum for the transaction of business. At all meetings of the board of directors every question shall be decided by a majority of the votes cast on the question. In case of an equality of votes the chairman of the meeting shall be entitled to a second or casting vote. 2.18 CONFLICT OF INTEREST: A director or officer who is a party to, or who is a director or officer of or has a material interest in any person who is a party to, a material contract or proposed material contract or transaction with the Corporation shall disclose the nature and extent of his interest at the time and in the manner provided by the Act. Any such contract or proposed contract shall be referred to the board or shareholders for approval even if such contract is one that in the ordinary course of the Corporation's business would not require approval by the board or shareholders, and a director interested in a contract so referred to the board shall not vote on any resolution to approve the same except as provided by the Act. - 6 - 2.19 REMUNERATION AND EXPENSES: Subject to the articles or any unanimous shareholder agreement, the directors shall be paid such remuneration for their services as the board may from time to time determine. The directors shall also be entitled to be reimbursed for travelling and other expenses properly incurred by them in attending meetings of the board or any committee thereof. Nothing herein contained shall preclude any director from serving the Corporation in any other capacity and receiving remuneration therefor. 2.20 RESOLUTION IN LIEU OF MEETING: A resolution in writing, signed by all the directors entitled to vote on that resolution at a meeting of directors or committee of directors, is as valid as if it had been passed at a meeting of directors or committee of directors. A copy of every such resolution shall be kept with the minutes of the proceedings of the directors or committee of directors. 2.21 DESIGNATION: Directors may appoint from their number a Managing Director who is a resident Canadian or a committee of directors and delegate to such Managing Director or committee any of the powers of the directors except those which, under the Act, a Managing Director or committee of directors has no authority to exercise. If the directors appoint a committee of directors, a majority of the members of the committee must be resident Canadians. Unless otherwise determined by the board, each committee shall have the power to fix its quorum at not less than a majority of its members, to elect its chairman and to regulate its procedure. Meetings of any committee may take place within or outside Ontario. 2.22 SUBMISSION FOR APPROVAL: The directors in their discretion may submit any contract, act or transaction for approval, ratification or confirmation at any meeting of the shareholders called for the purpose of considering the same and any contract, act or transaction that shall be approved, ratified or confirmed by resolution passed by a majority of the votes cast at any such meeting (unless any different or additional requirement is imposed by the Act or by the Corporation's articles or by-laws) shall be as valid and as binding upon the Corporation and upon all the shareholders as though it had been approved, ratified and/or confirmed by every shareholder of the Corporation. 2.23 VALIDITY OF ACTS: An act done by a director or by an officer is not invalid by reason only of any defect that is thereafter discovered in his appointment, election or qualification. SECTION THREE OFFICERS 3.01 APPOINTMENT: Subject to the articles and to any unanimous shareholder agreement, the board may from time to time appoint a Chairman of the Board, a President, one or more Vice-Presidents (to which title may be added words indicating - 7 - seniority or function), a Secretary, a Treasurer and such other officers as the board may determine, including one or more assistants to any of the officers so appointed. The board may specify the duties of and, in accordance with this by-law and subject to the provisions of the Act, delegate to such officers powers to manage the business and affairs of the Corporation. None of the officers, except the Chairman of the Board, if any, need be a director of the Corporation. Two or more offices of the Corporation may be held by the same person. 3.02 CHAIRMAN OF THE BOARD OF DIRECTORS: The Chairman of the Board of directors (if any) shall, when present, preside at all meetings of the directors and shareholders and of any committee of directors; he shall sign such contracts, documents or instruments in writing as may require his signature in accordance with the by-laws and shall have such other powers and duties as may from time to time be assigned to him by the board of directors or as are incident to his office. 3.03 PRESIDENT: If appointed, the President shall be the chief executive officer of the Corporation and, subject to the authority of the board, shall exercise general supervision of the business and affairs of the Corporation; and he shall have such other powers and duties as the board may specify. In the absence of the Chairman of the Board, if any, the President shall, when present, chair all meetings of the directors and the shareholders and of any committee of directors. 3.04 VICE-PRESIDENT: If appointed, a Vice-President shall have such powers and duties as the board or the chief executive officer may specify. In the absence or disability or refusal to act of the President, a Vice-President may be vested with all the powers and may perform all the duties of the President. 3.05 SECRETARY: The Secretary shall attend and be the Secretary of all meetings of the board, shareholders and committees of the board and shall enter or cause to be entered in records kept for that purpose minutes of all proceedings thereat; he shall give or cause to be given, as and when instructed, all notices to shareholders, directors, officers, auditors and members of committees of the board; he shall be the custodian of all books, papers, records, documents and instruments belonging to the Corporation, except when some other officer or agent has been appointed for that purpose; and he shall have such other powers and duties as the board may specify. 3.06 TREASURER: The Treasurer shall keep or cause to be kept proper accounting records in compliance with the Act and shall be responsible for the deposit of money, the safekeeping of securities and the disbursement of the funds of the Corporation; he shall render to the board whenever required an account of all his transactions as Treasurer and of the financial position of the Corporation; and he shall have such other powers and duties as the board may specify or as are incident to his office. 3.07 POWERS AND DUTIES OF OTHER OFFICERS: The powers and duties of all other officers shall be such as the terms of their engagement call for or as the board or the - 8 - chief executive officer may specify. Any of the powers and duties of an officer to whom an assistant has been appointed may be exercised and performed by such assistant, unless the board otherwise directs. 3.08 VARIATION OF POWERS AND DUTIES: The board may from time to time and subject to the provisions of the Act, vary, add to or limit the powers and duties of any officer. 3.09 TERM OF OFFICE: The board, in its discretion, may remove any officer of the Corporation. An officer may resign from office upon giving a written resignation to the Corporation and such resignation becomes effective when received by the Corporation or at such time specified in the resignation, whichever is later. Otherwise, each officer appointed by the board shall hold office until his successor is appointed. The fact that any officer or employee is a director or shareholder of the Corporation shall not disqualify him from receiving such remuneration as may be determined in respect of his office or employment. SECTION FOUR PROTECTION OF DIRECTORS, OFFICERS AND OTHERS 4.01 LIMITATION OF LIABILITY: No director or officer for the time being of the Corporation, shall be liable for the acts, receipts, neglects or defaults of any other director or officer or employee, or for joining in any receipt or other act for conformity, or for any loss, damage or expense happening to the Corporation through the insufficiency or deficiency of title to any property acquired for or on behalf of the Corporation, or for the insufficiency or deficiency of any security in or upon which any of the moneys of the Corporation shall be invested, or for any loss or damage arising from the bankruptcy, insolvency or tortious acts of any person with whom any of the moneys, securities or effects of the Corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his part, or for any other loss, damage or misfortune whatever which shall happen in the execution of the duties of his office or in relation thereto, unless the same are occasioned through his failure to exercise the powers and to discharge the duties of his office honestly, in good faith and in the best interests of the Corporation, and in connection therewith, to exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances; provided that nothing herein shall relieve any director or officer from the duty to act in accordance with the Act and the regulations thereunder or from liability for any breach thereof. 4.02 INDEMNITY: Subject to the limitations contained in the Act, the Corporation shall indemnify a director or officer, a former director or officer of the Corporation, or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor and his heirs or legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any - 9 - civil, criminal or administrative action or proceeding that is proposed or commenced against him or to which he is made a party by reason of being or having been a director or officer of the Corporation or such body corporate, if: (a) he acted honestly and in good faith with a view to the best interests of the Corporation; and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful. The Corporation is hereby authorized to execute agreements evidencing its indemnities in favour of the foregoing persons to the full extent permitted by law. 4.03 INSURANCE: Subject to the limitations contained in the Act, the Corporation may purchase and maintain such insurance for the benefit of its directors and officers as such, as the board may from time to time determine. SECTION FIVE SHARES 5.01 ALLOTMENT: The board may from time to time allot or grant options to purchase the whole or any part of the authorized and unissued shares of the Corporation at such times and to such persons and for such consideration as the board shall determine, provided that no share shall be issued until it is fully paid as prescribed by the Act. 5.02 COMMISSIONS: The board may from time to time authorize the Corporation to pay a commission to any person in consideration of his purchasing or agreeing to purchase shares of the Corporation, whether from the Corporation or from any other person, or procuring or agreeing to procure purchasers for any such shares. 5.03 REGISTRATION OF TRANSFER: Subject to the provisions of the Act, no transfer of shares shall be registered in a securities register except upon presentation of the certificate representing such shares with a transfer endorsed thereon or delivered therewith duly executed by the registered holder or by his attorney or successor duly appointed, together with such reasonable assurance or evidence of signature, identification and authority to transfer as the board may from time to time prescribe, upon payment of all applicable taxes and any fees prescribed by the board and upon compliance with such restrictions on transfer as are authorized by the articles. 5.04 SHARE CERTIFICATES: Every holder of one or more shares of the Corporation shall be entitled, upon request, to a share certificate, or to a non-transferable written acknowledgement of his right to obtain a share certificate, stating the number and class - 10 - or series of shares held by him as shown on the securities register. Share certificates and acknowledgements of a shareholder's right to a share certificate, respectively, shall be in such form as the board shall from time to time approve. Any share certificate shall be signed in accordance with section 9.01; provided that, unless the board otherwise determines, certificates representing shares in respect of which a transfer agent and/or registrar has been appointed shall not be valid unless countersigned by or on behalf of such transfer agent and/or registrar. A share certificate shall be signed manually by at least one director or officer of the Corporation or by or on behalf of the transfer agent and/or registrar. Any additional signatures required may be printed or otherwise mechanically reproduced. A share certificate executed as aforesaid shall be valid notwithstanding that one of the directors or officers whose facsimile signature appears thereon no longer holds office at the date of issue of the certificate. 5.05 DEFACED, DESTROYED, STOLEN OR LOST CERTIFICATES: In case of the defacement, destruction, theft or loss of a share certificate, the fact of such defacement, destruction, theft or loss shall be reported by the owner to the Corporation or to a transfer agent or a branch transfer agent of the Corporation (if any) on behalf of the Corporation within a reasonable time after the owner knows of the same, with a statement verified by oath or statutory declaration as to the defacement, destruction, theft or loss and the circumstances concerning the same and with a request for the issuance of a new certificate to replace the one so defaced, destroyed, stolen or lost. Subject to the Act, the board of directors, or any officer designated by the board of directors may, in its or his discretion, direct the issue of a new share certificate in lieu of, and upon cancellation of a share certificate that has become mutilated or defaced, and shall direct the issue of a new share certificate in substitution of a share certificate that has been lost, apparently destroyed or wrongfully taken on such terms, if any, as to indemnity and as to evidence of loss and of title as the board of directors may from time to time prescribe, whether generally or in any particular case. 5.06 JOINT SHAREHOLDERS: If two (2) or more persons are registered as joint holders of any share, the Corporation shall not be bound to issue more than one certificate in respect thereof, and delivery of such certificate to one of such persons shall be sufficient delivery to all of them. Any one of such persons may give effectual receipts for the certificate issued in respect thereof or for any dividend, bonus, return of capital or other money payable or warrant issuable in respect of such share. 5.07 DECEASED SHAREHOLDERS: In the event of the death of a holder, or of one of the joint holders, of any share, the Corporation shall not be required to make any entry in the securities register in respect thereof or to make payment of any dividends thereon except upon production of all such documents as may be required by the Act and otherwise by law and upon compliance with the reasonable requirements of the Corporation and its transfer agents. - 11 - SECTION SIX MEETINGS OF SHAREHOLDERS 6.01 ANNUAL MEETINGS: The annual meeting of shareholders shall be held at such time in each year and, subject to section 6.03 hereof, at such place as may from time to time be determined by the board, or if the board does not so determine, the Chairman of the Board, if any, or, if he does not so determine, the President, for the purpose of considering the financial statements and reports required by the Act to be placed before the annual meeting, electing directors, appointing auditors and for the transaction of such other business as may properly be brought before the meeting. 6.02 SPECIAL MEETINGS: The board, the Chairman of the Board, if any, or the President shall have power as set forth in section 6.01 hereof, to call a special meeting of the shareholders at any time. 6.03 PLACE OF MEETINGS: Subject to the articles and any unanimous shareholder agreement, meetings of shareholders shall be held at such place in or outside Ontario as the directors determine or at the registered office of the Corporation. 6.04 NOTICE OF MEETINGS: Notice of the time and place of each meeting of shareholders shall be given in the manner provided in section 8.01 hereof not less than ten (10), nor more than fifty (50) days before the date of the meeting to each director, to the auditor and to each shareholder entitled to vote at the meeting. Notice of a meeting of shareholders called for any purpose other than consideration of the minutes of an earlier meeting, financial statements and auditor's report, election of directors and reappointment of the incumbent auditor shall state the nature of such business in sufficient detail to permit the shareholder to form a reasoned judgment thereof and shall state the text of any special resolution to be submitted to the meeting. A shareholder may in any manner and at any time waive notice of or otherwise consent to a meeting of shareholders. 6.05 LIST OF SHAREHOLDERS ENTITLED TO NOTICE: For every meeting of shareholders, the Corporation shall prepare a list of shareholders entitled to receive notice of the meeting, arranged in alphabetical order and showing the number of shares entitled to vote at the meeting held by each shareholder. 6.06 RECORD DATES: (a) The directors may fix in advance a record date for the purpose of determining shareholders entitled to receive notice of a meeting of the shareholders, but the record date so fixed shall not be less than twenty-one (21) days or more than fifty (50) days prior to the date on which the meeting is to be held. - 12 - (b) Where the directors do not fix a record date as provided in paragraph 6.06 (a) hereof, the record date for the determination of shareholders entitled to receive notice of a meeting of shareholders shall be at the close of business on the day immediately preceding the day on which notice is given, or if no notice is given, on the day on which the meeting is held. The record date for the determination of shareholders for any purpose other than to establish a shareholder's right to receive notice of a meeting or to vote shall be at the close of business on the day on which the directors pass the resolution relating thereto. 6.07 MEETINGS WITHOUT NOTICE: A meeting of shareholders may be held without notice at any time and place permitted by the Act: (a) if all the shareholders entitled to vote thereat are present in person or represented by proxy or if those not present or represented by proxy waive notice of or otherwise consent to such meeting being held; and (b) if the auditors and the directors are present or waive notice of or otherwise consent to such meeting being held. At such a meeting any business may be transacted which the Corporation at a meeting of shareholders may transact. 6.08 CHAIRMAN, SECRETARY AND SCRUTINEERS: The chairman of any meeting of shareholders shall be the first mentioned of such of the following officers as have been appointed and who is present at the meeting: Chairman of the Board, President or a Vice-President. If no such officer is present within fifteen (15) minutes from the time fixed for holding the meeting, the persons present and entitled to vote shall choose one of their number to be chairman. If the Secretary of the Corporation is absent, the chairman shall appoint some person, who need not be a shareholder, to act as Secretary of the meeting. If desired, one or more scrutineers, who need not be shareholders, may be appointed by a resolution or by the chairman with the consent of the meeting. 6.09 PERSONS ENTITLED TO BE PRESENT: The only persons entitled to be present at a meeting of the shareholders shall be those entitled to vote thereat, the directors and auditors of the Corporation and others who, although not entitled to vote, are entitled or required under any provision of the Act or the articles or by-laws to be present at the meeting. Any other person may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting. 6.10 QUORUM: Subject to the Act, the articles and the provisions of any other by law of the Corporation, the quorum for the transaction of business at a meeting of shareholders shall be two (2) persons present in person, each being a shareholder entitled to vote thereat or a duly appointed proxy for an absent shareholder so entitled, holding - 13 - or representing not less than fifty-one percent (51 %) of the issued shares entitled to vote at such meeting. No business shall be transacted at any meeting unless a quorum is present at the commencement of such business. 6.11 RIGHT TO VOTE: Subject to the provisions of the Act as to authorized representatives of any other body corporate, at any meeting of shareholders in respect of which the Corporation has prepared the list referred to in section 6.05 hereof, every person who is named in such list shall be entitled to vote the shares shown thereon opposite his name except to the extent that such person has transferred any of his shares after such record date and the transferee, upon producing properly endorsed certificates evidencing such shares or otherwise establishing that he owns such shares, demands not later than one (1) day before the meeting that his name be included to vote the transferred shares at the meeting. In the absence of a list prepared as aforesaid in respect of a meeting of shareholders, every person shall be entitled to vote at the meeting who at the time is entered in the securities register as the holder of one or more shares carrying the right to vote at such meeting. Where a person holds shares as a personal representative, that person or his proxy is the person entitled to vote at all meetings of shareholders in respect of the shares so held by him. 6.12 PROXIES: Every shareholder entitled to vote at a meeting of shareholders may appoint a proxyholder, or one or more alternate proxyholders, who need not be shareholders as the shareholder's nominee, to attend and act at the meeting in the manner, to the extent authorized and with the authority conferred by the proxy. A proxy shall be in writing executed by the shareholder or his duly appointed attorney and shall conform with the requirements of the Act. 6.13 TIME FOR DEPOSIT OF PROXIES: The board may, if authorized by resolution, specify in a notice calling a meeting of shareholders a time, preceding the time of such meeting by not more than forty-eight (48) hours exclusive of non-business days, before which time proxies to be used at such meeting must be deposited. A proxy shall be acted upon only if, prior to the time so specified, it shall have been deposited with the Corporation or an agent thereof specified in such notice or, if no such time is specified in such notice, unless it has been received by the Secretary of the Corporation or by the chairman of the meeting or any adjournment thereof prior to the time of voting. 6.14 JOINT SHAREHOLDERS: If two (2) or more persons hold shares jointly, any one of them present in person or represented by proxy at a meeting of shareholders may, in the absence of the other or others, vote the shares; but if two (2) or more of those persons are present in person or represented by proxy and vote, they shall vote as one the shares jointly held by them. 6.15 VOTES TO GOVERN: At any meeting of shareholders every question shall, unless otherwise required by the Act, the articles or by-laws or by law, be determined by the majority of the votes cast on the question. In case of an equality of votes either upon a show of hands or upon a poll, the chairman of the meeting shall be entitled to a - 14 - second or casting vote. 6.16 SHOW OF HANDS: Subject to the provisions of the Act, any question at a meeting of shareholders shall be decided by a show of hands unless a ballot thereon is required or demanded as hereinafter provided. Whenever a vote by show of hands shall have been taken upon a question, unless a ballot thereon is so required or demanded, a declaration by the chairman of the meeting that the vote upon the question has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting shall be prima facie evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against any resolution or other proceeding in respect of the said question, and the result of the vote so taken shall be the decision of the shareholders upon the said question. 6.17 BALLOTS: On any question proposed for consideration at a meeting of shareholders, and whether or not a show of hands has been taken thereof, any shareholder or proxyholder entitled to vote at the meeting may require or demand a ballot. A ballot so required or demanded shall be taken in such manner as the chairman shall direct except if the ballot be demanded on the election of a chairman or on the question or adjournment or termination, in which event the ballot shall be taken forthwith without adjournment. A requirement or demand for a ballot may be withdrawn at any time prior to the taking of the ballot. If a ballot is taken, each person present shall be entitled, in respect of the shares which he is entitled to vote at the meeting upon the question, to that number of votes provided by the Act or the articles, and the result of the ballot so taken shall be the decision of the shareholders upon the said question. 6.18 ADJOURNMENTS: If a meeting of shareholders is adjourned for less than thirty (30) days to a specific time and place, it shall not be necessary to give notice of the adjourned meeting, other than by announcement at the earliest meeting that is adjourned. If a meeting of shareholders is adjourned by one or more adjournments for an aggregate of thirty (30) days or more, notice of the adjourned meeting shall be given as for an original meeting. 6.19 RESOLUTION IN WRITING: A resolution in writing signed by all of the shareholders entitled to vote on that resolution at a meeting of shareholders is as valid as if it had been passed at a meeting of the shareholders unless a written statement with respect to the subject matter of the resolution is submitted by a director or where representations in writing are submitted by an auditor in accordance with the Act. 6.20 ONLY ONE SHAREHOLDER: Where the Corporation has only one shareholder or only one holder of any class or series of shares, the shareholder present in person or by proxy constitutes a meeting. - 15 - SECTION SEVEN DIVIDENDS AND RIGHTS 7.01 DIVIDENDS: Subject to the provisions of the Act, the articles and any unanimous shareholder agreement, the directors may from time to time declare and the Corporation may pay dividends payable to the shareholders according to their respective rights and interests in the Corporation. Dividends may, subject to such provisions, be paid in money or property or by issuing fully paid shares of the Corporation or options or rights to acquire fully paid shares of the Corporation. 7.02 DIVIDEND CHEQUES: A dividend payable in cash shall be paid by cheque drawn on the Corporation's bankers or one of them to the order of each registered holder of shares of the class or series in respect of which it has been declared and mailed by prepaid ordinary mail to such registered holder at his recorded address, unless such holder otherwise directs. In the case of joint holders the cheque shall, unless such joint holders otherwise direct, be made payable to the order of all of such joint holders and mailed to them at their recorded address. The mailing of such cheque as aforesaid, unless the same is not paid on due presentation, shall satisfy and discharge the liability for the dividend to the extent of the sum represented thereby plus the amount of any tax which the Corporation is required to and does withhold. 7.03 NON-RECEIPT OF CHEQUES: In the event of non-receipt of any dividend cheque by the person to whom it is sent as aforesaid, the Corporation shall issue to such person a replacement cheque for a like amount on such terms as to indemnity, reimbursement of expenses and evidence of non-receipt and of title as the board may from time to time prescribe, whether generally or in any particular case. SECTION EIGHT NOTICES 8.01 METHOD OF GIVING NOTICE: Any notice (which term includes any communication or document) to be given (which term includes sent, delivered or served) pursuant to the Act, the regulations thereunder, the articles, the by-laws or otherwise to a shareholder, director, officer, auditor or member of a committee of the board shall be sufficiently given if delivered personally to the person to whom it is to be given or if delivered to his recorded address or if mailed to him at his recorded address by prepaid ordinary or air mail or if sent to him at his recorded address by any means of prepaid transmitted or recorded communication. A notice so delivered shall be deemed to have been given when it is delivered personally or to the recorded address as aforesaid; a notice so mailed shall be deemed to have been given when deposited in a post office or public letter box and shall be deemed to have been received on the fifth day after so - 16 - depositing; and a notice so sent by any means of transmitted or recorded communication shall be deemed to have been given when dispatched or delivered to the appropriate communication company or agency or its representative for dispatch. The Secretary may change or cause to be changed the recorded address of any shareholder, director, officer, auditor or member of a committee of the board in accordance with any information in writing submitted to him by the shareholder or his duly authorized or appointed representative or attorney. The recorded address of a director shall be his latest address as shown in the records of the Corporation or in the most recent notice filed under the Corporations Information Act, whichever is the more current. 8.02 NOTICE TO JOINT SHAREHOLDERS: If two (2) or more persons are registered as joint holders of any share, any notice shall be addressed to all of such joint holders but notice to one of such persons shall be sufficient notice to all of them. 8.03 COMPUTATION OF TIME: In computing the date when notice must be given under any provision requiring a specified number of days notice of any meeting or other event, the date of the meeting or other event shall be excluded. 8.4 UNDELIVERED NOTICES: If any notice given to a shareholder pursuant to section 8.01 is returned on three (3) consecutive occasions because he cannot be found, the Corporation shall not be required to give any further notices to such shareholder until he informs the Corporation in writing of his new address. 8.05 OMISSIONS AND ERRORS: The accidental or inadvertent omission to give any notice to any shareholder, director, officer, auditor or member of a committee of the board or the non-receipt of any notice by any such person or any error in any notice not affecting the substance thereof shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise founded thereon. 8.6 PERSONS ENTITLED BY OPERATION OF LAW: Every person who shall become entitled to any share by operation of law, transfer or any other means whatsoever, shall be bound by every notice in respect of such share which shall have been duly given to the shareholder from whom he derives his title to such share prior to his name and address being entered on the securities register (whether such notice was given before or after the happening of the event upon which he became so entitled) and prior to his furnishing to the Corporation the proof of authority or evidence of his entitlement prescribed by the Act. 8.7 DECEASED SHAREHOLDER: Any notice given to a shareholder in accordance with section 8.01 shall, notwithstanding that such shareholder be then deceased and whether or not the Corporation has notice of his decease, be deemed to have been duly served in respect of the shares held by such shareholder (whether held solely or with other persons) until some other person be entered in his stead in the records of the Corporation as the holder or one of the holders thereof and such service shall for all purposes be deemed a sufficient service of such notice or other document on his heirs, executors or - 17 - administrators and all persons (if any) interested with him in such shares. 8.08 WAIVER OF NOTICE: Any shareholder (or his duly appointed proxyholder), director, officer, auditor or member of a committee of the board may at any time waive any notice, or waive or abridge the time for any notice, required to be given to him under any provisions of the Act, the regulations thereunder, the articles, the by-laws or otherwise and such waiver or abridgement shall cure any default in the giving or in the time of such notice, as the case may be. Any such waiver or abridgement shall be in writing except a waiver of notice of a meeting of shareholders or of the board which may be given in any manner. 8.09 PROOF OF SERVICE: A certificate of any officer of the Corporation in office at the time of the making of the certificate or of a transfer officer of any transfer agent or branch transfer agent of shares of any class of the Corporation as to facts in relation to the mailing or delivery or service of any notice or other document to any shareholder, director, officer or auditor or publication of any notice or other document shall be conclusive evidence thereof and shall be binding on every shareholder, director, officer or auditor of the Corporation, as the case may be. SECTION NINE EXECUTION OF DOCUMENTS 9.01 SIGNING OFFICERS: Deeds, transfers, assignments, contracts, obligations and instruments in writing requiring the signature of the Corporation may be signed by the President or a Vice-President or a director, together with the Secretary or Treasurer or an Assistant Secretary or Assistant Treasurer or another director. Notwithstanding this, the board may at any time and from time to time direct the manner in which and the person or persons by whom any particular deed, transfer, contract or obligation or any class of deeds, transfers, contracts or obligations may be signed. 9.02 SEAL: Any person authorized to sign any document may affix the corporate seal, if any, thereto. 9.03 MECHANICAL REPRODUCTION OF SIGNATURES: The signature or signatures of any officer or director of the Corporation and/or of any other officer or officers, person or persons appointed as aforesaid by resolution of the board of directors may, if specifically authorized by resolution of the directors, be printed, engraved, lithographed or otherwise mechanically reproduced upon all contracts, documents or instruments in writing or bonds, debentures or other securities of the Corporation executed or issued by or on behalf of the Corporation and all contracts, documents or instruments in writing or bonds, debentures or other securities of the Corporation on which the signature or signatures of any of the foregoing officers, directors or persons shall be so reproduced as authorized by resolution of the board of directors, shall be deemed to have been - 18 - manually signed by such officers, directors or persons whose signature or signatures is or are so reproduced and shall be as valid to all intents and purposes as if they bad been signed manually and notwithstanding that the officers, directors or persons whose signature or signatures is or are so reproduced may have ceased to hold office at the date of delivery or issue of such contracts, documents or instruments in writing or bonds, debentures or other securities of the Corporation. SECTION TEN FISCAL YEAR, REGISTERED OFFICE 10.1 FISCAL PERIOD: The fiscal period of the Corporation shall terminate on such day in each year as the board of directors may from time to time by resolution determine. 10.2 REGISTERED OFFICE: The Corporation may from time to time: (i) by resolution of the directors change the address of the registered office of the Corporation within the municipality or geographic township within Ontario specified in its articles; and (ii) by special resolution change the municipality or geographic township within Ontario in which its registered office is situated. SECTION ELEVEN UNANIMOUS SHAREHOLDER AGREEMENT 11.01 UNANIMOUS SHAREHOLDER AGREEMENT: Notwithstanding any provision of this by-law but subject to the Act, in the event of the execution and delivery of a unanimous shareholder agreement providing inter alia, that the provisions thereof shall prevail in the event of a conflict with the by-laws of the Corporation, the provisions of such unanimous shareholder agreement shall supersede the conflicting provisions of the by-laws of the Corporation, and such conflicting provisions of such by-laws shall be deemed to be amended accordingly as and from the later of the effective date of such agreement and the date such by-laws are made. - 19 - SECTION TWELVE EFFECTIVE DATE 12.01 EFFECTIVE DATE: This by-law is not effective until it is passed by the directors and confirmed by a majority of the votes cast at a special meeting of the shareholders of the Corporation duly called for that purpose, or such greater proportion of the votes cast as the articles provide or, in lieu of such confirmation, by the consent in writing of all the shareholders entitled to vote at such meeting. PASSED as of the 19th day of December, 1996. WITNESS the corporate seal of the Corporation. /s/ Ronald L. Smith /s/ Wayne F. Taylor - ------------------------------- ---------------------------------- President - Ronald L. Smith Secretary - Wayne F. Taylor BY-LAW NO. 2 A by-law respecting the borrowing of money by CINCINNATI MILACRON CANADA INC. BE IT ENACTED AND IT IS HEREBY ENACTED as a by-law of CINCINNATI MILACRON CANADA INC. (hereinafter called the "corporation") as follows: 1. The directors may from time to time; (a) borrow money upon the credit of the Corporation (b) issue, reissue, sell or pledge debt obligations of the Corporation; (c) subject to Section 20 of the Business Corporations Act, R.S.O. 1990, c.B.16 (hereinafter called the "Act"), give a guarantee on behalf of the Corporation to secure performance of an obligation of any person; and (d) mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the Corporation, owned or subsequently acquired to secure any debt obligations of the Corporation. The words "debt obligation" and "security interest" as used in this paragraph shall have the meanings provided in subsection 1(1) of the Act. 2. The directors may from time to time, by resolution, delegate to the President and the Secretary or to any two individuals (including the President or the Secretary), each of whom is an officer of the Corporation, all or any of the powers conferred on the directors by paragraph 1 of this by-law in the manner and on the terms authorized by the directors in such resolution. - 2 - 3. The powers hereby conferred shall be deemed to be in supplement of and not in substitution for any powers, including without limitation, the power to delegate to a managing director or a committee of directors any of the powers of the directors in accordance with the provisions of Section 127 of the Act, to borrow money for the purposes of the Corporation possessed by its directors or officers independently of a borrowing by-law. PASSED as of the 19th day of December, 1996. WITNESS the corporate seal of the Corporation. /s/ Ronald L. Smith /s/ Wayne F. Taylor - ------------------------------- ---------------------------------- President - Ronald L. Smith Secretary - Wayne F. Taylor EX-3.45 43 y98028exv3w45.txt CERTIFICATE OF INCORPORATION Exhibit 3.45 STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 04:30 PM 07/07/1999 991277237 - 3059231 CERTIFICATE OF INCORPORATION OF MILACRON PLASTICS TECHNOLOGIES GROUP INC. I, the undersigned, for the purposes of incorporating and organizing a corporation under the General Corporation Law of the State of Delaware, do execute this Certificate of Incorporation and do hereby certify as follows: FIRST. The name of the corporation is Milacron Plastics Technologies Group Inc. SECOND. The address of the corporation's registered office in the State of Delaware is 1209 Orange Street, in the City of Wilmington, County of New Castle, 19801. The name of its registered agent at such address is The Corporation Trust Company. THIRD. The purpose of the corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware. FOURTH. The total number of shares of stock which the corporation shall have authority to issue is 1,000. All such shares are to be Common Stock, par value of $1.00 per share, and are to be of one class. FIFTH. The incorporator of the corporation is RL&F Service Corp., whose mailing address is One Rodney Square, 10th Floor, Tenth and King Streets, Wilmington DE 19801. SIXTH. Unless and except to the extent that the by-laws of the corporation shall so require, the election of directors of the corporation need not be by written ballot. SEVENTH. In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors of the corporation is expressly authorized to make, alter and repeal the by-laws of the corporation, subject to the power of the stockholders of the corporation to alter or repeal any by-law whether adopted by them or otherwise. EIGHTH. A director of the corporation shall not be liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the General Corporation Law of the State of Delaware as the same exists or may hereafter be amended. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of the corporation hereunder in respect -1- of any act or omission occurring prior to the time of such amendment, modification or repeal. NINTH. The corporation reserves the right at any time, and from time to time, to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, and other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted, in the manner now or hereafter prescribed by law; and all rights, preferences and privileges of whatsoever nature conferred upon stockholders, directors or any other persons whomsoever by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended are granted subject to the rights reserved in this article. TENTH. The powers of the incorporator are to terminate upon the filing of this Certificate of Incorporation with the Secretary of State of the State of Delaware. The names and mailing addresses of the persons who are to serve as the initial directors of the corporation until the first annual meeting of stockholders of the corporation, or until their successors are duly elected and qualified, are: Daniel J. Meyer 2090 Florence Avenue Cincinnati, OH 45206 Harold J. Faig 2090 Florence Avenue Cincinnati, OH 45206 Ronald D. Brown 2090 Florence Avenue Cincinnati, OH 45206 The undersigned incorporator hereby acknowledges that the foregoing certificate of incorporation is his act and deed on this the 7th day of July 1999. RL&F SERVICE CORP. By: /s/ C. Stephen Bigler -------------------------------- C. Stephen Bigler President -2- EX-3.46 44 y98028exv3w46.txt BYLAWS EXHIBIT 3.46 BY-LAWS OF MILACRON PLASTICS TECHNOLOGIES GROUP INC. ARTICLE I Meetings of Stockholders Section 1.1. Annual Meetings. An annual meeting of stockholders shall be held for the election of directors at such date, time and place, either within or without the State of Delaware, as may be designated by resolution of the Board of Directors from time to time. Any other proper business may be transacted at the annual meeting. Section 1.2. Special Meetings. Special meetings of stockholders for any purpose or purposes may be called at any time by the Board of Directors, but such special meetings may not be called by any other person or persons. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice. Section 1.3. Notice of Meetings. Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given that shall state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise provided by law, the certificate of incorporation or these by-laws, the written notice of any meeting shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Section 1.4. Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. Section 1.5. Quorum. Except as otherwise provided by law, the certificate of incorporation or these by-laws, at each meeting of stockholders the presence in person or by proxy of the holders of a majority in voting power of the outstanding shares of stock entitled to vote at the meeting shall be necessary and sufficient to constitute a quorum. In the absence of a quorum, the stockholders so present may, by a majority in voting power thereof, adjourn the meeting from time to time in the manner provided in Section 1.4 of these by-laws until a quorum shall attend. Shares of its own stock belonging to the corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the corporation, shall neither be entitled to vote nor be counted for quorum purposes; provided, however, that the foregoing shall not limit the right of the corporation or any subsidiary of the corporation to vote stock, including but not limited to its own stock, held by it in a fiduciary capacity. Section 1.6. Organization. Meetings of stockholders shall be presided over by the Chairman of the Board, if any, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in his absence by a Vice President, or in the absence of the foregoing persons by a chairman designated by the Board of Directors, or in the absence of such designation by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting. Section 1.7. Voting; Proxies. Except as otherwise provided by or pursuant to the provisions of the certificate of incorporation, each stockholder entitled to vote at any meeting of stockholders shall be entitled to one vote for each share of stock held by such stockholder which has voting power upon the matter in question. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or by delivering a proxy in accordance with applicable law bearing a later date to the Secretary of the corporation. Voting at meetings of stockholders need not be by written ballot. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect. All other elections and questions shall, unless otherwise provided by the certificate of incorporation, these by-laws, the rules or regulations of any stock exchange applicable to the corporation, as otherwise provided by law or pursuant to any regulation applicable to the corporation, be decided by the affirmative vote of the holders of a majority in voting power of the shares of stock of the corporation which are present in person or by proxy and entitled to vote thereon. -2- Section 1.8. Fixing Date for Determination of Stockholders of Record. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date: (1) in the case of determination of stockholders entitled to vote at any meeting of stockholders or adjournment thereof, shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting; (2) in the case of determination of stockholders entitled to express consent to corporate action in writing without a meeting, shall not be more than ten (10) days from the date upon which the resolution fixing the record date is adopted by the Board of Directors; and (3) in the case of any other action, shall not be more than sixty (60) days prior to such other action. If no record date is fixed: (1) the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; (2) the record date for determining stockholders entitled to express consent to corporate action in writing without a meeting, when no prior action of the Board of Directors is required by law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation in accordance with applicable law, or, if prior action by the Board of Directors is required by law, shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action; and (3) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Section 1.9. List of Stockholders Entitled to Vote. The Secretary shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present. Upon the willful neglect or refusal of the directors to produce such a list at any meeting for the election of directors, they shall be ineligible for election to -3- any office at such meeting. Except as otherwise provided by law, the stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list of stockholders or the books of the corporation, or to vote in person or by proxy at any meeting of stockholders. Section 1.10. Action By Written, Consent of Stockholders. Unless otherwise restricted by the certificate of incorporation, any action required or permitted to be taken at any annual or special meeting of the stockholders may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the corporation having custody of the book in which minutes of proceedings of stockholders are recorded. Delivery made to the corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall, to the extent required by law, be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of holders to take the action were delivered to the corporation. Section 1.11. Inspectors of Election. The corporation may, and shall if required by law, in advance of any meeting of stockholders, appoint one or more inspectors of election, who may be employees of the corporation, to act at the meeting or any adjournment thereof and to make a written report thereof. The corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. In the event that no inspector so appointed or designated is able to act at a meeting of stockholders, the person presiding at the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath to execute faithfully the duties of inspector with strict impartiality and according to the best of his or her ability. The inspector or inspectors so appointed or designated shall (i) ascertain the number of shares of capital stock of the corporation outstanding and the voting power of each such share, (ii) determine the shares of capital stock of the corporation represented at the meeting and the validity of proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, and (v) certify their determination of the number of shares of capital stock of the corporation represented at the meeting and such inspectors' count of all votes and ballots. Such certification and report shall specify such other information as may be required by law. In determining the validity and counting of proxies and ballots cast at any meeting of stockholders of the corporation, the inspectors may consider such information as is -4- permitted by applicable law. No person who is a candidate for an office at an election may serve as an inspector at such election. Section 1.12. Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of any meeting of stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the chairman of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to stockholders of record of the corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. Unless and to the extent determined by the Board of Directors or the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure. -5- ARTICLE II Board of Directors Section 2.1. Number; Qualifications. The Board of Directors shall consist of one or more members, the number thereof to be determined from time to time by resolution of the Board of Directors. Directors need not be stockholders. Section 2.2. Election; Resignation; Vacancies. The Board of Directors shall initially consist of the persons named as directors in the certificate of incorporation or elected by the incorporator of the corporation, and each director so elected shall hold office until the first annual meeting of stockholders or until his successor is duly elected and qualified. At the first annual meeting of stockholders and at each annual meeting thereafter, the stockholders shall elect directors each of whom shall hold office for a term of one year or until his successor is duly elected and qualified, subject to such director's earlier death, resignation, disqualification or removal. Any director may resign at any time upon written notice to the corporation. Unless otherwise provided by law or the certificate of incorporation, any newly created directorship or any vacancy occurring in the Board of Directors for any cause may be filled by a majority of the remaining members of the Board of Directors, although such majority is less than a quorum, or by a plurality of the votes cast at a meeting of stockholders, and each director so elected shall hold office until the expiration of the term of office of the director whom he has replaced or until his successor is elected and qualified. Section 2.3. Regular Meetings. Regular meetings of the Board of Directors may be held at such places within or without the State of Delaware and at such times as the Board of Directors may from time to time determine. Section 2.4. Special Meetings. Special meetings of the Board of Directors may be held at any time or place within or without the State of Delaware whenever called by the President, any Vice President, the Secretary, or by any member of the Board of Directors. Notice of a special meeting of the Board of Directors shall be given by the person or persons calling the meeting at least twenty-four hours before the special meeting. Section 2.5. Telephonic Meetings Permitted. Members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting thereof by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this by-law shall constitute presence in person at such meeting. Section 2.6. Quorum; Vote Required for Action. At all meetings of the Board of Directors a majority of the whole Board of Directors shall constitute a quorum for -6- the transaction of business. Except in cases in which the certificate of incorporation, these by-laws or applicable law otherwise provides, the vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Section 2.7. Organization. Meetings of the Board of Directors shall be presided over by the Chairman of the Board, if any, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in their absence by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting. Section 2.8. Action by Written Consent of Directors. Unless otherwise restricted by the certificate of incorporation or these by-laws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or such committee. -7- ARTICLE III Committees Section 3.1. Committees. The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of the committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in place of any such absent or disqualified member. Any such committee, to the extent permitted by law and to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it. Section 3.2. Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board of Directors may make, alter and repeal rules for the conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board of Directors conducts its business pursuant to Article II of these by-laws. -8- ARTICLE IV Officers Section 4.1. Executive Officers; Election; Qualifications; Term of Office; Resignation; Removal; Vacancies. The Board of Directors shall elect a President and Secretary, and it may, if it so determines, choose a Chairman of the Board and a Vice Chairman of the Board from among its members. The Board of Directors may also choose one or more Vice Presidents, one or more Assistant Secretaries, a Treasurer and one or more Assistant Treasurers. Each such officer shall hold office until the first meeting of the Board of Directors after the annual meeting of stockholders next succeeding his election, and until his successor is elected and qualified or until his earlier resignation or removal. Any officer may resign at any time upon written notice to the corporation. The Board of Directors may remove any officer with or without cause at any time, but such removal shall be without prejudice to the contractual rights of such officer, if any, with the corporation. Any number of offices may be held by the same person. Any vacancy occurring in any office of the corporation by death, resignation, removal or otherwise may be filled for the unexpired portion of the term by the Board of Directors at any regular or special meeting. Section 4.2. Powers and Duties of Executive Officers. The officers of the corporation shall have such powers and duties in the management of the corporation as may be prescribed in a resolution by the Board of Directors and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors. The Board of Directors may require any officer, agent or employee to give security for the faithful performance of his duties. -9- ARTICLE V Stock Section 5.1. Certificates. Every holder of stock shall be entitled to have a certificate signed by or in the name of the corporation by the Chairman or Vice Chairman of the Board of Directors, if any, or the President or a Vice President, and by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary, of the corporation certifying the number of shares owned by him in the corporation. Any of or all the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue. Section 5.2. Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates. The corporation may issue a new certificate of stock in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen or destroyed certificate, or his legal representative, to give the corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. -10- ARTICLE VI Indemnification Section 6.1. Right to Indemnification. The corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person (an "Indemnitee") who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "proceeding"), by reason of the fact that he, or a person for whom he is the legal representative, is or was a director or officer of the corporation or, while a director or officer of the corporation, is or was serving at the written request of the corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such Indemnitee. Notwithstanding the preceding sentence, except as otherwise provided in Section 6.3, the corporation shall be required to indemnify an Indemnitee in connection with a proceeding (or part thereof) commenced by such Indemnitee only if the commencement of such proceeding (or part thereof) by the Indemnitee was authorized by the Board of Directors. Section 6.2. Prepayment of Expenses. The corporation shall pay the expenses (including attorneys' fees) incurred by an Indemnitee in defending any proceeding in advance of its final disposition, provided, however, that, to the extent required by law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by the Indemnitee to repay all amounts advanced if it should be ultimately determined that the Indemnitee is not entitled to be indemnified under this Article VI or otherwise. Section 6.3. Claims. If a claim for indemnification or advancement of expenses under this Article VI is not paid in full within sixty (60) days after a written claim therefor by the Indemnitee has been received by the corporation, the Indemnitee may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim. In any such action the corporation shall have the burden of proving that the Indemnitee is not entitled to the requested indemnification or advancement of expenses under applicable law. Section 6.4. Nonexclusivity of Rights. The rights conferred on any Indemnitee by this Article VI shall not be exclusive of any other rights which such Indemnitee may have or hereafter acquire under any statute, provision of the certificate of incorporation, these by-laws, agreement, vote of stockholders or disinterested directors or otherwise. -11- Section 6.5. Other Sources. The corporation's obligation, if any, to indemnify or to advance expenses to any Indemnitee who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such Indemnitee may collect as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, enterprise or non-profit enterprise. Section 6.6. Amendment or Repeal. Any repeal or modification of the foregoing provisions of this Article VI shall not adversely affect any right or protection hereunder of any Indemnitee in respect of any act or omission occurring prior to the time of such repeal or modification. Section 6.7. Other Indemnification and Prepayment of Expenses. This Article VI shall not limit the right of the corporation, to the extent and in the manner permitted by law, to indemnify and to advance expenses to persons other than Indemnitees when and as authorized by appropriate corporate action. -12- ARTICLE VII Miscellaneous Section 7.1. Fiscal Year. The fiscal year of the corporation shall be determined by resolution of the Board of Directors. Section 7.2. Seal. The corporate seal shall have the name of the corporation inscribed thereon and shall be in such form as may be approved from time to time by the Board of Directors. Section 7.3. Manner of Notice. Except as otherwise provided herein, notices to directors and stockholders shall be in writing and delivered personally or mailed to the directors or stockholders at their addresses appearing on the books of the corporation. Notice to directors may be given by telegram, telecopier, telephone or other means of electronic transmission. Section 7.4. Waiver of Notice of Meetings of Stockholders, Directors and Committees. Any written waiver of notice, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at nor the purpose of any regular or special meeting of the stockholders, directors, or members of a committee of directors need be specified in any written waiver of notice. Section 7.5. Form of Records. Any records maintained by the corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or be in the form of, punch cards, magnetic tape, photographs, microphotographs, or any other information storage device, provided that the records so kept can be converted into clearly legible form within a reasonable time. Section 7.6. Amendment of By-Laws. These by-laws may be altered, amended or repealed, and new by-laws made, by the Board of Directors, but the stockholders may make additional by-laws and may alter and repeal any by-laws whether adopted by them or otherwise. -13- EX-4.1 45 y98028exv4w1.txt INDENTURE EXHIBIT 4.1 MILACRON ESCROW CORPORATION TO BE MERGED WITH AND INTO MILACRON INC. 11 1/2% SENIOR SECURED NOTES DUE 2011 INDENTURE Dated as of May 26, 2004 U.S. BANK NATIONAL ASSOCIATION Trustee CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section 310(a)(1)................................................................. 7.10 (a)(2)................................................................. 7.10 (a)(3)................................................................. N.A. (a)(4)................................................................. N.A. (a)(5)................................................................. 7.10 (b).................................................................... 7.10 (c).................................................................... N.A. 311(a).................................................................... 7.11 (b).................................................................... 7.11 (c).................................................................... N.A. 312(a).................................................................... 2.05 (b).................................................................... 13.03 (c).................................................................... 13.03 313(a).................................................................... 7.06 (b)(1)................................................................. 10.03 (b)(2)................................................................. 7.06; 7.07 (c).................................................................... 7.06; 10.03;13.02 (d).................................................................... 7.06 314(a).................................................................... 4.03;13.02; 13.05 (b).................................................................... 10.02 (c)(1)................................................................. 13.04 (c)(2)................................................................. 13.04 (c)(3)................................................................. N.A. (d).................................................................... 10.03; 10.04; 10.05 (e).................................................................... 13.05 (f).................................................................... N.A. 315(a).................................................................... 7.01 (b).................................................................... 7.05; 13.02 (c).................................................................... 7.01 (d).................................................................... 7.01 (e).................................................................... 6.11 316(a) (last sentence).................................................... 2.09 (a)(1)(A).............................................................. 6.05 (a)(1)(B).............................................................. 6.04 (a)(2)................................................................. N.A. (b).................................................................... 6.07 (c).................................................................... 2.12 317(a)(1)................................................................. 6.08 (a)(2)................................................................. 6.09 (b).................................................................... 2.04 318(a).................................................................... 13.01 (b).................................................................... N.A. (c).................................................................... 13.01
N.A. means not applicable. * This Cross Reference Table is not part of this Indenture. TABLE OF CONTENTS
Page ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE Section 1.01 Definitions............................................................................... 1 Section 1.02 Other Definitions......................................................................... 31 Section 1.03 Incorporation by Reference of Trust Indenture Act......................................... 32 Section 1.04 Rules of Construction..................................................................... 32 ARTICLE 2 THE NOTES Section 2.01 Form and Dating........................................................................... 34 Section 2.02 Execution and Authentication.............................................................. 35 Section 2.03 Registrar and Paying Agent................................................................ 35 Section 2.04 Paying Agent to Hold Money in Trust....................................................... 36 Section 2.05 Holder Lists.............................................................................. 36 Section 2.06 Transfer and Exchange..................................................................... 36 Section 2.07 Replacement Notes......................................................................... 48 Section 2.08 Outstanding Notes......................................................................... 48 Section 2.09 Treasury Notes............................................................................ 49 Section 2.10 Temporary Notes........................................................................... 49 Section 2.11 Cancellation.............................................................................. 49 Section 2.12 Defaulted Interest........................................................................ 49 Section 2.13 CUSIP Numbers............................................................................. 50 Section 2.14 Issuance of Additional Notes.............................................................. 50 ARTICLE 3 REDEMPTION AND PREPAYMENT Section 3.01 Notices to Trustee........................................................................ 50 Section 3.02 Selection of Notes to Be Redeemed or Purchased............................................ 51 Section 3.03 Notice of Redemption...................................................................... 51 Section 3.04 Effect of Notice of Redemption............................................................ 52 Section 3.05 Deposit of Redemption or Purchase Price................................................... 52 Section 3.06 Notes Redeemed or Purchased in Part....................................................... 52 Section 3.07 Optional Redemption....................................................................... 52 Section 3.08 Mandatory Redemption...................................................................... 53 Section 3.09 Offer to Purchase by Application of Excess Proceeds....................................... 53 Section 3.10 Offer to Purchase by Application of Collateral Proceeds................................... 54 Section 3.11 Special Mandatory Redemption.............................................................. 56 ARTICLE 4 COVENANTS Section 4.01 Payment of Notes.......................................................................... 56 Section 4.02 Maintenance of Office or Agency........................................................... 57 Section 4.03 Reports................................................................................... 57 Section 4.04 Compliance Certificate.................................................................... 58 Section 4.05 Taxes..................................................................................... 58 Section 4.06 Stay, Extension and Usury Laws............................................................ 58
i Section 4.07 Restricted Payments....................................................................... 59 Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries............................ 61 Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock................................ 63 Section 4.10 Asset Sales............................................................................... 67 Section 4.11 Transactions with Affiliates.............................................................. 70 Section 4.12 Liens..................................................................................... 71 Section 4.13 Business Activities....................................................................... 71 Section 4.14 Corporate Existence....................................................................... 71 Section 4.15 Offer to Repurchase Upon Change of Control................................................ 72 Section 4.16 Limitation on Sale and Leaseback Transactions............................................. 73 Section 4.17 Payments for Consent...................................................................... 73 Section 4.18 Additional Guarantees and Liens........................................................... 74 Section 4.19 Designation of Restricted and Unrestricted Subsidiaries................................... 74 Section 4.20 Escrow Account Deposits................................................................... 75 Section 4.21 Activities of the Company Prior to the Escrow Merger...................................... 75 ARTICLE 5 SUCCESSORS Section 5.01 Merger, Consolidation, or Sale of Assets.................................................. 76 Section 5.02 Successor Corporation Substituted......................................................... 77 ARTICLE 6 DEFAULTS AND REMEDIES Section 6.01 Events of Default......................................................................... 77 Section 6.02 Acceleration.............................................................................. 79 Section 6.03 Other Remedies............................................................................ 80 Section 6.04 Waiver of Past Defaults................................................................... 80 Section 6.05 Control by Majority....................................................................... 80 Section 6.06 Limitation on Suits....................................................................... 80 Section 6.07 Rights of Holders of Notes to Receive Payment............................................. 81 Section 6.08 Collection Suit by Trustee................................................................ 81 Section 6.09 Trustee May File Proofs of Claim.......................................................... 81 Section 6.10 Priorities................................................................................ 82 Section 6.11 Undertaking for Costs..................................................................... 82 ARTICLE 7 TRUSTEE Section 7.01 Duties of Trustee......................................................................... 82 Section 7.02 Rights of Trustee......................................................................... 83 Section 7.03 Individual Rights of Trustee.............................................................. 84 Section 7.04 Trustee's Disclaimer...................................................................... 84 Section 7.05 Notice of Defaults........................................................................ 84 Section 7.06 Reports by Trustee to Holders of the Notes................................................ 84 Section 7.07 Compensation and Indemnity................................................................ 84 Section 7.08 Replacement of Trustee.................................................................... 85 Section 7.09 Successor Trustee by Merger, etc.......................................................... 86 Section 7.10 Eligibility; Disqualification............................................................. 86 Section 7.11 Preferential Collection of Claims Against Company......................................... 86 ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE

ii Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.................................. 87 Section 8.02 Legal Defeasance and Discharge............................................................ 87 Section 8.03 Covenant Defeasance....................................................................... 87 Section 8.04 Conditions to Legal or Covenant Defeasance................................................ 88 Section 8.05 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions................................................................................ 89 Section 8.06 Repayment to Company...................................................................... 89 Section 8.07 Reinstatement............................................................................. 90 ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER Section 9.01 Without Consent of Holders of Notes....................................................... 90 Section 9.02 With Consent of Holders of Notes.......................................................... 91 Section 9.03 Compliance with Trust Indenture Act....................................................... 93 Section 9.04 Revocation and Effect of Consents......................................................... 93 Section 9.05 Notation on or Exchange of Notes.......................................................... 93 Section 9.06 Trustee to Sign Amendments, etc........................................................... 93 ARTICLE 10 COLLATERAL AND SECURITY Section 10.01. Collateral Documents...................................................................... 93 Section 10.02. Recording and Opinions.................................................................... 94 Section 10.03. Release of Collateral..................................................................... 94 Section 10.04. Certificates of the Company............................................................... 96 Section 10.05. Certificates of the Trustee............................................................... 96 Section 10.06. Authorization of Actions to Be Taken by the Trustee Under the Note Security Documents..... 96 Section 10.07. Authorization of Receipt of Funds by the Trustee Under the Pledge Agreement............... 97 Section 10.08. Termination of Security Interest.......................................................... 97 ARTICLE 11 NOTE GUARANTEES Section 11.01 Note Guarantee............................................................................ 97 Section 11.02 Limitation on Guarantor Liability......................................................... 98 Section 11.03 Execution and Delivery of the Note Guarantee.............................................. 99 Section 11.04 Guarantors May Consolidate, etc., on Certain Terms........................................ 99 Section 11.05 Releases.................................................................................. 100 ARTICLE 12 SATISFACTION AND DISCHARGE Section 12.01 Satisfaction and Discharge................................................................ 101 Section 12.02 Application of Trust Money................................................................ 102 ARTICLE 13 MISCELLANEOUS Section 13.01 Trust Indenture Act Controls.............................................................. 102 Section 13.02 Notices................................................................................... 102 Section 13.03 Communication by Holders of Notes with Other Holders of Notes............................. 103 Section 13.04 Certificate and Opinion as to Conditions Precedent........................................ 103 Section 13.05 Statements Required in Certificate or Opinion............................................. 104 Section 13.06 Rules by Trustee and Agents............................................................... 104

iii Section 13.07 No Personal Liability of Directors, Officers, Employees and Stockholders.................. 104 Section 13.08 Governing Law............................................................................. 104 Section 13.09 No Adverse Interpretation of Other Agreements............................................. 104 Section 13.10 Successors................................................................................ 104 Section 13.11 Severability.............................................................................. 105 Section 13.12 Counterpart Originals..................................................................... 105 Section 13.13 Table of Contents, Headings, etc.......................................................... 105

EXHIBITS Exhibit A1 FORM OF NOTE Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE Exhibit B FORM OF CERTIFICATE OF TRANSFER Exhibit C FORM OF CERTIFICATE OF EXCHANGE Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR Exhibit E FORM OF NOTATION OF GUARANTEE Exhibit F FORM OF SUPPLEMENTAL INDENTURE iv INDENTURE dated as of May 26, 2004 between Milacron Escrow Corporation, a Delaware corporation (the "Company"), to be merged with and into Milacron Inc. ("Milacron"), and U.S. Bank National Association, as trustee. The Company and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders (as defined) of the 11 1/2% Senior Secured Notes due 2011 (the "Notes"): ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE Section 1.01 Definitions. "144A Global Note" means a Global Note substantially in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold in reliance on Rule 144A. "ABL Facility" means the Financing Agreement dated on or before the date of the Escrow Merger by and among Milacron, as a borrower, certain subsidiaries of Milacron, as additional borrowers or guarantors, the lenders party thereto and JPMorgan Chase Bank, as the ABL Agent, as such agreement may be amended, restated supplemented, waived, replaced (whether or not upon termination, and with the original lenders or otherwise), refinanced, restructured or otherwise modified from time to time. "Acquired Debt" means, with respect to any specified Person: (1) Indebtedness of any other Person existing at the time such other Person is merged or amalgamated with or into or became a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Subsidiary of, such specified Person; and (2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person. "Additional Notes" means up to $50.0 million aggregate principal amount of additional Notes (other than the Initial Notes) issued under this Indenture in accordance with Sections 2.02 and 4.09 hereof, as part of the same series as the Initial Notes. "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, "control," as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be control. For purposes of this definition, the terms "controlling," "controlled by" and "under common control with" have correlative meanings. No Person (other than the Company or any Subsidiary of the Company) in whom a Receivables Subsidiary makes an Investment in connection with a Qualified Receivables Transaction will be deemed to be an Affiliate of the Company or any of its Subsidiaries solely by reason of such Investment. "Agent" means any Registrar, co-registrar, Paying Agent or additional paying agent. 1 "Applicable Premium" means, with respect to a Note at any Make-Whole Redemption Date, the greater of (1) 1.0% of the principal amount of such Note and (2) the excess of (a) the present value at such time of (i) the principal amount of such Note plus (ii) all required interest payments due on such Note through May 15, 2011, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the principal amount of such Note. "Applicable Procedures" means, with respect to any transfer or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer or exchange. "Asset Sale" means: (1) the sale, lease, conveyance or other disposition of any assets or rights (including, without limitation, by way of a sale and leaseback) or any damage or loss of property resulting in the payment of property insurance or condemnation proceeds to the Company or any Restricted Subsidiary; provided that the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its Subsidiaries taken as a whole will be governed by the provisions of Section 4.15 and/or Section 5.01 and not by Section 4.10 hereof; and (2) the issuance of Equity Interests in any of the Company's Restricted Subsidiaries or the sale of Equity Interests in any of its Subsidiaries. Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale: (1) any single transaction or series of related transactions that involves assets having a fair market value of less than $2.0 million or for net cash proceeds of less than $2.0 million; (2) a transfer of assets between or among the Company and its Restricted Subsidiaries, (3) an issuance of Equity Interests by a Subsidiary of the Company to the Company or to a Restricted Subsidiary; (4) the sale or lease of equipment, inventory or accounts receivable in the ordinary course of business; (5) the sale or other disposition of cash or Cash Equivalents; (6) any sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary; (7) sales of property or equipment that has become worn out, obsolete or damaged; (8) the license of patents, trademarks, copyrights, designs and know-how to third parties in the ordinary course of business; (9) the creation of Liens; (10) the sale or transfer of accounts receivable and related assets of the type specified in the definition of "Qualified Receivables Transaction" to a Receivables Subsidiary; and (11) a Restricted Payment or Permitted Investment that is permitted by Section 4.07 hereof. 2 "Attributable Debt" in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended. Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP. "Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state law for the relief of debtors. "Bank Product Agreements" means any agreement pursuant to which a bank or other financial institution agrees to provide treasury management services (including, without limitation, controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services). "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 or any duly authorized committee thereof; (2) with respect to a partnership, the Board of Directors of the general partner of the partnership or any duly authorized committee thereof; and (3) with respect to any other Person, the board or committee of such Person serving a similar function. "Broker-Dealer" has the meaning set forth in the Registration Rights Agreement. "Business Day" means any day other than a Legal Holiday. "Canadian Restricted Subsidiary" means any Restricted Subsidiary of the Company that was formed under the laws of Canada or any province of Canada. "Capital Lease Obligation" means, at the time any determination is to be made, the amount of the liability in respect of a capital lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP. "Capital Stock" means: (1) in the case of a corporation, corporate stock; (2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; 3 (3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and (4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person. "Cash Equivalents" means: (1) United States dollars and any other currency that is convertible into United States dollars without legal restrictions and which is utilized by the Company or any of its Restricted Subsidiaries in the ordinary course of its business; (2) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States is pledged in support of those securities); (3) time deposit accounts, certificates of deposit and money market deposits maturing within one year of the date of acquisition thereof, bankers' acceptances with maturities not exceeding six months and overnight bank deposits, in each case with a bank or trust company which is organized under the laws of the United States, any state thereof or any foreign country recognized by the United States, and which bank or trust company has capital, surplus and undivided profits aggregating in excess of $250.0 million (or the foreign currency equivalent thereof) and has outstanding debt which is rated "A" (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) or any money-market fund sponsored by a registered broker dealer or mutual fund distributor; (4) repurchase obligations with a term of not more than seven days 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 having one of the two highest ratings obtainable from Moody's and S&P (or by a nationally recognized rating agency or agencies if one or both of the named rating agencies cease publishing ratings of investments) and in each case maturing within one year after the date of acquisition; (6) money market 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) in the case of any Subsidiary organized or having its principal place of business outside the United States, investments denominated in the currency of the jurisdiction in which that Subsidiary is organized or has its principal place of business which are similar to the items specified in clauses (1) through (6) above, including, without limitation, any deposit with a bank that is a lender to any Restricted Subsidiary of the Company. "Certificated Notes" means definitive Notes in registered certificated form. "Change of Control" means the occurrence of any of the following: (1) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of 4 the properties or assets of the Company and its Restricted Subsidiaries taken as a whole to any "person" (as that term is defined in Section 13(d)(3) of the Exchange Act) other than one or more Permitted Holders; (2) the adoption of a plan relating to the liquidation or dissolution of the Company; (3) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any "person" (as defined above) other than a Permitted Holder, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of the Company, measured by voting power rather than number of shares; or (4) the first day on which a majority of the members of the Board of Directors of the Company are not Continuing Directors. "Clearstream" means Clearstream Banking, S.A. "Code" means the New York UCC; provided that to the extent that the Code is used to define any term in any Security Document and such term is defined differently in differing Articles of the Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, publication or priority of, or remedies with respect to, Credit Facility Liens or Senior Secured Note Liens is governed by the Uniform Commercial Code or foreign personal property security laws as enacted and in effect in a jurisdiction other than the State of New York, the term "Code" will mean the Uniform Commercial Code or such foreign personal property security laws as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions. "Collateral" means all property now owned or hereafter acquired by the Company or any Guarantor in or upon which a Lien is granted or purported to be granted to the Credit Facility Agent or the Trustee or Collateral Agent under any of the Security Documents, together with all rents, issues, profits, products, and proceeds thereof, which shall not in any event include: (1) Excluded Assets; and (2) any properties and assets in which the Collateral Agent is required to release its Liens pursuant to the provisions described in Section 10.03, provided that if such Liens are required to be released as a result of the sale, transfer or other disposition of any properties or assets of the Company or any Guarantor, such assets or properties will cease to be excluded from the Collateral if the Company or any Guarantor thereafter acquires or reacquires such assets or properties. "Collateral Agent" means U.S. Bank National Association, in it capacity as Collateral Agent under the Security Documents, together with its successors in such capacity. "Company" means Milacron Escrow Corporation, and any and all successors thereto. "Consolidated Cash Flow" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person and its Restricted Subsidiaries for such period plus: 5 (1) an amount equal to any extraordinary loss plus any net loss realized by such Person or any of its Restricted Subsidiaries in connection with an Asset Sale, to the extent such losses were deducted in computing such Consolidated Net Income; plus (2) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted in computing such Consolidated Net Income; plus (3) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued and whether or not capitalized (including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations), to the extent that any such expense was deducted in computing such Consolidated Net Income; plus (4) depreciation, amortization (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash expenses, charges, losses or other items (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses, charges, losses or other items were deducted in computing such Consolidated Net Income; plus (5) any non-recurring expenses and charges and any restructuring charges of such Person and its Restricted Subsidiaries; minus (6) any extraordinary or non-recurring items increasing such Consolidated Net Income for such period, other than the accrual of revenue in the ordinary course of business; in each case, on a consolidated basis and determined in accordance with GAAP. "Consolidated Net Income" means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that: (1) the Net Income (or loss) of any Person that is not a Restricted Subsidiary of such Person or that is accounted for by the equity method of accounting will be included only to the extent of the amount of dividends or distributions paid in cash to the specified Person or a Restricted Subsidiary of the Person; (2) the Net Income of any Restricted Subsidiary of such Person will be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders; provided, however, that if such declaration or payment of dividends or similar distributions is not permitted 6 solely by the operation of the terms of a Foreign Credit Facility permitted to be incurred by the terms of this Indenture, the Net Income of such Restricted Subsidiary may be included to the extent of the actual dividends or distributions paid to such Person during such period; and (3) the cumulative effect of a change in accounting principles will be excluded. "Continuing Directors" means, as of any date of determination, any member of the Board of Directors of the Company who: (1) was a member of such Board of Directors on the date of this Indenture; (2) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board at the time of such nomination or election; or (3) was nominated by or on behalf of a Permitted Holder if such Permitted Holder beneficially owned more than 10.0% of the Company's Voting Stock at the time of such nomination. "Corporate Trust Office of the Trustee" will be at the address of the Trustee specified in Section 13.02 hereof or such other address as to which the Trustee may give notice to the Company. "Credit Facility" means, with respect to the Company or any Restricted Subsidiary, one or more debt facilities (including, without limitation, the ABL Facility), debt securities sales arrangements or commercial paper facilities, in each case with, or sold to, banks or other institutional lenders or investors providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables), letters of credit or other Indebtedness, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part, and without limitation as to amount, terms, conditions, covenants and other provisions) from time to time, and any agreement (and related documents and instruments) governing Indebtedness incurred to refinance, in whole or in part, the borrowings and commitments then outstanding or permitted to be outstanding under such debt or successor debt, whether by the same or any other lender or investor or group of lenders or investors. "Credit Facility Agent" means, at any time in respect of any Credit Facility, the Person serving at such time as the "Agent," "Administrative Agent," "Collateral Agent," "ABL Agent" or "Collateral Trustee" under such Credit Facility or any other representative then most recently designated in accordance with the applicable provisions of the Credit Facility, together with its successors in such capacity. "Credit Facility Debt" means Indebtedness under a Qualified Credit Facility. "Credit Facility Documents" means the credit agreement with respect to the ABL Facility and any other Qualified Credit Facility pursuant to which any Credit Facility Debt is incurred, including the guaranty agreements, bank product agreements, hedging agreements, and Security Documents related thereto (other than any Security Documents that do not secure Credit Facility Obligations), as well as those other ancillary agreements as to which the Credit Facility Agent or any lender is a party or a beneficiary and all other agreements, instruments, documents and certificates executed in connection with any of the foregoing or any Qualified Credit Facility. 7 "Credit Facility Lien" means any Lien upon Credit Facility Priority Collateral granted to any holder, or representative of holders (including a Credit Facility Agent), of the Credit Facility Obligations, as security for Credit Facility Obligations. "Credit Facility Obligations" means: (1) the Credit Facility Debt and all other Obligations under any Qualified Credit Facility or any related Credit Facility Documents; and (2) all Hedging Obligations and Obligations under Bank Products Agreements; provided that the counterparty to such Hedging Obligation or the Person holding such Obligations under Bank Product Agreements is a Qualified Counterparty. "Credit Facility Priority Collateral" means all Collateral consisting of the following, other than the Excluded Assets: (1) all accounts and receivables (each as defined in Article 9 of the Code); (2) all chattel paper, including tangible chattel paper and electronic chattel paper (each as defined in Article 9 of the Code); (3) (a) all deposit accounts and money (each as defined in Article 9 of the Code) and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein and (b) all securities, security entitlements, and securities accounts (each as defined in Article 9 of the Code), in each case, to the extent constituting cash or cash equivalents or representing a claim to cash equivalents, except, in each case, for (x) any Asset Sale Proceeds Account and all deposits and other funds held therein, (y) any deposit account or money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein or any securities account and all cash and cash equivalents held therein that, in each case, constitute identifiable proceeds of Senior Secured Note Priority Collateral and (z) the Eurobond Escrow Account, if any, and all deposits and other funds held therein, but in any event and regardless of the foregoing clauses (x), (y) and (z), the cash management and lockbox account specified in the ABL Facility; (4) all inventory (as defined in Article 9 of the Code); (5) to the extent involving or governing any of the items referred to in the preceding clauses (1) through (4), all documents, general intangibles, instruments, including, without limitation, promissory notes, and letter of credit rights (each as defined in Article 9 of the Code); provided that to the extent any of the foregoing also relates to Senior Secured Note Priority Collateral, only that portion related to the items referred to in the preceding clauses (1) through (4) shall be included in the Credit Facility Priority Collateral; (6) to the extent evidencing or governing any of the items referred to in the preceding clauses (1) through (5), all supporting obligations (as defined in Article 9 of the Code); provided that to the extent any of the foregoing also relates to Senior Secured Note Priority Collateral, only that portion related to the items referred to in the preceding clauses (1) through (5) shall be included in the Credit Facility Priority Collateral; (7) all books and records (as defined in Article 9 of the Code) relating to the foregoing, including, without limitation, all books, databases, customer lists, engineer drawings and records 8 (as defined in Article 9 of the Code), whether tangible or electronic, which contain any information relating to any of the foregoing; and (8) all proceeds of any of the foregoing (as defined in Article 9 of the Code), including without limitation, all insurance proceeds, and all collateral security and guarantees given by any Person with respect to any of the foregoing; provided, however, that any Collateral, regardless of type, received in connection with a permitted disposition of or otherwise in exchange for Credit Facility Priority Collateral pursuant to the terms of the applicable Qualified Credit Facility shall be treated as Credit Facility Priority Collateral; and provided, further, that any Collateral regardless of type received in connection with a permitted disposition of or otherwise in exchange for Senior Secured Note Priority Collateral pursuant to the terms of this Indenture, shall be treated as Senior Secured Note Priority Collateral. "Currency Agreement" means, with respect to any Person, any foreign exchange contract, currency swap agreement or other similar agreement designed to protect the Person against fluctuations in currency values. "Custodian" means the Trustee, as custodian with respect to the Notes in global form, or any successor entity thereto. "Default" means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default. "Definitive Note" means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, substantially in the form of Exhibit A1 hereto except that such Note shall not bear the Global Note Legend and shall not have the "Schedule of Exchanges of Interests in the Global Note" attached thereto. "Depositary" means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provision of this Indenture. "Discharge of Credit Facility Obligations" means (1) the payment in full of the Credit Facility Obligations that are outstanding and unpaid at the time all indebtedness thereunder is paid in full including, with respect to amounts available to be drawn under outstanding letters of credit issued thereunder (or indemnities or other undertakings issued pursuant thereto in respect of outstanding letters of credit), delivery of money or backstop letters of credit in respect thereof in compliance with the terms of any Qualified Credit Facility (which shall not exceed an amount equal to 105% of the aggregate undrawn amount of such letters of credit), (2) the termination of all commitments to extend credit under the Credit Facility Documents, and (3) the delivery by the Credit Facility Agent of a written notice to the collateral agent stating that the events described in clauses (1) and (2) have occurred to the satisfaction of the holders of the Credit Facility Obligations. "Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case at the option of the holder of the Capital Stock), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the Notes mature. Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock 9 solely because the holders of the Capital Stock have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 4.07 hereof. "Domestic Borrowing Base" means: (1) 85% of the book value of all accounts receivable owned by the Company and its Domestic Restricted Subsidiaries and Canadian Restricted Subsidiaries; plus (2) 45% of the book value of all inventory owned by the Company and its Domestic Restricted Subsidiaries and Canadian Restricted Subsidiaries; provided, however, that any accounts receivable owned by a Receivables Subsidiary, or which the Company or any of its Restricted Subsidiaries has agreed to transfer to a Receivables Subsidiary, will be excluded for purposes of determining such amount. "Domestic Receivables Subsidiary" means any Receivables Subsidiary that was formed under the laws of the United States or any state of the United States or the District of Columbia or that was formed under the laws of Canada or any province of Canada. "Domestic Restricted Subsidiary" means any Restricted Subsidiary of the Company that was formed under the laws of the United States or any state of the United States or the District of Columbia. "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). "Escrow Account" means a segregated account, under the sole control of the Trustee that includes only cash, the proceeds thereof and interest earned thereon, free from all Liens other than the Lien in favor of the Trustee for the benefit of the Holders of the Notes. "Escrow Agent" U.S. Bank National Association, as escrow agent under the Escrow Agreement. "Escrow Agreement" means the Pledge and Escrow Agreement, dated as of May 26, 2004, among the Company, the Trustee and the escrow agent thereunder, relating to the Escrow Account. "Escrow Merger" means the merger of the Company with and into Milacron pursuant to the Escrow Merger Certificate, with Milacron as the surviving corporation. "Escrow Merger Certificate" means the Certificate of Ownership and Merger with respect to the Escrow Merger, to be filed with the Secretary of the State of Delaware upon expiration of the Escrow Period. "Escrow Period" means that period beginning on the date of this Indenture and ending on the date on which the funds held in the Escrow Account are released upon satisfaction of all conditions precedent to such release, as set forth in the escrow agreement and described in Section 4.21 hereof. "Escrow Redemption Date" means the date that is 31 days after the Conditions Precedent Date, or if such date is not a Business Day, the first Business Day following such date. 10 "Escrow Redemption Price" means an amount of cash equal to 101% of $219,764,250 plus interest accrued on $219,764,250 from May 26, 2004 to, but excluding, the Escrow Redemption Date, calculated using a rate of 12% per annum. "Eurobonds" means the 7.625% Guaranteed Fixed Rate Bonds due 2005 of Milacron Capital Holdings B.V. in the original aggregate principal amount of (euro)115.0 million. "Eurobond Escrow Account" means a segregated account under the sole control of the Collateral Agent, if any, that includes only cash, the proceeds thereof and interest earned thereon. "Eurobond Escrow Agreement" means an agreement, if any, between the Company and the Collateral Agent, pursuant to which the Eurobond Escrow Account, if any, is established. "Euroclear" means Euroclear Bank, S.A./N.V., as operator of the Euroclear system. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Exchange Notes" means the Notes issued in the Exchange Offer pursuant to Section 2.06(f) hereof. "Exchange Offer" has the meaning assigned to the term "Registered Exchange Offer" in the Registration Rights Agreement. "Exchange Offer Registration Statement" has the meaning set forth in the Registration Rights Agreement. "Excluded Assets" means: (1) any lease of premises used only as office space or to warehouse inventory; (2) any lease, license, permit, franchise, power, authority or right if, to the extent that and for as long as (a) the grant of a security interest therein constitutes or would result in the abandonment, invalidation or unenforceability of such lease, license, permit, franchise, power, authority or right or the termination of, breach of or a default under the lease, instrument or agreement by which such lease, license, permit, franchise, power, authority or right is governed and (b) such abandonment, invalidation, unenforceability, breach, termination or default is not rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the New York UCC (or any successor provision) of any relevant jurisdiction or any other applicable law (including the United States bankruptcy code) or principles of equity; provided, however, that (i) such lease, license, permit, franchise, power, authority or right will be an Excluded Asset only to the extent and for as long as the conditions set forth in clauses (a) and (b) in this definition are and remain satisfied and to the extent such assets otherwise constitute Collateral, will cease to be an Excluded Asset, and will become subject to the Senior Secured Note Lien, immediately and automatically at such time as such conditions cease to exist, including by reason of any waiver or consent under the applicable instrument or agreement, and (ii) the proceeds of any sale, lease or other disposition of any such lease, license, permit, franchise, power, authority or right that is or becomes an Excluded Asset shall not be an Excluded Asset and shall at all times be and remain subject to the Senior Secured Note Lien; (3) assets or property (a) located outside of the United States (other than assets or property of a Canadian Restricted Subsidiary located in Canada) or (b) of any Canadian 11 Restricted Subsidiary other than (i) those of the type described in clauses (1) through (4) of the definition of Credit Facility Priority Collateral and (ii) the proceeds of the Credit Facility Priority Collateral described in the preceding clause (i); (4) deposit accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of salaried employees; (5) deposit accounts held by Oak International, Inc. at Citizens Bank and Nickerson Machinery Chicago Inc. at Fleet National Bank; (6) any real property acquired after the date of this Indenture with a fair market value of less than $750,000 in the case of a fee interest or with an annual rent of less than $100,000 in the case of a leasehold interest; (7) Capital Stock of any Subsidiary of the Company or any Guarantor formed under the laws of a jurisdiction other than the United States or any State of the United States or the District of Columbia (a "Foreign Stock Subsidiary") in excess of 65% of the outstanding Capital Stock of such Foreign Stock Subsidiary; (8) Capital Stock of any non-wholly owned Foreign Stock Subsidiary to the extent that a grant of a Lien therein would conflict with the terms of any organizational document of, agreement governing investments in, or the law of the jurisdiction of formation of, such Foreign Stock Subsidiary; (9) Capital Stock of Milacron Plastics Machinery (Jiangyin) Co., LTD, D-M-E-(Hong Kong) Limited, Japan D-M-E Corporation, Ferromatix India Limited and any Immaterial Subsidiary; (10) real estate located at 3025 Disney Street, Cincinnati, Ohio 45209 and real estate located at 10501 High M52, Manchester, Michigan 48158; (11) assets or property of Milacron Capital Holdings B.V.; and (12) (a) other personal property (other than deposit accounts, letter of credit rights, intellectual property and proceeds of Collateral) in which a security interest cannot be perfected by the filing of a financing statement under the Uniform Commercial Code or PPSA or similar Canadian legislation and (b) without duplication, motor vehicles, that have, in the aggregate for all such property and motor vehicles, a fair market value (as determined in good faith by the Company) not exceeding $1,000,000. In addition, any Collateral consisting of any Capital Stock or other securities of any Subsidiary of the Company shall be limited at any time to that portion of such Capital Stock or other securities which value (defined as the principal amount, par value, book value as carried by the Company or market value, whichever is greatest), when considered in the aggregate with all other Capital Stock or other securities of such Subsidiary subject to a security interest under this indenture, does not exceed 19.99% of the principal amount of the then outstanding Notes issued, and the portion of any such Capital Stock or other securities of such Subsidiary in excess of such percentage will be deemed Excluded Assets; provided, however, in the event that Rule 3-16 of Regulation S-X promulgated by the SEC is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation or any other law, rule or regulation is adopted, which would require) the filing with the SEC (or any other governmental agency) of separate financial statements of any Subsidiary of the Company due to such Subsidiary's Capital Stock 12 or other securities securing the Notes, then the Capital Stock or other securities of such Subsidiary (the "Excluded Securities") shall automatically be deemed to be Excluded Assets, but only for so long as and to the extent necessary to not be subject to such requirement; provided further, however, that in such event, the Security Documents may be amended or modified, without the consent of any Holder of Notes, to the extent necessary to release the security interests in the Excluded Securities that are deemed to constitute Excluded Assets. "Excluded Securities" meaning provided to such term in the definition of Excluded Assets. "Exercise of Remedies" means: (1) the taking of any action to enforce or realize upon any Lien, including the institution of any foreclosure proceedings or the noticing of any public or private sale pursuant to Article 9 of the Code; (2) the exercise of any right or remedy provided to a secured creditor on account of a Lien under any of the Credit Facility Documents or Senior Secured Note Documents, under applicable law, in an insolvency or liquidation proceeding or otherwise, including the election to retain any of the Collateral in satisfaction of a Lien; (3) the taking of any action or the exercise of any right or remedy in respect of the collection on, set off against, marshaling of, or foreclosure on the Collateral or the proceeds thereof; (4) the appointment of a receiver, receiver and manager or interim receiver of all or part of the Collateral; (5) the sale, lease, license, or other disposition of all or any portion of the Collateral by private or public sale or any other means permissible under applicable law; (6) the exercise of any other right of a secured creditor under Part 6 of Article 9 of the Code; (7) the exercise of any voting rights relating to any Capital Stock included in the Collateral; and (8) the delivery of any notice, claim or demand relating to the Collateral to any Person (including any securities intermediary, depository bank or landlord) in possession or control of any Collateral. For avoidance of doubt, filing a proof of claim in bankruptcy court or seeking adequate protection shall not be deemed to be an Exercise of Remedies. "Existing Credit Facility" means the Amended and Restated Financing Agreement, dated as of March 31, 2004, among Milacron, certain Subsidiaries of Milacron, as borrowers, certain Subsidiaries of Milacron, as guarantors, the lenders from time to time party thereto and Credit Suisse First Boston, acting through its Cayman Islands Branch, as Administrative Agent and Collateral Agent. "Existing Indebtedness" means Indebtedness of the Company and its Restricted Subsidiaries (other than Indebtedness under the Existing Credit Facility, the Series B Notes and the ABL Facility) in existence on the date of this Indenture, until such amounts are repaid. 13 "Existing Preferred Stock" means Milacron's 4% Cumulative Preferred Stock. "Fixed Charge Coverage Ratio" means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such Person and its Restricted Subsidiaries for such period to the Fixed Charges of such Person and its Restricted Subsidiaries for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, Guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated giving pro forma effect to such incurrence, assumption, Guarantee, repayment, repurchase or redemption of Indebtedness, or such issuance, repurchase or redemption of preferred stock, and the use of the proceeds therefrom as if the same had occurred at the beginning of the applicable four-quarter reference period. In addition, for purposes of calculating the Fixed Charge Coverage Ratio: (1) acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers or consolidations and including any related financing transactions, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date will be given pro forma effect as if they had occurred on the first day of the four-quarter reference period and Consolidated Cash Flow for such reference period will be calculated on a pro forma basis in accordance with Regulation S-X under the Securities Act; (2) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, will be excluded; (3) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, will be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its Restricted Subsidiaries following the Calculation Date; (4) any Person that is a Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four-quarter period; (5) any Person that is not a Restricted Subsidiary on the Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four-quarter period; and (6) if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will 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 Obligation applicable to such Indebtedness if such Hedging Obligation has a remaining term as at the Calculation Date in excess of 12 months). "Fixed Charges" means, with respect to any specified Person for any period, the sum, without duplication, of: 14 (1) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations; plus (2) the consolidated interest of such Person and its Restricted Subsidiaries that was capitalized during such period; plus (3) any interest expense on Indebtedness of another Person that is Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon; plus (4) the product of (a) all dividends, paid, whether or not in cash, on any series of preferred stock of such Person or any of its Restricted Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of the Company (other than Disqualified Stock) or to the Company or a Restricted Subsidiary of the Company, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP. "Foreign Borrowing Base" means, as of any date, an amount equal to 80% of the book value of all accounts receivable owned by Foreign Restricted Subsidiaries of the Company; provided, however, that any accounts receivable owned by a Receivables Subsidiary, or which the Company or any of its Restricted Subsidiaries has agreed to transfer to a Receivables Subsidiary, will be excluded for purposes of determining such amount. "Foreign Credit Facility" means, with respect to any Foreign Restricted Subsidiary, one or more working capital debt facilities, in each case with banks or other institutional lenders providing for revolving credit loans and letters of credit, in each case as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part, and without limitation as to amount, terms, conditions, covenants and other provisions) from time to time. "Foreign Receivables Subsidiary" means any Receivables Subsidiary that is not a Domestic Receivables Subsidiary. "Foreign Restricted Subsidiaries" means those Restricted Subsidiaries that are not Domestic Restricted Subsidiaries or Canadian Restricted Subsidiaries. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, as in effect on the date of this Indenture. "Glencore" means Glencore Finance AG. 15 "Global Note Legend" means the legend set forth in Section 2.06(g)(2) hereof, which is required to be placed on all Global Notes issued under this Indenture. "Global Notes" means, individually and collectively, each of the Restricted Global Notes and the Unrestricted Global Notes deposited with or on behalf of and registered in the name of the Depository or its nominee, substantially in the form of Exhibit A1 hereto and that bears the Global Note Legend and that has the "Schedule of Exchanges of Interests in the Global Note" attached thereto, issued in accordance with Section 2.01, 2.06(b)(3), 2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof. "Government Securities" means direct obligations of, or obligations guaranteed by, the United States of America for the payment of which guarantees or obligations the full faith and credit of the United States is pledged. "Guarantee" means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business, direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness. "Guarantors" means each of: (1) the Domestic Restricted Subsidiaries; (2) the Canadian Restricted Subsidiaries; and (3) any other Subsidiary that executes a Note Guarantee in accordance with the provisions of this Indenture, and their respective successors and assigns, in each case, until the Note Guarantee of such Person has been released in accordance with the provisions of this Indenture. "Hedging Obligations" means, with respect to any specified Person, the obligations of such Person under: (1) interest rate swap agreements (whether from fixed to floating or from floating to fixed), interest rate cap agreements and interest rate collar agreements; and (2) other agreements or arrangements designed to protect such Person against fluctuations in interest rates, currency exchange rates or commodity prices. "Holder" means a Person in whose name a Note is registered on the Registrar's books. "IAI Global Note" means a Global Note substantially in the form of Exhibit A1 hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold to Institutional Accredited Investors. "Immaterial Subsidiary" means, (a) as of any date, any Restricted Subsidiary whose total assets, as of that date, are less than $100,000 and whose total revenues for the most recent 12-month period do not exceed $100,000; provided that a Restricted Subsidiary will not be considered to be an Immaterial Subsidiary if it, directly or indirectly, guarantees or otherwise provides direct credit support for any Indebtedness of the Company and (b) at any time prior to the expiration of the Escrow Period, Milacron 16 Commercial Corp.; provided that Milacron Commercial Corp. will no longer constitute and Immaterial Subsidiary after the expiration of the Escrow Period unless at that time it meets the criteria of the preceding clause (a). "Indebtedness" means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent: (1) in respect of borrowed money; (2) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof); (3) in respect of banker's acceptances; (4) representing Capital Lease Obligations; (5) representing the balance deferred and unpaid of the purchase price of any property or services, except any such balance that constitutes an accrued expense or trade payable; or (6) representing any Hedging Obligations, if and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a liability upon the face of a balance sheet of the specified Person prepared in accordance with GAAP. The term "Indebtedness" includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the Guarantee by the specified Person of any Indebtedness of any other Person. In addition, for the purpose of avoiding duplication in calculating the outstanding principal amount of Indebtedness for purposes of Section 4.09 hereof, Indebtedness arising solely by reason of the existence of a Lien to secure other Indebtedness permitted to be incurred under Section 4.09 hereof will not be considered incremental Indebtedness. Indebtedness shall not include the obligations of any Person (1) resulting solely from the endorsement of negotiable instruments for collection in the ordinary course of business or (2) resulting from postclosing payment adjustments to which the seller may become entitled in connection with the purchase by the Company or any Restricted Subsidiary of any business, to the extent such payment is determined by a final closing financial statement or such payment depends on the performance of such business after the closing; provided that at the time of closing, the amount of any such payment is not determinable and, to the extent such payment thereafter becomes fixed and determined, the amount is paid within 60 days thereafter. "Indenture" means this Indenture, as amended or supplemented from time to time. "Indirect Participant" means a Person who holds a beneficial interest in a Global Note through a Participant. "Initial Notes" means the first $225,000,000 aggregate principal amount of Notes issued under this Indenture on the date hereof. 17 "Initial Purchasers" means Credit Suisse First Boston LLC, J.P. Morgan Securities Inc. and Lazard Freres & Co. LLC. "insolvency or liquidation proceeding" means: (1) any case, action or proceeding before any court or other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (2) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case covered by clauses (1) and (2) undertaken under the United States Federal, State or foreign law, including the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada) and the Companies' Creditors Arrangement Act (Canada). "Institutional Accredited Investor" means an institution that is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act, who are not also QIBs. "Intercreditor Agreement" means that agreement to be dated on or before the date of the Escrow Merger, among JPMorgan Chase Bank, as ABL agent and U.S. Bank National Association, as term agent. "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 (i) commission, travel and similar advances to officers and employees made in the ordinary course of business or (ii) receivables created or acquired in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. If the Company or any Restricted Subsidiary of the Company sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary of the Company, the Company will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Company's Investments in such Restricted Subsidiary that were not sold or disposed of in an amount determined as provided in the final paragraph of Section 4.07 hereof. The acquisition by the Company or any Restricted Subsidiary of the Company of a Person that holds an Investment in a third Person will be deemed to be an Investment by the Company or such Restricted Subsidiary in such third Person in an amount equal to the portion of the fair market value (determined as provided in the final paragraph Section 4.07 hereof) of the Investments held by the acquired Person in such third Person in proportion to the percentage of the aggregate Equity Interests of such acquired Person held by the Company or such Restricted Subsidiary. Except as otherwise provided for herein, the amount of an Investment will be its fair value at the time the Investment is made without giving effect to subsequent changes in value. "Legal Holiday" means a Saturday, a Sunday or a day on which banking institutions in the City of New York or at a place of payment are authorized by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on such payment for the intervening period. "Letter of Transmittal" means the letter of transmittal to be prepared by the Company and sent to all Holders of the Notes for use by such Holders in connection with the Exchange Offer. "Lien" means, with respect to any asset, any mortgage, lien, pledge, hypothec, 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. 18 "Liquidated Damages" means all "Additional Interest" as defined under the Registration Rights Agreement then owing pursuant to Section 6 of the Registration Rights Agreement. "Milacron" Milacron Inc., a Delaware corporation "Mizuho" means Mizuho International plc. "Moody's" means Moody's Investors Service, Inc. "Net Collateral Proceeds" means the aggregate cash proceeds and other consideration received by the Company or any of its Restricted Subsidiaries in respect of any Sale of Senior Secured Note Priority Collateral (including, without limitation, any cash received upon the sale or other disposition of any noncash consideration received in any such Sale of Senior Secured Note Priority Collateral, but only as and when received), net of (1) all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Sale of Senior Secured Note Priority Collateral, (2) the direct costs relating to such Sale of Senior Secured Note Priority Collateral, including, without limitation, legal, accounting and investment banking fees, sales commissions, recording fees, title transfer fees, appraiser fees, and any relocation expenses incurred as a result of such Sale of Senior Secured Note Priority Collateral, and taxes paid or payable as a result of such Sale of Senior Secured Note Priority Collateral, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, (3) amounts required to be applied to the repayment of Indebtedness secured by a Permitted Prior Lien on the asset or assets that were the subject of such Sale of Senior Secured Note Priority Collateral, (4) expenses and fees in connection with obtaining any required consents to such Sale of Senior Secured Note Priority Collateral from lenders or holders of Indebtedness or other third parties (unless such expenses and fees consist of the repayment of Indebtedness to any such Person), and (5) any reserve for adjustment in respect of the sale price of such asset or assets or for retained liabilities in connection with such Sale of Senior Secured Note Priority Collateral established in accordance with GAAP. "Net Income" means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of preferred stock dividends, excluding, however: (1) any gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with: (a) any Asset Sale; or (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and (2) any extraordinary gain or loss, together with any related provision for taxes on such extraordinary gain or loss. "Net Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale (other than any Sale of Senior Secured Note Priority Collateral) (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any such Asset Sale, but only as and when received), net of (1) all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Asset Sale, (2) the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, sales commissions, recording fees, title transfer fees, appraiser fees, and any relocation expenses incurred as a result of such Asset Sale, and taxes paid or payable as a result of such Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, (3) amounts required to be 19 applied to the repayment of Indebtedness, other than Indebtedness under a Credit Facility, secured by a Lien on the asset or assets that were the subject of such Asset Sale, (4) expenses and fees in connection with obtaining any required consents to such Asset Sales from lenders or holders of Indebtedness or other third parties (unless such expenses and fees consist of the repayment of Indebtedness to any such Person), and (5) any reserve for adjustment in respect of the sale price of such asset or assets or for retained liabilities in connection with such Asset Sale established in accordance with GAAP. "New York UCC" means the Uniform Commercial Code, as from time to time in effect in the State of New York. "Non-Recourse Debt" means Indebtedness: (1) as to which neither the Company nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender; (2) no default with respect to which (including any rights that the holders of the Indebtedness may have to take enforcement action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness of the Company or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment of the Indebtedness to be accelerated or payable prior to its stated maturity; and (3) as to which the lenders have been notified in writing (which may be by the terms of the instrument evidencing such Indebtedness) that they will not have any recourse to the stock (other than the stock of an Unrestricted Subsidiary pledged by the Company or any of its Unrestricted Subsidiaries) or assets of the Company or any of its Restricted Subsidiaries. "Non-U.S. Person" means a Person who is not a U.S. Person. "Note Guarantee" means the Guarantee by each Guarantor of the Company's obligations under this Indenture and the Notes, executed pursuant to the provisions of this Indenture. "Note Purchase Agreement" means the Note Purchase Agreement with respect to the Series A Notes and the Series B Notes, dated as of March 12, 2004, among Milacron and Glencore and Mizuho, as amended on April 5, 2004. "Notes" has the meaning assigned to it in the preamble to this Indenture. The Initial Notes and the Additional Notes shall be treated as a single class for all purposes under this Indenture, and unless the context otherwise requires, all references to the Notes shall include the Initial Notes and any Additional Notes. "Obligations" means any principal (including reimbursement obligations with respect to letters of credit whether or not drawn), interest (including all interest accrued thereon after the commencement of any insolvency or liquidation proceeding at the rate, including any applicable post-default rate, even if such interest is not enforceable, allowable or allowed as a claim in such proceeding), premium (if any), fees, indemnifications, reimbursements, expenses and other liabilities payable under the documentation governing any Indebtedness, and in the case of the ABL Facility, all obligations thereunder. 20 "Obligor" means the Company, the Guarantors and each other Subsidiary of the Company that has granted to the Collateral Agent a Lien upon any of the Collateral as security for a Senior Secured Note Obligation. "Offering Circular" means the Company's offering circular dated May 12, 2004, relating to the issuance of the Notes. "Officer" means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary or any Vice-President of such Person. "Officers' Certificate" means a certificate signed on behalf of the Company by two Officers of the Company, one of whom must be the principal executive officer, the principal financial officer, the treasurer or the principal accounting officer of the Company, that meets the requirements of Section 13.05 hereof. "Opinion of Counsel" means an opinion from legal counsel who is reasonably acceptable to the Trustee, that meets the requirements of Section 13.05 hereof. The counsel may be an employee of or counsel to the Company, any Subsidiary of the Company or the Trustee. "Participant" means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively (and, with respect to DTC, shall include Euroclear and Clearstream). "Permitted Asset" means property, plant and equipment used or to be used in the business of the Company or any of its Domestic Restricted Subsidiaries and which will be owned upon acquisition by the Company or a Domestic Restricted Subsidiary. "Permitted Business" means any business similar in nature to any business conducted by the Company and its Restricted Subsidiaries on the date of this Indenture and any business reasonably ancillary, incidental, complementary or related to, or a reasonable extension, development or expansion of, the business conducted by the Company and its Restricted Subsidiaries on the date of this Indenture, in each case as determined by the Board of Directors of the Company. "Permitted Holder" means each of Mizuho and Glencore and: (1) any controlling equity holder, majority-owned Subsidiary, or immediate family member (in the case of an individual) of either Mizuho or Glencore; and (2) any trust, corporation, partnership, limited liability company or other entity, the beneficiaries, stockholders, partners, members, owners or Persons beneficially holding a majority controlling interest of which consist of any one or more of Mizuho, Glencore and/or such Persons referred to in the immediately preceding clause (1). "Permitted Investments" means: (1) any Investment in the Company or in a Restricted Subsidiary of the Company that is a Guarantor; 21 (2) any Investment by the Company or a Guarantor in a Restricted Subsidiary of the Company that is not a Guarantor in an amount that, when taken together with all Investments outstanding under clause (5)(b) below, does exceed $15.0 million at any one time outstanding; (3) any Investment by a Restricted Subsidiary that is not a Guarantor in another Restricted Subsidiary that is not a Guarantor; (4) any Investment in Cash Equivalents; (5) any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment: (a) such Person becomes a Restricted Subsidiary of the Company and a Guarantor or such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary of the Company that is a Guarantor; (b) if the Investment is made by the Company or a Guarantor, such Person becomes a Restricted Subsidiary of the Company that is not a Guarantor or such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, a Restricted Subsidiary of the Company that is not a Guarantor, so long as such Investment, when taken together with all Investments outstanding under clause (2) above, does exceed $15.0 million at any one time outstanding; or (c) if the Investment is made by a Restricted Subsidiary of the Company that is not a Guarantor, such Person becomes a Restricted Subsidiary of the Company or such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, a Restricted Subsidiary of the Company; (6) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 4.10 hereof"; (7) any Investment to the extent made in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Company; (8) any Investments received in compromise of obligations of such persons incurred in the ordinary course of trade creditors or customers that were incurred in the ordinary course of business, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer; (9) Hedging Obligations; (10) loans and advances to employees made in the ordinary course of business in an amount not to exceed $1.0 million; (11) advances, loans or extensions of credit to customers or suppliers in the ordinary course of business by the Company or any of its Restricted Subsidiaries; 22 (12) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent obligations of, and other disputes with, customers and suppliers arising in the ordinary course of business; (13) Investments in any Person to the extent such Investment existed on the date of this Indenture and any Investment that replaces, refinances or refunds such an Investment, provided that the new Investment is in an amount that does not exceed that amount replaced, refinanced or refunded and is made in the same Person as the Investment replaced, refinanced or refunded; (14) Investments in prepaid expenses, negotiable instruments held for collection and lease, utility and workers' compensation, performance and other similar deposits; (15) transactions (other than loans or advances to employees) pursuant to compensation, employee benefit or other indemnity arrangements with officers, directors and employees of Milacron or any of its Restricted Subsidiaries entered into in the ordinary course of business; (16) Investments consisting of non-cash consideration received in the form of securities, notes or similar obligations in connection with dispositions of obsolete or worn out assets permitted pursuant to this Indenture in an aggregate amount not to exceed $5.0 million; (17) the acquisition by a Receivables Subsidiary in connection with a Qualified Receivables Transaction of Equity Interests of a trust or other Person established by the Receivables Subsidiary to effect such Qualified Receivables Transaction; and any other Investment by the Company or a Restricted Subsidiary of the Company in a Receivables Subsidiary or any Investment by a Receivables Subsidiary in any other Person in connection with a Qualified Receivables Transaction; provided that such other Investment is in the form of a note or other instrument that the Receivables Subsidiary or other Person is required to repay as soon as practicable from available cash collections less amounts required to be established as reserves pursuant to contractual agreements with entities that are not Affiliates of the Company entered into as part of a Qualified Receivables Transaction; and (18) other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (18) since the date of this Indenture, that are at the time outstanding not to exceed $20.0 million. "Permitted Liens" means: (1) Liens on Collateral of the Company and any Restricted Subsidiary securing (a) Credit Facility Debt incurred under clause (1) of Section 4.09(b) hereof, (b) any Hedging Obligations that constitute Credit Facility Obligations and (c) other Credit Facility Obligations not constituting Credit Facility Debt; (2) Liens on the Escrow Account created pursuant to the Escrow Agreement securing, equally and ratably, the Senior Secured Note Obligations and Liens created pursuant to the Security Documents securing, equally and ratably, the Senior Secured Note Obligations with respect to up to $275.0 million aggregate principal amount of Notes at any one time outstanding, together with all other Senior Secured Note Obligations; 23 (3) Liens securing Indebtedness under Foreign Credit Facilities permitted by clause (2) of Section 4.09(b) hereof and related Hedging Obligations, in each case covering only the assets of Foreign Restricted Subsidiaries; (4) Liens (not securing Credit Facility Obligations) in favor of the Company or the Guarantors; (5) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with the Company or any Subsidiary of the Company; provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with the Company or the Subsidiary; (6) Liens on property existing at the time of acquisition of the property by the Company or any Subsidiary of the Company, provided that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any other assets; (7) Liens to secure the performance of bids, tenders, leases, contracts (other than the payment of money), statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business; (8) Liens to secure Indebtedness (including Capital Lease Obligations) permitted by clause (5) of Section 4.09(b) covering only the assets acquired with such Indebtedness; (9) Liens (other than Credit Facility Liens and Senior Secured Note Liens) existing immediately after the expiration of the Escrow Period and consummation of the Escrow Merger; (10) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded; provided that any reserve or other appropriate provision as is required in conformity with GAAP has been made therefor; (11) Liens incurred, created or assumed in connection with the refinancing of any Indebtedness, Attributable Debt or other Obligations secured by any Liens permitted at any time to be incurred, created or assumed by this Indenture; provided that (a) the new Lien shall be limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to such property or proceeds or distributions thereof); and (b) the Indebtedness secured by the new Lien is not increased to any amount greater that the sum of (x) the outstanding principal amount or, if greater, committed amount of the permitted refinancing Indebtedness and (y) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing; (12) Liens on assets of the Company or a Receivables Subsidiary incurred in connection with a Qualified Receivables Transaction; 24 (13) landlords', carriers', warehousemen's, mechanics', materialmen's, repairmen's and other like Liens imposed by law, arising in the ordinary course of business and for sums not yet delinquent or being contested in good faith; (14) pledges and deposits made in the ordinary course of business in compliance with workers' compensation, unemployment insurance and other social security laws or regulations; (15) Liens in favor of collecting or payor banks consisting of rights of set-off with respect to money or instruments of the Company or any of its Restricted Subsidiaries on deposit with or in possession of such bank and arising by operation of law; (16) judgment Liens in respect of judgments that do not constitute an Event of Default; (17) any interest or title of a lessor or sublessor in the property subject to any lease or sublease entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business and covering only the assets so leased (other than a Capital Lease Obligation or a lease entered into as part of a sale and leaseback transaction); (18) easements, rights of way, zoning and similar restrictions incurred in the ordinary course of business, which do not in the aggregate materially impair the value of the Company's and its Restricted Subsidiaries' property, when taken as a whole; (19) Liens constituting licenses of intellectual property in the ordinary course of business; and (20) Liens on assets of Unrestricted Subsidiaries that secure Non-Recourse Debt of Unrestricted Subsidiaries. "Permitted Prior Liens" means (a) all Liens described in clauses (5), (6), (8), (9) or (13) of the definition of "Permitted Liens" or in clause (11) thereof in respect of Permitted Prior Liens and (b) any other Liens that are required by law or are not voluntarily granted and arise by operation of law, to the extent entitled by law to priority over the security interests granted by the Security Documents. "Permitted Refinancing Indebtedness" means any Indebtedness of the Company or any of its Restricted Subsidiaries issued to refinance Indebtedness of the Company or any of its Restricted Subsidiaries (other than intercompany Indebtedness); provided that: (1) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness being refinanced (plus all accrued interest on the Indebtedness and the amount of all expenses and premiums incurred in connection therewith); (2) such Permitted Refinancing Indebtedness has a final maturity date no earlier than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being refinanced; (3) if the Indebtedness being refinanced is subordinated in right of payment to the Notes, such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the Notes on terms at least as favorable to the Holders of Notes as those contained in the documentation governing the Indebtedness being refinanced; 25 (4) if the Indebtedness being refinanced is secured, the Liens securing such Permitted Refinancing Indebtedness do not extend to or cover any property or assets of the Company or any of its Subsidiaries not securing the Indebtedness so refinanced (other than improvements or accessions to such property); and (5) such Indebtedness is incurred either by the Company, a Guarantor or by the Restricted Subsidiary who is the obligor on the Indebtedness being refinanced. "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity. "Private Exchange Notes" has the meaning assigned to "Private Exchange Securities" in the Registration Rights Agreement. "Private Placement Legend" means the legend set forth in Section 2.06(g)(1) hereof to be placed on all Notes issued under this Indenture except where otherwise permitted by the provisions of this Indenture. "QIB" means a "qualified institutional buyer" as defined in Rule 144A. "Qualified Counterparty" means, with respect to any Hedging Obligations or Obligations under Bank Product Agreements, any counterparty that, at the time the Hedging Obligation was incurred or the applicable Bank Product Agreement was entered into: (1) is a lender under a qualified Credit Facility or any Affiliate of such a lender; or (2) enters into an irrevocable written agreement to be bound by the provisions of the Intercreditor Agreement with respect to its liens on the Credit Facility Priority Collateral, and which, in each case, appoints the applicable Credit Facility Agent to act as its agent with respect to such liens on the Credit Facility Priority Collateral. "Qualified Credit Facility" means any Credit Facility pursuant to which credit shall be extended only to the Company or one of its Restricted Subsidiaries and in respect of which the related Credit Facility Agent has become a party to the Intercreditor Agreement on behalf of the lenders under the Qualified Credit Facility in which it has agreed on behalf of such lenders and on its own behalf to be subject to such Intercreditor Agreement on the same terms and in the same capacity as the lenders and the Credit Facility Agent for the ABL Facility. "Qualified Equity Issuance" means any primary public offering or private placement to any Person of Capital Stock of the Company. "Qualified Receivables Transaction" means any transaction or series of transactions entered into by the Company or any of its Restricted Subsidiaries pursuant to which the Company or any of its Restricted Subsidiaries sells, conveys or otherwise transfers to (1) a Receivables Subsidiary (in the case of a transfer by the Company or any of its Restricted Subsidiaries) and (2) any other Person (in the case of a transfer by a Receivables Subsidiary), or grants a security interest in, any accounts receivable (whether now existing or arising in the future) of the Company or any of its Restricted Subsidiaries, and any assets related thereto including, without limitation, all collateral securing such accounts receivable, all contracts and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts 26 receivable and other assets which are customarily transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving accounts receivable. "Receivables Subsidiary" means a Wholly Owned Restricted Subsidiary of the Company which engages in no activities other than in connection with the financing of accounts receivable and which is designated by the Board of Directors of the Company (as provided below) as a Receivables Subsidiary: (1) no portion of the Indebtedness or any other Obligations (contingent or otherwise) of which: (a) is guaranteed by the Company or any Restricted Subsidiary of the Company (excluding guarantees of Obligations (other than the principal of, and interest on, Indebtedness) pursuant to customary representations, warranties, covenants and indemnities in connection with a Qualified Receivables Transaction); (b) is recourse to or obligates the Company or any Restricted Subsidiary of the Company in any way other than pursuant to customary representations, warranties, covenants and indemnities in connection with a Qualified Receivables Transaction; or (c) subjects any property or asset of the Company or any Restricted Subsidiary of the Company (other than accounts receivable and related assets as provided in the definition of "Qualified Receivables Transaction"), directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to customary representations, warranties, covenants and indemnities in connection with a Qualified Receivables Transaction; (2) with which neither the Company nor any Restricted Subsidiary of the Company has any material contract, agreement, arrangement or understanding other than on terms no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company, other than customary fees payable in connection with servicing accounts receivable; and (3) with which neither the Company nor any Restricted Subsidiary of the Company has any obligation to maintain or preserve such Restricted Subsidiary's financial condition or cause such Restricted Subsidiary to achieve certain levels of operating results. Any such designation by the Board of Directors of the Company will be evidenced to the Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions. "Registration Rights Agreement" means the Registration Rights Agreement, dated as of May 26, 2004, between the Company and the other parties named on the signature pages thereof, as such agreement may be amended, modified or supplemented from time to time and, with respect to any Additional Notes, one or more registration rights agreements between the Company and the other parties thereto, as such agreement(s) may be amended, modified or supplemented from time to time, relating to rights given by the Company to the purchasers of Additional Notes to register such Additional Notes under the Securities Act. "Registration Default" has the meaning set forth in the Registration Rights Agreement. "Regulation S" means Regulation S promulgated under the Securities Act. 27 "Regulation S Global Note" means a Regulation S Temporary Global Note or Regulation S Permanent Global Note, as appropriate. "Regulation S Permanent Global Note" means a permanent Global Note in the form of Exhibit A1 hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of the Depositary or its nominee, issued in a denomination equal to the outstanding principal amount of the Regulation S Temporary Global Note upon expiration of the Restricted Period. "Regulation S Temporary Global Note" means a temporary Global Note in the form of Exhibit A2 hereto deposited with or on behalf of and registered in the name of the Depositary or its nominee, issued in a denomination equal to the outstanding principal amount of the Notes initially sold in reliance on Rule 903 of Regulation S. "Responsible Officer," when used with respect to the Trustee, means any officer within the Corporate Trust Administration of the Trustee (or any successor group of the Trustee) or any other officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. "Restricted Definitive Note" means a Definitive Note bearing the Private Placement Legend. "Restricted Global Note" means a Global Note bearing the Private Placement Legend. "Restricted Investment" means an Investment other than a Permitted Investment. "Restricted Period" means the 40-day distribution compliance period as defined in Regulation S. "Restricted Subsidiary" of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary. "Rule 144" means Rule 144 promulgated under the Securities Act. "Rule 144A" means Rule 144A promulgated under the Securities Act. "Rule 903" means Rule 903 promulgated under the Securities Act. "Rule 904" means Rule 904 promulgated under the Securities Act. "Sale of Senior Secured Note Priority Collateral" means an Asset Sale to the extent involving assets, rights or other property that constitutes Senior Secured Note Priority Collateral under the Security Documents. "S&P" means Standard & Poor's Ratings Group. "SEC" means the Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended. "Security Documents" means all security agreements, pledge agreements, collateral assignments, mortgages, collateral agency agreements, control agreements, deeds of trust or other grants or transfers for security executed and delivered by the Company or any other Obligor creating (or purporting to 28 create) a Lien upon Collateral in favor of the Collateral Agent or a Credit Facility Agent, as applicable, in each case, as amended, modified, renewed, restated or replaced, in whole or in part, from time to time, in accordance with its terms. "Senior Secured Note Documents" means this Indenture, the Notes, the Exchange Notes, the Note Guarantees and the Security Documents (other than any Security Documents that do not secure Senior Secured Note Obligations). "Senior Secured Note Lien" means a Lien granted by a security document to the Collateral Agent upon any property of the Company or any other Obligor to secure Senior Secured Note Obligations. "Senior Secured Note Obligations" means the Notes (including all Exchange Notes therefor), the Note Guarantees and all other Obligations of any Obligor under the Senior Secured Note Documents. "Senior Secured Note Priority Collateral" means all Collateral, other than the Credit Facility Priority Collateral. "Series A Notes" means Milacron's $30.0 million aggregate principal amount of 20% Secured Step-Up Series A Notes due 2007. "Series B Notes" means Milacron's $70.0 million aggregate principal amount of 20% Secured Step-Up Series B Notes due 2007. "Series B Preferred Stock" means Milacron's 6.0% Series B Convertible Preferred Stock to be issued as contemplated by the Note Purchase Agreement. "Shelf Registration Statement" means the Shelf Registration Statement as defined in the Registration Rights Agreement. "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. "Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof. "Subsidiary" means, with respect to any specified Person: (1) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and (2) any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are that Person or one or more Subsidiaries of that Person (or any combination thereof). 29 "TIA" means the Trust Indenture Act of 1939, as amended (15 U.S.C. Sections 77aaa-77bbbb). "Treasury Rate" means the yield to maturity at a time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) which has become publicly available at least two business days prior to the Make-Whole Redemption Date (or, if such Statistical Release is no longer published, any publicly available source with similar market data)) most nearly equal to the period from the Make-Whole Redemption Date to May 15, 2011, provided, however, that if the period from the Make-Whole Redemption Date to May 15, 2011 is not equal to the constant maturity of a United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the Make-Whole Redemption Date to May 15, 2011 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used. "Trustee" means U.S. Bank National Association until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder. "Unrestricted Definitive Note" means a Definitive Note that does not bear and is not required to bear the Private Placement Legend. "Unrestricted Global Note" means a Global Note that does not bear and is not required to bear the Private Placement Legend. "Unrestricted Subsidiary" means any Subsidiary of the Company that is designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a resolution of the Board of Directors of the Company, and any Subsidiary of an Unrestricted Subsidiary, but only to the extent that each such Subsidiary: (1) has no Indebtedness other than Non-Recourse Debt; (2) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company; (3) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of operating results; and (4) has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any of its Restricted Subsidiaries. Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will be evidenced to the Trustee by delivering to the Trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the preceding conditions and was permitted by Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any 30 Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such date and, if such Indebtedness is not permitted to be incurred under Section 4.09 hereof, the Company will be in default of such covenant. The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation will only be permitted if (1) such Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period; and (2) no Default would be in existence following such designation. "U.S. Dollar Equivalent" means, with respect to any monetary amount in a currency other than U.S. dollars, at any time for determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as published in The Wall Street Journal in the "Exchange Rates" column under the heading "Currency Trading" on the date two Business Days prior to such determination. Except as described under Section 4.09 hereof, whenever it is necessary to determine whether the Company has complied with any covenant in this Indenture or a Default has occurred and an amount is expressed in a currency other than U.S. dollars, such amount will be treated as the U.S. Dollar Equivalent determined as of the date such amount is initially determined in such currency. "U.S. Person" means a U.S. Person as defined in Rule 902(k) promulgated under the Securities Act. "Voting Stock" of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person. "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing: (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by (2) the then outstanding principal amount of such Indebtedness. "Wholly Owned Restricted Subsidiary" of any specified Person means a Restricted Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors' qualifying shares) will at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person. Section 1.02 Other Definitions.
Defined in Term Section ---- ---------- "Affiliate Transaction".................................. 4.11 "Asset Sale Offer"....................................... 3.09 "Asset Sale Proceeds Account" ........................... 4.10 "Authentication Order"................................... 2.02 "Change of Control Offer"................................ 4.15 "Change of Control Payment".............................. 4.15 "Change of Control Payment Date"......................... 4.15
31
Defined in Term Section ---- ---------- "Collateral Offer Period" ............................... 3.10 "Collateral Proceeds Offer" ............................. 3.10 "Collateral Purchase Date" .............................. 3.10 "Conditions Precedent Date" ............................. 3.10 "Covenant Defeasance".................................... 8.03 "DTC".................................................... 2.03 "Event of Default"....................................... 6.01 "Excess Collateral Proceeds" ............................ 4.10 "Excess Proceeds"........................................ 4.10 "incur".................................................. 4.09 "Legal Defeasance"....................................... 8.02 "Make-Whole Redemption Date" ............................ 3.07 "Note Security Documents" ............................... 10.01 "Offer Amount"........................................... 3.09 "Offer Period"........................................... 3.09 "Paying Agent"........................................... 2.03 "Permitted Debt"......................................... 4.09 "Payment Default" ....................................... 6.01 "Purchase Date".......................................... 3.09 "Registrar".............................................. 2.03 "Restricted Payments".................................... 4.07 "Successor Company" ..................................... 5.01
Section 1.03 Incorporation by Reference of Trust Indenture Act. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: "indenture securities" means the Notes; "indenture security Holder" means a Holder of a Note; "indenture to be qualified" means this Indenture; "indenture trustee" or "institutional trustee" means the Trustee; and "obligor" on the Notes and the Note Guarantees means the Company and the Guarantors, respectively, and any successor obligor upon the Notes and the Note Guarantees, respectively. All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule under the TIA have the meanings so assigned to them. Section 1.04 Rules of Construction. Unless the context otherwise requires: (1) a term has the meaning assigned to it; 32 (2) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP; (3) "or" is not exclusive; (4) words in the singular include the plural, and in the plural include the singular; (5) "will" shall be interpreted to express a command; (6) provisions apply to successive events and transactions; and (7) references to sections of or rules under the Securities Act will be deemed to include substitute, replacement of successor sections or rules adopted by the SEC from time to time. 33 ARTICLE 2 THE NOTES Section 2.01 Form and Dating. (a) General. The Notes and the Trustee's certificate of authentication will be substantially in the form of Exhibits A1 and A2 hereto. The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage. Each Note will be dated the date of its authentication. The Notes shall be in denominations of $1,000 and integral multiples thereof. The terms and provisions contained in the Notes will constitute, and are hereby expressly made, a part of this Indenture and the Company, the Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Note conflicts with the express provisions of this Indenture, the provisions of this Indenture shall govern and be controlling. (b) Global Notes. Notes issued in global form will be substantially in the form of Exhibits A1 or A2 hereto (including the Global Note Legend thereon and the "Schedule of Exchanges of Interests in the Global Note" attached thereto). Notes issued in definitive form will be substantially in the form of Exhibit A1 hereto (but without the Global Note Legend thereon and without the "Schedule of Exchanges of Interests in the Global Note" attached thereto). Each Global Note will represent such of the outstanding Notes as will be specified therein and each shall provide that it represents the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby will be made by the Trustee or the Custodian, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof. (c) Temporary Global Notes. Notes offered and sold in reliance on Regulation S will be issued initially in the form of the Regulation S Temporary Global Note, which will be deposited on behalf of the purchasers of the Notes represented thereby with the Trustee, at its St. Paul office, as custodian for the Depositary, and registered in the name of the Depositary or the nominee of the Depositary for the accounts of designated agents holding on behalf of Euroclear or Clearstream, duly executed by the Company and authenticated by the Trustee as hereinafter provided. The Restricted Period will be terminated upon the receipt by the Trustee of: (1) a written certificate from the Depositary, together with copies of certificates from Euroclear and Clearstream certifying that they have received certification of non-United States beneficial ownership of 100% of the aggregate principal amount of the Regulation S Temporary Global Note (except to the extent of any beneficial owners thereof who acquired an interest therein during the Restricted Period pursuant to another exemption from registration under the Securities Act and who will take delivery of a beneficial ownership interest in a 144A Global Note or an IAI Global Note bearing a Private Placement Legend, all as contemplated by Section 2.06(b) hereof); and (2) an Officers' Certificate from the Company. 34 Following the termination of the Restricted Period, beneficial interests in the Regulation S Temporary Global Note will be exchanged for beneficial interests in the Regulation S Permanent Global Note pursuant to the Applicable Procedures. Simultaneously with the authentication of the Regulation S Permanent Global Note, the Trustee will cancel the Regulation S Temporary Global Note. The aggregate principal amount of the Regulation S Temporary Global Note and the Regulation S Permanent Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depositary or its nominee, as the case may be, in connection with transfers of interest as hereinafter provided. (3) Euroclear and Clearstream Procedures Applicable. The provisions of the "Operating Procedures of the Euroclear System" and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and Conditions of Clearstream Banking" and "Customer Handbook" of Clearstream will be applicable to transfers of beneficial interests in the Regulation S Temporary Global Note and the Regulation S Permanent Global Note that are held by Participants through Euroclear or Clearstream. Section 2.02 Execution and Authentication. At least one Officer must sign the Notes for the Company by manual or facsimile signature. If an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated, the Note will nevertheless be valid. A Note will not be valid until authenticated by the manual signature of the Trustee. The signature will be conclusive evidence that the Note has been authenticated under this Indenture. The Trustee will, from time to time upon receipt of a written order of the Company signed by two Officers (an "Authentication Order"), authenticate Notes for original issue that may be validly issued under this Indenture, including any Additional Notes up to the aggregate principal amount stated in paragraph 4 of the Notes. The aggregate principal amount of Notes outstanding at any time may not exceed the aggregate principal amount of Notes authorized for issuance by the Company pursuant to one or more Authentication Orders, except as provided in Section 2.07 hereof. The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Notes. An authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders or an Affiliate of the Company. Section 2.03 Registrar and Paying Agent. The Company will maintain an office or agency where Notes may be presented for registration of transfer or for exchange ("Registrar") and an office or agency where Notes may be presented for payment ("Paying Agent"). The Registrar will keep a register of the Notes and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The term "Registrar" includes any co-registrar and the term "Paying Agent" includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company will notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the Company fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar. 35 The Company initially appoints The Depository Trust Company ("DTC") to act as Depositary with respect to the Global Notes. The Company initially appoints the Trustee to act as the Registrar and Paying Agent and to act as Custodian with respect to the Global Notes. Section 2.04 Paying Agent to Hold Money in Trust. The Company will require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium or Liquidated Damages, if any, or interest on the Notes, and will notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) will have no further liability for the money. If the Company or a Subsidiary acts as Paying Agent, it will segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the Company, the Trustee will serve as Paying Agent for the Notes. Section 2.05 Holder Lists. The Trustee will preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee is not the Registrar, the Company will furnish to the Trustee at least seven Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of the Holders of Notes and the Company shall otherwise comply with TIA Section 312(a). Section 2.06 Transfer and Exchange. (a) Transfer and Exchange of Global Notes. A Global Note may not be transferred except as a whole by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. All Global Notes will be exchanged by the Company for Definitive Notes if: (1) the Company delivers to the Trustee notice from the Depositary that it is unwilling or unable to continue to act as Depositary or that it is no longer a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is not appointed by the Company within 60 days after the date of such notice from the Depositary; (2) the Company in its sole discretion determines that the Global Notes (in whole but not in part) should be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee; provided that in no event shall the Regulation S Temporary Global Note be exchanged by the Company for Definitive Notes prior to (A) the expiration of the Restricted Period and (B) the receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act; or (3) there has occurred and is continuing a Default or Event of Default with respect to the Notes. 36 Upon the occurrence of either of the preceding events in (1) or (2) above, Definitive Notes shall be issued in such names as the Depositary shall instruct the Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for another Note other than as provided in this Section 2.06(a), however, beneficial interests in a Global Note may be transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof. (b) Transfer and Exchange of Beneficial Interests in the Global Notes. The transfer and exchange of beneficial interests in the Global Notes will be effected through the Depositary, in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in the Restricted Global Notes will be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in the Global Notes also will require compliance with either subparagraph (1) or (2) below, as applicable, as well as one or more of the other following subparagraphs, as applicable: (1) Transfer of Beneficial Interests in the Same Global Note. Beneficial interests in any Restricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Note in accordance with the transfer restrictions set forth in the Private Placement Legend; provided, however, that prior to the expiration of the Restricted Period, transfers of beneficial interests in the Regulation S Temporary Global Note may not be made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Beneficial interests in any Unrestricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note. No written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.06(b)(1). (2) All Other Transfers and Exchanges of Beneficial Interests in Global Notes. In connection with all transfers and exchanges of beneficial interests that are not subject to Section 2.06(b)(1) above, the transferor of such beneficial interest must deliver to the Registrar either: (A) both: (i) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged; and (ii) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase; or (B) both: (i) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be transferred or exchanged; and 37 (ii) instructions given by the Depositary to the Registrar containing information regarding the Person in whose name such Definitive Note shall be registered to effect the transfer or exchange referred to in (1) above; provided that in no event shall Definitive Notes be issued upon the transfer or exchange of beneficial interests in the Regulation S Temporary Global Note prior to (A) the expiration of the Restricted Period and (B) the receipt by the Registrar of any certificates required pursuant to Rule 903 under the Securities Act. Upon consummation of an Exchange Offer by the Company in accordance with Section 2.06(f) hereof, the requirements of this Section 2.06(b)(2) shall be deemed to have been satisfied upon receipt by the Registrar of the instructions contained in the Letter of Transmittal delivered by the Holder of such beneficial interests in the Restricted Global Notes. Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained in this Indenture and the Notes or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 2.06(h) hereof. (3) Transfer of Beneficial Interests to Another Restricted Global Note. A beneficial interest in any Restricted Global Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Note if the transfer complies with the requirements of Section 2.06(b)(2) above and the Registrar receives the following: (A) if the transferee will take delivery in the form of a beneficial interest in the 144A Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; (B) if the transferee will take delivery in the form of a beneficial interest in the Regulation S Temporary Global Note or the Regulation S Permanent Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and (C) if the transferee will take delivery in the form of a beneficial interest in the IAI Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable. (4) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note. A beneficial interest in any Restricted Global Note may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Note or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note if the exchange or transfer complies with the requirements of Section 2.06(b)(2) above and: (A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a Person participating in the distribution of the Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144) of the Company; 38 (B) such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; (C) such transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or (D) the Registrar receives the following: (i) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(a) thereof; or (ii) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; and, in each such case set forth in this subparagraph (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. If any such transfer is effected pursuant to subparagraph (B) or (D) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to subparagraph (B) or (D) above. Beneficial interests in an Unrestricted Global Note cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Restricted Global Note. (c) Transfer or Exchange of Beneficial Interests for Definitive Notes. (1) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes. If any holder of a beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Note, then, upon receipt by the Registrar of the following documentation: (A) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (2)(a) thereof; (B) if such beneficial interest is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof; 39 (C) if such beneficial interest is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof; (D) if such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof; (E) if such beneficial interest is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable; (F) if such beneficial interest is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof; or (G) if such beneficial interest is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(c) thereof, the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the Company shall execute and the Trustee shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons in whose names such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(1) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein. (2) Beneficial Interests in Regulation S Temporary Global Note to Definitive Notes. Notwithstanding Sections 2.06(c)(1)(A) and (C) hereof, a beneficial interest in the Regulation S Temporary Global Note may not be exchanged for a Definitive Note or transferred to a Person who takes delivery thereof in the form of a Definitive Note prior to (A) the expiration of the Restricted Period and (B) the receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act, except in the case of a transfer pursuant to an exemption from the registration requirements of the Securities Act other than Rule 903 or Rule 904. (3) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes. A holder of a beneficial interest in a Restricted Global Note may exchange such beneficial interest for an Unrestricted Definitive Note or may transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note only if: (A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the holder of such beneficial 40 interest, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a Person participating in the distribution of the Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144) of the Company; (B) such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; (C) such transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or (D) the Registrar receives the following: (i) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(b) thereof; or (ii) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; and, in each such case set forth in this subparagraph (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. (4) Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes. If any holder of a beneficial interest in an Unrestricted Global Note proposes to exchange such beneficial interest for a Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Definitive Note, then, upon satisfaction of the conditions set forth in Section 2.06(b)(2) hereof, the Trustee will cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the Company will execute and the Trustee will authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(4) will be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest requests through instructions to the Registrar from or through the Depositary and the Participant or Indirect Participant. The Trustee will deliver such Definitive Notes to the Persons in whose names such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(4) will not bear the Private Placement Legend. (d) Transfer and Exchange of Definitive Notes for Beneficial Interests. (1) Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes. If any Holder of a Restricted Definitive Note proposes to exchange such Note for a beneficial interest in 41 a Restricted Global Note or to transfer such Restricted Definitive Notes to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Note, then, upon receipt by the Registrar of the following documentation: (A) if the Holder of such Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (2)(b) thereof; (B) if such Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof; (C) if such Restricted Definitive Note is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof; (D) if such Restricted Definitive Note is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof; (E) if such Restricted Definitive Note is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable; (F) if such Restricted Definitive Note is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof; or (G) if such Restricted Definitive Note is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(c) thereof, the Trustee will cancel the Restricted Definitive Note, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, the 144A Global Note, in the case of clause (C) above, the Regulation S Global Note, and in all other cases, the IAI Global Note. (2) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of a Restricted Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Restricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note only if: (A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the Holder, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a Person participating in the distribution 42 of the Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144) of the Company; (B) such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; (C) such transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or (D) the Registrar receives the following: (i) if the Holder of such Definitive Notes proposes to exchange such Notes for a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (1)(c) thereof; or (ii) if the Holder of such Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; and, in each such case set forth in this subparagraph (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. Upon satisfaction of the conditions of any of the subparagraphs in this Section 2.06(d)(2), the Trustee will cancel the Definitive Notes and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Note. (3) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Definitive Notes to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note at any time. Upon receipt of a request for such an exchange or transfer, the Trustee will cancel the applicable Unrestricted Definitive Note and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global Notes. If any such exchange or transfer from a Definitive Note to a beneficial interest is effected pursuant to subparagraphs (2)(B), (2)(D) or (3) above at a time when an Unrestricted Global Note has not yet been issued, the Company will issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee will authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of Definitive Notes so transferred. (e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon request by a Holder of Definitive Notes and such Holder's compliance with the provisions of this Section 2.06(e), the Registrar will register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting Holder must present or surrender to the Registrar the Definitive Notes duly 43 endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such Holder or by its attorney, duly authorized in writing. In addition, the requesting Holder must provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.06(e). (1) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted Definitive Note may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Note if the Registrar receives the following: (A) if the transfer will be made pursuant to Rule 144A, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; (B) if the transfer will be made pursuant to Rule 903 or Rule 904, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and (C) if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable. (2) Restricted Definitive Notes to Unrestricted Definitive Notes. Any Restricted Definitive Note may be exchanged by the Holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note if: (A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the Holder, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a Person participating in the distribution of the Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144) of the Company; (B) any such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; (C) any such transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or (D) the Registrar receives the following: (i) if the Holder of such Restricted Definitive Notes proposes to exchange such Notes for an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (1)(d) thereof; or (ii) if the Holder of such Restricted Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; 44 and, in each such case set forth in this subparagraph (D), if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. (3) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A Holder of Unrestricted Definitive Notes may transfer such Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a transfer, the Registrar shall register the Unrestricted Definitive Notes pursuant to the instructions from the Holder thereof. (f) Exchange Offer. Upon the occurrence of the Exchange Offer in accordance with the Registration Rights Agreement, the Company will issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee will authenticate: (1) one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of the beneficial interests in the Restricted Global Notes accepted for exchange in the Exchange Offer by Persons that certify in the applicable Letters of Transmittal that (A) they are not Broker-Dealers, (B) they are not participating in a distribution of the Exchange Notes and (C) they are not affiliates (as defined in Rule 144) of the Company; and (2) Unrestricted Definitive Notes in an aggregate principal amount equal to the principal amount of the Restricted Definitive Notes accepted for exchange in the Exchange Offer by Persons that certify in the applicable Letters of Transmittal that (A) they are not Broker-Dealers, (B) they are not participating in a distribution of the Exchange Notes and (C) they are not affiliates (as defined in Rule 144) of the Company. Concurrently with the issuance of such Notes, the Trustee will cause the aggregate principal amount of the applicable Restricted Global Notes to be reduced accordingly, and the Company will execute and the Trustee will authenticate and deliver to the Persons designated by the Holders of Definitive Notes so accepted Unrestricted Definitive Notes in the appropriate principal amount. (g) Legends. The following legends will appear on the face of all Global Notes and Definitive Notes issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture. (1) Private Placement Legend. (A) Except as permitted by subparagraph (B) below, each Global Note and each Definitive Note (and all Notes issued in exchange therefor or substitution thereof) shall bear the legend in substantially the following form: "THIS NOTE (OR ITS PREDECESSOR ) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. 45 THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO ANY EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER (IF AVAILABLE), (IV) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE." (B) Notwithstanding the foregoing, any Global Note or Definitive Note issued pursuant to subparagraphs (b)(4), (c)(3), (c)(4), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of this Section 2.06 (and all Notes issued in exchange therefor or substitution thereof) will not bear the Private Placement Legend. (2) Global Note Legend. Each Global Note will bear a legend in substantially the following form: "THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF MILACRON ESCROW CORPORATION. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN 46 AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN." (3) Regulation S Temporary Global Note Legend. The Regulation S Temporary Global Note will bear a Legend in substantially the following form: "THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON." (4) Original Issue Discount Legend. Each Note will bear a legend in substantially the following form: "THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT UNDER SECTION 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. YOU MAY CONTACT THE CHIEF FINANCIAL OFFICER OF THE COMPANY, AT 2090 FLORENCE AVENUE, CINCINNATI, OHIO, 45206, (513) 487-5000, WHO WILL PROVIDE YOU WITH ANY REQUIRED INFORMATION REGARDING THE ORIGINAL ISSUE DISCOUNT." (h) Cancellation and/or Adjustment of Global Notes. At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note will be returned to or retained and canceled by the Trustee in accordance with Section 2.11 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note will be reduced accordingly and an endorsement will be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note will be increased accordingly and an endorsement will be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such increase. (i) General Provisions Relating to Transfers and Exchanges. (1) To permit registrations of transfers and exchanges, the Company will execute and the Trustee will authenticate Global Notes and Definitive Notes upon receipt of an Authentication Order in accordance with Section 2.02 hereof or at the Registrar's request. (2) No service charge will be made to a Holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.10, 4.15 and 9.05 hereof). (3) The Registrar will not be required to register the transfer of or exchange of any Note selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part. 47 (4) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes will be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange. (5) Neither the Registrar nor the Company will be required: (A) to issue, to register the transfer of or to exchange any Notes during a period beginning at the opening of business 15 days before the day of any selection of Notes for redemption under Section 3.02 hereof and ending at the close of business on the day of selection; (B) to register the transfer of or to exchange any Note selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part; or (C) to register the transfer of or to exchange a Note between a record date and the next succeeding interest payment date. (6) Prior to due presentment for the registration of a transfer of any Note, the Trustee, any Agent and the Company may deem and treat the Person in whose name any Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Notes and for all other purposes, and none of the Trustee, any Agent or the Company shall be affected by notice to the contrary. (7) The Trustee will authenticate Global Notes and Definitive Notes in accordance with the provisions of Section 2.02 hereof. (8) All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted by facsimile. Section 2.07 Replacement Notes. If any mutilated Note is surrendered to the Trustee or the Company and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, the Company will issue and the Trustee, upon receipt of an Authentication Order, will authenticate a replacement Note if the Trustee's requirements are met. If required by the Trustee or the Company, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer if a Note is replaced. The Company may charge for its expenses in replacing a Note. Every replacement Note is an additional obligation of the Company and will be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder. Section 2.08 Outstanding Notes. The Notes outstanding at any time are all the Notes authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section 2.08 as not outstanding. Except as set forth in Section 2.09 hereof, a Note does not cease to be outstanding because the Company or an Affiliate of the Company holds the Note; however, Notes held by the 48 Company or a Subsidiary of the Company shall not be deemed to be outstanding for purposes of Section 3.07(a) hereof. If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a protected purchaser. If the principal amount of any Note is considered paid under Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue. If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on a redemption date or maturity date, money sufficient to pay Notes payable on that date, then on and after that date such Notes will be deemed to be no longer outstanding and will cease to accrue interest. Section 2.09 Treasury Notes. In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company or any Guarantor, or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any Guarantor, will be considered as though not outstanding, except that for the purposes of determining whether the Trustee will be protected in relying on any such direction, waiver or consent, only Notes that the Trustee knows are so owned will be so disregarded. Section 2.10 Temporary Notes. Until certificates representing Notes are ready for delivery, the Company may prepare and the Trustee, upon receipt of an Authentication Order, will authenticate temporary Notes. Temporary Notes will be substantially in the form of certificated Notes but may have variations that the Company considers appropriate for temporary Notes and as may be reasonably acceptable to the Trustee. Without unreasonable delay, the Company will prepare and the Trustee will authenticate definitive Notes in exchange for temporary Notes. Holders of temporary Notes will be entitled to all of the benefits of this Indenture. Section 2.11 Cancellation. The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent will forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else will cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and will destroy canceled Notes (subject to the record retention requirement of the Exchange Act). Certification of the destruction of all canceled Notes will be delivered to the Company. The Company may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation. Section 2.12 Defaulted Interest. If the Company defaults in a payment of interest on the Notes, it will pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Notes and in Section 4.01 hereof. The Company will notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Company will fix or cause to be fixed each such special record date and payment date; provided that no such special record date may 49 be less than 10 days prior to the related payment date for such defaulted interest. At least 15 days before the special record date, the Company (or, upon the written request of the Company, the Trustee in the name and at the expense of the Company) will mail or cause to be mailed to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid. Section 2.13 CUSIP Numbers. The Company in issuing the Notes may use "CUSIP" numbers (if then generally in use) and, if so, the Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee of any change in the CUSIP numbers. Section 2.14 Issuance of Additional Notes. The Company shall be entitled, subject to its compliance with Sections 4.09 and 4.12, to issue up to $50 million in aggregate principal amount of Additional Notes under this Indenture which shall have identical terms as the Initial Notes, other than with respect to the date of issuance and issue price, provided that the Additional Notes are fungible with the Initial Notes for U.S. Federal Income tax purposes. The Initial Notes, any Additional Notes and all Exchange Notes or Private Exchange Notes issued in exchange therefore shall be treated as a single class for all purposes under this Indenture. With respect to any Additional Notes, the Company shall set forth in a resolution of the Board of Directors and Officers' Certificate, a copy of each which shall be delivered to the Trustee, the following information: (a) the aggregate principal amount of such Additional Notes to be authenticated and delivered pursuant to this Indenture; (b) the issue price, the issue date and the CUSIP number of such Additional Notes; and (c) whether such Additional Notes shall be transfer restricted notes and issued in the form of Initial Notes as set forth in Section 2.02 of this Indenture or shall be issued in the form of Exchange Notes. ARTICLE 3 REDEMPTION AND PREPAYMENT Section 3.01 Notices to Trustee. If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it must furnish to the Trustee, at least 30 days but not more than 60 days before a redemption date, an Officers' Certificate setting forth: (1) the clause of this Indenture pursuant to which the redemption shall occur; (2) the redemption date; (3) the principal amount of Notes to be redeemed; and (4) the redemption price. 50 Section 3.02 Selection of Notes to Be Redeemed or Purchased. If less than all of the Notes are to be redeemed or purchased in an offer to purchase at any time, the Trustee will select Notes for redemption or purchase on a pro rata basis except: (1) if the Notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which the Notes are listed; or (2) if otherwise required by law. In the event of partial redemption or purchase by lot, the particular Notes to be redeemed or purchased will be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption or purchase date by the Trustee from the outstanding Notes not previously called for redemption or purchase. The Trustee will promptly notify the Company in writing of the Notes selected for redemption or purchase and, in the case of any Note selected for partial redemption or purchase, the principal amount thereof to be redeemed or purchased. Notes and portions of Notes selected will be in amounts of $1,000 or whole multiples of $1,000; except that if all of the Notes of a Holder are to be redeemed or purchased, the entire outstanding amount of Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed or purchased. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption or purchase also apply to portions of Notes called for redemption or purchase. Section 3.03 Notice of Redemption. Subject to the provisions of Section 3.09 hereof, at least 30 days but not more than 60 days before a redemption date, the Company will mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction and discharge of this Indenture pursuant to Articles 8 or 12 hereof. The notice will identify the Notes to be redeemed and will state: (1) the redemption date; (2) the redemption price; (3) if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the redemption date upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion will be issued upon cancellation of the original Note; (4) the name and address of the Paying Agent; (5) that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price; (6) that, unless the Company defaults in making such redemption payment, interest on Notes called for redemption ceases to accrue on and after the redemption date; 51 (7) the paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and (8) that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Notes. At the Company's request, the Trustee will give the notice of redemption in the Company's name and at its expense; provided, however, that the Company has delivered to the Trustee, at least 45 days prior to the redemption date, an Officers' Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the preceding paragraph. Section 3.04 Effect of Notice of Redemption. Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption become irrevocably due and payable on the redemption date at the redemption price stated in the notice. A notice of redemption may not be conditional. Section 3.05 Deposit of Redemption or Purchase Price. One Business Day prior to the redemption or purchase date, the Company will deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption or purchase price of and accrued interest and Liquidated Damages, if any, on all Notes to be redeemed or purchased on that date. The Trustee or the Paying Agent will promptly return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the redemption or purchase price of, and accrued interest and Liquidated Damages, if any, on, all Notes to be redeemed or purchased. If the Company complies with the provisions of the preceding paragraph, on and after the redemption or purchase date, interest will cease to accrue on the Notes or the portions of Notes called for redemption or purchase. If a Note is redeemed or purchased on or after an interest record date but on or prior to the related interest payment date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such record date. If any Note called for redemption or purchase is not so paid upon surrender for redemption or purchase because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal, from the redemption or purchase date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof. Section 3.06 Notes Redeemed or Purchased in Part. Upon surrender of a Note that is redeemed or purchased in part, the Company will issue and, upon receipt of an Authentication Order, the Trustee will authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed or unpurchased portion of the Note surrendered. Section 3.07 Optional Redemption. (a) At any time prior to May 15, 2007, the Company may on any one or more occasions redeem up to 35% of the aggregate principal amount of Notes issued under this Indenture at a redemption price of 111.5% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the redemption date, with the net cash proceeds one or more Qualified Equity Issuances; provided that: 52 (1) at least 65% of the aggregate principal amount of Notes originally issued under this Indenture (excluding Notes held by the Company and its Subsidiaries) remains outstanding immediately after the occurrence of such redemption; and (2) the redemption occurs within 90 days of the date of the closing of such Qualified Equity Issuances. (b) The Company may also at its option on any one or more occasions redeem all or part of the Notes upon not less than 30 nor more than 60 days prior notice, at a redemption price equal to 100% of the principal amount thereof plus the Applicable Premium as of the date of redemption (the "Make-Whole Redemption Date"). Notices of redemption may be conditional. (c) Any redemption pursuant to this Section 3.07 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof. Section 3.08 Mandatory Redemption. Other than as set forth in Section 3.11, the Company is not required to make mandatory redemption or sinking fund payments with respect to the Notes. Section 3.09 Offer to Purchase by Application of Excess Proceeds. In the event that, pursuant to Section 4.10(c) hereof, the Company is required to commence an offer to all Holders to purchase Notes (an "Asset Sale Offer"), it will follow the procedures specified below. The Asset Sale Offer shall be made to all Holders. The Asset Sale Offer will remain open for a period of 20 Business Days following its commencement and no longer, except to the extent that a longer period is required by applicable law (the "Offer Period"). No later than five Business Days after the termination of the Offer Period (the "Purchase Date"), the Company will apply all Excess Proceeds (the "Offer Amount") to the purchase of Notes or, if less than the Offer Amount has been tendered, all Notes tendered in response to the Asset Sale Offer. Payment for any Notes so purchased will be made in the same manner as interest payments are made. If the Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest and Liquidated Damages, if any, will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Sale Offer. Upon the commencement of an Asset Sale Offer, the Company will send, by first class mail, a notice to the Trustee and each of the Holders, with a copy to the Trustee. The notice will contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Asset Sale Offer. The notice, which will govern the terms of the Asset Sale Offer, will state: (1) that the Asset Sale Offer is being made pursuant to this Section 3.09 and Section 4.10(c) hereof and the length of time the Asset Sale Offer will remain open; (2) the Offer Amount, the purchase price and the Purchase Date; (3) that any Note not tendered or accepted for payment will continue to accrete or accrue interest; 53 (4) that, unless the Company defaults in making such payment, any Note accepted for payment pursuant to the Asset Sale Offer will cease to accrete or accrue interest after the Purchase Date; (5) that Holders electing to have a Note purchased pursuant to an Asset Sale Offer may elect to have Notes purchased in integral multiples of $1,000 only; (6) that Holders electing to have Notes purchased pursuant to any Asset Sale Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" attached to the Notes completed, or transfer by book-entry transfer, to the Company, a Depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice at least three days before the Purchase Date; (7) that Holders will be entitled to withdraw their election if the Company, the Depositary or the Paying Agent, as the case may be, receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased; (8) that, if the aggregate principal amount of Notes surrendered by Holders thereof exceeds the Offer Amount, the Company will select the Notes to be purchased on a pro rata basis based on the principal amount of Notes surrendered (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, will be purchased); and (9) that Holders whose Notes were purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer). On or before the Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer, or if less than the Offer Amount has been tendered, all Notes tendered, and will deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers' Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.09. The Company, the Depositary or the Paying Agent, as the case may be, will promptly (but in any case not later than five days after the Purchase Date) mail or deliver to each tendering Holder an amount equal to the purchase price of the Notes tendered by such Holder and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon written request from the Company, will authenticate and mail or deliver (or cause to be transferred by book entry) such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered. Any Note not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Sale Offer on the Purchase Date. Other than as specifically provided in this Section 3.09, any purchase pursuant to this Section 3.09 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof. Section 3.10 Offer to Purchase by Application of Collateral Proceeds. 54 In the event that, pursuant to Section 4.10(f) hereof, the Company is required to commence an offer to all Holders to purchase Notes (a "Collateral Proceeds Offer"), it will follow the procedures specified below. The Collateral Proceeds Offer shall be made to all Holders. The Collateral Proceeds Offer will remain open for a period of 20 Business Days following its commencement and no longer except to the extent that a longer period is required by applicable law (the "Collateral Offer Period"). No later than five Business Days after termination of the Collateral Offer Period (the "Collateral Purchase Date"), the Company will apply all Excess Collateral Proceeds (the "Collateral Offer Amount") to the purchase of Notes or, if less than the Collateral Offer Amount has been tendered, all Notes tendered in response to the Collateral Proceeds Offer. Payment for any Notes so purchased will be made in the same manner as interest payments are made. If the Collateral Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest and Liquidated Damages, if any, will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Collateral Proceeds Offer. Upon the commencement of Collateral Proceeds Offer, the Company will send, by first class mail, a notice to the Trustee and each of the Holders, with a copy to the Trustee. The notice will contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Collateral Proceeds Offer. The notice, which will govern the terms of the Collateral Proceeds Offer, will state: (1) that the Collateral Proceeds Offer is being made pursuant to this Section 3.10 and Section 4.10(f) hereof and the length of time the Collateral Proceeds Offer will remain open; (2) the Collateral Offer Amount, the purchase price and the Collateral Purchase Date; (3) that any Note not tendered or accepted for payment will continue to accrete or accrue interest; (4) that, unless the Company defaults in making such payment, any Note accepted for payment pursuant to the Collateral Proceeds Offer will cease to accrete or accrue interest after the Collateral Purchase Date; (5) that Holders electing to have a Note purchased pursuant to a Collateral Proceeds Offer may elect to have Notes purchased in integral multiples of $1,000 only; (6) that Holders electing to have Notes purchased pursuant to any Collateral Proceeds Offer will be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" attached to the Notes completed, or transfer by book-entry transfer, to the Company, a Depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice at least three days before the Collateral Purchase Date; (7) that Holders will be entitled to withdraw their election if the Company, the Depositary or the Paying Agent, as the case may be, receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased; 55 (8) that, if the aggregate principal amount of Notes surrendered by Holders thereof exceeds the Offer Amount, the Company will select the Notes to be purchased on a pro rata basis based on the principal amount of Notes surrendered (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, will be purchased); and (9) that Holders whose Notes were purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer). On or before the Collateral Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Offer Amount of Notes or portions thereof tendered pursuant to the Collateral Proceeds Offer, or if less than the Offer Amount has been tendered, all Notes tendered, and will deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers' Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.10. The Company, the Depositary or the Paying Agent, as the case may be, will promptly (but in any case not later than five days after the Collateral Purchase Date) mail or deliver to each tendering Holder an amount equal to the purchase price of the Notes tendered by such Holder and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon written request from the Company, will authenticate and mail or deliver (or cause to be transferred by book entry) such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered. Any Note not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Collateral Proceeds Offer on the Collateral Purchase Date. Other than as specifically provided in this Section 3.10, any purchase pursuant to this Section 3.10 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof. Section 3.11 Special Mandatory Redemption. In accordance with the terms and conditions of the Escrow Agreement, and using the funds in the Escrow Account, the Company shall redeem on the Escrow Redemption Date all and not less than all of the Notes at the Escrow Redemption Price if the Officers' Certificate required by Section 3(b) of the Escrow Agreement to be delivered by July 29, 2004 (the "Conditions Precedent Date") (or if the Conditions Precedent Date has been extended pursuant to the terms of the Escrow Agreement, by August 31, 2004) has not been so delivered. Upon the release of the funds from the Escrow Account after delivery of the Officers' Certificate required by Section 3(b) of the Escrow Agreement, the foregoing provisions of this Section 3.11 shall be null and void. ARTICLE 4 COVENANTS Section 4.01 Payment of Notes. The Company shall pay or cause to be paid the principal of, premium, if any, and interest and Liquidated Damages, if any, on, the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest and Liquidated Damages, if any, shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. The Company 56 shall pay all Liquidated Damages, if any, in the same manner on the dates and in the amounts set forth in the Registration Rights Agreement. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at the rate equal to 1% per annum in excess of the then applicable interest rate on the Notes to the extent lawful; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and Liquidated Damages (without regard to any applicable grace period) at the same rate to the extent lawful. Section 4.02 Maintenance of Office or Agency. The Company shall maintain in the City of St. Paul, Minnesota, an office or agency (which may be an office of the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served. The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company fails to maintain any such required office or agency or fails to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee. The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in the City of St. Paul, Minnesota, for such purposes. The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with Section 2.03 hereof. Section 4.03 Reports. (a) Whether or not required by the Commission's rules and regulations, so long as any Notes are outstanding, the Company shall furnish to the Holders of Notes, within the time periods specified in the Commission's rules and regulations: (1) all quarterly and annual reports that would be required to be filed with the Commission on Forms 10-Q and 10-K if the Company were required to file such reports; and (2) all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file such reports; provided, however, that the availability of the foregoing materials on the SEC's EDGAR service or the Company's website shall be deemed to satisfy the Company's delivery obligation set forth above and provided further, however, that for purposes of this Section 4.03 prior to the expiration of the Escrow Period, such reports may be the reports of Milacron and not of the Company. (b) All reports required under Section 4.03(a) shall be prepared in all material respects in accordance with all of the rules and regulations applicable to such reports. Each annual report on Form 10-K shall include a report on the Company's consolidated financial statements by the Company's certified independent accountants. In addition, the Company shall file a copy of each of the reports referred to in 57 clauses (1) and (2) of Section 4.03(a) with the SEC for public availability within the time periods specified in the rules and regulations applicable to such reports (unless the SEC will not accept such a filing) and make such information available to securities analysts and prospective investors upon request. (c) If, at any time, the Company is not subject to the periodic reporting requirements of the Exchange Act for any reason, the Company shall nevertheless continue filing the reports specified in 4.03(a) with the SEC within the time periods specified in Section 4.03(b) unless the SEC will not accept such a filing. If the SEC will not accept the Company's filings for any reason, the Company shall post the reports referred to in 4.03(a) on its website within the time periods that would apply if the Company were required to file those reports with the SEC. (d) In addition, the Company and the Guarantors agree that, for so long as any Notes remain outstanding, at any time they are not required to file the reports required by the preceding paragraphs of this Section 4.03 with the SEC, they shall furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act. Section 4.04 Compliance Certificate. (a) The Company and each Guarantor (to the extent that such Guarantor is so required under the TIA) shall deliver to the Trustee, within 90 days after the end of each fiscal year, an Officers' Certificate stating that a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company has kept, observed, performed and fulfilled its obligations under this Indenture and the other Senior Secured Note Documents, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge the Company has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and the other Senior Secured Note Documents and is not in default in the performance or observance of any of the terms, provisions and conditions of this Indenture or the other Senior Secured Note Documents (or, if a Default or Event of Default has occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is taking or proposes to take with respect thereto) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of which payments on account of the principal of or interest, if any, on the Notes is prohibited or if such event has occurred, a description of the event and what action the Company is taking or proposes to take with respect thereto. (b) So long as any of the Notes are outstanding, the Company shall deliver to the Trustee, forthwith upon any Officer becoming aware of any Default or Event of Default, an Officers' Certificate specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto. Section 4.05 Taxes. The Company shall pay, and shall cause each of the Guarantors to pay, prior to delinquency, all material taxes, assessments, and governmental levies except such as are contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders of the Notes. Section 4.06 Stay, Extension and Usury Laws. The Company and each of the Guarantors covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or 58 advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company and each of the Guarantors (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted. Section 4.07 Restricted Payments. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly: (1) declare or pay any dividend or make any other payment or distribution on account of the Company's or any of its Restricted Subsidiaries' Equity Interests (including, without limitation, any payment in connection with any merger, amalgamation or consolidation involving the Company or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Company's or any of its Restricted Subsidiaries' Equity Interests in their capacity as such (other than dividends or distributions payable (a) in Equity Interests (other than Disqualified Stock) of the Company or (b) to the Company or a Restricted Subsidiary of the Company); (2) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger, amalgamation or consolidation involving the Company) any Equity Interests of the Company (other than any such Equity Interests owned by the Company or any Guarantor); (3) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness of the Company or any Guarantor that is contractually subordinated to the Notes or to any Note Guarantee thereof (excluding any intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries) except a payment of interest or principal at or within one year of the Stated Maturity thereof; or (4) make any Restricted Investment (all such payments and other actions set forth in these clauses (1) through (4) above being collectively referred to as "Restricted Payments"), unless, at the time of and after giving effect to such Restricted Payment: (1) no Default has occurred and is continuing or would occur as a consequence of such Restricted Payment; and (2) the Company would, at the time of such Restricted Payment, 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 Section 4.09(a) and (3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the date of this Indenture (excluding Restricted Payments permitted by clauses (2), (3), (4), (6), (7), (8), (9) and (10) of Section 4.07(b)), is less than the sum, without duplication, of: 59 (A) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from the beginning of the first fiscal quarter commencing after the date of this Indenture to the end of the Company's most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit), plus (B) 100% of the aggregate net cash proceeds received by the Company since the date of this Indenture as a contribution to its common equity capital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock) or from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of the Company that have been converted into or exchanged for such Equity Interests (other than Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary of the Company), plus (C) the amount by which Indebtedness of the Company is reduced on the Company's balance sheet upon the conversion or exchange (other than (A) the exchange of Series B Notes for Series B Preferred Stock or (B) a conversion or exchange by a Subsidiary of the Company) subsequent to the date of this Indenture of any Indebtedness of the Company convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Company (less the amount of any cash, or the fair value of any other property, distributed by the Company upon such conversion or exchange), plus (D) to the extent that any Restricted Investment that was made after the date of this Indenture is sold for cash or otherwise liquidated, repaid, repurchased or redeemed for cash, the lesser of (A) the cash return of capital with respect to such Restricted Investment (less the cost of disposition, if any) and (B) the initial amount of such Restricted Investment, plus (E) to the extent that any Unrestricted Subsidiary of the Company is redesignated as a Restricted Subsidiary after the date of this Indenture, the lesser of (A) the fair market value of the Company's investment in such Subsidiary as of the date of such redesignation and (B) such fair market value as of the date on which such subsidiary was originally designated as an Unrestricted Subsidiary. (b) The provisions of Section 4.07(a) hereof shall not prohibit: (1) the payment of any dividend or similar distribution or the consummation of any redemption within 60 days after the date of declaration of the dividend or distribution or the giving of the redemption notice, as the case may be, if at the date of declaration or notice, the dividend, distribution, redemption or payment would have complied with the provisions of this Indenture; (2) any Restricted Payment made in exchange for, or made out of the net cash proceeds of the substantially concurrent sale (other than to a Restricted Subsidiary of the Company) of, Equity Interests of the Company (other than Disqualified Stock) or from the substantially concurrent contribution of common equity capital to the Company; provided that the amount of any such Restricted Payment made shall be excluded from clause (3)(B) of Section 4.07(a); 60 (3) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness of the Company or any Guarantor in exchange for, or out of the net cash proceeds from an incurrence of, Permitted Refinancing Indebtedness; (4) the payment of any dividend or other similar distribution by a Restricted Subsidiary of the Company to the holders of its Equity Interests on a pro rata basis; (5) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company or any Restricted Subsidiary of the Company (a) held by any employee or director of the Company (or any of its Restricted Subsidiaries) or (b) in connection with, or to provide the Equity Interests for, delivery of Equity Interests to grantees under any stock incentive plan of the Company or any of its Restricted Subsidiaries; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests may not exceed $1.0 million in any fiscal year, provided further, however, that amounts available pursuant to this clause (5) to be utilized for Restricted Payments during any such fiscal year that are not so utilized may be carried forward and utilized in any succeeding fiscal year; (6) the purchase by the Company of fractional shares arising out of stock dividends, splits, conversions or combinations or business combinations; (7) the exchange of Milacron's common stock into which the Series A Notes have been converted and of the Series B Notes for Series B Preferred Stock in accordance with the Note Purchase Agreement; (8) the payment of any dividends on the Existing Preferred Stock in accordance with its terms not to exceed $300,000 in any 12-month period, beginning with the 12-month period commencing on the date of this Indenture; (9) the redemption of shares of Series B Preferred Stock with the proceeds of a Rights Offering in accordance with the terms of the Series B Preferred Stock; and (10) so long as no Default has occurred and is continuing or would be caused thereby, Restricted Payments in an aggregate amount which, when added together with the amount of all other Restricted Payments made under this clause (10), does not exceed $10.0 million. (c) The amount of all Restricted Payments (other than cash) shall be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any assets or securities that are required to be valued by this Section 4.07 shall be determined by the Board of Directors of the Company whose resolution shall be conclusive with respect thereto shall be delivered to the Trustee. Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries. (a) The Company shall not, and shall 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 of its Restricted Subsidiaries to: (1) pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, or with respect to any other interest or participation in, or 61 measured by, its profits, or pay any indebtedness owed to the Company or any of its Restricted Subsidiaries; (2) make loans or advances to the Company or any of its Restricted Subsidiaries; or (3) transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries. (b) The restrictions in Section 4.08(a) shall not apply to encumbrances or restrictions existing under or by reason of: (1) agreements governing Existing Indebtedness and Credit Facilities (other than the Series B Notes and the Existing Senior Credit Facility) as in effect on the date of this Indenture and the ABL Facility and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of those agreements, provided that the amendments, modifications, restatements, renewals, increases, supplements, refundings, replacement or refinancings are not materially more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreements on the date of this Indenture; (2) any agreement governing the terms of any Indebtedness incurred pursuant to clause (2) of Section 4.09(b) hereof, provided that (a) either (i) the encumbrance or restriction applies only in the event of and during the continuation of a default under such agreement or (ii) the Board of Directors of the Company determines, at the time such agreement is entered into (and at the time of any modification of the terms of any such encumbrance or restriction), any such encumbrance or restriction will not materially affect the Company's ability to make principal or interest payments on the Notes and (b) the encumbrance or restriction is not materially less favorable to the Holders of the Notes than is customary in comparable financings or agreements (as determined by the Board of Directors of the Company); (3) agreements governing the Series B Notes and the Existing Credit Facility; (4) this Indenture, the Notes and the Note Guarantees; (5) applicable law and any applicable rule, regulation or order; (6) any instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired, provided that, in the case of Indebtedness, such Indebtedness was permitted by the terms of this Indenture to be incurred; (7) customary non-assignment provisions in leases, licenses or contracts entered into in the ordinary course of business; (8) purchase money obligations that impose restrictions on that property of the nature described in clause (3) of Section 4.08(a); 62 (9) customary restrictions in any agreement for the sale or other disposition 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 Capital Stock or assets of that Subsidiary; (10) Permitted Refinancing Indebtedness, provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced, as determined in good faith by the Board of Directors of the Company; (11) Liens securing Indebtedness that limit the right of the debtor to dispose of the assets subject to such Liens; (12) customary provisions in joint venture agreements, assets sale agreements, stock sale agreements and other similar agreements entered into in the ordinary course of business; (13) agreements governing Indebtedness of Foreign Restricted Subsidiaries under Foreign Credit Facilities; provided that such encumbrances or restrictions are customary and market for similarly situated borrowers under similar kinds of agreements for working capital Indebtedness at the time of entering into such Foreign Credit Facilities; (14) Indebtedness or other contractual requirements of a Receivables Subsidiary in connection with a Qualified Receivables Transaction; provided that such restrictions apply only to such Receivables Subsidiary; and (15) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business. Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stock, in each case if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. (b) The provisions of Section 4.09(a) hereof shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"): (1) the incurrence by the Company and any of the Guarantors of additional Indebtedness and letters of credit under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries 63 thereunder) not to exceed the greater of (x) $75.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries since the date of this Indenture to repay any term Indebtedness under a Credit Facility or to repay any revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to Section 4.10 hereof and less the amount of any Indebtedness of a Domestic Receivables Subsidiary outstanding under clause (15) of this Section 4.09(b) and (y) the Domestic Borrowing Base; (2) the incurrence by the Foreign Restricted Subsidiaries of additional Indebtedness and letters of credit under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (2) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Foreign Restricted Subsidiaries thereunder) not to exceed the greater of (x) $40.0 million less Indebtedness of Foreign Restricted Subsidiaries existing at the time of such incurrence less the aggregate amount of all Net Proceeds of Asset Sales applied by the Foreign Restricted Subsidiaries since the date of this Indenture to repay any term Indebtedness under a Credit Facility or to repay any revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to Section 4.10 hereof and less the amount of any Indebtedness of a Foreign Receivables Subsidiary outstanding under clause (15) of this Section 4.09(b) and (y) the Foreign Borrowing Base; (3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness; (4) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes to be issued on the date of this Indenture, the related Note Guarantees to be issued after the expiration of the Escrow Period and the Exchange Notes and the related Note Guarantees to be issued pursuant to the Registration Rights Agreement; (5) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (5), not to exceed $30.0 million at any time outstanding; (6) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under Section 4.09(a) or clauses (3), (4), (5), (6), (17) or (18) of this Section 4.09(b); (7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that: (A) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Note Guarantee, in the case of a Guarantor; 64 (B) if the obligee on such Indebtedness is the Company or a Guarantor, a perfected first priority security interest (subject to Permitted Prior Liens) is promptly granted to the trustee in such intercompany Indebtedness; and (C) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (7); (8) prior to the expiration of the Escrow Period, the incurrence by the Company and its Restricted Subsidiaries of Indebtedness under the Existing Senior Credit Facility; (9) prior to the expiration of the Escrow Period, the incurrence by the Company of the Series B Notes; (10) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations in the ordinary course of business; (11) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Guarantor that was permitted to be incurred by another provision of this Section 4.09; (12) the incurrence of Obligations in respect of performance, bid and surety bonds and completion guarantees provided by the Company or any of its Restricted Subsidiaries in the ordinary course of business; (13) the incurrence of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within five Business Days of its incurrence; (14) the guarantee by the Foreign Restricted Subsidiaries of Indebtedness of the Foreign Restricted Subsidiaries that was permitted to be incurred by another provision of this covenant; (15) the incurrence by any Receivables Subsidiary of Indebtedness pursuant to a Qualified Receivables Transaction; (16) the incurrence of unsecured Indebtedness in respect of customer financing programs (including lease transactions) in an aggregate principal amount at any one time outstanding under this clause (16) not to exceed $15.0 million; (17) the incurrence by Foreign Restricted Subsidiaries of Indebtedness in an aggregate principal amount, at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (17), not to exceed $5.0 million; and (18) the incurrence by the Company or any of its Restricted Subsidiaries of additional unsecured Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any 65 time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (18), not to exceed $25.0 million; provided that Restricted Subsidiaries that are not Guarantors may not incur Indebtedness, when taken together with any Indebtedness issued and outstanding under clause (17) of this Section 4.09(b), in excess of $8.0 million in the aggregate pursuant to this clause (18). To the extent the Company's Unrestricted Subsidiaries incur Non-Recourse Indebtedness and any such Indebtedness ceases to be Non-Recourse Indebtedness, then such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was subject to this Section 4.09. The Company and the Guarantors shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or any Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company or any Guarantor shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or any Guarantor solely by virtue of being unsecured or by virtue of being secured on a first or junior Lien basis. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (18) above, or is entitled to be incurred pursuant to Section 4.09(a), the Company shall be permitted to divide and classify such item of Indebtedness on the date of its incurrence or later reclassify all or a portion of such item of Indebtedness in any manner that complies with this Section 4.09. Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by clause (8) of the definition of Permitted Debt. Indebtedness under Credit Facilities outstanding on the expiration date of the Escrow Period shall be deemed to have been incurred on such date in reliance on the exception provided by clause (1) or (2) of the definition of Permitted Debt, as applicable. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant; provided, in each such case, that the amount of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued. The amount of any Indebtedness outstanding as of any date shall be: (1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount; (2) the principal amount of the Indebtedness, in the case of any other Indebtedness; and (3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of: (a) the fair market value of such assets at the date of determination; and (b) the amount of the Indebtedness of the other Person. 66 For purposes of determining compliance with any U.S. dollar denominated restriction on the incurrence of Indebtedness where the Indebtedness incurred is denominated in a currency other than U.S. dollars, the amount of such Indebtedness shall be the U.S. Dollar Equivalent of such Indebtedness determined on the date of incurrence, provided that if any such Indebtedness denominated in a currency other than U.S. dollars is subject to a Currency Agreement with respect to U.S. dollars covering all principal, premium, if any, and interest payable on such Indebtedness, the amount of such Indebtedness expressed in U.S. dollars shall be as provided in such Currency Agreement. The principal amount of any Permitted Refinancing Indebtedness incurred in the same currency as the Indebtedness being refinanced shall be the U.S. Dollar Equivalent of the Indebtedness being refinanced, except to the extent that (a) such U.S. Dollar Equivalent was determined based on a Currency Agreement, in which case the Permitted Refinancing Indebtedness shall be determined in accordance with the preceding sentence, and (b) the principal amount of the Permitted Refinancing Indebtedness exceeds the principal amount of the Indebtedness being refinanced, in which case the U.S. Dollar Equivalent of such excess shall be determined on the date such Permitted Refinancing Indebtedness is incurred. Section 4.10 Asset Sales. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, consummate an Asset Sale (including a Sale of Senior Secured Note Priority Collateral) unless: (1) the Company (or the 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) if such Asset Sale, in any single transaction or series of related transactions, involves assets having a fair market value of greater than $15.0 million, such fair market value is determined by the Company's Board of Directors and evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee; (3) in the case of a Sale of Senior Secured Note Priority Collateral, the Collateral Agent is promptly granted a perfected first priority security interest (subject to Permitted Prior Liens) in the Net Collateral Proceeds therefor received by the Company or the Restricted Subsidiary as additional Senior Secured Note Priority Collateral under the Security Documents to secure the Senior Secured Note Obligations, and, in the case of cash or Cash Equivalents constituting Net Collateral Proceeds, such Net Collateral Proceeds must be deposited into a segregated account under the sole control of the Collateral Agent that includes only proceeds from the Sale of Senior Secured Note Priority Collateral and interest earned thereon (an "Asset Sale Proceeds Account") and is free from all other Liens (other than Permitted Prior Liens), all on terms and pursuant to arrangements reasonably satisfactory to the Collateral Agent in its reasonable determination (which may include, at the Collateral Agent's reasonable request, customary officers' certificates and legal opinions and shall include release provisions requiring the Collateral Agent to release deposits in the Asset Sale Proceeds Account as necessary to permit the Company or its Restricted Subsidiaries to apply such Net Collateral Proceeds in the manner described below, unless the Collateral Agent has received written notice that an Event of Default has occurred and is continuing); and (4) at least 75% of the consideration received in the Asset Sale by the Company or such Restricted Subsidiary is in the form of cash and Cash Equivalents. For purposes of this Section 4.10, each of the following shall be deemed to be cash: 67 (A) any liabilities, as shown on the Company's most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Note Guarantee) that are assumed by the transferee of any such assets pursuant to a customary agreement that releases the Company or such Restricted Subsidiary from further liability; and (B) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary within 45 days of receipt into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents received in that conversion. (b) Within 365 days after the receipt of any Net Proceeds from an Asset Sale, other than a Sale of Senior Secured Note Priority Collateral, the Company may apply such Net Proceeds to: (1) repay Indebtedness and other Obligations under a Credit Facility and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto; (2) acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated within 180 days after the end of such 365 day period) all or substantially all of the assets of, or a majority of the Voting Stock of, a Permitted Business or the minority interest in any Restricted Subsidiary; (3) make a capital expenditure; (4) acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated within 180 days after the end of such 365 day period) other long-term assets that are used or useful in a Permitted Business; or (5) make an offer to all Holders of Notes to purchase Notes at a purchase price equal to 100% of the principal amount of the Notes to be purchased plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, payable in cash. Pending the final application of any Net Proceeds from Asset Sales, other than a Sale of Senior Secured Note Priority Collateral, the Company may temporarily reduce revolving credit borrowings or otherwise invest such Net Proceeds in any manner that is not prohibited by this Indenture. (c) Any Net Proceeds from Asset Sales, other than a Sale of Senior Secured Note Priority Collateral, that are not applied or invested as provided in Section 4.10(b) shall constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company shall within five Business Days make an Asset Sale Offer to all Holders of Notes with the proceeds of sales of assets to purchase the maximum amount of Notes that may be purchased out of the Excess Proceeds. (d) The offer price in any Asset Sale Offer shall be equal to 100% of the principal amount of the Notes to be purchased plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, and shall be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company may use those Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes tendered into such Asset Sale Offer exceeds the 68 amount of Excess Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero. (e) Within 365 days after the receipt of any Net Collateral Proceeds from a Sale of Senior Secured Note Priority Collateral, the Company or the Restricted Subsidiary, as the case may be, may apply such Net Collateral Proceeds (other than any non-cash consideration representing Permitted Assets received by the Company in respect of any Sale of Senior Secured Note Priority Collateral; provided that the Collateral Agent shall promptly be granted a perfected first priority security interest (subject to Permitted Prior Liens) on all such assets as Senior Secured Note Priority Collateral under the Security Documents to secure the Notes on terms and pursuant to arrangements reasonably satisfactory to the Collateral Agent in its reasonable determination (which may include, at the Collateral Agent's reasonable request, customary officers' certificates and legal opinions)) at its option: (1) to acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and shall be consummated within 180 days after the end of such 365 day period) all or substantially all of the assets of, or a majority of the Voting Stock of, a Permitted Business principally owning Permitted Assets that have (in the good faith judgment of the Company) a value, net of the value of any Credit Facility Priority Collateral included therein, at least equal to the amount of such Net Collateral Proceeds; or (2) to make capital expenditures on or acquire (or enter into a binding agreement to acquire, provided that such commitment shall be subject only to customary conditions (other than financing) and shall be consummated within 180 days after the end of such 365 day period) Permitted Assets; provided, that in each such case, the Collateral Agent shall immediately be granted a perfected first priority security interest (subject to Permitted Prior Liens) on all of the assets (other than any Credit Facility Priority Collateral included therein) acquired with such Net Collateral Proceeds as Senior Secured Note Priority Collateral under the Security Documents to secure the Senior Secured Note Obligations, all on terms and pursuant to arrangements reasonably satisfactory to the Collateral Agent in its reasonable determination (which may include, at the Collateral Agent's reasonable request, customary officers' certificates and legal opinions). (f) Any Net Collateral Proceeds from any Sale of Senior Secured Note Priority Collateral that are not applied or invested as provided in Section 4.10(e) shall constitute "Excess Collateral Proceeds." When the aggregate amount of Excess Collateral Proceeds exceeds $10.0 million, the Company shall within five Business Days make an offer to all Holders of Notes (a "Collateral Proceeds Offer") with the proceeds of sales of assets to purchase the maximum principal amount of Notes that may be purchased out of the Excess Collateral Proceeds. The offer price in any Collateral Proceeds Offer shall be equal to 100% of principal amount plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, and shall be payable in cash. If any Excess Collateral Proceeds remain after consummation of a Collateral Proceeds Offer, the Company and its Restricted Subsidiaries may use any remaining Excess Collateral Proceeds, free and clear of any Liens created by any Security Documents or otherwise for the benefit of any Holder of Senior Secured Note Obligations, for any other purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes tendered into such Collateral Proceeds Offer exceeds the amount of Excess Collateral Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis. Upon completion of each Collateral Proceeds Offer, the amount of Excess Collateral Proceeds shall be reset at zero. 69 (g) The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of this Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Asset Sale provisions of this Indenture by virtue of such conflict. Section 4.11 Transactions with Affiliates. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each, an "Affiliate Transaction"), unless: (1) the Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person; and (2) the Company delivers to the trustee: (A) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $5.0 million, a resolution of the Board of Directors of the Company set forth in an Officers' Certificate certifying that such Affiliate Transaction complies with this Section 4.11 and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors; and (B) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $15.0 million, an opinion issued by an accounting, appraisal or investment banking firm of national standing as to the fairness to the Company of such Affiliate Transaction from a financial point of view or that such Affiliate Transaction is not materially less favorable to the Company and its Restricted Subsidiaries than would reasonably be expected to be obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person. (b) The following items shall not be deemed to be Affiliate Transactions and, therefore, shall not be subject to the provisions Section 4.11(a) hereof: (1) any employment agreement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business of the Company or such Restricted Subsidiary; (2) transactions between or among the Company and/or its Restricted Subsidiaries; (3) transactions with a Person (other than an Unrestricted Subsidiary of the Company) that is an Affiliate of the Company solely because the Company owns, directly or through a Restricted Subsidiary, an Equity Interest in, or controls, such Person; (4) payment of reasonable directors fees; 70 (5) the Pledge of Equity Interests of Unrestricted Subsidiaries to support the Indebtedness thereof; (6) loans and advances to employees made in the ordinary course of business consistent with past practices of the Company or such Restricted Subsidiary, as the case may be; (7) any agreement as in effect on the date of this Indenture and any amendment, modification, supplement, renewal, replacement or extension thereof (so long as such amendment, modification, supplement, renewal, replacement or extension is not materially less favorable to the holders of the Notes); (8) the issuance or sale of Equity Interests (other than Disqualified Stock) of the Company; (9) transactions between a Receivables Subsidiary and any Person in which the Receivables Subsidiary has an Investment; and (10) Restricted Payments that are permitted under Section 4.07 hereof or any Permitted Investment. Section 4.12 Liens. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind on any asset now owned or hereafter acquired, except Permitted Liens. (b) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly create, incur, assume or suffer to exist any Lien of any kind on any Credit Facility Priority Collateral securing any Credit Facility Obligation, unless the Company or such Restricted Subsidiary concurrently (1) grants a Lien of such kind, pursuant to a security document upon substantially the same terms but subject to the provisions set forth in the Intercreditor Agreement to the Collateral Agent for the benefit of the Holders of Senior Secured Note Obligations and (2) causes such Lien to be duly perfected. Section 4.13 Business Activities. The Company shall not, and shall not permit any Subsidiary to, engage in any business other than Permitted Businesses, except to such extent as would not be material to the Company and its Subsidiaries taken as a whole. Section 4.14 Corporate Existence. The Company shall do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, and the corporate, partnership or other existence of each of the Guarantors, in accordance with the respective organizational documents (as the same may be amended from time to time) of the Company or any such Guarantor; provided that this Section 4.14 will not prohibit the Company or any Guarantor from consummating any transaction not prohibited by Section 5.01 or 11.04 hereof. 71 Section 4.15 Offer to Repurchase Upon Change of Control. (a) Upon the occurrence of a Change of Control, the Company shall make an offer (a "Change of Control Offer") to each Holder to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of that Holder's Notes validly tendered in the Change of Control Offer at a purchase price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest and Liquidated Damages, if any, on the Notes repurchased to the date of purchase, subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date (the "Change of Control Payment"). Within 30 days following any Change of Control, the Company shall mail a notice to each Holder describing the transaction or transactions that constitute the Change of Control and stating: (1) that the Change of Control Offer is being made pursuant to this Section 4.15 and that all Notes tendered shall be accepted for payment; (2) the purchase price and the purchase date, which shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed (the "Change of Control Payment Date"); (3) that any Note not tendered shall continue to accrue interest; (4) that, unless the Company defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Payment Date; (5) that Holders electing to have any Notes purchased pursuant to a Change of Control Offer shall be required to surrender the Notes, with the form entitled "Option of Holder to Elect Purchase" attached to the Notes completed, or transfer by book-entry transfer, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date; (6) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that such Holder is withdrawing his election to have the Notes purchased; and (7) that Holders whose Notes are being purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof. The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Indenture relating to a Change of Control Offer, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Indenture by virtue of such compliance. (b) On the Change of Control Payment Date, the Company shall, to the extent lawful: 72 (1) accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer; (2) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered; and (3) deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers' Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company. The Paying Agent shall promptly mail (but in any case not later than five days after the Change of Control Payment Date) to each Holder of Notes properly tendered the Change of Control Payment for such Notes, and the Trustee shall promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that any new Note shall be in a principal amount of $1,000 or an integral multiple of $1,000. The Company shall publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. (c) Notwithstanding anything to the contrary in this Section 4.15, the Company shall not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 4.15 and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer, or (2) notice of redemption has been given pursuant to Section 3.07 hereof, unless and until there is a default in payment of the applicable redemption price. Section 4.16 Limitation on Sale and Leaseback Transactions. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided that the Company or any Restricted Subsidiary may enter into a sale and leaseback transaction if: (1) the Company or that Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction under any provision of Section 4.09 hereof and (b) incurred a Lien to secure such Indebtedness pursuant to Section 4.12 hereof; (2) the gross cash proceeds of that sale and leaseback transaction are at least equal to the fair market value, as determined in good faith by the Board of Directors and set forth in an Officers' Certificate delivered to the Trustee if such gross cash proceeds are more than $10.0 million, of the property that is the subject of that sale and leaseback transaction; and (3) the transfer of assets in that sale and leaseback transaction is permitted by, and, if such transfer is an Asset Sale, the Company applies the proceeds of such transaction in compliance with Section 4.10 hereof. Section 4.17 Payments for Consent. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any Holder of Notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be paid and is paid to all Holders of the Notes that 73 consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement. Section 4.18 Additional Guarantees and Liens. (a) If the Company or any of its Restricted Subsidiaries acquires or creates another Domestic Restricted Subsidiary after the date of this Indenture (except for Subsidiaries that have properly been designated as Unrestricted Subsidiaries in accordance with this Indenture for so long as they continue to constitute Unrestricted Subsidiaries) or any other Restricted Subsidiary guarantees or otherwise provides direct credit support for any Indebtedness of the Company or any Guarantor, then that Restricted Subsidiary (other than a Receivables Subsidiary) shall (1) execute a supplemental indenture and a joinder agreement to the Security Documents in form and substance reasonably satisfactory to the Trustee providing that such Restricted Subsidiary shall become a Guarantor under this Indenture and a party to the Security Documents and (2) deliver an Opinion of Counsel to the effect that such supplemental indenture and joinder agreement has been duly authorized and executed by such Restricted Subsidiary, in each case, within 10 Business Days following the date on which it was acquired or created; provided that any Domestic Restricted Subsidiary that constitutes an Immaterial Subsidiary need not become a Guarantor until such time as it ceases to be an Immaterial Subsidiary. The form of such Note Guarantee is attached as Exhibit E hereto. (b) If the Company or any of the Guarantors at any time (1) owns or acquires Senior Secured Note Priority Collateral that is not subject to a valid, enforceable perfected first priority Lien (subject to Permitted Prior Liens) in favor of the Collateral Agent as security for the Senior Secured Note Obligations or (2) grants, assumes or becomes subject to any Lien upon any of its property that constitutes Credit Facility Priority Collateral as security for any Credit Facility Obligation, then the Company shall, or shall cause such Guarantor to, concurrently: (A) execute and deliver to the Collateral Agent a security document upon substantially the same terms as the Security Documents delivered in connection with the issuance of the Notes, granting, in the case of any Senior Secured Note Priority Collateral, a first priority Lien upon such Senior Secured Note Priority Collateral or, in the case of any Credit Facility Priority Collateral, a second priority Lien upon such Credit Facility Priority Collateral, in either case, in favor of the Collateral Agent for the benefit of the Holders of the Senior Secured Note Obligations; and (B) cause any such Lien granted in such security document to be duly perfected in any manner permitted by law and, in the case of any Senior Secured Note Priority Collateral, cause each other Lien upon such Senior Secured Note Priority Collateral to be (1) released, unless it is a Permitted Lien or (2) subordinated to the Senior Secured Note Liens if it is a Permitted Lien but not a Permitted Prior Lien. Section 4.19 Designation of Restricted and Unrestricted Subsidiaries. The Board of Directors of the Company may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default, provided, that in no event may the Board of Directors designate any (a) Restricted Subsidiary that holds assets constituting Senior Secured Note Priority Collateral having a fair value of greater than $5.0 million or (b) group of Restricted Subsidiaries that together hold assets constituting Senior Secured Note Priority Collateral having a fair value of greater than $5.0 million, to be an Unrestricted Subsidiary or Unrestricted Subsidiaries, as the case may be. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the 74 Subsidiary properly designated shall be deemed to be an Investment made as of the time of the designation and shall reduce the amount available for Restricted Payments under Section 4.07(a) or Permitted Investments, as determined by the Company. That designation shall only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Board of Directors of the Company may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would not cause a Default. Section 4.20 Escrow Account Deposits Upon consummation of the sale of the Initial Notes, the Company shall deposit the gross proceeds of the Notes offering into the Escrow Account with the Escrow Agent. Section 4.21 Activities of the Company Prior to the Escrow Merger Prior to the Escrow Merger, the Company shall be a limited purpose corporation whose primary activities are restricted in its certificate of incorporation to issuing the Notes, issuing capital stock to, and receiving capital contributions from, Milacron, performing its obligations with respect to the Notes under this Indenture, the Escrow Agreement and the Registration Rights Agreement, and consummating the Escrow Merger or redeeming the Notes on the Escrow Redemption Date, as applicable, and conducting such other activities as are necessary or appropriate to carry out the activities described above. Prior to the Escrow Merger, the Company shall not own, hold or otherwise have any interest in any assets other than the Escrow Account and, cash, Cash Equivalents or Government Securities. Prior to the Escrow Merger, not less than two members of the Company's Board of Directors (the "Independent Directors") shall be individuals who are not, and never have been, direct, indirect or beneficial stockholders, officers, directors, employees, affiliates, associates, material suppliers or material customers of Milacron or any of its Affiliates, and the certificate of incorporation of the Company shall provide that (1) at least two members of the Company's Board of Directors shall be an Independent Director, (2) the Company's Board of Directors shall not approve, or take any other action to cause the filing of, a voluntary bankruptcy petition with respect to the Company without the unanimous vote of the entire Board of Directors without any vacancies (including the Independent Directors) and (3) the provisions requiring two independent directors and the provision described in clauses (1) and (2) above cannot be amended without the prior written consent of the Independent Directors. Neither Independent Director shall at any time serve as a trustee in bankruptcy for the Company or any Affiliate thereof. Any director, employee, consultant or agent of the Company shall be compensated from the Company's funds for services provided to the Company. The Company shall not engage any agents (other than its attorneys, auditors and other professionals). The Company shall keep correct and complete books and records of account and minutes of the meetings and other proceedings of its stockholder and board of directors, as applicable, and the resolutions, agreements and other instruments of the Company shall be continuously maintained as official records by the Company. The Company shall strictly observe organizational formalities in its dealings with Milacron and its Affiliates, and funds or other assets of the Company shall not be commingled with those of any of its Affiliates. No Affiliate of the Company shall maintain joint bank accounts with the Company or other depository accounts with the Company to which any such Affiliate has independent access. The Company's operating expenses shall not be paid by Milacron or any other Affiliate of the Company, and the Company shall have its own stationary. The Company shall conduct its business solely in its own legal name and in a manner separate from Milacron so as not to mislead others with whom it is dealing. 75 The books of account, financial reports and records of the Company shall be maintained separately from those of Milacron and each other Affiliate of the Company, although they may appear in Milacron's consolidated general ledger. Any financial statements of Milacron or an Affiliate thereof which are consolidated to include the Company shall contain detailed notes clearly stating that (1) all of the Company's assets are owned by the Company, and (2) the Company is a separate legal entity with its own separate creditors that shall be entitled to be satisfied out of the Company's assets prior to any value in the Company becoming available to the Company's equity holders. The Company's assets shall be maintained in a manner that facilitates their identification and segregation from those of Milacron and its other Affiliates. The Company shall maintain arm's length relationships with its Affiliates, and each Affiliate of the Company that renders or otherwise furnishes services or merchandise to the Company shall be compensated by the Company at market rates for such services or merchandise. The Company shall not incur any material indirect or overhead expenses for items shared with Milacron (or any other Affiliate thereof) or any fees for legal, auditing and other professional services and directors' fees, in each case that are not reflected in a service agreement between the Company and Milacron pursuant to which a fee shall be paid to Milacron for any such expenses; it being understood that Milacron shall pay the expenses relating to the offering of the Notes. No Affiliate of the Company shall be, nor shall it hold itself out to be, responsible for the debts of the Company or the decisions or actions in respect of the daily business and affairs of the Company. The Company shall immediately correct any known misrepresentation with respect to the foregoing and shall not operate or purport to operate as an integrated single economic unit with respect to Milacron or in its dealing with any other entity. ARTICLE 5 SUCCESSORS Section 5.01 Merger, Consolidation, or Sale of Assets. The Company may not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not the Company 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 Company and its Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person; unless: (1) either: (A) the Company is the surviving corporation; or (B) the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, conveyance or other disposition has been made is a Person organized or existing under the laws of the United States, any state of the United States or the District of Columbia (any such Person, the "Successor Company"); (2) the Successor Company assumes all the obligations of the Company under the Notes, this Indenture, the Security Documents and, if then in effect, the Registration Rights Agreement pursuant to agreements reasonably satisfactory to the Trustee; (3) immediately after such transaction, no Default exists; and 76 (4) the Company or the Successor Company, as the case may be, would on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable four-quarter period: (A) be permitted to incur at least $1.00 of additional Indebtedness pursuant to Section 4.09 hereof or (B) have a Fixed Charge Coverage Ratio that is no worse than the Fixed Charge Coverage Ratio of the Company immediately preceding such consolidation, merger, sale, assignment, transfer, conveyance or other disposition. The foregoing clause (4) of this Section 5.01 will not prohibit: (1) the Escrow Merger; or (2) a merger between the Company and any of its Restricted Subsidiaries; or (3) a merger between the Company and an Affiliate of the Company incorporated solely for the purpose of reincorporating the Company in another state of the United States, so long as the amount of Indebtedness of the Company and its Restricted Subsidiaries is not increased thereby. In addition, the Company may not, directly or indirectly, lease all or substantially all of its properties or assets, in one or more related transactions, to any other Person. This Section 5.01 will not apply to a sale, assignment, transfer, conveyance or other disposition of assets between or among the Company, any of its Wholly Owned Restricted Subsidiaries and any of the Guarantors. Section 5.02 Successor Company Substituted. Upon any consolidation or merger with, or any sale, assignment, transfer, lease, conveyance or other disposition of all or substantially all of the properties or assets of the Company to a Successor Company in a transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof, the Successor Company shall succeed to, and be substituted for (so that from and after the date of such consolidation, merger, sale, assignment, transfer, lease, conveyance or other disposition, the provisions of this Indenture referring to the "Company" shall refer instead to the Successor Company), and may exercise every right and power of the Company under this Indenture with the same effect as if such Successor Company had been named as the Company herein; provided, however, that the predecessor Company shall not be relieved from the obligation to pay the principal of and interest on the Notes except in the case of a sale of substantially all of the properties or assets of the Company and its Restricted Subsidiaries taken as a whole in a transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof. ARTICLE 6 DEFAULTS AND REMEDIES Section 6.01 Events of Default. Each of the following is an "Event of Default": (1) default for 30 days in the payment when due of interest on, or Liquidated Damages with respect to, the Notes; 77 (2) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the Notes; (3) failure by the Company to comply with its obligations under Sections 4.10, 4.15, 4.21 or 5.01 hereof; (4) failure by the Company or any of its Restricted Subsidiaries for 30 days after receipt by the Company of written notice by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class to comply with the provisions of Sections 4.07 and 4.09; (5) failure by the Company or any of its Restricted Subsidiaries for 60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class to comply with any of the other agreements in this Indenture, the Escrow Agreement, the Notes or the Security Documents; (6) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its Restricted Subsidiaries) whether such Indebtedness or guarantee now exists, or is created after the date of this Indenture, if that default: (A) is caused by a failure to pay principal of such Indebtedness (after giving effect to any applicable grace period provided in such Indebtedness) on the date of its Stated Maturity (a "Payment Default"); or (B) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $15.0 million or more; (7) failure by the Company or any of its Restricted Subsidiaries to pay final, non-appealable judgments entered by a court or courts of competent jurisdiction aggregating in excess of $15.0 million, which judgments are not paid, discharged or stayed for a period of 60 days; (8) the Escrow Agreement or any other Security Document or any Lien purported to be granted thereby on the Escrow Account or the cash therein, the Eurobond Escrow Agreement or any other security document or any Lien purposed to be granted thereby on the Eurobond Escrow Account, or the cash therein, or any one or more other items of Collateral having an aggregate fair market value in excess of $15.0 million is held in any judicial proceeding to be unenforceable or invalid, in whole or in part, or ceases for any reason (other than pursuant to a release that is delivered or becomes effective as set forth in this Indenture) to be fully enforceable and perfected; provided that if the holders of the Series B Notes and the common stock into which the Series A Notes were converted waive the requirement in the Note Purchase Agreement for the establishment of the Eurobond Escrow Account, then the failure to establish the Eurobond Escrow Account or execute the Eurobond Escrow Agreement (or the termination of the Eurobond Escrow Agreement and dissolution of the Eurobond Escrow Account) shall not be deemed an Event of Default; 78 (9) the Company or any Guarantor denies or disaffirms, in writing in any pleading in any court of competent jurisdiction, any obligation of the Company or any Guarantor set forth in or arising under any Security Document; (10) except as permitted by this Indenture, any Note Guarantee shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect and such default continues for 10 days after notice by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class or any Guarantor, or any Person acting on behalf of any Guarantor, shall deny or disaffirm its obligations under its Note Guarantee in writing; (11) the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries of the Company that, taken together, would constitute a Significant Subsidiary pursuant to or within the meaning of Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a custodian of it or for all or substantially all of its property, (D) makes a general assignment for the benefit of its creditors, or (E) generally is not paying its debts as they become due; (12) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries of the Company that, taken together, would constitute a Significant Subsidiary in an involuntary case; (B) appoints a custodian of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries of the Company that, taken together, would constitute a Significant Subsidiary or for all or substantially all of the property of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries of the Company that, taken together, would constitute a Significant Subsidiary; or (C) orders the liquidation of the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries of the Company that, taken together, would constitute a Significant Subsidiary; and the order or decree remains unstayed and in effect for 60 consecutive days. Section 6.02 Acceleration. In the case of an Event of Default specified in clause (11) or (12) of Section 6.01 hereof, with respect to the Company, any Restricted Subsidiary of the Company that is a Significant Subsidiary or any group of Restricted Subsidiaries of the Company that, taken together, would constitute a Significant 79 Subsidiary, all outstanding Notes will become due and payable immediately without further action or notice. If any other Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately. Upon any such declaration, the Notes shall become due and payable immediately. The Holders of a majority in aggregate principal amount of the then outstanding Notes by written notice to the Trustee may, on behalf of all of the Holders, rescind an acceleration and its consequences, if the rescission would not conflict with any judgment or decree and if all existing Events of Default (except nonpayment of principal, interest or premium or Liquidated Damages, if any, that has become due solely because of the acceleration) have been cured or waived. Section 6.03 Other Remedies. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium and Liquidated Damages, if any, and interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of a Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. Section 6.04 Waiver of Past Defaults. Holders of not less than a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may on behalf of the Holders of all of the Notes waive an existing Default or Event of Default and its consequences hereunder, except a continuing Default or Event of Default in the payment of the principal of, premium and Liquidated Damages, if any, or interest on, the Notes (including in connection with an offer to purchase); provided, however, that the Holders of a majority in aggregate principal amount of the then outstanding Notes may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon. Section 6.05 Control by Majority. Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be unduly prejudicial to the rights of other Holders of Notes or that may involve the Trustee in personal liability. Section 6.06 Limitation on Suits. A Holder may pursue a remedy with respect to this Indenture or the Notes only if: (1) such Holder gives to the Trustee written notice that an Event of Default is continuing; 80 (2) Holders of at least 25% in aggregate principal amount of the then outstanding Notes make a written request to the Trustee to pursue the remedy; (3) such Holder or Holders offer and, if requested, provide to the Trustee security or indemnity reasonably satisfactory to the Trustee against any loss, liability or expense; (4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and (5) during such 60-day period, Holders of a majority in aggregate principal amount of the then outstanding Notes do not give the Trustee a direction inconsistent with such request. A Holder of a Note may not use this Indenture to prejudice the rights of another Holder of a Note or to obtain a preference or priority over another Holder of a Note. Section 6.07 Rights of Holders of Notes to Receive Payment. Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to receive payment of principal, premium and Liquidated Damages, if any, and interest on the Note, on or after the respective due dates expressed in the Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder; provided that a Holder shall not have the right to institute any such suit for the enforcement of payment if and to the extent that the institution or prosecution thereof or the entry of judgment therein would, under applicable law, result in the surrender, impairment, waiver or loss of the Lien of this Indenture upon any property subject to such Lien. Section 6.08 Collection Suit by Trustee. If an Event of Default specified in Section 6.01(1) or (2) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal of, premium and Liquidated Damages, if any, and interest remaining unpaid on, the Notes and interest on overdue principal and, to the extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. Section 6.09 Trustee May File Proofs of Claim. The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders of the Notes allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and 81 other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. Section 6.10 Priorities. If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order: First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection; Second: to Holders of Notes for amounts due and unpaid on the Notes for principal, premium and Liquidated Damages, if any, and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium and Liquidated Damages, if any and interest, respectively; and Third: to the Company or to such party as a court of competent jurisdiction shall direct. The Trustee may fix a record date and payment date for any payment to Holders of Notes pursuant to this Section 6.10. 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 a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in aggregate principal amount of the then outstanding Notes. ARTICLE 7 TRUSTEE Section 7.01 Duties of Trustee. (a) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. (b) Except during the continuance of an Event of Default: (1) the duties of the Trustee will be determined solely by the express provisions of this Indenture and the Trustee need perform only those duties that are specifically set forth in this 82 Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee will examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture. (c) The Trustee may not be relieved from liabilities for its own 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 will not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and (3) the Trustee will not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 hereof. (d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), and (c) of this Section 7.01. (e) No provision of this Indenture will require the Trustee to expend or risk its own funds or incur any liability. The Trustee will be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder has offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense. (f) The Trustee will not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. Section 7.02 Rights of Trustee. (a) The Trustee may conclusively rely upon any document (whether in its original or facsimile form) believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document. (b) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate or an Opinion of Counsel or both. The Trustee will not be liable for any action it takes or omits to take in good faith in reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel will be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon. (c) The Trustee may act through its attorneys and agents and will not be responsible for the misconduct or negligence of any agent appointed with due care. (d) The Trustee will not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Indenture. 83 (e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company will be sufficient if signed by an Officer of the Company. (f) The Trustee will be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee reasonable indemnity or security against the losses, liabilities and expenses that might be incurred by it in compliance with such request or direction. Section 7.03 Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the SEC for permission to continue as trustee (if this Indenture has been qualified under the TIA) or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof. Section 7.04 Trustee's Disclaimer. The Trustee will not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Company's use of the proceeds from the Notes or any money paid to the Company or upon the Company's direction under any provision of this Indenture, it will not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it will not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication. Section 7.05 Notice of Defaults. If a Default or Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of Notes a notice of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium or Liquidated Damages, if any, or interest on, any Note, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders of the Notes. Section 7.06 Reports by Trustee to Holders of the Notes. (a) Within 60 days after each May 15 beginning with the May 15 following the date of this Indenture, and for so long as Notes remain outstanding, the Trustee will mail to the Holders of the Notes a brief report dated as of such reporting date that complies with TIA Section 313(a) (but if no event described in TIA Section 313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also will comply with TIA Section 313(b)(2). The Trustee will also transmit by mail all reports as required by TIA Section 313(c). (b) A copy of each report at the time of its mailing to the Holders of Notes will be mailed by the Trustee to the Company and filed by the Trustee with the SEC and each stock exchange on which the Notes are listed in accordance with TIA Section 313(d). The Company will promptly notify the Trustee when the Notes are listed on any stock exchange. Section 7.07 Compensation and Indemnity. 84 (a) The Company will pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder. The Trustee's compensation will not be limited by any law on compensation of a trustee of an express trust. The Company will reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses will include the reasonable compensation, disbursements and expenses of the Trustee's agents and counsel. (b) The Company and the Guarantors will indemnify the Trustee against any and all losses, liabilities or expenses incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Company and the Guarantors (including this Section 7.07) and defending itself against any claim (whether asserted by the Company, the Guarantors, any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent any such loss, liability or expense may be attributable to its negligence or bad faith. The Trustee will notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company will not relieve the Company or any of the Guarantors of their obligations hereunder. The Company or such Guarantor will defend the claim and the Trustee will cooperate in the defense. The Trustee may have separate counsel and the Company will pay the reasonable fees and expenses of such counsel. Neither the Company nor any Guarantor need pay for any settlement made without its consent, which consent will not be unreasonably withheld. Neither the Company nor any Guarantor need reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through its own negligence, willful misconduct or bad faith. (c) The obligations of the Company and the Guarantors under this Section 7.07 will survive the satisfaction and discharge of this Indenture. (d) To secure the Company's and the Guarantors' payment obligations in this Section 7.07, the Trustee will have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Notes. Such Lien will survive the satisfaction and discharge of this Indenture. (e) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(11) or (12) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law. (f) The Trustee will comply with the provisions of TIA Section 313(b)(2) to the extent applicable. Section 7.08 Replacement of Trustee. (a) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee's acceptance of appointment as provided in this Section 7.08. (b) The Trustee may resign in writing at any time and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in aggregate principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee by so notifying the Trustee. The Company shall remove the Trustee if: (1) the Trustee fails to comply with Section 7.10 hereof; 85 (2) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law; (3) a custodian or public officer takes charge of the Trustee or its property; or (4) the Trustee becomes incapable of acting. (c) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company will promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in aggregate principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company. (d) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of at least 10% in aggregate principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee. (e) If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10 hereof, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. (f) A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee will mail a notice of its succession to Holders. The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee; provided all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company's obligations under Section 7.07 hereof will continue for the benefit of the retiring Trustee. Section 7.09 Successor Trustee by Merger, etc. If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act will be the successor Trustee. Section 7.10 Eligibility; Disqualification. There will at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $100.0 million as set forth in its most recent published annual report of condition. This Indenture will always have a Trustee who satisfies the requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to TIA Section 310(b). Section 7.11 Preferential Collection of Claims Against Company. 86 The Trustee is subject to TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated therein. ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance. The Company may at any time, at the option of its Board of Directors evidenced by a resolution set forth in an Officers' Certificate, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article 8. Section 8.02 Legal Defeasance and Discharge. Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Company and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from their obligations with respect to all outstanding Notes (including the Note Guarantees) on the date the conditions set forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means that the Company and the Guarantors will be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes (including the Note Guarantees), which will thereafter be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the other Sections of this Indenture referred to in clauses (1) and (2) below, and to have satisfied all their other obligations under such Notes, the Note Guarantees and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which will survive until otherwise terminated or discharged hereunder: (1) the rights of Holders of outstanding Notes to receive payments in respect of the principal of, or interest or premium and Liquidated Damages, if any, on, such Notes when such payments are due from the trust referred to in Section 8.04 hereof; (2) the Company's obligations with respect to such Notes under Article 2 and Section 4.02 hereof; (3) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company's and the Guarantors' obligations in connection therewith; and (4) this Article 8. Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 hereof. Section 8.03 Covenant Defeasance. Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Company and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from each of their obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19, 4.20, and 4.21 hereof and clause (4) of Section 5.01 hereof with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.04 hereof are satisfied (hereinafter, "Covenant Defeasance"), and the Notes will 87 thereafter be deemed not "outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but will continue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Notes will not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes and Note Guarantees, the Company and the Guarantors may omit to comply with and will have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply will not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes and Note Guarantees will be unaffected thereby. In addition, upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, Sections 6.01(3) through 6.01(6) hereof will not constitute Events of Default. Section 8.04 Conditions to Legal or Covenant Defeasance. In order to exercise either Legal Defeasance or Covenant Defeasance under either Section 8.02 or 8.03 hereof: (1) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities, 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 Liquidated Damages, if any, on the outstanding Notes on the stated maturity or on the applicable redemption date, as the case may be, and the Company must specify whether the Notes are being defeased to maturity or to a particular redemption date; (2) in the case of Legal Defeasance only, the Company has delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that: (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling; or (B) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel will confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred; (3) in the case of Covenant Defeasance only, the Company has delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; (4) no Default 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); 88 (5) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than this Indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound; (6) the Company must deliver to the Trustee an Officers' Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders of Notes over the other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; and (7) the Company 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 8.05 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions. Subject to Section 8.06 hereof, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes will be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium and Liquidated Damages, if any, and interest, but such money need not be segregated from other funds except to the extent required by law. The Company will pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes. Notwithstanding anything in this Article 8 to the contrary, the Trustee will deliver or pay to the Company from time to time upon the request of the Company any money or non-callable Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.04(1) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance. Section 8.06 Repayment to Company. Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium or Liquidated Damages, if any, or interest on, any Note and remaining unclaimed for two years after such principal, premium or Liquidated Damages, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) will be discharged from such trust; and the Holder of such Note will thereafter be permitted to look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, will thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national edition), notice that such money remains unclaimed and that, after a 89 date specified therein, which will not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Company. Section 8.07 Reinstatement. If the Trustee or Paying Agent is unable to apply any U.S. dollars or non-callable Government Securities in accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's and the Guarantors' obligations under this Indenture and the Notes and the Note Guarantees will be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided, however, that, if the Company makes any payment of principal of, premium or Liquidated Damages, if any, or interest on, any Note following the reinstatement of its obligations, the Company will be subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying Agent. ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER Section 9.01 Without Consent of Holders of Notes. Notwithstanding Section 9.02 of this Indenture, the Company, the Guarantors and the Trustee may amend or supplement this Indenture or the Notes or the Note Guarantees without the consent of any Holder of Note: (1) to cure any ambiguity, defect or inconsistency or to make a modification of a formal, minor or technical nature or correct a manifest error; (2) to provide for uncertificated Notes in addition to or in place of Certificated Notes; (3) to provide for the assumption of the Company's or any Guarantor's obligations to Holders of Notes in the case of a merger or consolidation or sale of all or substantially all of the Company's assets; (4) to add to the covenants of the Company or any Guarantor for the benefit of Holders of the Notes or surrender any right or power conferred upon the Company or any Guarantor; (5) to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect the legal rights under this Indenture of any such Holder; (6) to comply with any requirement of the SEC in connection with the qualification of this Indenture under the Trust Indenture Act; (7) to add any additional Guarantor or to release any Guarantor from its Note Guarantee, to evidence or provide for the acceptance of appointment of a successor trustee or to add any additional Events of Default, in each case, as provided in this Indenture; (8) to make, complete or confirm any grant of a security interest in any Collateral permitted or required by the Security Documents or this Indenture or any release of Collateral that becomes effective as set forth in the Security Documents or this Indenture; 90 (9) to conform the text of this Indenture, the Note Guarantees, the Intercreditor Agreement, the other Security Documents or the Notes to any provision of the "Description of Senior Secured Notes" section of the Offering Circuler, to the extent that such provision in that "Description of Senior Secured Notes" was intended to be a verbatim recitation of a provision of this Indenture, the Note Guarantees, the Intercreditor Agreement, the other Security Documents or the Notes; (10) to comply with Sections 5.01 and 4.10 hereof; (11) to reflect any waiver or termination of any right arising under the provisions of the Intercreditor Agreement that otherwise would be enforceable by any holder of a Credit Facility Lien, if such waiver or termination is set forth or provided in this Indenture, any of the Security Documents or the agreement governing or giving rise to such Credit Facility Lien, provided that no such waiver or amendment pursuant to this clause (11) shall adversely affect the rights of Holders of the Notes; and (12) to release Collateral constituting Excluded Securities in accordance with the conditions set forth in the definition of Excluded Assets. Upon the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental indenture, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join with the Company and the Guarantors in the execution of any amended or supplemental indenture authorized or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee will not be obligated to enter into such amended or supplemental indenture that affects its own rights, duties or immunities under this Indenture or otherwise. Section 9.02 With Consent of Holders of Notes. Except as provided below in this Section 9.02, the Company and the Trustee may amend or supplement this Indenture (including, without limitation, Section 3.09, 4.10 and 4.15 hereof) and the Notes and the Note Guarantees with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes (including, Additional Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium or Liquidated Damages, if any, or interest on, the Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Indenture or the Notes or the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes (including, Additional Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, the Notes). Section 2.08 hereof shall determine which Notes are considered to be "outstanding" for purposes of this Section 9.02. Upon the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental indenture, and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join with the Company and the Guarantors in the execution of such amended or supplemental indenture unless such amended or supplemental indenture directly affects the Trustee's own rights, duties or immunities under 91 this Indenture or otherwise, in which case the Trustee may in its discretion, but will not be obligated to, enter into such amended or supplemental Indenture. It is not be necessary for the consent of the Holders of Notes under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof. After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Company will mail to the Holders of Notes affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, will not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a majority in aggregate principal amount of the Notes then outstanding voting as a single class may waive compliance in a particular instance by the Company with any provision of this Indenture or the Notes or the Note Guarantees. However, without the consent of each Holder affected, an amendment, supplement or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder): (1) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver; (2) reduce the principal of or change the fixed maturity of any Note or alter the provisions with respect to the redemption of the Notes (except as provided above with respect to Sections 3.09, 4.10 and 4.15 hereof); (3) reduce the rate of or change the time for payment of interest, including default interest, on any Note; (4) waive a Default in the payment of principal of, or interest or premium, or Liquidated Damages, if any, on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the then outstanding Notes and a waiver of the payment default that resulted from such acceleration); (5) make any Note payable in money other than that stated in the Notes; (6) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders of Notes to receive payments of principal of, or interest or premium or Liquidated Damages, if any, on, the Notes; (7) waive a redemption payment with respect to any Note (other than a payment required by Sections 3.09, 4.10 or 4.15 hereof); or (8) make any change in the preceding amendment and waiver provisions. In addition, any amendment to, or waiver of, the provisions of this Indenture to release all or substantially all of the Collateral from the Liens securing the Notes or to release any Guarantor from any of its obligations under its Note Guarantee or this Indenture, except in accordance with the terms of this Indenture, will require the consent of the Holders of at least 66-2/3% in aggregate principal amount of the Notes then outstanding. Further, no amendment or supplement that imposes any obligation on the Trustee or the Collateral Agent or adversely affect the rights of the Trustee or the Collateral Agent in its individual capacity shall become effective without the consent of such party. 92 Section 9.03 Compliance with Trust Indenture Act. Every amendment or supplement to this Indenture or the Notes will be set forth in a amended or supplemental indenture that complies with the TIA as then in effect. Section 9.04 Revocation and Effect of Consents. Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder's Note, even if notation of the consent is not made on any Note. However, any such Holder of a Note or subsequent Holder of a Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder. Section 9.05 Notation on or Exchange of Notes. The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver. Failure to make the appropriate notation or issue a new Note will not affect the validity and effect of such amendment, supplement or waiver. Section 9.06 Trustee to Sign Amendments, etc. The Trustee will sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. In executing any amended or supplemental indenture, the Trustee will be entitled to receive and (subject to Section 7.01 hereof) will be fully protected in relying upon, in addition to the documents required by Section 12.04 hereof, an Officers' Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture. ARTICLE 10 COLLATERAL AND SECURITY Section 10.01. Collateral Documents. The due and punctual payment of the principal of and interest and Liquidated Damages, if any, on the Notes when and as the same shall be due and payable, whether on an interest payment date, at maturity, by acceleration, repurchase, redemption or otherwise, and, to the extent permitted by law, interest on the overdue principal of and interest and Liquidated Damages, if any, on the Notes and the Note Guarantees and performance of all other obligations of the Company and the Guarantors to the Holders of Notes or the Trustee under this Indenture, the Notes and the Note Guarantees, according to the terms hereunder or thereunder, will be secured as provided in the Senior Secured Note Documents constituting Security Documents (the "Note Security Documents") which the Company and the Guarantors, as applicable, will enter into concurrently with the expiration of the Escrow Period and the consummation of the Escrow Merger. Each Holder of Notes, by its acceptance thereof, consents and agrees to the terms of the Note Security Documents (including, without limitation, the provisions providing for foreclosure and release of the Collateral) as the same may be in effect or may be amended 93 from time to time in accordance with its terms and authorizes and directs the Trustee for the benefit of the Holders of Notes and the Collateral Agent to enter into the Note Security Documents and to perform their respective obligations and exercise their respective rights thereunder in accordance therewith. The Company and each of the Guarantors will do or cause to be done all acts and things that may be required, or that the Collateral Agent from time to time may reasonably request, to assure and confirm that the Collateral Agent holds, for the benefit of the holders of Senior Secured Note Obligations, duly created and enforceable and perfected Liens upon the Collateral, including any property or assets that are acquired or otherwise become Collateral after the Notes are issued, subject to Permitted Prior Liens in the case of Senior Secured Note Priority Collateral, and to Credit Facility Liens and other Liens, if any, permitted by the applicable Qualified Credit Facility to be prior to the Credit Facility Liens in the case of Credit Facility Priority Collateral, in each case, as contemplated hereby and by the Senior Secured Note Documents. Upon the reasonable request of the Collateral Agent or the trustee at any time and from time to time, the Company and each of the Guarantors will promptly execute, acknowledge and deliver such security documents, instruments, certificates, notices and other documents, and take such other actions as shall be reasonably required, or that the Collateral Agent may reasonably request, to create, perfect, protect, assure or enforce the Liens and benefits intended to be conferred, in each case as contemplated by the Senior Secured Note Documents for the benefit of the holders of Senior Secured Note Obligations. Section 10.02. Recording and Opinions. (a) The Company will furnish to the Collateral Agent and the Trustee on May 15 in each year beginning with May 15, 2005, an Opinion of Counsel, which may be rendered by internal counsel to the Company, dated as of such date, either: (1) to the effect that, in the opinion of such counsel, subject to customary qualifications, such action has been taken with respect to the recordings, registerings, filings, re-recordings, re-registerings and refilings of this Indenture, the Note Security Documents and all financing statements, continuation statements or other instruments of further assurance as is necessary to maintain the Lien of the Note Security Documents in the Collateral and reciting with respect to the security interest in such Collateral the details of such action or referencing to prior Opinions of Counsel in which such details are given; or (2) to the effect that, in the opinion of such Counsel, subject to customary qualifications, no such action is necessary to maintain such Lien. (b) The Company will otherwise comply with the provisions of TIA Section 314(b). Section 10.03. Release of Collateral. (a) Subject to the provisions of this Section 10.03, Collateral may be released from the Lien and security interest created by the Note Security Documents at any time or from time to time in accordance with the provisions of the Note Security Documents or as provided by this Indenture. Collateral will be released from the Lien and security interest created by the Note Security Documents upon the occurrence of any of the following events: (1) in whole, upon payment in full of the Notes and all other Senior Secured Note Obligations that are outstanding, due and payable at the time the Notes are paid in full; (2) upon satisfaction and discharge of this Indenture as set forth in Article 12 hereof; 94 (3) upon a Legal Defeasance or Covenant Defeasance as set forth in Article 8 hereof; (4) as to any Collateral that constitutes all or substantially all of the Collateral, with the consent of the Holders of 66-2/3% in principal amount of the Notes then outstanding (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, the Notes); (5) as to any Collateral that constitutes less than all or substantially all of the Collateral, with the consent of the Holders of a majority in principal amount of the Notes then outstanding (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, the notes); (6) automatically as to any Collateral that is sold, transferred or otherwise disposed of by the Company or any other Obligor to a Person that is not (either immediately before or after such sale, transfer or disposition) the Company or a Restricted Subsidiary of the Company in a transaction or other circumstance that is not prohibited by Section 4.10 hereof and is not prohibited by all of the other Senior Secured Note Documents, at the time of such sale, transfer or other disposition or to the extent of the interest sold, transferred or otherwise disposed of; provided that the Collateral Agent's Liens upon the Collateral will not be released if the sale or disposition is prohibited by Section 5.01 hereof; (7) automatically as to any Collateral owned by any Guarantor all of the Capital Stock of which is being sold, transferred or otherwise being disposed of to a Person that is not (either immediately before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company in a transaction that does not violate Section 4.10 hereof, at the time of such sale, transfer or other disposition; (8) automatically as to any Collateral owned by any Restricted Subsidiary that is a Guarantor, upon (a) the designation of such Restricted Subsidiary as an Unrestricted Subsidiary in accordance with the applicable provisions of this Indenture or (b) if such Restricted Subsidiary is not a Domestic Restricted Subsidiary, when it ceases to be a guarantor or otherwise provide direct credit support for any other Indebtedness of the Company or any Guarantor; (9) automatically as to any Credit Facility Priority Collateral, in the event of any private or public sale of all or any portion of such Credit Facility Priority Collateral in connection with any Exercise of Remedies by or with the consent of the Credit Facility Agent at any time prior to the date upon which the Discharge of Credit Facility Obligations shall have occurred (and irrespective of whether an Event of Default has occurred), so long as the net cash proceeds of any such sale are applied as set forth under the Intercreditor Agreement; (10) as to Excluded Securities, in accordance with the conditions set forth in the definition of Excluded Assets; and (11) as to any Credit Facility Priority Collateral, upon delivery of certification to the Trustee and the Collateral Agent by a Credit Facility Agent to the effect that such Credit Facility Priority Collateral has been released by the requisite number of holders of the Credit Facility Obligations in accordance with the terms of the Credit Facility Documents; provided that at the time of such release, the aggregate principal amount of Credit Facility Debt outstanding (including outstanding letters of credit, whether or not then available or drawn) and the aggregate unfunded commitments to extend credit that, when funded, would constitute Credit Facility Debt must exceed $25 million. 95 Upon receipt of an Officers' Certificate certifying that all conditions precedent to such release have been met, the Collateral Agent shall execute, deliver or acknowledge any necessary or proper instruments of termination, satisfaction or release to evidence the release of any Senior Secured Note Priority Collateral or the Credit Facility Priority Collateral permitted to be released pursuant to this Indenture or the Note Security Documents. (b) At any time when a Default or Event of Default has occurred and is continuing and the maturity of the Notes has been accelerated (whether by declaration or otherwise) and the Trustee has delivered a notice of acceleration to the Collateral Agent, no release of Collateral pursuant to the provisions of the Note Security Documents will be effective as against the Holders of Notes. (c) The release of Collateral from the terms of this Indenture and the Note Security Documents will not be deemed to impair the security under this Indenture in contravention of the provisions hereof if and to the extent the Collateral is released pursuant to the terms the Intercreditor Agreement or this Indenture and any Note Security Document. To the extent applicable, the Company will cause TIA Section 313(b), relating to reports, and TIA Section 314(d), relating to the release of property or securities or relating to the substitution therefor of any property or securities to be subjected to the Liens of the Note Security Documents, to be complied with. Any certificate or opinion required by TIA Section 314(d) may be made by an officer of the Company except in cases where TIA Section 314(d) requires that such certificate or opinion be made by an independent Person, which Person will be an independent engineer, appraiser or other expert selected by or reasonably satisfactory to the trustee. Notwithstanding anything to the contrary in this Article 10, the Company will not be required to comply with all or any portion of TIA Section 314(d) if it determines, in good faith based on advice of counsel, that under the terms of TIA Section 314(d) and/or any interpretation or guidance as to the meaning thereof of the SEC and its staff, including "no action" letters or exemptive orders, all or any portion of TIA Section 314(d) is inapplicable to one or a series of released Collateral. Section 10.04. Certificates of the Company. The Company will furnish to the Trustee and the Collateral Agent, prior to each proposed release of Collateral pursuant to the Note Security Documents, all documents required by TIA Section 314(d) to the extent applicable (as the same may be modified by any exemptive relief granted by the SEC). The Trustee may, to the extent permitted by Sections 7.01 and 7.02 hereof, accept as conclusive evidence of compliance with the foregoing provisions the appropriate statements contained in such documents and such Opinion of Counsel. Section 10.05. Certificates of the Trustee. In the event that the Company wishes to release the Collateral in accordance with the Note Security Documents and the Company has delivered the certificates and documents required by the Note Security Documents and Sections 10.03 and 10.04 hereof, the Trustee will determine whether it has received all documentation required by TIA Section 314(d) in connection with such release and, if at that time the Trustee is not itself also the Collateral Agent, based on such determination, will deliver a certificate to the Collateral Agent setting forth such determination. Section 10.06. Authorization of Actions to Be Taken by the Trustee Under the Note Security Documents. Subject to the provisions of the Intercreditor Agreement and Sections 7.01 and 7.02 hereof, the Trustee may, in its sole discretion and without the consent of the Holders of Notes, direct, on behalf of the Holders of Notes, the Collateral Agent to, take all actions it deems necessary or appropriate in order to: 96 (1) foreclose upon or otherwise enforce any or all of the Senior Secured Note Liens; (2) enforce any of the terms of the Note Security Documents; and (3) collect and receive any and all amounts payable in respect of the Obligations of the Company hereunder. Subject to the provisions of the Intercreditor Agreement, the Trustee will have power to institute and maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Senior Secured Note Priority Collateral or the Credit Facility Priority Collateral by any acts that may be unlawful or in violation of the Note Security Documents or this Indenture, and such suits and proceedings as the Trustee may deem expedient to preserve or protect its interests and the interests of the Holders of Notes in the Senior Secured Note Priority Collateral or the Credit Facility Priority Collateral (including power to institute and maintain suits or proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would impair the security interest hereunder or be prejudicial to the interests of the Holders of Notes or of the Trustee). Section 10.07. Authorization of Receipt of Funds by the Trustee Under the Pledge Agreement. Subject to the provisions of the Intercreditor Agreement, the Trustee is authorized to receive any funds for the benefit of the Holders of Notes distributed under the Note Security Documents, and to make further distributions of such funds to the Holders of Notes according to the provisions of this Indenture. Section 10.08. Termination of Security Interest. Upon the payment in full of the Notes and all Senior Secured Note Obligations that are outstanding, due and payable at the time the Notes are paid in full, upon Legal Defeasance or Covenant Defeasance or upon the consent of at least 66-2/3% in principal amount of the Notes then outstanding as provided in Section 9.02 hereof, the Trustee will, at the request of the Company, deliver a certificate to the Collateral Agent instructing the Collateral Agent to release the Liens pursuant to this Indenture and the Note Security Documents. Upon receipt of such instructions from the Trustee, the Collateral Agent shall, at the Company's expense, execute, deliver or acknowledge any necessary or proper instruments of termination, satisfaction or release to evidence the release of all such Liens. ARTICLE 11 NOTE GUARANTEES Section 11.01 Note Guarantee. (a) Subject to this Article 11, each of the Guarantors hereby, jointly and severally, unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Indenture, the Notes or the obligations of the Company hereunder or thereunder, that: (1) the principal of, premium and Liquidated Damages, if any, and interest on, the Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and 97 all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (2) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantors will be jointly and severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection. (b) The Guarantors hereby agree that their obligations hereunder are unconditional, irrespective of the validity, regularity or enforceability of the Notes or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor. Each Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenant that this Note Guarantee will not be discharged except by complete performance of the obligations contained in the Notes and this Indenture. (c) If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Guarantors, any amount paid by either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, will be reinstated in full force and effect. (d) Each Guarantor agrees that it will not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby. Each Guarantor further agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (1) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (2) in the event of any declaration of acceleration of such obligations as provided in Article 6 hereof, such obligations (whether or not due and payable) will forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee. The Guarantors will have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Note Guarantee. Section 11.02 Limitation on Guarantor Liability. Each Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of such Guarantor will be limited to the maximum amount that will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other 98 Guarantor under this Article 11, result in the obligations of such Guarantor under its Note Guarantee not constituting a fraudulent transfer or conveyance. Section 11.03 Execution and Delivery of the Note Guarantee. To evidence its Note Guarantee set forth in Section 11.01 hereof, each Guarantor hereby agrees that a notation of such Note Guarantee substantially in the form attached as Exhibit E hereto will be endorsed by an Officer of such Guarantor on each Note authenticated and delivered by the Trustee and that this Indenture will be executed on behalf of such Guarantor by one of its Officers. Each Guarantor hereby agrees that its Note Guarantee set forth in Section 11.01 hereof will remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Note Guarantee. If an Officer whose signature is on this Indenture or on the Note Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Note Guarantee is endorsed, the Note Guarantee will be valid nevertheless. The delivery of any Note by the Trustee, after the authentication thereof hereunder, will constitute due delivery of the Note Guarantee set forth in this Indenture on behalf of the Guarantors. In the event that the Company or any of its Domestic Restricted Subsidiaries creates or acquires any Domestic Restricted Subsidiary after the date of this Indenture, if required by Section 4.18 hereof, the Company will cause such Domestic Restricted Subsidiary to comply with the provisions of Section 4.18 hereof and this Article 11, to the extent applicable. Section 11.04 Guarantors May Consolidate, etc., on Certain Terms. Except as otherwise provided in Section 11.05 hereof, no Guarantor may sell or otherwise dispose of all or substantially all of its assets to, or consolidate with or merge or amalgamate with or into (whether or not such Guarantor is the surviving Person) another Person, other than the Company or another Guarantor, unless: (1) immediately after giving effect to such transaction, no Default or Event of Default exists; (2) subject to Section 11.05 hereof, if the Person acquiring the property in any such sale or disposition or the Person formed by or surviving any such consolidation, merger or amalgamation is a Restricted Subsidiary that is not already a Guarantor, such Person assumes all the obligations of that Guarantor under this Indenture, its Note Guarantee, all Note Security Documents delivered by that Guarantor and the Registration Rights Agreement, pursuant to a supplemental indenture and other documentation in form and substance reasonably satisfactory to the Trustee and the Capital Stock of the successor resultant Person or transferee Person is pledged to the Collateral Agent for the benefit of the Holders of the Senior Secured Note Obligations pursuant to the Note Security Documents; or In case of any such consolidation, merger, amalgamation, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the Note Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by the Guarantor, such successor Person will succeed to and be substituted for the Guarantor with the same 99 effect as if it had been named herein as a Guarantor. Such successor Person thereupon may cause to be signed any or all of the Note Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee. All the Note Guarantees so issued will in all respects have the same legal rank and benefit under this Indenture as the Note Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Note Guarantees had been issued at the date of the execution hereof. Except as set forth in Articles 4 and 5 hereof, and notwithstanding clauses (1) and (2) above, nothing contained in this Indenture or in any of the Notes will prevent any consolidation or merger of a Guarantor with or into the Company or another Guarantor, or will prevent any sale or conveyance of the property of a Guarantor as an entirety or substantially as an entirety to the Company or another Guarantor. Section 11.05 Releases. The Note Guarantee of a Guarantor will be released and the Guarantor relieved of any obligation under its Note Guarantee: (1) in connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by way of merger or consolidation) to a Person that is not (either immediately before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company, if the sale or other disposition is not in violation of Section 4.10 hereof; (2) in connection with any direct or indirect sale of all of the Capital Stock of a Guarantor to a Person that is not (either immediately before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company, if the sale is not in violation of Section 4.10 hereof; (3) with the written consent of the holders of at least 66-2/3% of the aggregate principal amount of Notes then outstanding; (4) upon the Legal Defeasance or Covenant Defeasance of the Notes in accordance with Article 8 hereof or upon the satisfaction and discharge of this Indenture in accordance with Article 12 hereof; (5) if the Company designates any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in accordance with Section 4.19 hereof; or (6) if the Guarantor is not a Domestic Restricted Subsidiary, when it ceases to be a guarantor or otherwise provide direct credit support for any other Indebtedness of the Company or any Guarantor. Under any of the circumstances described in clauses (1) through (6) above, the applicable Guarantor or Guarantors will be released from all obligations under the Security Documents, the security interests in such Guarantor's or Guarantors' assets created pursuant to the Security Documents will be released and, upon any of the circumstances described in clauses (1), (2) or (4) above, the Capital Stock of such Guarantor or Guarantors will be released from the security interests created pursuant to the Security Documents, and in each case all Holders of the Notes will be deemed to have consented to the foregoing releases. At the request of the Company, the Trustee will execute and deliver any documents, instructions or instruments giving effect to, and evidencing the consent of the Holders to, any such release. 100 Any Guarantor not released from its obligations under its Note Guarantee as provided in this Section 11.05 will remain liable for the full amount of principal of and interest and premium and Liquidated Damages, if any, on the Notes and for the other obligations of any Guarantor under this Indenture as provided in this Article 11. ARTICLE 12 SATISFACTION AND DISCHARGE Section 12.01 Satisfaction and Discharge. This Indenture will be discharged and will cease to be of further effect as to all Notes issued hereunder, when: (1) either: (a) all Notes that have been authenticated, except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has been deposited in trust and thereafter repaid to the Company, have been delivered to the trustee for cancellation; or (b) all Notes that have not been delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders, cash in U.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities, in amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on the Notes not delivered to the Trustee for cancellation for principal, premium and Liquidated Damages, if any, and accrued interest to the date of maturity or redemption; (2) no Default has occurred and is continuing on the date of the deposit or will occur as a result of the deposit and the deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or any Guarantor is a party or by which the Company or any Guarantor is bound; (3) the Company or any Guarantor has paid or caused to be paid all sums payable by it under this Indenture; and (4) the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of the Notes at maturity or the redemption date, as the case may be. In addition, the Company must deliver an Officers' Certificate and an Opinion of Counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been satisfied. Upon the satisfaction and discharge of this Indenture, all Collateral will be released from the Lien and security interest created by the Note Security Documents pursuant to Section 10.03 and all Guarantors will be released from their Note Guarantees pursuant to Section 11.05. Notwithstanding the satisfaction and discharge of this Indenture, if money has been deposited with the Trustee pursuant to subclause (b) of clause (1) of this Section 12.01, the provisions of Sections 12.02 and 8.06 hereof will survive. In addition, nothing in this Section 12.01 will be deemed to discharge 101 those provisions of Section 7.07 hereof, that, by their terms, survive the satisfaction and discharge of this Indenture. Section 12.02 Application of Trust Money. Subject to the provisions of Section 8.06 hereof, all money deposited with the Trustee pursuant to Section 12.01 hereof shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium and Liquidated Damages, if any) and interest for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law. If the Trustee or Paying Agent is unable to apply any money or Government Securities in accordance with Section 12.01 hereof by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company's and any Guarantor's obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 12.01 hereof; provided that if the Company has made any payment of principal of, premium or Liquidated Damages, if any, or interest on, any Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or Government Securities held by the Trustee or Paying Agent. ARTICLE 13 MISCELLANEOUS Section 13.01 Trust Indenture Act Controls. If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA Section 318(c), the imposed duties will control. Section 13.02 Notices. Any notice or communication by the Company, any Guarantor or the Trustee to the others is duly given if in writing and delivered in Person or by first class mail (registered or certified, return receipt requested), facsimile transmission or overnight air courier guaranteeing next day delivery, to the others' address: If to the Company and/or any Guarantor: Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Facsimile No.: (513) 487-5969 Attention: Hugh O'Donnell With a copy to: Cravath, Swaine & Moore LLP 825 Eighth Avenue New York, NY 10019 102 Fax No.: (212) 474-3700 Attention: Mark I. Greene, Esq. If to the Trustee: U.S. Bank National Association 425 Walnut Street Cincinnati, Ohio 45202 Fax: (513) 632-5511 Attention: Corporate Trust Office The Company, any Guarantor or the Trustee, by notice to the others, may designate additional or different addresses for subsequent notices or communications. All notices and communications (other than those sent to Holders) will be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if transmitted by facsimile; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. Any notice or communication to a Holder will be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next day delivery to its address shown on the register kept by the Registrar. Any notice or communication will also be so mailed to any Person described in TIA Section 313(c), to the extent required by the TIA. Failure to mail a notice or communication to a Holder or any defect in it will not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. If the Company mails a notice or communication to Holders, it will mail a copy to the Trustee and each Agent at the same time. Section 13.03 Communication by Holders of Notes with Other Holders of Notes. Holders may communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA Section 312(c). Section 13.04 Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee: (1) an Officers' Certificate in form and substance reasonably satisfactory to the Trustee (which must include the statements set forth in Section 13.05 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been satisfied; and (2) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which must include the statements set forth in Section 13.05 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been satisfied. 103 Section 13.05 Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA Section 314(a)(4)) must comply with the provisions of TIA Section 314(e) and must include: (1) a statement that the Person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been satisfied; and (4) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied. Section 13.06 Rules by Trustee and Agents. The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions. Section 13.07 No Personal Liability of Directors, Officers, Employees and Stockholders. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Company or any Guarantor, as such, will have any liability for any obligations of the Company or the Guarantors under the Notes, this Indenture, the Note Guarantees, the Intercreditor Agreement, the Security Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under the federal securities laws and its is the view of the SEC that such a waiver is against public policy. Section 13.08 Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. Section 13.09 No Adverse Interpretation of Other Agreements. This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. Section 13.10 Successors. 104 All agreements of the Company in this Indenture and the Notes will bind its successors. All agreements of the Trustee in this Indenture will bind its successors. All agreements of each Guarantor in this Indenture will bind its successors, except as otherwise provided in Section 11.05 hereof. Section 13.11 Severability. In case any provision in this Indenture, the Note Guarantees or in the Notes is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby. Section 13.12 Counterpart Originals. The parties may sign any number of copies of this Indenture. Each signed copy will be an original, but all of them together represent the same agreement. Section 13.13 Table of Contents, Headings, etc. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and will in no way modify or restrict any of the terms or provisions hereof. [Signatures on following page] 105 SIGNATURES Dated as of May 26, 2004 MILACRON ESCROW CORPORATION By: /s/ Ronald D. Brown --------------------------- Name: Ronald D. Brown Title: President U.S.BANK NATIONAL ASSOCIATION By: /s/ Karolina K. Dies --------------------------- Name: Karolina K. Dies Title: Trust Officer [Face of Note] THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT UNDER SECTION 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. YOU MAY CONTACT THE CHIEF FINANCIAL OFFICER OF THE COMPANY, AT 2090 FLORENCE AVENUE, CINCINNATI, OHIO, 45206, (513) 487-5000, WHO WILL PROVIDE YOU WITH ANY REQUIRED INFORMATION REGARDING THE ORIGINAL ISSUE DISCOUNT. CUSIP/CINS ____________ 11-1/2% Senior Secured Notes due 2011 No.______ $____________ MILACRON ESCROW CORPORATION promises to pay to [______________] or registered assigns, the principal sum of __________________________________________________________ DOLLARS on _____________, 2011. Interest Payment Dates: May 15 and November 15 Record Dates: May 1 and November 1 Dated: _______________, 200__ MILACRON ESCROW CORPORATION By:________________________ Name: Title: This is one of the Notes referred to in the within-mentioned Indenture: U.S. BANK NATIONAL ASSOCIATION, as Trustee By:___________________________ Authorized Signatory A1-1 [Back of Note] 11-1/2% Senior Secured Notes due 2011 [Insert the Global Note Legend, if applicable pursuant to the provisions of the Indenture] [Insert the Private Placement Legend, if applicable pursuant to the provisions of the Indenture] [Insert the Unit Legend, if applicable pursuant to the provisions of the Indenture] Capitalized terms used herein have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. (1) INTEREST. Milacron Escrow Corporation, a Delaware corporation (such corporation, and its successors and assigns under the Indenture referred to below, being called the "Company"), promises to pay interest on the principal amount of this Note at 11-1/2% per annum from ________________, 20__ until maturity and shall pay the Liquidated Damages, if any, payable pursuant to Section 6 of the Registration Rights Agreement referred to below. The Company will pay interest and Liquidated Damages, if any, semi-annually in arrears on November 15 and May 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each, an "Interest Payment Date"). Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be _____________, 20__. The Company will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the rate then in effect to the extent lawful; it will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and Liquidated Damages, if any, (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year of twelve 30-day months. (2) METHOD OF PAYMENT. The Company will pay interest on the Notes (except defaulted interest) and Liquidated Damages, if any, to the Persons who are registered Holders of Notes at the close of business on the May 1 or November 1 next preceding the Interest Payment Date, even if such Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium and Liquidated Damages, if any, and interest at the office or agency of the Company maintained for such purpose within or without the City of St. Paul, Minnesota, or, at the option of the Company, payment of interest and Liquidated Damages, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders; provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Liquidated Damages, if any, on, all Global Notes and all other Notes the Holders of which will have provided wire transfer instructions to the Company or the Paying Agent. Such payment will be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. A1-2 (3) PAYING AGENT AND REGISTRAR. Initially, U.S. 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 of its Subsidiaries may act in any such capacity. (4) INDENTURE AND SECURITY DOCUMENTS. The Company issued the Notes under an Indenture dated as of May 26, 2004 (the "Indenture") between the Company and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the TIA. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are secured obligations of the Company. The Notes are secured by a pledge of Collateral pursuant to the Security Documents referred to in the Indenture. The Company shall be entitled, subject to compliance with Section 4.09 of the Indenture, to issue Additional Notes pursuant to Section 2.14 of the Indenture. (5) OPTIONAL REDEMPTION. (a) At any time on or prior to May 15, 2007, the Company may at its option on any one or more occasions redeem up to 35% of the aggregate principal amount of Notes issued under the Indenture at a redemption price of 111.5% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the redemption date, with the net cash proceeds of one or more Qualified Equity Issuances; provided that: (1) at least 65% of the aggregate principal amount of Notes initially issued under the Indenture remains outstanding immediately after the occurrence of such redemption (excluding Notes held by the Company and its Subsidiaries); and (2) the redemption occurs within 90 days of the date of the closing of such Qualified Equity Issuance. (b) The Company may also at its option on any one or more occasions redeem all or part of the Notes upon not less than 30 nor more than 60 days prior notice, at a redemption price equal to 100% of the principal amount thereof plus the Applicable Premium as of the date of redemption. (6) MANDATORY REDEMPTION. Other than in connection with redemption pursuant to a Special Mandatory Redemption, the Company is not required to make mandatory redemption or sinking fund payments with respect to the Notes. (7) SPECIAL MANDATORY REDEMPTION. In accordance with the terms and conditions of the Escrow Agreement, and using the funds in the Escrow Account, the Company shall redeem on the Escrow Redemption Date all and not less than all of the Notes at the Escrow Redemption Price if the Officers' Certificate required by Section 3(b) of the Escrow Agreement to be delivered by July 29, 2004 (the "Conditions Precedent Date") (or if the Conditions Precedent Date has been extended pursuant to the terms of the Escrow Agreement, by August 31, 2004) has not been so delivered. Upon the release of the funds from the Escrow Account after delivery of the Officers' Certificate required by Section 3(b) of the Escrow Agreement, the foregoing provisions of this Section 7 shall be null and void. A1-3 (8) REPURCHASE AT THE OPTION OF HOLDER. (a) If there is a Change of Control, the Company will be required to make an offer (a "Change of Control Offer") to each Holder to repurchase all or any part (equal to $1,000 or an integral multiple thereof) of each Holder's Notes validly tendered in the Change of Control Offer at a purchase price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date (the "Change of Control Payment"). Within 30 days following any Change of Control, the Company will mail a notice to each Holder setting forth the procedures governing the Change of Control Offer as required by the Indenture. (b) If the Company or a Restricted Subsidiary of the Company consummates any Asset Sales, within five Business Days of each date on which the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company will commence an offer to all Holders of Notes (an "Asset Sale Offer") pursuant to Section 3.09 of the Indenture to purchase the maximum principal amount of Notes (including any Additional Notes) that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, in accordance with the procedures set forth in the Indenture. To the extent that the aggregate amount of Notes (including any Additional Notes) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company (or such Restricted Subsidiary) may use such deficiency for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis. Holders of Notes that are the subject of an offer to purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" attached to the Notes. (c) If the Company or a Restricted Subsidiary of the Company consummates any Sale of Senior Secured Note Priority Collateral, within five Business Days of each date on which the aggregate amount of Excess Collateral Proceeds exceeds $10.0 million, the Company will commence an offer to all Holders of Notes (a "Collateral Proceeds Offer") pursuant to Section 3.10 of the Indenture to purchase the maximum principal amount of Notes (including any Additional Notes) that may be purchased out of the Excess Collateral Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, in accordance with the procedures set forth in the Indenture. To the extent that the aggregate amount of Notes (including any Additional Notes) tendered pursuant to an Collateral Proceeds Offer is less than the Excess Collateral Proceeds, the Company (or such Restricted Subsidiary) may use such deficiency for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes tendered into such Collateral Proceeds Offer exceeds the amount of Excess Collateral Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis. Holders of Notes that are the subject of an offer to purchase will receive an Collateral Proceeds Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" attached to the Notes. (9) NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a A1-4 satisfaction or discharge of the Indenture. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the applicable redemption date, interest ceases to accrue on the Notes or portion thereof called for redemption. (10) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date. (11) PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes. (12) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Indenture or the Notes or the Note Guarantees may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes including Additional Notes, if any, voting as a single class, and any existing Default or Event or Default or compliance with any provision of the Indenture or the Notes or the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes including Additional Notes, if any, voting as a single class. Without the consent of any Holder of a Note, the Indenture or the Notes or the Note Guarantees may be amended or supplemented (1) to cure any ambiguity, defect or inconsistency or to make a modification of a formal, minor or technical nature or correct a manifest error; (2) to provide for uncertificated Notes in addition to or in place of Certificated Notes; (3) to provide for the assumption of the Company's or a Guarantor's obligations to Holders of the Notes in the case of a merger or consolidation or a sale of all or substantially all of the Company's assets; (4) to add to the covenants of the Company or any Guarantor for the benefit of the Holders of the Notes or surrender any right or power conferred upon the Company or any Guarantor; (5) to make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights under the Indenture of any such Holder; (6) to comply with any requirement of the SEC in connection with the qualification of the Indenture under the TIA; (7) to add any additional Guarantor or to release any Guarantor from its Note Guarantee, to evidence or provide for the acceptance of appointment of a successor trustee or to add any additional Events of Default, in each case, as provided in the Indenture; (8) to make, complete or confirm any grant of a security interest in any Collateral permitted or required by the Security Documents or the Indenture or any release of Collateral that becomes effective as set forth in the Security Documents or the Indenture; (9) to conform the text of the Indenture, the Note Guarantees, the Intercreditor Agreement, the other Security Documents or the Notes to any provision of the "Description of Senior Secured Notes" section of the Offering Circular dated May 12, 2004, to the extent that such provision in that "Description of Senior Secured Notes" was intended to be a verbatim recitation of a provision of the Indenture, the Note Guarantees, the Intercreditor Agreement, the other Security Documents or the Notes; (10) to comply with Sections 5.01 and 4.10 of the Indenture; (11) to reflect any waiver or termination of any right arising under the provisions of the Intercreditor Agreement that otherwise would be enforceable by any holder of a Credit Facility Lien, if such waiver or termination is set forth or provided in A1-5 the Indenture, any of the Security Documents or the agreement governing or giving rise to such Credit Facility Lien, provided that no such waiver or amendment pursuant to this clause (11) shall adversely affect the rights of Holders of the Notes; and (12) to release Collateral constituting Excluded Securities in accordance with the conditions set forth in the definition of Excluded Assets in the Indenture. (13) DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30 days in the payment when due of interest on, or Liquidated Damages, if any, with respect to the Notes; (ii) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the Notes, (iii) failure by the Company to comply with its obligations under Sections 4.10, 4.15, 4.21 or 5.01 of the Indenture; (iv) failure by the Company or any of its Restricted Subsidiaries for 30 days after written notice by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class to comply with the provisions of Sections 4.07 and 4.09 of the Indenture, (v) failure by the Company or any of its Restricted Subsidiaries for 60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class to comply with any of the other agreements in the Indenture, the Escrow Agreement, the Notes, or the Security Documents; (vi) default under certain other agreements relating to Indebtedness of the Company or any of its Restricted Subsidiaries which default is either (a) a Payment Default or (b) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of such Indebtedness aggregates at least $15.0 million; (vii) certain final judgments for the payment of money that remain undischarged for a period of 60 days and aggregate in excess of $15.0 million; (viii) the Escrow Agreement or any other Security Document or any Lien purported to be granted thereby on the Escrow Account or the cash therein, the Eurobond Escrow Agreement or any other security document or any Lien purposed to be granted thereby on the Eurobond Escrow Account or the cash therein, or any one or more other items of Collateral having an aggregate fair market value in excess of $15.0 million is held in any judicial proceeding to be unenforceable or invalid, in whole or in part, or ceases for any reason (other than pursuant to a release that is delivered or becomes effective as set forth in the indenture) to be fully enforceable and perfected; provided that if the holders of the Series B Notes and the common stock into which the Series A Notes were converted waive the requirement in the Note Purchase Agreement for the establishment of the Eurobond Escrow Account, then the failure to establish the Eurobond Escrow Account or execute the Eurobond Escrow Agreement (or the termination of the Eurobond Escrow Agreement and dissolution of the Eurobond Escrow Account) shall not be deemed an Event of Default; (ix) the Company or any Guarantor denies or disaffirms, in writing in any pleading in any court of competent jurisdiction, any obligation of the Company or any Guarantor set forth in or arising under any Security Document; and (x) except as permitted by the Indenture, any Note Guarantee is held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect and such default continues for 10 days after notice by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class or any Guarantor or any Person acting on its behalf denies or disaffirms its obligations under such Guarantor's Note Guarantee and (xi) certain events of bankruptcy or insolvency with respect to the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary. If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, all outstanding Notes will become due and payable immediately without further action or notice. Holders may A1-6 not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest or premium or Liquidated Damages, if any,) if it determines that withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may, on behalf of the Holders of all of the Notes, rescind an acceleration or waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest or premium or Liquidated Damages, if any, on, or the principal of, the Notes (other than non-payment of amounts that became due solely because of acceleration of the Notes). The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. (14) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. (15) NO RECOURSE AGAINST OTHERS. No director, officer, employee, incorporator or stockholder of the Company or any Guarantor, as such, will have any liability for any obligations of the Company or the Guarantors under the Notes, the indenture, the Note Guarantees, the Intercreditor Agreement, the Security Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under the federal securities laws and its is the view of the Commission that such a waiver is against public policy. (16) AUTHENTICATION. This Note will not be valid until authenticated by the manual signature of the Trustee or an authenticating agent. (17) ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). (18) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes will have all the rights set forth in the Registration Rights Agreement dated as of May 26, 2004, between the Company and the other parties named on the signature pages thereof or, in the case of Additional Notes, Holders of Restricted Global Notes and Restricted Definitive Notes will have the rights set forth in one or more registration rights agreements, if any, among the Company, the Guarantors and the other parties thereto, relating to rights given by the Company and the Guarantors to the purchasers of any Additional Notes (collectively, the "Registration Rights Agreement"). (19) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of redemption as a A1-7 convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed thereon. (20) GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THE INDENTURE, THIS NOTE AND THE NOTE GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. The Company will furnish to any Holder upon written request and without charge a copy of the Indenture and/or the Registration Rights Agreement. Requests may be made to: Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Facsimile No.: (513) 487-5969 Attention: Hugh O'Donnell A1-8 ASSIGNMENT FORM To assign this Note, fill in the form below: (I) or (we) assign and transfer this Note to: __________________________________ (Insert assignee's legal name) ________________________________________________________________________________ (Insert assignee's soc. sec. or tax I.D. no.) ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Print or type assignee's name, address and zip code) and irrevocably appoint_________________________________________________________ to transfer this Note on the books of the Company. The agent may substitute another to act for him. Date: _______________ Your Signature:________________________________________________ (Sign exactly as your name appears on the face of this Note) Signature Guarantee*: _________________________ * Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). A1-9 OPTION OF HOLDER TO ELECT PURCHASE If you want to elect to have this Note purchased by the Company pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box below: [ ]Section 4.10 [ ]Section 4.15 If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you elect to have purchased: $______________ Date: _______________ Your Signature: _______________________________________________ (Sign exactly as your name appears on the face of this Note) Tax Identification No.:________________________________________ Signature Guarantee*: _________________________ * Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). A1-10 SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE * The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:
Amount of decrease in Amount of increase in Principal Amount Principal Amount Principal Amount at maturity of this Global Signature of authorized at maturity of at maturity of Note following such decrease officer of Trustee or Date of Exchange this Global Note this Global Note (or increase) Custodian - ---------------- --------------------- --------------------- ---------------------------- -----------------------
* This schedule should be included only if the Note is issued in global form. A1-11 [Face of Regulation S Temporary Global Note] THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT UNDER SECTION 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. YOU MAY CONTACT THE CHIEF FINANCIAL OFFICER OF THE COMPANY, AT 2090 FLORENCE AVENUE, CINCINNATI, OHIO, 45206, (513) 487-5000, WHO WILL PROVIDE YOU WITH ANY REQUIRED INFORMATION REGARDING THE ORIGINAL ISSUE DISCOUNT. CUSIP/CINS __________ 11-1/2 % Senior Secured Notes due 2011 No. ___ $__________ MILACRON ESCROW CORPORATION promises to pay to CEDE & CO. or registered assigns, the principal sum of __________________________________________________________ DOLLARS on _____________, 2011. Interest Payment Dates: May 15 and November 15 Record Dates: May 1 and November 1 Dated: _______________, 200_ MILACRON ESCROW CORPORATION By:____________________________ Name: Title: This is one of the Notes referred to in the within-mentioned Indenture: U.S. BANK NATIONAL ASSOCIATION, as Trustee By:____________________________ Authorized Signatory A2-1 [Back of Regulation S Temporary Global Note] 11-1/2% Senior Secured Notes due 2011 THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON. THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF MILACRON ESCROW CORPORATION. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS NOTE (OR ITS PREDECESSOR ) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION A2-2 MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO ANY EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER (IF AVAILABLE), (IV) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. Capitalized terms used herein have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. (1) INTEREST. Milacron Escrow Corporation, a Delaware corporation (such corporation, and its successors and assigns under the Indenture referred to below, being called the "Company"), promises to pay interest on the principal amount of this Note at 11-1/2% per annum from ________________, 20__ until maturity and shall pay the Liquidated Damages, if any, payable pursuant to Section 6 of the Registration Rights Agreement referred to below. The Company will pay interest and Liquidated Damages, if any, semi-annually in arrears on November 15 and May 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each, an "Interest Payment Date"). Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be _____________, 20__. The Company will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the rate then in effect to the extent lawful; it will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and Liquidated Damages, if any, (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year of twelve 30-day months. Until this Regulation S Temporary Global Note is exchanged for one or more Regulation S Permanent Global Notes, the Holder hereof shall not be entitled to receive payments of interest hereon; until so exchanged in full, this Regulation S Temporary Global Note shall in all other respects be entitled to the same benefits as other Notes under the Indenture. (2) METHOD OF PAYMENT. The Company will pay interest on the Notes (except defaulted interest) and Liquidated Damages, if any, to the Persons who are registered Holders of Notes at the close of business on the May 1 or November 1 next preceding the Interest Payment Date, even if such Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium and Liquidated Damages, if any, and interest at the office or agency of the Company maintained for such purpose within or without the A2-3 City of St. Paul, Minnesota, or, at the option of the Company, payment of interest and Liquidated Damages, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders; provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Liquidated Damages, if any, on, all Global Notes and all other Notes the Holders of which will have provided wire transfer instructions to the Company or the Paying Agent. Such payment will be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. (3) PAYING AGENT AND REGISTRAR. Initially, U.S. 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 of its Subsidiaries may act in any such capacity. (4) INDENTURE AND SECURITY DOCUMENTS. The Company issued the Notes under an Indenture dated as of May 26, 2004 (the "Indenture") between the Company and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the TIA. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are secured obligations of the Company. The Notes are secured by a pledge of Collateral pursuant to the Security Documents referred to in the Indenture. The Company shall be entitled, subject to compliance with Section 4.09 of the Indenture, to issue Additional Notes pursuant to Section 2.14 of the Indenture. (5) OPTIONAL REDEMPTION. (a) At any time on or prior to May 15, 2007, the Company may at its option on any one or more occasions redeem up to 35% of the aggregate principal amount of Notes issued under the Indenture at a redemption price of 111.5% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the redemption date, with the net cash proceeds of one or more Qualified Equity Issuances; provided that: (1) at least 65% of the aggregate principal amount of Notes initially issued under the Indenture remains outstanding immediately after the occurrence of such redemption (excluding Notes held by the Company and its Subsidiaries); and (2) the redemption occurs within 90 days of the date of the closing of such Qualified Equity Issuance. (b) The Company may also at its option on any one or more occasions redeem all or part of the Notes upon not less than 30 nor more than 60 days prior notice, at a redemption price equal to 100% of the principal amount thereof plus the Applicable Premium as of the date of redemption. (6) MANDATORY REDEMPTION. Other than in connection with redemption pursuant to a Special Mandatory Redemption, the Company is not required to make mandatory redemption or sinking fund payments with respect to the Notes. (7) SPECIAL MANDATORY REDEMPTION. A2-4 In accordance with the terms and conditions of the Escrow Agreement, and using the funds in the Escrow Account, the Company shall redeem on the Escrow Redemption Date all and not less than all of the Notes at the Escrow Redemption Price if the Officers' Certificate required by Section 3(b) of the Escrow Agreement to be delivered by July 29, 2004 (the "Conditions Precedent Date") (or if the Conditions Precedent Date has been extended pursuant to the terms of the Escrow Agreement, by August 31, 2004) has not been so delivered. Upon the release of the funds from the Escrow Account after delivery of the Officers' Certificate required by Section 3(b) of the Escrow Agreement, the foregoing provisions of this Section 7 shall be null and void. (8) REPURCHASE AT THE OPTION OF HOLDER. (a) If there is a Change of Control, the Company will be required to make an offer (a "Change of Control Offer") to each Holder to repurchase all or any part (equal to $1,000 or an integral multiple thereof) of each Holder's Notes validly tendered in the Change of Control Offer at a purchase price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date (the "Change of Control Payment"). Within 30 days following any Change of Control, the Company will mail a notice to each Holder setting forth the procedures governing the Change of Control Offer as required by the Indenture. (b) If the Company or a Restricted Subsidiary of the Company consummates any Asset Sales, within five Business Days of each date on which the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company will commence an offer to all Holders of Notes (an "Asset Sale Offer") pursuant to Section 3.09 of the Indenture to purchase the maximum principal amount of Notes (including any Additional Notes) that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, in accordance with the procedures set forth in the Indenture. To the extent that the aggregate amount of Notes (including any Additional Notes) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company (or such Restricted Subsidiary) may use such deficiency for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis. Holders of Notes that are the subject of an offer to purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" attached to the Notes. (c) If the Company or a Restricted Subsidiary of the Company consummates any Sale of Senior Secured Note Priority Collateral, within five Business Days of each date on which the aggregate amount of Excess Collateral Proceeds exceeds $10.0 million, the Company will commence an offer to all Holders of Notes (a "Collateral Proceeds Offer") pursuant to Section 3.10 of the Indenture to purchase the maximum principal amount of Notes (including any Additional Notes) that may be purchased out of the Excess Collateral Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, in accordance with the procedures set forth in the Indenture. To the extent that the aggregate amount of Notes (including any Additional Notes) tendered pursuant to an Collateral Proceeds Offer is less than the Excess Collateral Proceeds, the Company (or such Restricted Subsidiary) may use such deficiency for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes tendered into such Collateral Proceeds Offer exceeds the amount of Excess Collateral A2-5 Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis. Holders of Notes that are the subject of an offer to purchase will receive an Collateral Proceeds Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" attached to the Notes. (9) NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction or discharge of the Indenture. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the applicable redemption date, interest ceases to accrue on the Notes or portion thereof called for redemption. (10) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date. This Regulation S Temporary Global Note is exchangeable in whole or in part for one or more Global Notes only (i) on or after the termination of the 40-day distribution compliance period (as defined in Regulation S) and (ii) upon presentation of certificates (accompanied by an Opinion of Counsel, if applicable) required by Article 2 of the Indenture. Upon exchange of this Regulation S Temporary Global Note for one or more Global Notes, the Trustee shall cancel this Regulation S Temporary Global Note. (11) PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes. (12) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Indenture or the Notes or the Note Guarantees may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes including Additional Notes, if any, voting as a single class, and any existing Default or Event or Default or compliance with any provision of the Indenture or the Notes or the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes including Additional Notes, if any, voting as a single class. Without the consent of any Holder of a Note, the Indenture or the Notes or the Note Guarantees may be amended or supplemented (1) to cure any ambiguity, defect or inconsistency or to make a modification of a formal, minor or technical nature or correct a manifest error; (2) to provide for uncertificated Notes in addition to or in place of Certificated Notes; (3) to provide for the assumption of the Company's or a Guarantor's obligations to Holders of the Notes in the case of a merger or consolidation or a sale of all or substantially all of the Company's assets; (4) to add to the covenants of the Company or any Guarantor for the benefit of the Holders of the Notes or surrender any right or power conferred upon the Company or any Guarantor; (5) to make any change that would provide any additional rights or benefits to the Holders of the Notes or that A2-6 does not adversely affect the legal rights under the Indenture of any such Holder; (6) to comply with any requirement of the SEC in connection with the qualification of the Indenture under the TIA; (7) to add any additional Guarantor or to release any Guarantor from its Note Guarantee, to evidence or provide for the acceptance of appointment of a successor trustee or to add any additional Events of Default, in each case, as provided in the Indenture; (8) to make, complete or confirm any grant of a security interest in any Collateral permitted or required by the Security Documents or the Indenture or any release of Collateral that becomes effective as set forth in the Security Documents or the Indenture; (9) to conform the text of the Indenture, the Note Guarantees, the Intercreditor Agreement, the other Security Documents or the Notes to any provision of the "Description of Senior Secured Notes" section of the Offering Circular dated May 12, 2004, to the extent that such provision in that "Description of Senior Secured Notes" was intended to be a verbatim recitation of a provision of the Indenture, the Note Guarantees, the Intercreditor Agreement, the other Security Documents or the Notes; (10) to comply with Sections 5.01 and 4.10 of the Indenture; (11) to reflect any waiver or termination of any right arising under the provisions of the Intercreditor Agreement that otherwise would be enforceable by any holder of a Credit Facility Lien, if such waiver or termination is set forth or provided in the Indenture, any of the Security Documents or the agreement governing or giving rise to such Credit Facility Lien, provided that no such waiver or amendment pursuant to this clause (11) shall adversely affect the rights of Holders of the Notes; and (12) to release Collateral constituting Excluded Securities in accordance with the conditions set forth in the definition of Excluded Assets in the Indenture. (13) DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30 days in the payment when due of interest on, or Liquidated Damages, if any, with respect to the Notes; (ii) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the Notes, (iii) failure by the Company to comply with its obligations under Sections 4.10, 4.15, 4.21 or 5.01 of the Indenture; (iv) failure by the Company or any of its Restricted Subsidiaries for 30 days after written notice by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class to comply with the provisions of Sections 4.07 and 4.09 of the Indenture, (v) failure by the Company or any of its Restricted Subsidiaries for 60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class to comply with any of the other agreements in the Indenture, the Escrow Agreement, the Notes, or the Security Documents; (vi) default under certain other agreements relating to Indebtedness of the Company or any of its Restricted Subsidiaries which default is either (a) a Payment Default or (b) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of such Indebtedness aggregates at least $15.0 million; (vii) certain final judgments for the payment of money that remain undischarged for a period of 60 days and aggregate in excess of $15.0 million; (viii) the Escrow Agreement or any other Security Document or any Lien purported to be granted thereby on the Escrow Account or the cash therein, the Eurobond Escrow Agreement or any other security document or any Lien purposed to be granted thereby on the Eurobond Escrow Account or the cash therein, or any one or more other items of Collateral having an aggregate fair market value in excess of $15.0 million is held in any judicial proceeding to be unenforceable or invalid, in whole or in part, or ceases for any reason (other than pursuant to a release that is delivered or becomes effective as set forth in the indenture) to be fully enforceable and perfected; provided that if the holders of the Series B Notes and the common stock into which the Series A Notes were converted waive the requirement in the Note Purchase Agreement for the establishment of the Eurobond Escrow Account, then the failure to establish the Eurobond Escrow Account or execute the Eurobond Escrow Agreement (or the termination of the Eurobond Escrow Agreement and dissolution of the Eurobond Escrow A2-7 Account) shall not be deemed an Event of Default; (ix) the Company or any Guarantor denies or disaffirms, in writing in any pleading in any court of competent jurisdiction, any obligation of the Company or any Guarantor set forth in or arising under any Security Document; and (x) except as permitted by the Indenture, any Note Guarantee is held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect and such default continues for 10 days after notice by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding (including Additional Notes, if any) voting as a single class or any Guarantor or any Person acting on its behalf denies or disaffirms its obligations under such Guarantor's Note Guarantee and (xi) certain events of bankruptcy or insolvency with respect to the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary. If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, all outstanding Notes will become due and payable immediately without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest or premium or Liquidated Damages, if any,) if it determines that withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may, on behalf of the Holders of all of the Notes, rescind an acceleration or waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest or premium or Liquidated Damages, if any, on, or the principal of, the Notes (other than non-payment of amounts that became due solely because of acceleration of the Notes). The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. (14) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. (15) NO RECOURSE AGAINST OTHERS. No director, officer, employee, incorporator or stockholder of the Company or any Guarantor, as such, will have any liability for any obligations of the Company or the Guarantors under the Notes, the indenture, the Note Guarantees, the Intercreditor Agreement, the Security Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under the federal securities laws and its is the view of the Commission that such a waiver is against public policy. (16) AUTHENTICATION. This Note will not be valid until authenticated by the manual signature of the Trustee or an authenticating agent. (17) ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), A2-8 JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). (18) ADDITIONAL RIGHTS OF HOLDERS. In addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes will have all the rights set forth in the Registration Rights Agreement dated as of May 26, 2004, between the Company and the other parties named on the signature pages thereof or, in the case of Additional Notes, Holders of Restricted Global Notes and Restricted Definitive Notes will have the rights set forth in one or more registration rights agreements, if any, among the Company, the Guarantors and the other parties thereto, relating to rights given by the Company and the Guarantors to the purchasers of any Additional Notes (collectively, the "Registration Rights Agreement"). (19) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed thereon. (20) GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THE INDENTURE, THIS NOTE AND THE NOTE GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. The Company will furnish to any Holder upon written request and without charge a copy of the Indenture and/or the Registration Rights Agreement. Requests may be made to: Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Facsimile No.: (513) 487-5969 Attention: Hugh O'Donnell A2-9 ASSIGNMENT FORM To assign this Note, fill in the form below: (I) or (we) assign and transfer this Note to: __________________________________ (Insert assignee's legal name) ________________________________________________________________________________ (Insert assignee's soc. sec. or tax I.D. no.) ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Print or type assignee's name, address and zip code) and irrevocably appoint_________________________________________________________ to transfer this Note on the books of the Company. The agent may substitute another to act for him. Date: _______________ Your Signature:________________________________________________ (Sign exactly as your name appears on the face of this Note) Signature Guarantee*: _________________________ * Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). A2-10 OPTION OF HOLDER TO ELECT PURCHASE If you want to elect to have this Note purchased by the Company pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box below: [ ]Section 4.10 [ ]Section 4.15 If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you elect to have purchased: $_________________ Date: _______________ Your Signature:_________________________________________________ (Sign exactly as your name appears on the face of this Note) Tax Identification No.:_________________________________________ Signature Guarantee*: _________________________ * Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). A2-11 SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION S TEMPORARY GLOBAL NOTE The following exchanges of a part of this Regulation S Temporary Global Note for an interest in another Global Note, or exchanges of a part of another other Restricted Global Note for an interest in this Regulation S Temporary Global Note, have been made:
Amount of decrease in Amount of increase in Principal Amount Principal Amount Principal Amount at maturity of this Global Signature of authorized at maturity of at maturity of Note following such decrease officer of Trustee or Date of Exchange this Global Note this Global Note (or increase) Custodian - ---------------- --------------------- --------------------- ---------------------------- -----------------------
A2-12 EXHIBIT B FORM OF CERTIFICATE OF TRANSFER Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Attention: Hugh O'Donnell U.S. Bank National Association _________________ Attention: ____________________ Re: __% Senior Secured Notes due 2011 Reference is hereby made to the Indenture, dated as of May __, 2004 (the "Indenture"), between Milacron Escrow Corporation, as issuer (the "Company"), and U.S. Bank National Association, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. ___________________, (the "Transferor") owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $___________ in such Note[s] or interests (the "Transfer"), to ___________________________ (the "Transferee"), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: [CHECK ALL THAT APPLY] 1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE 144A GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Note is being transferred to a Person that the Transferor reasonably believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A, and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Restricted Definitive Note and in the Indenture and the Securities Act. 2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE REGULATION S TEMPORARY GLOBAL NOTE, THE REGULATION S PERMANENT GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO REGULATION S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a Person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act , (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, the transfer is not being B-1 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 Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Permanent Global Note, the Regulation S Temporary Global Note and/or the Restricted Definitive Note and in the Indenture and the Securities Act. 3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE IAI GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one): (a) [ ] such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; or (b) [ ] such Transfer is being effected to the Company or a subsidiary thereof; or (c) [ ] such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; or (d) [ ] such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144, Rule 903 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) if such Transfer is in respect of a principal amount of Notes at the time of transfer of less than $250,000, an Opinion of Counsel provided by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note and/or the Restricted Definitive Notes and in the Indenture and the Securities Act. 4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE. (a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement B-2 Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. ________________________________________ [Insert Name of Transferor] By:_____________________________________ Name: Title: Dated: _______________________ B-3 ANNEX A TO CERTIFICATE OF TRANSFER 1. The Transferor owns and proposes to transfer the following: [CHECK ONE OF (a) OR (b)] (a) [ ] a beneficial interest in the: (i) [ ] 144A Global Note (CUSIP _________), or (ii) [ ] Regulation S Global Note (CUSIP_________), or (iii) [ ] IAI Global Note (CUSIP _________); or (b) [ ] a Restricted Definitive Note. 2. After the Transfer the Transferee will hold: [CHECK ONE] (a) [ ] a beneficial interest in the: (i) [ ] 144A Global Note (CUSIP _________), or (ii) [ ] Regulation S Global Note (CUSIP _________), or (iii) [ ] IAI Global Note (CUSIP _________); or (iv) [ ] Unrestricted Global Note (CUSIP _________); or (b) [ ] a Restricted Definitive Note; or (c) [ ] an Unrestricted Definitive Note, in accordance with the terms of the Indenture. B-4 EXHIBIT C FORM OF CERTIFICATE OF EXCHANGE Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Attention: Hugh O'Donnell U.S. Bank National Association _________________ Attention: _________________ Re: __% Senior Secured Notes due 2011 (CUSIP ____________) Reference is hereby made to the Indenture, dated as of May __, 2004 (the "Indenture"), between Milacron Escrow Corporation, as issuer (the "Company"), and U.S. Bank National Association, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. __________________________, (the "Owner") owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $____________ in such Note[s] or interests (the "Exchange"). In connection with the Exchange, the Owner hereby certifies that: 1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL Note. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Notes and pursuant to and in accordance with the Securities Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the Owner's Exchange of a Restricted Definitive Note for C-1 a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner's own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act. (b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange of the Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE] [ ] 144A Global Note, [ ] Regulation S Global Note, [ ] IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. ________________________________________ [Insert Name of Transferor] By:_________________________________________ C-2 Name: Title: Dated: ______________________ C-3 EXHIBIT D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Attention: Hugh O'Donnell U.S. Bank National Association _________________ Attention: _________________ Re: __% Senior Secured Notes due 2011 Reference is hereby made to the Indenture, dated as of May __, 2004 (the "Indenture"), between Milacron Escrow Corporation, as issuer (the "Company"), and U.S. Bank National Association, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. In connection with our proposed purchase of $____________ aggregate principal amount of: (a) [ ] a beneficial interest in a Global Note, or (b) [ ] a Definitive Note, we confirm that: 1. We understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the Securities Act of 1933, as amended (the "Securities Act"). 2. We understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Notes or any interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to a "qualified institutional buyer" (as defined therein), (C) to an institutional "accredited investor" (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter substantially in the form of this letter and, if such transfer is in respect of a principal amount of Notes, at the time of transfer of less than $250,000, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such transfer is in compliance with the Securities Act, (D) outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or (F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any Person purchasing the Definitive Note or beneficial interest in a Global Note from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein. D-1 3. We understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Notes purchased by us will bear a legend to the foregoing effect. 4. We are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. 5. We are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional "accredited investor") as to each of which we exercise sole investment discretion. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. ________________________________________ [Insert Name of Accredited Investor] By:_____________________________________ Name: Title: Dated: _______________________ D-2 EXHIBIT E FORM OF NOTATION OF GUARANTEE For value received, each Guarantor (which term includes any successor Person under the Indenture) has, jointly and severally, unconditionally guaranteed, to the extent set forth in the Indenture and subject to the provisions in the Indenture dated as of May 26, 2004 (the "Indenture") between Milacron Escrow Corporation, (the "Company") and U.S. Bank National Association, as trustee (the "Trustee"), (a) the due and punctual payment of the principal of, premium and Liquidated Damages, if any, and interest on, the Notes (as defined in the Indenture), whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on overdue principal of and interest on the Notes, if any, if lawful, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms of the Indenture and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. The obligations of the Guarantors to the Holders of Notes and to the Trustee pursuant to the Note Guarantee and the Indenture are expressly set forth in Article 11 of the Indenture and reference is hereby made to the Indenture for the precise terms of the Note Guarantee. Each Holder of a Note, by accepting the same, (a) agrees to and shall be bound by such provisions and (b) appoints the Trustee attorney-in-fact of such Holder for such purpose. Capitalized terms used but not defined herein have the meanings given to them in the Indenture. [NAME OF GUARANTOR(S)] By: ____________________________________ Name: Title: E-1 EXHIBIT F FORM OF SUPPLEMENTAL INDENTURE TO BE DELIVERED BY SUBSEQUENT GUARANTORS SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of ________________, 200__, among __________________ (the "Guaranteeing Subsidiary"), a subsidiary of Milcaron Escrow Corporation (or its permitted successor), a Delaware corporation (the "Company"), the Company, the other Guarantors (as defined in the Indenture referred to herein) and U.S. Bank National Association, as trustee under the Indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the "Indenture"), dated as of May __, 2004 providing for the issuance of ___% Senior Secured Notes due 2011 (the "Notes"); WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Note Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Note Guarantee and in the Indenture including but not limited to Article 11 thereof. 3. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the Intercreditor Agreement the Security Documents, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 4. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. F-1 EXHIBIT F 5. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 6. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 7. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company. F-2 EXHIBIT F IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written. Dated: _______________, 20___ [GUARANTEEING SUBSIDIARY] By:_______________________________ Name: Title: MILACRON ESCROW CORPORATION By:_______________________________ Name: Title: [EXISTING GUARANTORS] By:_______________________________ Name: Title: U.S. BANK NATIONAL ASSOCIATION, as Trustee By:_______________________________ Authorized Signatory F-3 EX-4.2 46 y98028exv4w2.txt SUPPLEMENTAL INDENTURE EXHIBIT 4.2 SUPPLEMENTAL INDENTURE Supplemental Indenture (this "Supplemental Indenture"), dated as of June 10, 2004, among Milacron Inc., a Delaware corporation (the "Company"), the Company's subsidiaries listed on Schedule A hereto (the "Guaranteeing Subsidiaries") and U.S. Bank National Association, as trustee under the Indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, Milacron Escrow Corporation, a Delaware corporation (the "Issuer") has heretofore executed and delivered to the Trustee an indenture (the "Indenture"), dated as of May 26, 2004 providing for the issuance of 11 1/2% Senior Secured Notes due 2011 (the "Notes"); WHEREAS, concurrently herewith, the Issuer is being merged with and into the Company, with the Company as the surviving company (the "Escrow Merger"); WHEREAS, pursuant to the Escrow Agreement (as defined in the Indenture), the Company is required to execute and deliver this Supplemental Indenture concurrently with the Escrow Merger; WHEREAS, the substitution of the Company for the Issuer is subject to Section 5.02 of the Indenture; WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiaries shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiaries shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Note Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company, the Guaranteeing Subsidiaries and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiaries hereby agree to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Note Guarantee and in the Indenture including but not limited to Article 11 thereof. 1 3. AGREEMENT TO ASSUME. The Company hereby assumes all of the obligations of the Issuer under the Indenture and the Notes, pursuant to Section 5.02 of the Indenture, and, hereafter, shall be deemed the "Company" for all purposes under the Indenture and the Notes. 4. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Company or any of the Guaranteeing Subsidiaries, as such, shall have any liability for any obligations of the Issuer, the Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the Intercreditor Agreement, the Security Documents, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 6. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 7. EFFECT OF HEADINGS. The section headings herein are for convenience only and shall not affect the construction hereof. 8. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by each Guaranteeing Subsidiary and the Company. 2 IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written. MILACRON INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Vice President - Finance and Chief Financial Officer EACH GUARANTEEING SUBSIDIARY LISTED ON SCHEDULE B HERETO By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Treasurer EACH GUARANTEEING SUBSIDIARY LISTED ON SCHEDULE C HERETO By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title:Vice President EACH GUARANTEEING SUBSIDIARY LISTED ON SCHEDULE D HERETO By: /s/ Hugh C. O'Donnell --------------------- Name: Hugh C. O'Donnell Title: Secretary EACH GUARANTEEING SUBSIDIARY LISTED ON SCHEDULE E HERETO By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Assistant Treasurer D-M-E OF CANADA LIMITED By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Treasurer MILACRON INTERNATIONAL MARKETING COMPANY By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Treasurer and Assistant Secretary MILACRON CAPITAL HOLDINGS B.V. By: /s/ Gerard van Deventer ----------------------- Name: Gerard van Deventer Title: Managing Director U.S. BANK NATIONAL ASSOCIATION, as Trustee By: /s/ Karolina K. Dies -------------------- Authorized Signatory SCHEDULE A Milacron Capital Holdings B.V. Milacron Marketing Company Milacron International Marketing Company Northern Supply Company, Inc. Nickerson Machinery Chicago Inc. Pliers International, Inc. Milacron Resin Abrasives Inc. D-M-E Company D-M-E U.S.A. Inc. D-M-E of Canada Limited Progress Precision Inc. 450500 Ontario Limited 528650 Ontario Limited 2913607 Canada Limited D-M-E Manufacturing Inc. Uniloy Milacron Inc. Uniloy Milacron U.S.A. Inc. Milacron Industrial Products, Inc. Oak International, Inc. Cimcool Industrial Products Inc. Milacron Canada Inc. Milacron Plastics Technologies Group Inc. SCHEDULE B Milacron Marketing Company Northern Supply Company, Inc. Nickerson Machinery Chicago Inc. Pliers International, Inc. D-M-E U.S.A. Inc. D-M-E Manufacturing Inc. Uniloy Milacron Inc. Uniloy Milacron U.S.A. Inc. Milacron Industrial Products, Inc. Oak International, Inc. Cimcool Industrial Products Inc. Milacron Plastics Technologies Group Inc. Progress Precision Inc. SCHEDULE C Milacron Resin Abrasives Inc. D-M-E Company SCHEDULE D 450500 Ontario Limited Milacron Canada Inc. SCHEDULE E 528650 Ontario Limited 2913607 Canada Limited EX-4.4 47 y98028exv4w4.txt REGISTRATION RIGHTS AGREEMENT EXHIBIT 4.4 $225,000,000 MILACRON ESCROW CORPORATION 11 1/2% SENIOR SECURED NOTES DUE 2011 REGISTRATION RIGHTS AGREEMENT May 26, 2004 Credit Suisse First Boston LLC As Representative of the Several Purchasers, c/o Credit Suisse First Boston LLC Eleven Madison Avenue New York, New York 10010-3629 Ladies and Gentlemen: Milacron Escrow Corporation, a Delaware corporation (collectively, with Milacron, Inc. upon its execution of the Registration Rights Joinder (as defined below) the "Issuer"), proposes to issue and sell to the several purchasers named in Schedule A hereto (collectively, the "Purchasers"), upon the terms set forth in a purchase agreement of even date herewith (the "Purchase Agreement"), $225,000,000 aggregate principal amount of its 11 1/2% Senior Secured Notes due 2011 (the "Initial Securities") to become unconditionally guaranteed (the "Guaranties") by the guarantors listed on Schedule B hereto (each a "Guarantor" and, collectively, the "Guarantors"). The Initial Securities will be issued pursuant to an Indenture, dated as of May 26, 2004, (the "Indenture") between the Issuer and U.S. Bank National Association, as trustee (the "Trustee"). All of the proceeds from the issuance of the Initial Securities will be escrowed under the Pledge and Escrow Agreement, dated as of May 26, 2004, (the "Pledge and Escrow Agreement") among the Issuer, the Trustee and U.S. Bank National Association, as escrow agent (the "Escrow Agent"), beginning on the date of the Indenture and ending on the date on which such proceeds are released upon satisfaction of all conditions precedent to such release, as set forth in the Pledge and Escrow Agreement (the "Escrow Period"). Pursuant to the terms of an agreement and plan of merger to be entered into by Milacron Escrow Corporation and Milacron Inc., a Delaware corporation ("Milacron"), Milacron Escrow Corporation will merge with and into Milacron, with Milacron as the surviving corporation, upon expiration of the Escrow Period (the "Escrow Merger"). After the expiration of the Escrow Period, Milacron and each Guarantor shall join this Agreement by execution of the joinder attached hereto as Exhibit A (the "Registration Rights Joinder"). As an inducement to the Purchasers, the Issuer agrees with the Purchasers, for the benefit of the holders of the Initial Securities (including, without limitation, the Purchasers), the Exchange Securities (as defined below) and the Private Exchange Securities (as defined below) (collectively the "Holders"), as follows: 1. Registered Exchange Offer. The Issuer shall, at its own cost, prepare and, not later than 120 days after (or if the 120th day is not a business day, the first business day thereafter) the expiration of the Escrow Period, file with the Securities and Exchange Commission (the "Commission") a registration statement (the "Exchange Offer Registration Statement") on an appropriate form under the Securities Act of 1933, as amended (the "Securities Act"), with respect to a proposed offer (the "Registered Exchange Offer") to the Holders of Transfer Restricted Securities (as defined in Section 6 hereof), who are not prohibited by any law or policy of the Commission from participating in the Registered Exchange Offer, to issue and deliver to such Holders, in exchange for the Initial Securities, a like aggregate principal amount of debt securities (the "Exchange Securities") of the Issuer issued under the Indenture and identical in all material respects to the Initial Securities (except for the transfer restrictions relating to the Initial Securities and the provisions relating to the matters described in Section 6 hereof) that would be registered under the Securities Act. The Issuer shall use its reasonable best efforts to cause such Exchange Offer Registration Statement to become effective under the Securities Act within 180 days (or if the 180th day is not a business day, the first business day thereafter) after the expiration of the Escrow Period and shall keep the Exchange Offer Registration Statement effective for not less than 30 days (or longer, if required by applicable law) after the date notice of the Registered Exchange Offer is mailed to the Holders (such period being called the "Exchange Offer Registration Period"). If the Issuer effects the Registered Exchange Offer, the Issuer will be entitled to close the Registered Exchange Offer 30 days after the commencement thereof provided that the Issuer has accepted all the Initial Securities theretofore validly tendered in accordance with the terms of the Registered Exchange Offer. Following the declaration of the effectiveness of the Exchange Offer Registration Statement, the Issuer shall promptly commence the Registered Exchange Offer, it being the objective of such Registered Exchange Offer to enable each Holder of Transfer Restricted Securities (as defined in Section 6 hereof) electing to exchange the Initial Securities for Exchange Securities (assuming that such Holder is not an affiliate of the Issuer within the meaning of the Securities Act, acquires the Exchange Securities in the ordinary course of such Holder's business and has no arrangements with any person to participate in the distribution of the Exchange Securities and is not prohibited by any law or policy of the Commission from participating in the Registered Exchange Offer) to trade such Exchange Securities from and after their receipt without any limitations or restrictions under the Securities Act and without material restrictions under the securities laws of the several states of the United States. The Issuer acknowledges that, pursuant to current interpretations by the Commission's staff of Section 5 of the Securities Act, in the absence of an applicable exemption therefrom, (i) each Holder which is a broker-dealer electing to exchange Securities, acquired for its own account as a result of market making activities or other trading activities, for Exchange Securities (an "Exchanging Dealer"), is required to deliver a prospectus containing the information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in the "Exchange Offer Procedures" section and the "Purpose of the Exchange Offer" section, and (c) Annex C hereto in the "Plan of Distribution" section of such prospectus in connection with a sale of any such Exchange Securities received by such Exchanging Dealer pursuant to the Registered Exchange Offer and (ii) a Purchaser that elects to sell Exchange Securities acquired in exchange for Securities constituting any portion of an unsold allotment is required to deliver a prospectus containing the information required by Items 507 or 508 of Regulation S-K under the Securities Act, as applicable, in connection with such sale. The Issuer shall use its reasonable best efforts to keep the Exchange Offer Registration Statement effective and to amend and supplement the prospectus contained therein, in order to permit such prospectus to be lawfully delivered by all persons subject to the prospectus delivery requirements of the Securities Act for such period of time as such persons must comply with such requirements in order to resell the Exchange Securities; provided, however, that (i) in the case where such prospectus and any amendment or supplement thereto must be delivered by an Exchanging Dealer or a Purchaser, such period shall be the lesser of 180 days and the date on which all Exchanging Dealers and the Purchasers have sold all Exchange Securities held by them (unless such period is extended pursuant to Section 3(j) below) and (ii) the Issuer shall make such prospectus and any amendment or supplement thereto, available to any broker-dealer for use in connection with any resale of any Exchange Securities for a period of not less than 90 days after the consummation of the Registered Exchange Offer; provided, however, that during such period, the Issuer 2 may suspend the effectiveness of the Exchange Offer Registration Statement, for an aggregate period of not more than 45 consecutive days in any 90 day period, and not totaling more than 90 days in any one year, if there is a possible acquisition or business combination or other transaction, business development or event involving the Issuer or any of its subsidiaries that may require disclosure in the Exchange Offer Registration Statement and the Issuer determines in the exercise of its reasonable judgment that such disclosure is not in the best interests of the Issuer and its stockholders or obtaining any financial statements relating to an acquisition or business combination required to be included in the Exchange Offer Registration Statement would be impracticable. In the event that the Issuer suspends the effectiveness of the Exchange Offer Registration Statement as contemplated by the proviso to the foregoing sentence, the Issuer shall promptly notify any such Exchanging Dealer, Purchaser or broker-dealer of the suspension of the Exchange Offer Registration Statement's effectiveness, provided that such notice shall not require the Issuer to disclose the possible acquisition or business combination or other transaction, business development or event if the Issuer determines in good faith that such acquisition or business combination or other transaction, business development or event should remain confidential. Upon the abandonment, consummation or termination of the possible acquisition or business combination or other transaction, business development or event or the availability of the required financial statements with respect to a possible acquisition or business combination, the suspension of the use of the Exchange Offer Registration Statement shall cease and the Issuer shall promptly comply with Section 3(j) hereof and notify such Exchanging Dealer, Purchaser or broker-dealer that the use of the prospectus contained in the Exchange Offer Registration Statement, as amended or supplemented, as applicable, may resume. If, upon consummation of the Registered Exchange Offer, any Purchaser holds Initial Securities acquired by it as part of its initial distribution, the Issuer, simultaneously with the delivery of the Exchange Securities pursuant to the Registered Exchange Offer, shall issue and deliver to such Purchaser upon the written request of such Purchaser, in exchange (the "Private Exchange") for the Initial Securities held by such Purchaser, a like principal amount of debt securities of the Issuer issued under the Indenture and identical in all material respects (including the existence of restrictions on transfer under the Securities Act and the securities laws of the several states of the United States, but excluding provisions relating to the matters described in Section 6 hereof) to the Initial Securities (the "Private Exchange Securities"). The Initial Securities, the Exchange Securities and the Private Exchange Securities are herein collectively called the "Securities". In connection with the Registered Exchange Offer, the Issuer shall: (a) mail to each Holder a copy of the prospectus forming part of the Exchange Offer Registration Statement, together with an appropriate letter of transmittal and related documents; (b) keep the Registered Exchange Offer open for not less than 30 days (or longer, if required by applicable law) after the date notice thereof is mailed to the Holders; (c) utilize the services of a depositary for the Registered Exchange Offer with an address in the Borough of Manhattan, The City of New York, which may be the Trustee or an affiliate of the Trustee; (d) permit Holders to withdraw tendered Securities at any time prior to the close of business, New York time, on the last business day on which the Registered Exchange Offer shall remain open; and (e) otherwise comply in all material respects with all applicable laws. As soon as practicable after the close of the Registered Exchange Offer or the Private Exchange, as the case may be, the Issuer shall: 3 (x) accept for exchange all the Securities validly tendered and not withdrawn pursuant to the Registered Exchange Offer and the Private Exchange; (y) deliver to the Trustee for cancellation all the Initial Securities so accepted for exchange; and (z) cause the Trustee to authenticate and deliver promptly to each Holder of the Initial Securities, Exchange Securities or Private Exchange Securities, as the case may be, equal in principal amount to the Initial Securities of such Holder so accepted for exchange. The Indenture will provide that the Exchange Securities will not be subject to the transfer restrictions set forth in the Indenture and that all the Securities will vote and consent together on all matters as one class and that none of the Securities will have the right to vote or consent as a class separate from one another on any matter. Interest on each Exchange Security and Private Exchange Security issued pursuant to the Registered Exchange Offer and in the Private Exchange will accrue from the last interest payment date on which interest was paid on the Initial Securities surrendered in exchange therefor or, if no interest has been paid on the Initial Securities, from the date of original issue of the Initial Securities. Each Holder participating in the Registered Exchange Offer shall be required to represent to the Issuer that at the time of the consummation of the Registered Exchange Offer (i) any Exchange Securities received by such Holder will be acquired in the ordinary course of business, (ii) such Holder will have no arrangements or understanding with any person to participate in the distribution of the Securities or the Exchange Securities within the meaning of the Securities Act, (iii) such Holder is not an "affiliate," as defined in Rule 405 of the Securities Act, of the Issuer or if it is an affiliate, such Holder will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable, (iv) if such Holder is not a broker-dealer, that it is not engaged in, and does not intend to engage in, the distribution of the Exchange Securities and (v) if such Holder is a broker-dealer, that it will receive Exchange Securities for its own account in exchange for Initial Securities that were acquired as a result of market-making activities or other trading activities and that it will be required to acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities. Notwithstanding any other provisions hereof, the Issuer will ensure that (i) any Exchange Offer Registration Statement and any amendment thereto and any prospectus forming part thereof and any supplement thereto complies in all material respects with the Securities Act and the rules and regulations thereunder, (ii) any Exchange Offer Registration Statement and any amendment thereto does not, when it becomes effective, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (iii) any prospectus forming part of any Exchange Offer Registration Statement, and any supplement to such prospectus, does not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. 2. Shelf Registration. If: (i) the Issuer is not (a) required to file the Exchange Offer Registration Statement or (b) permitted to consummate the Registered Exchange Offer because the Registered Exchange Offer is not permitted by applicable law or Commission policy; or (ii) any holder of Transfer Restricted Securities (as defined in Section 6 hereof) notifies the Issuer prior to the 20th day following the consummation of the Registered Exchange Offer that: (a) it is prohibited by law or Commission policy from participating in the Registered Exchange Offer or (b) that it may not resell the Exchange Securities acquired by it in the Registered Exchange Offer to the public without delivering a prospectus and the 4 prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales; or (c) that it is a broker dealer and owns Initial Securities acquired directly from the Issuer or an affiliate of the Issuer, the Issuer shall take the following actions: (a) The Issuer shall, at its cost, use its reasonable best efforts to file a registration statement (the "Shelf Registration Statement" and, together with the Exchange Offer Registration Statement, a "Registration Statement") on an appropriate form under the Securities Act relating to the offer and sale of the Transfer Restricted Securities (as defined in Section 6 hereof) by the Holders thereof from time to time in accordance with the methods of distribution set forth in the Shelf Registration Statement and Rule 415 under the Securities Act (hereinafter, the "Shelf Registration") within 60 days (or if such 60th day is not a business day, the first business day thereafter) after so required or requested pursuant to this Section 2 and the Issuer shall use its reasonable best efforts to cause the Shelf Registration Statement to be declared effective within 120 days (or if such 120th day is not a business day, the first business day thereafter) after so required or requested by this Section 2 or such later dates on which the Exchange Offer Registration Statement would have been required to be filed or declared effective, as the case may be; provided, however, that no Holder (other than a Purchaser) shall be entitled to have the Securities held by it covered by such Shelf Registration Statement unless such Holder agrees in writing to be bound by all the provisions of this Agreement applicable to such Holder. (b) The Issuer shall use its reasonable best efforts to keep the Shelf Registration Statement continuously effective in order to permit the prospectus included therein to be lawfully delivered by the Holders of the relevant Securities, for a period of two years (or for such longer period if extended pursuant to Section 3(j) below) from the date of its effectiveness or such shorter period that will terminate when all the Securities covered by the Shelf Registration Statement (i) have been sold pursuant thereto or (ii) are no longer restricted securities (as defined in Rule 144 under the Securities Act, or any successor rule thereof); provided, however, that the Issuer shall in no event be obligated to keep such Shelf Registration Statement effective for a period of more than 180 days from the date the Shelf Registration Statement is declared effective by the Commission if the Shelf Registration Statement is required to be filed solely to permit resales by a broker-dealer that holds Securities acquired directly from the Issuer or one or more of its affiliates or such shorter period that will terminate when all such Securities cease to be Transfer Restricted Securities; provided further that, during such period, the Issuer may suspend the effectiveness of the Shelf Registration Statement, for an aggregate period of not more than 45 consecutive days in any 90 day period, and not totaling more than 90 days in any one year, if there is a possible acquisition or business combination or other transaction, business development or event involving the Issuer and its subsidiaries that may require disclosure in the Shelf Registration Statement and the Issuer determines in the exercise of its reasonable judgment that such disclosure is not in the best interests of the Issuer and its stockholders or obtaining any financial statements relating to an acquisition or business combination required to be included in the Shelf Registration Statement would be impracticable. In the event that the Issuer suspends the effectiveness of the Shelf Registration Statement as contemplated by the proviso to the foregoing sentence, the Issuer shall promptly notify the Holders of such suspension, provided that such notice shall not require the Issuer to disclose the possible acquisition or business combination or other transaction, business development or event if the Issuer determines in good faith that such acquisition or business combination or other transaction, business development or event should remain confidential. Upon the abandonment, consummation or termination of the possible acquisition or business combination or other transaction, business development or event or the availability of the required financial statements with respect to a possible acquisition or business combination, the suspension of the use of the Shelf Registration Statement shall cease and the Issuer shall promptly comply with Section 3(j) hereof and notify the Holders that disposition of Transfer Restricted Securities may resume. The Issuer shall be deemed not to have used its reasonable best efforts to keep the 5 Shelf Registration Statement effective during the requisite period if it voluntarily takes any action (other than a suspension contemplated by the final proviso to the first sentence of this Section 2(b)) that would result in Holders of Securities covered thereby not being able to offer and sell such Securities during that period, unless such action is required by applicable law. (c) Notwithstanding any other provisions of this Agreement to the contrary, the Issuer shall cause the Shelf Registration Statement and the related prospectus and any amendment or supplement thereto, as of the effective date of the Shelf Registration Statement, amendment or supplement, (i) to comply in all material respects with the applicable requirements of the Securities Act and the rules and regulations of the Commission and (ii) not to contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. 3. Registration Procedures. In connection with any Shelf Registration contemplated by Section 2 hereof and, to the extent applicable, any Registered Exchange Offer contemplated by Section 1 hereof, the following provisions shall apply: (a) The Issuer shall (i) furnish to each Purchaser, prior to the filing thereof with the Commission, a copy of the Registration Statement and each amendment thereof and each supplement, if any, to the prospectus included therein and, in the event that a Purchaser (with respect to any portion of an unsold allotment from the original offering) is participating in the Registered Exchange Offer or the Shelf Registration Statement, the Issuer shall use its reasonable best efforts to reflect in each such document, when so filed with the Commission, such comments as such Purchaser reasonably may propose; (ii) include the information set forth in Annex A hereto on the cover, in Annex B hereto in the "Exchange Offer Procedures" section and the "Purpose of the Exchange Offer" section and in Annex C hereto in the "Plan of Distribution" section of the prospectus forming a part of the Exchange Offer Registration Statement and include the information set forth in Annex D hereto in the Letter of Transmittal delivered pursuant to the Registered Exchange Offer; (iii) if requested by a Purchaser, include the information required by Items 507 or 508 of Regulation S-K under the Securities Act, as applicable, in the prospectus forming a part of the Exchange Offer Registration Statement; (iv) include within the prospectus contained in the Exchange Offer Registration Statement a section entitled "Plan of Distribution," reasonably acceptable to the Purchasers, which shall contain a summary statement of the positions taken or policies made by the staff of the Commission with respect to the potential "underwriter" status of any broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) of Exchange Securities received by such broker-dealer in the Registered Exchange Offer (a "Participating Broker-Dealer"), whether such positions or policies have been publicly disseminated by the staff of the Commission or such positions or policies, in the reasonable judgment of the Purchasers based upon advice of counsel (which may be in-house counsel), represent the prevailing views of the staff of the Commission; and (v) subject to clause (n) below, in the case of a Shelf Registration Statement, include the names of the Holders, who propose to sell Securities pursuant to the Shelf Registration Statement, as selling securityholders. (b) The Issuer shall give written notice to the Purchasers, the Holders of the Securities and any Participating Broker-Dealer from whom the Issuer has received prior written notice that it will be a Participating Broker-Dealer in the Registered Exchange Offer (which notice pursuant to clauses (ii)-(v) hereof shall be accompanied by an instruction to suspend the use of the prospectus until the requisite changes have been made): 6 (i) when the Registration Statement or any amendment thereto has been filed with the Commission and when the Registration Statement or any post-effective amendment thereto has become effective; (ii) of any request by the Commission for amendments or supplements to the Registration Statement or the prospectus included therein or for additional information; (iii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings for that purpose; (iv) of the receipt by the Issuer or its legal counsel of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and (v) of the happening of any event that requires the Issuer to make changes in the Registration Statement or the prospectus in order that the Registration Statement or the prospectus do not contain an untrue statement of a material fact nor omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of the prospectus, in light of the circumstances under which they were made) not misleading. (c) The Issuer shall make every reasonable effort to obtain the withdrawal at the earliest possible time, of any order suspending the effectiveness of the Registration Statement. (d) The Issuer shall furnish to each Holder of Securities included within the coverage of the Shelf Registration, without charge, at least one copy of the Shelf Registration Statement and any post-effective amendment thereto, including financial statements and schedules, and, if the Holder so requests in writing, all exhibits thereto (including those, if any, incorporated by reference). (e) The Issuer shall deliver to each Exchanging Dealer and each Purchaser, and to any other Holder who so requests, without charge, at least one copy of the Exchange Offer Registration Statement and any post-effective amendment thereto, including financial statements and schedules, and, if any Purchaser or any such Holder requests, all exhibits thereto (including those incorporated by reference). (f) The Issuer shall, during the effectiveness of the Shelf Registration Statement, deliver to each Holder of Securities included within the coverage of the Shelf Registration, without charge, as many copies of the prospectus (including each preliminary prospectus) included in the Shelf Registration Statement and any amendment or supplement thereto as such person may reasonably request. The Issuer consents, subject to the provisions of this Agreement, to the use of the prospectus or any amendment or supplement thereto by each of the selling Holders of the Securities in connection with the offering and sale of the Securities covered by the prospectus, or any amendment or supplement thereto, included in the Shelf Registration Statement. (g) The Issuer shall deliver to each Purchaser, any Exchanging Dealer, any Participating Broker-Dealer and such other persons required to deliver a prospectus following the Registered Exchange Offer, without charge, as many copies of the final prospectus included in the Exchange Offer Registration Statement and any amendment or supplement thereto as such persons may reasonably request. The Issuer consents, subject to the provisions of this Agreement, to the use of the prospectus or any amendment or supplement thereto by any Purchaser, if necessary, any 7 Participating Broker-Dealer and such other persons required to deliver a prospectus following the Registered Exchange Offer in connection with the offering and sale of the Exchange Securities covered by the prospectus, or any amendment or supplement thereto, included in such Exchange Offer Registration Statement. (h) Prior to any public offering of the Securities, pursuant to any Registration Statement, the Issuer shall register or qualify or cooperate with the Holders of the Securities included therein and their respective counsel in connection with the registration or qualification of the Securities for offer and sale under the securities or "blue sky" laws of such states of the United States as any Holder of the Securities reasonably requests in writing; provided, however, that the Issuer shall not be required to (i) qualify generally to do business in any jurisdiction where it is not then so qualified or (ii) take any action which would subject it to general service of process or to taxation in any jurisdiction where it is not then so subject. (i) The Issuer shall cooperate with the Holders of the Securities to facilitate the timely preparation and delivery of certificates representing the Securities to be sold pursuant to any Registration Statement free of any restrictive legends and in such denominations and registered in such names as the Holders may request a reasonable period of time prior to sales of the Securities pursuant to such Registration Statement. (j) Upon the occurrence of any event contemplated by paragraphs (ii) through (v) of Section 3(b) above during the period for which the Issuer is required to maintain an effective Registration Statement, the Issuer shall promptly prepare and file a post-effective amendment to the Registration Statement or a supplement to the related prospectus and any other required document so that, as thereafter delivered to Holders of the Securities or purchasers of Securities, the prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Issuer notifies the Purchasers, the Holders of the Securities and any known Participating Broker-Dealer in accordance with paragraphs (ii) through (v) of Section 3(b) above to suspend the use of the prospectus until the requisite changes to the prospectus have been made, then the Purchasers, the Holders of the Securities and any such Participating Broker-Dealers shall suspend use of such prospectus, and the period of effectiveness of the Shelf Registration Statement provided for in Section 2(b) above and the Exchange Offer Registration Statement provided for in Section 1 above shall each be extended by the number of days from and including the date of the giving of such notice to and including the date when the Purchasers, the Holders of the Securities and any known Participating Broker-Dealer shall have received such amended or supplemented prospectus pursuant to this Section 3(j). (k) Not later than the effective date of the applicable Registration Statement, the Issuer will provide a CUSIP number for the Initial Securities, the Exchange Securities or the Private Exchange Securities, as the case may be, and provide the applicable trustee with printed certificates for the Initial Securities, the Exchange Securities or the Private Exchange Securities, as the case may be, in a form eligible for deposit with The Depository Trust Issuer. (l) The Issuer will comply in all material respects with all rules and regulations of the Commission to the extent and so long as they are applicable to the Registered Exchange Offer or the Shelf Registration and will make generally available to its security holders copies of such reports which it is required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act. (m) The Issuer shall cause the Indenture to be qualified under the Trust Indenture Act of 1939, as amended, in a timely manner and containing such changes, if any, as shall be necessary 8 for such qualification. In the event that such qualification would require the appointment of a new trustee under the Indenture, the Issuer shall appoint a new trustee thereunder pursuant to the applicable provisions of the Indenture. (n) The Issuer may require each Holder of Securities to be sold pursuant to the Shelf Registration Statement to furnish to the Issuer such information regarding the Holder and the distribution of the Securities as the Issuer may from time to time reasonably require for inclusion in the Shelf Registration Statement, and the Issuer may exclude from such registration the Securities of any Holder that unreasonably fails to furnish such information within a reasonable time after receiving such request. (o) The Issuer shall enter into such customary agreements (including, if requested, an underwriting agreement in customary form) and take all such other action, if any, as any Holder of the Securities shall reasonably request in order to facilitate the disposition of the Securities pursuant to any Shelf Registration. (p) In the case of any Shelf Registration, the Issuer shall (i) make reasonably available for inspection by the Holders of the Securities, any underwriter participating in any disposition pursuant to the Shelf Registration Statement and any attorney, accountant or other agent retained by the Holders of the Securities or any such underwriter all reasonably relevant financial and other records, pertinent corporate documents and properties of the Issuer and (ii) cause the Issuer's officers, directors, employees, accountants and auditors to supply all reasonably relevant information reasonably requested by the Holders of the Securities or any such underwriter, attorney, accountant or agent in connection with the Shelf Registration Statement, in each case, as shall be reasonably necessary to enable such persons, to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act; provided, however, that the foregoing inspection and information gathering shall be coordinated on behalf of the Purchasers by you and on behalf of the other parties, by one counsel designated by and on behalf of such other parties as described in Section 4 hereof. (q) In the case of any Shelf Registration, the Issuer, if reasonably requested by any Holder of Securities covered thereby based on advice of counsel, shall cause (i) its counsel to deliver an opinion and updates thereof relating to the Securities in customary form addressed to such Holders and the managing underwriters, if any, thereof and dated, in the case of the initial opinion, the effective date of such Shelf Registration Statement (it being agreed that the matters to be covered by such opinion shall include, without limitation, the due incorporation and good standing of the Issuer and its subsidiaries; the qualification of the Issuer and its subsidiaries to transact business as foreign corporations; the due authorization, execution and delivery of the relevant agreement of the type referred to in Section 3(o) hereof; the due authorization, execution, authentication and issuance, and the validity and enforceability, of the applicable Securities; the absence of material legal or governmental proceedings involving the Issuer and its subsidiaries; the absence of governmental approvals required to be obtained in connection with the Shelf Registration Statement, the offering and sale of the applicable Securities, or any agreement of the type referred to in Section 3(o) hereof; the compliance as to form of such Shelf Registration Statement and any documents incorporated by reference therein and of the Indenture with the requirements of the Securities Act and the Trust Indenture Act, respectively; and, as of the date of the opinion and as of the effective date of the Shelf Registration Statement or most recent post-effective amendment thereto, as the case may be, the absence from such Shelf Registration Statement and the prospectus included therein, as then amended or supplemented, and from any documents incorporated by reference therein of an untrue statement of a material fact or the omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading (in the case of any such documents, in the light of the 9 circumstances existing at the time that such documents were filed with the Commission under the Exchange Act); (ii) its officers to execute and deliver all customary documents and certificates and updates thereof requested by any underwriters of the applicable Securities and (iii) its independent public accountants and the independent public accountants with respect to any other entity for which financial information is provided in the Shelf Registration Statement to provide to the selling Holders of the applicable Securities and any underwriter therefor a comfort letter in customary form and covering matters of the type customarily covered in comfort letters in connection with primary underwritten offerings, subject to receipt of appropriate documentation as contemplated, and only if permitted, by Statement of Auditing Standards No. 72. (r) In the case of the Registered Exchange Offer, if reasonably requested by any Purchaser or any known Participating Broker-Dealer based on the advice of counsel, the Issuer shall cause (i) its counsel to deliver to such Purchaser or such Participating Broker-Dealer a signed opinion in the form set forth in Section 6(c) of the Purchase Agreement with such changes as are customary in connection with the preparation of a Registration Statement and (ii) its independent public accountants and the independent public accountants with respect to any other entity for which financial information is provided in the Registration Statement to deliver to such Purchaser or such Participating Broker-Dealer a comfort letter, in customary form, meeting the requirements as to the substance thereof as set forth in Section 6(a) of the Purchase Agreement, with appropriate date changes. (s) If a Registered Exchange Offer or a Private Exchange is to be consummated, upon delivery of the Initial Securities by Holders to the Issuer (or to such other Person as directed by the Issuer) in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be, the Issuer shall mark, or caused to be marked, on the Initial Securities so exchanged that such Initial Securities are being canceled in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be; in no event shall the Initial Securities be marked as paid or otherwise satisfied. (t) The Issuer will use its reasonable best efforts to (a) if the Initial Securities have been rated prior to the initial sale of such Initial Securities, confirm such ratings will apply to the Securities covered by a Registration Statement, or (b) if the Initial Securities were not previously rated, cause the Securities covered by a Registration Statement to be rated with the appropriate rating agencies, if so requested by Holders of a majority in aggregate principal amount of Securities covered by such Registration Statement, or by the managing underwriters, if any. (u) In the event that any broker-dealer registered under the Exchange Act shall underwrite any Securities or participate as a member of an underwriting syndicate or selling group or "assist in the distribution" (within the meaning of the Conduct Rules (the "Rules") of the National Association of Securities Dealers, Inc. ("NASD")) thereof, whether as a Holder of such Securities or as an underwriter, a placement or sales agent or a broker or dealer in respect thereof, or otherwise, the Issuer will assist such broker-dealer in complying with the requirements of such Rules, including, without limitation, by (i) if such Rules, including Rule 2720, shall so require, engaging a "qualified independent underwriter" (as defined in Rule 2720) to participate in the preparation of the Registration Statement relating to such Securities, to exercise usual standards of due diligence in respect thereto and, if any portion of the offering contemplated by such Registration Statement is an underwritten offering or is made through a placement or sales agent, to recommend the yield of such Securities, (ii) indemnifying any such qualified independent underwriter to the extent of the indemnification of underwriters provided in Section 5 hereof and (iii) providing such information to such broker-dealer as may be required in order for such broker-dealer to comply with the requirements of the Rules. 10 (v) The Issuer shall use its reasonable best efforts to take all other steps necessary to effect the registration of the Securities covered by a Registration Statement contemplated hereby. 4. Registration Expenses. The Issuer shall bear all its own fees and expenses incurred in connection with the performance of its obligations under Sections 1 through 3 hereof, whether or not the Registered Exchange Offer or a Shelf Registration is filed or becomes effective, and, in the event of a Shelf Registration, shall bear or reimburse the Holders of the Securities covered thereby for the reasonable fees and disbursements of one firm of counsel designated by the Holders of a majority in principal amount of the Initial Securities covered thereby to act as counsel for the Holders of the Initial Securities in connection therewith. 5. Indemnification. (a) The Issuer agrees to indemnify and hold harmless each Holder of the Securities, any Participating Broker-Dealer and each person, if any, who controls such Holder or such Participating Broker-Dealer within the meaning of the Securities Act or the Exchange Act (each Holder, any Participating Broker-Dealer and such controlling persons are referred to collectively as the "Indemnified Parties") from and against any losses, claims, damages or liabilities, joint or several, or any actions in respect thereof (including, but not limited to, any losses, claims, damages, liabilities or actions relating to purchases and sales of the Securities) to which each Indemnified Party may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration, or arise out of, or are based upon, the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse, as incurred, the Indemnified Parties for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action in respect thereof; provided, however, that (i) the Issuer shall not be liable in any such case to the extent that such loss, claim, damage or liability arises out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration in reliance upon and in conformity with written information pertaining to such Holder and furnished to the Issuer by or on behalf of such Holder specifically for inclusion therein and (ii) with respect to any untrue statement or omission or alleged untrue statement or omission made in any preliminary prospectus relating to a Shelf Registration Statement, the indemnity agreement contained in this subsection (a) shall not inure to the benefit of any Holder or Participating Broker-Dealer from whom the person asserting any such losses, claims, damages or liabilities purchased the Securities concerned, to the extent that a prospectus relating to such Securities was required to be delivered by such Holder or Participating Broker-Dealer under the Securities Act in connection with such purchase and any such loss, claim, damage or liability of such Holder or Participating Broker-Dealer results from the fact that there was not sent or given to such person, at or prior to the written confirmation of the sale of such Securities to such person, a copy of the final prospectus if the Issuer had previously furnished copies thereof to such Holder or Participating Broker-Dealer; provided further, however, that this indemnity agreement will be in addition to any liability which the Issuer may otherwise have to such Indemnified Party. The Issuer shall also indemnify underwriters, their officers and directors and each person who controls such underwriters within the meaning of the Securities Act or the Exchange Act to the same extent as provided above with respect to the indemnification of the Holders of the Securities if requested by such Holders. (b) Each Holder of the Securities, severally and not jointly, will indemnify and hold harmless the Issuer and each person, if any, who controls the Issuer within the meaning of the Securities Act or the Exchange Act from and against any losses, claims, damages or liabilities or any actions in respect thereof, to which the Issuer or any such controlling person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration 11 Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration, or arise out of or are based upon the omission or alleged omission to state therein a material fact necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or omission or alleged untrue statement or omission was made in reliance upon and in conformity with written information pertaining to such Holder and furnished to the Issuer by or on behalf of such Holder specifically for inclusion therein; and, subject to the limitation set forth immediately preceding this clause, shall reimburse, as incurred, the Issuer for any legal or other expenses reasonably incurred by the Issuer or any such controlling person in connection with investigating or defending any loss, claim, damage, liability or action in respect thereof. This indemnity agreement will be in addition to any liability which such Holder may otherwise have to the Issuer or any of its controlling persons. (c) Promptly after receipt by an indemnified party under this Section 5 of notice of the commencement of any action or proceeding (including a governmental investigation), such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 5, notify the indemnifying party of the commencement thereof; but the failure to notify the indemnifying party shall not relieve the indemnifying party from any liability that it may have under subsection (a) or (b) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided further that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under subsection (a) or (b) above. In case any such action is brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof the indemnifying party will not be liable to such indemnified party under this Section 5 for any legal or other expenses, other than reasonable costs of investigation, subsequently incurred by such indemnified party in connection with the defense thereof. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement (i) includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action, and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party. (d) If the indemnification provided for in this Section 5 is unavailable or insufficient to hold harmless an indemnified party under subsections (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party on the other from the exchange of the Securities, pursuant to the Registered Exchange Offer, or (ii) if the allocation provided by the foregoing clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the indemnifying party or parties on the one hand and the indemnified party on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof) as well as any other relevant equitable considerations. The relative fault of the parties shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Issuer on the one hand or such Holder or such other indemnified party, as the case may be, on the other, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid by an 12 indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding any other provision of this Section 5(d), the Holders of the Securities shall not be required to contribute any amount in excess of the amount by which the net proceeds received by such Holders from the sale of the Securities pursuant to a Registration Statement exceeds the amount of damages which such Holders have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this paragraph (d), each person, if any, who controls such indemnified party within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as such indemnified party and each person, if any, who controls the Issuer within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as the Issuer. (e) The agreements contained in this Section 5 shall survive the sale of the Securities pursuant to a Registration Statement and shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation made by or on behalf of any indemnified party. 6. Additional Interest Under Certain Circumstances. (a) Additional interest (the "Additional Interest") with respect to the Initial Securities shall be assessed as follows if any of the following events occur (each such event in clauses (i) through (iii) below a "Registration Default": (i) If by the 120th day (or if the 120th day is not a business day, the first business day thereafter) after the expiration of the Escrow Period neither the Exchange Offer Registration Statement nor a Shelf Registration Statement has been filed with the Commission; (ii) If by the 180th day (or if the 180th day is not a business day, the first business day thereafter) after the expiration of the Escrow Period, neither the Registered Exchange Offer is consummated nor, if required in lieu thereof, the Shelf Registration Statement is declared effective by the Commission; or (iii) If after either the Exchange Offer Registration Statement or the Shelf Registration Statement is declared effective (A) such Registration Statement thereafter ceases to be effective; or (B) such Registration Statement or the related prospectus ceases to be usable (except as permitted in paragraph (b)) in connection with resales of Transfer Restricted Securities during the periods specified herein because either (1) any event occurs as a result of which the related prospectus forming part of such Registration Statement would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made not misleading, or (2) it shall be necessary to amend such Registration Statement or supplement the related prospectus, to comply with the Securities Act or the Exchange Act or the respective rules thereunder. Additional Interest shall be paid by the Issuer to each Holder of the Initial Securities, with respect to the first 90-day period immediately following the occurrence of the first Registration Default in an amount equal to 50 basis points per annum of the principal amount of Securities held by such Holder. The amount of the Additional Interest will increase by an additional 50 basis points per annum of the principal amount of Securities with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum amount of Additional Interest for all Registration Defaults of 100 basis points per annum of the principal amount of Securities. Following the cure of all Registration Defaults, the accrual of Additional Interest will cease. 13 (b) A Registration Default referred to in Section 6(a)(iii)(B) hereof shall be deemed not to have occurred and be continuing in relation to a Shelf Registration Statement or the related prospectus if (i) such Registration Default has occurred solely as a result of (x) the filing of a post-effective amendment to such Shelf Registration Statement to incorporate annual audited financial information with respect to the Issuer where such post-effective amendment is not yet effective and needs to be declared effective to permit Holders to use the related prospectus or (y) other material events, with respect to the Issuer that would need to be described in such Shelf Registration Statement or the related prospectus or any suspension of the effectiveness of a Registration Statement contemplated by the final proviso to the sixth paragraph of Section 1 or the final proviso to the first sentence of Section 2(b) and (ii) in the case of clause (y), the Issuer is proceeding promptly and in good faith to amend or supplement such Registration Statement and related prospectus to describe such events; provided, however, that in any case if such Registration Default occurs for a continuous period in excess of 90 days, Additional Interest shall be payable in accordance with the above paragraph from the day such Registration Default occurs until such Registration Default is cured. (c) Any amounts of Additional Interest due pursuant to clause (i), (ii) or (iii) of Section 6(a) above will be payable in cash on the regular interest payment dates with respect to the Initial Securities. The amount of Additional Interest will be determined by multiplying the applicable Additional Interest rate by the principal amount of the Initial Securities, multiplied by a fraction, the numerator of which is the number of days such Additional Interest rate was applicable during such period (determined on the basis of a 360-day year comprised of twelve 30-day months), and the denominator of which is 360. (d) "Transfer Restricted Securities" means each Security until (i) the date on which such Transfer Restricted Security has been exchanged by a person other than a broker-dealer for a freely transferable Exchange Security in the Registered Exchange Offer, (ii) following the exchange by a broker-dealer in the Registered Exchange Offer of an Initial Security for an Exchange Note, the date on which such Exchange Note is sold to a purchaser who receives from such broker-dealer on or prior to the date of such sale a copy of the prospectus contained in the Exchange Offer Registration Statement, (iii) the date on which such Initial Security has been effectively registered under the Securities Act and disposed of in accordance with the Shelf Registration Statement or (iv) the date on which such Initial Securities is distributed to the public pursuant to Rule 144 under the Securities Act or is saleable pursuant to Rule 144(k) under the Securities Act. 7. Rules 144 and 144A. The Issuer shall use its reasonable best efforts to file the reports required to be filed by it under the Securities Act and the Exchange Act in a timely manner and, if at any time the Issuer is not required to file such reports, it will, upon the reasonable request of any Holder of Initial Securities, make publicly available other information so long as necessary to permit sales of their securities pursuant to Rules 144 and 144A. The Issuer covenants that it will take such further action as any Holder of Initial Securities may reasonably request, all to the extent required from time to time to enable such Holder to sell Initial Securities without registration under the Securities Act within the limitation of the exemptions provided by Rules 144 and 144A (including the requirements of Rule 144A(d)(4)). The Issuer will provide a copy of this Agreement to prospective purchasers of Initial Securities identified to the Issuer by the Purchasers upon request. Upon the request of any Holder of Initial Securities, the Issuer shall deliver to such Holder a written statement as to whether it has complied with such requirements. Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to require the Issuer to register any of its securities pursuant to the Exchange Act. 8. Underwritten Registrations. If any of the Transfer Restricted Securities covered by any Shelf Registration are to be sold in an underwritten offering, the investment banker or investment bankers and manager or managers that will administer the offering ("Managing Underwriters") will be selected by the Holders of a majority in aggregate principal amount of such Transfer Restricted Securities to be included in such offering. 14 No person may participate in any underwritten registration hereunder unless such person (i) agrees to sell such person's Transfer Restricted Securities on the basis reasonably provided in any underwriting arrangements approved by the persons entitled hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements. 9. Miscellaneous. (a) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, except by the Issuer and the written consent of the Holders of a majority in principal amount of the Securities affected by such amendment, modification, supplement, waiver or consents. (b) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand delivery, first-class mail, facsimile transmission, or air courier which guarantees overnight delivery: (1) if to a Holder of the Securities, at the most current address given by such Holder to the Issuer. (2) if to the Purchasers; Credit Suisse First Boston LLC Eleven Madison Avenue New York, NY 10010-3629 Fax No.: (212) 325-8278 Attention: Transactions Advisory Group with a copy to: Latham & Watkins LLP 885 Third Avenue, Suite 1000 New York, NY 10022 Fax No.: (212) 751-4864 Attention: Gregory A. Ezring, Esq. (3) if to the Issuer, at its address as follows: Milacron Escrow Corporation 2090 Florence Avenue Cincinnati, Ohio 45206 Fax No.: (513) 487-5969 Attention: General Counsel with a copy to: Cravath, Swaine & Moore LLP 825 Eighth Avenue New York, NY 10019 Fax No.: (212) 474-3700 Attention: Mark I. Greene, Esq. 15 All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; three business days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged by recipient's facsimile machine operator, if sent by facsimile transmission; and on the day delivered, if sent by overnight air courier guaranteeing next day delivery. (c) No Inconsistent Agreements. The Issuer has not, as of the date hereof, entered into, nor shall it, on or after the date hereof, enter into, any agreement with respect to its securities that is inconsistent with the rights granted to the Holders herein or otherwise conflicts with the provisions hereof. (d) Successors and Assigns. This Agreement shall be binding upon the Issuer and its successors and assigns. (e) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. (f) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. (g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. (h) Severability. If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby. (i) Securities Held by the Issuer. Whenever the consent or approval of Holders of a specified percentage of principal amount of Securities is required hereunder, Securities held by the Issuer or its affiliates (other than subsequent Holders of Securities if such subsequent Holders are deemed to be affiliates solely by reason of their holdings of such Securities) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage. 16 If the foregoing is in accordance with your understanding of our agreement, please sign and return to Milacron Escrow Corporation a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the several Purchasers and Milacron Escrow Corporation in accordance with its terms. Very truly yours, MILACRON ESCROW CORPORATION By: /s/ Ronald D. Brown -------------------- Name: Ronald D. Brown Title: President The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written. CREDIT SUISSE FIRST BOSTON LLC Acting on behalf of themselves and as the Representative of the several Purchasers. By CREDIT SUISSE FIRST BOSTON LLC By: /s/ Douglas A. Cruikshank -------------------------- Name: Douglas A. Cruikshank Title: Managing Director EXHIBIT A REGISTRATION RIGHTS JOINDER OF MILACRON INC. AND THE GUARANTORS With respect to the Registration Rights Agreement, dated as of May 26, 2004, between Milacron Escrow Corporation and Credit Suisse First Boston LLC, as representative of the several Purchasers named therein (the "Registration Rights Agreement"), (i) Milacron Inc. hereby agrees to be bound by such Registration Rights Agreement in the capacity as "Issuer" and assumes all of the rights and obligations of Milacron Escrow Corporation thereunder and (ii) each of the undersigned under the heading "Guarantor" below agrees to be bound by such Registration Rights Agreement in the capacity as "Guarantor", in each case, as of the effective time of the Escrow Merger, on __________, 2004. Capitalized terms used but not defined in this Registration Rights Joinder shall have the meanings given to such terms in the Registration Rights Agreement. Very truly yours, MILACRON INC. By:_________________________________ Name: Title: Guarantors: [GUARANTORS] By:_________________________________ Name: Title: SCHEDULE A Purchasers Credit Suisse First Boston LLC.......................................... J.P. Morgan Securities Inc.............................................. Lazard Freres & Co. LLC.................................................

SCHEDULE B
Guarantors Jurisdiction - ---------- ------------ Milacron Capital Holdings B.V. The Netherlands Milacron Marketing Company Ohio Milacron International Marketing Company Delaware Northern Supply Company, Inc. Minnesota Nickerson Machinery Chicago, Inc. Illinois Pliers International, Inc. Delaware Milacron Resin Abrasives Inc. Delaware D-M-E Company Delaware D-M-E U.S.A. Inc. Michigan D-M-E of Canada Limited Ontario Progress Precision Inc. Ontario 450500 Ontario Limited Ontario 528650 Ontario Limited Ontario 2913607 Canada Limited Canada D-M-E Manufacturing Inc. Delaware Uniloy Milacron Inc. Delaware Uniloy Milacron U.S.A. Inc. Michigan Milacron Industrial Products, Inc. Michigan Oak International Inc. Michigan Cimcool Industrial Products Inc. Delaware Milacron Canada Inc. Ontario Milacron Plastics Technologies Group Inc. Delaware
ANNEX A Each broker-dealer that receives Exchange Securities for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities. The Letter of Transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities received in exchange for Initial Securities where such Initial Securities were acquired by such broker-dealer as a result of market-making activities or other trading activities. The Issuer has agreed that, for a period of 180 days after the Expiration Date (as defined herein), it will make this Prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution." ANNEX B Each broker-dealer that receives Exchange Securities for its own account in exchange for Securities, where such Initial Securities were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities. See "Plan of Distribution." ANNEX C PLAN OF DISTRIBUTION Each broker-dealer that receives Exchange Securities for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities. This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities received in exchange for Initial Securities where such Initial Securities were acquired as a result of market-making activities or other trading activities. The Issuer has agreed that, for a period of 180 days after the Expiration Date, it will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. In addition, until [_______], 2004, all dealers effecting transactions in the Exchange Securities may be required to deliver a prospectus. The Issuer will not receive any proceeds from any sale of Exchange Securities by broker-dealers. Exchange Securities received by broker-dealers for their own account pursuant to the Exchange Offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the Exchange Securities or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer or the purchasers of any such Exchange Securities. Any broker-dealer that resells Exchange Securities that were received by it for its own account pursuant to the Exchange Offer and any broker or dealer that participates in a distribution of such Exchange Securities may be deemed to be an "underwriter" within the meaning of the Securities Act and any profit on any such resale of Exchange Securities and any commission or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The Letter of Transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. For a period of 180 days after the Expiration Date the Issuer will promptly send additional copies of this Prospectus and any amendment or supplement to this Prospectus to any broker-dealer that requests such documents in the Letter of Transmittal. The Issuer has agreed to pay all expenses incident to the Exchange Offer other than commissions or concessions of any brokers or dealers and will indemnify the Holders of the Securities (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act. ANNEX D [ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO. Name: _____________________________________________ Address: ___________________________________________ ___________________________________________ If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in, and does not intend to engage in, a distribution of Exchange Securities. If the undersigned is a broker-dealer that will receive Exchange Securities for its own account in exchange for Initial Securities that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a prospectus in connection with any resale of such Exchange Securities; however, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. EX-4.5 48 y98028exv4w5.txt JOINDER TO REGISTRATION RIGHTS AGREEMENT EXHIBIT 4.5 REGISTRATION RIGHTS JOINDER OF MILACRON INC. AND THE GUARANTORS With respect to the Registration Rights Agreement, dated as of May 26, 2004, between Milacron Escrow Corporation and Credit Suisse First Boston LLC, as representative of the several Purchasers named therein (the "Registration Rights Agreement"), (i) Milacron Inc. hereby agrees to be bound by such Registration Rights Agreement in the capacity as "Issuer" and assumes all of the rights and obligations of Milacron Escrow Corporation thereunder and (ii) each of the undersigned under the heading "Guarantors" below agrees to be bound by such Registration Rights Agreement in the capacity as "Guarantor", in each case, as of the effective time of the Escrow Merger, on June 10, 2004. Capitalized terms used but not defined in this Registration Rights Joinder shall have the meanings given to such terms in the Registration Rights Agreement. [Signature Pages Follow] Very truly yours, MILACRON INC. By: /s/ R.P. Lienesch ----------------- Name: R.P. Lienesch Title: Vice President - Finance and Chief Financial Officer Guarantors: EACH GUARANTOR LISTED ON SCHEDULE A HERETO By: /s/ Robert P. Lienesch ----------------- Name: Robert P. Lienesch Title: Treasurer EACH GUARANTOR LISTED ON SCHEDULE B HERETO By: /s/ Robert P. Lienesch ----------------- Name: Robert P. Lienesch Title: Vice President EACH GUARANTOR LISTED ON SCHEDULE C HERETO By: /s/ Hugh C. O'Donnell --------------------- Name: Hugh C. O'Donnell Title: Secretary EACH GUARANTOR LISTED ON SCHEDULE D HERETO By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Assistant Treasurer D-M-E OF CANADA LIMITED By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Treasurer MILACRON INTERNATIONAL MARKETING COMPANY By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Treasurer and Assistant Secretary MILACRON CAPITAL HOLDINGS B.V. By: /s/ Gerard van Deventer ----------------------- Name: Gerard van Deventer Title: Managing Director Dated: June 10, 2004 SCHEDULE A Milacron Marketing Company Northern Supply Company, Inc. Nickerson Machinery Chicago Inc. Pliers International, Inc. D-M-E U.S.A. Inc. D-M-E Manufacturing Inc. Uniloy Milacron Inc. Uniloy Milacron U.S.A. Inc. Milacron Industrial Products, Inc. Oak International, Inc. Cimcool Industrial Products Inc. Milacron Plastics Technologies Group Inc. Progress Precision Inc. SCHEDULE B Milacron Resin Abrasives Inc. D-M-E Company SCHEDULE C 450500 Ontario Limited Milacron Canada Inc. SCHEDULE D 528650 Ontario Limited 2913607 Canada Limited EX-4.6 49 y98028exv4w6.txt SECURITY AGREEMENT EXHIBIT 4.6 SECURITY AGREEMENT SECURITY AGREEMENT, dated June 10, 2004, made by each of the Grantors referred to below, in favor of U.S. Bank National Association, in its capacity as Collateral Agent for the Trustee and the Holders (as such terms are defined below) pursuant to the Indenture referred to below (in such capacity, together with any permitted successors and assigns, the "Collateral Agent"). W I T N E S S E T H: WHEREAS, Milacron Inc., a Delaware corporation (the "Company"), each subsidiary of the Company listed as a "Guarantor" on the signature pages of the supplemental indenture dated the date hereof to the Indenture (each such subsidiary and each subsidiary of the Company that has executed and delivered a Guarantee pursuant to the Indenture, a "Guarantor" and collectively, the "Guarantors," and the Guarantors (other than Milacron Capital Holdings B.V. and any Canadian Restricted Subsidiary) together with the Company, each a "Grantor" and collectively, the "Grantors"), the Collateral Agent and U.S. Bank National Association, in its capacity as trustee (in such capacity, together with any permitted successors and assigns, the "Trustee") are parties to an indenture, dated as of May 26, 2004 (as amended, restated, supplemented or otherwise modified from time to time, being hereinafter referred to as the "Indenture"), with respect to the Company's 11-1/2% Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, the Company has issued the Notes to the Holders; WHEREAS, it is a condition to the release to the Company from the Escrow Account of the proceeds from the offering of the Notes that each Grantor shall execute and deliver this Agreement; WHEREAS, the Grantors are mutually dependent on each other in the conduct of their respective businesses as an integrated operation, with the credit needed from time to time by each Grantor often being provided through financing obtained by the other Grantors and the ability to obtain such financing being dependent on the successful operations of all of the Grantors as a whole; and WHEREAS, each Grantor has determined that the execution, delivery and performance of this Agreement directly benefits, and are in the best interest of, such Grantor; NOW, THEREFORE, in consideration of the premises and the agreements herein, the Grantors hereby jointly and severally agree with the Collateral Agent, for the benefit of the Trustee and Holders, as follows: SECTION 1. Definitions. (a) Reference is hereby made to the Indenture for a statement of the terms thereof. All terms used in this Agreement and the recitals hereto which are defined in the Indenture or in the Code and which are not otherwise defined herein shall have the same meanings herein as set forth therein; provided that terms used herein which are defined in the Code as in effect on the date hereof shall continue to have the same meaning notwithstanding any replacement or amendment of such statute except as the Collateral Agent may otherwise determine. (b) The following terms shall have the respective meanings provided for in the Code (as defined below): "Accounts," "Cash Proceeds," "Chattel Paper," "Commercial Tort Claim," "Commodity Account," "Commodity Contracts," "Deposit Account," "Documents," "Equipment," "Fixtures," "General Intangibles," "Goods," "Instruments," "Inventory," "Investment Property," "Letter-of-Credit Rights," "Noncash Proceeds," "Payment Intangibles," "Proceeds," "Promissory Notes," "Record," "Security Account," "Software," and "Supporting Obligations." (c) As used in this Agreement, the following terms shall have the respective meanings indicated below, such meanings to be applicable equally to both the singular and plural forms of such terms: "Code" means the New York UCC; provided that to the extent that the Code is used to define any term herein and such term is defined differently in differing Articles of the Code, the definition of such term contained in Article 9 shall govern. "Copyright Licenses" means all licenses, contracts or other agreements, whether written or oral, naming any Grantor as licensee or licensor and providing for the grant of any right to use or sell any works covered by any copyright (including, without limitation, all Copyright Licenses set forth in Schedule II hereto). "Copyrights" means all domestic and foreign copyrights, whether registered or not, including, without limitation, all copyright rights throughout the universe (whether now or hereafter arising) in any and all media (whether now or hereafter developed), in and to all original works of authorship fixed in any tangible medium of expression, acquired or used by any Grantor (including, without limitation, all copyrights described in Schedule II hereto), all applications for registration, registrations and recordings of ownership thereof (including, without limitation, applications, registrations and recordings of ownership in the United States Copyright Office or in any similar office or agency of the United States or any other country or any political subdivision thereof), and all extensions, restorations or renewals thereof. "Discharge of Senior Secured Note Obligations" means the payment in full of the Senior Secured Note Obligations that are outstanding and unpaid at the time the Notes are paid in full. "Excluded Assets" means: (i) any lease of premises used only as office space or to warehouse inventory; (ii) any lease, license, permit, franchise, power, authority or right if, to the extent that and for as long as (a) the grant of a security interest therein constitutes or would result in the abandonment, invalidation or unenforceability of such lease, license, permit, franchise, power, authority or right or the termination of, breach of or a default 2 under the lease, instrument or agreement by which such lease, license, permit, franchise, power, authority or right is governed and (b) such abandonment, invalidation, unenforceability, breach, termination or default is not rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the New York UCC (or any successor provision) or the Code of any other relevant jurisdiction or any other applicable law (including the United States bankruptcy code) or principles of equity; provided, however, that (1) such lease, license, permit, franchise, power, authority or right will be an Excluded Asset only to the extent and for as long as the conditions set forth in clauses (a) and (b) in this definition are and remain satisfied and to the extent such assets otherwise constitute Collateral, will cease to be an Excluded Asset, and will become subject to the Liens hereunder, immediately and automatically at such time as such conditions cease to exist, including by reason of any waiver or consent under the applicable instrument or agreement, and (2) the proceeds of any sale, lease or other disposition of any such lease, license, permit, franchise, power, authority or right that is or becomes an Excluded Asset shall not be an Excluded Asset and shall at all times be and remain subject to the Liens hereunder; (iii) assets or property (a) located outside the United States (other than assets or property of a Canadian Restricted Subsidiary located in Canada) or (b) of any Canadian Restricted Subsidiary other than those of the type described in clauses (1) through (4) of the definition of Credit Facility Priority Collateral; (iv) Deposit Accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of salaried employees; (v) Deposit Accounts held by Oak International, Inc., at Citizens Bank and Nickerson Machinery Chicago Inc. at Fleet National Bank; (vi) any real property acquired after the date of the Indenture with a fair market value of less than $750,000 in the case of a fee interest or with an annual rent of less than $100,000 in the case of a leasehold interest; (vii) Capital Stock of any Subsidiary of the Company or any Guarantor formed under the laws of a jurisdiction other than the United States or any State of the United States or the District of Columbia (a "Foreign Stock Subsidiary") in excess of 65% of the outstanding Capital Stock of such Foreign Stock Subsidiary; (viii) Capital Stock of any non-wholly owned Foreign Stock Subsidiary to the extent that a grant of a Lien therein would conflict with the terms of any organizational document of, agreement governing investments in, or the law of the jurisdiction of formation of, such Foreign Stock Subsidiary; (ix) Capital Stock of Milacron Plastics Machinery (Jiangyin) Co., LTD, D-M-E-(Hong Kong) Limited, Japan D-M-E Corporation, Ferromatix India Limited and any Immaterial Subsidiary; (x) real estate located at 3025 Disney Street, Cincinnati, Ohio 45209 and real estate located at 10501 High M52, Manchester, Michigan 48158; 3 (xi) assets or property of Milacron Capital Holdings, B.V.; and (xii) (a) other personal property (other than Deposit Accounts, Letter of Credit Rights, Intellectual Property and Proceeds of Collateral) in which a security interest cannot be perfected by the filing of a financing statement under the Uniform Commercial Code or Personal Property Security Act or similar Canadian legislation and (b) without duplication, motor vehicles, that have, in the aggregate for all such property and motor vehicles, a fair market value (as determined in good faith by the Company) not exceeding $1,000,000. In addition, any Collateral consisting of any Capital Stock or other securities of any Subsidiary of the Company shall be limited at any time to that portion of such Capital Stock or other securities which value (defined as the principal amount, par value, book value as carried by the Company or market value, whichever is greatest), when considered in the aggregate with all other Capital Stock or other securities of such Subsidiary subject to a security interest hereunder, does not exceed 19.99% of the principal amount of the then outstanding Notes issued, and the portion of any such Capital Stock or other securities of such Subsidiary in excess of such percentage will be deemed Excluded Assets; provided, however, in the event that Rule 3-16 of Regulation S-X promulgated by the SEC is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation or any other law, rule or regulation is adopted, which would require) the filing with the SEC (or any other governmental agency) of separate financial statements of any Subsidiary of the Company due to such Subsidiary's Capital Stock or other securities securing the Notes, then the Capital Stock or other securities of such Subsidiary (the "Excluded Securities") shall automatically be deemed to be Excluded Assets, but only for so long as and to the extent necessary to not be subject to such requirement; provided, further, however, that in such event, this Agreement may be amended or modified, without the consent of any Holder of Notes, to the extent necessary to release the security interests in the Excluded Securities that are deemed to constitute Excluded Assets. "Excluded Accounts" means: (i) Deposit Accounts for which the Collateral Agent is the depositary, (ii) Deposit Accounts specially and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of a Grantor's salaried employees and (iii) Deposit Accounts held by (a) Oak International, Inc. at Citizens Bank and (b) Nickerson Machinery Chicago Inc. at Fleet National Bank, in each case, so long as the aggregate amount of the balances therein do not exceed $200,000 at any one time. "Holder" means a Person in whose name a Note is registered. "Intellectual Property" means the Copyrights, Trademarks and Patents. "IP Security Agreement" means an agreement by a Grantor in favor of the Collateral Agent substantially in the form of Exhibit A hereto. "Licenses" means the Copyright Licenses, the Trademark Licenses and the Patent Licenses. 4 "Material Adverse Effect" means a material adverse effect on the condition (financial or other), business, properties or results of operations of the Grantors and their respective subsidiaries taken as a whole. "Mortgage" means a mortgage (including, without limitation, a leasehold mortgage), deed of trust or deed to secure debt, in form and substance substantially the same as the mortgages delivered to Collateral Agent on the date hereof, made by a Grantor in favor of the Collateral Agent for the benefit of the Trustee and the Holders, securing the Senior Secured Note Obligations and delivered to the Collateral Agent. "New York UCC" means the Uniform Commercial Code, as from time to time in effect in the State of New York. "Patent Licenses" means all licenses, contracts or other agreements, whether written or oral, naming any Grantor as licensee or licensor and providing for the grant of any right to manufacture, use or sell any invention covered by any Patent (including, without limitation, all Patent Licenses set forth in Schedule II hereto). "Patents" means all domestic and foreign letters patent, design patents, utility patents, industrial designs, inventions, trade secrets, ideas, concepts, methods, techniques, processes, proprietary information, technology, know-how, formulae, rights of publicity and other general intangibles of like nature, now existing or hereafter acquired (including, without limitation, all domestic and foreign letters patent, design patents and utility patents described in Schedule II hereto), all applications, registrations and recordings of ownership thereof (including, without limitation, applications, registrations and recordings of ownership in the United States Patent and Trademark Office, or in any similar office or agency of the United States or any other country or any political subdivision thereof), and all reissues, divisions, continuations and continuations in part thereof. "Restricted Cash" means any cash or cash equivalents permitted to be deposited or pledged under clause (7), (12) or (14) of the definition of "Permitted Liens" in the Indenture. "Title Insurance Policy" means a mortgagee's loan policy, in form and substance satisfactory to the Collateral Agent, together with all endorsements made from time to time thereto, issued by or on behalf of First American Title Insurance Company (or other title insurance company reasonably satisfactory to the Collateral Agent), insuring the Lien created by a Mortgage in an amount and on terms reasonably satisfactory to the Collateral Agent, delivered to the Collateral Agent. "Trademark Licenses" means all licenses, contracts or other agreements, whether written or oral, naming any Grantor as licensor or licensee and providing for the grant of any right concerning any Trademark, together with any goodwill connected with and symbolized by any such trademark licenses, contracts or agreements and the right to prepare for sale or lease and sell or lease any and all Inventory now or hereafter owned by any Grantor and now or hereafter covered by such licenses (including, without limitation, all Trademark Licenses described in Schedule II hereto). 5 "Trademarks" means all domestic and foreign trademarks, service marks, collective marks, certification marks, trade names, business names, d/b/a's, Internet domain names, trade styles, designs, logos and other source identifiers and all general intangibles of like nature, now or hereafter owned, adopted, acquired or used by any Grantor (including, without limitation, all domestic and foreign trademarks, service marks, collective marks, certification marks, trade names, business names, d/b/a's and Internet domain names described in Schedule II hereto), all applications, registrations and recordings thereof (including, without limitation, applications, registrations and recordings of ownership in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state thereof or any other country or any political subdivision thereof), and all extensions and renewals thereof, together with all goodwill of the business symbolized by and associated with such marks and all customer lists, formulae and other Records of any Grantor relating to the distribution of products and services in connection with which any of such marks are used. SECTION 2. Grant of Security Interest. As collateral security for all of the Senior Secured Note Obligations, each Grantor hereby pledges and assigns to the Collateral Agent, and grants to the Collateral Agent, for the benefit of the Trustee and the Holders, a continuing security interest in, all personal property of such Grantor, wherever located and whether now or hereafter existing and whether now owned or hereafter acquired, of every kind and description, tangible or intangible (the "Collateral"), including, without limitation, the following: (a) all Accounts; (b) all Chattel Paper (whether tangible or electronic); (c) the Commercial Tort Claims specified on Schedule VI hereto; (d) all Deposit Accounts, all cash, and all other property from time to time deposited therein and the monies and property in the possession or under the control of the Collateral Agent, the Trustee, any Holder, any Credit Agreement Agent or any lender under any Qualified Credit Facility or any affiliate, representative, agent or correspondent of the Collateral Agent, the Trustee, any Holder, any such Credit Agreement Agent or any such lender; (e) all Documents; (f) all Equipment; (g) all Fixtures; (h) all General Intangibles (including, without limitation, all Payment Intangibles); (i) all Goods; (j) all Instruments (including, without limitation, Promissory Notes); (k) all Inventory; 6 (l) all Investment Property; (m) all Copyrights, Patents and Trademarks, and all Licenses; (n) all Letter-of-Credit Rights; (o) all Supporting Obligations; (p) all other tangible and intangible personal property of such Grantor (whether or not subject to the Code), including, without limitation, all bank and other accounts and all cash and all investments therein, all proceeds, products, offspring, accessions, rents, profits, income, benefits, substitutions and replacements of and to any of the property of such Grantor described in the preceding clauses of this Section 2 (including, without limitation, any proceeds of insurance thereon and all causes of action, claims and warranties now or hereafter held by such Grantor in respect of any of the items listed above), and all books, correspondence, files and other Records, including, without limitation, all tapes, disks, cards, Software, data and computer programs in the possession or under the control of such Grantor or any other Person from time to time acting for such Grantor that at any time evidence or contain information relating to any of the property described in the preceding clauses of this Section 2 or are otherwise necessary or helpful in the collection or realization thereof; and (q) all Proceeds, including all Cash Proceeds and Noncash Proceeds, and products of any and all of the foregoing Collateral; in each case howsoever such Grantor's interest therein may arise or appear (whether by ownership, security interest, claim or otherwise); provided, however, that notwithstanding any of the other provisions set forth in this Section 2, this Agreement shall not constitute a grant of a security interest in any of the Excluded Assets. SECTION 3. Security for Senior Secured Note Obligations. The security interest created hereby in the Collateral constitutes continuing collateral security for all of the Senior Secured Note Obligations. SECTION 4. Representations and Warranties. Each Grantor jointly and severally represents and warrants as follows (it being understood and agreed that, to the extent any Schedule hereto is required to be supplemented pursuant to Section 5 to reflect any change in facts or circumstances after the date hereof and such Schedule is supplemented for such change in accordance with Section 5, such Schedule shall be deemed supplemented to reflect such change in facts or circumstances from time to time of such change for all purposes of this Section 4): (a) Schedule I hereto sets forth (i) the exact legal name of each Grantor and (ii) the organizational identification number of each Grantor or states that no such organizational identification number exists. (b) Each Grantor (i) is a corporation, limited liability company or limited partnership duly organized, validly existing and in good standing under the laws of the state, province or jurisdiction of its organization as set forth on Schedule I hereto, (ii) has all requisite 7 power and authority to conduct its business as now conducted and as presently contemplated and to execute, deliver and perform this Agreement and each other Senior Secured Note Document to be executed and delivered by it pursuant hereto and to consummate the transactions contemplated hereby and thereby, and (iii) is duly qualified to do business and is in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary, except where the absence of any such qualification could not reasonably be expected to result in a Material Adverse Effect. (c) The execution, delivery and performance by each Grantor of this Agreement and each other Senior Secured Note Document to which such Grantor is or will be a party (i) have been duly authorized by all necessary action, (ii) do not and will not contravene its charter or by-laws, its limited liability company or operating agreement or its certificate of partnership or partnership agreement, as applicable, or any material applicable law or any material contractual restriction binding on or otherwise affecting such Grantor or any of its properties, (iii) do not and will not result in or require the creation of any Lien (other than pursuant to any Senior Secured Note Document or any Credit Facility Document) upon or with respect to any of its properties, other than Liens securing obligations in an aggregate amount not exceeding $100,000 and (iv) do not and will not result in any default, noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of any material permit, license, authorization or approval applicable to it or its operations or any of its properties. (d) This Agreement is, and each other Senior Secured Note Document to which any Grantor is or will be a party, when executed and delivered, will be, a legal, valid and binding obligation of such Grantor, enforceable against such Grantor in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. (e) There is no pending or, to the best knowledge of any Grantor, threatened action, suit or proceeding affecting any Grantor or its properties, before any court or other governmental authority or any arbitrator, or any order, judgment or award by any governmental authority or arbitrator, that could reasonably be expected to materially affect the grant by any Grantor, or the perfection, of the security interest purported to be created hereby in the Collateral, or the exercise by the Collateral Agent of any of its rights or remedies hereunder. (f) All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by any Grantor have been filed, or extensions have been obtained, and all taxes, assessments and other governmental charges imposed upon any Grantor or any property of such Grantor and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $100,000 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves have been set aside for the payment thereof on the most recently available consolidated financial statements of the Company to the extent required by and in accordance with GAAP. 8 (g) All Equipment, Fixtures, Goods and Inventory now existing and constituting Collateral are located and/or based at the addresses specified therefor in Schedule III hereto (as amended, supplemented or otherwise modified from time to time in accordance with the terms hereof), other than Equipment, Fixtures, Goods or Inventory in transit between any such locations and Goods or Inventory that have been sold (including sales on consignment or approval in the ordinary course of business) and each Grantor's chief place of business and chief executive office, the place where such Grantor keeps its Records concerning Accounts and all originals of all Chattel Paper are located at the addresses specified therefor in Schedule III hereto; provided that Schedule III hereto shall not contain any name or location of any Person (other than a Grantor) having possession of any Equipment, Fixtures, Goods, Inventory, Records or other assets having an aggregate book value of less than $25,000. As of the date hereof, none of the Accounts are evidenced by Promissory Notes or other Instruments. Set forth in Schedule IV hereto is a complete and accurate list, as of the date of this Agreement, of each Deposit Account, Securities Account and Commodities Account located in the United States of each Grantor, together with the name and address of each institution at which each such Account is maintained, the account number for each such Account and a description of the purpose of each such Account. Set forth in Schedule II hereto is (i) a complete and correct list of each trade name used by each Grantor and (ii) the name of, and each trade name used by, each Person from which such Grantor has acquired any substantial part of the Collateral within five years prior to the date hereof. (h) Each Grantor has delivered to the Collateral Agent complete and correct copies of each License described in Schedule II hereto, including all schedules and exhibits thereto, which represents all of the Licenses existing on the date of this Agreement material to the business of each Grantor. Each such License sets forth, in all material respects, the entire agreement and understanding of the parties thereto relating to the subject matter thereof, and there are no other material agreements, arrangements or understandings, written or oral, relating to the matters covered thereby or the rights of any Grantor or any of its Affiliates in respect thereof. Each License now existing is the legal, valid and binding obligation of the Grantors party thereto and, to the best knowledge of such Grantors, each other party thereto, enforceable against such parties in accordance with its terms (except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws and subject to general principals of equity, regardless of whether considered in a proceeding in equity or at law). No default thereunder by any Grantor has occurred, nor, to the best knowledge of any Grantor, does any defense, offset, deduction or counterclaim exist thereunder in favor of any such party thereto other than a Grantor. (i) The Grantors own and control, or otherwise possess adequate rights to use, all Trademarks, Patents and Copyrights, which are necessary to conduct their business in substantially the same manner as conducted as of the date hereof. Schedule II hereto sets forth a true and complete list of all Intellectual Property registrations and applications for registration owned by any Grantor and all Licenses material to the business of each Grantor as of the date hereof. All Intellectual Property scheduled on Schedule II hereto is subsisting and in full force and effect, has not been adjudged invalid or unenforceable, is, to the best knowledge of any Grantor, valid and enforceable and has not been abandoned in whole or in part. Except as set forth in Schedule II and except pursuant to any Permitted Lien, no such Intellectual Property is the subject of any licensing or franchising agreement. No Grantor has any knowledge of any 9 conflict with the rights of others to any Intellectual Property it owns, and, except as set forth in Schedule II hereto, to the best knowledge of each Grantor, no Grantor is now infringing or in conflict with any such rights of others in any material respect, and to the best knowledge of each Grantor, no other Person is now infringing or in conflict in any material respect with the Intellectual Property owned by such Grantor. Except as set forth in Schedule II hereto, (i) no claim, litigation, arbitration or other adversarial proceeding is pending relating to any claim that any Grantor is violating or has violated the trademarks, patents, copyrights, rights of publicity or other intellectual property rights of any third party, and (ii) to the extent any Grantor received notice of any such claim in the five (5) year period immediately preceding the date hereof, no such notice (or any claim referred to therein) remains unresolved as of the date hereof. (j) The Grantors are and will be at all times the sole and exclusive owners of, or otherwise have and will have adequate rights in, the Collateral free and clear of any Lien except for (i) the Lien created by this Agreement and (ii) the Permitted Liens. No effective financing statement or other instrument similar in effect covering all or any part of the Collateral is on file in any recording or filing office except (A) such as may have been filed in favor of the Collateral Agent relating to this Agreement and (B) such as may have been filed to perfect or protect any Permitted Lien. (k) The exercise by the Collateral Agent of any of its rights and remedies expressly enumerated in this Agreement, subject to the terms of the Intercreditor Agreement and the rights of Persons holding Permitted Liens, will not contravene any law or any material contractual restriction binding on or otherwise affecting any Grantor or any of its material properties and will not result in, or require the creation of, any Lien upon or with respect to any of its properties. (l) No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority is required for (i) the grant by any Grantor, or the perfection, of the security interest purported to be created hereby in the Collateral or (ii) the exercise by the Collateral Agent of any of its rights and remedies expressly enumerated in this Agreement (other than with respect to Investment Property constituting Capital Stock (whether or not certificated) of any Person who is organized or formed under the laws of a jurisdiction other than the District of Columbia or any State or territory of the United States of America), except (A) for the filing under the Uniform Commercial Code as in effect in the applicable jurisdiction of the financing statements as described in Schedule V hereto, all of which financing statements, filings and other recordings, as applicable, have been duly filed and are in full force and effect, (B) with respect to the perfection of the security interest created hereby in the United States Intellectual Property registrations and applications for registration owned by any Grantor, for the recording of the appropriate IP Security Agreement, substantially in the form of Exhibit A hereto, together with the submission of the required recording fees and other required documents, in the United States Patent and Trademark Office or the United States Copyright Office, as applicable, within the three-month period pursuant to 35 U.S.C. Section 261 or 15 U.S.C. Section 1060 or the one-month period pursuant to 17 U.S.C. Section 205, (C) with respect to the perfection of the security interest created hereby in motor vehicles (including, without limitation, all trucks, trailers, tractors, service vehicles, automobiles and other mobile equipment) for which the title to such motor vehicles is governed by a certificate of title or ownership (collectively, the "Motor Vehicles"), for the submission of an appropriate application requesting that the Lien of the Collateral Agent be 10 noted on the certificate of title or ownership, completed and authenticated by the applicable Grantor, together with the certificate of title, with respect to each Motor Vehicle, to the appropriate state agency, (D) with respect to any action that may be necessary to obtain control of Collateral described in Sections 5(i) and 5(k) hereof, the taking of such actions and, (E) the taking possession of all Documents, Chattel Paper, Instruments and cash constituting Collateral and (F) to the extent applicable, as may be required in connection with any sale of any Collateral by laws affecting the offering and sale of securities generally other than those that have been obtained or made and are in full force and effect. (m) This Agreement creates in favor of the Collateral Agent for the benefit of the Trustee and the Holders a legal, valid and enforceable security interest in the Collateral, as security for the Senior Secured Note Obligations. The Collateral Agent's having possession (or, with respect to Collateral constituting Credit Facility Priority Collateral, the Credit Facility Agent having possession, as agent for the Collateral Agent pursuant to the terms of the Intercreditor Agreement) of all Instruments, Documents and Chattel Paper and cash constituting Collateral and obtaining control of all Collateral described in Sections 5(i) and 5(k) hereof from time to time, with respect to United States Intellectual Property registrations and applications for registration owned by the Grantors, the recording of the appropriate IP Security Agreement executed pursuant hereto, together with the submission of the required recording fees and other required documents, in the United States Patent and Trademark Office and the United States Copyright Office, as applicable, within the three-month period pursuant to 35 U.S.C. Section 261 or 15 U.S.C. Section 1060 or the one-month period pursuant to 17 U.S.C. Section 205, the submission, at the request of the Collateral Agent pursuant to Section 5(j), of an appropriate application requesting that the Lien of the Collateral Agent be noted on the certificate of title or ownership, completed and authenticated by the applicable Grantor, together with the certificate of title or ownership, with respect to such Motor Vehicles, to the applicable state agency, and the filing of the financing statements and the other filings and recordings, as applicable, described in Schedule V hereto and, with respect to the United States Intellectual Property registrations and applications for registration that are hereafter existing and owned by the Grantors and not covered by an appropriate IP Security Agreement, the recording in the United States Patent and Trademark Office or the United States Copyright Office, as applicable, of appropriate instruments of assignment for security together with submission of the required recording fees and other required documents, result in the perfection of such security interests, to the extent governed by Articles 8 and 9 of the Code. To the extent governed by Articles 8 and 9 of the New York UCC, such security interests are, or in the case of Collateral in which any Grantor obtains rights after the date hereof, will be, perfected security interests (other than, as to perfection, Restricted Cash and Excluded Deposit Accounts), subject only to Permitted Prior Liens and Credit Facility Liens that are prior to the Liens held by the Collateral Agent, for the benefit of the Trustee and the Holders, and the recording of such instruments of assignment. Such recordings and filings and all other actions necessary or desirable to perfect and protect such security interest under Articles 8 and 9 of the New York UCC have been duly taken, except for (i) the Collateral Agent's having possession of Instruments, Documents and Chattel Paper and cash (other than Restricted Cash) constituting Collateral after the date hereof, (ii) the Collateral Agent obtaining control of any Collateral described in Sections 5(i) and 5(k) of this Agreement after the date hereof and (iii) the other filings and recordations described in Section 4(l) hereof. 11 (n) As of the date hereof, no Grantor holds any Commercial Tort Claims, with a claim exceeding $100,000, or is aware of any such pending claims in respect of which any Grantor has a reasonable expectation of recovering in excess of $100,000, except for such claims described in Schedule VI. (o) The partnership interests or membership interests of each Grantor in each of its Subsidiaries that is a partnership or a limited liability company (excluding joint ventures) are not (i) dealt in or traded on securities exchanges or in securities markets, (ii) securities for purposes of Article 8 of any relevant Uniform Commercial Code, (iii) investment company securities within the meaning of Section 8-103 of any relevant Uniform Commercial Code and (iv) evidenced by a certificate. Such partnership interests or membership interests constitute General Intangibles. SECTION 5. Covenants as to the Collateral. Until the Discharge of the Senior Secured Note Obligations, unless the Collateral Agent shall otherwise consent in writing: (a) Further Assurances. Each Grantor will at its expense, at any time and from time to time, promptly execute and deliver all further instruments and documents and take all further action that the Collateral Agent may determine to be reasonably necessary or desirable to (i) perfect and protect the security interest purported to be created hereby; (ii) enable the Collateral Agent to exercise and enforce its rights and remedies hereunder in respect of the Collateral; or (iii) otherwise effect the purposes of this Agreement, including, without limitation: (A) from and after the date upon which the Discharge of Credit Facility Obligations has occurred, marking conspicuously all Chattel Paper (to the extent such Chattel Paper is not in the possession of the Collateral Agent) with a legend, in form and substance reasonably satisfactory to the Collateral Agent, indicating that such Chattel Paper is subject to the security interest created hereby, (B) from and after the date upon which the Discharge of Credit Facility Obligations has occurred, if any Account shall be evidenced by Promissory Notes or other Instruments or Chattel Paper, delivering and pledging to the Collateral Agent (or its agent) hereunder such Promissory Notes, Instruments or Chattel Paper, duly endorsed and accompanied by executed instruments of transfer or assignment, all in form and substance reasonably satisfactory to the Collateral Agent, (C) executing and filing (to the extent, if any, that such Grantor's signature is required thereon) or authenticating the filing of, such financing or continuation statements, or amendments thereto, as the Collateral Agent may determine to be reasonably necessary or desirable to perfect and preserve the security interest purported to be created hereby, (D) furnishing to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Collateral Agent may reasonably request, all in reasonable detail, (E) if any Collateral shall be in the possession of a third party, notifying such Person of the Collateral Agent's security interest created hereby and using its reasonable efforts to obtain a landlord waiver or bailee letter or such other written acknowledgment from such Person that such Person holds possession of the Collateral for the benefit of the Collateral Agent, which such written acknowledgment shall be in form and substance reasonably satisfactory to the Collateral Agent, provided that, such Grantor's obligation to obtain such landlord waiver, bailee letter or other written acknowledgement with respect to any Collateral constituting Credit Facility Priority Collateral shall only be applicable from and after the date upon which the Discharge of Credit Facility Obligations has occurred, (F) if, at any time after the date hereof, any Grantor acquires 12 or holds any Commercial Tort Claim, promptly notifying the Collateral Agent in a writing signed by such Grantor setting forth a brief description of such Commercial Tort Claim and granting to the Collateral Agent a security interest therein and in the proceeds thereof, which writing shall incorporate the provisions hereof and shall be in form and substance reasonably satisfactory to the Collateral Agent, and (G) at the request of the Collateral Agent, upon the acquisition after the date hereof by any Grantor of any Motor Vehicle or other Equipment subject to a certificate of title or ownership (other than a Motor Vehicle or Equipment that is subject to a purchase money security interest permitted by Section 4.12 of the Indenture), immediately notifying the Collateral Agent of such acquisition, setting forth a description of the Motor Vehicle or other Equipment acquired and a good faith estimate of the current value of such Motor Vehicle or Equipment, and if so requested by the Collateral Agent, immediately causing the Collateral Agent to be listed as the lienholder on such certificate of title or ownership and delivering evidence of the same to the Collateral Agent. (b) Location of Equipment and Inventory. Each Grantor will keep the Equipment and Inventory (other than Inventory and used Equipment sold in the ordinary course of business in accordance with Section 5(g) hereof and Equipment and Inventory not required to be at such location pursuant to Section 4(g) hereof) at one or more of the locations specified therefor in Section 4(g) hereof or, upon not less than thirty (30) days' prior written notice to the Collateral Agent accompanied by a new Schedule III hereto indicating each new location of the Equipment and Inventory, in each case, with an aggregate book value exceeding $100,000, at such other locations in the continental United States, as the Grantors may elect, provided that (i) all action has been taken to grant to the Collateral Agent a perfected security interest in such Equipment and Inventory (subject only to Permitted Prior Liens and Credit Facility Liens that are prior to the Liens held by the Collateral Agent, for the benefit of the Trustee and the Holder), and (ii) the Collateral Agent's rights in such Equipment and Inventory, including, without limitation, the existence, perfection and priority of the security interest created hereby in such Equipment and Inventory, are not adversely affected thereby. (c) Condition of Equipment. Each Grantor will maintain or cause the Equipment to be maintained and preserved in working order and condition, ordinary wear and tear excepted, and will forthwith, or in the case of any material loss or damage to any Equipment as promptly as practicable after the occurrence thereof, make or cause to be made all repairs, replacements and other improvements in connection therewith which are necessary or desirable, consistent with past practice, or which the Collateral Agent may reasonably request to such end. Each Grantor will promptly furnish to the Collateral Agent a statement describing in reasonable detail any loss or damage in excess of $100,000 to any Equipment. (d) Taxes, Etc. Each Grantor jointly and severally agrees to pay promptly when due all property and other taxes, assessments and governmental charges or levies imposed upon, and all claims (including claims for labor, materials and supplies) against, the Equipment and Inventory, except to the extent the validity thereof is being contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, in accordance with GAAP have been set aside for the payment thereof. 13 (e) Insurance. (i) Each Grantor will, at its own expense: (A) keep its properties adequately insured at all times by responsible and reputable insurers; (B) maintain such other insurance, to such extent and against such risks (and with such deductibles, retentions and exclusions), including fire and other risks insured against by extended coverage and coverage for acts of terrorism, as is customary with companies in the same or similar businesses operating in the same or similar locations, including public liability insurance against claims for personal injury or death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled by it; (C) maintain such other insurance as may be required by law provided, however, that each Grantor may maintain self-insurance (which shall include insurance maintained through Milacron Assurance Ltd., a Bermuda Company) in connection with the above insurance requirements to the extent, reasonably prudent and consistent with past practice. In addition, (A) each such liability policy (other than any Director's and Officer's liability policy and any Fiduciary Responsibility liability policy) shall name each Grantor and the Collateral Agent (and such other Persons as the Collateral Agent may designate from time to time) as additional insured thereunder (without any representation or warranty by or obligation upon the Collateral Agent or such other Person) as their interests may appear and each property policy shall name each Grantor and the Collateral Agent as loss payees as their interests may appear, (B) each property policy shall contain an agreement by the insurer that any loss thereunder shall be payable to the Collateral Agent, as its interest may appear, on its own account notwithstanding any action, inaction or breach of representation or warranty by any Grantor, (C) each such policy shall provide that there shall be no recourse against the Collateral Agent for payment of premiums or other amounts with respect thereto and (D) each such policy shall provide that at least thirty (30) days' prior written notice of cancellation, lapse, expiration or other adverse change shall be given to the Collateral Agent by the insurer. Each Grantor will, if so requested by the Collateral Agent, deliver to the Collateral Agent certificates of insurance evidencing such insurance and, as often as the Collateral Agent may reasonably request, a report of a reputable insurance broker with respect to such insurance. Each Grantor will also, at the request of the Collateral Agent, execute and deliver instruments of assignment of such insurance policies and cause the respective insurers to acknowledge notice of such assignment. (ii) Reimbursement under any liability insurance maintained by any Grantor pursuant to this Section 5(e) may be paid directly to the Person who shall have incurred liability covered by such insurance. 14 (iii) After Acquired Real Property. Each Grantor shall, upon the acquisition by such Grantor thereof after the date of the Indenture of any interest (whether fee or leasehold) in any real property (wherever located) other than an interest constituting an Excluded Asset (each such interest being an "After Acquired Property") (x) with a Current Value (as defined below) in excess of $750,000 in the case of a fee interest, or (y) requiring the payment of annual rent exceeding in the aggregate $100,000 in the case of a leasehold interest, promptly so notify the Collateral Agent, setting forth with specificity a description of the interest acquired, the location of the real property, any structures or improvements thereon and either an appraisal or such Grantor's good-faith estimate of the current value of such real property (for purposes of this Section, the "Current Value"). The Collateral Agent shall notify such Grantor whether it intends to require a Mortgage and the other documents referred to below or in the case of leasehold, a leasehold Mortgage or landlord waiver (pursuant to Section 5(a)). Upon receipt of such notice requesting a Mortgage, the Grantor which has acquired such After Acquired Property shall promptly furnish to the Collateral Agent the following, each in form and substance reasonably satisfactory to the Collateral Agent: (i) a Mortgage with respect to such real property and related assets located at the After Acquired Property, each duly executed by such Person and in recordable form, (ii) evidence of the recording of the Mortgage referred to in clause (i) above in such office or offices as may be necessary or, in the opinion of the Collateral Agent, desirable to create and perfect a valid and enforceable first priority lien on the property purported to be covered thereby or to otherwise protect the rights of the Collateral Agent and the Trustee and the Holders thereunder, (iii) a Title Insurance Policy, (iv) a survey of such real property, certified to the Collateral Agent and to the issuer of the Title Insurance Policy by a licensed professional surveyor reasonably satisfactory to the Collateral Agent, (v) at the Collateral Agent's reasonable request, Phase I Environmental Site Assessments, or such other non-intrusive and non-Phase II environmental assessment as the Collateral Agent may reasonably request, with respect to such real property, by a consultant reasonably satisfactory to the Collateral Agent, (vi) in the case of a leasehold interest, a certified copy of the lease between the landlord and such Person with respect to such real property in which such Person has a leasehold interest, and the certificate of occupancy with respect thereto, (vii) in the case of a leasehold interest, an attornment and nondisturbance agreement between the landlord (and any fee mortgagee) with respect to such real property and the Collateral Agent, and (viii) such other documents or instruments (including guarantees and opinions of counsel) as the Collateral Agent may reasonably require. The applicable Grantor shall pay all reasonable fees and expenses, including reasonable attorneys' fees and expenses, and all title insurance charges and premiums, in connection with such Grantor's obligations under this Section 5(e)(iii). (f) Provisions Concerning Certain Accounts and the Licenses. (i) No Grantor shall, without prior written notice to the Collateral Agent, change (A) such Grantor's name, identity or organizational structure or (B) its jurisdiction of incorporation as set forth in Section 4(b) hereto. Each Grantor shall (x) promptly notify the Collateral Agent upon obtaining an organizational identification number, if on the date hereof such Grantor did not have such identification number, and (y) keep adequate records concerning the Accounts and Chattel Paper and permit representatives of the Collateral Agent, upon reasonable prior notice and during normal business hours, to inspect and make abstracts from such Records and Chattel Paper. 15 (ii) Each Grantor will, except as otherwise provided in this subsection (f), continue to collect, at its own expense, all amounts due or to become due under the Accounts. In connection with such collections, each Grantor may (and, at the Collateral Agent's (or its agent's) direction, will) take such action as such Grantor or the Collateral Agent (or its agent) may deem reasonably necessary or advisable to enforce collection or performance of the Accounts; provided, however, that the Collateral Agent (or its agent) shall have the right at any time following the date upon which the Discharge of Credit Facility Obligations has occurred, upon the occurrence and during the continuance of an Event of Default, to notify the Account Debtors or obligors under any Accounts of the assignment of such Accounts to the Collateral Agent (or its agent) and to direct such Account Debtors or obligors to make payment of all amounts due or to become due to such Grantor thereunder directly to the Collateral Agent or its designated agent and, upon such notification and at the expense of such Grantor and to the extent permitted by law, to enforce collection of any such Accounts and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done. After receipt by any Grantor of a notice from the Collateral Agent that the Collateral Agent has notified, intends to notify, or has enforced or intends to enforce a Grantor's rights against the Account Debtors or obligors under any Accounts as referred to in the proviso to the immediately preceding sentence, (A) all amounts and proceeds (including Instruments) received by such Grantor in respect of the Accounts shall be received in trust for the benefit of the Collateral Agent hereunder, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Collateral Agent or its designated agent in the same form as so received (with any necessary endorsement) to be held as cash collateral and, if an Event of Default shall have occurred and be continuing, applied as specified in Section 7(b) hereof, and (B) such Grantor will not adjust, settle or compromise the amount or payment of any Account or release wholly or partly any Account Debtor or obligor thereof or allow any credit or discount thereon. In addition, following the date upon which the Discharge of Credit Facility Obligations has occurred, upon the occurrence and during the continuance of an Event of Default, the Collateral Agent (or its agent) may (in its sole and absolute discretion) direct any or all of the banks and financial institutions with which any Grantor either maintains a Deposit Account or a lockbox or deposits the proceeds of any Accounts to send immediately to the Collateral Agent or its designated agent by wire transfer (to such cash management accounts as the Collateral Agent shall specify, or in such other manner as the Collateral Agent (or its agent) shall direct) all or a portion of such securities, cash, investments and other items held by such institution. Any such securities, cash, investments and other items so received by the Collateral Agent or its designated agent shall (in the sole and absolute discretion of the Collateral Agent or such designated agent) be held as additional Collateral for the Senior Secured Note Obligations or distributed in accordance with Section 7 hereof. 16 (iii) Upon the occurrence and during the continuance of any material breach or default under any License material to the conduct of a Grantor's business or any License under which any material Intellectual Property owned by a Grantor is licensed to a third party, by any party thereto other than a Grantor, (A) the relevant Grantor will, promptly after obtaining knowledge thereof, give the Collateral Agent written notice of the nature and duration thereof, specifying what action, if any, it has taken and proposes to take with respect thereto, (B) no Grantor will, without the prior written consent of the Collateral Agent, declare or waive any such breach or default or affirmatively consent to the cure thereof or exercise any of its remedies in respect thereof, and (C) each Grantor will, upon written instructions from the Collateral Agent and at such Grantor's expense, take such action as the Collateral Agent may deem reasonably necessary or advisable in respect thereof. (iv) Each Grantor will, at its expense, promptly deliver to the Collateral Agent a copy of each material notice or other material communication received by it by which any other party to any License material to the operation of a Grantor's business or any License under which any material Intellectual Property owned by a Grantor is licensed to a third party purports to exercise any of its rights or affect any of its obligations thereunder, in a manner adverse to any Grantor, together with a copy of any reply by such Grantor thereto. (v) Each Grantor will exercise promptly and diligently each and every right which it may have under each License (other than any right of termination) and will duly perform and observe in all respects all of its material obligations under each License and will take all action necessary to maintain the Licenses that are material to the continued operation of such Grantor's business in full force and effect. No Grantor will, without the prior written consent of the Collateral Agent, cancel, terminate, amend or otherwise modify in any respect, or waive any material provision of, any License referred to in Schedule II hereto that are material to the continued operation of such Grantor's business. (g) Transfers and Other Liens. (i) Except to the extent not prohibited by Section 4.10 of the Indenture, no Grantor will sell, assign (by operation of law or otherwise), lease, license, exchange or otherwise transfer or dispose of any of the Collateral. (ii) Except to the extent not prohibited by Section 4.12 of the Indenture, no Grantor will create, suffer to exist or grant any Lien upon or with respect to any Collateral. (h) Intellectual Property. (i) If applicable, each Grantor has duly executed and delivered the applicable IP Security Agreement in the form attached hereto as Exhibit A. Each Grantor (either itself or through licensees) will, and will cause each licensee thereof to, take all action necessary to maintain the Intellectual Property in full force and effect, including, without limitation, using the proper statutory notices and markings and using the Trademarks on each applicable trademark class of goods in order to so maintain the Trademarks in full force, free from any claim of abandonment for non-use, and no Grantor will (nor permit any licensee thereof to) do 17 any act or knowingly omit to do any act whereby any Intellectual Property may become invalidated; provided, however, that so long as no Event of Default has occurred and is continuing, no Grantor shall have an obligation to use or to maintain any Intellectual Property (A) that relates solely to any product or work, that has been, or is in the process of being, discontinued, abandoned or terminated, (B) that is being replaced with Intellectual Property substantially similar to the Intellectual Property that may be abandoned or otherwise become invalid, so long as the failure to use or maintain such Intellectual Property does not materially adversely affect the validity of such replacement Intellectual Property and so long as such replacement Intellectual Property is subject to the Lien created by this Agreement, (C) that is substantially the same as another Intellectual Property that is in full force, so long as the failure to use or maintain such Intellectual Property does not materially adversely affect the validity of such replacement Intellectual Property and so long as such other Intellectual Property is subject to the Lien and security interest created by this Agreement or (D) is otherwise no longer material to the Business of such Grantor and is no longer of any other material value. Each Grantor will cause to be taken all necessary steps in any proceeding before the United States Patent and Trademark Office and the United States Copyright Office or any similar office or agency in any other country or political subdivision thereof to maintain each registration of the Intellectual Property (other than the Intellectual Property described in the proviso to the immediately preceding sentence), including, without limitation, filing of renewals, affidavits of use, affidavits of incontestability and opposition, interference and cancellation proceedings and payment of maintenance fees, filing fees, taxes or other governmental fees. If any Intellectual Property material to the operation of a Grantor's business or that generates licensing revenue is infringed, misappropriated, diluted or otherwise violated in any material respect by a third party, the Grantors shall (x) upon obtaining knowledge of such infringement, misappropriation, dilution or other violation, promptly notify the Collateral Agent and (y) to the extent the Grantors shall deem appropriate under the circumstances, promptly sue for infringement, misappropriation, dilution or other violation, seek injunctive relief where appropriate and recover any and all damages for such infringement, misappropriation, dilution or other violation, or take such other actions as the Grantors shall deem appropriate under the circumstances to protect such Intellectual Property. Each Grantor shall furnish to the Collateral Agent, from time to time upon the Collateral Agent's request, statements and schedules further identifying and describing the Intellectual Property and Licenses and such other reports in connection with the Intellectual Property and Licenses as the Collateral Agent may reasonably request, all in reasonable detail and promptly upon request of the Collateral Agent, following receipt by the Collateral Agent of any such statements, schedules or reports, the Grantors shall modify this Agreement by amending Schedule II hereto, as the case may be, to include any Intellectual Property and License, as the case may be, which becomes part of the Collateral under this Agreement and shall execute and authenticate such documents and do such acts as shall be necessary or, in the judgment of the Collateral Agent, desirable to subject such Intellectual Property and Licenses to the Lien and security interest created by this Agreement. Notwithstanding anything herein to the contrary, upon the occurrence and during the continuance of an Event of Default, no Grantor may abandon any of those Intellectual Property registrations, applications for registration or material unregistered Trademarks owned by such Grantor, nor may any Grantor do or omit to do anything, which action or omission would be reasonably likely to result in the invalidity of any Intellectual Property registration or application for registration owned by such Grantor or the loss of any trade secret owned by such Grantor without the prior written consent of the Collateral 18 Agent, and if any Intellectual Property owned by any Grantor is infringed, misappropriated, diluted or otherwise violated in any material respect by a third party, the Grantors will take such action as the Collateral Agent shall deem appropriate under the circumstances to protect such Intellectual Property. (ii) In no event shall any Grantor, either itself or through any agent, employee, licensee or designee, file an application for the registration of any Trademark or Copyright or the issuance of any Patent with the United States Patent and Trademark Office or the United States Copyright Office, as applicable, or in any similar office or agency of the United States or any country or any political subdivision thereof unless it promptly notifies the Collateral Agent thereof. Upon request of the Collateral Agent, each Grantor shall execute, authenticate and deliver any and all assignments, agreements, instruments, documents and papers as the Collateral Agent may reasonably request to evidence the Collateral Agent's security interest hereunder in such Intellectual Property and the General Intangibles of such Grantor relating thereto or represented thereby, and each Grantor hereby appoints the Collateral Agent its attorney-in-fact to execute and/or authenticate and file all such writings for the foregoing purposes, all acts of such attorney being hereby ratified and confirmed, and such power (being coupled with an interest) shall be irrevocable until date on which the Discharge of Senior Secured Note Obligations has occurred. (i) Deposit, Commodities and Securities Accounts. Each Grantor shall cause each bank and other financial institution with an account referred to in Schedule IV hereto to execute and deliver to the Collateral Agent (or its agent) a control agreement, in form and substance reasonably satisfactory to the Collateral Agent, duly executed by such Grantor and such bank or financial institution, or enter into other arrangements in form and substance satisfactory to the Collateral Agent, pursuant to which such institution shall irrevocably agree (except to the extent otherwise agreed to by the Trustee and the Collateral Agent), among other things, that (i) it will comply at any time with the instructions originated by the Collateral Agent (or its agent) to such bank or financial institution directing the disposition of cash, Commodity Contracts, securities, Investment Property and other items from time to time credited to such account, without further consent of such Grantor, which instructions the Collateral Agent (or its agent) will not give to such bank or other financial institution in the absence of a continuing Event of Default, (ii) all cash, Commodity Contracts, securities, Investment Property and other items of such Grantor deposited with such institution shall be subject to a perfected, first priority security interest in favor of the Collateral Agent (or its agent), (iii) any right of set off, banker's Lien or other similar Lien, security interest or encumbrance shall be fully waived as against the Collateral Agent (or its agent), and (iv) such bank or financial institution shall immediately send to the Collateral Agent (or its agent) by wire transfer (to such account as the Collateral Agent (or its agent) shall specify, or in such other manner as the Collateral Agent (or its agent) shall direct) all such cash, the value of any Commodity Contracts, securities, Investment Property and other items held by it. The Collateral Agent agrees with each of the Grantors that in respect of any control agreement that provides for shared control between the Collateral Agent (or its agent) and a Grantor in respect of any Deposit Account, Commodity Account or Securities Account, the Collateral Agent (or its agent) shall not deliver to the bank or financial institution a notice of exclusive control in respect of such Deposit Account, Commodity Account or Securities Account unless there is an occurrence and continuance of an Event of Default. The Collateral Agent further agrees with each of the Grantors to withdraw any such notice of exclusive control as soon 19 as practicable upon such Event of Default ceasing to exist. Without the prior written consent of the Collateral Agent (or its agent), no Grantor shall make or maintain any Deposit Account, Commodity Account or Securities Account except for the accounts set forth in Schedule IV hereto. Notwithstanding the foregoing, the provisions of this paragraph 5(i) shall not apply to Excluded Accounts or, until the date upon which the Discharge of Credit Facility Obligations has occurred, any Collateral consisting of Credit Facility Priority Collateral. (j) Motor Vehicles. (i) At the reasonable request of the Collateral Agent, each Grantor shall (a) cause all Motor Vehicles that constitute Collateral, now owned or hereafter acquired by any Grantor, which under applicable law are required to be registered, to be properly registered in the name of such Grantor, (b) cause all Motor Vehicles that constitute Collateral, now owned or hereafter acquired by any Grantor, the ownership of which under applicable law (including without limitation, any Motor Vehicle Law), is evidenced by a certificate of title or ownership, to be properly titled in the name of such Grantor, with the Collateral Agent's Lien noted thereon and (c) if requested by the Collateral Agent, deliver to the Collateral Agent (or its custodian) originals of all such certificates of title or ownership for such Motor Vehicles, with the Collateral Agent's Lien noted thereon. (ii) At the request of the Collateral Agent, upon the acquisition after the date hereof by any Grantor of any Motor Vehicle or other Equipment that constitutes Collateral subject to a certificate of title or ownership (other than a Motor Vehicle or Equipment to be acquired that is subject to a purchase money security interest permitted by Section 4.12 of the Indenture), such Grantor shall promptly notify the Collateral Agent of such acquisition, set forth a description of the Motor Vehicle or other Equipment acquired and a good faith estimate of the current value of such Motor Vehicle or Equipment, and if so requested by the Collateral Agent, promptly deliver to the Collateral Agent (or its custodian) originals of the certificates of title or ownership for such Motor Vehicle or Equipment, together with the manufacturer's statement of origin, and an application duly executed by the appropriate Grantor to evidence the Collateral Agent's Lien thereon. (iii) Subject to clauses (j)(i) and (j)(ii) above, each Grantor hereby appoints the Collateral Agent as its attorney-in-fact, effective the date hereof and terminating upon the termination of this Agreement, for the purpose of (A) executing on behalf of such Grantor title or ownership applications for filing with appropriate state or provincial agencies to enable Motor Vehicles that constitute Collateral, now owned or hereafter acquired by such Grantor, to be retitled and the Collateral Agent listed as lienholder thereof, and (B) filing such applications with such state or provincial agencies. This appointment as attorney-in-fact is coupled with an interest and is irrevocable until the date on which the Discharge of Senior Secured Note Obligations has occurred. (iv) Any certificates of title or ownership delivered pursuant to the terms hereof shall be accompanied by odometer statements for each Motor Vehicle covered thereby. 20 (v) So long as no Event of Default shall have occurred and be continuing, upon the request of any Grantor, the Collateral Agent shall execute and deliver to such Grantor such instruments as such Grantor shall reasonably request to remove the notation of the Collateral Agent as lienholder on any certificate of title for any Motor Vehicle; provided that any such instruments shall be delivered, and the release effective, only upon receipt by the Collateral Agent of a certificate from such Grantor, stating that the Motor Vehicle, the Lien on which is to be released, is to be sold or has suffered a casualty loss (with title thereto passing to the casualty insurance company therefor in settlement of the claim for such loss) and the amount that such Grantor will receive as sale proceeds or insurance proceeds. (k) Control. Each Grantor hereby agrees to take any or all action that the Collateral Agent may determine to be reasonably necessary or desirable in order for the Collateral Agent (or its agent) to obtain control in accordance with Sections 9-104, 9-105, 9-106, and 9-107 of the Code with respect to the following Collateral: (i) Deposit Accounts, (ii) Electronic Chattel Paper, (iii) Investment Property and (iv) Letter-of-Credit Rights; provided, however, that no such action shall be required with respect to any Collateral constituting Credit Facility Priority Collateral until on or after the date upon which the Discharge of Credit Facility Obligations has occurred. (l) Inspection and Reporting. Each Grantor shall permit the Collateral Agent, or any agents or representatives thereof or such professionals or other Persons as the Collateral Agent may reasonably designate subject to a confidentiality agreement reasonably satisfactory to the Company, upon reasonably prior notice and during normal business hours, (i) to examine and make copies of and abstracts from such Grantor's records and books of account, (ii) to visit and inspect its properties, (iii) to verify materials, leases, notes, Accounts, Inventory and other assets of such Grantor from time to time and (iv) to conduct audits, physical counts, appraisals and/or valuations, Phase I Environmental Site Assessments or examinations at the locations of such Grantor. (m) Partnership and Limited Liability Company Interest. No Grantor that is a partnership or a limited liability company shall, nor shall any Grantor with any Subsidiary that is a partnership or a limited liability company, permit such partnership interests or membership interests (excluding joint venture interests) to (i) be dealt in or traded on securities exchanges or in securities markets, (ii) become a security for purposes of Article 8 of any relevant Uniform Commercial Code, (iii) become an investment company security within the meaning of Section 8-103 of any relevant Uniform Commercial Code or (iv) be evidenced by a certificate; provided, however, (A) if any Grantor's joint venture interests become evidenced by a certificate, such Grantor shall receive such certificate in trust for the benefit of the Collateral Agent, shall segregate it from such Grantor's other property and shall deliver it forthwith to the Collateral Agent subject to the requirements set forth in the Pledge Agreement and (B) if such Grantor is not party to the Pledge Agreement, such Grantor shall immediately execute and deliver a joinder agreement and become a party to the Pledge Agreement. Each Grantor agrees that such partnership interests or membership interests (including, without limitation, any such interests in joint ventures that are not certificated) shall constitute General Intangibles. 21 SECTION 6. Additional Provisions Concerning the Collateral. (a) Each Grantor hereby (i) authorizes the Collateral Agent to file, one or more financing or continuation statements, and amendments thereto, relating to the Collateral (including, without limitation, any such financing statements that indicate the Collateral as "all assets" or words of similar import) and (ii) ratifies such authorization to the extent that the Collateral Agent has filed any such financing or continuation statements, or amendments thereto, prior to the date hereof. A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted by law. (b) Each Grantor hereby irrevocably appoints the Collateral Agent as its attorney-in-fact and proxy, with full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, and upon the occurrence and during the continuance of an Event of Default, the Collateral Agent may take any action and execute any instrument which the Collateral Agent may deem reasonably necessary or advisable to accomplish the purposes of this Agreement (subject to the rights of a Grantor under Section 5 hereof), including, without limitation, (i) to ask, demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneys due and to become due under or in respect of any Collateral, (ii) to receive, endorse, and collect any drafts or other instruments, documents and chattel paper in connection with clause (i) above, (iii) to file any claims or take any action or institute any proceedings which the Collateral Agent may deem necessary or desirable for the collection of any Collateral or otherwise to enforce the rights of the Collateral Agent, the Trustee and the Holders with respect to any Collateral, and (iv) to execute assignments, licenses and other documents to enforce the rights of the Collateral Agent, the Trustee and the Holders with respect to any Collateral. This power is coupled with an interest and is irrevocable until the date on which the Discharge of Senior Secured Note Obligations has occurred. (c) For the purpose of enabling the Collateral Agent to exercise rights and remedies hereunder, at such time as the Collateral Agent shall be lawfully entitled to exercise such rights and remedies, and for no other purpose, each Grantor hereby grants to the Collateral Agent, to the extent assignable, an irrevocable, non-exclusive license (exercisable without payment of royalty or other compensation to any Grantor) to use, assign, license or sublicense any Intellectual Property now owned or hereafter acquired by any Grantor (excluding Intellectual Property that is subject to a License from third parties to the extent such License expressly prohibits any of the actions specified herein, unless otherwise subject to a consent, waiver or other agreement permitting the taking of such actions specified herein), wherever the same may be located, including in such license reasonable access to all media in which any of the licensed items may be recorded or stored and to all computer programs used for the compilation or printout thereof. Notwithstanding anything contained herein to the contrary, but subject to the provisions of the Indenture that limit the right of a Grantor to dispose of its property and Section 5(h) hereof, so long as no Event of Default shall have occurred and be continuing, each Grantor may exploit, use, enjoy, protect, license, sublicense, assign, sell, dispose of or take other actions with respect to the Intellectual Property in the ordinary course of its business. In furtherance of the foregoing, unless an Event of Default shall have occurred and be continuing, the Collateral Agent shall from time to time, upon the request of a Grantor, execute and deliver any instruments, certificates or other documents, in the form so requested, which such Grantor shall 22 have certified are appropriate (in such Grantor's judgment) to allow it to take any action permitted above (including relinquishment of the license provided pursuant to this clause (c) as to any Intellectual Property). Further, upon the date on which the Discharge of Senior Secured Note Obligations has occurred, the Collateral Agent (subject to Section 11(e) hereof) shall release and reassign to the Grantors all of the Collateral Agent's right, title and interest in and to the Intellectual Property, and the Licenses, all without recourse, representation or warranty whatsoever and at the Grantor's sole expense. The exercise of rights and remedies hereunder by the Collateral Agent shall not terminate the rights of the holders of any licenses or sublicenses heretofore granted by any Grantor or theretofore granted by any Grantor in accordance with the second sentence of this clause (c). Each Grantor hereby releases the Collateral Agent from any claims, causes of action and demands at any time arising out of or with respect to any actions taken or omitted to be taken by the Collateral Agent under the powers of attorney granted herein other than actions taken or omitted to be taken through the Collateral Agent's gross negligence or willful misconduct, as determined by a final determination of a court of competent jurisdiction. (d) If any Grantor fails to perform any agreement contained herein, the Collateral Agent may itself perform, or cause performance of, such agreement or obligation, in the name of such Grantor or the Collateral Agent, and the expenses of the Collateral Agent incurred in connection therewith shall be jointly and severally payable by the Grantors pursuant to Section 8 hereof and shall be secured by the Collateral. (e) The powers conferred on the Collateral Agent hereunder are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except for the safe custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Collateral Agent shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral. (f) Anything herein to the contrary notwithstanding (i) each Grantor shall remain liable under the Licenses and otherwise with respect to any of the Collateral to the extent set forth therein to perform all of its obligations thereunder to the same extent as if this Agreement had not been executed, (ii) the exercise by the Collateral Agent of any of its rights hereunder shall not release any Grantor from any of its obligations under the Licenses or otherwise in respect of the Collateral, and (iii) the Collateral Agent shall not have any obligation or liability by reason of this Agreement under the Licenses or with respect to any of the other Collateral, nor shall the Collateral Agent be obligated to perform any of the obligations or duties of any Grantor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder. SECTION 7. Remedies Upon Default. In each case subject to the Intercreditor Agreement, if any Event of Default shall have occurred and be continuing: (a) The Collateral Agent may exercise in respect of the Collateral, in addition to any other rights and remedies provided for herein or otherwise available to it, all of the rights and remedies of a secured party upon default under the Code (whether or not the Code applies to the affected Collateral), and also may (i) take absolute control of the Collateral, including, 23 without limitation, transfer into the Collateral Agent's name or into the name of its nominee or nominees (to the extent the Collateral Agent has not theretofore done so) and thereafter receive, for the benefit of the Collateral Agent, all payments made thereon, give all consents, waivers and ratifications in respect thereof and otherwise act with respect thereto as though it were the outright owner thereof, (ii) require each Grantor to, and each Grantor hereby agrees that it will at its expense and upon request of the Collateral Agent forthwith, assemble all or part of the Collateral as directed by the Collateral Agent and make it available to the Collateral Agent at a place or places to be designated by the Collateral Agent that is reasonably convenient to both parties, and the Collateral Agent may enter into and occupy any premises owned or leased by any Grantor where the Collateral or any part thereof is located or assembled for a reasonable period in order to effectuate the Collateral Agent's rights and remedies hereunder or under law, without obligation to any Grantor in respect of such occupation, and (iii) without notice except as specified below and without any obligation to prepare or process the Collateral for sale, (A) sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of the Collateral Agent's offices or elsewhere, for cash, on credit or for future delivery, and at such price or prices and upon such other terms as the Collateral Agent may deem commercially reasonable and/or (B) lease, license or dispose of the Collateral or any part thereof upon such terms as the Collateral Agent may deem commercially reasonable. Each Grantor agrees that, to the extent notice of sale or any other disposition of the Collateral shall be required by law, at least ten (10) days' notice to a Grantor of the time and place of any public sale or the time after which any private sale or other disposition of the Collateral is to be made shall constitute reasonable notification. The Collateral Agent shall not be obligated to make any sale or other disposition of Collateral regardless of notice of sale having been given. The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. Each Grantor hereby waives any claims against the Collateral Agent, the Trustee and the Holders arising by reason of the fact that the price at which the Collateral may have been sold at a private sale was less than the price which might have been obtained at a public sale or was less than the aggregate amount of the Senior Secured Note Obligations, even if the Collateral Agent accepts the first offer received and does not offer the Collateral to more than one offeree, and waives all rights that such Grantor may have to require that all or any part of the Collateral be marshalled upon any sale (public or private) thereof. Each Grantor hereby acknowledges that (i) any such sale of the Collateral by the Collateral Agent shall be made without warranty, (ii) the Collateral Agent may specifically disclaim any warranties of title, possession, quiet enjoyment or the like, and (iii) such actions set forth in clauses (i) and (ii) above shall not adversely effect the commercial reasonableness of any such sale of the Collateral. In addition to the foregoing, (i) upon written notice to any Grantor from the Collateral Agent, each Grantor shall cease any use of the Intellectual Property or any trademark, patent or copyright similar thereto for any purpose described in such notice; (ii) the Collateral Agent may, at any time and from time to time, upon ten (10) days' prior notice to any Grantor, license, whether general, special or otherwise, and whether on an exclusive or non-exclusive basis, any of the Intellectual Property, throughout the universe for such term or terms, on such conditions, and in such manner, as the Collateral Agent shall in its sole discretion determine; and (iii) the Collateral Agent may, at any time, pursuant to the authority granted in Section 6 hereof (such authority being effective upon the occurrence and during the continuance of an Event of Default), execute and deliver on behalf of a Grantor, one or more instruments of assignment of 24 the Intellectual Property (or any application or registration thereof), in form suitable for filing, recording or registration in any country. (b) Any cash held by the Collateral Agent as Collateral and all Cash Proceeds received by the Collateral Agent in respect of any sale of or collection from, or other realization upon, all or any part of the Collateral may, in the discretion of the Collateral Agent, be held by the Collateral Agent as collateral for, and/or then or at any time thereafter applied (after payment of any amounts payable to the Collateral Agent pursuant to Section 8 hereof) in whole or in part by the Collateral Agent against, all or any part of the Senior Secured Note Obligations in such order as the Collateral Agent shall elect, consistent with the provisions of the Indenture. Any surplus of such cash or Cash Proceeds held by the Collateral Agent and remaining after the date on which the Discharge of Senior Secured Note Obligations has occurred shall be paid over to whomsoever shall be lawfully entitled to receive the same or as a court of competent jurisdiction shall direct. (c) In the event that the proceeds of any such sale, collection or realization are insufficient to pay all amounts to which the Holders of the Senior Secured Note Obligations are legally entitled, the Grantors shall be jointly and severally liable for the deficiency, together with interest thereon at the highest rate specified in any applicable Senior Secured Note Document for interest on overdue principal thereof or such other rate as shall be fixed by applicable law, together with the reasonable out-of-pocket costs of collection and the reasonable fees, costs, expenses and other client charges of any attorneys employed by the Collateral Agent to collect such deficiency. (d) Each Grantor hereby acknowledges that if the Collateral Agent complies with any applicable state, provincial or federal law requirements in connection with a disposition of the Collateral, such compliance will not adversely affect the commercial reasonableness of any sale or other disposition of the Collateral. (e) The Collateral Agent shall not be required to marshal any present or future collateral security (including, but not limited to, this Agreement and the Collateral) for, or other assurances of payment of, the Senior Secured Note Obligations or any of them or to resort to such collateral security or other assurances of payment in any particular order, and all of the Collateral Agent's rights hereunder and in respect of such collateral security and other assurances of payment shall be cumulative and in addition to all other rights, however existing or arising. To the extent that any Grantor lawfully may, such Grantor hereby agrees that it will not invoke any law relating to the marshalling of collateral which might cause delay in or impede the enforcement of the Collateral Agent's rights under this Agreement or under any other instrument creating or evidencing any of the Senior Secured Note Obligations or under which any of the Senior Secured Note Obligations is outstanding or by which any of the Senior Secured Note Obligations is secured or payment thereof is otherwise assured, and, to the extent that it lawfully may, each Grantor hereby irrevocably waives the benefits of all such laws. SECTION 8. Indemnity and Expenses. (a) Each Grantor jointly and severally agrees to defend, protect, indemnify and hold harmless the Collateral Agent and the Trustee (and all of their respective officers, 25 directors, employees, attorneys, consultants and agents) from and against any and all claims, damages, losses, liabilities, obligations, penalties, fees and reasonable out-of-pocket costs and expenses (including, without limitation, reasonable legal fees, costs, expenses and disbursements of counsel for the Collateral Agent and the Trustee) to the extent that they arise out of or otherwise result from this Agreement (including, without limitation, enforcement of this Agreement), except claims, losses or liabilities resulting solely and directly from such Person's gross negligence or willful misconduct, as determined by a final judgment of a court of competent jurisdiction. (b) Each Grantor jointly and severally agrees to pay to the Collateral Agent upon demand the amount of any and all reasonable out-of-pocket costs and expenses of the Collateral Agent, including the reasonable fees, costs, expenses and disbursements of counsel for the Collateral Agent and of any experts and agents (including, without limitation, any collateral trustee which may act as agent of the Collateral Agent), which the Collateral Agent may incur in connection with (i) the preparation, negotiation, execution, delivery, recordation, administration, amendment, waiver or other modification or termination of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, any Collateral, (iii) the exercise or enforcement of any of the rights of the Collateral Agent hereunder, or (iv) the failure by any Grantor to perform or observe any of the provisions hereof. SECTION 9. Notices, Etc. All notices and other communications provided for hereunder shall be in writing and shall be mailed (by certified mail, postage prepaid and return receipt requested), telecopied or delivered, if to a Grantor, to it in care of the Company at its address specified in the Indenture and if to the Collateral Agent, to it at U.S. Bank National Association, 425 Walnut Street, Cincinnati, Ohio 45202, Fax: (513)-632-5511, Attention: Corporate Trust Office; or as to any such Person, at such other address as shall be designated by such Person in a written notice to such other Person complying as to delivery with the terms of this Section 9. All such notices and other communications shall be effective (a) if mailed (by certified mail, postage prepaid and return receipt requested), when received or three (3) days after deposited in the mails, whichever occurs first, (b) if telecopied, when transmitted and confirmation received or (c) if delivered, upon delivery. SECTION 10. Security Interest Absolute. All rights of the Collateral Agent, the Trustee and the Holders, all Liens and all obligations of each of the Grantors hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Indenture or any other Senior Secured Note Document, (b) any change in the time, manner or place of payment of, or in any other term in respect of, all or any of the Senior Secured Note Obligations, or any other amendment or waiver of or consent to any departure from the Indenture or any other Senior Secured Note Document, (c) any exchange or release of, or non-perfection of any Lien on any Collateral, or any release or amendment or waiver of or consent to departure from any guaranty, for all or any of the Senior Secured Note Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any of the Grantors in respect of the Senior Secured Note Obligations. All authorizations and agencies contained herein with respect to any of the Collateral are irrevocable and powers coupled with an interest. 26 SECTION 11. Miscellaneous. (a) No amendment of any provision of this Agreement (including any Schedule attached hereto) shall be effective unless it is in writing and signed by each Grantor and the Collateral Agent, and no waiver of any provision of this Agreement, and no consent to any departure by any Grantor therefrom, shall be effective unless it is in writing and signed by the Collateral Agent, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. (b) No failure on the part of the Collateral Agent, the Trustee or the Holders to exercise, and no delay in exercising, any right hereunder or under any other Senior Secured Note Document shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. The rights and remedies of the Collateral Agent, the Trustee or the Holders provided herein and in the other Senior Secured Note Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law. The rights of the Collateral Agent, the Trustee or the Holders under any Senior Secured Note Document against any party thereto are not conditional or contingent on any attempt by such Person to exercise any of its rights under any other Senior Secured Note Document against such party or against any other Person, including but not limited to, any Grantor. (c) Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction. (d) This Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the date on which the Discharge of Senior Secured Note Obligations has occurred and (ii) be binding on each Grantor and all other Persons who become bound as debtor to this Agreement in accordance with Section 9-203(d) of the Code and shall inure, together with all rights and remedies of the Collateral Agent, the Trustee or the Holders hereunder, to the benefit of the Collateral Agent, the Trustee or the Holders and their respective permitted successors, transferees and assigns. Upon any such assignment or transfer, all references in this Agreement to any such Collateral Agent, Trustee or Holders shall mean the assignee of Collateral Agent, the Trustee or the Holders. None of the rights or obligations of any Grantor hereunder may be assigned or otherwise transferred without the prior written consent of the Collateral Agent, and any such assignment or transfer shall be null and void. (e) Upon the date on which the Discharge of Senior Secured Note Obligations has occurred, this Agreement and the security interests created hereby shall terminate and all rights to the Collateral shall revert to the Grantors. Notwithstanding the foregoing, the Collateral Agent's Liens upon the Collateral shall automatically be released upon any of the events specified in Section 10.03 of the Indenture in accordance with the terms of the Indenture, and the Collateral of any Grantor that is released from its Note Guarantee obligations and is no longer a Guarantor pursuant to Section 11.05 of the Indenture shall automatically be released upon such an event in accordance with the terms of the Indenture, and such Grantor shall no longer be a party to this Agreement. In connection with any termination or release pursuant to this Section 27 11(e), the Collateral Agent will, upon any Grantor's request and at such Grantor's expense, without any representation, warranty or recourse whatsoever, (i) return to such Grantor such Collateral to be released (in the case of a release) as shall not have been sold or otherwise disposed of or applied pursuant to the terms hereof and (ii) execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such termination or release. (f) THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. (g) ANY LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT RELATED THERETO MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK OR THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS THEREOF, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GRANTOR HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION, SUIT OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. (h) EACH OF THE GRANTORS (AND BY ITS ACCEPTANCE OF THE BENEFITS OF THIS AGREEMENT, THE COLLATERAL AGENT) WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER SENIOR SECURED NOTE DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF THE PARTIES HERETO. (i) Each Grantor irrevocably consents to the service of process of any of the aforesaid courts in any such action, suit or proceeding by the mailing of copies thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such Grantor at its address provided herein, such service to become effective ten (10) days after such mailing. 28 (j) Nothing contained herein shall affect the right of the Collateral Agent to serve process in any other manner permitted by law or commence legal proceedings or otherwise proceed against any Grantor or any property of any Grantor in any other jurisdiction. (k) Each Grantor irrevocably and unconditionally waives any right it may have to claim or recover in any legal action, suit or proceeding referred to in this Section any special, exemplary, punitive or consequential damages. (l) Section headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. (m) This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together constitute one in the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile shall be equally effective as delivery of an original executed counterpart. (n) All of the obligations of the Grantors hereunder are joint and several. The Collateral Agent may, in its sole and absolute discretion, enforce the provisions hereof against any of the Grantors and shall not be required to proceed against all Grantors jointly or seek payment from the Grantors ratably. In addition, the Collateral Agent may, in its sole and absolute discretion, select the Collateral of any one or more of the Grantors for sale or application to the Senior Secured Note Obligations, without regard to the ownership of such Collateral, and shall not be required to make such selection ratably from the Collateral owned by all of the Grantors. The release or discharge of any Grantor by the Collateral Agent shall not release or discharge any other Grantor from the obligations of such Person hereunder. (o) The Collateral Agent acknowledges and agrees, on behalf of itself, the Trustee and the Holders, that, any provision of this Agreement to the contrary notwithstanding, (i) no Grantor shall be required to act or refrain from acting (A) in a manner that is inconsistent with the terms and provisions of the Intercreditor Agreement or (B) with respect to any Credit Facility Priority Collateral in any manner that would result in a default under the terms and provisions of any Credit Facility Document and (ii) any action required to be taken by a Grantor (or omission to act) pursuant to the terms of any Credit Facility Document in respect of Credit Facility Priority Collateral will not put such Grantor in violation of or result in a default under the terms of this Agreement or any other Senior Secured Note Document. (p) Notwithstanding any provision to the contrary contained herein, the terms of this Agreement, the Liens created hereby and the rights and remedies of the Collateral Agent, the Trustee and the Holders hereunder are subject to the terms of the Intercreditor Agreement. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 29 IN WITNESS WHEREOF, each Grantor has caused this Agreement to be executed and delivered by its officer thereunto duly authorized, as of the date first above written. GRANTORS: MILACRON INC. By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Vice President - Finance and Chief Financial Officer EACH GRANTOR LISTED ON SCHEDULE A HERETO By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Treasurer EACH GRANTOR LISTED ON SCHEDULE B HERETO By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Vice President MILACRON INTERNATIONAL MARKETING COMPANY By: /s/ Robert P. Lienesch ---------------------- Name: Robert P. Lienesch Title: Treasurer and Assistant Secretary COLLATERAL AGENT: U.S. BANK NATIONAL ASSOCIATION By: /s/ Karolina K. Dies -------------------- Name: Karolina K. Dies Title: Trust Officer SCHEDULE A Milacron Marketing Company Northern Supply Company, Inc. Nickerson Machinery Chicago Inc. Pliers International, Inc. D-M-E U.S.A. Inc. D-M-E Manufacturing Inc. Uniloy Milacron Inc. Uniloy Milacron U.S.A. Inc. Milacron Industrial Products, Inc. Oak International, Inc. Cimcool Industrial Products Inc. Milacron Plastics Technologies Group Inc. SCHEDULE B Milacron Resin Abrasives Inc. D-M-E Company SECURITY AGREEMENT SCHEDULES SCHEDULE I LEGAL NAMES; STATES OR JURISDICTIONS OF ORGANIZATION; ORGANIZATIONAL IDENTIFICATION NUMBERS
FEDERAL EMPLOYER JURISDICTION OF IDENTIFICATION ORGANIZATIONAL ID COMPANY ORGANIZATION NUMBER NUMBER - -------------------------------------------------------------------------------------------------------------------------------- Milacron Inc. Delaware 31-1062125 2005100 Cimcool Industrial Products Inc. Delaware 31-1681002 3059230 Milacron Plastics Technologies Group Inc. Delaware 31-1681007 3059231 D-M-E Company Delaware 31-1453086 2580409 Milacron Industrial Products, Inc. Michigan 38-3457667 00777A Uniloy Milacron Inc. Delaware 31-1617019 2946694 Uniloy Milacron U.S.A. Inc. Michigan 38-2532631 322-156 Milacron Marketing Company Ohio 31-0240580 147731 D-M-E U.S.A. Inc. Michigan 38-1577946 122-159 D-M-E Manufacturing Inc. Delaware 38-3491394 3097545 Oak International, Inc. Michigan 38-2007743 120-709 Northern Supply Company, Inc. Minnesota 41-1691017 6Y-78 Nickerson Machinery Chicago Inc. Illinois 36-3945434 D5767-658-2 Pliers International Inc. Delaware 04-3137863 2276062 Milacron International Marketing Company Delaware 31-0725217 0637104 Milacron Resin Abrasives Inc. Delaware 31-1315621 2252202
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 1 of 64 TRADEMARKS Owner D-M-E Company (DME)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Argentina DME 1688650 9/18/1998 2127809 4/13/1967 D-M-E Australia AUTO FIXED PROBE B341704 7/19/1984 341704 1/8/1980 D-M-E Australia DME B293730 7/29/1980 293730 1/23/1976 D-M-E Australia DME 338565 5/12/1982 338565 6/7/1978 D-M-E Australia DME 338561 4/27/1982 338561 6/7/1978 D-M-E Australia DME & DESIGN 741988 11/6/1998 741988 8/21/1997 D-M-E Australia FLOW-MATE 743279 5/25/1998 743279 9/8/1997 D-M-E Australia MOLDFUSION 875163 5/9/2001 875163 5/9/2001 D-M-E Austria DME 99128 3/5/1982 AM2997/81 12/4/1981 D-M-E Austria DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Austria GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Austria METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Austria MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Austria MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Austria MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Austria PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Austria STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Benelux AUTO FIXED PROBE 344573 9/22/1977 38587 3/1/1977 D-M-E Benelux DME & DESIGN 39 1/4/1971 500117 1/4/1971 D-M-E Benelux DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Benelux GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Benelux METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Benelux MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Benelux MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Benelux MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Benelux PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Benelux STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Brazil AUTO FIXED PROBE 7175590 3/10/1990 385441 D-M-E Brazil DME 6055435 3/10/1985 30280 10/1/1984 D-M-E Brazil DME 6055427 3/10/1985 30279 10/1/1984 D-M-E Brazil DME & DESIGN 820039888 10/5/1999 820039888 8/27/1997 D-M-E Brazil DME & DESIGN 820039900 8/27/1997 D-M-E Brazil DME & DESIGN 820039896 8/13/2002 820039896 8/27/1997 D-M-E Brazil DME & DESIGN 200025864 8/13/2002 200025864 8/27/1997 D-M-E Brazil FLOW-MATE 820261483 11/23/1999 820261483 9/19/1997 D-M-E Brazil MOLDFUSION 823907260 5/8/2001 D-M-E Canada AUTO FIXED PROBE 245277 5/23/1980 436001 2/19/1979 D-M-E Canada DME & DESIGN 232851 4/17/1979 416993 10/27/1977 D-M-E Canada DME & DESIGN 534116 10/5/2000 854639 8/27/1997 D-M-E Canada FLOW-MATE 533328 9/25/2000 855641 9/8/1997 D-M-E Canada GALAXY 598078 12/18/2003 1109928 7/16/2001 D-M-E Canada METEOR 580375 5/1/2003 1109929 7/16/2001 D-M-E Canada MOLD BASICS 556750 1/23/2002 1050681 3/14/2000 D-M-E Canada MOLDFUSION 637434 5/8/2001 1102382 5/8/2001 D-M-E Canada PLASTICS UNIVERSITY 494012 5/6/1998 825881 10/15/1996 D-M-E Canada PRO WELD 524461 3/8/2000 873732 3/27/1998 D-M-E Canada STELLAR 582535 5/27/2003 1109927 7/16/2001 D-M-E Chile DME 636663 2/16/1982 198913 12/30/1981 D-M-E Denmark DME 869/1966 4/2/1996 250166 2/8/1965 D-M-E Denmark DME & DESIGN 869-1966 4/2/1966 D-M-E Denmark DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 2 of 64 TRADEMARKS Owner D-M-E Company (DME)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Denmark GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Denmark METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Denmark MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Denmark MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Denmark MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Denmark PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Denmark STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E European Community DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E European Community GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E European Community METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E European Community MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E European Community MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E European Community MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E European Community PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E European Community STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Finland DME 93375 5/14/1996 6055/81 12/30/1981 D-M-E Finland DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Finland GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Finland METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Finland MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Finland MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Finland MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Finland PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Finland STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E France DME 1578495 3/1/1980 192649 3/1/1980 D-M-E France DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E France GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E France METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E France MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E France MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E France MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E France PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E France STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Germany AUTO FIXED PROBE 974202 7/31/1978 15450 3/30/1977 D-M-E Germany DME & DESIGN 948480 8/27/1976 13995 5/11/1973 D-M-E Germany DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Germany GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Germany METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Germany MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Germany MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Germany MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Germany PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Germany STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Greece DME 71577 5/2/1983 71577 4/9/1982 D-M-E Greece DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Greece GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Greece METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Greece MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Greece MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Greece MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Greece PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 3 of 64 TRADEMARKS Owner D-M-E Company (DME)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Greece STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Hong Kong DME B29/72 1/12/1972 2790 9/30/1970 D-M-E India DME 580877 9/11/1992 580877 9/11/1992 D-M-E India DME 580879 9/11/1992 D-M-E India DME 580876 9/11/1992 D-M-E India DME 580878 9/11/1992 D-M-E Indonesia DME 385166 9/2/1997 615278 1/9/1981 D-M-E Ireland DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Ireland GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Ireland METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Ireland MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Ireland MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Ireland MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Ireland PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Ireland STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Israel DME 53491 1/1/1987 53491 12/31/1981 D-M-E Italy AUTO FIXED PROBE 793171 10/25/1999 1148/97 4/27/1977 D-M-E Italy DME 427257 3/30/1985 41105-C/84 9/19/1984 D-M-E Italy DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Italy GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Italy METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Italy MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Italy MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Italy MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Italy PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Italy STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Japan AUTO FIXED PROBE 3335392 7/25/1997 40663/95 4/21/1995 D-M-E Japan DME & DESIGN 4412311 8/25/2000 153688/97 8/29/1997 D-M-E Japan DME & DESIGN 4412311 8/25/2000 153688/97 8/29/1997 D-M-E Japan JADME 1120975 5/12/1985 224369/84 12/18/1984 D-M-E Japan MOLD BASICS 4620315 11/15/2002 64409/2001 7/13/2001 D-M-E Korea, Republic of DME 85840 11/23/1982 92-1459 1/4/1982 D-M-E Korea, Republic of DME 85841 11/23/1982 92-1460 1/4/1982 D-M-E Korea, Republic of DME 272737 8/27/1993 92-30592 10/30/1992 D-M-E Korea, Republic of DME 85007 11/2/1982 82-11 1/4/1982 D-M-E Malaysia DME 2115/84 12/7/1989 84/02115 5/4/1984 D-M-E Mexico DME 241594 10/1/1979 10/1/1979 D-M-E Mexico DME & DESIGN 625666 9/29/1999 306040 8/28/1997 D-M-E Mexico DME & DESIGN 619261 8/26/1999 306041 8/28/1997 D-M-E Mexico DME & DESIGN 570147 2/19/1998 306042 8/28/1997 D-M-E Mexico DME & DESIGN 643527 2/25/2000 306043 8/28/1997 D-M-E Mexico FLOW-MATE 565452 11/28/1997 310928 10/15/1997 D-M-E Mexico MOLDFUSION 731308 1/30/2002 484400 5/9/2001 D-M-E Mexico PLASTICS UNIVERSITY 565453 11/28/1997 310929 10/15/1997 D-M-E Mexico PRO WELD 577992 5/28/1998 330340 4/23/1998 D-M-E New Zealand DME B140255 1/6/1983 B140255 1/6/1982 D-M-E New Zealand DME B140256 1/6/1983 B140256 1/6/1982 D-M-E New Zealand DME B140258 1/6/1983 B140258 1/6/1982 D-M-E New Zealand DME B140259 1/6/1983 B140259 1/6/1982 D-M-E New Zealand DME & DESIGN B281267 12/15/1998 281267 8/21/1997 D-M-E New Zealand DME & DESIGN B281266 12/15/1998 281266 8/21/1997 D-M-E
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 4 of 64 TRADEMARKS Owner D-M-E Company (DME)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. New Zealand DME & DESIGN B281265 12/15/1998 281265 8/21/1997 D-M-E New Zealand DME & DESIGN B281264 7/6/1999 281264 8/21/1997 D-M-E New Zealand FLOW-MATE 282085 9/9/1997 282085 9/9/1997 D-M-E New Zealand MOLDFUSION 637434 5/8/2001 637434 5/8/2001 D-M-E Norway DME & DESIGN 123417 12/12/1985 842057 6/14/1984 D-M-E Peru DME 44327 4/30/1987 118150 D-M-E Peru DME 44328 4/30/1987 118150 D-M-E Portugal DME & DESIGN 132202 1/10/1967 132202 9/15/1965 D-M-E Portugal DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Portugal GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Portugal METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Portugal MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Portugal MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Portugal MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Portugal PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Portugal STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Singapore DME 3751/80 8/29/1980 8/29/1980 D-M-E South Africa DME 82/0080 9/14/1984 82/0080 1/6/1982 D-M-E South Africa DME 82/0081 9/14/1984 82/0081 1/6/1982 D-M-E South Africa DME 82/0083 1/14/1984 82/0083 1/6/1982 D-M-E South Africa DME 82/0084 1/14/1984 82/0084 1/6/1982 D-M-E Spain DME 1752842 12/5/1995 1752842 3/26/1993 D-M-E Spain DME 468409 2/18/1966 468409 3/11/1965 D-M-E Spain DME 468410 2/18/1966 468410 3/11/1965 D-M-E Spain DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Spain GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Spain METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Spain MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Spain MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Spain MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Spain PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Spain STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Sweden DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E Sweden GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E Sweden METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E Sweden MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E Sweden MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E Sweden MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E Sweden PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E Sweden STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E Switzerland DME & DESIGN 339120 7/22/1965 1/25/1965 D-M-E Taiwan DME 47864 7/1/1971 31073/59 10/1/1970 D-M-E United Kingdom DME 1122553 4/29/1981 1122553 10/17/1979 D-M-E United Kingdom DME & DESIGN 605162 8/22/1997 605162 8/22/1997 D-M-E United Kingdom GALAXY 2276392 6/27/2001 2276392 6/27/2001 D-M-E United Kingdom METEOR 2276004 6/27/2001 2276004 6/27/2001 D-M-E United Kingdom MOLD BASICS 2304467 6/27/2001 2304467 6/27/2001 D-M-E United Kingdom MOLD BASICS 2658813 4/17/2002 2658813 4/17/2002 D-M-E United Kingdom MOLDFUSION 2208221 5/8/2001 2208221 5/8/2001 D-M-E United Kingdom PLASTICS UNIVERSITY 371153 12/4/1998 371153 11/8/1996 D-M-E United Kingdom STELLAR 2276137 6/27/2001 2276137 6/27/2001 D-M-E
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 5 of 64 TRADEMARKS Owner D-M-E Company (DME)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. United States of America AUTO FIXED 1094237 6/27/1978 73/104475 10/26/1976 D-M-E United States of America COOL ONE 1486791 5/3/1988 73/681520 8/31/1987 D-M-E United States of America CSS 1523368 2/7/1989 738991 7/11/1988 D-M-E United States of America DME 1842659 7/5/1994 74/192065 8/6/1991 D-M-E United States of America DME 1761043 3/30/1993 74/192072 8/6/1991 D-M-E United States of America D-M-E 1217295 11/23/1982 73/254044 3/14/1980 D-M-E United States of America D-M-E 1721367 10/6/1992 74/143455 3/1/1991 D-M-E United States of America DME & DESIGN 812785 8/16/1966 72/216273 4/12/1965 D-M-E United States of America DME & DESIGN 2232773 3/16/1999 75/249338 2/28/1997 D-M-E United States of America DSS 2080550 7/22/1997 74/649533 3/21/1995 D-M-E United States of America FLOW-MATE 2259234 7/6/1999 75/462898 4/6/1998 D-M-E United States of America GALAXY 2443512 4/10/2001 75/852771 11/19/1999 D-M-E United States of America HOT ONE 1443965 6/23/1987 73/623620 10/2/1986 D-M-E United States of America IN2 76/495808 3/10/2003 D-M-E United States of America INTEGRITY 76/489773 2/13/2003 D-M-E United States of America METEOR 2486347 9/4/2001 76/072416 6/5/2000 D-M-E United States of America MFP 1525409 2/21/1989 737250 6/29/1988 D-M-E United States of America MFP 1451556 8/4/1987 73/600078 5/22/1986 D-M-E United States of America MINI-MIGHT 2394775 10/17/2000 75/581193 11/5/1998 D-M-E United States of America MOLD BASICS 2468501 7/10/2001 75/864985 12/6/1999 D-M-E United States of America MOLD SAVER 1223834 1/18/1983 73/341412 12/14/1981 D-M-E United States of America MOLDERBASICS 76/452557 9/25/2002 D-M-E United States of America MOLDFUSION 2648270 11/12/2002 76/162223 11/9/2000 D-M-E United States of America PLASTICS UNIVERSITY 2137820 2/17/1998 75/087787 4/15/1996 D-M-E United States of America QDS 2504707 11/6/2001 76/237215 4/9/2001 D-M-E United States of America SELECTBASE 2738749 7/15/2003 76/379023 3/7/2002 D-M-E United States of America SELECTIVE CYCLE 1625672 12/4/1990 73/738990 7/11/1988 D-M-E Michigan (U.S.A.) SELECTIVE CYCLE M41071 2/9/1990 D-M-E United States of America SELECTIVE CYCLE 1466028 11/17/1987 73/610573 7/22/1986 D-M-E United States of America SMART SERIES 1616459 10/9/1990 73/737240 6/29/1988 D-M-E United States of America SMART SERIES 1466029 11/17/1987 73/610574 7/22/1986 D-M-E United States of America SMART START 1530609 3/21/1989 73/689197 10/8/1987 D-M-E United States of America SSH 1953371 1/30/1996 74/649531 3/21/1995 D-M-E United States of America SSM 1476579 2/16/1988 73/600084 5/22/1986 D-M-E United States of America STELLAR 2632679 10/8/2002 76/072415 6/5/2000 D-M-E United States of America STEP START 1449087 7/21/1987 73/610575 7/22/1986 D-M-E United States of America STRAIGHT SHOT 2591575 7/9/2002 76/336251 11/13/2001 D-M-E United States of America TAS 1953372 1/30/1996 74/649532 3/21/1995 D-M-E United States of America VECTORFORM 76/525022 6/23/2003 D-M-E United States of America VICTORY 76/524043 6/20/2003 D-M-E Venezuela DME 57874 5/11/1970 1250 D-M-E
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 6 of 64 TRADEMARKS Owner D-M-E USA Inc. (DMU)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. ~~United States of America MUD 1585322 3/6/1990 73/812525 7/14/1989 DMU~~
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 7 of 64 TRADEMARKS Owner Milacron Inc. (MI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Algeria MILACRON 48576 1/17/1975 15158 1/17/1975 MI Argentina CIMCOOL 1587126 2/29/1972 865837 10/29/1970 MI Argentina MAGNA 1639441 7/29/1997 2035102 5/29/1996 MI Argentina MILACRON 1644038 9/9/1997 837192 1/14/1970 MI Argentina MILACRON 1459431 7/30/1993 837193 1/14/1970 MI Argentina MILACRON 1421849 10/23/1980 837194 1/14/1970 MI Argentina MILACRON 1421850 10/23/1980 837197 1/14/1970 MI Australia CIMCLEAN A374553 4/22/1982 374553 4/22/1982 MI Australia CIMCOOL A374557 4/22/1982 374557 4/22/1982 MI Australia CIMDRAULIC 1316374 1/29/1985 445030 9/23/1983 MI Australia CIMFLO A374552 4/22/1982 374552 4/22/1982 MI Australia CIMFREE A318179 5/12/1978 318179 5/12/1978 MI Australia CIMGUARD A374554 4/22/1982 374554 4/22/1982 MI Australia CIMGUARDIAN 784007 1/29/1999 784007 1/29/1999 MI Australia CIMPERIAL A374556 12/20/1984 374556 4/22/1982 MI Australia CIMSTAR A505858 5/17/1991 505858 3/2/1989 MI Australia CIMTAP A374550 4/22/1982 374550 4/11/1982 MI Australia CIMTECH A505862 5/17/1991 505862 3/2/1989 MI Australia CORPORATE LOGO DESIGN 724721 12/23/1996 724721 12/23/1996 MI Australia MAGNA 709734 5/31/1996 709734 5/31/1996 MI Australia MILACRON 235554 1/7/1970 235554 1/7/1970 MI Australia MILACRON A235552 1/7/1970 235552 1/7/1970 MI Australia MILACRON A235555 1/7/1970 235555 1/7/1970 MI Australia MILACRON A235556 1/7/1970 235556 1/7/1970 MI Australia QUAL STAR A429795 7/12/1985 429795 7/12/1985 MI Australia SIGMA 701983 5/8/1997 701983 2/6/1996 MI Austria CIMCLEAN 79052 2/7/1975 AM2515/74 10/22/1974 MI Austria CIMFLO 79054 2/7/1975 AM2517/74 10/22/1974 MI Austria CIMGUARD 79055 2/7/1975 AM2518/74 10/22/1974 MI Austria CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Austria CIMPERIAL 43380 12/11/1960 AM 89/60 1/20/1960 MI Austria CIMPLUS 43437 5/18/1960 5/18/1960 MI Austria CIMTAP 79 053 2/7/1975 AM2516/74 10/22/1974 MI Austria CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Austria MAGNA 286658 5/26/1998 286658 7/4/1996 MI Austria MILACRON 68215 1/12/1971 AM1541/70 7/7/1970 MI Austria PROWLER 662734 2/2/1999 662734 10/27/1997 MI Austria QUAL STAR 111380 1/14/1986 AM2146/85 7/10/1985 MI Austria VISTA SENTRY 143139 8/17/1992 AM 1932/92 4/16/1992 MI Bangladesh MILACRON 6107 12/19/1973 6107 12/19/1973 MI Bangladesh MILACRON 6102 12/19/1973 6102 12/19/1973 MI Bangladesh MILACRON 6106 12/19/1973 6105 1/19/1973 MI Bangladesh MILACRON 6106 12/19/1973 6106 12/19/1973 MI Benelux CIMCLEAN 332809 10/23/1974 35033 10/23/1974 MI Benelux CIMCOOL 30360 5/11/1974 3938 5/11/1971 MI Benelux CIMDRAULIC 404479 11/23/1984 52415 11/23/1984 MI Benelux CIMFLO 329114 10/23/1974 35032 10/23/1974 MI Benelux CIMFREE 351376 5/10/1978 624412 5/10/1978 MI Benelux CIMGUARD 30357 5/11/1971 3935 5/11/1971 MI Benelux CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Benelux CIMPERIAL 30361 5/11/1971 3939 5/11/1971 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 8 of 64 TRADEMARKS Owner Milacron Inc. (MI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Benelux CIMPLUS 30362 5/11/1971 3940 5/11/1971 MI Benelux CIMTAP 329115 10/23/1974 35034 10/23/1974 MI Benelux CIMVANTAGE 628924 2/19/1998 910683 2/19/1998 MI Benelux CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Benelux MAGNA 286658 5/26/1998 286658 7/4/1996 MI Benelux MILACRON 30363 5/11/1971 3941 5/11/1971 MI Benelux MSL 384835 10/5/1982 47670 10/5/1982 MI Benelux PROWLER 662734 2/2/1999 662734 10/27/1997 MI Benelux QUAL STAR 412407 7/8/1985 53866 7/8/1985 MI Bolivia MILACRON 24568-C 5/21/1970 3/3/1970 MI Bolivia MILACRON 24567-C 5/21/1970 3/3/1970 MI Bolivia MILACRON 24569-C 5/21/1970 3/3/1970 MI Bolivia MILACRON 24826-C 7/14/1970 4/16/1970 MI Bosnia-Herzegovina MILACRON BAZR96258 3/1/1992 MI Brazil CIMCLEAN 814422016 6/26/1990 814421016 9/1/1988 MI Brazil CIMCOOL 7172842 8/10/1980 942713 11/4/1970 MI Brazil CIMDRAULIC 811815730 9/16/1986 811815730 12/12/1984 MI Brazil CIMFLO 814417086 6/26/1990 814417086 8/29/1988 MI Brazil CIMGUARD 7000375 10/10/1979 4580/M-72 3/29/1972 MI Brazil CIMPERIAL 6954049 7/25/1979 4.579/M-72 3/29/1972 MI Brazil CIMSTAR 815335164 6/26/1990 815335164 1/9/1990 MI Brazil CIMTAP 814609295 9/4/1990 814609295 11/29/1988 MI Brazil CIMTECH 815335164 2/25/1992 815335164 1/9/1990 MI Brazil MAGNA 819381098 3/5/2003 819381098 7/16/1996 MI Brazil MILACRON 6143148 10/10/1985 20556 11/29/1971 MI Brazil MILACRON 6668488 10/25/1978 13609 8/10/1971 MI Brazil MILACRON 6668470 4/25/1978 13608 8/10/1971 MI Brazil MSL 811011860 2/14/1984 811011860 11/10/1982 MI Brazil PROWLER 820348961 12/7/1999 820348961 10/31/1997 MI Brazil VISTA SENTRY 816873321 1/17/1994 816873321 8/26/1992 MI Bulgaria MILACRON 7432 1/22/1970 97 1/22/1970 MI Canada CENTER SAVER 284414 10/28/1983 498165 2/2/1983 MI Canada CIMCLEAN 284413 10/28/1983 498164 2/2/1983 MI Canada CIMCOOL 179568 11/19/1971 337320 10/26/1970 MI Canada CIMCOOL FIVE STAR 283720 9/30/1983 498167 2/2/1983 MI Canada CIMFLO 295003 9/14/1984 498168 2/2/1983 MI Canada CIMFREE 284416 10/28/1983 498169 2/2/1983 MI Canada CIMGUARDIAN 540798 2/5/2001 1003931 2/2/1999 MI Canada CIMPERIAL 283721 9/30/1983 498170 2/2/1983 MI Canada CIMTAP 284415 10/28/1983 498166 2/2/1983 MI Canada CIMVANTAGE 535766 10/25/2000 870006 2/20/1998 MI Canada CORPORATE LOGO DESIGN 518439 10/21/1999 832344 12/23/1996 MI Canada ELEKTRA 500224 8/9/1998 776286 2/22/1995 MI Canada LUBRICANT Q 514556 8/17/1999 860742 11/5/1997 MI Canada MILACRON 190766 5/11/1973 328461 12/10/1969 MI Canada MSL 282997 9/2/1983 495994 12/9/1982 MI Canada QUAL STAR 316730 7/25/1986 545964 7/11/1985 MI Canada VISTA SENTRY 418273 10/15/1993 703785 4/27/1992 MI Chile MILACRON 193046 5/29/1974 4622 1/23/1974 MI Chile MILACRON 591779 11/3/1970 59690-B 2/11/1970 MI China CINCINNATI MILACRON 143946 1/29/1981 5/22/1979 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 9 of 64 TRADEMARKS Owner Milacron Inc. (MI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. China CINCINNATI MILACRON 143944 1/29/1981 5/22/1979 MI China CINCINNATI MILACRON 613443 10/10/1992 91034322 7/23/1991 MI China CORPORATE LOGO DESIGN 1152043 2/21/1998 970013576 2/12/1997 MI China CORPORATE LOGO DESIGN 1150595 2/14/1998 970013577 2/12/1997 MI China CORPORATE LOGO DESIGN 1160968 3/21/1998 970013578 3/3/1997 MI China CORPORATE LOGO DESIGN 1163182 3/28/1998 970013579 3/3/1997 MI China MAGNA 1128978 11/20/1997 960076616 7/1/1996 MI China MILACRON 3416332 12/23/2002 MI China MILACRON 3416361 12/23/2002 MI China MILACRON 3416360 12/23/2002 MI China MILACRON 3416359 12/23/2002 MI China MILACRON (CHINESE) 3416358 12/23/2002 MI China MILACRON (CHINESE) 3416351 12/23/2002 MI China MILACRON (CHINESE) 3416350 12/23/2002 MI China MILACRON (CHINESE) 3416349 12/23/2002 MI China SIGMA 1029169 6/13/1997 960033932 2/26/1996 MI Colombia CIMFLO 128273 3/23/1990 268424 3/27/1987 MI Colombia CIMFLO 142063 7/5/1993 268425 3/27/1987 MI Colombia CIMFLO 142064 7/7/1993 268426 3/27/1987 MI Colombia MILACRON 74675 6/3/1971 120013 2/12/1970 MI Colombia MILACRON 74677 6/3/1971 120013 2/12/1970 MI Colombia MILACRON 74676 6/3/1971 120013 2/12/1970 MI Croatia MILACRON Z920655 3/1/1992 MI Czech Republic MILACRON 159702 12/18/1969 12/18/1969 MI Denmark CIMCLEAN 3248/75 8/22/1975 4352/74 10/9/1974 MI Denmark CIMCOOL 1201/1970 4/3/1970 4299/1969 10/21/1969 MI Denmark CIMFLO 3249/75 8/22/1975 4354/74 10/9/1974 MI Denmark CIMGUARD 1971/75 5/2/1975 4253/74 10/9/1974 MI Denmark CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Denmark CIMPERIAL 2134/76 6/18/1976 4250/74 10/9/1974 MI Denmark CIMPLUS 3524/76 10/29/1976 4351/74 10/9/1974 MI Denmark CIMTAP 3309/76 10/8/1976 4255/74 10/9/1974 MI Denmark CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Denmark MAGNA 286658 5/26/1998 286658 7/4/1996 MI Denmark MILACRON 3267/1970 10/23/1970 53/70 1/6/1970 MI Denmark PROWLER 662734 2/2/1999 662734 10/27/1997 MI Ecuador MILACRON 256/71 2/13/1970 110 2/13/1970 MI Egypt MILACRON 50411 3/20/1975 50411 3/20/1975 MI Egypt MILACRON 50409 3/20/1975 50409 3/20/1975 MI Egypt MILACRON 50413 3/20/1975 50413 3/20/1975 MI Egypt MILACRON 50412 3/20/1975 50412 3/20/1975 MI European Community CIMCLEAN 3465697 10/29/2003 MI European Community CIMCOOL 3465648 10/29/2003 MI European Community CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI European Community CIMPERIAL 3465713 10/29/2003 MI European Community CIMPLUS 3465747 10/29/2003 MI European Community CIMSTAR 3465762 10/29/2003 MI European Community CIMTECH 3465804 10/29/2003 MI European Community CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI European Community MAGNA 286658 5/26/1998 286658 7/4/1996 MI European Community MILFORM 3465812 10/29/2003 MI
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COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. European Community MILPRO 3465581 10/29/2003 MI European Community PROWLER 662734 2/2/1999 662734 10/27/1997 MI Finland CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Finland CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Finland MAGNA 286658 5/26/1998 286658 7/4/1996 MI Finland MILACRON 61593 11/1/1973 63/70 1/8/1970 MI Finland PROWLER 662734 2/2/1999 662734 10/27/1997 MI France CIMCLEAN 1473455 7/23/1968 50481 7/23/1968 MI France CIMCOOL 1313399 1/29/1960 70649 1/29/1960 MI France CIMDRAULIC 1292256 12/11/1984 724303 12/11/1984 MI France CIMFLO 1283991 9/14/1984 180526 10/21/1974 MI France CIMFREE 1464935 6/8/1978 281023 6/8/1978 MI France CIMGUARD 1473460 6/27/1988 50464 7/23/1968 MI France CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI France CIMPERIAL 1309590 1/29/1960 70650 1/29/1960 MI France CIMPLUS 1309589 12/16/1960 70651 1/29/1960 MI France CIMTAP 1473459 6/27/1968 50491 7/23/1968 MI France CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI France ELEKTRA 96/561.221 3/3/1995 95/561221 3/3/1995 MI France MAGNA 286658 5/26/1998 286658 7/4/1996 MI France MILACRON 1559051 11/9/1970 91276 1/5/1970 MI France MSL 1217286 10/29/1982 643985 10/29/1982 MI France PROWLER 662734 2/2/1999 662734 10/27/1997 MI France QUAL STAR 1320493 8/20/1985 755900 8/20/1985 MI France VISTA SENTRY 92/419.067 5/15/1992 92419067 5/15/1992 MI Germany CIMCLEAN 936611 10/16/1975 C24448/1WZ 11/25/1974 MI Germany CIMCOOL 695994 10/13/1956 C 4942/6WZ 8/31/1954 MI Germany CIMDRAULIC 1081058 11/25/1984 C33642/2WZ 11/20/1984 MI Germany CIMFLO 934911 9/24/1975 C24357/4WZ 9/24/1974 MI Germany CIMGUARD 935642 11/25/1975 C24446/2WZ 11/25/1974 MI Germany CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Germany CIMPERIAL 743157 3/7/1960 C9803/6WZ 3/7/1960 MI Germany CIMPLUS 820920 3/7/1960 C9802/6WZ 3/7/1960 MI Germany CIMTAP 937476 11/25/1975 C24447/WZ 11/25/1974 MI Germany COMPETENCE IN EXTRUSION (CL) MI Germany CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Germany CPM 39652238 4/7/1997 39652238.6 11/30/1996 MI Germany ELEKTRA 39508743 12/20/1995 39508743 2/27/1995 MI Germany MAGNA 286658 5/26/1998 286658 7/4/1996 MI Germany MILACRON 952364 2/8/1970 C20353/1WZ 1/8/1970 MI Germany POWERUNIT (CL) MI Germany PROCUT (CL) MI Germany PROWLER 662734 2/2/1999 662734 10/27/1997 MI Germany QUAL STAR 1103002 3/2/1987 C34317/1WZ 7/8/1985 MI Germany TWINPOWER (CL) MI Germany VISTA SENTRY 2033550 3/29/1993 C43419/7WZ 4/16/1992 MI Ghana MILACRON 19734 2/14/1976 19734 2/14/1975 MI Ghana MILACRON 19731 4/20/1976 19731 2/14/1975 MI Ghana MILACRON 19733 2/14/1975 19733 2/14/1975 MI Greece CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI
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COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Greece CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Greece MAGNA 286658 5/26/1998 286658 7/4/1996 MI Greece MILACRON 43431 2/2/1970 43431 2/2/1970 MI Greece PROWLER 662734 2/2/1999 662734 10/27/1997 MI Hungary MILACRON 122009 7/15/1970 112892 7/15/1970 MI India CENTER SAVER 629244 5/30/1994 MI India CIMCLEAN 629238 5/30/1994 MI India CIMCOOL 629239 5/30/1995 MI India CIMDRAULIC 430221 11/26/1984 430221 11/26/1984 MI India CIMFLO 629230 5/30/1994 MI India CIMFREE 629234 5/30/1994 MI India CIMGUARD 629237 5/30/1994 MI India CIMPERIAL 629240 5/30/1994 MI India CIMPLUS 629235 5/30/1994 MI India CIMSTAR 629246 5/30/1994 MI India CIMTAP 629243 5/30/1994 MI India CIMTECH 629242 5/30/1994 MI India CORPORATE LOGO DESIGN 753458 1/22/1997 MI India CORPORATE LOGO DESIGN 753459 12/5/2003 753459 1/22/1997 MI India CORPORATE LOGO DESIGN 753460 1/22/1997 MI India CORPORATE LOGO DESIGN 753461 1/22/1997 MI India ELEKTRA 656437 2/22/1995 MI India LUBRICANT Q 778953 11/19/1997 MI India MAGNA 783603 12/26/1997 MI India MILACRON 261265 12/15/1969 261265 12/15/1969 MI India MILACRON 261267 12/15/1969 261267 12/15/1969 MI India MILACRON 261268 12/15/1969 261268 12/15/1969 MI India MILACRON 261269 12/15/1969 261269 12/15/1969 MI India MILCOOL 629241 5/30/1994 MI India MILHONE 629247 5/30/1994 MI India MILPLUS 629232 5/30/1994 MI India MILPRO 629233 5/30/1995 MI India MILQUENCH 629231 5/30/1994 MI India QUAL STAR 440040 7/10/1985 440040 7/10/1985 MI India SIGMA 697633 2/8/1996 MI Indonesia MILACRON 416631 7/12/1998 15257/87 10/8/1987 MI Iran MILACRON 47047 4/20/1977 68923 4/20/1977 MI Ireland CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Ireland CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Ireland MAGNA 286658 5/26/1998 286658 7/4/1996 MI Ireland MILACRON 76210 1/9/1970 37/70 1/9/1970 MI Ireland MILACRON 76212 1/9/1970 39/70 1/9/1970 MI Ireland MILACRON 76213 1/9/1970 40/70 1/9/1970 MI Ireland MILACRON 76214 1/9/1970 41/70 1/9/1970 MI Ireland PROWLER 662734 2/2/1999 662734 10/27/1997 MI Israel MILACRON 31237 12/16/1969 31237 12/16/1969 MI Israel MILACRON 31239 12/16/1969 31239 12/16/1969 MI Israel MILACRON 31240 12/16/1969 31240 12/16/1969 MI Israel MILACRON 31241 12/16/1969 31241 12/16/1969 MI Italy CIMCLEAN 683760 7/4/1996 40861-C/74 10/18/1974 MI Italy CIMCOOL 689393 8/30/1954 35/232 8/30/1954 MI
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COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Italy CIMDRAULIC 683761 7/4/1996 41550-C/84 5/2/1986 MI Italy CIMFLO 683762 7/4/1996 40862-C/74 10/18/1974 MI Italy CIMFREE 380610 6/15/1985 40442-C/78 6/15/1978 MI Italy CIMGUARD 683763 7/4/1996 40888-C/74 10/25/1974 MI Italy CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Italy CIMPERIAL 391218 1/25/1960 52/229 1/25/1960 MI Italy CIMPLUS 391219 1/25/1960 52/230 1/25/1960 MI Italy CIMTAP 683765 10/18/1996 40863-C/64 10/18/1974 MI Italy CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Italy MAGNA 286658 5/26/1998 286658 7/4/1996 MI Italy MILACRON 576283 1/5/1970 91276 1/5/1970 MI Italy MSL 403646 10/19/1986 40989-C/82 10/19/1982 MI Italy PROWLER 662734 2/2/1999 662734 10/27/1997 MI Italy QUAL STAR 717094 7/6/1997 41029-C/85 8/29/1985 MI Italy VISTA SENTRY 635131 11/23/1994 92C001101 5/26/1992 MI Japan CIMCLEAN 1669892 3/22/1984 33028/1973 2/22/1973 MI Japan CIMCOOL 1056205 2/14/1974 113249/70 10/28/1970 MI Japan CIMDRAULIC 1953738 9/3/1986 131830/84 12/21/1984 MI Japan CIMFLO 1731150 11/27/1984 33025/1973 2/22/1973 MI Japan CIMFREE 1774208 5/30/1985 35956/1978 5/12/1978 MI Japan CIMGUARD 1314703 12/2/1977 33022/1973 2/22/1973 MI Japan CIMGUARDIAN 7078/1999 1/28/1999 MI Japan CIMPERIAL 2101572 12/19/1988 93994/1986 9/4/1986 MI Japan CIMPLUS 2259969 9/30/1990 93993/1986 9/4/1986 MI Japan CIMTAP 1760421 4/23/1985 33023/1973 2/22/1973 MI Japan CORPORATE LOGO DESIGN 4162616 7/3/1998 10371/1997 3/3/1997 MI Japan CORPORATE LOGO DESIGN 4162617 7/3/1998 10372/1997 3/3/1997 MI Japan CORPORATE LOGO DESIGN 4153423 6/5/1998 10373/1997 3/3/1997 MI Japan CORPORATE LOGO DESIGN 4239557 2/12/1999 10374/1997 3/3/1997 MI Japan ELEKTRA 4734733 12/19/2003 68396/1995 7/6/1995 MI Japan MILACRON 2301718 2/27/1991 57-011287 2/15/1982 MI Japan MILACRON 1416271 1/30/1980 2301/1970 1/7/1970 MI Japan MILACRON 1591160 5/27/2003 86080/78 11/28/1978 MI Japan MILACRON (KATAKANA) 2301719 2/27/1991 57-011288 2/15/1982 MI Japan MIRACLON (KATAKANA) 628957 12/16/1993 S37-035473 11/1/1962 MI Japan MSL 1805650 9/27/1985 88384/1982 10/6/1982 MI Japan QUAL STAR 2027888 2/22/1988 73397/1985 7/16/1985 MI Japan SHIMITOP 691407 12/2/1965 5110/1964 2/11/1964 MI Japan VISTA 2697975 10/31/1994 38886/89 4/4/1989 MI Japan VISTA SENTRY 3017357 12/22/1994 014980/92 4/17/1992 MI Korea, Republic of CIMCLEAN 187580 1/24/1990 88-18616 8/20/1988 MI Korea, Republic of CIMCOOL 187581 1/24/1990 88-18617 8/20/1988 MI Korea, Republic of CIMDRAULIC 127107 7/9/1986 84-17532 11/24/1984 MI Korea, Republic of CIMFLO 181275 10/16/1989 88-18616 8/20/1988 MI Korea, Republic of CIMGUARD 195581 7/5/1990 89-5404 3/8/1989 MI Korea, Republic of CIMGUARDIAN 466916 3/20/2000 99-5287 2/23/1999 MI Korea, Republic of CIMPERIAL 181277 10/16/1989 88-18618 8/20/1988 MI Korea, Republic of CIMSTAR 187582 1/24/1990 99-18619 8/20/1988 MI Korea, Republic of CIMTAP 181276 10/16/1989 88-18615 8/20/1988 MI Korea, Republic of CIMTECH 194446 6/21/1990 88-21113 9/20/1988 MI Korea, Republic of MILACRON 82855 7/12/1982 10099/1981 11/13/1981 MI
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COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Korea, Republic of MILACRON 19671 6/23/1970 982/1970 3/12/1970 MI Korea, Republic of MILACRON 19632 6/20/1970 983/1970 3/12/1970 MI Korea, Republic of MILCOOL 313113 5/11/1995 94-10083 3/14/1994 MI Korea, Republic of MILHONE 313115 5/11/1995 94-10081 3/14/1994 MI Korea, Republic of MILPLUS 313968 5/23/1995 94-10080 3/14/1994 MI Korea, Republic of MILPRO 313112 5/11/1995 94-10084 3/14/1994 MI Korea, Republic of MILQUENCH 313114 5/11/1995 94-10082 3/14/1994 MI Korea, Republic of MSL 300350 10/10/1994 93-25067 7/19/1993 MI Luxembourg CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Macedonia MILACRON 3963 3/2/1992 MI Malaysia SIGMA MA/2790/96 3/20/1996 MI Mexico CIMCLEAN 508022 10/10/1995 243564 9/21/1995 MI Mexico CIMCOOL 325085 11/26/1985 2498 11/26/1985 MI Mexico CIMGUARD 496992 8/18/1989 188822 3/29/1982 MI Mexico CIMGUARDIAN 605815 4/9/1999 366636 3/9/1999 MI Mexico CIMPERIAL 362559 5/19/1989 50046 10/7/1988 MI Mexico CIMSTAR 642470 2/23/2000 366642 3/9/1999 MI Mexico CIMTECH 642469 2/23/2000 366641 3/9/1999 MI Mexico LUBRICANT Q 565901 10/28/1997 312379 10/28/1997 MI Mexico MAGNA 539845 1/27/1997 267418 7/5/1996 MI Mexico MILACRON 405538 6/28/1991 117160 6/28/1991 MI Mexico MILACRON 405537 6/28/1991 117159 6/28/1991 MI Mexico MILACRON 405536 6/28/1991 117155 6/28/1991 MI Mexico MILFORM 607523 4/28/1999 366639 3/9/1999 MI Mexico PROWLER 569316 1/30/1998 313168 11/5/1997 MI Mexico QUAL STAR 320263 12/5/1986 252881 8/9/1985 MI Mexico VISTA SENTRY 462981 6/10/1994 141699 6/10/1992 MI New Zealand MAGNA 262765 1/16/1996 262765 5/28/1996 MI New Zealand MILACRON 92230 12/12/1969 92230 12/12/1969 MI New Zealand MILACRON 92232 12/12/1969 92232 12/12/1969 MI New Zealand MILACRON 92233 12/12/1969 92233 12/12/1969 MI New Zealand MILACRON 92234 12/12/1969 92234 12/12/1969 MI Nigeria MILACRON 25475 4/29/1975 25475/75 4/29/1975 MI Nigeria MILACRON 25474 4/29/1975 25474/75 4/29/1975 MI Nigeria MILACRON 25460 4/29/1975 25460/75 4/29/1975 MI Nigeria MILACRON 25458 4/29/1975 25458/75 4/29/1975 MI Norway CIMCOOL 56629 1/20/1960 68809 1/20/1960 MI Norway CIMPERIAL 55341 1/20/1960 68807 1/20/1960 MI Norway CIMPLUS 55340 1/20/1960 68808 1/20/1960 MI Norway MILACRON 83836 2/3/1972 102184 1/7/1970 MI Norway MSL 122065 8/29/1985 84.1704 5/16/1984 MI Norway QUAL STAR 128357 4/9/1987 85.2546 7/8/1985 MI Pakistan MILACRON 52744 12/23/1969 12/23/1969 MI Pakistan MILACRON 52741 12/23/1969 12/23/1969 MI Pakistan MILACRON 52743 12/23/1969 12/23/1969 MI Pakistan MILACRON 52742 12/23/1969 12/23/1969 MI Paraguay MILACRON 223526 5/12/1970 228 2/4/1970 MI Paraguay MILACRON 223529 5/12/1970 229 2/4/1970 MI Paraguay MILACRON 223527 5/12/1970 230 2/4/1970 MI Paraguay MILACRON 223528 5/12/1970 231 2/4/1970 MI Peru MILACRON 33965 2/6/1970 761 2/6/1970 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 14 of 64 TRADEMARKS Owner Milacron Inc. (MI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Peru MILACRON 33693 2/6/1970 765 2/6/1970 MI Peru MILACRON 34373 2/6/1970 764 2/6/1970 MI Philippines MILACRON 21518 3/12/1974 20282 3/19/1971 MI Poland MILACRON 51590 7/27/1970 Z.69504 7/27/1970 MI Portugal CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Portugal CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Portugal MAGNA 286658 5/26/1998 286658 7/4/1996 MI Portugal MILACRON 164499 11/7/1972 164499 9/4/1970 MI Portugal MILACRON 164501 4/21/1976 164501 9/4/1970 MI Portugal MILACRON 164502 11/17/1972 164502 9/4/1970 MI Portugal MILACRON 164503 11/17/1972 164503 9/4/1970 MI Portugal PROWLER 662734 2/2/1999 662734 10/27/1997 MI Romania MILACRON 3R6829 2/18/1970 2/18/1970 MI Russian Federation MILACRON 138719 2/28/1996 94027606 8/4/1994 MI Serbia and Montenegro MILACRON 19386 3/1/1972 Z.44/70 1/23/1970 MI Slovakia MILACRON 159702 12/18/1989 MI Slovenia MILACRON 7080044 3/31/1994 304-67/92 11/2/1992 MI South Africa MILACRON 2939/70 7/1/1970 70/2939 7/1/1970 MI South Africa MILACRON 2941/70 7/1/1970 70/2941 7/1/1970 MI South Africa MILACRON 2943/70 7/1/1970 70/2943 7/1/1970 MI South Africa MILACRON 2942/70 7/1/1970 70/2942 7/1/1970 MI Spain CIMCOOL 600418 4/20/1974 600418 10/24/1969 MI Spain CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Spain CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Spain MAGNA 286658 5/26/1998 286658 7/4/1996 MI Spain MILACRON 606265 5/24/1976 606265 1/12/1970 MI Spain MILACRON 606267 3/1/1976 606267 1/12/1970 MI Spain MILACRON 606269 1/16/1972 606269 1/12/1970 MI Spain MILACRON 606268 4/16/1974 606268 1/12/1970 MI Spain PROWLER 662734 2/2/1999 662734 10/27/1997 MI Sweden CIMCLEAN 151054 4/11/1975 4746/74 10/15/1974 MI Sweden CIMCOOL 76991 11/12/1954 2350/54 8/30/1954 MI Sweden CIMDRAULIC 195873 4/19/1985 8408486 11/21/1984 MI Sweden CIMFLO 150328 2/7/1975 4747 10/15/1974 MI Sweden CIMGUARD 150403 2/14/1975 4748 10/15/1974 MI Sweden CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI Sweden CIMPERIAL 100178 5/12/1961 188/60 1/19/1960 MI Sweden CIMPLUS 90716 11/11/1960 189/60 1/19/1960 MI Sweden CIMTAP 156412 8/13/1976 4745/74 10/15/1974 MI Sweden CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI Sweden MAGNA 286658 5/26/1998 286658 7/4/1996 MI Sweden MILACRON 142267 3/9/1973 43/70 1/8/1970 MI Sweden PROWLER 662734 2/2/1999 662734 10/27/1997 MI Switzerland CIMCLEAN 408936 3/5/1975 CM 1/74/M 10/21/1974 MI Switzerland CIMCOOL 272701 8/31/1954 3213 8/31/1954 MI Switzerland CIMDRAULIC 335990 11/22/1985 6317 11/22/1984 MI Switzerland CIMFLO 408934 3/29/1975 5262 10/21/1974 MI Switzerland CIMFREE 294449 5/18/1978 2265 5/18/1978 MI Switzerland CIMGUARD 408937 3/5/1975 5265 10/21/1974 MI Switzerland CIMGUARDIAN 473325 7/11/2000 00634/1999 1/26/1999 MI Switzerland CIMPERIAL 303679 2/3/1960 2/3/1960 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 15 of 64 TRADEMARKS Owner Milacron Inc. (MI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Switzerland CIMPLUS 303680 2/3/1960 2/3/1960 MI Switzerland CIMSTAR 518700 12/29/2003 55463/2003 10/29/2003 MI Switzerland CIMTAP 408935 3/5/1975 5263 10/21/1974 MI Switzerland CIMTECH 55461/2003 10/29/2003 MI Switzerland MILACRON 379437 2/4/1970 665 2/4/1970 MI Switzerland MILFORM 55465/2003 10/29/2003 MI Switzerland MILPRO 55464/2003 10/29/2003 MI Switzerland QUAL STAR 340355 7/10/1985 4343 7/10/1985 MI Syria MILACRON 20776 2/16/1975 24113 1/16/1975 MI Taiwan CIMDRAULIC 755027 3/31/1997 84-049299 10/2/1995 MI Taiwan MILACRON 54324 11/1/1972 3/27/1970 MI Taiwan MILACRON 44326 12/1/1970 3/27/1970 MI Taiwan MILACRON 44377 12/1/1970 3/27/1970 MI Taiwan MILACRON 45156 2/1/1971 3/27/1970 MI Taiwan MILACRON 44845 1/1/1971 3/27/1970 MI Taiwan MSL 214793 7/1/1983 71-036499 10/10/1982 MI Taiwan VISTA SENTRY 589475 3/1/1993 81-018689 4/21/1992 MI Thailand MILACRON 14655 6/12/1991 215440 6/12/1991 MI Thailand MILACRON 156530 6/12/1991 215442 6/12/1991 MI Thailand MILACRON 147680 2/3/1992 215441 6/12/1991 MI Tunisia MILACRON 900003 1/4/1975 1/4/1975 MI Turkey CIMCOOL 92405 5/29/1986 33776/86 5/29/1986 MI Turkey CIMCOOL FIVE STAR 92559 5/29/1986 33765/86 5/29/1986 MI Turkey CIMPERIAL 92763 5/29/1986 33775/86 5/29/1986 MI Turkey CIMPLUS 92749 5/29/1986 33774/86 5/29/1986 MI Turkey MILACRON 120553 1/24/1970 3752/70 1/24/1970 MI United Kingdom CIMCLEAN 1036750 10/15/1974 1036750 10/16/1974 MI United Kingdom CIMCOOL 649227 6/27/1946 649227 6/27/1946 MI United Kingdom CIMDRAULIC 1230801 11/26/1984 1230801 11/23/1984 MI United Kingdom CIMFLO 1036752 1/9/1976 1036752 10/1/1975 MI United Kingdom CIMGUARD 1036751 10/16/1974 1036571 10/16/1974 MI United Kingdom CIMGUARDIAN 1056159 5/25/2000 1056159 1/27/1999 MI United Kingdom CIMPERIAL 800658 1/22/1960 800658 1/22/1960 MI United Kingdom CIMPLUS 800659 1/22/1960 800659 1/22/1960 MI United Kingdom CIMTAP 1036753 10/16/1974 1036753 10/16/1974 MI United Kingdom CORPORATE LOGO DESIGN 422691 2/24/1999 422691 1/3/1997 MI United Kingdom ELEKTRA 2012056 2/23/1995 2012056 2/23/1995 MI United Kingdom MAGNA 286658 5/26/1998 286658 7/4/1996 MI United Kingdom MILACRON 952664 12/18/1969 952664 12/18/1969 MI United Kingdom MILACRON 952660 12/18/1969 952660 12/18/1969 MI United Kingdom MILACRON 952662 12/18/1969 952662 12/18/1969 MI United Kingdom MILACRON 952661 12/18/1969 952661 12/18/1969 MI United Kingdom PROWLER 662734 2/2/1999 662734 10/27/1997 MI United Kingdom QUAL STAR 1246085 7/12/1985 1246085 7/12/1985 MI United States of America CIMBORD 807489 4/26/1966 72/222661 7/6/1965 MI United States of America CINCINNATI MILACRON 1100008 8/22/1978 73/78633 2/27/1976 MI United States of America CORPORATE LOGO DESIGN 2124420 12/23/1997 75/163070 7/3/1996 MI United States of America E-PET AND DESIGN 2665360 12/24/2002 76/162222 11/9/2000 MI United States of America FIND A BETTER WAY 1956188 2/13/1996 74/642445 3/6/1995 MI United States of America INDIGO (CL) MI United States of America MILACRON 894004 7/7/1970 72/342139 10/30/1969 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 16 of 64 TRADEMARKS Owner Milacron Inc. (MI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. United States of America MILACRON 905990 1/12/1971 72/346725 12/19/1969 MI United States of America MILACRON 893967 7/7/1970 72/342138 10/30/1969 MI United States of America MILACRON 894092 7/7/1970 72/342141 10/30/1969 MI United States of America MILACRON 910416 3/23/1971 72/346723 12/19/1969 MI United States of America XTREEM 76/004391 3/20/2000 MI Uruguay MILACRON 295560 7/24/1987 13173 2/9/1971 MI Uruguay MILACRON 340865 12/24/1981 131729 2/9/1971 MI Uruguay MILACRON 300860 8/24/1998 131731 2/9/1971 MI Uruguay MILACRON 171119 4/23/1982 131732 2/9/1971 MI Venezuela CIMFLO 140065 1/7/1991 03196/87 7/6/1965 MI Venezuela CIMFLO 140075 1/7/1991 03288/87 3/18/1987 MI Venezuela MILACRON 63692 1/26/1971 8819 12/15/1969 MI Venezuela MILACRON 82369 8/6/1976 10703 12/16/1974 MI Venezuela MILACRON 64405 4/5/1971 8815 12/15/1969 MI Venezuela MILACRON 101154 1/10/1983 8816 12/15/1969 MI Zimbabwe MILACRON 1238/69 12/18/1969 1238/69 12/18/1969 MI Zimbabwe MILACRON 1239/69 12/18/1976 1239/69 12/18/1969 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 17 of 64 TRADEMARKS Owner Milacron Industrial Products Inc. (MIP)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. United States of America CENTER SAVER 1020913 9/23/1975 73/017031 3/25/1974 MIP United States of America CIMCHEK 2332117 3/21/2000 75/655815 3/8/1999 MIP United States of America CIMCLEAN 810254 6/21/1966 72/222662 7/6/1965 MIP United States of America CIMCOOL 904116 12/15/1970 72/340368 10/10/1969 MIP United States of America CIMCOOL 415093 7/10/1945 71/478857 1/22/1945 MIP United States of America CIMCOOL FIVE STAR 782291 12/29/1964 72/193630 5/18/1964 MIP United States of America CIMDRAULIC 1316374 1/29/1985 73/445030 9/23/1983 MIP United States of America CIMFLO 813829 8/30/1966 72/222663 7/6/1965 MIP United States of America CIMFREE 1087532 3/21/1978 73/123604 4/21/1977 MIP United States of America CIMGUARD 757107 9/24/1963 72/148142 7/2/1962 MIP United States of America CIMGUARDIAN 2240619 4/20/1999 75/437905 2/20/1998 MIP United States of America CIMPERIAL 689369 12/8/1959 72/064260 12/15/1958 MIP United States of America CIMPLUS 699277 6/14/1960 72/084290 10/30/1959 MIP United States of America CIMSTAR 1580883 2/6/1990 73/705452 1/13/1988 MIP United States of America CIMTAP 986779 6/25/1974 72/449401 3/16/1973 MIP United States of America CIMTECH 1526347 2/28/1989 73/745479 8/11/1988 MIP United States of America CIMVANTAGE 2225318 2/23/1999 75/348230 8/28/1997 MIP United States of America DROP DESIGN 78/323507 11/5/2003 MIP United States of America JOB SHOP MALL 2466951 7/10/2001 75/625095 1/22/1999 MIP United States of America MACHINERY FLEA MARKET 2508437 11/20/2001 75/625094 1/22/1999 MIP United States of America MILCOOL 1892897 5/9/1995 74/488956 2/14/1994 MIP United States of America MILDRAW 2436916 3/20/2001 75/931854 2/28/2000 MIP United States of America MILFORM 2366656 7/11/2000 75/309375 6/16/1997 MIP United States of America MILHONE 1892896 5/9/1995 74/488955 2/14/1994 MIP United States of America MILPLUS 1883270 3/14/1995 74/488957 2/14/1994 MIP United States of America MILPRO 1892895 5/9/1995 74/488954 2/14/1994 MIP United States of America MILPRO 2364181 7/4/2000 75/655816 3/8/1999 MIP United States of America MILQUENCH 1884541 3/21/1995 74/488958 2/14/1994 MIP United States of America MSL 1246144 7/26/1983 73/350068 2/12/1982 MIP United States of America QUAL STAR 1338651 6/4/1985 73/510746 11/26/1984 MIP United States of America QUANTALUBE 2359901 6/20/2000 75/697465 5/3/1999 MIP United States of America SDF (CL) MIP
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 18 of 64 TRADEMARKS Owner Nickerson Machinery Chicago Inc. (NMI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. United States of America NICKERSON 1317649 2/5/1985 73/446397 10/3/1983 NMI United States of America NM 1313162 1/8/1985 73/446177 10/3/1983 NMI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 19 of 64 TRADEMARKS Owner Oak International Inc. (OI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. United States of America OAK 2794926 12/16/2003 78/206249 1/23/2003 OI United States of America OAK SIGNATURE 2736354 7/15/2003 76/439574 8/12/2002 OI United States of America OAKFLO 2700266 3/25/2003 76/439556 8/12/2002 OI United States of America OAKFORM 2700264 3/25/2003 76/439552 8/12/2002 OI United States of America OAKSPEC 2736353 7/15/2003 76/439555 8/12/2002 OI United States of America OAKTEC 2700265 3/25/2003 76/439553 8/12/2002 OI United States of America OAKWASH 2704570 4/8/2003 76/439554 8/12/2002 OI United States of America OILRID 1877634 2/7/1995 74/494457 2/25/1994 OI United States of America TMFM 2067577 6/3/1997 74/613236 12/21/1994 OI United States of America TOTAL METALWORKING FLUID OI MANAGEMENT
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 20 of 64 TRADEMARKS Owner Uniloy Milacron Inc. (UMI)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Australia UNILOY 317946 5/5/1978 UMI Australia UNILOY 318712 5/30/1978 UMI Benelux UNILOY 468861 6/16/1990 733046 8/16/1989 UMI Brazil UNILOY 818228563 10/8/1996 UMI Canada UNILOY 374283 10/12/1990 63827300 8/14/1989 UMI France UNILOY 1547923 8/23/1989 150839 8/23/1989 UMI Germany UNILOY 893051 5/3/1972 341707WZ 3/20/1970 UMI Ireland UNILOY 133826 8/18/1989 UMI Italy UNILOY 581853 11/27/1992 1744590 2/7/1990 UMI Italy UNILOY 559332 2/3/1992 23726C/89 8/25/1989 UMI Japan UNILOY 2409024 4/30/1992 H01-094011 8/18/1989 UMI Mexico UNILOY 72405 9/27/1989 UMI New Zealand UNILOY 124080 6/14/1979 UMI United Kingdom UNILOY 954873 3/20/1972 954873 2/10/1970 UMI United Kingdom UNILOY 956076 3/3/1970 956076 3/3/1970 UMI United States of America COMEC (CL) UMI United States of America INDU TECHNO SPOL (CL) UMI United States of America MORETTI (CL) UMI United States of America MS (CL) UMI United States of America PLASTIC USA (CL) UMI United States of America RECIP (CL) UMI United States of America RECIP 2000 (CL) UMI United States of America SPRINGFIELD (CL) UMI United States of America UNILOY 845868 3/12/1968 72/164214 2/8/1967 UMI United States of America VERSAPET 2626003 9/24/2002 76/051552 5/18/2000 UMI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 21 of 64 TRADEMARKS Owner Uniloy Milacron USA Inc. (UMU)
COUNTRY TRADEMARK REGISTRATION REGISTRATION APPLICATION DATE FILED OWNER NO. DATE NO. Brazil AUTOJECTORS 819991945 7/28/1997 UMU Canada AUTOJECTORS 514493 8/16/1997 849954 7/7/1997 UMU Canada AUTOJECTORS 510745 4/13/1999 809257 9/4/1996 UMU Germany AUTOJECTORS 39732196.1 6/22/1998 39732196.1 7/10/1997 UMU India AUTOJECTORS 7/8/1997 UMU Mexico AUTOJECTORS 558984 9/25/1997 302940 7/31/1997 UMU United States of America ACS (CL) UMU United States of America AJ (CL) UMU United States of America ALLIANCE 2250287 6/1/1999 75/308404 6/13/1997 UMU United States of America APEX (CL) UMU United States of America ATLAS (CL) UMU United States of America AUTOBLOW 1318925 2/12/1985 73/446620 10/5/1983 UMU United States of America AUTOJECTORS 2104613 10/14/1997 75/003199 10/10/1995 UMU United States of America AUTOJECTORS 2172497 7/14/1998 75/233729 1/30/1997 UMU United States of America BA SERIES (CL) UMU United States of America CYCLONE (CL) UMU United States of America ECLIPSE (CL) UMU United States of America ELEKTRA 1912253 8/15/1995 501735 3/18/1994 UMU United States of America EVOLUTION 2559906 4/9/2002 75/940796 3/9/2000 UMU United States of America EXTRUSIONTEK MILACRON 75/883769 12/28/1999 UMU United States of America HC SERIES (CL) UMU United States of America IMACS (CL) UMU United States of America MAGNA 2075199 7/1/1997 75/044405 1/16/1996 UMU United States of America MASTERCRIMP (CL) UMU United States of America MAXIMA (CL) UMU United States of America MELTSTAR (CL) UMU United States of America MOBIUS DESIGN 1497424 7/26/1988 641035 1/23/1987 UMU United States of America PAK 1824101 3/1/1994 74/335045 11/27/1992 UMU United States of America PINNACLE (CL) UMU United States of America POWERLINE (CL) UMU United States of America POWERMELT 2789384 12/2/2003 76/322708 10/9/2001 UMU United States of America PROWLER 2215353 12/29/1998 75/286226 5/5/1997 UMU United States of America RHB 1399203 7/1/1986 557945 9/12/1985 UMU United States of America RHB SYSTEM 2000 1426264 1/27/1987 557944 9/12/1985 UMU United States of America SENTRY 2308942 1/18/2000 75/566955 10/8/1998 UMU United States of America SERVTEK 2488519 9/11/2001 75/704313 5/13/1999 UMU United States of America SPECTRA (CL) UMU United States of America SPLIT SCREENS (CL) UMU United States of America THERMAWAV 1317645 2/5/1985 444029 9/16/1984 UMU United States of America TIMBER-EX 76/417643 6/3/2002 UMU United States of America TRACKER (CL) UMU United States of America TV SERIES (CL) UMU United States of America VECTOR 1939024 11/28/1995 74/499854 3/4/1994 UMU United States of America VERTEX 2605509 8/6/2002 76/036347 4/28/2000 UMU United States of America VISTA (CL) UMU United States of America VISTAGUARD (CL) UMU United States of America WOLFPACK 2472740 7/31/2001 75/660951 3/15/1999 UMU
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 22 of 64 TRADENAMES Tradenames Cimcool Industrial Products Inc. D-M-E Company D-M-E of Canada Limited D-M-E Manufacturing Inc. D-M-E U.S.A. Inc. Milacron Capital Holdings B.V. Milacron Canada Inc. Milacron Inc. Milacron Industrial Products, Inc. Milacron International Marketing Company Milacron Marketing Company Milacron Plastics Technologies Group Inc. Milacron Resin Abrasives Inc. Nickerson Machinery Chicago, Inc. Northern Supply Company, Inc. Oak International, Inc. Pliers International Inc. Progress Precision Inc. Uniloy Milacron Inc. Uniloy Milacron U.S.A. Inc. 2913607 Canada Limited 450500 Ontario Limited 528950 Ontario Limited
Owner Doing/Business/As ~~D-M-E U.S.A. Inc. Master Unit Die Products, Inc. D-M-E U.S.A. Inc. MUD Quick Change Tooling D-M-E U.S.A. Inc. California D-M-E U.S.A. Inc.~~
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 23 of 64 DOMAIN NAMES
Domain Name Registrant AUTOJECTORS.COM AI CIMFORM.COM MI CONCENTRIC-SERVICES.COM MI D-M-E.COM DME DME.NET MI DMEBE.COM MI DMECO.COM MI DMECOMPANY.COM MI DMEDE.COM MI DMEEU.COM MI DMEEURO.COM DME DMEFR.COM MI DMEUK.COM MI EJECTORBLADES.COM MI EJECTORPINS.COM MI EJECTORSLEEVES.COM MI HOTRUNNERMOLDING.COM MI HOTRUNNERSYSTEMS.COM MI MASTERUNITDIE.COM MI MILACRON.COM MI MILACRON.NET MI MILACRON.ORG MI MILACRONINDIA.COM MI MOLD COOLING.COM MI MOLDACTION.COM MI MOLDASSEMBLIES.COM MI MOLDBASES.COM MI MOLDBASICS.COM MI MOLDCOMPONENTS.COM MI MOLDFUSION.COM MI MOLDTOOLING.COM MI MUDBASE.COM MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 24 of 64 DOMAIN NAMES
Domain Name Registrant MUDSYSTEM.COM MI NICKERSONMACHINERY.COM MI NORMABEST.COM DME NORTHERNSUPPLY.COM NSC OHS-CANADA.COM MI PLASTICS-EDGE.COM MI PLASTICSTOOLING.COM MI SERVTEK.COM MI TEMPCONTROLS.COM MI UNILOY.COM UNI UNILOYMILACRON.COM UNI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS LICENSES Licensee/Licensor "MI" is Milacron Inc. "DME" is D-M-E Company "UNI" is Uniloy Milacron Inc. Page 25 of 64 TRADEMARK LICENSES LICENSE GRANTS
LICENSOR LICENSEE EFFECTIVE DATE TYPE NOTES DME D-M-E COMPANY (INDIA) 2/1/1994 TMO Inter-company trademark license MI ANCHOR/DARLING INDUSTRIES 3/19/1991 TMO Trademark Consent (HYDRADAMP) CINCINNATI MILACRON PRIVATE LIMITED 8/29/1995 TMO Inter-company trademark license CARBORUNDUM UNIVERSAL LTD. 3/20/1994 TMO Trademarks for fluids MEVAG TEKNIK TICARET 2/18/1986 TMO Trademarks for fluids UNI FERROMATIK MILACRON INDIA LIMITED 4/26/2001 TMO Inter-company -- trademarks
LICENSE RIGHTS
LICENSEE LICENSOR EFFECTIVE DATE TYPE NOTES ~~DME METRO INTERNATIONAL GMBH 2/4/2003 TMI Trademark Consent (METEOR)~~
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 26 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Australia ACTUATOR FOR INJECTION MOLDING VALVE GATE 758549 7/31/2003 758549 12/17/1999 DME Australia MOLD HEATER START-UP 736531 11/15/2001 736531 12/9/1998 DME Australia METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 726673 9/5/1997 41817/97 9/5/1997 DME Australia DEVICE FOR MOLDING OR INJECTION MOLDING 695081 11/19/1998 22543 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Australia INJECTION MOLDING HOT RUNNER NOZZLE WITH 2001268498 6/15/2001 DME REMOVABLE SEAL Australia LATCHING DEVICE FOR INJECTION MOLDS WITH 2001268430 6/15/2001 DME REMOVABLE INSERT Australia REPLACEABLE INSERT FOR MOLD LOCK 2002243637 1/23/2002 DME Australia ACTUATOR HAVING DUAL PISTON SURFACES 2001266647 6/1/2001 DME Australia FLOW NOZZLE FOR INJECTION MOLDING 14616/01 11/3/2000 DME Australia THERMAL EXPANSION COMPENSATION SUPPORT 2001269808 6/13/2001 DME Australia MOLDING NOZZLE GATE VALVE 2002250477 3/29/2002 DME Austria METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME Austria DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Belgium DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Brazil LATCHING DEVICE FOR INJECTION MOLDS WITH PI0111603.7 6/15/2001 DME REMOVABLE INSERT
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 27 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Brazil REPLACEABLE INSERT FOR MOLD LOCK PI0206652-1 1/23/2002 DME Brazil METHOD OF MANUFACTURING EJECTOR PIN SLEEVES PI9714722-2 9/5/1997 DME Brazil MOLD HEATER START-UP PI9813392.6 12/9/1998 DME Brazil ACTUATOR FOR INJECTION MOLDING VALVE GATE PI0101588-5 4/25/2001 DME Brazil MOLD CORE POSITIONING DRIVE PI0103629.7 4/24/2002 DME Brazil ACTUATOR HAVING DUAL PISTON SURFACES PI0111450-6 6/1/2001 DME Brazil FLOW NOZZLE FOR INJECTION MOLDING PI0015379-6 11/3/2000 DME Brazil THERMAL EXPANSION COMPENSATION SUPPORT PI0111617.7 6/13/2001 DME Canada METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 2288878 6/17/2003 2288878 9/5/1997 DME Canada DEVICE FOR MOLDING OR INJECTION MOLDING 2188914 2/2/1999 2188914 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Canada LATCHING DEVICE FOR INJECTION MOLDS WITH 2410871 6/15/2001 DME REMOVABLE INSERT Canada REPLACEABLE INSERT FOR MOLD LOCK 2426046 1/23/2002 DME Canada MOLD HEATER START-UP 2313203 12/9/1998 DME Canada ACTUATOR FOR INJECTION MOLDING VALVE GATE 2347023 12/17/1999 DME Canada ACTUATOR HAVING DUAL PISTON SURFACES 2410546 6/1/2001 DME Canada FLOW NOZZLE FOR INJECTION MOLDING 2389983 11/3/2000 DME Canada THERMAL EXPANSION COMPENSATION SUPPORT 2410826 6/13/2001 DME Canada MOLDING NOZZLE GATE VALVE 3/29/2002 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 28 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Denmark DEVICE FOR MOLDING OR INJECTION MOLDING 804330 2/12/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES European Patent Office METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME European Patent Office LATCHING DEVICE FOR INJECTION MOLDS WITH 1946370.2 6/15/2001 DME REMOVABLE INSERT European Patent Office REPLACEABLE INSERT FOR MOLD LOCK 2709136.2 1/23/2002 DME European Patent Office MOLD HEATER START-UP 98963001.7 12/9/1998 DME European Patent Office ACTUATOR FOR INJECTION MOLDING VALVE GATE 99966393.3 12/17/1999 DME European Patent Office MOLD CORE POSITIONING DRIVE 901403.6 1/7/2000 DME European Patent Office ACTUATOR HAVING DUAL PISTON SURFACES 1944212.8 6/1/2001 DME European Patent Office FLOW NOZZLE FOR INJECTION MOLDING 976909.2 11/3/2000 DME European Patent Office THERMAL EXPANSION COMPENSATION SUPPORT 1948346 6/13/2001 DME European Patent Office MOLDING NOZZLE GATE VALVE 2719391.1 3/29/2002 DME France METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME France DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Germany DEVICE FOR MOLDING OR INJECTION MOLDING 9406940.9 7/14/1994 9406940.9 4/26/1994 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Germany HEATING DEVICE 9403416.8 5/19/1994 9403416.8 3/1/1994 DME Germany METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 29 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Germany DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Greece DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Ireland, Republic of DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Italy METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME Italy DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Japan LATCHING DEVICE FOR INJECTION MOLDS WITH 503509 6/15/2001 DME REMOVABLE INSERT Japan REPLACEABLE INSERT FOR MOLD LOCK 559229 1/23/2002 DME Japan MOLD HEATER START-UP 526346 12/9/1998 DME Japan ACTUATOR HAVING DUAL PISTON SURFACES 501640 6/1/2001 DME Japan THERMAL EXPANSION COMPENSATION SUPPORT 510253 6/13/2001 DME Japan MOLDING NOZZLE GATE VALVE 3/29/2002 DME Luxembourg DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 959157899.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Mexico METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 206165 1/24/2002 99/10656 9/5/1997 DME Mexico HEATING DEVICE 197946 2/23/1995 963663 2/23/1995 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 30 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Mexico MOLD HEATER START-UP 00/05634 12/9/1998 DME Monaco DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Netherlands DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.22 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES New Zealand MOLD HEATER START-UP 504867 5/12/2003 504867 12/7/1998 DME Patent Cooperation Treaty INJECTION MOLDING HOT RUNNER NOZZLE WITH 01/19351 6/15/2001 DME REMOVABLE SEAL Patent Cooperation Treaty LATCHING DEVICE FOR INJECTION MOLDS WITH 01/19123 6/15/2001 DME REMOVABLE INSERT Patent Cooperation Treaty REPLACEABLE INSERT FOR MOLD LOCK 02/01881 1/23/2002 DME Patent Cooperation Treaty MULTI PISTON VALVE ACTUATOR US03/30798 9/18/2003 DME Patent Cooperation Treaty CONNECTION ERROR DETECTION AND RESPONSE 03/24672 8/5/2003 DME Patent Cooperation Treaty LOAD CONFIGURABLE ELECTRICAL DISTRIBUTOR BUSS 03/23208 7/25/2003 DME Patent Cooperation Treaty METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 97/15601 9/5/1997 DME Patent Cooperation Treaty MOLD HEATER START-UP 98/26155 12/9/1998 DME Patent Cooperation Treaty ACTUATOR FOR INJECTION MOLDING VALVE GATE 99/30144 12/17/1999 DME Patent Cooperation Treaty MOLD CORE POSITIONING DRIVE 00/00430 1/7/2000 DME Patent Cooperation Treaty ACTUATOR HAVING DUAL PISTON SURFACES 01/17719 6/1/2001 DME Patent Cooperation Treaty FLOW NOZZLE FOR INJECTION MOLDING 00/30364 11/3/2000 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 31 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Patent Cooperation Treaty SLIDE RETAINER WEAR PLATE INSERT 00/27721 10/6/2000 DME Patent Cooperation Treaty THERMAL EXPANSION COMPENSATION SUPPORT 01/18998 6/13/2001 DME Patent Cooperation Treaty MOLDING NOZZLE GATE VALVE US02/09916 3/29/2002 DME Portugal METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME Portugal DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Spain METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME Spain DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Sweden DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Switzerland METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME Switzerland DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES Taiwan LOAD CONFIGURABLE ELECTRICAL DISTRIBUTOR BUSS 92122657 8/18/2003 DME United Kingdom METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 1032715 8/14/2002 97939803.9 9/5/1997 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 32 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United Kingdom DEVICE FOR MOLDING OR INJECTION MOLDING 804330 12/2/1998 95915789.2 4/20/1995 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES United States of America LOAD CONFIGURABLE ELECTRICAL DISTRIBUTOR BUSS 6674006 1/6/2004 10/339846 1/10/2003 DME United States of America THERMAL EXPANSION COMPENSATION SUPPORT 6649112 11/18/2003 10/093622 3/8/2002 DME United States of America SLIDE RETAINER WEAR PLATE INSERT 6443723 9/3/2002 09/433753 11/4/1999 DME United States of America MOLDING NOZZLE GATE VALVE 6419116 7/16/2002 09/794672 2/27/2001 DME United States of America ACTUATOR HAVING DUAL PISTON SURFACES 6386508 5/14/2002 09/587462 6/5/2000 DME United States of America THERMAL EXPANSION COMPENSATION SUPPORT 6368542 4/9/2002 09/595264 6/15/2000 DME United States of America FLOW NOZZLE FOR INJECTION MOLDING 6227461 5/8/2001 09/435683 11/8/1999 DME United States of America MOLD CORE POSITIONING DRIVE 6093015 7/25/2000 09/227846 1/11/1999 DME United States of America ACTUATOR FOR INJECTION MOLDING VALVE GATE 6086357 7/11/2000 09/217295 12/21/1998 DME United States of America MOLD HEATER START-UP 5853631 12/29/1998 08/986347 12/8/1997 DME United States of America DEVICE FOR MOLDING OR INJECTION MOLDING 5824350 10/20/1998 737087 2/7/1997 DME POLYMER COMPOUNDS AND MOLD ACCESSORIES United States of America METHOD OF MANUFACTURING EJECTOR PIN SLEEVES 5730812 3/24/1998 08/858744 5/19/1997 DME United States of America INTERNAL LATCH 5494435 2/27/1996 303764 9/9/1994 DME United States of America SLIDE RETAINER 5397226 3/14/1995 144420 11/2/1993 DME United States of America ANGLE PIN 5234329 8/10/1993 956098 10/2/1992 DME United States of America RUNNER SHUT-OFF 5208053 5/4/1993 770440 10/3/1991 DME United States of America MOISTURE DETECTION 5039842 8/13/1991 362554 6/7/1989 DME United States of America MOLD RETAINER 4961702 10/9/1990 313196 2/21/1989 DME United States of America NOZZLE 4787836 11/29/1988 67868 6/30/1987 DME United States of America NOZZLE ASSEMBLY 4638849 1/27/1987 779984 8/25/1985 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 33 of 64 PATENTS - ------- Owner D-M-E Company (DME)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America INJECTION MOLDING HOT RUNNER NOZZLE WITH 10/297893 12/10/2002 DME REMOVABLE SEAL United States of America INJECTION MOLDING HOT RUNNER NOZZLE WITH 60/212149 6/16/2000 DME REMOVABLE SEAL United States of America LATCHING DEVICE FOR INJECTION MOLDS WITH 60/212150 6/16/2000 DME REMOVABLE INSERT United States of America LATCHING DEVICE FOR INJECTION MOLDS WITH 10/297894 12/10/2002 DME REMOVABLE INSERT United States of America FRONT LOAD ANGLE PIN 10/801183 3/17/2004 DME United States of America REPLACEABLE INSERT FOR MOLD LOCK 10/433551 6/4/2003 DME United States of America MULTI PISTON VALVE ACTUATOR 10/246961 9/20/2002 DME United States of America CONNECTION ERROR DETECTION AND RESPONSE 10/301228 11/21/2002 DME United States of America DOUBLE CAVITY HEADING DIE 60/468777 3/22/2004 DME United States of America Improved Temperature Control 10/846777 5/14/2004 DME United States of America CLAMP D317927 7/2/1991 79340 7/30/1987 DME United States of America CLAMP D318282 7/16/1991 172908 3/22/1988 DME
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 34 of 64 PATENTS - ------- Owner D-M-E USA Inc. (DMU)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America QUICK CHANGE SYSTEM 5562935 10/8/1996 347970 12/10/1994 DMU United States of America QUICK CHANGE BASES 5350289 9/27/1994 920612 7/27/1992 DMU
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 35 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Australia AQUEOUS METALWORKING FLUID 696771 1/7/1999 66472/96 7/12/1996 MI Australia MONOISOPRO/AMINE 682566 1/29/1998 13388/95 12/12/1994 MI Australia FLUID W/ SULFURIZED LUBR 671211 12/3/1996 64628/94 6/8/1994 MI Australia DC BRUSHLESS MOTOR IMM 629410 10/1/1992 64230/90 6/20/1990 MI Australia MACHINING METALWORKING FLUID AND METHOD 2001283441 8/17/2001 MI OF MACHINING Austria CUTTING EQUIPMENT FOR EXTRUDED HOLLOW 988941 12/10/2003 99118583.6 9/21/1999 MI THERMOPLASTIC PROFILES Austria TWIN SCREW EXTRUDER 983836 1/28/2004 99117028.3 8/30/1999 MI Austria RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE Austria METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS Austria ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD Austria MULTI-FUNCTION MOTOR 861148 12/19/2001 96933237.8 10/1/1996 MI Austria MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI Austria 4-AXIS VECTOR MTR DRIVE 715566 1/20/1999 94922485.1 7/6/1994 MI Austria PREHEATING APPARATUS FOR AN EXTRUDER 680402 3/17/1999 94906712.8 1/21/1994 MI Austria FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 7/19/1994 MI Austria ACCUMULATOR HEAD 600905 3/26/1997 92914976.3 7/2/1992 MI Austria MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI Austria MOVABLE PLATEN 566655 5/21/1997 92903999.8 1/10/1992 MI Austria DC DRIVE-VAR VOL PUMP 464286 8/3/1994 90314225.5 12/14/1990 MI Austria DC BRUSHLESS MOTOR IMM 431150 10/12/1994 90914289.5 6/20/1990 MI Austria ADJUST EXTRUSION DIE 393808 12/27/1991 A2830/86 10/23/1986 MI Austria WALL THICKNESS CONTROL A818/87 4/3/1987 MI Belgium RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 36 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Belgium METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS Belgium ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD Belgium MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI Belgium FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI Belgium MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI Brazil DC BRUSHLESS MOTOR IMM PI9006821-1 12/29/1998 PI9006821-1 6/20/1990 MI Brazil ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN PI9610451-1 11/25/2003 PI9610451-1 7/18/1996 MI ACCUMULATOR HEAD Brazil FLUID W/ SULFURIZED LUBR PI9404172-5 9/19/2000 PI9404172-5 10/20/1994 MI Brazil MULTI-FUNCTION MOTOR PI9611594-7 11/25/2003 PI9611594-7 10/1/1996 MI Brazil MONOISOPRO/AMINE PI9405767-2 12/12/1994 MI Brazil AQUEOUS METALWORKING FLUID PI9606678-4 7/12/1996 MI Brazil MACHINING METALWORKING FLUID AND METHOD PI0109630-3 8/17/2001 MI OF MACHINING Brazil 4-AXIS VECTOR MTR DRIVE PI9407455-0 7/6/1994 MI Brazil HYBRID INJECTION MOLDING MACHINE PI9816039-7 9/30/1998 MI Brazil TWO STAGE ELECTRIC INJECTION UNIT WITH PI9815669-1 9/30/1998 MI ROTATABLE PLUNGER Brazil ELECTRICALLY DRIVEN APPARATUS FOR PI0010299-7 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Brazil RAM SUPPORT SKATE FOR AN INJECTION 5/13/1998 MI MOLDING MACHINE Brazil MULTI-MEDIA ENHANCED PROGRAM CONTROLLED PI0113797-2 9/11/2001 MI MACHINE Brazil METHOD FOR SIMULTANEOUS CONTROL OF PI9711277-1 8/22/1997 MI MULTIPLE ACCUMULATORS
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 37 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Canada TWO STAGE ELECTRIC INJECTION UNIT WITH 2321036 1/13/2004 2321036 9/30/1998 MI ROTATABLE PLUNGER Canada RAM SUPPORT SKATE FOR AN INJECTION 2291239 7/15/2003 2291239 5/13/1998 MI MOLDING MACHINE Canada CHARACTERIZATION OF FLUID MISTING 2272636 7/1/2003 2272636 10/29/1998 MI Canada METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 2237711 7/30/2002 2237711 9/25/1997 MI Canada MULTI-FUNCTION MOTOR 2235380 12/4/2001 2235380 10/1/1996 MI Canada DETERMINATION OF AQUEOUS FLUID SURFACTANT 2229446 12/3/2002 2229446 8/4/1997 MI CONCENTRATION Canada AQUEOUS METALWORKING FLUID 2204036 12/3/2002 2204036 7/12/1996 MI Canada 4-AXIS VECTOR MTR DRIVE 2168881 4/13/1999 2168881 7/6/1994 MI Canada MONOISOPRO/AMINE 2156609 7/13/1999 2156609 12/12/1994 MI Canada PREHEATING APPARATUS FOR AN EXTRUDER 2154459 6/18/2002 2154459 1/21/1994 MI Canada TITRATION APPARATUS 2134070 5/15/1999 2134070 6/1/1993 MI Canada FLUID W/ SULFURIZED LUBR 2127680 2/17/1998 2127680 7/8/1994 MI Canada MOLD PROTECT-TONAGE CON 2103061 4/13/1999 2103061 6/16/1992 MI Canada MOVABLE PLATEN 2099992 7/14/1998 2099992 1/10/1992 MI Canada DC BRUSHLESS MOTOR IMM 2035020 3/2/1999 2035020 6/20/1990 MI Canada DC DRIVE-VAR VOL PUMP 2033646 7/18/1995 2033646 -1/4/1991 MI Canada PRECISION COINING MACH 1277115 12/4/1990 543341 7/30/1987 MI Canada LASER SPOTWELDER 1235461 4/19/1988 480544 5/1/1985 MI Canada MOLD CHAMBER FOR IMM 1228961 11/10/1987 481697 5/16/1985 MI Canada SAFETY SCREEN FOR LASER 1225437 8/11/1987 476229 3/11/1985 MI Canada POLYAMIDE+ITS SALTS FLUID 1220484 4/14/1987 398669 3/17/1982 MI Canada AMIDE CORROSION INHIBIT 1203527 4/22/1986 395207 6/22/1983 MI Canada CLOSED LOOP MIXTURE CO 1182885 2/19/1985 416164 11/23/1982 MI Canada MACHINING METALWORKING FLUID AND METHOD 2397794 8/17/2001 MI OF MACHINING Canada HYBRID INJECTION MOLDING MACHINE 2345949 9/30/1998 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 38 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Canada METHOD AND APPARATUS FOR VERIFYING THE 2249031 10/16/1998 MI POSITION OF A MOTOR DRIVER MACHINE ELEMENT Canada METHOD AND APPARATUS FOR DETECTING 2249032 10/16/1998 MI ABERRANT MOTOR OPERATION IN A PLASTICS PROCESSING MACHINE Canada ELECTRICALLY DRIVEN APPARATUS FOR 2372533 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Canada MULTI-MEDIA ENHANCED PROGRAM CONTROLLED 2421784 9/11/2001 MI MACHINE Canada ACCUMULATOR HEAD 2109225 7/2/1992 MI Canada METHOD FOR SIMULTANEOUS CONTROL OF 2264566 8/22/1997 MI MULTIPLE ACCUMULATORS China HYBRID INJECTION MOLDING MACHINE 98814336.4 4/16/2003 98814336.4 9/30/1998 MI China TWO STAGE ELECTRIC INJECTION UNIT WITH 98813644.9 3/26/2003 98813644.9 9/30/1998 MI ROTATABLE PLUNGER China MULTI-FUNCTION MOTOR 96198398.1 10/10/2001 96198398.1 10/1/1996 MI China 4-AXIS VECTOR MTR DRIVE 94193166.8 2/5/2000 94193166.8 7/6/1994 MI China FLUID W/ SULFURIZED LUBR 94108478.7 6/26/1999 94108478.7 7/21/1994 MI China DUAL MOTOR DRIVE SYSTEM FOR INJECTION 808450.5 9/17/2003 808450.5 4/10/2000 MI MOLDING MACHINES China MONOISOPRO/AMINE ZL94113287 10/2/1999 94113287 12/22/1994 MI China DETERMINATION OF AQUEOUS FLUID SURFACTANT 97191192.4 8/4/1997 MI CONCENTRATION China METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 97192333.7 9/25/1997 MI China ELECTRICALLY DRIVEN APPARATUS FOR 807073.3 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Denmark FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 39 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER European Patent Office ELECTRICALLY DRIVEN APPARATUS FOR 1198335 7/30/2003 928793.9 5/2/2000 MI EJECTING INJECTION MOLDED PARTS European Patent Office HYBRID INJECTION MOLDING MACHINE 1144175 3/24/2004 98949737.5 9/30/1998 MI European Patent Office CUTTING EQUIPMENT FOR EXTRUDED HOLLOW 988941 12/10/2003 99118583.6 9/21/1999 MI THERMOPLASTIC PROFILES European Patent Office TWIN SCREW EXTRUDER 983836 1/28/2004 99117028.3 8/30/1999 MI European Patent Office RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE European Patent Office METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS European Patent Office ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD European Patent Office MULTI-FUNCTION MOTOR 861148 12/19/2001 96933237.8 10/1/1996 MI European Patent Office MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI European Patent Office COOLING ELECTRIC COMP 756809 7/1/1998 95909413.7 1/31/1995 MI European Patent Office 4-AXIS VECTOR MTR DRIVE 715566 1/20/1999 94922485.1 7/6/1994 MI European Patent Office MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI European Patent Office PREHEATING APPARATUS FOR AN EXTRUDER 680402 3/17/1999 94906712.8 1/21/1994 MI European Patent Office FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI European Patent Office ACCUMULATOR HEAD 600905 3/26/1997 92914976.3 7/2/1992 MI European Patent Office MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI European Patent Office EJECT UNIT 566681 12/18/1996 92904589.6 1/10/1992 MI European Patent Office MOVABLE PLATEN 566655 5/21/1997 92903999.8 1/10/1992 MI European Patent Office OPEN LOOP TONNAGE CONT 536201 3/4/1998 91911550.1 5/17/1991 MI European Patent Office PLURAL MLD DRIV 500679 9/18/1996 90916874.2 11/5/1990 MI European Patent Office DC DRIVE-VAR VOL PUMP 464286 8/3/1994 90314225.5 12/14/1990 MI European Patent Office DC BRUSHLESS MOTOR IMM 431150 10/12/1994 90914289.5 6/20/1990 MI European Patent Office PRECISION COINING MACH 269204 1/15/1992 87307502.2 8/25/1987 MI European Patent Office D-10 ZEOLITE WATER SOFT 254773 3/1/1989 86201266.3 7/18/1986 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 40 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER European Patent Office METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 97943577.3 9/25/1997 MI European Patent Office MACHINING METALWORKING FLUID AND METHOD 1962246.3 8/17/2001 MI OF MACHINING European Patent Office TWO STAGE ELECTRIC INJECTION UNIT WITH 98952037.4 9/30/1998 MI ROTATABLE PLUNGER European Patent Office DUAL MOTOR DRIVE SYSTEM FOR INJECTION 921981.7 4/10/2000 MI MOLDING MACHINES European Patent Office MULTI-MEDIA ENHANCED PROGRAM CONTROLLED 1966664.3 9/11/2001 MI MACHINE European Patent Office CLOSED BARREL TEMPERING 2001461.9 1/21/2002 MI European Patent Office CLOSED BARREL 2001459.3 1/21/2002 MI France TWIN SCREW EXTRUDER 983836 1/28/2004 99117028.3 8/30/1999 MI France RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE France METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS France ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD France MULTI-FUNCTION MOTOR 861148 12/19/2001 96933237.8 10/1/1996 MI France MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI France COOLING ELECTRIC COMP 756809 7/1/1998 95909413.7 1/31/1995 MI France 4-AXIS VECTOR MTR DRIVE 715566 1/20/1999 94922485.1 7/6/1994 MI France MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI France PREHEATING APPARATUS FOR AN EXTRUDER 680402 3/17/1999 94906712.8 1/21/1994 MI France FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI France EXTRUDED PROFILE PRODUCTION EQUIPMENT 612604 4/28/1999 93890024 2/24/1993 MI France ACCUMULATOR HEAD 600905 3/26/1997 92914976.3 7/2/1992 MI France MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI France DC DRIVE-VAR VOL PUMP 464286 8/3/1994 90314225.5 12/14/1990 MI France PRECISION COINING MACH 269204 1/15/1992 87307502.2 8/25/1987 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 41 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Germany MULTILAYER PLASTIC PIPE 29823984.1 4/27/2000 29823984.1 4/16/1998 MI Germany PNEUMATIC OR HYDRAULIC GUILLOTINE 29808312 8/13/1998 98U2008312 5/11/1998 MI Germany TWIN SCREW EXTRUDER 19839374 3/2/2000 1039374 8/30/1998 MI Germany DOUBLE SCREW EXTRUDER 19824303 12/9/1999 1024303 5/31/1998 MI Germany MULTILAYER PLASTIC PIPE 19816790 10/21/1999 1016790 4/16/1998 MI Germany ELECTRICALLY DRIVEN APPARATUS FOR 1198335 7/30/2003 928793.9 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Germany HYBRID INJECTION MOLDING MACHINE 1144175 3/24/2004 98949737.5 9/30/1998 MI Germany CUTTING EQUIPMENT FOR EXTRUDED HOLLOW 988941 12/10/2003 99118583.6 9/21/1999 MI THERMOPLASTIC PROFILES Germany RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE Germany METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS Germany ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD Germany MULTI-FUNCTION MOTOR 861148 12/19/2001 96933237.8 10/1/1996 MI Germany MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI Germany COOLING ELECTRIC COMP 756809 7/1/1998 95909413.7 1/31/1995 MI Germany 4-AXIS VECTOR MTR DRIVE 715566 1/20/1999 94922485.1 7/6/1994 MI Germany MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI Germany PREHEATING APPARATUS FOR AN EXTRUDER 680402 3/17/1999 94906712.8 1/21/1994 MI Germany FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI Germany ACCUMULATOR HEAD 600905 3/26/1997 92914976.3 7/2/1992 MI Germany MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI Germany MOVABLE PLATEN 566655 5/21/1997 92903999.8 1/10/1992 MI Germany DC DRIVE-VAR VOL PUMP 464286 8/3/1994 90314225.5 12/14/1990 MI Germany DC BRUSHLESS MOTOR IMM 431150 10/12/1994 90914289.5 6/20/1990 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 42 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Germany PRECISION COINING MACH 269204 1/15/1992 87307502.2 8/25/1987 MI Germany TEMPERATURE CONTROL METHOD FOR PLASTICS 29907213.4 4/24/1999 MI EXTRUSION Germany CLOSED BARREL TEMPERING 10102609.9 1/21/2001 MI Germany CLOSED BARREL TEMPERING 10102610.2 1/21/2001 MI Germany EXTRUDER FEEDING AREA 10151579 10/23/2001 MI Hong Kong DETERMINATION OF AQUEOUS FLUID SURFACTANT 99100560.2 2/10/1999 MI CONCENTRATION India MONOISOPRO/AMINE 182644 11/28/1994 992/CAL/94 11/28/1994 MI India FLUID W/ SULFURIZED LUBR 181608 6/17/1994 461/CAL/94 6/17/1994 MI India METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 651/CAL/98 9/25/1997 MI India MULTI-FUNCTION MOTOR 1838/CAL/96 10/18/1996 MI India HYBRID INJECTION MOLDING MACHINE 1776/CAL/98 10/7/1998 MI India TWO STAGE ELECTRIC INJECTION UNIT WITH 1835/CAL/98 10/15/1998 MI ROTATABLE PLUNGER India IMPACTING METHOD AND MACHINING FOR 99/00089 3/16/1999 MI FORMING COMPACTS Italy ELECTRICALLY DRIVEN APPARATUS FOR 1198335 7/30/2003 928793.9 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Italy HYBRID INJECTION MOLDING MACHINE 1144175 3/24/2004 98949737.5 9/30/1998 MI Italy RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE Italy METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS Italy ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD Italy MULTI-FUNCTION MOTOR 861148 12/19/2001 96933237.8 10/1/1996 MI
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COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Italy MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI Italy 4-AXIS VECTOR MTR DRIVE 715566 1/20/1999 94922485.1 7/6/1994 MI Italy MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI Italy PREHEATING APPARATUS FOR AN EXTRUDER 680402 3/17/1999 94906712.8 1/21/1994 MI Italy FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI Italy MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI Italy DC DRIVE-VAR VOL PUMP 464286 8/3/1994 90314225.5 12/14/1990 MI Italy DC BRUSHLESS MOTOR IMM 431150 10/12/1994 90914289.5 6/20/1990 MI Italy PRECISION COINING MACH 269204 1/15/1992 87307502.2 8/25/1987 MI Japan MONOISOPRO/AMINE 3497169 11/28/2003 517472/95 12/12/1994 MI Japan 4-AXIS VECTOR MTR DRIVE 3399532 2/21/2003 508097/95 7/6/1994 MI Japan MOVABLE PLATEN 3283511 3/1/2002 504545/92 1/10/1992 MI Japan ACCUMULATOR HEAD 3217361 8/3/2001 502277/93 7/2/1992 MI Japan DC BRUSHLESS MOTOR IMM 2927949 5/14/1999 513356/90 6/20/1990 MI Japan PRECISION COINING MACH 2548956 8/8/1996 264025/87 10/21/1987 MI Japan FLUID W/ SULFURIZED LUBR 162206/94 7/14/1994 MI Japan COOLING ELECTRIC COMP 527620/95 1/31/1995 MI Japan MOTOR CURRENT CONTROL 528919/95 1/31/1995 MI Japan MULTI-FUNCTION MOTOR 519698/97 10/1/1996 MI Japan HYBRID INJECTION MOLDING MACHINE 572067 9/30/1998 MI Japan TWO STAGE ELECTRIC INJECTION UNIT WITH 2000-531288 9/30/1998 MI ROTATABLE PLUNGER Japan DC DRIVE-VAR VOL PUMP 4472/91 1/18/1991 MI Japan IMM WITHOUT TIE BARS 519092/96 12/1/1995 MI Japan DUAL MOTOR DRIVE SYSTEM FOR INJECTION 612115 4/10/2000 MI MOLDING MACHINES Japan HORIZONTAL TOGGLE IMM 263676/91 10/11/1991 MI Japan WALL THICKNESS CONTROL 82854/88 4/4/1988 MI Japan MASTER/SLAVE CONTROLLER 144911/93 6/16/1993 MI Korea, Republic of MONOISOPRO/AMINE 354981 9/18/2002 703540/95 12/12/1994 MI Korea, Republic of MACHINING FLUID COMPOSITION AND METHOD OF 299648 6/11/2001 703743/98 8/4/1997 MI MACHINING
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 44 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Korea, Republic of METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 270060 7/27/2000 706351-98 9/25/1997 MI Korea, Republic of MULTI-FUNCTION MOTOR 268358 7/12/2000 703713/97 10/1/1996 MI Korea, Republic of DETERMINATION OF AQUEOUS FLUID SURFACTANT 265458 6/14/2000 703221/98 8/4/1997 MI CONCENTRATION Korea, Republic of TITRATION APPARATUS 265457 6/14/2000 704350/94 6/1/1993 MI Korea, Republic of AQUEOUS METALWORKING FLUID 209444 4/21/1999 703713/97 7/12/1996 MI Korea, Republic of DC BRUSHLESS MOTOR IMM 168852 10/8/1998 700199/91 6/20/1990 MI Korea, Republic of FLUID W/ SULFURIZED LUBR 133100 12/16/1997 22185/94 9/3/1994 MI Korea, Republic of SYSTEM MONITOR 701637/91 5/8/1990 MI Korea, Republic of CHARACTERIZATION OF FLUID MISTING 99-7005933 10/29/1998 MI Korea, Republic of MACHINING METALWORKING FLUID AND METHOD 7011624 8/17/2001 MI OF MACHINING Korea, Republic of HYBRID INJECTION MOLDING MACHINE 7004090 9/30/1998 MI Korea, Republic of TWO STAGE ELECTRIC INJECTION UNIT WITH 2000-7008966 9/30/1998 MI ROTATABLE PLUNGER Korea, Republic of ELECTRICALLY DRIVEN APPARATUS FOR 2001-7012983 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Korea, Republic of MOVABLE PLATEN 702070/93 1/10/1992 MI Korea, Republic of EJECT UNIT 702074/93 1/10/1992 MI Korea, Republic of DUAL MOTOR DRIVE SYSTEM FOR INJECTION 7012963 4/10/2000 MI MOLDING MACHINES Korea, Republic of BLOW MOLDING APPARATUS 5037/87 5/21/1987 MI Luxembourg FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI Mexico METHOD FOR SIMULTANEOUS CONTROL OF 212676 1/27/2003 99/01924 8/22/1997 MI MULTIPLE ACCUMULATORS Mexico IMM WITHOUT TIE BARS 196836 6/6/2000 9704304 12/1/1995 MI Mexico MONOISOPRO/AMINE 193103 8/24/1999 9409728 12/15/1994 MI Mexico 4-AXIS VECTOR MTR DRIVE 185204 7/2/1997 9406505 8/26/1994 MI Mexico FLUID W/ SULFURIZED LUBR 184563 4/29/1997 9406594 8/30/1994 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 45 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Mexico DC BRUSHLESS MOTOR IMM 174413 5/13/1994 22714 10/5/1990 MI Mexico POLYAMIDE+ITS SALTS FLUID 159541 6/29/1989 193074 6/9/1982 MI Mexico DETERMINATION OF AQUEOUS FLUID SURFACTANT 9803414 8/4/1997 MI CONCENTRATION Mexico METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 9806261 9/25/1997 MI Mexico MACHINING METALWORKING FLUID AND METHOD 02/08671 8/17/2001 MI OF MACHINING Mexico IMPACTING METHOD AND MACHINING FOR 99/00089 3/16/1999 MI FORMING COMPACTS Mexico MULTI-MEDIA ENHANCED PROGRAM CONTROLLED 03/02087 9/11/2001 MI MACHINE Netherlands MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI Netherlands FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI New Zealand MONOISOPRO/AMINE 277971 7/1/1997 277971 12/12/1994 MI New Zealand FLUID W/ SULFURIZED LUBR 260556 1/9/1996 260556 5/19/1994 MI Norway METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 98/3712 9/25/1997 MI Patent Cooperation Treaty MACHINING METALWORKING FLUID AND METHOD 01/25855 8/17/2001 MI OF MACHINING Patent Cooperation Treaty HYBRID INJECTION MOLDING MACHINE 98/20765 9/30/1998 MI Patent Cooperation Treaty TWO STAGE ELECTRIC INJECTION UNIT WITH 98/20784 9/30/1998 MI ROTATABLE PLUNGER Patent Cooperation Treaty ELECTRICALLY DRIVEN APPARATUS FOR 00/12113 5/2/2000 MI EJECTING INJECTION MOLDED PARTS Patent Cooperation Treaty IMPACTING METHOD AND MACHINING FOR 99/05756 3/16/1999 MI FORMING COMPACTS Patent Cooperation Treaty RAM SUPPORT SKATE FOR AN INJECTION 98/09736 5/13/1998 MI MOLDING MACHINE
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 46 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Patent Cooperation Treaty DUAL MOTOR DRIVE SYSTEM FOR INJECTION 00/09505 4/10/2000 MI MOLDING MACHINES Patent Cooperation Treaty MULTI-MEDIA ENHANCED PROGRAM CONTROLLED 01/28398 9/11/2001 MI MACHINE South Africa FLUID W/ SULFURIZED LUBR 94/3732 4/26/1995 94/3732 5/27/1994 MI South Africa MONOISOPRO/AMINE 94/9904 10/25/1995 94/9904 12/13/1994 MI Spain FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI Spain DC BRUSHLESS MOTOR IMM 431150 10/12/1994 90914289.5 6/20/1990 MI Sweden MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI Sweden FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI Switzerland FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI United Kingdom ELECTRICALLY DRIVEN APPARATUS FOR 1198335 7/30/2003 928793.9 5/2/2000 MI EJECTING INJECTION MOLDED PARTS United Kingdom CUTTING EQUIPMENT FOR EXTRUDED HOLLOW 988941 12/10/2003 99118583.6 9/21/1999 MI THERMOPLASTIC PROFILES United Kingdom TWIN SCREW EXTRUDER 983836 1/28/2004 99117028.3 8/30/1999 MI United Kingdom RAM SUPPORT SKATE FOR AN INJECTION 956187 10/2/2002 98923406.7 5/13/1998 MI MOLDING MACHINE United Kingdom METHOD FOR SIMULTANEOUS CONTROL OF 923447 2/19/2003 97942382.9 8/22/1997 MI MULTIPLE ACCUMULATORS United Kingdom ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 885108 9/13/2000 96925356.6 7/18/1996 MI ACCUMULATOR HEAD United Kingdom MULTI-FUNCTION MOTOR 861148 12/19/2001 96933237.8 10/1/1996 MI United Kingdom MOTOR CURRENT CONTROL 804324 7/25/2001 95908754.8 1/31/1995 MI United Kingdom COOLING ELECTRIC COMP 756809 7/1/1998 95909413.7 1/31/1995 MI United Kingdom 4-AXIS VECTOR MTR DRIVE 715566 1/20/1999 94922485.1 7/6/1994 MI United Kingdom MONOISOPRO/AMINE 684980 5/31/2000 95904874.5 12/12/1994 MI United Kingdom PREHEATING APPARATUS FOR AN EXTRUDER 680402 3/17/1999 94906712.8 1/21/1994 MI United Kingdom FLUID W/ SULFURIZED LUBR 656415 10/8/1997 94111265.8 6/19/1994 MI United Kingdom ACCUMULATOR HEAD 600905 3/26/1997 92914976.3 7/2/1992 MI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 47 of 64 PATENTS - ------- Owner Milacron Inc. (MI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United Kingdom MOLD PROTECT-TONAGE CON 590068 8/19/1998 92914491.3 6/16/1992 MI United Kingdom DC DRIVE-VAR VOL PUMP 464286 8/3/1994 90314225.5 12/14/1990 MI United Kingdom DC BRUSHLESS MOTOR IMM 431150 10/12/1994 90914289.5 6/20/1990 MI United Kingdom PRECISION COINING MACH 269204 1/15/1992 87307502.2 8/25/1987 MI United States of America MULTI-MEDIA ENHANCED PROGRAM CONTROLLED 6609038 8/19/2003 09/658888 9/11/2000 MI MACHINE United States of America NEW DISTRIBUTIVE MIXING ELEMENT FOR 6547431 4/15/2003 09/710109 11/9/2000 MI EXTRUSION AND INJECTION MOLDING United States of America COMPRESSION MOLDED NECK BODY WITH SMOOTH 6312248 11/6/2001 09/755447 1/5/2001 MI INNER WALL United States of America 4-AXIS VECTOR MTR DRIVE 5362222 11/8/1994 113627 8/31/1993 MI United States of America PARALLEL DIG/ANAL CONTL 5062052 10/29/1991 368570 6/20/1989 MI United States of America ELECTRICALLY DRIVEN APPARATUS FOR 09/980508 11/2/2001 MI EJECTING INJECTION MOLDED PARTS United States of America IMPACTING METHOD AND MACHINING FOR 09/056819 4/8/1998 MI FORMING COMPACTS
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 48 of 64 PATENTS - ------- Owner Milacron Industrial Products Inc. (MIP)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America MACHINING METALWORKING FLUID AND METHOD 6316394 11/13/2001 09/771267 1/29/2001 MIP OF MACHINING United States of America CHARACTERIZATION OF FLUID MISTING 5889201 3/30/1999 962549 10/31/1997 MIP United States of America MACHINING FLUID AND METHOD 5874390 2/23/1999 995364 12/22/1997 MIP United States of America MACHINING FLUID COMPOSITION AND METHOD OF 5716917 2/10/1998 719240 9/24/1996 MIP MACHINING United States of America METHOD OF ANALYSIS FOR AQUEOUS FLUIDS 5710372 1/20/1998 768190 12/17/1996 MIP United States of America DETERMINATION OF AQUEOUS FLUID SURFACTANT 5710048 1/20/1998 706871 9/3/1996 MIP CONCENTRATION United States of America AQUEOUS METALWORKING FLUID 5706684 1/13/1998 538528 10/3/1995 MIP United States of America AQUEOUS LUBRICANT 5667349 9/16/1997 427932 4/26/1995 MIP United States of America MONOISOPRO/AMINE 5512191 4/30/1996 412353 3/28/1995 MIP United States of America FLUID W/ SULFURIZED LUBR 5391310 2/21/1995 156323 11/23/1993 MIP United States of America TITRATION APPARATUS 5389546 2/14/1995 230445 4/20/1994 MIP
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 49 of 64 PATENTS - ------- Owner Oak International Inc. (OI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER ~~United States of America LUBRICATING OIL COMPOSITIONS USED IN 5809628 9/22/1998 616247 3/15/1996 OI METAL FORMING OPERATIONS~~
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 50 of 64 PATENTS - ------- Owner Uniloy Milacron Inc. (UMI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Australia POST MOLDING ID NECK TRIMMING APPARATUS 199942382 7/30/1999 UMI Canada ACCUMULATOR HEAD WITH DIVERTER SLEEVE 1247814 1/3/1989 516053 8/15/1986 UMI Canada CONTAINER 2000-1066 UMI European Patent Office QUICK CHANGE EJECTION STATION TOOLING 1289733 5/24/2001 UMI European Patent Office MOBILE TOOLING BASE 1289724 5/24/2001 UMI European Patent Office BLOW MOLDING MACHINE HAVING FLEXIBLE 1289723 5/24/2001 UMI CAVITATION European Patent Office UNRESTRAINED PREFORM CARRIERS FOR A BLOW 1289722 5/24/2001 UMI MOLDING MACHINE European Patent Office SEALING BLADE FOR SEALING OF A BLOW 1283801 2/2/2001 UMI MOLDED CONTAINER European Patent Office ROTARY DEFLASHING APPARATUS 1283772 2/2/2001 UMI France DESIGN FOR CONTAINER FOR LIQUIDS 820783 3/5/1982 UMI Patent Cooperation Treaty UNRESTRAINED PREFORM CARRIERS FOR A BLOW PCT/US01/16744 5/24/2001 UMI MOLDING MACHINE Patent Cooperation Treaty MOBILE TOOLING BASE PCT/US01/16998 5/24/2001 UMI Patent Cooperation Treaty QUICK CHANGE EJECTION STATION PCT/US01/16997 5/24/2001 UMI Patent Cooperation Treaty SEALING BLADE FOR SEALING OF A BLOW PCT/US01/03723 2/2/2001 UMI MOLDED CONTAINER Patent Cooperation Treaty ROTARY DEFLASHING APPARATUS PCT/US01/03722 2/2/2001 UMI Patent Cooperation Treaty MILK JUG PCT/US98/23060 10/30/1998 UMI Patent Cooperation Treaty BMM HAVING FLEXIBLE CAVITATION PCT/US01/16996 5/24/2001 UMI United Kingdom POST MOLDING ID NECK TRIMMING APPARATUS 9917438 7/23/1999 UMI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 51 of 64 PATENTS - ------- Owner Uniloy Milacron Inc. (UMI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America BEVERAGE CONTAINER D427076 6/27/2000 29/106881 6/23/1999 UMI United States of America BEVERAGE CONTAINER D415035 10/12/1999 29/078893 10/30/1997 UMI United States of America DESIGN D391854 3/10/1998 29/069197 4/11/1997 UMI United States of America ROTARY DEFLASHING APPARATUS 6360414 3/26/2002 09/578811 5/24/2000 UMI United States of America POST MOLDING ID NECK TRIMMING APPARATUS 6311593 11/6/2001 09/584898 5/26/2000 UMI United States of America POST MOLDING ID NECK TRIMMING APPARATUS 6158317 12/12/2000 09/172889 10/15/1998 UMI United States of America EXTRUSION HEAD FOR BLOW MOLDING 5620722 4/15/1997 08/538721 10/3/1995 UMI United States of America INJECTION BLOW MOLDING APPARATUS 5518392 5/21/1996 08/129895 9/30/1993 UMI INCLUDING STACKED MOLDS United States of America FLEXIBLE PART DEFLASHER 5470220 11/28/1995 08/079434 6/17/1993 UMI United States of America COMPRESSION MOLDING AND TRIMMING BLOW PIN 5449284 9/12/1995 08/202267 2/25/1994 UMI ASSEMBLY United States of America METHOD FOR SORTING PLASTIC ARTICLES 5141110 8/25/1992 477606 12/28/1990 UMI United States of America SEQUENTIAL METHOD OF OPERATION OF 5135703 8/4/1992 701093 5/16/1991 UMI COMBINATION PLASTIC AND GAS INJECTION NOZZLE ASSEMBLY United States of America COMBINATION PLASTIC AND GAS INJECTION 5054689 10/8/1991 522190 5/11/1990 UMI NOZZLE ASSEMBLY AND SEQUENTIAL METHOD OF OPERATION United States of America DUAL PARISON EXTRUSION HEAD FOR 4940403 7/10/1990 345566 5/1/1989 UMI MULTILAYER BLOW MOLDING United States of America CONTAINER 29/112999 10/27/1999 UMI United States of America INJECTION MOLD CLAMPING SYSTEM 10/383488 3/7/2003 UMI
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 52 of 64 PATENTS - ------- Owner Uniloy Milacron Inc. (UMI)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America MOBILE TOOLING BASE 10/297460 12/5/2002 UMI United States of America BLOW MOLDING MACHINE HAVING FLEXIBLE 10/297463 12/6/2002 UMI CAVITATION United States of America UNRESTRAINED PREFORM CARRIERS FOR A BLOW 10/297457 12/6/2002 UMI MOLDING MACHINE
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 53 of 64 PATENTS - ------- Owner Uniloy Milacron USA Inc. (UMU)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER Patent Cooperation Treaty POWER FAILURE DETECTION AND RESPONSE 03/36948 11/19/2003 UMU United States of America ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN RE36682 5/2/2000 09/304318 5/3/1999 UMU ACCUMULATOR HEAD United States of America INJECTION MOLDING MCHE D357484 4/18/1995 16325 12/13/1993 UMU United States of America MOVABLE PLATEN D341602 11/23/1993 659150 2/22/1991 UMU United States of America METHOD AND APPARATUS FOR EJECTOR SET-UP 6533972 3/18/2003 09/499284 2/7/2000 UMU United States of America TWO STAGE ELECTRIC INJECTION UNIT WITH 6471904 10/29/2002 09/770343 1/26/2001 UMU ROTATABLE PLUNGER United States of America METHOD AND APPARATUS FOR SETTING DIE HEIGHT 6419861 7/16/2002 09/437133 11/10/1999 UMU United States of America RAM SUPPORT SKATE FOR AN INJECTION MOLDING 6328553 12/11/2001 09/402414 11/13/1998 UMU MACHINE United States of America LOCKING APPARATUS FOR A MOVABLE PLATEN 6231329 5/15/2001 09/326237 6/4/1999 UMU United States of America COMPRESSION MOLDED NECK BODY WITH SMOOTH 6221305 4/24/2001 09/197934 11/23/1998 UMU INNER WALL United States of America BI-DIRECTIONAL CHECK RING FOR A TWO STAGE 6200127 3/13/2001 09/258729 2/26/1999 UMU INJECTION UNIT United States of America TWO STAGE ELECTRIC INJECTION UNIT WITH 6193499 2/17/2001 09/248935 2/12/1999 UMU ROTATABLE PLUNGER United States of America METHOD FOR SIMULTANEOUS CONTROL OF 6171531 1/9/2001 09/242832 8/22/1997 UMU MULTIPLE ACCUMULATORS United States of America DUAL MOTOR DRIVE SYSTEM FOR INJECTION 6149418 11/21/2000 09/294081 4/16/1999 UMU MOLDING MACHINES United States of America DIE PIN STROKE POSITIONER 6142762 11/7/2000 09/203865 12/2/1998 UMU United States of America HYBRID INJECTION MOLDING MACHINE 6120277 9/19/2000 09/306330 5/6/1999 UMU United States of America TWO STAGE ELECTRIC INJECTION UNIT WITH 6086353 7/11/2000 09/024731 2/17/1998 UMU ROTATABLE PLUNGER
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 54 of 64 PATENTS - ------- Owner Uniloy Milacron USA Inc. (UMU)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America METHOD AND APPARATUS FOR VERIFYING THE 6011376 1/4/2000 09/042298 3/13/1998 UMU POSITION OF A MOTOR DRIVER MACHINE ELEMENT United States of America METHOD AND APPARATUS FOR DETECTING 5929583 7/27/1999 42272 3/13/1998 UMU ABERRANT MOTOR OPERATION IN A PLASTICS PROCESSING MACHINE United States of America HYBRID INJECTION MOLDING MACHINE 5916602 6/29/1999 901752 7/28/1997 UMU United States of America ACCUMULATOR HEAD HAVING A SEGMENTED BARREL 5900260 5/4/1999 08/761915 12/9/1996 UMU United States of America FLEXIBLE LOCKING GATE FOR AN EXTRUDER 5888557 3/30/1999 1/23/1998 UMU United States of America TWO STAGE ELECTRIC INJECTION UNIT FOR A 5863567 1/26/1999 901744 7/28/1997 UMU MOLDING MACHINE United States of America PREHEATING APPARATUS FOR AN EXTRUDER 5807517 9/15/1998 08/835260 4/8/1997 UMU United States of America RETAINER FOR THE DIE PIN IN AN ACCUMULATOR 5792486 8/11/1998 832513 4/3/1997 UMU HEAD United States of America PREHEATING APPARATUS FOR AN EXTRUDER 5750158 5/12/1998 08/308876 9/19/1994 UMU United States of America DUAL FLOW DIVIDER WITH DIVERTER VALVE 5711349 1/27/1998 781253 1/10/1997 UMU United States of America ELECTROMECHANICAL DRIVE ASSEMBLY FOR AN 5645873 7/8/1997 514578 8/14/1995 UMU ACCUMULATOR HEAD United States of America MULTI-FUNCTION MOTOR 5645868 7/8/1997 560129 11/17/1995 UMU United States of America VACUUM SHUTTLE VALVE 5634953 6/3/1997 425528 4/20/1995 UMU United States of America COOLING ELECTRIC COMP 5620646 4/15/1997 553791 10/23/1995 UMU United States of America DUAL FLOW DIVIDER WITH DIVERTER VALVE 5616350 4/1/1997 419306 4/10/1995 UMU United States of America CO-INJECTION MACHINE 5601773 2/11/1997 439925 5/12/1995 UMU United States of America IMM WITHOUT TIE BARS 5538415 7/23/1996 354175 12/12/1994 UMU United States of America COOLING ELECTRIC COMP 5523640 6/4/1996 231080 4/22/1994 UMU United States of America MOTOR CURRENT CONTROL 5469038 11/21/1995 240128 5/10/1994 UMU
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 55 of 64 PATENTS - ------- Owner Uniloy Milacron USA Inc. (UMU)
COUNTRY SHORT TITLE PATENT NO. GRANT DATE APPLICATION NO. DATE FILED OWNER United States of America DYNAMIC BRAKING 5469031 11/21/1995 326971 10/21/1994 UMU United States of America TWO-STAGE INJECTION 5454995 10/3/1995 229476 4/18/1994 UMU United States of America MASTER/SLAVE CONTROLLER 5239247 8/24/1993 900811 6/17/1992 UMU United States of America SLIDING EXTRUSION HEAD 5208049 5/4/1993 820241 1/14/1992 UMU United States of America BARREL HEATER/COOLER 5200205 4/6/1993 690277 4/24/1991 UMU United States of America PLURAL MLD DRIV 5190714 3/2/1993 791205 11/13/1991 UMU United States of America VEL CONTROL 5185109 2/9/1993 758663 9/12/1991 UMU United States of America VEL PROFILE ON LOCKOVER 5180530 1/19/1993 705831 5/28/1991 UMU United States of America REV TAPER SPIRAL CHAN 5178458 1/12/1993 666706 3/8/1991 UMU United States of America MOLD PROTECT-TONAGE CON 5149471 9/22/1992 716423 6/17/1991 UMU United States of America MOVABLE PLATEN 5123834 6/23/1992 638994 1/10/1991 UMU United States of America ACCUMULATOR HEAD 5116215 5/26/1992 726227 7/5/1991 UMU United States of America PLURAL MLD DRIV 5102327 4/7/1992 600850 10/22/1990 UMU United States of America OVER/UNDER EXTRUDERS 5076777 12/31/1991 631235 12/20/1990 UMU United States of America DC DRIVE-VAR VOL PUMP 5052909 10/1/1991 616752 11/16/1990 UMU United States of America DC BRUSHLESS MOTOR IMM 4988273 1/29/1991 370669 6/23/1989 UMU United States of America CYCLINDER SEAL-VAC TUBE 4945724 8/7/1990 301980 1/26/1989 UMU United States of America ADAPTIVE TONNAGE CONTRL 4942004 7/17/1990 265709 11/1/1988 UMU United States of America PRECISION COINING MACH 4907960 3/13/1990 228771 8/4/1988 UMU United States of America POWER FAILURE DETECTION AND RESPONSE 10/308994 12/3/2002 UMU
Licensee/Licensor "MI" is Milacron Inc. "MPTG" is Milacron Plastics Technology Group Inc. "DME" is D-M-E Company "UNI" is Uniloy Milacron Inc. SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS LICENSES Page 56 of 64 PATENT LICENSES LICENSE GRANTS
LICENSOR LICENSEE EFFECTIVE DATE TYPE NOTES MI CIMCOOL INDUSTRIAL PRODUCTS B.V. 1/1/1990 PLO Inter-company IP CINCINNATI MILACRON BV 2/16/1987 TLO Inter-company IP CINCINNATI MILACRON PRIVATE LIMITED 8/29/1995 TLO Inter-company technology license FANUC LTD. 11/15/1983 TLO LICENSE W/GRANT-BACK UNIVERSITY OF CINCINNATI 2/14/2002 PLO Patent US 5,889,201 BATTENFELD IMT 9/12/2003 PLO Patent US 5,062,052 (Confidential) BATTENFELD SERVICE GMBH 6/9/1997 PLO Patent EP0566681 DR. BOY GMBH & CO. 2/7/2002 PLO Patent US 5,062,052 (Confidential settlement) ENGEL MASCHINENBAU GMBH 11/17/1998 PLO Patent US 5,052,909 HUSKY INJECTION MOLDING SYSTEMS, LTD. 6/22/2000 PLO Patent US 5,062,052 (Confidential Settlement) MAGNUM LLC 5/1/1997 PLO Patent US 5,052,909 MANNESMANN GROUP 9/20/2000 PLO Patent US 5,062,052 (Confidential) SANDRETTO INDUSTRIES S.P.A. 9/17/2001 PLO Patent US 5,062,052 (Confidential Settlement) SIDEL S.A. 3/27/2002 PLO Patent US 5,062,052 (Confidential Settlement--cross license) SIG PLASTICS INTERNATIONAL GMBH 4/13/2001 PLO Patent US 5,062,052 (Confidential Settlement) SIPA S.P.A. 2/21/2002 PLO Patent US 5,062,052 (Confidential Settlement) U.S. PRECISION LENS INC. 2/14/1995 PLO Patent US 5,052,909 UBE INDUSTRIES, LTD. 11/6/2000 PLO Patent US 5,062,052 (Confidential Settlement) VICKERS, INC. 9/30/1997 PLO CROSS LICENSE (Patent US 5,062,052) VICKERS, INC. 5/15/1998 PLO Patent US 6,011,376 DME D-M-E COMPANY (INDIA) 2/1/1994 TLO Inter-company technology license OI PAZ LUBRICANTS AND CHEMICALS LTD. 10/14/1998 TLO Fluid formulations UNI FERROMATIK MILACRON INDIA LIMITED 4/26/2001 TLO Inter-company -- know-how SIMCO/RAMIC CORP. 11/17/1994 PLO Patent US 5,141,110
Licensee/Licensor "MI" is Milacron Inc. "MPTG" is Milacron Plastics Technology Group Inc. "DME" is D-M-E Company "UNI" is Uniloy Milacron Inc. SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS LICENSES Page 57 of 64 PATENT LICENSES LICENSE RIGHTS
LICENSEE LICENSOR EFFECTIVE DATE TYPE NOTES DME BOKICH, MICHAEL STEVEN 8/31/2001 PLI Invention assignment w/royalty provision ORYCON CONTROL TECHNOLOGY, INC. 8/28/2002 PLI Confidential Settlement (US 5,227,179) VANDENBERG, L.A. 5/4/1993 PLI Patent assignment w/royalty provision (US 5234329) VANDENBERG, L.A. 6/1/1993 PLI Patent assignment w/royalty provision (US 5208053) VANDENBERG, L.A. 3/14/1995 PLI Patent assignment w/royalty provision (US 5397226) VANDENBERG, L.A. 3/1/1996 PLI Patent assignment w/royalty provision (US 5494435) MI ANGUS CHEMICAL COMPANY 10/22/1992 TLI Production of triazine under EPA registration BEMIS MANUFACTURING COMPANY 7/19/1994 PLI U.S. Patent No. 5,486,327 Colorant Injection technology BEMIS MANUFACTURING COMPANY 1/26/1995 PLI U.S. Patent No. 5,650,178 Co-injection technology LEMELSON FOUNDATION 1/2/1999 PLI Patents (Confidential) LEMELSON, JEROME 2/8/1990 PLI Patents MILLCREEK BLOW MOULDING SYSTEMS, LTD. 1/15/1991 TLI Know-how--paid up CINPRES LIMITED 2/21/1994 PLI Patents--gas injection LEMELSON, JEROME 1/17/1992 PLI Patents--paid up REINHART, LAWRENCE W. 4/23/2003 PLI Patent US 5,106,276 TREXEL, INC. 7/15/1999 PLI IMM TREXEL, INC. 7/27/2000 PLI EXT VICKERS, INC. 9/30/1997 PLI CROSS LICENSE (5,266,874) WOMER, TIMOTHY 3/5/2001 PLI Royalty Agreement (US 6,547,431)
Licensee/Licensor "MI" is Milacron Inc. "MPTG" is Milacron Plastics Technology Group Inc. "DME" is D-M-E Company "UNI" is Uniloy Milacron Inc. SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS LICENSES Page 58 of 64 PATENT LICENSES
LICENSEE LICENSOR EFFECTIVE DATE TYPE NOTES MPTG UNILOY MILACRON USA INC. 1/1/2000 PLI Inter-company IP UNI HIRSCHBERGER, MICHAEL 1/29/1996 PLI UNILOY BK (US 5,046,938) SIDEL S.A. 3/27/2002 PLI Patent US 5,968,560 (Confidential Settlement -- cross license) UNILOY MILACRON GERMANY GMBH 12/15/2000 TLI Inter-company -- know-how
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 59 of 64 COPYRIGHTS (U.S. REGISTRATIONS) Owner Uniloy Milacron Inc. (UMI)
TITLE TYPE OF WORK REGISTRATION NO. REG. DATE PUBLICATION OWNER DATE ~~Uniloy Dairy Gallon Label Literary TX-3-663-309 11/4/1993 6/8/1993 UMI Owner Uniloy Milacron USA Inc. (UMU)~~

TITLE TYPE OF WORK REGISTRATION NO. REG. DATE PUBLICATION OWNER DATE Cincinnati Milacron reaction injection molding machine : RIMM-90 Literary TX-547-790 5/19/1980 3/12/80 UMU EP : general operating manual Cincinnati Milacron integrated blow molding machine, CSM-1000 : Literary TX-400-561 1/21/1980 12/5/79 UMU general operating manual Service parts bottle list : RHB-V part number : RHB-V Parts Literary TX-1-256-732 12/27/1983 10/17/83 UMU manual Cincinnati Milacron reaction injection molding machine : Literary TX-1-309-043 2/22/1984 8/1/83 UMU RIMM-125 : general operating manual Bottle machinery replacement parts Literary TX-1-310-077 3/19/1984 2/15/84 UMU Cincinnati Milacron re-heat blow molding machine RHB IX general Literary TX-1-319-334 4/4/1984 3/12/80 UMU operating manual Cincinnati Milacron reheat blow molding machine RHB-VII : Literary TX-1-319-404 4/4/1984 3/5/84 UMU general operating manual RHB V/4000 : re-heat blow molding machine : general operating Literary TX-1-331-250 4/12/1984 3/20/84 UMU manual RHB-IX repair parts manual Literary TX-1-350-661 4/4/1984 11/1/83 UMU Bottle machinery replacement parts Literary TX-1-411-515 9/17/1984 7/17/84 UMU Installation operation and maintenance manual Literary TX-1-426-715 9/4/1984 6/10/84 UMU Mixhead maintenance and repair Literary TX-1-428-246 10/9/1984 9/27/84 UMU Camac-XTA user's manual Literary TX-1-861-020 7/7/1986 11/1/85 UMU
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 60 of 64 COPYRIGHTS (U.S. REGISTRATIONS)
TITLE TYPE OF WORK REGISTRATION NO. REG. DATE PUBLICATION OWNER DATE Camac-XTC Literary TX-1-862-101 7/10/1986 11/1/85 UMU Injection molding machines T-75, T-100, T-150 repair parts manual Literary TX-1-879-206 8/20/1986 12/1/85 UMU Camac-XTA user's manual Literary TX-1-894-811 9/3/1986 11/1/85 UMU Injection molding machines 1500 ton hydraulic repair parts manual Literary TX-1-929-254 8/20/1986 12/1/85 UMU Cincinnati Milacron injection molding machines, 1000 ton Literary TX-1-941-751 8/20/1986 12/1/85 UMU hydraulic : repair parts manual Cincinnati Milacron injection molding machines, 1000/1500 ton Literary TX-1-941-752 8/20/1986 12/1/85 UMU hydraulic : general operating manual MPC-81/86 users manual Literary TX-1-952-671 7/7/1986 11/1/85 UMU Vista operations manual : vol. no. 1, operators Literary TX-2-024-985 2/9/1987 12/1/86 UMU Plastics Machinery Division vendor quality policy Literary TX-2-268-213 1/11/1988 12/1/87 UMU Cincinnati Milacron re-heat blow molding machine RHB-W user's Literary TX-2-293-678 2/18/1988 1/1/88 UMU manual Mini-pellet feeder with Omni IV-X control Literary TX-3-734-044 5/27/1994 2/1/93 UMU Pellet feeder with Omni-IV control Literary TX-3-734-045 5/27/1994 2/1/93 UMU Pellet feeder : user's manual Literary TX-3-734-047 5/27/1994 2/1/93 UMU Pellet feeder with Omni IV-X control Literary TX-3-734-049 5/27/1994 2/1/93 UMU DD200-3000 solid bed dryer with Omni II-XL control Literary TX-3-734-050 5/27/1994 11/1/92 UMU Vista Toggle--VEL : user's manual Literary TX-3-802-812 5/27/1994 4/1/92 UMU Mini-pellet feeder with Omni IV control Literary TX-3-830-980 5/27/1994 2/1/93 UMU Additive feeder with electromechanical control Literary TX-3-830-983 5/27/1994 1/1/93 UMU Cincinnati Milacron Vista Hydraulic--VEL user's manual Literary TX-3-843-663 5/27/1994 9/1/93 UMU Cincinnati Milacron magna 486 user's manual Literary TX-4-086-365 3/4/1996 2/1/96 UMU Roboshot 110R parts manual Literary TX-4-090-245 8/18/1995 7/1/95 UMU Roboshot 55R parts manual Literary TX-4-091-215 8/18/1995 7/1/95 UMU Vista hydraulic-486 : user's manual Literary TX-4-111-464 9/18/1995 6/1/95 UMU Roboshot 165R parts manual Literary TX-4-114-146 8/25/1995 7/1/95 UMU
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 61 of 64 COPYRIGHTS (U.S. REGISTRATIONS)
TITLE TYPE OF WORK REGISTRATION NO. REG. DATE PUBLICATION OWNER DATE Roboshot 250R parts manual Literary TX-4-122-079 8/18/1995 7/1/95 UMU Injection molding machines user's manual Literary TX-4-124-576 10/6/1995 9/1/95 UMU Vista toggle-VSx user's manual Literary TX-4-132-578 8/11/1995 6/1/95 UMU Cincinnati Milacron eclipse E75, E90 extrusion Literary TX-4-140-214 9/22/1995 9/1/95 UMU blowmolding--486 : user's manual Roboshot 33R parts manual Literary TX-4-145-507 8/18/1995 7/1/95 UMU Roboshot 330R parts manual Literary TX-4-145-508 8/18/1995 7/1/95 UMU CMT 35 user's manual Literary TX-4-151-064 10/2/1995 8/1/95 UMU Vista Toggle-VSX : user's manual Literary TX-4-153-365 11/24/1995 10/10/95 UMU Vista Toggle-486 : user's manual Literary TX-4-153-366 11/24/1995 10/1/95 UMU Vista large hydraulic-486 1000/1500 ton : user's manual Literary TX-4-163-034 10/2/1995 6/1/95 UMU Vista hydraulic-486 : user's manual Literary TX-4-163-035 10/3/1995 8/1/95 UMU Vista toggle-VSx : user's manual Literary TX-4-163-036 10/2/1995 7/1/95 UMU Injection molding machines : user's manual Literary TX-4-179-871 2/2/1996 1/1/96 UMU Roboshot user's manual Literary TX-4-190-347 1/26/1996 12/1/95 UMU Vista sentry-VSX user's manual Literary TX-4-210-767 1/29/1996 12/1/95 UMU Eclipse T-series extrusion blowmolding-486 user's manual Literary TX-4-215-634 2/16/1996 1/1/96 UMU with 60-100 lb. head Vista sentry-VST user's manual Literary TX-4-215-635 2/16/1996 1/1/96 UMU Vista sentry-VSX user's manual Literary TX-4-215-913 1/29/1996 1/1/96 UMU Vista toggle-486 : user's manual Literary TX-4-221-977 2/16/1996 1/1/96 UMU Vista toggle-VSX : user's manual Literary TX-4-221-978 2/16/1996 1/1/96 UMU Elektra : user's manual Literary TX-4-221-979 2/16/1996 1/1/96 UMU Vista Toggle-VSx user's manual Literary TX-4-248-724 4/12/1996 3/1/96 UMU Injection molding machines user's manual Literary TX-4-280-641 4/25/1996 4/1/96 UMU Magna 486 user's manual Literary TX-4-290-670 5/7/1996 3/1/96 UMU Shuttle Vector VST user's manual Literary TX-4-297-235 6/10/1996 2/1/96 UMU Cincinnati Milacron Elektra user's manual Literary TX-4-322-344 6/10/1996 3/1/96 UMU
Licensee/Licensor "MI" is Milacron Inc. SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 62 of 64 COPYRIGHT LICENSES LICENSE RIGHTS
LICENSEE LICENSOR EFFECTIVE DATE TYPE NOTES MI COVEY, STEPHEN 5/17/1993 CLI Copying of training materials JURAN ENTERPRISES, INC. 3/26/1982 CLI Copying of training materials
Software Licenses LICENSE RIGHTS
LICENSEE LICENSOR AGREEMENT SUBJECT MATTER EFFECTIVE DME J.D. Edwards 12/29/1997 GENESIS Software DME Trade Point Systems LLC (International 8/27/1998 SPEX 400 Export Documentation System Software Marketing, Inc.) MI COMPUTER ASSOCIATES 12/13/1999 Order Entry/Manufacturing Support Software MI FOREIGN TRADE ZONE CORP. 4/2/2001 FTZ Management Software MI HYPERION SOFTWARE OPERATIONS, INC. 12/24/1996 Commercial (Accounting) Software MI JUST IN TIME RESOURCES INTERNATIONAL, INC. 8/18/1992 Commercial Enterprise Software MI ORACLE CORPORATION 8/12/1992 Commercial (Database) Software MI ORACLE CORPORATION 8/6/1993 Commercial (Database) Software MI PARAMETRIC TECHNOLOGY CORP. 3/15/2003 PRO Engineer Software MI PEOPLESOFT 6/30/2000 Software License Amendment MI PEOPLESOFT 10/17/2002 Software License Amendment MI PEOPLESOFT USA, INC. 2/16/2001 Software License Amendment MI PEOPLESOFT, INC. 6/28/1993 Commercial Software (HRMS)
SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 63 of 64 CLAIMS & WRITTEN NOTICES Amway In a letter dated 8 December 1999, Amway Corporation gave notice to UNILOY of Amway's belief that use of some or all of the equipment supplied by UNILOY could be of interest in respect of patents that the Lemelson Foundation asserted were infringed by Amway and notice of UNILOY's duty of indemnification in respect of that equipment. The patents asserted are characterized as relating to bar coding and machine vision. By written notice dated 23 August 2000, Amway notified UNILOY that a complaint had been filed against Amway in respect of the assertion by the Lemelson Foundation. UNILOY has not identified any bar coding or machine vision equipment supplied to Amway. A written request was made to Amway 13 September 2000 for information concerning any equipment supplied to Amway by UNILOY on which Amway based their request for indemnification. There has been no correspondence in this matter since the written request of 13 September 2000. The suit by the Lemelson Foundation against Amway and others was stayed 5 January 2001 pending resolution of an action by Symbol Technologies and others against the Lemelson Foundation and concerning patents asserted against Amway. By decision 23 January 2004 fourteen patents asserted against Amway were held invalid in the Symbol Technologies litigation. Solaia Technology LLC. In a letter dated 3 June 2003, counsel for Solaia Technology LLC ("Solaia") asserted the likelihood of infringement of U.S. Patent 5,038,318 by Milacron's use of systems comprising programmable controllers connected via network to a computer. Solaia's counsel was informed by letter 18 July 2003 that no systems as described by Solaia's counsel had been identified in Milacron facilities and requested that Solaia's counsel provide any contrary information known to them without delay. Solaia's counsel has provided no information regarding any systems of Milacron upon which an accusation of infringement may be based, but has stated that it will be investigating further. Superbolt Inc. UNILOY received written notice dated 8 February 2000 from Superbolt Inc. of their patent pertaining to certain tie-bar nuts used by UNILOY. UNILOY's use of the accused devices has been limited, and estimated exposure is less than $10,000. Following the original notice from Superbolt, discussions were had between principals of both Superbolt and Uniloy in April of 2000 to resolve the matter. A final proposal expected from Superbolt to resolve the claim has not been received. The asserted patent expired 18 November 2003. Graham Engineering Suit was brought by Milacron Inc. in US District Court (filed October 2002, served December 2002) against Graham Engineering Corporation alleging infringement of Milacron's U.S. patent 5,062,052 relating to computer based controls for plastic molding machines. Graham is both a manufacturer and an importer (products of Hesta of Germany) of blow molding machinery. In December 2003 the court issued its ruling on interpretation of the asserted patent and ordered court-supervised mediation. No resolution has been reached through mediation. Graham filed summary judgment motions 13 February 2004 seeking rulings that the accused products do not infringe the asserted patent and that the asserted patent is invalid. SCHEDULE II INTELLECTUAL PROPERTY AND LICENSES; TRADEMARKS Page 64 of 64 CLAIMS & WRITTEN NOTICES Metalloid. Suit was brought in the Circuit Court for the County of Huntington (IN) 16 October 2002 by Oak International Inc. for trade secret misappropriation and unfair competition by Metalloid Corporation (Huntington, IN) and two former Oak employees. The suit seeks damages and injunctive relief. Claims against individual defendants of Oak and Milacron have been dismissed as well as Oak's claim for unfair competition. A hearing on Oak's motion for a preliminary injunction and Metalloid's motion for summary judgment that certain Oak information does not qualify as trade secrets was held 4 February 2004; no ruling has been made on the motions. A mediation session requested by Metalloid was held 2 April 2004. No resolution of the dispute was agreed. SCHEDULE III LOCATIONS OF GRANTORS CHIEF EXECUTIVE OFFICES
GRANTOR ADDRESS COUNTY STATE/COUNTRY - --------------------------------------------------------------------------------------------------------------------------- Milacron Inc. 2090 Florence Avenue Hamilton Ohio Cincinnati 45206 Milacron Marketing Company 2090 Florence Avenue Hamilton Ohio Cincinnati 45206 D-M-E Company 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 D-M-E U.S.A. Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 D-M-E Manufacturing Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 Uniloy Milacron Inc. 5550 Occidental Highway Lenawee Michigan Tecumseh 49286 Uniloy Milacron U.S.A. Inc. 10495 Highway M52 Washtenaw Michigan Manchester 48158 Milacron Industrial Products, Inc. 1160 White Street Joseph Michigan Sturgis 49091 Milacron Plastics Technologies Group Inc. 4165 Half Acre Road Clermont Ohio Batavia 45103 Northern Supply Company, Inc. 1901 Oakcrest Avenue Ramsey Minnesota St. Paul 55113

GRANTOR ADDRESS COUNTY STATE/COUNTRY - --------------------------------------------------------------------------------------------------------------------------- Milacron International Marketing Company 2090 Florence Avenue Hamilton Ohio Cincinnati 45206 Nickerson Machinery Chicago Inc. 10 Keith Way Norfolk Massachusetts Hingham 02043 Pliers International Inc. 10 Keith Way Norfolk Massachusetts Hingham 02043 Oak International, Inc. 1160 White Street Joseph Michigan Sturgis 49091 Cimcool Industrial Products Inc. 3000 Disney Street Hamilton Ohio Cincinnati 45209 Milacron Resin Abrasives Inc. None None None
OTHER PLACES OF BUSINESS
GRANTOR ADDRESS COUNTY STATE - ---------------------------------------------------------------------------------------------------------------------------- Milacron Marketing Company 2400 E. Katella Avenue, Suite 1068 Orange California Anaheim 92806 Milacron Marketing Company 15720 John J. Delaney Drive, Suite 370 Mecklenburg North Carolina Charlotte 28277 Milacron Marketing Company 7540 Windsor Drive, Suite 100 Lehigh Pennsylvania Allentown 18195 Milacron Marketing Company 1721 Moon Lake Boulevard, Suite 109 Cook Illinois Hoffman Estates 60194 Milacron Marketing Company 3000 Disney Street Hamilton Ohio Cincinnati 45209 Milacron Marketing Company 4165 Half Acre Road Clermont Ohio Batavia 45103 D-M-E U.S.A. Inc. 29215 Stephenson Highway Oakland Michigan Madison Heights 48071 Cimcool Industrial Products Inc. None Milacron Plastics Technologies Group None Inc. D-M-E Company None Milacron Industrial Products, Inc. None Uniloy Milacron Inc. None Uniloy Milacron U.S.A. Inc. None

GRANTOR ADDRESS COUNTY STATE - ---------------------------------------------------------------------------------------------------------------------------- D-M-E Manufacturing Inc. None Oak International, Inc. None Northern Supply Company, Inc. None Nickerson Machinery Chicago, Inc. None Pliers International Inc. None Milacron International Marketing Company None Milacron Resin Abrasives Inc. None
LOCATION OF BOOKS AND RECORDS
GRANTOR ADDRESS COUNTY STATE/COUNTRY - --------------------------------------------------------------------------------------------------------------------------- Milacron Inc. 2090 Florence Avenue Hamilton Ohio Cincinnati 45206 Milacron Marketing Company 2090 Florence Avenue Hamilton Ohio Cincinnati 45206 Milacron Marketing Company 4165 Half Acre Road Clermont Ohio Batavia 45103 Milacron Marketing Company 2085 East First Street McPherson Kansas McPherson 67460 Milacron Marketing Company 3000 Disney Street Hamilton Ohio Cincinnati 45209 D-M-E Company 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 D-M-E U.S.A. Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 D-M-E Manufacturing Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 Uniloy Milacron Inc. 5550 Occidental Highway Lenawee Michigan Tecumseh 49286 Uniloy Milacron U.S.A. Inc. 10495 Highway M52 Washtenaw Michigan Manchester 48158 Milacron Industrial Products, Inc. 1160 White Street Joseph Michigan Sturgis 49091 Milacron Industrial Products, Inc. 31003 Industrial Road Wayne Michigan Livonia 48150 Milacron Plastics Technologies Group Inc. 4165 Half Acre Road Clermont Ohio Batavia 45103

GRANTOR ADDRESS COUNTY STATE/COUNTRY - --------------------------------------------------------------------------------------------------------------------------- Northern Supply Company, Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 Milacron International Marketing Company 2090 Florence Avenue Hamilton Ohio Cincinnati 45209 Nickerson Machinery Chicago Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 Pliers International Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 Oak International, Inc. 1160 White Street Joseph Michigan Sturgis 49091 Cimcool Industrial Products, Inc. 3000 Disney Street Hamilton Ohio Cincinnati 45209 Milacron Resin Abrasives Inc. 2090 Florence Avenue Hamilton Ohio Cincinnati 45209
LOCATIONS WITH CHATTEL PAPER, INVENTORY, GOODS, EQUIPMENT AND/OR FIXTURES
GRANTOR ADDRESS COUNTY STATE/COUNTRY - ---------------------------------------------------------------------------------------------------------------------------- Milacron Marketing Company 2090 Florence Avenue Hamilton Ohio Cincinnati 45206 Milacron Marketing Company 2085 East First Street McPherson Kansas McPherson 67460 Milacron Marketing Company 4165 Half Acre Road Clermont Ohio Batavia 45103 Milacron Marketing Company 3000 Disney Street Hamilton Ohio Cincinnati 45209 D-M-E Company 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 D-M-E Company 224 Oxmoor Circle, Suite 100 Jefferson Alabama Birmingham 35209 D-M-E Company 8 Access Road Albany New York Albany 12205 D-M-E Company 558 Leo Street Montgomery Ohio Dayton 45404 D-M-E U.S.A. Inc. 6342 Ferry Avenue Charlevoix Michigan Charlevoix 49720 D-M-E U.S.A. Inc. 1117 Fairplains Street Montcalm Michigan Greenville 48838 D-M-E Company 11839 Westline Industrial Drive St. Louis Missouri St. Louis 63146 D-M-E Company 4101 E. Royalton Road Cuyahoga Ohio Broadview Heights 44147 D-M-E Company 1550 South Milliken Avenue, Suite A San Bernardino California Ontario 91761 D-M-E U.S.A. Inc. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071

GRANTOR ADDRESS COUNTY STATE/COUNTRY - ---------------------------------------------------------------------------------------------------------------------------- D-M-E Manufacturing Inc. 1975 N. 17th Avenue Cook Illinois Melrose Park 60160 D-M-E Manufacturing Inc. 977 Loop Road Mifflin Pennsylvania Lewistown 17044 D-M-E Manufacturing Inc. 70 East Hillis Street Westmoreland Pennsylvania Youngwood 15697 Uniloy Milacron U.S.A. Inc. 10495 Highway M52 Washtenaw Michigan Manchester 48158 Milacron Industrial Products, Inc. 1160 White Street Joseph Michigan Sturgis 49091 D-M-E Company 1901 Oakcrest Avenue Ramsey Minnesota St. Paul 55113 Uniloy Milacron U.S.A. Inc. 4165 Half Acre Road Clermont Ohio Batavia 45103 Uniloy Milacron Inc. 5550 Occidental Highway Lenawee Michigan Tecumseh 49286 Milacron Industrial Products, Inc. 361 Moose Lodge Road Grenada Mississippi Grenada 38901 Milacron Industrial Products, Inc. 31003 Industrial Road Wayne Michigan Livonia 48150 Milacron Marketing Company 31003 Industrial Road Wayne Michigan Livonia 48150 Milacron Plastics Technologies Group 4165 Half Acre Road Clermont Ohio Inc. Batavia 45103 Milacron Plastics Technologies Group 418 West Main Street Brown Ohio Inc. Mt. Orab 45154 Northern Supply Company, Inc. 1901 Oakcrest Avenue Ramsey Minnesota St. Paul 55113

GRANTOR ADDRESS COUNTY STATE/COUNTRY - ---------------------------------------------------------------------------------------------------------------------------- Milacron International Marketing 2090 Florence Avenue Hamilton Ohio Company Cincinnati 45209 Nickerson Machinery Chicago Inc. 10 Keith Way Norfolk Massachusetts Hingham 02043 Pliers International, Inc. 10 Keith Way Norfolk Massachusetts Hingham 02043 Oak International, Inc. 1160 White Street Joseph Michigan Sturgis 49091 Oak International, Inc. 361 Moose Lodge Road Grenada Mississippi Grenada 38901 Cimcool Industrial Products Inc. 3000 Disney Street Hamilton Ohio Cincinnati 45209 Milacron Resin Abrasives Inc. n/a n/a n/a Cimcool Industrial Products Inc. 21101 Fern Street Oakland Michigan Oak Park 48237
SCHEDULE IV DEPOSIT ACCOUNTS, SECURITIES ACCOUNTS AND COMMODITIES ACCOUNTS
Name and Address of Institution Maintaining Loan Party Account Account Number Type of Account - ----------------------------------------------------------------------------------------------------------------------- Cimcool Industrial Products U.S. Bank National 199486689 Controlled Disbursement Inc. Association P.O. Box A512 Minneapolis, MN 55480 Milacron Inc. Fifth-Third Bank 89902763 Concentration/P/R Master 38 Fountain Square Plaza Funding/FX Funding Cincinnati, OH 45263 Controlled Disbursement - P/R 73358433 Milacron Inc. Deutsche Bank Trust 50003445 Concentration/Wire - ACH Company Americas Disbursements P.O. Box 318, Church Street Station New York, NY 10008-0318 Milacron Inc. U.S. Bank National 919-9118 Miscellaneous Receipt Association Miscellaneous Disbursements P.O. Box A512 Minneapolis, MN 55480 199486705 FX and A/P Master Funding Controlled Disbursement Milacron Inc. PNC Bank, National 4076-914325 ACH Payments/Miscellaneous Association Receipts/Miscellaneous P.O. Box 821523 Disbursements Philadelphia, PA 19182 4072-247238 Disbursement - Work Comp

Name and Address of Institution Maintaining Loan Party Account Account Number Type of Account - ----------------------------------------------------------------------------------------------------------------------- Milacron Industrial Products U.S. Bank National 199465261 Controlled Disbursement Inc. Association P.O. Box A512 Minneapolis, MN 55480 Milacron Marketing Company Deutsche Bank Trust 50197657 Concentration - Receipts Company Americas P.O. Box 318, Church Street Station New York, NY 10008-0318 Milacron Marketing Company Fifth-Third Bank 74210852 Disbursement - Travel Direct 38 Fountain Square Plaza Deposit reimbursement Cincinnati, OH 45263 Milacron Marketing Company PNC Bank, National 4060-034067 Lockbox Association P.O. Box 821523 4060-153904 Lockbox / ACH Disbursements Philadelphia, PA 19182 Milacron Inc. Bank of America, N.A. 3751020268 Concentration/A/P Master File #719880 Funding - Wear Tech (WT) P.O. Box 61000 San Francisco, CA 94161 3299940314 Controlled Disbursement/WT 3750684964 Concentration/A/P Master Funding - Uniloy Milacron Marketing Company Bank One, N.A. 880823 Lockbox P.O. Box 77000 Detroit, MI 48277-0176

Name and Address of Institution Maintaining Loan Party Account Account Number Type of Account - ----------------------------------------------------------------------------------------------------------------------- Milacron Marketing Company U.S. Bank National 4801-42363 Controlled Disbursement Association P.O. Box A512 820-2384 Miscellaneous Receipt Minneapolis, MN 55480 Miscellaneous Disbursements FX Funding 199413840 Controlled Disbursement Milacron Plastics U.S. Bank National 199486697 Controlled Disbursement Technologies Group Inc. Association P.O. Box A512 Minneapolis, MN 55480 D-M-E Company U.S. Bank National 130103011016 Controlled Disbursement Association P.O. Box A512 Minneapolis, MN 55480 D-M-E Company Comerica 1850-608801 Concentration/Lockbox/A/P 500 Woodward Avenue Disbursements Detroit, MI 48226 Northern Supply Company, Inc. U.S. Bank National 8232-58561 Concentration/Deposit Account Association P.O. Box A512 Controlled Disbursement Minneapolis, MN 55480 4890-28563 Oak International, Inc. Citizens Bank 45448628 Concentration 328 South Saginaw Street Flint, MI 48502 45450194 Deposit/Disbursement 4511697791 Treasury Portfolio Sweep

Name and Address of Institution Maintaining Loan Party Account Account Number Type of Account - ----------------------------------------------------------------------------------------------------------------------- Pliers International Inc. Fleet National Bank 31810868 Concentration/Deposit/ (d/b/a Nickerson Machinery One Fleet Way Disbursement Chicago, Inc.) PA EH 0804NB Scranton, PA 18507 Uniloy Milacron Inc. Bank of America, N.A. 101174036 Controlled Disbursement File #719880 P.O. Box 61000 San Francisco, CA 94161 Uniloy Milacron U.S.A. Inc. U.S. Bank National 199-682-758 Concentration/Deposit Account Association P.O. Box A512 Minneapolis, MN 55480 Milacron Inc. Deutsche Asset Management 5000344500 Money Market Fund P.O. Box 219210 Kansas City, MO 64121 Milacron Inc. Fifth-Third Bank 45355932 Money Market Fund 34 Fountain Square Plaza Cincinnati, OH 45202 Milacron Inc. PNC Bank, National 24335 Money Market Fund Association Firstside Center 500 First Avenue Mailstop P7-PFSC-03-D Pittsburgh, PA 15219 D-M-E U.S.A. Inc. None D-M-E Manufacturing Inc. None

Name and Address of Institution Maintaining Loan Party Account Account Number Type of Account - ----------------------------------------------------------------------------------------------------------------------- ~~Nickerson Machinery Chicago, None Inc. Milacron International None Marketing Company Milacron Resin Abrasives Inc. None~~
- ----------------------- (1) This is an "Excluded Deposit Account" (as defined in the Security Agreement). (2) This is an "Excluded Deposit Account" (as defined in the Security Agreement). SCHEDULE V UCC FINANCING STATEMENTS UCC Financing Statements have been filed in the jurisdictions below against the Grantors:
NAME OF DEBTOR JURISDICTION - ----------------------------------------------------------------------------------- Milacron Inc. Delaware (central) Cimcool Industrial Products Inc. Delaware (central) Milacron Plastics Technologies Group Inc. Delaware (central) D-M-E Company Delaware (central) Milacron Industrial Products, Inc. Michigan (central) Uniloy Milacron Inc. Delaware (central) Uniloy Milacron U.S.A. Inc. Michigan (central) Milacron Marketing Company Ohio (central) D-M-E U.S.A. Inc. Michigan (central) D-M-E Manufacturing Inc. Delaware (central) Oak International, Inc. Michigan (central) Northern Supply Company, Inc. Minnesota (central) Nickerson Machinery Chicago Inc. Illinois (central) Pliers International Inc. Delaware (central) Milacron International Marketing Company Delaware (central) Milacron Resin Abrasives Inc. Delaware (central)
SCHEDULE VI COMMERCIAL TORT CLAIMS 1. MILACRON INDUSTRIAL PRODUCTS, INC. and MILACRON INC. vs. LAWRENCE A. FRANKS, NEWELL A. FRANKS, and FRED E. EDWARDS Suit brought in the Circuit Court for the County of St. Joseph, Michigan (filed on or about January 14, 2003) against the three individuals who sold Oak International, Inc. to Milacron alleging breach of a covenant of non-competition contained in the Stock Purchase Agreement and fraud related to the non-disclosure of an entity in Italy utilizing formulations of Oak International, Inc. 2. OAK INTERNATIONAL, INC. v. METALLOID CORPORATION, ET AL. Suit was brought in the Circuit Court for the County of Huntington (IN) 16 October 2002 by Oak International Inc. for trade secret misappropriation and unfair competition by Metalloid Corporation (Huntington, IN) and two former Oak International, Inc. employees. The suit seeks damages and injunctive relief. Claims against individual defendants of Oak International, Inc. and Milacron Inc. have been dismissed as well as Oak International Inc.'s claim for unfair competition. The court has granted Metalloid's request for mediation. A scheduled mediation took place on 2 April 2004 but did not result in the resolution of this matter. A hearing on Oak International Inc.'s motion for a preliminary injunction and Metalloid's motion for summary judgment that certain Oak International Inc. information does not qualify as trade secrets was held 4 February 2004; no ruling has been made on the motions. 3. MILACRON INC. v. GRAHAM ENGINEERING CORPORATION A/K/A GRAHAM MACHINERY GROUP AND HOLLO PLASTICS EQUIPMENT, INC. Suit was brought in US District Court for the Northern District of Ohio, Eastern Division (filed October 2002, served December 2002) against Graham Engineering Corporation alleging infringement of Milacron Inc.'s U.S. patent 5,062,052 relating to computer based controls for plastic molding machines. Graham is both a manufacturer and an importer (products of Hesta of Germany) of blow molding machinery. In December 2003 the court issued its ruling on interpretation of the asserted patent and ordered court-supervised mediation. No resolution has been reached through mediation. Graham filed summary judgment motions 13 February 2004 seeking rulings that the accused products do not infringe the asserted patent and that the asserted patent is invalid. EXHIBIT A IP SECURITY AGREEMENT [TRADEMARK][PATENT][COPYRIGHT] SECURITY AGREEMENT [TRADEMARKS] [PATENTS] [COPYRIGHTS] [TRADEMARK][PATENT][COPYRIGHT] SECURITY AGREEMENT ("Agreement"), dated June___, 2004, is made by _____________, a ________corporation, located at _________________ (the "Assignor") in favor of U.S. Bank National Association, a _______________, located at _______________________, as Collateral Agent (in such capacity, together with any permitted successors and assigns, "Assignee"). Capitalized terms used in this Agreement and not defined herein have the meanings set forth for such terms in the Security Agreement (as hereinafter defined). WHEREAS, Assignor is [the applicant or registrant for the trademarks and service marks listed on the annexed Schedule 1A hereto, which trademarks and service marks are registered or applied for in the United States Patent and Trademark Office (the "Trademarks")] [the patentee or applicant for the utility patents, design patents, and patent applications listed on the annexed Schedule 1A, which patents are issued or applied for in the United States Patent and Trademark Office (the "Patents")][the applicant or registrant for the copyrights listed on the annexed Schedule 1A, which copyrights are registered in the United States Copyright Office (the "Copyrights")]; WHEREAS, the Assignor has entered into a Security Agreement, dated June____, 2004, among Assignor [and the other grantors signatory thereto], and Assignee (as amended, restated, supplemented or otherwise modified from time to time, the "Security Agreement"); WHEREAS, pursuant to the Security Agreement, as collateral security for all of the Obligations, Assignor has pledged and assigned to Assignee, and granted to Assignor, for the benefit of the Agents and the Lenders (as such terms are defined in the Security Agreement) a continuing security interest in the [Trademarks, together with, among other things, the goodwill of the business symbolized by and associated with the Trademarks], [Patents], [Copyrights] and the applications and registrations thereof, and all proceeds thereof (the "Collateral"); NOW, THEREFORE, in consideration of the premises and agreements made herein and in the Security Agreement, as collateral security for all of the Obligations, Assignor hereby pledges and assigns to the Assignee, and grants to the Assignee, for the benefit of the Agents and the Lenders, a continuing security interest in the Collateral. Assignor does hereby further acknowledge and affirm that the rights and remedies of the Assignee with respect to the Collateral are more fully set forth in the Security Agreement, the terms and provisions of which are hereby incorporated herein by reference as if fully set forth herein. IN WITNESS WHEREOF, the Assignor has caused this Agreement to be executed and delivered by its officer thereunto duly authorized as of the date above first written. [GRANTOR] By:______________________________________ Name: Title: STATE OF ____________ ss.: COUNTY OF __________ On this ____ day of June, 2004, before me personally came ________________, to me known to be the person who executed the foregoing instrument, and who, being duly sworn by me, did depose and say that s/he is the ________________ of _______________________________________, a ____________________, and that s/he executed the foregoing instrument in the name of _______________________________________, and that s/he had authority to sign the same, and s/he acknowledged to me that he executed the same as the act and deed of said entity for the uses and purposes therein mentioned. _____________________________ Notary Public SCHEDULE 1A TO [TRADEMARK][PATENT][COPYRIGHT] SECURITY AGREEMENT [Trademark Registrations and Trademark Applications] [Patents and Patent Applications] [Copyright Registrations and Copyright Applications] EX-4.7 50 y98028exv4w7.txt SECURITY AGREEMENT EXHIBIT 4.7 SECURITY AGREEMENT SECURITY AGREEMENT, dated June 10, 2004, made by each of the Grantors referred to below, in favor of U.S. Bank National Association, in its capacity as Collateral Agent for the Trustee and the Holders (as such terms are defined below) pursuant to the Indenture referred to below (in such capacity, together with any permitted successors and assigns, the "Collateral Agent"). W I T N E S S E T H: WHEREAS, Milacron Inc., a Delaware corporation (the "Company"), each subsidiary of the Company listed as a "Guarantor" on the signature pages of the supplemental indenture dated the date hereof to the Indenture (each such subsidiary which is a Canadian Restricted Subsidiary, a "Grantor" and collectively, the "Grantors"), the Collateral Agent and U.S. Bank National Association, in its capacity as trustee (in such capacity, together with any permitted successors and assigns, the "Trustee") are parties to an indenture, dated as of May 26, 2004 (as amended, restated, supplemented or otherwise modified from time to time, being hereinafter referred to as the "Indenture"), with respect to the Company's 11-1/2% Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, the Company has issued the Notes to the Holders; WHEREAS, it is a condition to the release to the Company from the Escrow Account of the proceeds from the offering of the Notes that each Grantor shall execute and deliver this Agreement; WHEREAS, the Grantors are mutually dependent on each other in the conduct of their respective businesses as an integrated operation, with the credit needed from time to time by each Grantor often being provided through financing obtained by the other Grantors and the ability to obtain such financing being dependent on the successful operations of all of the Grantors as a whole; and WHEREAS, each Grantor has determined that the execution, delivery and performance of this Agreement directly benefits, and are in the best interest of, such Grantor; NOW, THEREFORE, in consideration of the premises and the agreements herein, the Grantors hereby jointly and severally agree with the Collateral Agent, for the benefit of the Trustee and Holders, as follows: ARTICLE 1 DEFINITIONS. (a) Reference is hereby made to the Indenture for a statement of the terms thereof. All terms used in this Agreement and the recitals hereto which are defined in the Indenture or in the Personal Property Security Act (Ontario), as in effect from time to time (the "PPSA") and which are not otherwise defined herein shall have the same meanings herein as set forth therein; provided that terms used herein which are defined in the PPSA as in effect on the date hereof shall continue to have the same meaning notwithstanding any replacement or amendment of such statute except as the Collateral Agent may otherwise determine. (b) The following terms shall have the respective meanings provided for in the PPSA: "Account", "Chattel Paper", "Document of Title", "Intangible", "Instrument", "Inventory", "Security", "Proceeds", "Money", "financing statement" and "financing change statement". (c) As used in this Agreement, the following terms shall have the respective meanings indicated below, such meanings to be applicable equally to both the singular and plural forms of such terms: "Collateral" has the meaning given to it in ARTICLE 2(a), and any reference herein to "Collateral" shall, unless the context otherwise requires, be deemed a reference to "Collateral or any part thereof". "Discharge of Senior Secured Note Obligations" means the payment in full of the Senior Secured Note Obligations that are outstanding and unpaid at the time the Notes are paid in full. "Excluded Accounts" means: (i) deposit accounts for which the Collateral Agent is the depositary and (ii) deposit accounts specially and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of a Grantor's salaried employees. "Holder" means a Person in whose name a Note is registered. "Material Adverse Effect" means a material adverse effect on the condition (financial or other), business, properties or results of operations of the Grantors and their respective subsidiaries taken as a whole. "Receiver has the meaning given to it in ARTICLE 7(a) "Restricted Cash" means any cash or cash equivalents permitted to be deposited or pledged under clause (7), (12) or (14) of the definition of "Permitted Liens" in the Indenture. ARTICLE 2 GRANT OF SECURITY INTEREST. (a) As collateral security for all of the Senior Secured Note Obligations, each Grantor hereby pledges and assigns to the Collateral Agent, and grants to the Collateral Agent, for the benefit of the Trustee and the Holders, a continuing security interest in the following personal property of such Grantor, wherever located and whether now or hereafter existing and whether now owned or hereafter acquired, of every kind and description, tangible or intangible (the "Collateral"): (i) all Accounts, claims, choses in action and demands of every nature and kind howsoever arising or secured, including letters of credit and advices of credit, which are 2 now due, owing or accruing or growing due to or owned by or which may hereafter become due, owing or accruing or growing due to or owned by such Grantor; (ii) all Chattel Paper (whether tangible or electronic); (iii) all Instruments; (iv) all Inventory; (v) (a) all deposit accounts and Money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein and (b) all Securities, security entitlements, and securities accounts, in each case, to the extent constituting cash or cash equivalents or representing a claim to cash equivalents, except the cash management and lockbox account specified in the ABL Facility; (vi) all proceeds, products, offspring, accessions, rents, profits, income, benefits, substitutions and replacements of and to any of the property of such Grantor described in the preceding clauses of this ARTICLE 2(a) (including, without limitation, any proceeds of insurance thereon and all causes of action, claims and warranties now or hereafter held by such Grantor in respect of any of the items listed above), and all books, correspondence, files and other records, including, without limitation, all tapes, disks, cards, software, data and computer programs in the possession or under the control of such Grantor or any other Person from time to time acting for such Grantor that at any time evidence or contain information relating to any of the property described in the preceding clauses of this ARTICLE 2(a) or are otherwise necessary or helpful in the collection or realization thereof; and (vii) all Proceeds, and products of all Proceeds, and renewals thereof, accretions to, substitutions for, and products of, any and all of the foregoing Collateral. in each case howsoever such Grantor's interest therein may arise or appear (whether by ownership, security interest, claim or otherwise). (b) If the Collateral is realized upon and the security interest in the Collateral is not sufficient to satisfy all the Senior Secured Note Obligations, each Grantor acknowledges and agrees that such Grantor shall continue to be liable for any Senior Secured Note Obligations remaining outstanding and the Collateral Agent shall be entitled to pursue full payment thereof. (c) Nothing in this Agreement shall constitute an assignment or attempted assignment of any agreement which by its provisions or by law is not assignable or which requires the consent of a third party to its assignment unless such consent has been obtained. In each such case, the applicable Grantor shall, unless the Collateral Agent otherwise agrees in writing, promptly, upon written request by the Collateral Agent, attempt to obtain the consent of any necessary third party to its assignment under this Agreement and to its further assignment by the lender to any third party as a result of the exercise by the Collateral Agent of remedies after demand. Upon such consent being obtained or waived, this Agreement shall apply to the applicable agreement without regard to this section and without the necessity of any further assurance to effect such assignment. Unless and until the consent to assignment is obtained as provided above, the applicable Grantor shall, to the extent it may do so at law or pursuant to the 3 interest in question hold all benefit to be derived from such agreements in trust for the Collateral Agent (including, without limitation, such Grantor's beneficial interest in any agreement which may be held in trust for such Grantor by a third party), as additional security for payment of the Senior Secured Note Obligations and shall deliver up all such benefit to the Collateral Agent, promptly upon demand by the Collateral Agent. ARTICLE 3 SECURITY FOR SENIOR SECURED NOTE OBLIGATIONS. The security interest created hereby in the Collateral constitutes continuing collateral security for the Senior Secured Note Obligations. ARTICLE 4 REPRESENTATIONS AND WARRANTIES Each Grantor jointly and severally represents and warrants as follows (it being understood and agreed that, to the extent any Schedule hereto is required to be supplemented pursuant to ARTICLE 5 to reflect any change in facts or circumstances after the date hereof and such Schedule is supplemented for such change in accordance with ARTICLE 5, such Schedule shall be deemed supplemented to reflect such change in facts or circumstances from time to time of such change for all purposes of this ARTICLE 4: (a) Schedule I hereto sets forth the exact legal name of each Grantor, including any French language version of its incorporated name. (b) Each Grantor (i) is a corporation, limited liability company or limited partnership duly organized, validly existing and in good standing under the laws of its respective jurisdiction of organization as set forth on Schedule I hereto, (ii) has all requisite power and authority to conduct its business as now conducted and as presently contemplated and to execute, deliver and perform this Agreement and each other Senior Secured Note Document to be executed and delivered by it pursuant hereto and to consummate the transactions contemplated hereby and thereby, and (iii) is duly qualified to do business and is in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary, except where the absence of any such qualification could not reasonably be expected to result in a Material Adverse Effect. (c) The execution, delivery and performance by each Grantor of this Agreement and each other Senior Secured Note Document to which such Grantor is or will be a party (i) have been duly authorized by all necessary action, (ii) do not and will not contravene its constating documents or by-laws, its limited liability company or operating agreement or its certificate of partnership or partnership agreement, as applicable, or any material applicable law or any material contractual restriction binding on or otherwise affecting such Grantor or any of its properties, (iii) do not and will not result in or require the creation of any Lien (other than pursuant to any Senior Secured Note Document) upon or with respect to any of its properties, other than Liens securing obligations in an aggregate amount not exceeding $100,000 and (iv) do not and will not result in any default, noncompliance, suspension, revocation, impairment, 4 forfeiture or nonrenewal of any material permit, license, authorization or approval applicable to it or its operations or any of its properties. (d) This Agreement is, and each other Senior Secured Note Document to which any Grantor is or will be a party, when executed and delivered, will be, a legal, valid and binding obligation of such Grantor, enforceable against such Grantor in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. (e) There is no pending or, to the best knowledge of any Grantor, threatened action, suit or proceeding affecting any Grantor or its properties, before any court or other governmental authority or any arbitrator, or any order, judgment or award by any governmental authority or arbitrator, that could reasonably be expected to materially affect the grant by any Grantor, or the perfection, of the security interest purported to be created hereby in the Collateral, or the exercise by the Collateral Agent of any of its rights or remedies hereunder. (f) All federal, provincial, and material local and foreign tax returns and other reports required by applicable law to be filed by any Grantor have been filed, or extensions have been obtained, and all taxes, assessments and other governmental charges imposed upon any Grantor or any property of any Grantor and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $100,000 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves have been set aside for the payment thereof on the most recently available consolidated financial statements of the Company to the extent required by and in accordance with GAAP. (g) All Inventory now existing and constituting Collateral is located and/or based at the addresses specified therefor in Schedule II hereto (as amended, supplemented or otherwise modified from time to time in accordance with the terms hereof), other than Inventory in transit between any such locations and Inventory that has been sold (including sales on consignment or approval in the ordinary course of business) and each Grantor's chief executive office, principal place of business, domicile (within the meaning of the Civil Code of Quebec), registered office according to its constating documents, corporate offices, the locations of all of its books and records concerning the Collateral and all Account Debtors, and all originals of all Chattel Paper are located at the addresses specified therefor in Schedule II hereto; provided that Schedule II hereto shall not contain any name or location of any Person (other than a Grantor) having possession of any Inventory, records or other assets having an aggregate book value of less than $25,000. As of the date hereof, none of the Accounts are evidenced by promissory notes or other Instruments. Set forth in Schedule III hereto is a complete and accurate list, as of the date of this Agreement, of each bank account, Securities Account and commodities account located in Canada of each Grantor, together with the name and address of each institution at which each such account is maintained, the account number for each such account and a description of the purpose of each such account. (h) INTENTIONALLY DELETED. 5 (i) INTENTIONALLY DELETED. (j) The Grantors are and will be at all times the sole and exclusive owners of, or otherwise have and will have adequate rights in, the Collateral free and clear of any Lien except for (i) the Lien created by this Agreement, (ii) unpaid suppliers' rights to repossess Inventory purchased by such Grantors under Section 81.1 of the Bankruptcy and Insolvency Act (Canada) and such suppliers' substantially similar rights under the Civil Code of Quebec, and (ii) the Permitted Prior Liens. No effective financing statement or other instrument similar in effect covering all or any part of the Collateral is on file in any recording or filing office except (A) such as may have been filed in favor of the Collateral Agent relating to this Agreement and (B) such as may have been filed to perfect or protect any Permitted Prior Lien. (k) The exercise by the Collateral Agent of any of its rights and remedies expressly enumerated in this Agreement, subject to the terms of the Intercreditor Agreement and the rights of Persons holding Permitted Prior Liens, will not contravene any law or any material contractual restriction binding on or otherwise affecting any Grantor or any of its material properties and will not result in, or require the creation of, any Lien upon or with respect to any of its properties. (l) No consent, authorization or approval or other action by, and no notice to or filing with, any governmental authority is required for (i) the grant by any Grantor, or the perfection, of the security interest purported to be created hereby in the Collateral or (ii) the exercise by the Collateral Agent of any of its rights and remedies expressly enumerated in this Agreement except (A) for the filing under the PPSA as in effect in the applicable jurisdiction of the financing statements as described in Schedule III hereto, all of which financing statements, filings and other recordings, as applicable, have been duly filed and are in full force and effect, (B) with respect to any action that may be necessary to obtain control of Collateral described in ARTICLE 5(i) hereof, the taking of such actions (C) the taking possession of all Chattel Paper, Instruments and cash constituting Collateral, and (D) to the extent applicable, as may be required in connection with any sale of any Collateral by laws affecting the offering and sale of Securities generally other than those that have been obtained or made and are in full force and effect. (m) INTENTIONALLY DELETED. (n) This Agreement creates in favor of the Collateral Agent for the benefit of the Trustee and the Holders a legal, valid and enforceable security interest in the Collateral, as security for the Senior Secured Note Obligations. The Credit Facility Agent having possession, as bailee for the Collateral Agent pursuant to the terms of the Intercreditor Agreement, of all Instruments and Chattel Paper and cash constituting Collateral results in the perfection of such security interests, to the extent governed by the PPSA. To the extent governed by the PPSA, such security interests are, or in the case of Collateral in which any Grantor obtains rights after the date hereof, will be, perfected security interests, subject only to the Permitted Prior Liens that are prior to Liens in favor of the Collateral Agent, for the benefit of the Trustee and the Holders, and the recording of such instruments of assignment or amendment. All such recordings and filings and all other actions necessary or desirable to perfect and protect such security interest have been duly taken, except for (i) the Collateral Agent's having possession of Instruments and Chattel Paper and cash (other than Restricted Cash) constituting Collateral after the date hereof, and (ii) the other filings and recordations described in ARTICLE 4(l) hereof. 6 ARTICLE 5 COVENANTS AS TO THE COLLATERAL Until the Discharge of the Senior Secured Note Obligations, unless the Collateral Agent shall otherwise consent in writing: (a) Further Assurances. Each Grantor will at its expense, at any time and from time to time, promptly execute and deliver all further instruments and documents (including titles of indebtedness and deeds of hypothec with respect to Collateral located in the Province of Quebec) and take all further action that the Collateral Agent may determine to be reasonably necessary or desirable to (i) perfect and protect the security interest purported to be created hereby; (ii) enable the Collateral Agent to exercise and enforce its rights and remedies hereunder in respect of the Collateral; or (iii) otherwise effect the purposes of this Agreement, including, without limitation: (A) from and after the date upon which the Discharge of Credit Facility Obligations has occurred, marking conspicuously all Chattel Paper (to the extent such Chattel Paper is not in the possession of the Collateral Agent) with a legend, in form and substance reasonably satisfactory to the Collateral Agent, indicating that such Chattel Paper is subject to the security interest created hereby, (B) from and after the date upon which the Discharge of Credit Facility Obligations has occurred, delivering and pledging to the Collateral Agent hereunder all Collateral consisting of certificated Securities, Chattel Paper and Instruments, in each case, duly endorsed and accompanied by executed (in blank) instruments of transfer or assignment, all in form and substance reasonably satisfactory to the Collateral Agent, (C) executing and filing (to the extent, if any, that such Grantor's signature is required thereon) or authenticating the filing of, such financing or financing change statements, or amendments thereto, as the Collateral Agent may determine to be reasonably necessary or desirable to perfect and preserve the security interest purported to be created hereby, (D) furnishing to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Collateral Agent may reasonably request, all in reasonable detail, and (E) if any Collateral shall be in the possession of a third party, notifying such Person of the Collateral Agent's security interest created hereby and using its reasonable efforts to obtain a landlord waiver or bailee letter or such other written acknowledgment from such Person that such Person holds possession of the Collateral for the benefit of the Collateral Agent, which such written acknowledgment shall be in form and substance reasonably satisfactory to the Collateral Agent, provided that, such Grantor's obligation to obtain such landlord waiver, bailee letter or other written acknowledgement shall only be applicable from and after the date upon which the Discharge of Credit Facility Obligations has occurred. (b) Location of Inventory. Each Grantor will keep the Inventory (other than Inventory sold in the ordinary course of business in accordance with ARTICLE 5(g) hereof and Inventory not required to be at such location pursuant to ARTICLE 4(g) hereof) at one or more of the locations specified therefor in Section ARTICLE 4(g) hereof or, upon not less than thirty (30) days' prior written notice to the Collateral Agent accompanied by a new Schedule II hereto indicating each new location of the Inventory with an aggregate book value exceeding $100,000, at such other locations in Canada as the Grantors may elect, provided that (i) all action has been taken to grant to the Collateral Agent a perfected security interest in such Inventory (subject only to Permitted Prior Liens and Credit Facility Liens that are held by the Collateral Agent, for the benefit of the Trustee and the Holders, and (ii) the Collateral Agent's rights in such Inventory, 7 including, without limitation, the existence, perfection and priority of the security interest created hereby in such Inventory, are not adversely affected thereby. (c) INTENTIONALLY DELETED (d) Taxes, Etc. (i) Each Grantor jointly and severally agrees to pay promptly when due all property and other taxes, assessments and governmental charges or levies imposed upon, and all claims (including claims for labor, materials and supplies) against, the equipment and Inventory, except to the extent the validity thereof is being contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, in accordance with GAAP have been set aside for the payment thereof. (ii) Without limiting any of the Grantors' other obligations under any other Senior Secured Note Document, and for greater certainty, each Grantor agrees to pay and remit to the Canada Revenue Agency and any other applicable Governmental Authority when due all Canadian withholding taxes exigible in respect of any transfers from any bank accounts pledged in favour of the Collateral Agent. Upon request from the Collateral Agent, each Grantor shall provide to the Collateral Agent the original or a certified copy of a receipt evidencing such payment or, if such taxes are not exigible on any such transfer, a reasonably detailed explanation (with reference to the type of intercompany transaction to which the transfer/payment relates) therefor. (e) Insurance. (i) Each Grantor will, at its own expense: (A) keep its properties adequately insured at all times by responsible and reputable insurers; (B) maintain such other insurance, to such extent and against such risks (and with such deductibles, retentions and exclusions), including fire and other risks insured against by extended coverage and coverage for acts of terrorism, as is customary with companies in the same or similar businesses operating in the same or similar locations, including public liability insurance against claims for personal injury or death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled by it; (C) maintain such other insurance as may be required by law provided, however, that each Grantor may maintain self-insurance (which shall include insurance maintained through Milacron Assurance Ltd., a Bermuda company) in connection with the above insurance requirements to the extent, reasonably prudent and consistent with past practice. In addition, (A) each such liability policy (other than any Director's and Officer's 8 liability policy and any Fiduciary Responsibility liability policy) shall name each Grantor and the Collateral Agent (and such other Persons as the Collateral Agent may designate from time to time) as additional insured thereunder (without any representation or warranty by or obligation upon the Collateral Agent or such other Person) as their interests may appear and each property policy shall name each Grantor and the Collateral Agent as loss payees as their interests may appear, (B) each property policy shall contain an agreement by the insurer that any loss thereunder shall be payable to the Collateral Agent on its own account notwithstanding any action, inaction or breach of representation or warranty by any Grantor, (C) each such policy shall provide that there shall be no recourse against the Collateral Agent for payment of premiums or other amounts with respect thereto and (D) each such policy shall provide that at least thirty (30) days' prior written notice of cancellation, lapse, expiration or other adverse change shall be given to the Collateral Agent by the insurer. Each Grantor will, if so requested by the Collateral Agent, deliver to the Collateral Agent certificates of insurance evidencing such insurance and, as often as the Collateral Agent may reasonably request, a report of a reputable insurance broker with respect to such insurance. Each Grantor will also, at the request of the Collateral Agent, execute and deliver instruments of assignment of such insurance policies and cause the respective insurers to acknowledge notice of such assignment. (ii) Reimbursement under any liability insurance maintained by any Grantor pursuant to this ARTICLE 5(e) may be paid directly to the Person who shall have incurred liability covered by such insurance. (f) Provisions Concerning Certain Accounts (i) No Grantor shall, without notice to the Collateral Agent, change (A) such Grantor's name, identity or organizational structure or (B) its jurisdiction of incorporation as set forth in ARTICLE 4(b) hereto. Each Grantor shall keep adequate records concerning the Accounts and Chattel Paper and permit representatives of the Collateral Agent upon reasonable prior notice and during normal business hours, to inspect and make abstracts from such records and Chattel Paper. (ii) Each Grantor will, except as otherwise provided in this ARTICLE 5(f), continue to collect, at its own expense, all amounts due or to become due under the Accounts. In connection with such collections, each Grantor may (and, at the Collateral Agent's (or its agent) direction, will) take such action as such Grantor or the Collateral Agent may deem reasonably necessary or advisable to enforce collection or performance of the Accounts; provided, however, that the Collateral Agent (or its agent) shall have the right at any time, following the date upon which the Discharge of Credit Facility Obligations has occurred, upon the occurrence and during the continuance of an Event of Default, to notify the Account Debtors or obligors under any Accounts of the assignment of such Accounts to the Collateral Agent (or its agent) and to direct such Account Debtors or obligors to make payment of all amounts due or to become due to such Grantor thereunder directly to the Collateral Agent or its designated agent and, upon such notification and at the expense of such Grantor and to the extent permitted by law, to enforce collection of any such Accounts and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done. After receipt by any Grantor of a notice from the Collateral Agent that the Collateral Agent has notified, intends to notify, or has enforced or intends to enforce a Grantor's rights against the 9 Account Debtors or obligors under any Accounts as referred to in the proviso to the immediately preceding sentence, (A) all amounts and proceeds (including Instruments) received by such Grantor in respect of the Accounts shall be received in trust for the benefit of the Collateral Agent hereunder, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Collateral Agent or its designated agent in the same form as so received (with any necessary endorsement) to be held as cash collateral and if an Event of Default shall have occurred and be continuing, applied as specified in ARTICLE 7(j) hereof, and (B) such Grantor will not adjust, settle or compromise the amount or payment of any Account or release wholly or partly any Account Debtor or obligor thereof or allow any credit or discount thereon. In addition, following the date upon which the Discharge of Credit Facility Obligations has occurred, upon the occurrence and during the continuance of an Event of Default, the Collateral Agent (or its agent) may (in its sole and absolute discretion) direct any or all of the banks and financial institutions with which any Grantor either maintains a deposit account or a lockbox or deposits the proceeds of any Accounts to send immediately to the Collateral Agent or its designated agent by wire transfer (to such cash management accounts as the Collateral Agent shall specify, or in such other manner as the Collateral Agent shall direct) all or a portion of such securities, cash, investments and other items held by such institution. Any such securities, cash, investments and other items so received by the Collateral Agent or its designated agent shall (in the sole and absolute discretion of the Collateral Agent or such designated agent) be held as additional Collateral for the Senior Secured Note Obligations or distributed in accordance with ARTICLE 7 hereof. (g) Transfers and Other Liens. (i) Except to the extent not prohibited by Section 4.10 of the Indenture, no Grantor will sell, assign (by operation of law or otherwise), lease, license, exchange or otherwise transfer or dispose of any of the Collateral. (ii) Except to the extent not prohibited by Section 4.12 of the Indenture, no Grantor will create, suffer to exist or grant any Lien upon or with respect to any Collateral. (h) INTENTIONALLY DELETED (i) Deposit, Commodities and Securities Accounts. Each Grantor shall cause each bank and other financial institution with an account referred to in Schedule IV hereto to execute and deliver to the Collateral Agent (or its agent) a control agreement, in form and substance reasonably satisfactory to the Collateral Agent, duly executed by such Grantor and such bank or financial institution, or enter into other arrangements in form and substance satisfactory to the Collateral Agent, pursuant to which such institution shall irrevocably agree (except to the extent otherwise agreed to by the Trustee and the Holders), among other things, that (i) it will comply at any time with the instructions originated by the Collateral Agent (or its agent) to such bank or financial institution directing the disposition of cash, commodity contracts, Securities, and other items from time to time credited to such account, without further consent of such Grantor, which instructions the Collateral Agent (or its agent) will not give to such bank or other financial institution in the absence of a continuing Event of Default, (ii) all cash, commodity contracts, Securities, and other items of such Grantor deposited with such institution shall be subject to a perfected, [first priority] security interest in favor of the Collateral Agent (or its agent), (iii) any 10 right of set off, banker's Lien or other similar Lien, security interest or encumbrance shall be fully waived as against the Collateral Agent (or its agent), and (iv) such bank or financial institution shall immediately send to the Collateral Agent (or its agent) by wire transfer (to such account as the Collateral Agent (or its agent) shall specify, or in such other manner as the Collateral Agent (or its agent) shall direct) all such cash, the value of any commodity contracts, Securities, and other items held by it. The Collateral Agent agrees with each of the Grantors that in respect of any control agreement that provides for shared control between the Collateral Agent and a Grantor in respect of any deposit account, commodity account or Securities Account, the Collateral Agent (or its agent) shall not deliver to the bank or financial institution a notice of exclusive control in respect of such deposit account, commodity account or Securities Account unless there is an occurrence and continuance of an Event of Default. The Collateral Agent further agrees with each of the Grantors to withdraw any such notice of exclusive control as soon as practicable upon such Event of Default ceasing to exist. Without the prior written consent of the Collateral Agent (or its agent), no Grantor shall make or maintain any deposit account, commodity account or Securities Account except for the accounts set forth in Schedule IV hereto. The provisions of this ARTICLE 5(i) shall not apply to Excluded Accounts or, until the date upon which the Discharge of Credit Facility Obligations has occurred, any other Collateral. (j) INTENTIONALLY DELETED. (k) Inspection and Reporting. Each Grantor shall permit the Collateral Agent, or any agents or representatives thereof or such professionals or other Persons as the Collateral Agent may reasonably designate, subject to a confidentiality agreement reasonably satisfactory to the Company upon reasonably prior notice and during normal business hours (i) to examine and make copies of and abstracts from such Grantor's records and books of account, (ii) to visit and inspect its properties, (iii) to verify materials, leases, notes, Accounts, Inventory and other assets comprising the Collateral of such Grantor from time to time and (iv) to conduct audits, physical counts, appraisals and/or valuations or examinations at the locations of such Grantor. ARTICLE 6 ADDITIONAL PROVISIONS CONCERNING THE COLLATERAL. (a) Each Grantor hereby (i) authorizes the Collateral Agent to file, one or more financing or financing change statements relating to the Collateral and (ii) ratifies such authorization to the extent that the Collateral Agent has filed any such financing or financing change statements prior to the date hereof. A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement or for recordal purposes where permitted by law. (b) Each Grantor hereby irrevocably appoints the Collateral Agent as its attorney-in-fact and proxy, with full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, and upon the occurrence and during the continuance of an Event of Default, the Collateral Agent may take any action and execute any instrument which the Collateral Agent may deem reasonably necessary or advisable to accomplish the purposes of this Agreement (subject to the rights of a Grantor under ARTICLE 5 hereof), including, without limitation, (i) to ask, demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneys due and to become due under or in respect of any Collateral, (ii) to 11 receive, endorse, and collect any drafts or other instruments, documents and chattel paper in connection with clause (i) above, (iii) to file any claims or take any action or institute any proceedings which the Collateral Agent, the Trustee or the Holders may deem necessary or desirable for the collection of any Collateral or otherwise to enforce the rights of the Trustee and the Holders with respect to any Collateral, and (v) to execute assignments, licenses and other documents to enforce the rights of the Trustee and the Holders with respect to any Collateral. This power is coupled with an interest and is irrevocable until the date on which the Discharge of Senior Secured Note Obligations has occurred. (c) If any Grantor fails to perform any agreement contained herein, the Collateral Agent may itself perform, or cause performance of, such agreement or obligation, in the name of such Grantor or the Collateral Agent, and the expenses of the Collateral Agent incurred in connection therewith shall be jointly and severally payable by the Grantors pursuant to ARTICLE 8 hereof and shall be secured by the Collateral. (d) The powers conferred on the Collateral Agent hereunder are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except for the safe custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Collateral Agent shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral. ARTICLE 7 REMEDIES UPON DEFAULT (a) Upon the occurrence of and during the continuance of any Event of Default, the Collateral Agent may appoint or reappoint by instrument in writing, any Person or Persons, whether an officer or officers or an employee or employees of the Collateral Agent or not, to be an interim receiver, receiver or receivers (hereinafter called a "Receiver", which term when used herein shall include a receiver and manager) of the Collateral (including any interest, income or profits therefrom) and may remove any Receiver so appointed and appoint another in its stead. Any such Receiver shall, so far as concerns responsibility for its acts, be deemed the agent of the Grantors and not of the Collateral Agent, and the Collateral Agent shall not be in any way responsible for any misconduct, negligence or non-feasance on the part of any such Receiver or its servants, agents or employees. Subject to the provisions of the instrument appointing it, any such Receiver shall have power to take possession of the Collateral, to preserve the Collateral or its value, to carry on or concur in carrying on all or any part of the business of any Grantor and to sell, lease, license or otherwise dispose of or concur in selling, leasing, licensing or otherwise disposing of the Collateral. To facilitate the foregoing powers, any such Receiver may, to the exclusion of all others, including the Grantors, enter upon, use and occupy all premises owned or occupied by any Grantor wherein the Collateral may be situate, maintain the Collateral upon such premises, borrow money on a secured or unsecured basis and use the Collateral directly in carrying on any Grantor's business or as security for loans or advances to enable the Receiver to carry on any Grantor's business or otherwise, as such Receiver shall, in its discretion, determine. Except as may be otherwise directed by the Collateral Agent, all Money received from time to time by such Receiver in carrying out its appointment shall be received in trust for and be paid over to the Collateral Agent. Every such Receiver may, in the discretion of the Collateral Agent, 12 be vested with all or any of the rights and powers of the Collateral Agent. The identity of the Receiver, its replacement and its remuneration shall be within the sole and unfettered discretion of the Collateral Agent. (b) Upon the occurrence of and during the continuance of any Event of Default, the Collateral Agent may, either directly or through its agents or nominees, exercise any or all of the powers and rights given to a Receiver by virtue of ARTICLE 7(a). (c) In addition to those rights granted herein and in any other agreement now or hereafter in effect between any Grantor and the Collateral Agent, and in addition to any other rights the Collateral Agent may have at law or in equity, the Collateral Agent shall have, both before and after the occurrence of any Event of Default, all rights and remedies of a secured party under the PPSA. However, the Collateral Agent shall not be liable or accountable for any failure to exercise its remedies, take possession of, collect, enforce, realize, sell, lease, license or otherwise dispose of the Collateral or to institute any proceedings for such purposes. Furthermore, the Collateral Agent shall have no obligation to take any steps to preserve rights against prior parties to any Instrument or Chattel Paper, whether Collateral or proceeds and whether or not in the Collateral Agent's possession, and shall not be liable or accountable for failure to do so. (d) Upon the occurrence of and during the continuance of any Event of Default, the Collateral Agent may take possession of, collect, demand, sue on, enforce, recover and receive the Collateral and give valid and binding receipts and discharges therefor and in respect thereof and the Collateral Agent also may sell, license, lease or otherwise dispose of the Collateral in such manner, at such time or times and place or places, for such consideration and upon such terms and conditions as to the Collateral Agent may seem reasonable and in compliance with applicable law. (e) Each Grantor acknowledges that, upon the occurrence of and during the continuance of any Event of Default, the Collateral Agent or any Receiver appointed by it may take possession of the Collateral wherever it may be located and by any method permitted by law and each Grantor agrees upon request from the Collateral Agent or any such Receiver to assemble and deliver possession of the Collateral at such place or places as directed. (f) The Collateral Agent will give Grantor such notice, if any, of the date, time and place of any public sale or of the date after which any private disposition of the Collateral is to be made as may be required by the PPSA. (g) Each Grantor hereby acknowledges that if the Collateral Agent complies with any applicable provincial or federal law requirements in connection with a disposition of the Collateral, such compliance will not adversely affect the commercial reasonableness of any sale or other disposition of the Collateral. (h) Each Grantor agrees to be liable for and to pay all costs, charges and expenses reasonably incurred by the Collateral Agent or any Receiver appointed by the Collateral Agent, whether directly or for services rendered (including reasonable legal and auditors' costs and expenses and Receiver remuneration), in operating such Grantor's accounts, in preparing or 13 enforcing this Agreement, taking and maintaining custody of, preserving, repairing, processing, preparing for disposition and disposing of the Collateral and in enforcing or collecting indebtedness and all such costs, charges and expenses, together with any amounts owing as a result of any borrowing by the Collateral Agent or any Receiver appointed by the Collateral Agent, as permitted hereby, shall be a first priority security interest on the proceeds of realization, collection or disposition of the Collateral and shall be secured hereby. (i) To the maximum extent permitted by applicable law, each Grantor waives all claims, damages and demands against the Collateral Agent or any Receiver appointed by the Collateral Agent arising out of the repossession, retention or sale of the Collateral except such as arise solely out of the gross negligence or wilful misconduct of the Collateral Agent or any Receiver appointed by the Collateral Agent as finally determined by a court of competent jurisdiction. (j) Any cash held by the Collateral Agent as Collateral and all cash Proceeds received by the Collateral Agent in respect of any sale of or collection from, or other realization upon, all or any part of the Collateral may, in the discretion of the Collateral Agent, be held by the Collateral Agent as collateral for, and/or then or at any time thereafter applied (after payment of any amounts payable to the Collateral Agent pursuant to ARTICLE 8 hereof) in whole or in part by the Collateral Agent against, all or any part of the Senior Secured Note Obligations in such order as the Collateral Agent shall elect, consistent with the provisions of the Indenture. Any surplus of such cash or cash Proceeds held by the Collateral Agent and remaining after the date on which the Discharge of Senior Secured Note Obligations has occurred shall be paid over to whomsoever shall be lawfully entitled to receive the same or as a court of competent jurisdiction shall direct. (k) In the event that the proceeds of any such sale, collection or realization are insufficient to pay all amounts to which the Trustee and the Holders are legally entitled, the Grantors shall be jointly and severally liable for the deficiency, together with interest thereon at the highest rate specified in any applicable Senior Secured Note Document for interest on overdue principal thereof or such other rate as shall be fixed by applicable law, together with the reasonable out-of-pocket costs of collection and the reasonable fees, costs, expenses and other client charges of any attorneys employed by the Collateral Agent to collect such deficiency. (l) The Collateral Agent shall not be required to marshal any present or future collateral security (including, but not limited to, this Agreement and the Collateral) for, or other assurances of payment of, the Senior Secured Note Obligations or any of them or to resort to such collateral security or other assurances of payment in any particular order, and all of the Collateral Agent's rights hereunder and in respect of such collateral security and other assurances of payment shall be cumulative and in addition to all other rights, however existing or arising. To the extent that any Grantor lawfully may, such Grantor hereby agrees that it will not invoke any law relating to the marshalling of collateral which might cause delay in or impede the enforcement of the Collateral Agent's rights under this Agreement or under any other instrument creating or evidencing any of the Senior Secured Note Obligations or under which any of the Senior Secured Note Obligations is outstanding or by which any of the Senior Secured Note Obligations is secured or payment thereof is otherwise assured, and, to the extent that it lawfully may, each Grantor hereby irrevocably waives the benefits of all such laws. 14 ARTICLE 8 INDEMNITY AND EXPENSES. (a) Each Grantor jointly and severally agrees to defend, protect, indemnify and hold harmless the Collateral Agent and the Trustee (and all of their respective officers, directors, employees, attorneys, consultants and agents) from and against any and all claims, damages, losses, liabilities, obligations, penalties, fees and reasonable out-of-pocket costs and expenses (including, without limitation, reasonable legal fees, costs, expenses and disbursements of counsel for the Collateral Agent and the Trustee) to the extent that they arise out of or otherwise result from this Agreement (including, without limitation, enforcement of this Agreement), except claims, losses or liabilities resulting solely and directly from such Person's gross negligence or willful misconduct, as determined by a final judgment of a court of competent jurisdiction. (b) Each Grantor jointly and severally agrees to pay to the Collateral Agent upon demand the amount of any and all reasonable out-of-pocket costs and expenses of the Collateral Agent, including the reasonable fees, costs, expenses and disbursements of counsel for the Collateral Agent and of any experts and agents (including, without limitation, any collateral trustee which may act as agent of the Collateral Agent), which the Collateral Agent may incur in connection with (i) the preparation, negotiation, execution, delivery, recordation, administration, amendment, waiver or other modification or termination of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, any Collateral, (iii) the exercise or enforcement of any of the rights of the Collateral Agent hereunder, or (iv) the failure by any Grantor to perform or observe any of the provisions hereof. ARTICLE 9 NOTICES, ETC (a) All notices and other communications provided for hereunder shall be in writing and shall be mailed (by certified mail, postage prepaid and return receipt requested), telecopied or delivered, if to a Grantor, to it in care of the Company at its address specified in the Indenture and if to the Collateral Agent, to it at U.S. Bank National Association, 425 Walnut Street, Cincinnati, Ohio 45202, Fax: (513)-632-5511, Attention: Corporate Trust Office; or as to any such Person, at such other address as shall be designated by such Person in a written notice to such other Person complying as to delivery with the terms of this ARTICLE 9(a). All such notices and other communications shall be effective (a) if mailed (by certified mail, postage prepaid and return receipt requested), when received or three (3) days after deposited in the mails, whichever occurs first, (b) if telecopied, when transmitted and confirmation received or (c) if delivered, upon delivery. ARTICLE 10 SECURITY INTEREST ABSOLUTE (a) All rights of the Collateral Agent, the Trustee and the Holders, all Liens and all obligations of each of the Grantors hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Indenture or any other Senior Secured Note Document, (b) any change in the time, manner or place of payment of, or in any other term in 15 respect of, all or any of the Senior Secured Note Obligations, or any other amendment or waiver of or consent to any departure from the Indenture or any other Senior Secured Note Document, (c) any exchange or release of, or non-perfection of any Lien on any Collateral, or any release or amendment or waiver of or consent to departure from any guaranty, for all or any of the Senior Secured Note Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any of the Grantors in respect of the Senior Secured Note Obligations. All authorizations and agencies contained herein with respect to any of the Collateral are irrevocable and powers coupled with an interest. (b) Each Grantor acknowledges and agrees that, in the event it amalgamates with any other company or companies, it is the intention of the parties hereto that the term "Grantor", when used herein, shall apply to each of the amalgamating companies and to the amalgamated company, such that the security interest granted hereby: (i) shall extend to "Collateral" (as that term is herein defined) owned by each of the amalgamating companies and the amalgamated company at the time of amalgamation and to any "Collateral" thereafter owned or acquired by the amalgamated company, and (ii) shall secure all "Senior Secured Note Obligations" (as that term is herein defined) of each of the amalgamating companies and the amalgamated company to the Collateral Agent, the Trustee and the Holders at the time of amalgamation and all "Senior Secured Note Obligations" of the amalgamated company to the Collateral Agent and the Lenders thereafter arising. The security interest created herein shall attach to all "Collateral" owned by each company amalgamating with such Grantor, and by the amalgamated company, at the time of the amalgamation, and shall attach to all "Collateral" thereafter owned or acquired by the amalgamated company when such becomes owned or is acquired. ARTICLE 11 MISCELLANEOUS (a) No amendment of any provision of this Agreement (including any Schedule attached hereto) shall be effective unless it is in writing and signed by each Grantor and the Collateral Agent, and no waiver of any provision of this Agreement, and no consent to any departure by any Grantor therefrom, shall be effective unless it is in writing and signed by the Collateral Agent, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. (b) No failure on the part of the Collateral Agent, the Trustee or the Holders to exercise, and no delay in exercising, any right hereunder or under any other Senior Secured Note Document shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. The rights and remedies of the Collateral Agent, the Trustee or the Holders provided herein and in the other Senior Secured Note Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law. The rights of the Collateral Agent, the Trustee or the Holders under any Senior Secured Note Document against any party thereto are not conditional or contingent on any attempt by such Person to exercise any of its rights under any other Senior Secured Note Document against such party or against any other Person, including but not limited to, any Grantor. 16 (c) Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction. (d) This Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the date on which the Discharge of Senior Secured Note Obligations has occurred and (ii) be binding on each Grantor and their respective successors (including any successor by reason of amalgamation) and assigns, and all other Persons who become bound as debtor to this Agreement in accordance with any other Senior Secured Note Document and shall enure, together with all rights and remedies of the Collateral Agent, the Trustee or the Holders hereunder, to the benefit of the Collateral Agent, the Trustee or the Holders and their respective permitted successors, transferees and assigns. Upon any such assignment or transfer, all references in this Agreement to any such Collateral Agent, Trustee or Holders shall mean the assignee of Collateral Agent, Trustee or the Holders. None of the rights or obligations of any Grantor hereunder may be assigned or otherwise transferred without the prior written consent of the Collateral Agent, and any such assignment or transfer shall be null and void. (e) Upon the date on which the Discharge of Senior Secured Note Obligations has occurred, this Agreement and the security interests created hereby shall terminate and all rights to the Collateral shall revert to the Grantors. Notwithstanding the foregoing, the Collateral Agent's Liens upon the Collateral shall automatically be released upon any of the events specified in Section 10.03 of the Indenture in accordance with the terms of the Indenture, and the Collateral of any Grantor that is released from its Note Guarantee obligations and is no longer a Guarantor pursuant to Section 11.05 of the Indenture shall automatically be released upon such an event in accordance with the terms of the Indenture, and such Grantor shall no longer be a party to this Agreement.. In connection with any termination or release pursuant to this ARTICLE 11(e), the Collateral Agent will, upon any Grantor's request and at such Grantor's expense, without any representation, warranty or recourse whatsoever, (i) return to such Grantor such Collateral to be released (in the case of a release) as shall not have been sold or otherwise disposed of or applied pursuant to the terms hereof and (ii) execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such termination or release. (f) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE PROVINCE OF ONTARIO AND THE FEDERAL LAWS OF CANADA APPLICABLE THEREIN, AS THE SAME MAY FROM TIME TO TIME BE IN EFFECT, INCLUDING, WHERE APPLICABLE, THE PPSA EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAW OF SOME OTHER JURISDICTION. 17 (g) ANY LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT RELATED THERETO MAY BE BROUGHT IN THE COURTS OF THE PROVINCE OF ONTARIO, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GRANTOR HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS OR LACK OF PERSONAL JURISDICTION, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION, SUIT OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. (h) Each Grantor irrevocably consents to the service of process of any of the aforesaid courts in any such action, suit or proceeding by the mailing of copies thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such Grantor at its address provided herein, such service to become effective ten (10) days after such mailing. (i) Nothing contained herein shall affect the right of the Collateral Agent to serve process in any other manner permitted by law or commence legal proceedings or otherwise proceed against any Grantor or any property of any Grantor in any other jurisdiction. (j) Each Grantor irrevocably and unconditionally waives any right it may have to claim or recover in any legal action, suit or proceeding referred to in this Section any special, exemplary, punitive or consequential damages. (k) Section headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. (l) This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together constitute one in the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile shall be equally effective as delivery of an original executed counterpart. (m) All of the obligations of the Grantors hereunder are joint and several. The Collateral Agent may, in its sole and absolute discretion, enforce the provisions hereof against any of the Grantors and shall not be required to proceed against all Grantors jointly or seek payment from the Grantors ratably. In addition, the Collateral Agent may, in its sole and absolute discretion, select the Collateral of any one or more of the Grantors for sale or application to the Senior Secured Note Obligations, without regard to the ownership of such Collateral, and shall not be required to make such selection ratably from the Collateral owned by all of the Grantors. The release or discharge of any Grantor by the Collateral Agent shall not release or discharge any other Grantor from the obligations of such Person hereunder. 18 Notwithstanding any other provision contained in this Agreement or any other Senior Secured Note Document, if a "secured creditor" (as that term is defined under the Bankruptcy and Insolvency Act (Canada)) is determined by a court of competent jurisdiction not to include a Person to whom obligations are owed on a joint or joint and several basis, then each Grantor's Senior Secured Note Obligations, to the extent such Senior Secured Note Obligations are secured, only shall be several obligations (each as to 100% of the Senior Secured Note Obligations) and not joint or joint and several obligations. (n) When the context so requires, the singular number shall be read as if the plural were expressed and the provisions hereof shall be read with all grammatical changes necessary dependent upon the person referred to being a male, female, firm or corporation. (o) The Collateral Agent acknowledges and agrees, on behalf of itself, the Trustee and the Holders, that, any provision of this Agreement to the contrary notwithstanding, (i) no Grantor shall be required to act or refrain from acting (A) in a manner that is inconsistent with the terms and provisions of the Intercreditor Agreement or (B) with respect to any Collateral in any manner that would result in a default under the terms and provisions of any Credit Facility Document and (ii) any action required to be taken by a Grantor (or omission to act) pursuant to the terms of any Credit Facility Document in respect of Collateral will not put such Grantor in violation of or result in a default under the terms of this Agreement or any other Senior Secured Note Document. (p) Each Grantor and the Collateral Agent hereby acknowledge that (i) value has been given, (ii) such Grantor has rights in the Collateral and, to the extent that such Grantor does not acquire rights or interests in any of the Collateral until after the execution and delivery of this Agreement, the security interest created hereby shall attach to such Collateral at the time such Grantor acquires rights or interests therein, and (iii) this Agreement constitutes a security agreement as that term is defined in the PPSA. (q) Notwithstanding any provision to the contrary contained herein, the terms of this Agreement, the Liens created hereby and the rights and remedies of the Collateral Agent, the Trustee and the Holders hereunder are subject to the terms of the Intercreditor Agreement. (r) This Agreement shall remain in full force and effect and continue to be effective should any petition be filed by or against any Grantor for liquidation or reorganization, should any Grantor become insolvent or make an assignment for the benefit of any creditor or creditors or should a receiver or trustee or similar Person be appointed for all or any significant part of any Grantor's assets, and shall continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the Senior Secured Note Obligations, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of the Senior Secured Note Obligations, whether as a "voidable preference", "fraudulent conveyance", or otherwise, all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Senior Secured Note Obligations shall be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned. (s) Each Grantor hereby acknowledges receipt of a copy of this Agreement. 19 (t) To the extent permitted by applicable law, each Grantor waives such Grantor's right to receive a copy of any financing statement or financing change statement registered by the Collateral Agent, or of any verification statement with respect to any financing statement or financing change statement registered by the Collateral Agent. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 20 IN WITNESS WHEREOF, each Grantor has caused this Agreement to be executed and delivered by its officer thereunto duly authorized, as of the date first above written. GRANTORS: MILACRON CANADA INC. (ONTARIO) By: /s/ Hugh C. O'Donnell --------------------- Name: Hugh C. O'Donnell Title: Secretary 2913607 CANADA LIMITED By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Assistant Treasurer 450500 ONTARIO LIMITED By: /s/ Hugh C. O'Donnell --------------------- Name: Hugh C. O'Donnell Title: Secretary 528650 ONTARIO LIMITED By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Assistant Treasurer D-M-E OF CANADA LIMITED By: /s/ John C. Francy ------------------ Name: John C. Francy Title: Treasurer PROGRESS PRECISION INC. By: /s/ R. P. Lienesch ------------------ Name: R. P. Lienesch Title: Treasurer COLLATERAL AGENT: U.S. BANK NATIONAL ASSOCIATION By: /s/ Karolina K. Dies _______________________________ Name: Karolina K. Dies Title: Trust Officer Schedule I Legal Names: Jurisdiction of Organization
JURISDICTION OF COMPANY ORGANIZATION - ---------------------------------------------------------------------------- Milacron Canada Inc. Ontario 2913607 Canada Limited Canada 450500 Canada Limited Ontario 528650 Ontario Limited Ontario D-M-E of Canada Limited Ontario Progress Precision Inc. Ontario
Schedule II (i) Locations with Chattel Paper, Inventory, Equipment and / or Fixtures
COMPANY ADDRESS COUNTRY - ----------------------------------------------------------------------------------------------- D-M-E of Canada Limited 6210 Northwest Drive Canada Mississauga, Ontario L4V 1J6 450500 Ontario Limited 3275 Deziel Drive Canada Windsor, Ontario N8W 5A5 Milacron Canada Inc. 1175 Appleby Line Canada Unit #B1 Burlington, Ontario L7L 5H9 Progress Precision Inc. 3555 & 3557 Hawkestone Road Canada Mississauga, Ontario L5C 2V1 528650 Ontario Limited 155 West Beaver Creek Road Canada Units 8 Richmond Hill, Ontario L4B 1E1 2913607 Canada Limited 1100 rue Berlier Canada Laval, Quebec H7L 3R9
Schedule II (ii) Current Executive Offices
COMPANY ADDRESS STATE/COUNTRY - --------------------------------------------------------------------------------------------------- D-M-E of Canada Limited 6210 Northwest Drive Canada Mississauga, Ontario L4V 1J6 450500 Ontario Limited 3275 Deziel Drive Canada Windsor, Ontario N8W 5A5 Milacron Canada Inc. 1175 Appleby Line Canada Unit #B1 Burlington, Ontario L7L 5H9 Progress Precision Inc. 3555 & 3557 Hawkestone Canada Road Mississauga, Ontario L5C 2V1 528650 Ontario Limited 155 West Beaver Creek Rd Canada Unit 8 Richmond Hill, Ontario L4B 1E1 2913607 Canada Limited 1100 rue Berlier Canada Laval, Quebec H7L 3R9
Schedule II (iii) Location of Books and Records
COMPANY ADDRESS COUNTY STATE/COUNTRY - --------------------------------------------------------------------------------------------------------------------- D-M-E of Canada Limited 6210 Northwest Drive Canada Mississauga, Ontario L4V 1J6 D-M-E of Canada Ltd. 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 450500 Ontario Limited 3275 Deziel Drive Canada Windsor, Ontario N8W 5A5 Milacron Canada Inc. 1175 Appleby Line Canada Unit #B1 Burlington, Ontario L7L 5H9 Progress Precision Inc. 3555 & 3557 Canada Hawkestone Road Mississauga, Ontario L5C 2V1 Progress Precision Inc. 4165 Half Acre Road Clermont Ohio Batavia 45103 528650 Ontario Limited 155 West Beaver Creek Road Canada Units 8 Richmond Hill, Ontario L4B 1E1 528650 Ontario Limited 29111 Stephenson Highway Oakland Michigan Madison Heights 48071
2913607 Canada Limited 29111 Stephenson Highway Oakland Michigan Madison Heights 48071 2913607 Canada Limited 1100 rue Berlier Canada Laval, Quebec H7L 3R9

Schedule III Bank Account Information
NAME AND ADDRESS OF INSTITUTION MAINTAINING LOAN PARTY ACCOUNT ACCOUNT NUMBER TYPE OF ACCOUNT - ----------------------------------------------------------------------------------------------------------------------------- Milacron Canada Inc. Bank of Nova Scotia 1253-18 (USD) Deposit/Disbursement-USD O/A Milacron Canada Commercial Banking Centre 1001 Champlain Avenue 941-10 (CAD) Deposit/Disbursement-CAD Suite #100 Burlington, Ontario L7L 5Z4 Progress Precision Inc. TD Canada Trust 1552-7314542 (USD) Deposit - USD O/A Progress Precision 2038 Kipling Avenue Rexdale, Ontario M9W 4K1 0566-5208160 (CAD) Deposit/Disbursement-CAD 450500 Ontario Limited Royal Bank of Canada 400 891 8 (USD) Deposit/Disbursement-USD O/A 450500 Ontario 245 Ouellette Avenue Limited Canada Windsor, Ontario N9A 7J2 147 909 6 (CAD) Deposit/Disbursement-CAD 528650 Ontario Limited Scotiabank 405920277819 (USD) Deposit/Disbursement-USD O/A Ontario Heater and 101 Main Street North Supply Company Markham, Ontario L3P 1X9 405920157910 (CAD) Deposit/Disbursement-CAD 2913607 Canada Limited Scotiabank 315910111015 (USD) Deposit/Disbursement-USD O/A Rite Tek 101 Main Street North Markham, Ontario L3P 1X9 405920310719 (CAD) Deposit/Disbursement-CAD D-M-E of Canada Limited Royal Bank of Canada 100-607-1 (CAD) Deposit/Disbursement-CAD O/A DME of Canada Ltd. Airport & American Branch 6504 Airport Road 100-608-1 (CAD) Imprest Acct - Mississauga, Ontario L4V 1E1 Disbursement - CAD
SCHEDULE IV FINANCING STATEMENTS PPSA financing statements have been filed in the jurisdictions below against the Grantors:
Name of Debtor Jurisdiction - ------------------------------------------------------------------- Milacron Canada Inc. Ontario 450500 Ontario Limited Ontario Progress Precision Inc. Ontario 2913607 Canada Limited Ontario and Quebec 528650 Ontario Limited Ontario D-M-E of Canada Limited Ontario
EX-4.8 51 y98028exv4w8.txt PLEDGE AGREEMENT EXHIBIT 4.8 PLEDGE AGREEMENT PLEDGE AND SECURITY AGREEMENT, dated June 10, 2004, made by each of the Pledgors referred to below, in favor of U.S. Bank National Association, in its capacity as Collateral Agent for the Trustee and the Holders (as such terms are defined below) pursuant to the Indenture referred to below (in such capacity, together with any permitted successors and assigns, the "Collateral Agent"). W I T N E S S E T H: WHEREAS, Milacron Inc., a Delaware corporation (the "Company"), each subsidiary of the Company listed as a "Guarantor" on the signature pages of the supplemental indenture dated the date hereof to the Indenture (each such subsidiary and each subsidiary of the Company that has executed and delivered a Guarantee pursuant to the Indenture, a "Guarantor" and collectively, the "Guarantors," and the Guarantors (other than Milacron Capital Holdings B.V. and any Canadian Restricted Subsidiary) together with the Company, each a "Pledgor" and collectively, the "Pledgors"), the Collateral Agent and U.S. Bank National Association, in its capacity as trustee (in such capacity, together with any permitted successors and assigns, the "Trustee") are parties to an indenture, dated as of May 26, 2004 (as amended, restated, supplemented or otherwise modified from time to time, being hereinafter referred to as the "Indenture"), with respect to the Company's 11-1/2% Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, the Company has issued the Notes to the Holders; WHEREAS, it is a condition to the release to the Company from the Escrow Account of the proceeds from the offering of the Notes that each Pledgor shall execute and deliver this Agreement; WHEREAS, the Pledgors are mutually dependent on each other in the conduct of their respective businesses as an integrated operation, with the credit needed from time to time by each Pledgor often being provided through financing obtained by the other Pledgors and the ability to obtain such financing being dependent on the successful operations of all of the Pledgors as a whole; and WHEREAS, each Pledgor has determined that the execution, delivery and performance of this Agreement directly benefit, and are in the best interest of, such Pledgor; NOW, THEREFORE, in consideration of the premises and the agreements herein, the Pledgors hereby jointly and severally agree with the Collateral Agent, for the benefit of the Trustee and Holders, as follows: SECTION 1. Definitions. Reference is hereby made to the Indenture for a statement of the terms thereof. All terms used in this Agreement which are defined in the Indenture, in Article 8 or Article 9 of the Uniform Commercial Code (the "Code") as in effect from time to time in the State of New York or in the Intercreditor Agreement and which are not otherwise defined herein shall have the same meanings herein as set forth therein; provided that terms used herein which are defined in the Code as in effect on the date hereof shall continue to have the same meaning notwithstanding any replacement or amendment of such statute except as the Collateral Agent may otherwise determine; provided, further, that to the extent the Code is used to define any term in this Agreement and such term is defined differently in differing Articles of the Code, the definition of such term contained in Article 9 shall govern. SECTION 2. Pledge and Grant of Security Interest. As collateral security for all of the Senior Secured Note Obligations, each Pledgor hereby pledges and assigns to the Collateral Agent, and grants to the Collateral Agent, for the benefit of the Trustee and the Holders, a continuing security interest in, and Lien on such Pledgor's right, title and interest in and to the following (collectively, the "Pledged Collateral"): (a) the indebtedness described in Schedule I hereto and all other indebtedness from time to time owing to such Pledgor (the "Pledged Debt"), the promissory notes and other instruments evidencing the Pledged Debt, and, all interest, cash, instruments, investment property and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the Pledged Debt; (b) the shares of Capital Stock described in Schedule II hereto (the "Pledged Shares"), whether or not evidenced or represented by any stock certificate, certificated security or other instrument, issued by the Persons described in such Schedule II (the "Existing Issuers"), the certificates representing the Pledged Shares, all options and other rights, contractual or otherwise, in respect thereof and, all dividends, distributions, cash, instruments, investment property and other property (including, but not limited to, any stock dividend and any distribution in connection with a stock split) from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the Pledged Shares; (c) the shares of Capital Stock at any time and from time to time acquired by such Pledgor of any and all Persons now or hereafter existing (such Persons, together with the Existing Issuers, being hereinafter referred to collectively as the "Pledged Issuers" and individually as a "Pledged Issuer"), the certificates representing such Capital Stock, all options and other rights, contractual or otherwise, in respect thereof and, all dividends, distributions, cash, instruments, investment property and other property (including, but not limited to, any stock dividend and any distribution in connection with a stock split) from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the foregoing; (d) all investment property, financial assets, securities, Capital Stock, other equity interests, stock options and commodity contracts of such Pledgor, all notes, debentures, bonds, promissory notes or other evidences of indebtedness of such Pledgor, and all other assets now or hereafter received or receivable with respect to the foregoing; 2 (e) all security entitlements of such Pledgor in any and all of the foregoing; and (f) all proceeds (including proceeds of proceeds) of any and all of the foregoing; in each case, whether now owned or hereafter acquired by such Pledgor and howsoever its interest therein may arise or appear (whether by ownership, security interest, Lien, claim or otherwise). Notwithstanding the foregoing, the Pledged Collateral shall not include any Excluded Assets. The Pledgors agree that the pledge of shares of Capital Stock of any Pledged Issuer who is organized or formed under the laws of a jurisdiction other than the District of Columbia or any State of the United States of America (a "Foreign Jurisdiction") in favor of the Collateral Agent hereunder may be supplemented by one or more separate pledge agreements, deeds of pledge, share charges, or other similar agreements or instruments, executed and delivered by the relevant Pledgors in favor of the Collateral Agent, which pledge agreements will provide for the pledge of such shares of Capital Stock in accordance with the laws of such Foreign Jurisdiction. With respect to such shares of Capital Stock, the Collateral Agent may, at any time and from time to time, in its sole discretion (exercised reasonably), take actions in such Foreign Jurisdictions that will result in the perfection of the Lien created in such shares of Capital Stock, without the consent of the Pledgor. SECTION 3. Security for Senior Secured Note Obligations. The security interest created hereby in the Pledged Collateral constitutes continuing collateral security for all of the Senior Secured Note Obligations. SECTION 4. Delivery of the Pledged Collateral. (a) (i) All promissory notes currently evidencing the Pledged Debt and all certificates currently representing the Pledged Shares shall be delivered to the Collateral Agent on or prior to the execution and delivery of this Agreement. All other promissory notes, certificates and instruments constituting Pledged Collateral from time to time required to be pledged to the Collateral Agent pursuant to the terms of this Agreement or the Indenture or any other Senior Secured Note Document (the "Additional Collateral") shall be delivered to the Collateral Agent as promptly as practicable upon receipt thereof by or on behalf of any of the Pledgors. All such promissory notes, certificates and instruments shall be held by or on behalf of the Collateral Agent pursuant hereto and shall be delivered in suitable form for transfer by delivery or shall be accompanied by duly executed instruments of transfer or assignment or undated stock powers executed in blank, all in form and substance reasonably satisfactory to the Collateral Agent. If any Pledged Collateral consists of uncertificated securities, unless the immediately following sentence is applicable thereto, such Pledgor shall cause the Collateral Agent (or its designated custodian or nominee) to become the registered holder thereof, or cause each issuer of such securities to agree that it will comply with instructions originated by the Collateral Agent with respect to such securities without further consent by such Pledgor. If any Pledged Collateral consists of security entitlements, such Pledgor shall transfer such security entitlements to the Collateral Agent (or its custodian, nominee or other designee), or cause the 3 applicable securities intermediary to agree that it will comply with entitlement orders by the Collateral Agent without further consent by such Pledgor. Notwithstanding the foregoing, until the date upon which the Discharge of the Credit Facility Obligations has occurred, the provisions of this Section 4(a)(i) shall not apply to any Pledged Collateral consisting of Credit Facility Priority Collateral. (ii) Within five (5) days of the receipt by a Pledgor of any Additional Collateral, a Pledge Amendment, duly executed by such Pledgor, in substantially the form of Annex I hereto (a "Pledge Amendment"), shall be delivered to the Collateral Agent, in respect of the Additional Collateral which must be pledged pursuant to this Agreement and the Indenture or any other Senior Secured Note Document. The Pledge Amendment shall from and after delivery thereof constitute part of Schedules I and II hereto. Each Pledgor hereby authorizes the Collateral Agent to attach each Pledge Amendment to this Agreement and agrees that all promissory notes, certificates or instruments listed on any Pledge Amendment delivered to the Collateral Agent shall for all purposes hereunder constitute Pledged Collateral and such Pledgor shall be deemed upon delivery thereof to have made the representations and warranties set forth in Section 5 hereof with respect to such Additional Collateral. (b) If any Pledgor shall receive, by virtue of such Pledgor's being or having been an owner of any Pledged Collateral (other than, until the date upon which the Discharge of Credit Facility Obligations has occurred, any Pledged Collateral consisting of Credit Facility Priority Collateral), any (i) stock certificate (including, without limitation, any certificate representing a stock dividend or distribution in connection with any increase or reduction of capital, reclassification, merger, consolidation, sale of assets, combination of shares, stock split, spin-off or split-off), promissory note or other instrument, (ii) option or right, whether as an addition to, substitution for, or in exchange for, any Pledged Collateral, or otherwise, (iii) dividends payable in cash (except such dividends permitted to be retained by any such Pledgor pursuant to Section 7 hereof) or in securities or other property or (iv) dividends, distributions, cash, instruments, investment property and other property in connection with a partial or total liquidation or dissolution or in connection with a reduction of capital, capital surplus or paid in surplus, such Pledgor shall receive such stock certificate, promissory note, instrument, option, right, payment or distribution in trust for the benefit of the Collateral Agent, shall segregate it from such Pledgor's other property and shall deliver it forthwith to the Collateral Agent, in the exact form received, with any necessary indorsement and/or appropriate stock powers duly executed in blank, to be held by the Collateral Agent as Pledged Collateral and as further collateral security for the Senior Secured Note Obligations. SECTION 5. Representations and Warranties. Each Pledgor jointly and severally represents and warrants as follows: 4 (a) Each Pledgor (i) is a corporation, limited liability company or limited partnership duly organized, validly existing and in good standing under the laws of the state, province or other applicable jurisdiction of its organization, (ii) has all requisite power and authority to conduct its business as now conducted and as presently contemplated and to execute, deliver and perform this Agreement and each other Senior Secured Note Document to be executed and delivered by it pursuant hereto and to consummate the transactions contemplated hereby and thereby, and (iii) is duly qualified to do business and is in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary, except where the absence of any such qualification could not reasonably be expected to result in a material adverse effect on the condition (financial or other), business, properties or results of operations of the Pledgors and their respective subsidiaries, taken as a whole. (b) The execution, delivery and performance by each Pledgor of this Agreement and the other Senior Secured Note Documents to which such Pledgor is or will be party (i) have been duly authorized by all necessary action, (ii) do not and will not contravene its (x) charter or by-laws, its limited liability company or operating agreement or its certificate of partnership or partnership agreement, as applicable, or (y) any material applicable law or any material contractual restriction binding on or affecting it or any of its properties, (iii) do not and will not result in or require the creation of any Lien (other than pursuant to any Senior Secured Note Document or any Credit Facility Document) upon or with respect to any of its properties, other than Liens securing obligations in an aggregate amount not exceeding $100,000 and (iv) do not and will not result in any default, noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of any material permit, license, authorization or approval applicable to it or its operations or any of its properties. (c) The Existing Issuers set forth in Schedule II hereto are the Pledgors' only wholly owned directly owned Subsidiaries (excluding Immaterial Subsidiaries and Milacron Capital Holdings B.V. and its Subsidiaries) existing on the date hereof. The Pledged Shares have been duly authorized and validly issued and are fully paid and nonassessable and the holders thereof are not entitled to any preemptive, first refusal or other similar rights. Except as noted in Schedule II hereto, the Pledged Shares constitute 100% of the issued shares of Capital Stock of the Pledged Issuers as of the date hereof. (d) The promissory notes currently evidencing the Pledged Debt have been duly authorized, executed and delivered by the respective makers thereof, and all such promissory notes are or will be, as the case may be, legal, valid and binding obligations of such makers, enforceable against such makers in accordance with their respective terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws or by equitable principles. (e) Except with respect to transfers made in compliance with the Indenture and other than a Permitted Prior Lien that is an inchoate Lien securing obligations for the payment of money not overdue or not otherwise due and payable, each Pledgor is and will be at all times the legal and beneficial owner of its Pledged Collateral free and clear of all Liens, except for the Lien created by this Agreement, the other Senior Secured Note Documents and the Credit Facility Documents. 5 (f) The exercise by the Collateral Agent of any of its rights and remedies expressly enumerated in this Agreement, subject to the rights of Persons holding Permitted Liens, will not contravene any law or any material contractual restriction binding on or affecting any Pledgor or any of the material properties of any Pledgor and will not result in or require the creation of any Lien upon or with respect to any of the properties of such Pledgor other than pursuant to this Agreement, the other Senior Secured Note Documents and the Credit Facility Documents. (g) No authorization or approval or other action by, and no notice to or filing with, any governmental authority is required to be obtained or made by any Pledgor for (i) the due execution, delivery and performance by any Pledgor of this Agreement, (ii) the grant by any Pledgor, or the perfection, of the Lien created hereby in the Pledged Collateral (other than Pledged Collateral constituting Capital Stock (whether or not certificated) of any Pledged Issuer who is organized or formed under the laws of a Foreign Jurisdiction) or (iii) the exercise by the Collateral Agent of any of its rights and remedies expressly enumerated in this Agreement (other than with respect to Pledged Collateral constituting Capital Stock (whether or not certificated) of any Pledged Issuer who is organized or formed under the laws of a Foreign Jurisdiction), except as may be required in connection with any sale of any Pledged Collateral by laws affecting the offering and sale of securities generally other than those that have been obtained or made and are in full force and effect. (h) This Agreement creates a valid Lien in favor of the Collateral Agent, for the benefit of the Trustee and the Holders, in the Pledged Collateral as security for the Senior Secured Note Obligations to the extent governed by the Code. The Collateral Agent's having possession (or, with respect to Pledged Collateral constituting Credit Facility Priority Collateral, the Credit Facility Agent having possession, as bailee for the Collateral Agent pursuant to the terms of the Intercreditor Agreement) of the promissory notes evidencing the Pledged Debt, the certificates representing the Pledged Shares and all other certificates, instruments and cash constituting Pledged Collateral from time to time results in the perfection of such Lien to the extent governed by the Code . Such Lien on the Pledged Collateral is a perfected, first priority Lien subject to Liens arising under the Credit Facility Documents and Permitted Prior Liens that are inchoate Liens securing obligations for the payment of money not overdue or not otherwise due and payable. All action necessary or desirable to perfect and protect such Lien on any Pledged Collateral shall have been duly taken, upon the Collateral Agent's having possession (or, with respect to Pledged Collateral constituting Credit Facility Priority Collateral, the Credit Facility Agent having possession, as bailee for the Collateral Agent pursuant to the terms of the Intercreditor Agreement) of certificates, instruments and cash constituting such Pledged Collateral. SECTION 6. Covenants as to the Pledged Collateral. Until the Discharge of the Senior Secured Note Obligations (as defined in the Security Agreement), each Pledgor will, unless the Collateral Agent shall otherwise consent in writing: 6 (a) keep adequate records concerning the Pledged Collateral and, upon the reasonable request of the Collateral Agent, permit the Collateral Agent or any agents, designees or representatives thereof at any time or from time to time, upon reasonable prior notice and during normal business hours, to examine and make copies of and abstracts from such records; (b) at the Pledgors' joint and several expense, promptly deliver to the Collateral Agent a copy of each material notice or other material communication received by it in respect of the Pledged Collateral; (c) at the Pledgors' joint and several expense, defend the Collateral Agent's right, title and security interest in and to the Pledged Collateral against the claims of any Person other than Liens created by the Senior Secured Note Documents and Permitted Liens; (d) at the Pledgors' joint and several expense, at any time and from time to time, promptly execute and deliver all further instruments and documents and take all further action that the Collateral Agent may determine to be reasonably necessary or desirable in order to (i) perfect and protect, or maintain the perfection of, the security interest and Lien created hereby, (ii) enable the Collateral Agent to exercise and enforce its rights and remedies hereunder in respect of the Pledged Collateral or (iii) otherwise effect the purposes of this Agreement, including, without limitation, delivering to the Collateral Agent irrevocable proxies in respect of the Pledged Collateral (other than, until the date upon which the Discharge of the Credit Facility Obligations has occurred, Pledged Collateral that constitutes Credit Facility Priority Collateral); (e) not sell, assign (by operation of law or otherwise), exchange or otherwise dispose of any Pledged Collateral or any interest therein except as expressly permitted by Section 4.10 of the Indenture; (f) not create or suffer to exist any Lien upon or with respect to any Pledged Collateral, except for the Lien created hereby and any Permitted Liens; (g) not make or consent to any amendment or other modification or waiver with respect to any Pledged Collateral or enter into any agreement or permit to exist any restriction with respect to any Pledged Collateral other than pursuant to the Senior Secured Note Documents and the Credit Facility Documents; (h) not permit the issuance of (i) any additional shares of any class of Capital Stock of any Pledged Issuer, (ii) any securities convertible voluntarily by the holder thereof or automatically upon the occurrence or non-occurrence of any event or condition into, or exchangeable for, any such shares of Capital Stock or (iii) any warrants, options, contracts or other commitments entitling any Person to purchase or otherwise acquire any such shares of Capital Stock, except in the case of clauses (i), (ii) and (iii), to the extent any such issuance is not prohibited by the Indenture; and (i) not take or fail to take any action which would in any manner impair the validity or enforceability of the Collateral Agent's security interest in and Lien on any Pledged Collateral. 7 SECTION 7. Voting Rights, Dividends, Etc. in Respect of the Pledged Collateral. (a) So long as no Event of Default shall have occurred and be continuing: (i) each Pledgor may exercise any and all voting and other consensual rights pertaining to any Pledged Collateral for any purpose not inconsistent with the terms of this Agreement, the Indenture or the other Senior Secured Note Documents; (ii) each of the Pledgors may receive and retain any and all dividends, interest or other distributions paid in respect of the Pledged Collateral to the extent not prohibited by the Indenture; provided, however, that any and all (A) dividends and interest paid or payable other than in cash in respect of, and instruments and other property received, receivable or otherwise distributed in respect of or in exchange for, any Pledged Collateral, (B) dividends and other distributions paid or payable in cash in respect of any Pledged Collateral in connection with a partial or total liquidation or dissolution or in connection with a reduction of capital, capital surplus or paid-in surplus, and (C) cash paid, payable or otherwise distributed in redemption of, or in exchange for, any Pledged Collateral, together with any dividend, interest or other distribution or payment which at the time of such payment was not permitted by the Indenture, shall be, and shall forthwith be delivered to the Collateral Agent, to hold as, Pledged Collateral and shall, if received by any of the Pledgors, be received in trust for the benefit of the Collateral Agent, shall be segregated from the other property or funds of the Pledgors, and shall be forthwith delivered to the Collateral Agent in the exact form received with any necessary indorsement and/or appropriate stock powers duly executed in blank, to be held by the Collateral Agent as Pledged Collateral and as further collateral security for the Senior Secured Note Obligations; provided, further, however, that until the date upon which the Discharge of the Credit Facility Obligations has occurred, the provisions of this Section 7(a)(ii) shall not apply to any Pledged Collateral consisting of the Credit Facility Priority Collateral; and (iii) the Collateral Agent will execute and deliver (or cause to be executed and delivered) to a Pledgor all such proxies and other instruments as such Pledgor may reasonably request for the purpose of enabling such Pledgor to exercise the voting and other rights which it is entitled to exercise pursuant to Section 7(a)(i) hereof and to receive the dividends, interest and/or other distributions which it is authorized to receive and retain pursuant to Section 7(a)(ii) hereof. (b) Upon the occurrence and during the continuance of an Event of Default: (i) all rights of each Pledgor to exercise the voting and other consensual rights which it would otherwise be entitled to exercise pursuant to Section 7(a)(i) hereof, and to receive the dividends, distributions, interest and other payments that it would otherwise be authorized to receive and retain pursuant to Section 7(a)(ii) hereof, shall cease, and all such rights shall thereupon become vested in the Collateral Agent, which shall thereupon have the sole right to exercise such voting and other consensual rights and to receive and hold as Pledged Collateral such dividends and interest payments; 8 (ii) the Collateral Agent is authorized to notify each debtor with respect to the Pledged Debt to make payment directly to the Collateral Agent (or its designee) and may collect any and all moneys due or to become due to any Pledgor in respect of the Pledged Debt, and each of the Pledgors hereby authorizes each such debtor to make such payment directly to the Collateral Agent (or its designee) without any duty of inquiry; (iii) without limiting the generality of the foregoing, the Collateral Agent may at its option exercise any and all rights of conversion, exchange, subscription or any other rights, privileges or options pertaining to any of the Pledged Collateral as if it were the absolute owner thereof, including, without limitation, the right to exchange, in its discretion, any and all of the Pledged Collateral upon the merger, consolidation, reorganization, recapitalization or other adjustment of any Pledged Issuer, or upon the exercise by any Pledged Issuer of any right, privilege or option pertaining to any Pledged Collateral, and, in connection therewith, to deposit and deliver any and all of the Pledged Collateral with any committee, depository, transfer agent, registrar or other designated agent upon such terms and conditions as it may determine; and (iv) all dividends, distributions, interest and other payments that are received by any of the Pledgors contrary to the provisions of Section 7(b)(i) hereof shall be received in trust for the benefit of the Collateral Agent, shall be segregated from other funds of the Pledgors, and shall be forthwith paid over to the Collateral Agent as Pledged Collateral in the exact form received with any necessary indorsement and/or appropriate stock powers duly executed in blank, to be held by the Collateral Agent as Pledged Collateral and as further collateral security for the Senior Secured Note Obligations provided, however, that the foregoing provisions shall not apply to any Pledged Collateral that constitutes Credit Facility Priority Collateral until the Discharge of the Credit Facility Obligations. SECTION 8. Additional Provisions Concerning the Pledged Collateral. (a) To the maximum extent permitted by applicable law, and for the purpose of taking any action that the Collateral Agent may deem reasonably necessary or advisable to accomplish the purposes of this Agreement, each Pledgor (i) authorizes the Collateral Agent to execute any such agreements, instruments or other documents in such Pledgor's name and to file such agreements, instruments or other documents in such Pledgor's name and to file such agreements, instruments, or other documents in any appropriate filing office, (ii) authorizes the Collateral Agent to file any financing statements required hereunder or under any other Senior Secured Note Document, and any continuation statements or amendment with respect thereto, in any appropriate filing office without the signature of such Pledgor and (iii) ratifies the filing of any financing statement, and any continuation statement or amendment with respect thereto, filed without the signature of such Pledgor prior to the date hereof. A photocopy or other reproduction of this Agreement or any financing statement covering the Pledged Collateral or any part thereof shall be sufficient as a financing statement where permitted by law. 9 (b) Each Pledgor hereby irrevocably appoints the Collateral Agent as such Pledgor's attorney-in-fact and proxy, with full authority in the place and stead of such Pledgor and in the name of such Pledgor or otherwise, and upon the occurrence and during the continuance of an Event of Default the Collateral Agent may take any action and execute any instrument that the Collateral Agent may deem reasonably necessary or advisable to accomplish the purposes of this Agreement (subject to the Intercreditor Agreement and the rights of such Pledgor under Section 7(a) hereof), including, without limitation, to receive, indorse and collect all instruments made payable to such Pledgor representing any dividend, interest payment or other distribution in respect of any Pledged Collateral and to give full discharge for the same. This power is coupled with an interest and is irrevocable until the Discharge of the Senior Secured Note Obligations. (c) If any Pledgor fails to perform any agreement or obligation contained herein, the Collateral Agent itself may perform, or cause performance of, such agreement or obligation, and the expenses of the Collateral Agent incurred in connection therewith shall be jointly and severally payable by the Pledgors pursuant to Section 10 hereof and shall be secured by the Pledged Collateral. (d) Other than the exercise of reasonable care to assure the safe custody of the Pledged Collateral while held hereunder, the Collateral Agent shall have no duty or liability to preserve rights pertaining thereto and shall be relieved of all responsibility for the Pledged Collateral upon surrendering it or tendering surrender of it to any of the Pledgors. The Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Pledged Collateral in its possession if the Pledged Collateral is accorded treatment substantially equal to that which the Collateral Agent accords its own property, it being understood that the Collateral Agent shall not have responsibility for (i) ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relating to any Pledged Collateral, whether or not the Collateral Agent has or is deemed to have knowledge of such matters, or (ii) taking any necessary steps to preserve rights against any parties with respect to any Pledged Collateral. (e) The powers conferred on the Collateral Agent hereunder are solely to protect its interest in the Pledged Collateral and shall not impose any duty upon the Collateral Agent to exercise any such powers. Except for the safe custody of any Pledged Collateral in its possession and the accounting for monies actually received by it hereunder, the Collateral Agent shall have no duty as to any Pledged Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Pledged Collateral. (f) The Collateral Agent may at any time in its discretion during the continuance of an Event of Default (i) without notice to any Pledgor, transfer or register in the name of the Collateral Agent or any of its nominees any or all of the Pledged Collateral, subject only to the revocable rights of such Pledgor under Section 7(a) hereof, and (ii) exchange certificates or instruments constituting Pledged Collateral for certificates or instruments of smaller or larger denominations; provided that, until the date on which the Discharge of the Credit Facility Obligations has occurred, this Section 8(f) shall not apply with respect to Credit Facility Priority Collateral. 10 SECTION 9. Remedies Upon Default. In each case subject to the Intercreditor Agreement, if any Event of Default shall have occurred and be continuing: (a) The Collateral Agent may exercise in respect of the Pledged Collateral, in addition to any other rights and remedies provided for herein or otherwise available to it, all of the rights and remedies of a secured party upon default under the Code then in effect in the State of New York; and without limiting the generality of the foregoing and without notice except as specified below, sell the Pledged Collateral or any part thereof in one or more parcels at public or private sale, at any exchange or broker's board or elsewhere, at such price or prices and on such other terms as the Collateral Agent may deem commercially reasonable. Each Pledgor agrees that, to the extent notice of sale shall be required by law, at least ten (10) days' notice to such Pledgor of the time and place of any public sale of Pledged Collateral owned by such Pledgor or the time after which any private sale is to be made shall constitute reasonable notification. The Collateral Agent shall not be obligated to make any sale of Pledged Collateral regardless of whether or not notice of sale has been given. The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. (b) In the event that the Collateral Agent determines to exercise its right to sell all or any part of the Pledged Collateral pursuant to Section 9(a) hereof, each Pledgor will, at such Pledgor's expense and upon request by the Collateral Agent: (i) execute and deliver, and cause each issuer of such Pledged Collateral and the directors and officers thereof to execute and deliver, all such instruments and documents, and do or cause to be done all such other acts and things, as may be necessary or, in the reasonable opinion of the Collateral Agent, advisable to register such Pledged Collateral under the provisions of the Securities Act, and to cause the registration statement relating thereto to become effective and to remain effective for such period as prospectuses are required by law to be furnished, and to make all amendments and supplements thereto and to the related prospectus which, in the opinion of the Collateral Agent, are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules and regulations of the SEC applicable thereto, (ii) use commercially reasonable efforts to cause each issuer of such Pledged Collateral to qualify such Pledged Collateral under the state securities or "Blue Sky" laws of each jurisdiction, and to obtain all necessary governmental approvals for the sale of the Pledged Collateral, as requested by the Collateral Agent, (iii) cause each Pledged Issuer to make available to its securityholders, as soon as practicable, an earnings statement which will satisfy the provisions of Section 11(a) of the Securities Act, and (iv) do or cause to be done all such other reasonable acts and things as may be necessary to make such sale of such Pledged Collateral valid and binding and in compliance with applicable law. Each Pledgor acknowledges the impossibility of ascertaining the amount of damages which would be suffered by the Collateral Agent by reason of the failure by any Pledgor to perform any of the covenants contained in this Section 9(b) and, consequently, agrees that, if any Pledgor fails to perform any of such covenants, it shall pay, as liquidated damages and not as a penalty, an amount equal to the value of the Pledged Collateral on the date the Collateral Agent demands compliance with this Section 9(b); provided, however, that the payment of such amount shall not release any Pledgor from any of its obligations under any of the other Senior Secured Note Documents. 11 (c) Notwithstanding the provisions of Section 9(b) hereof, each Pledgor recognizes that the Collateral Agent may deem it impracticable to effect a public sale of all or any part of the Pledged Shares or any other securities constituting Pledged Collateral and that the Collateral Agent may, therefore, determine to make one or more private sales of any such securities to a restricted group of purchasers who will be obligated to agree, among other things, to acquire such securities for their own account, for investment and not with a view to the distribution or resale thereof. Each Pledgor acknowledges that any such private sale may be at prices and on terms less favorable to the seller than the prices and other terms which might have been obtained at a public sale and, notwithstanding the foregoing, agrees that such private sales shall be deemed to have been made in a commercially reasonable manner and that the Collateral Agent shall have no obligation to delay the sale of any such securities for the period of time necessary to permit the issuer of such securities to register such securities for public sale under the Securities Act. Each Pledgor further acknowledges and agrees that any offer to sell such securities which has been (i) publicly advertised on a bona fide basis in a newspaper or other publication of general circulation in the financial community of New York, New York (to the extent that such an offer may be so advertised without prior registration under the Securities Act) or (ii) made privately in the manner described above to not less than fifteen bona fide offerees shall be deemed to involve a "public disposition" for the purposes of Section 9-610(c) of the Code (or any successor or similar, applicable statutory provision) as then in effect in the State of New York, notwithstanding that such sale may not constitute a "public offering" under the Securities Act, and that the Collateral Agent may, in such event, bid for the purchase of such securities. (d) Any cash held by the Collateral Agent as Pledged Collateral and all cash proceeds received by the Collateral Agent in respect of any sale of, collection from, or other realization upon, all or any part of the Pledged Collateral may, in the discretion of the Collateral Agent, be held by the Collateral Agent as collateral for, and/or then or at any time thereafter applied (after payment of any amounts payable to the Collateral Agent pursuant to Section 10 hereof) in whole or in part by the Collateral Agent against, all or any part of the Senior Secured Note Obligations in such order as the Collateral Agent shall elect consistent with the provisions of the Indenture and the Intercreditor Agreement. Any surplus of such cash or cash proceeds held by the Collateral Agent and remaining after the Discharge of the Senior Secured Note Obligations shall be paid over to the Pledgors or to such Person as may be lawfully entitled to receive such surplus. (e) In the event that the proceeds of any such sale, collection or realization are insufficient to pay all amounts to which the Collateral Agent, the Trustee and the Holders are legally entitled, the Pledgors shall be jointly and severally liable for the deficiency, together with interest thereon at the highest rate specified in any applicable Senior Secured Note Document for interest on overdue principal thereof or such other rate as shall be fixed by applicable law, together with the costs of collection and the reasonable fees, costs and expenses and other client charges of any attorneys employed by the Collateral Agent to collect such deficiency. 12 SECTION 10. Indemnity and Expenses. (a) Each Pledgor jointly and severally agrees to defend, protect, indemnify and hold harmless the Collateral Agent and the Trustee (and all of their respective officers, directors, employees, attorneys, consultants and agents) from and against any and all damages, losses, liabilities, obligations, penalties, fees and reasonable out-of-pocket costs and expenses (including, without limitation, reasonable legal fees, costs, expenses and disbursements of the Collateral Agent's and the Trustee's counsel) to the extent that they arise out of or otherwise result from this Agreement (including, without limitation, enforcement of this Agreement), except, claims, losses or liabilities resulting solely and directly from such Person's gross negligence or willful misconduct as determined by a final judgment of a court of competent jurisdiction. (b) Each Pledgor jointly and severally agrees to pay to the Collateral Agent upon demand the amount of any and all reasonable out-of-pocket costs and expenses of the Collateral Agent, including the reasonable fees, costs, expenses and disbursements of the Collateral Agent's counsel and of any experts and agents (including, without limitation, any collateral trustee which may act as agent of the Collateral Agent) which the Collateral Agent may incur in connection with (i) the preparation, negotiation, execution, delivery, recordation, administration, amendment, waiver or other modification or termination of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, any Pledged Collateral, (iii) the exercise or enforcement of any of the rights of the Collateral Agent hereunder, or (iv) the failure by any Pledgor to perform or observe any of the provisions hereof. SECTION 11. Notices, Etc. All notices and other communications provided for hereunder shall be in writing and shall be mailed (by certified mail, postage prepaid and return receipt requested), telecopied or delivered, if to any Pledgor, to it in care of the Company at its address specified in the Indenture; if to the Collateral Agent, to it at U.S. Bank National Association, 425 Walnut Street, Cincinnati, Ohio 45202, Fax: (513) 632-5511, Attention: Corporate Trust Office; or as to any such Person, at such other address as shall be designated by such Person in a written notice to such other Person complying as to delivery with the terms of this Section 11. All such notices and other communications shall be effective (a) if mailed (by certified mail, postage prepaid and return receipt requested), when received or three (3) days after deposited in the mails, whichever occurs first, (b) if telecopied, when transmitted and confirmation is received or (c) if delivered, upon delivery. 13 SECTION 12. Security Interest Absolute. All rights of the Collateral Agent, the Trustee and the Holders, all Liens and all obligations of each of the Pledgors hereunder shall be absolute and unconditional irrespective of: (a) any lack of validity or enforceability of the Indenture or any other Senior Secured Note Document, (b) any change in the time, manner or place of payment of, or in any other term in respect of, all or any of the Senior Secured Note Obligations, or any other amendment or waiver of or consent to any departure from the Indenture or any other Senior Secured Note Document, (c) any exchange or release of, or non-perfection of any Lien on any Collateral, or any release or amendment or waiver of, or consent to or departure from any guaranty, for all or any of the Senior Secured Note Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any of the Pledgors in respect of the Senior Secured Note Obligations. All authorizations and agencies contained herein with respect to any of the Pledged Collateral are irrevocable and powers coupled with an interest. SECTION 13. Miscellaneous. (a) No amendment of any provision of this Agreement shall be effective unless it is in writing and signed by each Pledgor and the Collateral Agent, and no waiver of any provision of this Agreement, and no consent to any departure by any of the Pledgors therefrom, shall be effective unless it is in writing and signed by the Collateral Agent, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. (b) No failure on the part of the Collateral Agent, the Trustee or the Holders to exercise, and no delay in exercising, any right hereunder or under any other Senior Secured Note Document shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. The rights and remedies of the Collateral Agent, the Trustee and the Holders provided herein and in the other Senior Secured Note Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law. The rights of the Collateral Agent, the Trustee and the Holders under any Senior Secured Note Document against any party thereto are not conditional or contingent on any attempt by the Collateral Agent, the Trustee and the Holders to exercise any of their rights under any other document against such party or against any other Person. (c) Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction. 14 (d) This Agreement shall create a continuing security interest in and Lien on the Pledged Collateral and shall (i) remain in full force and effect until the Discharge of the Senior Secured Note Obligations and (ii) be binding on each Pledgor and its respective successors and assigns, and shall inure, together with all rights and remedies of the Collateral Agent, the Trustee and the Holders hereunder, to the benefit of the Collateral Agent, the Trustee and the Holders and their respective permitted successors, transferees and assigns. Without limiting the generality of clause (ii) of the immediately preceding sentence, the Collateral Agent, the Trustee and the Holders may assign or otherwise transfer their respective rights and obligations under this Agreement and any other Senior Secured Note Document to any other Person pursuant to the terms of the Indenture, and such other Person shall thereupon become vested with all of the benefits in respect thereof granted to the Collateral Agent, the Trustee and the Holders herein or otherwise. Upon any such assignment or transfer, all references in this Agreement to any Collateral Agent, the Trustee and the Holders shall mean the assignee of the Collateral Agent, the Trustee and the Holders. None of the rights or Senior Secured Note Obligations of any of the Pledgors hereunder may be assigned or otherwise transferred without the prior written consent of the Collateral Agent, and any such assignment or transfer shall be null and void. (e) Upon the Discharge of the Senior Secured Note Obligations, this Agreement and the security interest and Lien created hereby shall terminate and all rights to the Pledged Collateral shall revert to the Pledgors (or, until the date the Discharge of Credit Facility Obligations has occurred, to the Credit Facility Agent in accordance with the Intercreditor Agreement). Notwithstanding the foregoing, the Collateral Agent's Liens upon the Pledged Collateral shall automatically be released upon any of the events specified in Section 10.03 of the Indenture in accordance with the terms of the Indenture, and the Pledged Collateral of any Pledgor that is released from its Note Guarantee obligations and is no longer a Guarantor pursuant to Section 11.05 of the Indenture shall automatically be released upon such an event in accordance with the terms of the Indenture, and such Pledgor shall no longer be a party to this Agreement. In connection with any termination or release pursuant to this Section 13(e), the Collateral Agent will, upon a Pledgor's request and at such Pledgor's expense, without any representation, warranty or recourse whatsoever, (i) return to such Pledgor (or until the date that the Discharge of Credit Facility Obligations has occurred, to the Credit Facility Agent in accordance with the Intercreditor Agreement) such Pledged Collateral to be released (in the case of a release) as shall not have been sold or otherwise disposed of or applied pursuant to the terms hereof and (ii) execute and deliver to such Pledgor such documents as such Pledgor shall reasonably request to evidence such termination or release. (f) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST AND LIEN CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR PLEDGED COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. 15 (g) Section headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. (h) This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which shall be deemed an original, but all such counterparts shall constitute one and the same agreement. Delivery of an executed counterpart of this Agreement by facsimile shall be equally effective as delivery of an original executed counterpart. (i) All of the obligations of the Pledgors hereunder are joint and several. The Collateral Agent may, in its sole and absolute discretion, enforce the provisions hereof against any of the Pledgors and shall not be required to proceed against all Pledgors jointly or seek payment from the Pledgors ratably. In addition, the Collateral Agent may, in its sole and absolute discretion, select the Pledged Collateral of any one or more of the Pledgors for sale or application to the Senior Secured Note Obligations, without regard to the ownership of such Pledged Collateral, and shall not be required to make such selection ratably from the Pledged Collateral owned by all of the Pledgors. The release or discharge of any Pledgor by the Collateral Agent shall not release or discharge any other Pledgor from the Senior Secured Note Obligations of such Person hereunder. (j) The Collateral Agent acknowledges and agrees, on behalf of itself, the Trustee and the Holders, that, any provision of this Agreement to the contrary notwithstanding, (i) no Pledgor shall be required to act or refrain from acting (A) in a manner that is inconsistent with the terms and provisions of the Intercreditor Agreement or (B) with respect to any Credit Facility Priority Collateral in any manner that would result in a default under the terms and provisions of any Credit Facility Document and (ii) any action required to be taken by a Pledgor (or omission to act) pursuant to the terms of any Credit Facility Document in respect of Credit Facility Priority Collateral will not put such Pledgor in violation of or result in a default under the terms of this Agreement or any other Senior Secured Note Document. (k) Notwithstanding any provision to the contrary contained herein, the terms of this Agreement, the Liens created hereby and the rights and remedies of the Collateral Agent, the Trustee and the Holders hereunder are subject to the terms of the Intercreditor Agreement. In the event of any conflict between the terms of this Agreement and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern. 16 IN WITNESS WHEREOF, each Pledgor has caused this Agreement to be executed and delivered by its officer thereunto duly authorized, as of the date first above written. PLEDGORS: MILACRON INC. By: /s/ R. P. Lienesch ----------------------------------- Name: R. P. Lienesch Title: Vice President - Finance and Chief Financial Officer EACH PLEDGOR LISTED ON SCHEDULE A HERETO By: /s/ R. P. Lienesch ----------------------------------- Name: R. P. Lienesch Title: Treasurer EACH PLEDGOR LISTED ON SCHEDULE B HERETO By: /s/ R. P. Lienesch ----------------------------------- Name: R. P. Lienesch Title: Vice President MILACRON INTERNATIONAL MARKETING COMPANY By: /s/ R. P. Lienesch ----------------------------------- Name: R. P. Lienesch Title: Treasurer and Assistant Secretary COLLATERAL AGENT: U.S. BANK NATIONAL ASSOCIATION By: /s/ Karolina K. Dies ----------------------------------- Name: Karolina K. Dies Title: Trust Officer SCHEDULE A Milacron Marketing Company Northern Supply Company, Inc. Nickerson Machinery Chicago Inc. Pliers International, Inc. D-M-E U.S.A. Inc. D-M-E Manufacturing Inc. Uniloy Milacron Inc. Uniloy Milacron U.S.A. Inc. Milacron Industrial Products, Inc. Oak International, Inc. Cimcool Industrial Products Inc. Milacron Plastics Technologies Group Inc. SCHEDULE B Milacron Resin Abrasives Inc. D-M-E Company SCHEDULE I TO PLEDGE AGREEMENT PLEDGED DEBT INTERCOMPANY LOANS AS OF MARCH 31, 2004
Company Debtor or Issuer Amount Interest Rate ------- ---------------- ------ ------------- Milacron Inc. Producto Chemicals, Inc. (Milacron Industrial Products, Inc.) $ 860,315 2.860% Milacron Inc. D-M-E U.S.A. Inc. $186,351,586 1.610% D-M-E Company Milacron Inc. $ 55,788,306 2.860% Milacron Inc. Uniloy Milacron U.S.A. Inc. $143,386,903 1.610% Milacron Inc. Uniloy Milacron U.S.A. Inc. $ 67,422,520 2.860% Autojectors Inc. (Milacron Marketing Company) Milacron Inc. $ 1,304,168 2.860% Pliers International Inc. Milacron Inc. $ 3,191,964 2.860% Northern Supply Company, Inc. Milacron Inc. $ 2,293,613 2.860% Oak International, Inc. Milacron Inc. $ 4,429,809 2.860% Milacron International Marketing Company Milacron Inc. $ 1,147,739 0.000% Milacron Inc. D-M-E of Canada Limited $ 2,161,370 1.610% Milacron Inc. Milacron International Marketing Company Singapore $ 3,060,240 0.000% Milacron Inc. Milacron International Marketing Company Singapore $ 3,300,119 0.000% Milacron International Marketing Company Singapore Milacron Inc. $ 1,832,833 0.000% Nickerson Machinery Chicago, Inc Milicron Inc. $ 2,760,849 2.860%
1 FINANCED NOTES (*indicates notes where originals are missing)
OUTSTANDING FINANCED PRINCIPAL ACCRUED CURRENT COMPANY ISSUER AMOUNT BALANCE INTEREST BALANCE ------------------------------------------------------------------------------------ Milacron Inc. Koogler & Marlowe 440,000.00 440,000.00 - 440,000.00 Milacron Marketing Company Centro Magnetico -3/04 152,000.00 96,380.31 - 96,380.31 *Milacron Marketing Company Ayareb SA de CV - 3/04 2,506,560.00 882,216.49 - 882,216.49 *Milacron Marketing Company Ayareb SA de CV - 4/06 1,130,500.00 825,019.08 - 825,019.08 Milacron Marketing Company Distribuidora Mexicana- 4/06 221,143.50 159,400.29 2,621.24 162,021.53 Milacron Marketing Company DLM Plasticos - 3/06 148,500.00 148,500.00 148,500.00 Milacron Marketing Company Industrias Gesta - 2/04 121,053.75 28,445.51 218.08 28,663.59 *Milacron Marketing Company Industrias Gesta -2/05 78,227.10 20,079.64 102.62 20,182.26 Milacron Marketing Company Industrias Gesta - 4/05 123,300.00 72,590.66 417.39 73,008.05 Milacron Marketing Company Inyecfor SA de CV - 2/04 41,796.00 3,793.07 15.01 3,808.08 Milacron Marketing Company Tuberias Advance -4/05 179,010.00 109,866.34 1,893.66 111,760.00 *Milacron Marketing Company Tuberias Advance - 3/04 276,518.60 43,518.33 48.35 43,566.68 Milacron Marketing Company Tuberias Advance - 153,000.00 141,632.40 2,000.35 143,632.75 Uniloy Milacron Inc. Plasticos Boston - 3/07 421,820.76 296,320.38 296,320.38 ----------------------------------------------------- =====================================================
2 SCHEDULE II TO PLEDGE AND SECURITY AGREEMENT PLEDGED SHARES(1)
Percentage of Number of Outstanding Certificate Pledgor Name of Pledged Issuer Shares Shares Class Number ------- ---------------------- ------ ------ ----- ------ Milacron Inc. Uniloy Milacron U.S.A. Inc. 13,500 100% common 12 Milacron Inc. Milacron Plastics Technologies Group Inc. 1,000 100% common 1 Milacron Inc. Milacron Resin Abrasives Inc. 500 100% common 2 Milacron Inc. D-M-E Company 1,000 100% common 1 (formerly known as Cincinnati Milacron Inc.) Milacron Inc. Uniloy Milacron Inc. 10,000 100% common 1 (formerly known as Cincinnati Milacron Inc.) Milacron Inc. Cimcool Industrial Products Inc. 1,000 100% common 1 Milacron Inc. Milacron Industrial Products, Inc. 1,000 100% common 1 Milacron Inc. Milacron Marketing Company 2,000 100% common 3
- ------------------------ (1) Milacron Equipamentos Plastics Ltd and Cincinnati Milacron Trading (Shanghai) Co. are limited liability companies and, therefore, constitute "General Intangibles" (as defined in the Security Agreement) pursuant to Section 4(o) of the Security Agreement. 3
Percentage of Number of Outstanding Certificate Pledgor Name of Pledged Issuer Shares Shares Class Number ------- ---------------------- ------ ------ ----- ------ Milacron Inc. Milacron Assurance Ltd. 78,000 65% common 26 Milacron Inc. Milacron-Holdings Mexicana, S.A. de C.V. 650 65% ordinary 3 D-M-E Company D-M-E Manufacturing Inc. 1,000 100% common 1 D-M-E Company D-M-E U.S.A. Inc. 231,778 100% common 24 Uniloy Milacron Inc. Uniloy Milacron Machinery-Mexico, S.A. de C.V. 32,500 65% common 7 Uniloy Milacron Inc. Uniloy Milacron Services-Mexico, S.A. de C.V. 32,500 65% common 5 Cimcool Industrial Milacron Canada Inc. 2,367 65% common 18 Products Inc. Cimcool Industrial Cincinnati Milacron IPK, Inc. 153,530 65% uncertificated Products Inc.(2) Milacron Industrial Oak International, Inc. 30,000 100% common 12 Products, Inc. Milacron Marketing Company Northern Supply Company, Inc. 1,000 100% common 11 Milacron Marketing Company Nickerson Machinery Chicago Inc. 100 100% common 5 Milacron Marketing Company Pliers International Inc. 1,500 100% common 8
- ------------------------ (2) This is an uncertificated security and in accordance with Section 4(a)(i) of the Pledge Agreement, the Pledgor has caused the Collateral Agent to become the registered holder thereof. 4
Percentage of Number of Outstanding Certificate Pledgor Name of Pledged Issuer Shares Shares Class Number ------- ---------------------- ------ ------ ----- ------ Milacron Marketing Company Milacron International Marketing Company 5,000 100% common 3 Milacron Marketing Company Milacron Commercial Corp. 1,000 100% common 2 Milacron Inc. Milacron Capital Holdings B.V. 13 65% uncertificated D-M-E U.S.A. Inc. D-M-E- of Canada Limited 650 65% common C 84-5
5 ANNEX I TO PLEDGE AGREEMENT PLEDGE AMENDMENT This Pledge Amendment, dated _________ __, ___, is delivered pursuant to Section 4 of the Pledge Agreement referred to below. The undersigned hereby agrees that this Pledge Amendment may be attached to the Pledge and Security Agreement, dated [________], 2004, as it may heretofore have been or hereafter may be amended, restated or otherwise modified or supplemented from time to time (the "Pledge Agreement") and that the promissory notes or shares listed on this Pledge Amendment shall be hereby pledged and assigned to the Collateral Agent and become part of the Pledged Collateral referred to in such Pledge Agreement and shall secure all of the Senior Secured Note Obligations referred to in such Pledge Agreement. Pledged Debt
Principal Amount Pledgor Name of Maker Description Outstanding as of - ------------------------------------------------------------------------ - ------------------------------------------------------------------------ - ------------------------------------------------------------------------ - ------------------------------------------------------------------------
Pledged Shares
Percentage of Name of Number of Outstanding Certificate Pledgor Pledged Issuer Shares Shares Class Number - -------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------
[PLEDGOR] By:_____________________________ Name: Title: EX-4.9 52 y98028exv4w9.txt INTERCREDITOR AGREEMENT Exhibit 4.9 ================================================================================ INTERCREDITOR AGREEMENT BY AND BETWEEN JPMORGAN CHASE BANK AS ABL AGENT AND U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AS TERM AGENT DATED AS OF JUNE 10, 2004 ================================================================================ TABLE OF CONTENTS
Page No. -------- ARTICLE 1 DEFINITIONS............................................................................................ 2 Section 1.1 UCC Definitions................................................................................ 2 Section 1.2 Other Definitions.............................................................................. 2 Section 1.3 Rules of Construction.......................................................................... 11 ARTICLE 2 LIEN PRIORITY.......................................................................................... 12 Section 2.1 Agreement to Subordinate....................................................................... 12 Section 2.2 Waiver of Right to Contest Liens............................................................... 13 Section 2.3 Remedies Standstill............................................................................ 14 Section 2.4 Exercise of Rights............................................................................. 15 Section 2.5 No New Liens................................................................................... 17 ARTICLE 3 ACTIONS OF THE PARTIES................................................................................. 17 Section 3.1 Certain Actions Permitted...................................................................... 17 Section 3.2 Agent for Perfection........................................................................... 18 Section 3.3 Sharing of Information and Access.............................................................. 18 Section 3.4 Insurance...................................................................................... 19 Section 3.5 No Additional Rights For the Credit Parties Hereunder.......................................... 19 Section 3.6 Actions Upon Breach............................................................................ 19 Section 3.7 Inspection Rights and Insurance................................................................ 19 ARTICLE 4 APPLICATION OF PROCEEDS................................................................................ 20 Section 4.1 Application of Proceeds........................................................................ 20 Section 4.2 Specific Performance........................................................................... 21 ARTICLE 5 INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS............................................................. 22 Section 5.1 Notice of Acceptance and Other Waivers......................................................... 22 Section 5.2 Modifications to ABL Documents and Term Documents.............................................. 23 Section 5.3 Reinstatement and Continuation of Agreement.................................................... 25 ARTICLE 6 INSOLVENCY PROCEEDINGS................................................................................. 26 Section 6.1 DIP Financing.................................................................................. 26 Section 6.2 Relief From Stay............................................................................... 26 Section 6.3 No Contest..................................................................................... 27 Section 6.4 Asset Sales.................................................................................... 27 Section 6.5 Separate Grants of Security and Separate Classification........................................ 27 Section 6.6 Enforceability................................................................................. 28 Section 6.7 ABL Obligations Unconditional.................................................................. 28 Section 6.8 Term Obligations Unconditional................................................................. 28 ARTICLE 7 MISCELLANEOUS.......................................................................................... 29 Section 7.1 Rights of Subrogation.......................................................................... 29 Section 7.2 Further Assurances............................................................................. 29 Section 7.3 Representations................................................................................ 29
i Section 7.4 Amendments..................................................................................... 30 Section 7.5 Addresses for Notices.......................................................................... 30 Section 7.6 No Waiver, Remedies............................................................................ 30 Section 7.7 Continuing Agreement, Transfer of Secured Obligations.......................................... 30 Section 7.8 Governing Law: Entire Agreement................................................................ 31 Section 7.9 Counterparts................................................................................... 31 Section 7.10 No Third Party Beneficiaries................................................................... 31 Section 7.11 Headings....................................................................................... 31 Section 7.12 Severability................................................................................... 31 Section 7.13 Attorneys Fees................................................................................. 31 Section 7.14 VENUE; JURY TRIAL WAIVER....................................................................... 32 Section 7.15 Intercreditor Agreement........................................................................ 32 Section 7.16 No Warranties or Liability..................................................................... 33 Section 7.17 Conflicts...................................................................................... 33 Section 7.18 Information Concerning Financial Condition of the Credit Parties............................... 33

ii INTERCREDITOR AGREEMENT THIS INTERCREDITOR AGREEMENT (this "AGREEMENT") is entered into as of June 10, 2004 between JPMORGAN CHASE BANK, in its capacity as administrative agent (in such capacity, the "ABL AGENT") for the financial institutions party from time to time to the Original ABL Credit Agreement referred to below (such financial institutions, together with their successors, assigns and transferees, the "CREDIT AGREEMENT LENDERS" and, together with affiliates thereof in their capacity as Bank Products Affiliates or Hedging Affiliates (in each case, as hereinafter defined), the "ABL LENDERS") and U.S. BANK NATIONAL ASSOCIATION, in its capacity as trustee and collateral agent (in such capacity, the "TERM AGENT") for the holders of the Senior Secured Notes referred to below (the "TERM NOTEHOLDERS"). RECITALS A. Pursuant to that certain Financing Agreement dated as of the date hereof by and among Milacron Inc., as a borrower ("MILACRON"), certain subsidiaries of Milacron, as additional borrowers (the "SUBSIDIARY BORROWERS" and, together with Milacron, the "BORROWERS", the Credit Agreement Lenders and the ABL Agent (as such agreement may be amended, supplemented, or modified from time to time, the "ORIGINAL ABL CREDIT AGREEMENT"), the Credit Agreement Lenders have agreed to make certain loans and other financial accommodations to or for the benefit of the Borrowers. B. Pursuant to certain guaranty agreements and security agreements dated as of the date hereof (including the guaranty set forth in the Original ABL Credit Agreement) (the "ABL GUARANTIES") by the ABL Guarantors in favor of the ABL Agent, the ABL Guarantors have agreed to guarantee the payment and performance of the Borrowers' obligations under the ABL Documents. C. As a condition to the effectiveness of the Original ABL Credit Agreement and to secure the obligations of the Borrowers and the ABL Guarantors (the Borrowers, the ABL Guarantors and each other direct or indirect affiliate or shareholder (or equivalent) of Milacron or any of its affiliates that is now or hereafter becomes a party to any ABL Document, collectively, the "ABL CREDIT PARTIES") under and in connection with the ABL Documents, the ABL Credit Parties have granted to the ABL Agent (for the benefit of the ABL Lenders including the Bank Products Affiliates and Hedging Affiliates) Liens on the Collateral. D. Pursuant to that certain Indenture dated as of the date hereof by and among Milacron, the Term Guarantors and U.S. Bank National Association, as trustee (as such agreement may be amended, supplemented, or modified from time to time, the "ORIGINAL TERM INDENTURE"), Milacron has issued the 11 -1/2 % Senior Secured Notes due May 15, 2011 in the aggregate amount of $225,000,000 (together with any additional notes issued thereunder, the "SENIOR SECURED NOTES"). E. Pursuant to the terms of the Term Indenture, the Term Guarantors have agreed to guarantee the payment and performance of Milacron's obligations under the Term Documents. F. As a condition to the effectiveness of the Term Indenture and to secure the obligations of Milacron and the Term Guarantors (Milacron, the Term Guarantors and each other direct or indirect affiliate or shareholder (or equivalent) of Milacron or any of its affiliates that is now or hereafter becomes a party to any Term Document, collectively, the "TERM CREDIT PARTIES)" under and in connection with the Term Documents, the Term Credit Parties have granted to the Term Agent (for the benefit of the Term Noteholders) Liens on the Collateral. G. Each of the ABL Agent (on behalf of the ABL Lenders) and the Term Loan Agent (on behalf of the Term Noteholders) and, by their acknowledgment hereof, the Credit Parties, desire to agree to the relative priority of Liens on the Collateral and certain other rights, priorities and interests as provided herein. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows: ARTICLE 1 DEFINITIONS SECTION 1.1 UCC DEFINITIONS. The following terms which are defined in the Uniform Commercial Code are used herein as so defined: Accounts, Chattel Paper, Deposit Accounts, Documents, Electronic Chattel Paper, Equipment, Financial Assets, Instruments, Inventory, Investment Property, Letter-of-Credit Rights, Money, Payment Intangibles, Promissory Notes, Records, Security, Securities Accounts, Security Entitlements, Supporting Obligations, and Tangible Chattel Paper. SECTION 1.2 OTHER DEFINITIONS. As used in this Agreement, the following terms shall have the meanings set forth below: "ABL AGENT" shall have the meaning assigned to that term in the introduction to this Agreement and shall include any successor thereto as well as any Person designated as the "Agent" under any ABL Credit Agreement. "ABL COLLATERAL DOCUMENTS" shall mean all "Security Agreements" as defined in the Original ABL Credit Agreement, and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any ABL Credit Agreement. "ABL CREDIT AGREEMENT" shall mean the Original ABL Credit Agreement and any other agreement extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the ABL Obligations, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder. "ABL CREDIT PARTIES" shall have the meaning assigned to that term in the recitals to this Agreement. "ABL DOCUMENTS" shall mean the ABL Credit Agreement, the ABL Guaranties, the ABL Collateral Documents, the Bank Product Agreements, the Hedging Agreements, those other ancillary agreements as to which the ABL Agent or any ABL Lender (including any Bank Products Affiliate and any Hedging Affiliate) is a party or a beneficiary and all other agreements, 2 instruments, documents and certificates, now or hereafter executed by or on behalf of any ABL Credit Party or any of its respective Subsidiaries or Affiliates, and delivered to the ABL Agent, in connection with any of the foregoing or any ABL Credit Agreement. "ABL GUARANTIES" shall have the meaning assigned to that term in the recitals to this Agreement. "ABL GUARANTORS" shall mean each subsidiary of Milacron listed on Schedule B hereto as an "ABL Guarantor" and any other Person who becomes a guarantor under any of the ABL Guaranties. "ABL LENDERS" shall have the meaning assigned to that term in the introduction to this Agreement and shall include all Bank Product Affiliates and Hedging Affiliates and all successors, assigns, transferees and replacements thereof, as well as any Person designated as a "Lender" under any ABL Credit Agreement. "ABL OBLIGATIONS" shall mean all of the "Obligations" as defined in the Original ABL Credit Agreement, and all other amounts owing or due under the terms of the ABL Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time. This term includes, without limitation, all interest, fees, charges, expenses, attorneys' fees and any other sum chargeable to any ABL Credit Party under any of the ABL Documents and shall also include, without limitation, all amounts that would become due and interest, fees and charges that would accrue but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code or any other provision of the Bankruptcy Code or any similar provision of any other applicable Debtor Relief Laws. "ABL PRIORITY COLLATERAL" shall mean all Collateral consisting of the following: (1) all Accounts and Receivables; (2) all Chattel Paper (including Tangible Chattel Paper and Electronic Chattel Paper); (3) (x) all Deposit Accounts and Money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein and (y) all Securities, Security Entitlements, and Securities Accounts, in each case, to the extent constituting cash or Cash Equivalents or representing a claim to Cash Equivalents, except, in each case, for (a) any Asset Sale Proceeds Account and all deposits and other funds held therein and (b) any Deposit Account or Money and all cash, checks, other negotiable instruments, funds and other evidences of payments held therein or any Securities Account and all cash and Cash Equivalents held therein, in each case, that constitute identifiable proceeds of Term Priority Collateral and all deposits and other funds held therein, but in any event and regardless of the foregoing clauses (a), (b) and (c), including the accounts listed on Schedule A hereto; (4) all Inventory; (5) to the extent involving or governing any of the items referred to in the preceding clauses (1) through (4), all Documents, General Intangibles, Instruments (including, without limitation, Promissory Notes), and Letter of Credit Rights, provided that to the extent any of the 3 foregoing also relates to Term Priority Collateral, only that portion related to the items referred to in the preceding clauses (1) through (4) shall be included in the ABL Priority Collateral; (6) to the extent evidencing or governing any of the items referred to in the preceding clauses (1) through (5), all Supporting Obligations; provided that to the extent any of the foregoing also relates to Term Priority Collateral only that portion related to the items referred to in the preceding clauses (1) through (5) shall be included in the ABL Priority Collateral; (7) all books and Records relating to the foregoing (including without limitation all books, databases, customer lists, engineer drawings, and Records, whether tangible or electronic which contain any information relating to any of the foregoing); (8) all Proceeds of any of the foregoing (including without limitation, all insurance proceeds) and all collateral security and guarantees given by any Person with respect to any of the foregoing; provided, however, that any Collateral, regardless of type, received in connection with a permitted disposition of or otherwise in exchange for ABL Priority Collateral pursuant to the terms of the Credit Agreement shall be treated as ABL Priority Collateral under this Agreement; and provided, further, that any Collateral regardless of type received in connection with a permitted disposition of or otherwise in exchange for Term Priority Collateral pursuant to the terms of the Term Indenture, shall be treated as Term Priority Collateral under this Agreement. "ABL SECURED PARTIES" shall mean the ABL Agent and the ABL Lenders. "AFFILIATE" shall mean (a) any Person controlling, controlled by or under common control with any other Person, (b) with respect to any Person, any other Person who is an officer, director, managing member, partner, trustee or beneficiary of such Person, and (c) any Person who is a spouse, sibling, parent, grandparent, child or grandchild of a Person described in clauses (a) or (b) preceding. For purposes of this definition, "control" (including "controlled by" and "under common control with") shall mean the possession, directly or indirectly, of the power to either (a) vote 10% or more of the voting securities of such Person or (b) direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. "AGREEMENT" shall mean this Intercreditor Agreement. "ASSET SALE PROCEEDS ACCOUNT" shall mean a segregated deposit account under the sole control of the Term Agent which contains only proceeds from the sale of Term Priority Collateral and any interest earned thereon. "BANK PRODUCTS AFFILIATE" shall mean any Affiliate of any Credit Agreement Lender that has entered into a Bank Products Agreement with an ABL Credit Party with the obligations of such ABL Credit Party thereunder being secured by one or more ABL Collateral Documents. "BANK PRODUCTS AGREEMENT" shall mean any agreement pursuant to which a bank or other financial institution agrees to provide treasury management services (including, without 4 limitation, controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services). "BANKRUPTCY CODE" shall mean title 11 of the United States Code. "CAPITAL STOCK" shall mean (a) in the case of a corporation, corporate stock, (b) in the case of an association, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock, (c) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited), and (d) 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 property of, the issuing Person. "CASH COLLATERAL" shall mean any Collateral consisting of Money or cash equivalents, any Security Entitlement and any Financial Assets. "CASH EQUIVALENTS" shall mean (i) marketable direct obligations issued or unconditionally guaranteed by the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case, maturing within six months from the date of acquisition thereof; (ii) commercial paper, maturing not more than 270 days after the date of issue rated P-1 by Moody's Investors Service, Inc. and any successor thereto ("MOODY'S") or A-1 by Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto ("STANDARD & POOR'S"); (iii) certificates of deposit maturing not more than 270 days after the date of issue, issued by commercial banking institutions and money market or demand deposit accounts maintained at commercial banking institutions, each of which is a member of the Federal Reserve System and has a combined capital and surplus and undivided profits of not less than $500,000,000; (iv) repurchase agreements having maturities of not more than 90 days from the date of acquisition which are entered into with major money center banks included in the commercial banking institutions described in clause (iii) above and which are secured by readily marketable direct obligations of the United States Government or any agency thereof, (v) money market accounts maintained with mutual funds having assets in excess of $2,500,000,000; and (vi) tax exempt securities rated A or higher by Moody's or A+ or higher by Standard & Poor's. "COLLATERAL" shall mean all Property now owned or hereafter acquired by any Borrower or any Guarantor in or upon which a Lien is granted or purported to be granted to the ABL Agent or the Term Agent under any of the ABL Collateral Documents or the Term Collateral Documents, together with all rents, issues, profits, products, and Proceeds thereof. "CONTROL COLLATERAL" shall mean any Collateral consisting of any Certificated Security, Investment Property, Deposit Account, and any other Collateral as to which a Lien may be perfected through possession or control by the secured party, or any agent therefor. "COPYRIGHT LICENSES" shall mean any and all agreements, whether written or oral, providing for the grant by or to any Credit Party of any right under any Copyright, including, without limitation, the grant of rights to manufacture, distribute, exploit and sell materials derived from any Copyright. 5 "COPYRIGHTS" shall mean (i) any and all other copyrights, in the United States or any other country, whether registered or unregistered, or published or unpublished, all registrations and recordings thereof and all applications in connection therewith, and (ii) the right to obtain all renewals of the foregoing. "CREDIT AGREEMENT LENDERS" shall have the meaning assigned to that term in the introduction to this Agreement. "CREDIT DOCUMENTS" shall mean the ABL Documents and the Term Documents. "CREDIT PARTIES" shall mean the ABL Credit Parties and the Term Credit Parties. "DEBTOR RELIEF LAWS" shall mean the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada) and all other liquidation, conservatorship, bankruptcy, assignment for benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or Canada or other applicable jurisdictions from time to time in effect affecting the rights of creditors generally. "DIP FINANCING" shall have the meaning set forth in Section 6.1. "DISCHARGE OF ABL OBLIGATIONS" shall mean (a) the payment in full of the ABL Obligations that are outstanding and unpaid at the time all indebtedness thereunder is paid in full including, with respect to amounts available to be drawn under outstanding letters of credit issued thereunder (or indemnities or other undertakings issued pursuant thereto in respect of outstanding letters of credit) delivery of Money or backstop letters of credit in respect thereof in compliance with the terms of any ABL Credit Agreement (which shall not exceed an amount equal to 105% of the aggregate undrawn amount of such letters of credit), (b) the termination of all commitments to extend credit under the ABL Documents, and (c) the delivery by the ABL Agent of a written notice to the Term Agent stating that the events described in clauses (a) and (b) have occurred to the satisfaction of the ABL Secured Parties. "DISCHARGE OF TERM OBLIGATIONS" shall mean (a) the payment in full of the Term Obligations that are outstanding and unpaid at the time the Senior Secured Notes are paid in full and (b) the delivery by the Term Agent of a written notice to the ABL Agent stating that the events described in clause (a) have occurred to the satisfaction of the Term Secured Parties. "EVENT OF DEFAULT" shall mean an Event of Default under any ABL Credit Agreement or the Term Indenture. "EXERCISE ANY SECURED CREDITOR REMEDIEs" or "EXERCISE OF SECURED CREDITOR REMEDIES" shall mean: (a) the taking of any action to enforce or realize upon any Lien, including the institution of any foreclosure proceedings or the noticing of any public or private sale pursuant to Article 9 of the Uniform Commercial Code; 6 (b) the exercise of any right or remedy provided to a secured creditor on account of a Lien under any of the Credit Documents, under applicable law, in an Insolvency Proceeding or otherwise, including the election to retain any of the Collateral in satisfaction of a Lien; (c) the taking of any action or the exercise of any right or remedy in respect of the collection on, set off against, marshaling of, or foreclosure on the Collateral or the Proceeds thereof; (d) the appointment of a receiver, receiver and manager or interim receiver of all or part of the Collateral; (e) the sale, lease, license, or other disposition of all or any portion of the Collateral by private or public sale or any other means permissible under applicable law; (f) the exercise of any other right of a secured creditor under Part 6 of Article 9 of the Uniform Commercial Code; (g) the exercise of any voting rights relating to any Capital Stock included in the Collateral; and (h) the delivery of any notice, claim or demand relating to the Collateral to any Person (including any securities intermediary, depository bank or landlord) in possession or control of any Collateral. For avoidance of doubt, filing a proof of claim in bankruptcy court or seeking adequate protection shall not be deemed to be an Exercise of Secured Creditor Remedies. "GENERAL INTANGIBLES" shall mean all "general intangibles" as such term is defined in the Uniform Commercial Code including, without limitation, with respect to any Credit Party, all contracts, agreements, instruments and indentures in any form, and portions thereof, to which such Credit Party is a party or under which such Credit Party has any right, title or interest or to which such Credit Party or any property of such Credit Party is subject, as the same may from time to time be amended, supplemented or otherwise modified, including, without limitation (but limited as aforesaid), (i) all rights of such Credit Party to receive moneys due and to become due to it thereunder or in connection therewith, (ii) all rights of such Credit Party to damages arising thereunder, (iii) all equity that constitutes "general intangibles" and (iv) all rights of such Credit Party to perform and to exercise all remedies thereunder. "GUARANTOR" shall mean any of the ABL Guarantors or Term Guarantors. "HEDGING AFFILIATE" shall mean any Affiliate of any Credit Agreement Lender that has entered into a Hedging Agreement with an ABL Credit Party with the obligations of such ABL Credit Party thereunder being secured by one or more ABL Collateral Documents. "HEDGING AGREEMENT" shall mean any interest rate, foreign currency, commodity or equity swap, collar, cap, floor or forward rate agreement, or other agreement or arrangement designed to protect against fluctuations in interest rates or currency, commodity or equity values (including, without limitation, any option with respect to any of the foregoing and any 7 combination of the foregoing agreements or arrangements), and any confirmation executed in connection with any such agreement or arrangement. "INSOLVENCY PROCEEDING" shall mean (a) any case, action or proceeding before any court or other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case covered by clauses (a) and (b) undertaken under United States Federal, State or foreign law, including the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada) and the Companies' Creditors Arrangement Act (Canada). "INTELLECTUAL PROPERTY" shall mean all rights, priorities and privileges provided under United States, multinational and foreign law relating to intellectual property, including without limitation, all Copyrights, Copyright Licenses, Patents, Patent Licenses, Trade Secrets, Trade Secret Licenses, Trademarks and Trademark Licenses, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom. "LIEN" shall mean any interest in Property securing an obligation owed to, or a claim by, a Person other than the owner of the Property, whether such interest is based on contract, constitutional, common, or statutory law, and including but not limited to the lien or security interest arising from a mortgage, encumbrance, pledge, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes or in the case of securities, any purchase option, call or similar right of a third party with respect to such securities. The term "Lien" shall include reservations, exceptions, encroachments, easements, rights of way, covenants, conditions, restrictions, liens and other statutory, constitutional, or common law rights of landlords, leases and other title exceptions and encumbrances affecting Property. "LIEN PRIORITY" shall mean with respect to any Lien of the ABL Agent or the Term Agent in the Collateral, the order of priority of such Lien as specified in Section 2.1. "PARTY" shall mean the ABL Agent or the Term Agent, and "PARTIES" shall mean both the ABL Agent and the Term Agent. "PATENT LICENSE" shall mean any and all agreements, whether written or oral, providing for the grant by or to any Credit Party of any right to manufacture, use or sell any invention covered in whole or in part by a Patent to the extent that a grant of a security interest in such patent license is not prohibited by applicable law or the applicable patent agreement. "PATENTS" shall mean (i) all letters patent of the United States or any other country and all reissues and extensions thereof, (ii) all applications for letters patent of the United States or any other country and all divisions, continuations and continuations-in-part thereof, and (iii) all rights to obtain any reissues or extensions of the foregoing. "PAYMENT COLLATERAL" shall mean all Accounts, Instruments, Chattel Paper, Letter-Of-Credit Rights, Deposit Accounts (other than the Deposit Accounts which constitute Term 8 Priority Collateral), Securities Accounts, and Payment Intangibles, together with all Supporting Obligations, in each case composing a portion of the Collateral. "PERSON" shall mean any natural person, corporation, limited liability company, unlimited liability company, limited partnership, general partnership, limited liability partnership, joint venture, trust, land trust, business trust, or other organization, irrespective of whether such organization is a legal entity, and shall include a government and any agency or political subdivision thereof. "PRIORITY COLLATERAL" shall mean the ABL Priority Collateral or the Term Priority Collateral. "PROCEEDS" shall mean (a) all "proceeds," as defined in Article 9 of the Uniform Commercial Code, with respect to the Collateral, and (b) whatever is recoverable or recovered when any Collateral is sold, exchanged, collected, or disposed of, whether voluntarily or involuntarily. "PROPERTY" shall mean any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible. "REAL PROPERTY" shall mean any right, title or interest in and to real property, including any fee interest, leasehold interest, easement, or license and any other right to use or occupy real property, including any right arising by contract. "RECEIVABLE" shall mean any right to payment for goods sold or leased or for services rendered, whether or not such right is evidenced by an Instrument or Chattel Paper and whether or not it has been earned by performance (including, without limitation, any Account). "RECOVERY" shall have the meaning set forth in Section 5.3. "SECURED PARTIES" shall mean the ABL Secured Parties or the Term Secured Parties. "SENIOR SECURED NOTES" shall have the meaning assigned to that term in the recitals to this Agreement. "SUBSIDIARY" of any Person shall mean a corporation, limited liability company, partnership or other entity of which a majority of the outstanding shares of stock of each class having ordinary voting power or other equity interests is owned by such Person, by one or more Subsidiaries of such Person, or by such Person and one or more of its Subsidiaries. "TERM AGENT" shall have the meaning assigned to that term in the introduction to this Agreement and shall include any successor trustee or collateral agent appointed under the Term Indenture or the Term Collateral Documents and any agent of any of the foregoing. "TERM COLLATERAL DOCUMENTS" shall mean all "Security Documents" as defined in the Term Indenture, and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with the Term Indenture. 9 "TERM CREDIT PARTIES" shall have the meaning assigned to that term in the recitals to this Agreement." "TERM DOCUMENTS" shall mean the Term Indenture, the Senior Secured Notes, the Term Collateral Documents, the Term Registration Rights Agreement, those other ancillary agreements as to which the Term Agent or any Term Noteholder is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Term Credit Party or any of its respective Subsidiaries or Affiliates, and delivered to the Term Agent, in connection with the foregoing or the transactions contemplated thereby. "TERM GUARANTORS" shall mean each subsidiary of Milacron listed on Schedule B hereto as a "Term Guarantor" and any other Person who becomes a guarantor under the Term Indenture. "TERM INDENTURE" shall mean the Original Term Indenture and any other agreement extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the Term Obligations, whether by the same or any other trustee, lender, noteholder or group of lenders or noteholders and whether or not increasing the amount of any Indebtedness that may be incurred or issued thereunder. "TERM NOTEHOLDERS" shall have the meaning assigned to that term in the introduction to this Agreement and shall include each successor and assign thereof. "TERM OBLIGATIONS" shall mean all liabilities and obligations of Milacron and the Term Guarantors evidenced by the Senior Secured Notes or arising under any of the Term Documents, and any amendments, restatements, modifications, renewals, extensions, replacements, refundings or refinancing, in whole or in part, of any of the foregoing purported to be secured by the Collateral. This term includes, without limitation, all interest, fees, charges, expenses, attorneys' fees and any other sum chargeable to any Term Credit Party under any of the Term Documents and shall also include, without limitation, all amounts that would become due and interest, fees and charges that would accrue but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code or any other provision of the Bankruptcy Code or any similar provision of any other applicable Debtor Relief Laws. "TERM PRIORITY COLLATERAL" shall mean all Collateral, other than the ABL Priority Collateral; provided, however, that any Collateral, regardless of type, received in connection with a permitted disposition of or otherwise in exchange for Term Priority Collateral pursuant to the terms of the Term Indenture shall be treated as Term Priority Collateral under this Agreement; provided, further, that any Collateral regardless of type received in connection with a permitted disposition of or otherwise in exchange for ABL Priority Collateral pursuant to the terms of the Credit Agreement, shall be treated as ABL Priority Collateral under this Agreement. "TERM REGISTRATION RIGHTS AGREEMENT" shall mean the Registration Rights Agreement as defined in the Term Indenture. "TERM SECURED PARTIES" shall mean the Term Agent and the Term Noteholders. "TRADE SECRET LICENSES" shall mean any and all agreements, whether written or oral, providing for the grant by or to any Credit Party of any right in or to Trade Secrets, to the extent 10 that a grant of a security interest in such Trade Secret License is not prohibited by applicable law or the applicable Trade Secret License. "TRADE SECRETS" shall mean all trade secrets and all other confidential or proprietary information and know-how whether or not such trade secret has been reduced to a writing or other tangible form, including all documents and things embodying, incorporating, or referring in any way to such trade secret, including but not limited to: (a) the right to sue for past, present and future misappropriation or other violation of any trade secret, and (b) all Proceeds of the foregoing, including, without limitation, licenses, royalties, income, payments, claims, damages, and proceeds of suit. "TRADEMARK LICENSE" shall mean any and all agreements, whether written or oral, providing for the grant by or to any Credit Party of any right to use any Trademark, to the extent that a grant of a security interest in such Trademark License is not prohibited by applicable law or the applicable Trademark License. "TRADEMARKS" shall mean (a) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos and other source or business identifiers, and all goodwill associated therewith, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or any other country or any political subdivision thereof, or otherwise, and all common-law rights related thereto, and (b) the right to obtain all renewals thereof. "UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York; provided that to the extent that the Uniform Commercial Code is used to define any term in any security document and such term is defined differently in differing Articles of the Uniform Commercial Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, publication or priority of, or remedies with respect to, Liens of any Party is governed by the Uniform Commercial Code or foreign personal property security laws as enacted and in effect in a jurisdiction other than the State of New York, the term "Uniform Commercial Code" will mean the Uniform Commercial Code or such foreign personal property security laws as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions. SECTION 1.3 RULES OF CONSTRUCTION. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term "including" is not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Article, section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, 11 replacements, substitutions, joinders, and supplements thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to any Person shall be construed to include such Person's successors and assigns. Any reference herein to the repayment in full of an obligation shall mean the payment in full in cash of such obligation. ARTICLE 2 LIEN PRIORITY SECTION 2.1 AGREEMENT TO SUBORDINATE. (a) Notwithstanding (i) the date, time, method, manner, or order of grant, attachment, or perfection (including any defect or deficiency or alleged defect or deficiency in any of the foregoing) of any Liens granted to the ABL Agent or the ABL Lenders in respect of all or any portion of the Collateral or of any Liens granted to the Term Agent or the Term Noteholders in respect of all or any portion of the Collateral and regardless of how any such Lien was acquired (whether by grant, statute, operation of law, subrogation or otherwise), (ii) the order or time of filing or recordation of any document or instrument for perfecting the Liens in favor of the ABL Agent or the Term Agent (or ABL Lender or Term Noteholder) in any Collateral, (iii) any provision of the Uniform Commercial Code, the Bankruptcy Code or any other applicable law, or of the ABL Documents or the Term Documents, (iv) whether the ABL Agent or the Term Agent, in each case, either directly or through agents, holds possession of, or has control over, all or any part of the Collateral, (v) the fact that any such Liens in favor of the ABL Agent or the ABL Lenders or the Term Agent or the Term Noteholders securing any of the ABL Obligations or Term Obligations, respectively, are (x) subordinated to any Lien securing any obligation of any Credit Party other than the Term Obligations or the ABL Obligations, respectively, or (y) otherwise subordinated, voided, avoided, invalidated or lapsed or (vi) any other circumstance of any kind or nature whatsoever, the ABL Agent, on behalf of itself and the ABL Lenders, and the Term Agent, on behalf of itself and the Term Noteholders, hereby agree that: (1) any Lien in respect of all or any portion of the ABL Priority Collateral now or hereafter held by or on behalf of the Term Agent or any Term Noteholder that secures all or any portion of the Term Obligations shall in all respects be junior and subordinate to all Liens granted to the ABL Agent and the ABL Lenders in the ABL Priority Collateral to secure all or any portion of the ABL Obligations; (2) any Lien in respect of all or any portion of the ABL Priority Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Lender that secures all or any portion of the ABL Obligations shall in all respects be senior and prior to all Liens granted to the Term Agent or any Term Noteholder in the ABL Priority Collateral to secure all or any portion of the Term Obligations; 12 (3) any Lien in respect of all or any portion of the Term Priority Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Lender that secures all or any portion of the ABL Obligations shall in all respects be junior and subordinate to all Liens granted to the Term Agent and the Term Noteholders in the Term Priority Collateral to secure all or any portion of the Term Obligations; and (4) any Lien in respect of all or any portion of the Term Priority Collateral now or hereafter held by or on behalf of the Term Agent or any Term Noteholder that secures all or any portion of the Term Obligations shall in all respects be senior and prior to all Liens granted to the ABL Agent or any ABL Lender in the Term Priority Collateral to secure all or any portion of the ABL Obligations. (b) Notwithstanding any failure by any ABL Secured Party or Term Secured Party to perfect its security interests in the Collateral or any avoidance, invalidation or subordination by any third party or court of competent jurisdiction of the security interests in the Collateral granted to the ABL Secured Parties or the Term Secured parties, the priority and rights as between the ABL Secured Parties and the Term Secured Parties with respect to the Collateral shall be as set forth herein. (c) The Term Agent, for and on behalf of itself and the Term Noteholders, acknowledges and agrees that, concurrently herewith, the ABL Agent, for the benefit of itself and the ABL Lenders, has been granted Liens upon all of the Collateral in which the Term Agent has been granted Liens and the Term Agent hereby consents thereto. The ABL Agent, for and on behalf of itself and the ABL Lenders, acknowledges and agrees that, concurrently herewith, the Term Agent, for the benefit of itself and the Term Noteholders, has been granted Liens upon all of the Collateral in which the ABL Agent has been granted Liens and the ABL Agent hereby consents thereto. The subordination of Liens by the Term Agent and the ABL Agent in favor of one another as set forth herein shall not be deemed to subordinate the Term Agent's Liens or the ABL Agent's Liens to the Liens of any other Person. SECTION 2.2 WAIVER OF RIGHT TO CONTEST LIENS. (a) The Term Agent, for and on behalf of itself and the Term Noteholders, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the ABL Agent in respect of the Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the Term Agent, for itself and on behalf of the Term Noteholders, agrees that none of the Term Agent or the Term Noteholders will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the ABL Agent under the ABL Documents with respect to the ABL Priority Collateral. Except to the extent expressly set forth in this Agreement, the Term Agent, for itself and on behalf of the Term Noteholders, hereby waives any and all rights it or the Term Noteholders may have as a junior lien creditor or 13 otherwise to contest, protest, object to, or interfere with the manner in which the ABL Agent seeks to enforce its Liens in any ABL Priority Collateral. (b) The ABL Agent, for and on behalf of itself and the ABL Lenders, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the Term Agent in respect of the Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the ABL Agent, for itself and on behalf of the ABL Lenders, agrees that none of the ABL Agent or the ABL Lenders will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the Term Agent or any Term Noteholder under the Term Documents with respect to the Term Priority Collateral. Except to the extent expressly set forth in this Agreement, the ABL Agent, for itself and on behalf of the ABL Lenders, hereby waives any and all rights it or the ABL Lenders may have as a junior lien creditor or otherwise to contest, protest, object to, interfere with the manner in which the Term Agent or any Term Noteholder seeks to enforce its Liens in any Term Priority Collateral. SECTION 2.3 REMEDIES STANDSTILL. (a) The Term Agent, on behalf of itself and the Term Noteholders, agrees that, until the date upon which the Discharge of ABL Obligations shall have occurred, neither the Term Agent nor any Term Noteholder will Exercise Any Secured Creditor Remedies with respect to any of the ABL Priority Collateral without the written consent of the ABL Agent, and will not take, receive or accept any Proceeds of ABL Priority Collateral, it being understood and agreed that the temporary deposit of Proceeds of ABL Priority Collateral in a Deposit Account controlled by the Term Agent shall not constitute a breach of this Agreement so long as such Proceeds are promptly remitted to the ABL Agent. From and after the date upon which the Discharge of ABL Obligations shall have occurred (or prior thereto upon obtaining the written consent of the ABL Agent), the Term Agent or any Term Noteholder may Exercise Any Secured Creditor Remedies under the Term Documents or applicable law as to any ABL Priority Collateral; provided, however, that any Exercise of Secured Creditor Remedies with respect to any Collateral by the Term Agent is at all times subject to the provisions of this Agreement, including Section 4.1 hereof. (b) The ABL Agent, on behalf of itself and the ABL Lenders, agrees that, until the date upon which the Discharge of Term Obligations shall have occurred, neither the ABL Agent nor any ABL Lender will Exercise Any Secured Creditor Remedies with respect to the Term Priority Collateral without the written consent of the Term Agent, and will not take, receive or accept any Proceeds of the Term Priority Collateral, it being understood and agreed that the temporary deposit of Proceeds of Term Priority Collateral in a Deposit Account controlled by the ABL Agent shall not constitute a breach of this Agreement so long as such Proceeds are promptly remitted to the Term Agent. From and after the date upon which the Discharge of Term Obligations shall have occurred (or prior thereto upon obtaining the written consent of the Term Agent), the ABL Agent or any ABL Lender may Exercise Any Secured Creditor Remedies under the ABL Documents or applicable law as to any Term Priority Collateral; provided, however, that any Exercise of Secured Creditor Remedies with respect to 14 any Collateral by the ABL Agent is at all times subject to the provisions of this Agreement, including Section 4.1 hereof. SECTION 2.4 EXERCISE OF RIGHTS. (a) Notice of ABL Agent's Lien. Without limiting Section 2.3 hereof, the Term Agent, for and on behalf of itself and the Term Noteholders, hereby agrees that, until the date upon which the Discharge of ABL Obligations shall have occurred, in connection with any Exercise of Secured Creditor Remedies by the Term Agent or any Term Noteholder with respect to any ABL Priority Collateral, the Term Agent or such Term Noteholder, as applicable, shall advise any purchaser or transferee of any ABL Priority Collateral in writing that the sale (whether public, private, by foreclosure, or otherwise) or other transfer is subject to the Liens of the ABL Agent. In addition, the Term Agent agrees, for and on behalf of itself and the Term Noteholders, that, until the date upon which the Discharge of ABL Obligations shall have occurred, any notice of any proposed foreclosure or sale of any ABL Priority Collateral and any other notice in connection with the Exercise of Secured Creditor Remedies with respect thereto shall state prominently and clearly that the sale is subject to the ABL Agent's prior Liens and that such Liens shall continue as against the ABL Priority Collateral to be sold. (b) Notice of Term Agent's Lien. Without limiting Section 2.3 hereof, the ABL Agent, for and on behalf of itself and the ABL Lenders, hereby agrees that, until the date upon which the Discharge of Term Obligations shall have occurred, in connection with any Exercise of Secured Creditor Remedies by the ABL Agent or any ABL Lender with respect to the Term Priority Collateral, the ABL Agent or such ABL Lender, as applicable, shall advise any purchaser or transferee of any Term Priority Collateral in writing that the sale (whether public, private, by foreclosure, or otherwise) or other transfer is subject to the Liens of the Term Agent. In addition, the ABL Agent agrees, for and on behalf of itself and the ABL Lenders, that, until the date upon which the Discharge of Term Obligations shall have occurred, any notice of any proposed foreclosure or sale of any Term Priority Collateral and any other notice in connection with the Exercise of Secured Creditor Remedies with respect thereto shall state prominently and clearly that the sale is subject to the Term Agent's prior Liens and that such Liens shall continue as against the Term Priority Collateral to be sold. (c) No Other Restrictions. Except as expressly set forth in this Agreement, each of the Term Agent, each Term Noteholder, the ABL Agent, and each ABL Lender shall have any and all rights and remedies it may have as a creditor under applicable law, including the right to the Exercise of Secured Creditor Remedies; provided, however, that the Exercise of Secured Creditor Remedies with respect to the Collateral shall be subject to the Lien Priority and to the provisions of this Agreement, including Section 4.1 hereof. The ABL Agent may enforce the provisions of the ABL Documents, the Term Agent may enforce the provisions of the Term Documents and each may Exercise Any Secured Creditor Remedies, all in such order and in such manner as each may determine in the exercise of its sole discretion, consistent with the terms of this Agreement and mandatory provisions of applicable law; provided, however, that each of the ABL Agent and the Term Agent agrees to provide to the other copies of any notices that it is required under applicable law to deliver to any Borrower or any Guarantor; provided further, however, that the ABL Agent's failure to provide any such copies to the Term Agent shall not impair any of the ABL Agent's rights hereunder or under any of the ABL Documents and the 15 Term Agent's failure to provide any such copies to the ABL Agent shall not impair any of the Term Agent's rights hereunder or under any of the Term Documents. Each of the Term Agent, each Term Noteholder, the ABL Agent and each ABL Lender agrees that it will not institute any suit or other proceeding or assert in any suit, Insolvency Proceeding or other proceeding any claim, in the case of the Term Agent and each Term Noteholder, against either the ABL Agent or any other ABL Secured Party, and in the case of the ABL Agent and each ABL Secured Party, against either the Term Agent or any other Term Secured Party, seeking damages from or other relief by way of specific performance, instructions or otherwise, with respect to, any action taken or omitted to be taken by such Person with respect to the Collateral which is consistent with the terms of this Agreement, and none of such Parties shall be liable for any such action taken or omitted to be taken. (d) Release of Liens. (i) In the event of any private or public sale of all or any portion of the ABL Priority Collateral in connection with any Exercise of Secured Creditor Remedies by or with the consent of the ABL Agent at any time prior to the date upon which the Discharge of ABL Obligations shall have occurred (and irrespective of whether an Event of Default has occurred), the Term Agent agrees, on behalf of itself and the Term Noteholders, that so long as the net cash proceeds of any such sale are applied as provided in Section 4.1 hereof, such sale will be free and clear of the Liens on such ABL Priority Collateral securing the Term Obligations. In furtherance thereof, the Term Agent agrees that it will execute any and all Lien releases or other documents reasonably requested by the ABL Agent in connection therewith, so long as the net cash proceeds from such sale or other disposition of such ABL Priority Collateral are applied in accordance with the terms of this Agreement. The Term Agent hereby appoints the ABL Agent and any officer or duly authorized person of the ABL Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of the Term Agent and in the name of the Term Agent or in the ABL Agent's own name, from time to time, in the ABL Agent's sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including, without limitation, any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable). (ii) In the event of any private or public sale of all or any portion of the Term Priority Collateral in connection with any Exercise of Secured Creditor Remedies by or with the consent of the Term Agent at any time prior to the date upon which the Discharge of Term Obligations shall have occurred (and irrespective of whether an Event of Default has occurred), the ABL Agent agrees, on behalf of itself and the ABL Lenders, that so long as the net cash proceeds of any such sale are applied as provided in Section 4.1 hereof, such sale will be free and clear of the Liens on such Term Priority Collateral securing the ABL Obligations. In furtherance thereof, the ABL Agent agrees that it will execute any and all Lien releases or other documents reasonably requested by the Term Agent in connection therewith, so long as the net cash proceeds from such sale or other 16 disposition of such Term Priority Collateral are applied in accordance with the terms of this Agreement. The ABL Agent hereby appoints the Term Agent and any officer or duly authorized person of the Term Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of the ABL Agent and in the name of the ABL Agent or in the Term Agent's own name, from time to time, in the Term Agent's sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including, without limitation, any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable). SECTION 2.5 NO NEW LIENS. (a) Until the date upon which the Discharge of ABL Obligations shall have occurred, the parties hereto agree that no Term Secured Party shall acquire or hold any Lien on any assets of any Credit Party securing any Term Obligation which assets are not also subject to the Lien of the ABL Agent under the ABL Documents, subject to the Lien Priority set forth herein. If any Term Secured Party shall (nonetheless and in breach hereof) acquire or hold any Lien on any assets of any Credit Party securing any Term Obligation which assets are not also subject to the Lien of the ABL Agent under the ABL Documents, subject to the Lien Priority set forth herein, then the Term Agent (or the relevant Term Secured Party) shall, without the need for any further consent of any other Term Secured Party and notwithstanding anything to the contrary in any other Term Document be deemed to also hold and have held such lien for the benefit of the ABL Agent as security for the ABL Obligations (subject to the Lien Priority and other terms hereof) and shall promptly notify the ABL Agent in writing of the existence of such Lien. (b) Until the date upon which the Discharge of Term Obligations shall have occurred, the parties hereto agree that no ABL Secured Party shall acquire or hold any Lien on any assets of any Credit Party securing any ABL Obligation which assets are not also subject to the Lien of the Term Agent under the Term Documents, subject to the Lien Priority set forth herein. If any ABL Secured Party shall (nonetheless and in breach hereof) acquire or hold any Lien on any assets of any Credit Party securing any ABL Obligation which assets are not also subject to the Lien of the Term Agent under the Term Documents, subject to the Lien Priority set forth herein, then the ABL Agent (or the relevant ABL Secured Party) shall, without the need for any further consent of any other ABL Secured Party and notwithstanding anything to the contrary in any other ABL Document be deemed to also hold and have held such lien for the benefit of the Term Agent as security for the Term Obligations (subject to the Lien Priority and other terms hereof) and shall promptly notify the Term Agent in writing of the existence of such Lien. ARTICLE 3 ACTIONS OF THE PARTIES SECTION 3.1 CERTAIN ACTIONS PERMITTED. The Term Agent and the ABL Agent may make such demands or file such claims in respect of the Term Obligations or the ABL Obligations, as applicable, as are necessary to prevent the waiver or bar of such claims 17 under applicable statutes of limitations or other statutes, court orders, or rules of procedure at any time. SECTION 3.2 AGENT FOR PERFECTION. The ABL Agent, for and on behalf of itself and each ABL Lender, and the Term Agent, for and on behalf of itself and each Term Noteholder, as applicable, each agree to hold all Control Collateral and Cash Collateral that is part of the Collateral in their respective possession, custody, or control (or in the possession, custody, or control of agents or bailees for either) as representative for the other solely for the purpose of perfecting the security interest granted to each in such Control Collateral or Cash Collateral, subject to the terms and conditions of this Section 3.2. None of the ABL Agent, the ABL Lenders, the Term Agent, or the Term Noteholders, as applicable, shall have any obligation whatsoever to the others to assure that the Control Collateral is genuine or owned by any Borrower, any Guarantor, or any other Person or to preserve rights or benefits of any Person. The duties or responsibilities of the ABL Agent and the Term Agent under this Section 3.2 are and shall be limited solely to holding or maintaining control of the Control Collateral and the Cash Collateral as representative for the other Party for purposes of perfecting the Lien held by the Term Agent or the ABL Agent, as applicable. The ABL Agent is not and shall not be deemed to be a fiduciary of any kind for the Term Agent, the Term Noteholders, or any other Person. The Term Agent is not and shall not be deemed to be a fiduciary of any kind for the ABL Agent, the ABL Lenders, or any other Person. In the event that (a) the Term Agent or any Term Noteholder receives any Collateral or Proceeds of the Collateral in violation of the terms of this Agreement, or (b) the ABL Agent or any ABL Lender receives any Collateral or Proceeds of the Collateral in violation of the terms of this Agreement, then the Term Agent, such Term Noteholder, the ABL Agent, or such ABL Lender, as applicable, shall promptly pay over such Proceeds or Collateral to (i) in the case of clause (a), the ABL Agent, or (ii) in the case of clause (b), the Term Agent, in each case, in the same form as received with any necessary endorsements, for application in accordance with the provisions of Section 4.1 of this Agreement. SECTION 3.3 SHARING OF INFORMATION AND ACCESS. In the event that the ABL Agent shall, in the exercise of its rights under the ABL Collateral Documents or otherwise, receive possession or control of any books and Records of any Term Credit Party which contain information identifying or pertaining to the Term Priority Collateral, the ABL Agent shall, upon request from the Term Agent and as promptly as practicable thereafter, either make available to the Term Agent such books and Records for inspection and duplication or provide to the Term Agent copies thereof. In the event that the Term Agent shall, in the exercise of its rights under the Term Collateral Documents or otherwise, receive possession or control of any books and records of any ABL Credit Party which contain information identifying or pertaining to any of the ABL Priority Collateral, the Term Agent shall, upon request from the ABL Agent and as promptly as practicable thereafter, either make available to the ABL Agent such books and records for inspection and duplication or provide the ABL Agent copies thereof. In the event that the Term Agent shall, in the exercise of its rights under the Term Collateral Documents or otherwise, obtain title to any Intellectual Property previously owned by any of the ABL Credit Parties, the Term Agent hereby irrevocably grants the ABL Agent a non-exclusive license or other right to use, without charge, such Intellectual Property as it pertains to the ABL Priority Collateral in advertising for sale and selling any ABL Priority Collateral. 18 SECTION 3.4 INSURANCE. Proceeds of Collateral include insurance proceeds and therefore the Lien Priority shall govern the ultimate disposition of casualty insurance proceeds. The ABL Agent shall be named as additional insured or loss payee, as applicable, with respect to all insurance policies relating to ABL Priority Collateral and the Term Agent shall be named as additional insured or loss payee, as applicable, with respect to all insurance policies relating to Term Priority Collateral. The ABL Agent shall have the sole and exclusive right, as against the Term Agent, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of ABL Priority Collateral. The Term Agent shall have the sole and exclusive right, as against the ABL Agent, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of Term Priority Collateral. All proceeds of such insurance shall be remitted to the ABL Agent or the Term Agent, as the case may be, and each of the Term Agent and ABL Agent shall cooperate (if necessary) in a reasonable manner in effecting the payment of insurance proceeds in accordance with Section 4.1 hereof. SECTION 3.5 NO ADDITIONAL RIGHTS FOR THE CREDIT PARTIES HEREUNDER. Except as provided in Section 3.6, if any ABL Secured Party or Term Secured Party shall enforce its rights or remedies in violation of the terms of this Agreement, the Credit Parties shall not be entitled to use such violation as a defense to any action by any ABL Secured Party or Term Secured Party, nor to assert such violation as a counterclaim or basis for set off or recoupment against any ABL Secured Party or Term Secured Party. SECTION 3.6 ACTIONS UPON BREACH. If any Term Secured Party or any ABL Secured Party, contrary to this Agreement, commences or participates in any action or proceeding against the Credit Parties or the Collateral, the Credit Parties, with the prior written consent of the ABL Agent or the Term Agent, as applicable, may interpose as a defense or dilatory plea the making of this Agreement, and any ABL Secured Party or Term Secured Party, as applicable, may intervene and interpose such defense or plea in its or their name or in the name of the Credit Parties. SECTION 3.7 INSPECTION RIGHTS AND INSURANCE. (a) Without limiting any rights the ABL Agent or any other ABL Secured Party may otherwise have under applicable law or by agreement, the ABL Agent and the ABL Secured Parties may, at any time and whether or not the Term Agent or any other Term Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies (the "ABL PERMITTED ACCESS RIGHT"), during normal business hours on any business day, access ABL Priority Collateral that (A) is stored or located in or on, (B) has become an accession with respect to (within the meaning of Section 9-335 of the Uniform Commercial Code), or (C) has been commingled with (within the meaning of Section 9-336 of the Uniform Commercial Code), Term Priority Collateral (collectively, the "ABL COMMINGLED COLLATERAL"), for the limited purposes of assembling, inspecting, copying or downloading information stored on, taking actions to perfect its Lien on, completing a production run of inventory involving, taking possession of, moving, selling storing or otherwise dealing with, or to Exercise Any Secured Creditor Remedies with respect to, the ABL Commingled Collateral (collectively, "ABL PERMITTED ACCESS PURPOSES"), in each case without notice to, the involvement of or interference by any Term Secured Party or liability to any Term Secured Party. In addition, subject to the terms hereof, the ABL Agent may advertise and conduct public auctions or private sales of the ABL Priority Collateral without notice to, the involvement of or interference by any Term Secured Party or liability to any Term Secured Party. 19 (b) The Term Agent and the other Term Secured Parties shall use commercially reasonable efforts to not hinder or obstruct the ABL Agent and the other ABL Secured Parties from exercising the ABL Permitted Access Right. (c) Subject to the terms hereof, the Term Agent may advertise and conduct public auctions or private sales of the Term Priority Collateral without notice to, the involvement of or interference by any ABL Secured Party or liability to any ABL Secured Party. ARTICLE 4 APPLICATION OF PROCEEDS SECTION 4.1 APPLICATION OF PROCEEDS. (a) Revolving Nature of ABL Obligations. The Term Agent, for and on behalf of itself and the Term Noteholders, expressly acknowledges and agrees that (i) any ABL Credit Agreement is a revolving commitment, that in the ordinary course of business, the ABL Agent and the ABL Lenders will apply payments and make advances thereunder, and that no application of any Payment Collateral or Cash Collateral or the release of any Lien by the ABL Agent upon any portion of the Collateral in connection with a permitted disposition under any ABL Credit Agreement shall constitute the Exercise of Secured Creditor Remedies under this Agreement; (ii) the amount of the ABL Obligations that may be outstanding at any time or from time to time may be increased or reduced and subsequently reborrowed, and that the terms of the ABL Obligations may be modified, extended or amended from time to time, and that the aggregate amount of the ABL Obligations may be increased, replaced or refinanced, in each event, without notice to or consent by the Term Secured Parties and without affecting the provisions hereof; and (iii) all Payment Collateral or Cash Collateral received by the ABL Agent may be applied, reversed, reapplied, credited, or reborrowed, in whole or in part, to the ABL Obligations at any time; provided, however, that from and after the date on which the ABL Agent (or any ABL Lender) commences the Exercise of Any Secured Creditor Remedies, all amounts received by the ABL Agent or any ABL Lender shall be applied as specified in this Section 4.1. The Lien Priority shall not be altered or otherwise affected by any such amendment, modification, supplement, extension, repayment, reborrowing, increase, replacement, renewal, restatement or refinancing of either the ABL Obligations or the Term Obligations, or any portion thereof. (b) Application of Proceeds of ABL Priority Collateral. The ABL Agent and the Term Agent hereby agree that all ABL Priority Collateral, and all Proceeds thereof, received by either of them in connection with any Exercise of Secured Creditor Remedies shall be applied, first, to the payment of costs and expenses of the ABL Agent or the Term Agent, as applicable, in connection with such Exercise of Secured Creditor Remedies, second, to the payment of the ABL Obligations in accordance with the ABL Documents until the Discharge of ABL Obligations shall have occurred, third, to the payment of the Term Obligations, and 20 fourth, the balance, if any, to the Credit Parties or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct. (c) Application of Proceeds of Term Priority Collateral. The ABL Agent and the Term Agent hereby agree that all Term Priority Collateral, and all Proceeds thereof, received by either of them in connection with any Exercise of Secured Creditor Remedies shall be applied, first, to the payment of costs and expenses of the ABL Agent or the Term Agent, as applicable, in connection with such Exercise of Secured Creditor Remedies, second, to the payment of the Term Obligations in accordance with the Term Documents until the Discharge of Term Obligations shall have occurred, third, to the payment of the ABL Obligations; and fourth, the balance, if any, to the Credit Parties or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct. (d) Limited Obligation or Liability. In exercising remedies, whether as a secured creditor or otherwise, the ABL Agent shall have no obligation or liability to the Term Agent or to any Term Noteholder, and the Term Agent shall have no obligation or liability to the ABL Agent or any ABL Lender, regarding the adequacy of any Proceeds or for any action or omission, save and except solely for an action or omission that breaches the express obligations undertaken by each Party under the terms of this Agreement. (e) Turnover of Cash Collateral After Discharge. Upon the Discharge of ABL Obligations, the ABL Agent shall deliver to the Term Agent or shall execute such documents as the Term Agent may reasonably request to enable the Term Agent to have control over any Cash Collateral or Control Collateral still in the ABL Agent's possession, custody, or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct. Upon the Discharge of Term Obligations, the Term Agent shall deliver to the ABL Agent or shall execute such documents as the ABL Agent may reasonably request to enable the ABL Agent to have control over any Cash Collateral or Control Collateral still in the Term Agent's possession, custody or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct. SECTION 4.2 SPECIFIC PERFORMANCE. Each of the ABL Agent and the Term Agent is hereby authorized to demand specific performance of this Agreement, whether or not any Borrower or any Guarantor shall have complied with any of the provisions of any of the Credit Documents, at any time when the other Party shall have failed to comply with any of the provisions of this Agreement applicable to it. Each of the ABL Agent, for and on behalf of itself and the ABL Lenders, and the Term Agent, for and on behalf of itself and the Term Noteholders, hereby irrevocably waives any defense based on the adequacy of a remedy at law that might be asserted as a bar to such remedy of specific performance. 21 ARTICLE 5 INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS SECTION 5.1 NOTICE OF ACCEPTANCE AND OTHER WAIVERS. (a) All ABL Obligations at any time made or incurred by any Borrower or any Guarantor shall be deemed to have been made or incurred in reliance upon this Agreement, and the Term Agent, on behalf of itself and the Term Noteholders, hereby waives notice of acceptance, or proof of reliance by the ABL Agent or any ABL Lender of this Agreement, and notice of the existence, renewal, extension, accrual, creation, or non-payment of all or any part of the ABL Obligations. All Term Obligations at any time made or incurred by any Borrower or any Guarantor shall be deemed to have been made or incurred in reliance upon this Agreement, and the ABL Agent, on behalf of itself and the ABL Lenders, hereby waives notice of acceptance, or proof of reliance, by the Term Agent or any Term Noteholder of this Agreement, and notice of the existence, renewal, extension, accrual, creation, or non-payment of all or any part of the Term Obligations. (b) None of the ABL Agent, any ABL Lender, or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. If the ABL Agent or any ABL Lender honors (or fails to honor) a request by any Borrower for an extension of credit pursuant to any ABL Credit Agreement or any of the other ABL Documents, whether the ABL Agent or any ABL Lender has knowledge that the honoring of (or failure to honor) any such request would constitute a default under the terms of the Term Indenture or any other Term Document (but not a default under this Agreement) or an act, condition, or event that, with the giving of notice or the passage of time, or both, would constitute such a default, or if the ABL Agent or any ABL Lender otherwise should exercise any of its contractual rights or remedies under any ABL Documents (subject to the express terms and conditions hereof), neither the ABL Agent nor any ABL Lender shall have any liability whatsoever to the Term Agent or any Term Noteholder as a result of such action, omission, or exercise (so long as any such exercise does not breach the express terms and provisions of this Agreement). The ABL Agent and the ABL Lenders shall be entitled to manage and supervise their loans and extensions of credit under any ABL Credit Agreement and any of the other ABL Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the Term Agent or any of the Term Noteholders have in the Collateral, except as otherwise expressly set forth in this Agreement. The Term Agent, on behalf of itself and the Term Noteholders, agrees that neither the ABL Agent nor any ABL Lender shall incur any liability as a result of a sale, lease, license, application, or other disposition of all or any portion of the Collateral or Proceeds thereof, pursuant to the ABL Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement. (c) None of the Term Agent, any Term Noteholder or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, 22 or realize upon any of the Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. If the Term Agent or any Term Noteholder honors (or fails to honor) a request by any Borrower for an extension of credit pursuant to the Term Indenture or any of the other Term Documents, whether the Term Agent or any Term Noteholder has knowledge that the honoring of (or failure to honor) any such request would constitute a default under the terms of any ABL Credit Agreement or any other ABL Document (but not a default under this Agreement) or an act, condition, or event that, with the giving of notice or the passage of time, or both, would constitute such a default, or if the Term Agent or any Term Noteholder otherwise should exercise any of its contractual rights or remedies under the Term Documents (subject to the express terms and conditions hereof), neither the Term Agent nor any Term Noteholder shall have any liability whatsoever to the ABL Agent or any ABL Lender as a result of such action, omission, or exercise (so long as any such exercise does not breach the express terms and provisions of this Agreement). The Term Agent and the Term Noteholders shall be entitled to manage and supervise their loans and extensions of credit under the Term Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the ABL Agent or any ABL Lender has in the Collateral, except as otherwise expressly set forth in this Agreement. The ABL Agent, on behalf of itself and the ABL Lenders, agrees that none of the Term Agent or the Term Noteholders shall incur any liability as a result of a sale, lease, license, application, or other disposition of the Collateral or any part or Proceeds thereof, pursuant to the Term Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement. SECTION 5.2 MODIFICATIONS TO ABL DOCUMENTS AND TERM DOCUMENTS. (a) The Term Agent, on behalf of itself and the Term Noteholders, hereby agrees that, without affecting the obligations of the Term Agent and the Term Noteholders hereunder, the ABL Agent and the ABL Lenders may, at any time and from time to time, in their sole discretion without the consent of or notice to the Term Agent or any Term Noteholder (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the Term Agent or any Term Noteholder or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the ABL Documents in any manner whatsoever, including, to: (i) change the manner, place, time, or terms of payment or renew or alter, all or any of the ABL Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the ABL Obligations or any of the ABL Documents; (ii) retain or obtain a Lien on any Property of any Person to secure any of the ABL Obligations, and in connection therewith to enter into any additional ABL Documents; 23 (iii) amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the ABL Obligations; (iv) release its Lien on any Collateral or other Property; (v) exercise or refrain from exercising any rights against any Borrower, any Guarantor, or any other Person; (vi) retain or obtain the primary or secondary obligation of any other Person with respect to any of the ABL Obligations; and (vii) otherwise manage and supervise the ABL Obligations as the ABL Agent shall deem appropriate. (b) The ABL Agent, on behalf of itself and the ABL Lenders, hereby agrees that, without affecting the obligations of the ABL Agent and the ABL Lenders hereunder, the Term Agent and the Term Noteholders may, at any time and from time to time, in their sole discretion without the consent of or notice to the ABL Agent or any ABL Lender (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the ABL Agent or any ABL Lender or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the Term Documents in any manner whatsoever, including, to: (i) change the manner, place, time, or terms of payment or renew or alter, all or any of the Term Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the Term Obligations or any of the Term Documents; (ii) retain or obtain a Lien on any Property of any Person to secure any of the Term Obligations, and in connection therewith to enter into any additional Term Documents; (iii) amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the Term Obligations; (iv) release its Lien on any Collateral or other Property; (v) exercise or refrain from exercising any rights against any Borrower, any Guarantor, or any other Person; (vi) retain or obtain the primary or secondary obligation of any other Person with respect to any of the Term Obligations; and (vii) otherwise manage and supervise the Term Obligations as the Term Agent shall deem appropriate. 24 Notwithstanding the foregoing, until the Discharge of the ABL Obligations has occurred, the Term Agent and the Term Noteholders shall not amend, modify or otherwise change (or permit the amendment, modification or other change in any manner of) the defined terms "Credit Facility Document," "Credit Facility Liens," "Credit Facility Priority Collateral," "Discharge of Credit Facility Obligations," and "Discharge of Senior Secured Note Obligations," as such terms appear in the Term Documents as in effect on the date hereof, in a manner that would be adverse to the ABL Agent or the ABL Lenders without the prior written consent of the ABL Agent. SECTION 5.3 REINSTATEMENT AND CONTINUATION OF AGREEMENT. (a) If the ABL Agent or any ABL Lender is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of any Borrower, any Guarantor, or any other Person any amount (a "RECOVERY"), then the ABL Obligations shall be reinstated to the extent of such Recovery. If this Agreement shall have been terminated prior to such Recovery, this Agreement shall be reinstated in full force and effect, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Term Agent, the ABL Lenders, and the Term Noteholders under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against any Borrower or any Guarantor or any other circumstance which otherwise might constitute a defense available to, or a discharge of any Borrower or any Guarantor in respect of the ABL Obligations or the Term Obligations. No priority or right of the ABL Agent or any ABL Lender shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of any Borrower or any Guarantor or by the noncompliance by any Person with the terms, provisions, or covenants of any of the ABL Documents, regardless of any knowledge thereof which the ABL Agent or any ABL Lender may have. (b) If the Term Agent or any Term Noteholder is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of any Borrower, any Guarantor, or any other Person a Recovery, then the Term Obligations shall be reinstated to the extent of such Recovery. If this Agreement shall have been terminated prior to such Recovery, this Agreement shall be reinstated in full force and effect, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Term Agent, the ABL Lenders, and the Term Noteholders under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against any Borrower or any Guarantor or any other circumstance which otherwise might constitute a defense available to, or a discharge of any Borrower or any Guarantor in respect of the ABL Obligations or the Term Obligations. No priority or right of the Term Agent or any Term Noteholder shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of any Borrower or any Guarantor or by the noncompliance by any Person with the terms, provisions, or covenants of the Term Indenture or any of the other Term Documents, regardless of any knowledge thereof which the Term Agent or any Term Noteholder may have. 25 ARTICLE 6 INSOLVENCY PROCEEDINGS SECTION 6.1 DIP FINANCING. (a) If any Borrower or any Guarantor shall be subject to any Insolvency Proceeding in the United States at any time prior to the Discharge of ABL Obligations, and the ABL Agent or the ABL Lenders shall seek to provide any Borrower or any Guarantor with, or consent to a third party providing, any financing under Section 364 of the Bankruptcy Code or consent to any order for the use of cash collateral under Section 363 of the Bankruptcy Code ("DIP FINANCING"), with such DIP Financing to be secured by all or any portion of the Collateral (including assets that, but for the application of Section 552 of the Bankruptcy Code would be Collateral), then the Term Agent, on behalf of itself and the Term Noteholders, agrees that it will raise no objection and will not support any objection to such DIP Financing on the grounds of a failure to provide "adequate protection" for the Liens of the Term Agent securing the Term Obligations or on any other grounds (and will not request any adequate protection solely as a result of such DIP Financing), so long as (i) the Term Agent retains its Lien on the Collateral to secure the Term Obligations (in each case, including Proceeds thereof arising after the commencement of the case under the Bankruptcy Code) and, as to the Term Priority Collateral only, such Lien has the same priority as existed prior to the commencement of the case under the Bankruptcy Code and any Lien securing such DIP Financing is junior and subordinate to the Lien of the Term Agent on the Term Priority Collateral, (ii) all Liens on ABL Priority Collateral securing any such DIP Financing shall be senior to or on a parity with the Liens of the ABL Agent and the ABL Lenders securing the ABL Obligations on ABL Priority Collateral and (iii) if the ABL Agent receives an adequate protection Lien on post-petition assets of the debtor to secure the ABL Obligations, the Term Agent also receives an adequate protection Lien on such post-petition assets of the debtor to secure the Term Obligations, provided that such Liens in favor of the ABL Agent and the Term Agent shall be subject to the provisions of Section 6.1(b) hereof (b) All Liens granted to the ABL Agent or the Term Agent in any Insolvency Proceeding, whether as adequate protection or otherwise, are intended by the Parties to be and shall be deemed to be subject to the Lien Priority and the other terms and conditions of this Agreement. SECTION 6.2 RELIEF FROM STAY. Until the Discharge of ABL Obligations has occurred, the Term Agent, on behalf of itself and the Term Noteholders, agrees not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the ABL Priority Collateral without the ABL Agent's express written consent. Until the Discharge of Term Obligations has occurred, the ABL Agent, on behalf of itself and the ABL Lenders, agrees not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the Term Priority Collateral without the Term Agent's express written consent. In addition, neither the Term Agent nor the ABL Agent shall seek any relief from the automatic stay with respect to any Collateral without providing 30 days' prior written notice to the other, unless such period is agreed by both the ABL Agent and the Term Agent to be modified. 26 SECTION 6.3 NO CONTEST. The Term Agent, on behalf of itself and the Term Noteholders, agrees that, prior to the Discharge of ABL Obligations, none of them shall contest (or support any other Person contesting) (a) any request by the ABL Agent or any ABL Lender for adequate protection of its interest in the Collateral, or (b) any objection by the ABL Agent or any ABL Lender to any motion, relief, action, or proceeding based on a claim by the ABL Agent or any ABL Lender that its interests in the Collateral are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to the ABL Agent as adequate protection of its interests are subject to this Agreement. The ABL Agent, on behalf of itself and the ABL Lenders, agrees that, prior to the Discharge of Term Obligations, none of them shall contest (or support any other Person contesting) (i) any request by the Term Agent or any Term Noteholder for adequate protection of its interest in the Collateral (unless in contravention of Section 6.1(a) above), or (ii) any objection by the Term Agent or any Term Noteholder to any motion, relief, action or proceeding based on a claim by the Term Agent or any Term Noteholder that its interests in the Collateral (unless in contravention of Section 6.1(a) above) are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to the Term Agent as adequate protection of its interests are subject to this Agreement. SECTION 6.4 ASSET SALES. The Term Agent agrees, on behalf of itself and the Term Noteholders, that it will not oppose any sale consented to by the ABL Agent of any ABL Priority Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement. The ABL Agent agrees, on behalf of itself and the ABL Lenders, that it will not oppose any sale consented to by the Term Agent of any Term Priority Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement. If such sale of Collateral includes both ABL Priority Collateral and Term Priority Collateral and the Parties are unable to agree on the allocation of the purchase price between the ABL Priority Collateral and Term Priority Collateral, either Party may apply to the court in such Insolvency Proceeding to make a determination of such allocation, and the court's determination shall be binding upon the Parties. SECTION 6.5 SEPARATE GRANTS OF SECURITY AND SEPARATE CLASSIFICATION. Each Term Noteholder, the Term Agent, each ABL Lender and the ABL Agent acknowledges and agrees that (i) the grants of Liens pursuant to the ABL Security Documents and the Term Security Documents constitute two separate and distinct grants of Liens and (ii) because of, among other things, their differing rights in the Collateral, the Term Obligations are fundamentally different from the ABL Obligations and must be separately classified in any plan of reorganization proposed or adopted in an Insolvency Proceeding. To further effectuate the intent of the parties as provided in the immediately preceding sentence, if it is held that the claims of the ABL Secured Parties and the Term Secured Parties in respect of the Collateral constitute only one secured claim (rather than separate classes of senior and junior secured claims), then the ABL Secured Parties and the Term Secured Parties hereby acknowledge and agree that all distributions shall be made as if there were separate classes of ABL Obligation claims and Term Obligation claims against the Credit Parties (with the effect being that, to the extent that the aggregate value of the ABL Priority Collateral or Term Priority Collateral is sufficient (for this purpose ignoring all claims held by the other Secured Parties), the ABL Secured Parties or the 27 Term Secured Parties, respectively, shall be entitled to receive, in addition to amounts distributed to them in respect of principal, pre-petition interest and other claims, all amounts owing in respect of post-petition interest that is available from each pool of Priority Collateral for each of the ABL Secured Parties and the Term Secured Parties, respectively, before any distribution is made in respect of the claims held by the other Secured Parties, with the other Secured Parties hereby acknowledging and agreeing to turn over to the respective other Secured Parties amounts otherwise received or receivable by them to the extent necessary to effectuate the intent of this sentence, even if such turnover has the effect of reducing the aggregate recoveries. SECTION 6.6 ENFORCEABILITY. The provisions of this Agreement are intended to be and shall be enforceable under Section 510(a) of the Bankruptcy Code. SECTION 6.7 ABL OBLIGATIONS UNCONDITIONAL. All rights of the ABL Agent hereunder, and all agreements and obligations of the Term Agent and the Credit Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of: (i) any lack of validity or enforceability of any ABL Document; (ii) any change in the time, place or manner of payment of, or in any other term of, all or any portion of the ABL Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any ABL Document; (iii) any exchange, release, voiding, avoidance or non perfection of any security interest in any Collateral or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of all or any portion of the ABL Obligations or any guarantee or guaranty thereof; or (iv) any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Credit Party in respect of the ABL Obligations, or of any of the Term Agent, or any Credit Party, to the extent applicable, in respect of this Agreement. SECTION 6.8 TERM OBLIGATIONS UNCONDITIONAL. All agreements and obligations of the ABL Agent and the Credit Parties, to the extent applicable, hereunder, shall remain in full force and effect irrespective of: (i) any lack of validity or enforceability of any Term Document; (ii) any change in the time, place or manner of payment of, or in any other term of, all or any portion of the Term Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any Term Document; (iii) any exchange, release, voiding, avoidance or non perfection of any security interest in any Collateral, or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any 28 refinancing, replacement, refunding or restatement of all or any portion of the Term Obligations or any guarantee or guaranty thereof; or (iv) any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Credit Party in respect of the Term Obligations, or of any of the ABL Agent or any Credit Party, to the extent applicable, in respect of this Agreement. ARTICLE 7 MISCELLANEOUS SECTION 7.1 RIGHTS OF SUBROGATION. The Term Agent, for and on behalf of itself and the Term Noteholders, agrees that no payment to the ABL Agent or any ABL Lender pursuant to the provisions of this Agreement shall entitle the Term Agent or any Term Noteholder to exercise any rights of subrogation in respect thereof until the Discharge of ABL Obligations shall have occurred. Following the Discharge of ABL Obligations, the ABL Agent agrees to execute such documents, agreements, and instruments as the Term Agent or any Term Noteholder may reasonably request to evidence the transfer by subrogation to any such Person of an interest in the ABL Obligations resulting from payments to the ABL Agent by such Person, so long as all costs and expenses (including all reasonable legal fees and disbursements) incurred in connection therewith by the ABL Agent are paid by such Person upon request for payment thereof. The ABL Agent, for and on behalf of itself and the ABL Lenders, agrees that no payment to the Term Agent or any Term Noteholder pursuant to the provisions of this Agreement shall entitle the ABL Agent or any ABL Lender to exercise any rights of subrogation in respect thereof until the Discharge of Term Obligations shall have occurred. Following the Discharge of Term Obligations, the Term Agent agrees to execute such documents, agreements, and instruments as the ABL Agent or any ABL Lender may reasonably request to evidence the transfer by subrogation to any such Person of an interest in the Term Obligations resulting from payments to the Term Agent by such Person, so long as all costs and expenses (including all reasonable legal fees and disbursements) incurred in connection therewith by the Term Agent are paid by such Person upon request for payment thereof. SECTION 7.2 FURTHER ASSURANCES. The Parties will, at their own expense and at any time and from time to time, promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that either Party may reasonably request, in order to protect any right or interest granted or purported to be granted hereby or to enable the ABL Agent or the Term Agent to exercise and enforce its rights and remedies hereunder; provided, however, that no Party shall be required to pay over any payment or distribution, execute any instruments or documents, or take any other action referred to in this Section 7.2, to the extent that such action would contravene any law, order or other legal requirement or any of the terms or provisions of this Agreement, and in the event of a controversy or dispute, such Party may interplead any payment or distribution in any court of competent jurisdiction, without further responsibility in respect of such payment or distribution under this Section 7.2. SECTION 7.3 REPRESENTATIONS. The Term Agent represents and warrants to the ABL Agent that it has the requisite power and authority under the Term Documents to enter 29 into, execute, deliver, and carry out the terms of this Agreement on behalf of itself and the Term Noteholders. The ABL Agent represents and warrants to the Term Agent that it has the requisite power and authority under the ABL Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of itself and the ABL Lenders. SECTION 7.4 AMENDMENTS. No amendment or waiver of any provision of this Agreement nor consent to any departure by any Party hereto shall be effective unless it is in a written agreement executed by the Term Agent and the ABL Agent, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. SECTION 7.5 ADDRESSES FOR NOTICES. Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, telecopied, or sent by overnight express courier service or United States mail and shall be deemed to have been given when delivered in person or by courier service, upon receipt of a telecopy or five (5) days after deposit in the United States mail (certified, with postage prepaid and properly addressed). For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this Section) shall be as set forth below or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties. Term Agent: U.S. Bank National Association 425 Walnut Street Cincinnati, Ohio 45202 Fax: (513) 632-5511 Attention: Corporate Trust Office ABL Agent: JPMorgan Chase Bank c/o J.P. Morgan Business Credit Corp. One Chase Square, CS-5 Rochester, New York 14643 Fax: (585) 258-7440 Attention: Milacron Relationship Manager SECTION 7.6 NO WAIVER, REMEDIES. No failure on the part of any Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. SECTION 7.7 CONTINUING AGREEMENT, TRANSFER OF SECURED OBLIGATIONS. This Agreement is a continuing agreement and shall (a) remain in full force and effect until the 30 Discharge of ABL Obligations and the Discharge of Term Obligations shall have occurred, (b) be binding upon the Parties and their successors and assigns, and (c) inure to the benefit of and be enforceable by the Parties and their respective successors, transferees and assigns. Nothing herein is intended, or shall be construed to give, any other Person any right, remedy or claim under, to or in respect of this Agreement or any Collateral. All references to any Credit Party shall include any Credit Party as debtor-in-possession and any receiver or trustee for such Credit Party in any Insolvency Proceeding. Without limiting the generality of the foregoing clause (c), the ABL Agent, any ABL Lender, the Term Agent, or any Term Noteholder may assign or otherwise transfer all or any portion of the ABL Obligations or the Term Obligations, as applicable, to any other Person (other than any Borrower, any Guarantor or any Affiliate of any Borrower or any Guarantor and any Subsidiary of any Borrower or any Guarantor), and such other Person shall thereupon become vested with all the rights and obligations in respect thereof granted to the ABL Agent, the Term Agent, any ABL Lender, or any Term Noteholder, as the case may be, herein or otherwise. The ABL Secured Parties and the Term Secured Parties may continue, at any time and without notice to the other parties hereto, to extend credit and other financial accommodations, lend monies and provide indebtedness to, or for the benefit of, any Credit Party on the faith hereof. SECTION 7.8 GOVERNING LAW: ENTIRE AGREEMENT. The validity, performance, and enforcement of this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. This Agreement constitutes the entire agreement and understanding among the Parties with respect to the subject matter hereof and supersedes any prior agreements, written or oral, with respect thereto. SECTION 7.9 COUNTERPARTS. This Agreement may be executed in any number of counterparts, and it is not necessary that the signatures of all Parties be contained on any one counterpart hereof, each counterpart will be deemed to be an original, and all together shall constitute one and the same document. SECTION 7.10 NO THIRD PARTY BENEFICIARIES. This Agreement is solely for the benefit of the ABL Agent, ABL Lenders, Term Agent and Term Noteholders. No other Person (including any Borrower, any Guarantor or any Affiliate of any Borrower or any Guarantor, or any Subsidiary of any Borrower or any Guarantor) shall be deemed to be a third party beneficiary of this Agreement. SECTION 7.11 HEADINGS. The headings of the articles and sections of this Agreement are inserted for purposes of convenience only and shall not be construed to affect the meaning or construction of any of the provisions hereof. SECTION 7.12 SEVERABILITY. If any of the provisions in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement and shall not invalidate the Lien Priority or the application of Proceeds and other priorities set forth in this Agreement. SECTION 7.13 ATTORNEYS FEES. The Parties agree that if any dispute, arbitration, litigation, or other proceeding is brought with respect to the enforcement of this Agreement or any provision hereof, the prevailing party in such dispute, arbitration, litigation, or other 31 proceeding shall be entitled to recover its reasonable attorneys' fees and all other costs and expenses incurred in the enforcement of this Agreement, irrespective of whether suit is brought. SECTION 7.14 VENUE; JURY TRIAL WAIVER. (a) EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY ABL SECURED PARTY OR ANY TERM SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY ABL DOCUMENTS AGAINST ANY CREDIT PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. (b) EACH PARTY HERETO HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY HERETO REPRESENTS THAT IT HAS REVIEWED THIS WAIVER AND IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. (c) EACH PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.5. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. SECTION 7.15 INTERCREDITOR AGREEMENT. This Agreement is the Intercreditor Agreement referred to in the Original ABL Credit Agreement and the Term Indenture. Nothing in this Agreement shall be deemed to subordinate the right of any ABL Secured Party to receive payment to the right of any Term Secured Party to receive payment or of any Term Secured Party to receive payment to the right of any ABL Secured Party to receive payment (whether 32 before or after the occurrence of an Insolvency Proceeding), it being the intent of the Parties that this Agreement shall effectuate a subordination of Liens but not a subordination of Indebtedness. SECTION 7.16 NO WARRANTIES OR LIABILITY. The Term Agent and the ABL Agent acknowledge and agree that neither has made any representation or warranty with respect to the execution, validity, legality, completeness, collectibility or enforceability of any other ABL Document or any Term Document. Except as otherwise provided in this Agreement, the Term Agent and the ABL Agent will be entitled to manage and supervise their respective extensions of credit to any Credit Party in accordance with law and their usual practices, modified from time to time as they deem appropriate. SECTION 7.17 CONFLICTS. In the event of any conflict between the provisions of this Agreement and the provisions of any ABL Document or any Term Document, the provisions of this Agreement shall govern. SECTION 7.18 INFORMATION CONCERNING FINANCIAL CONDITION OF THE CREDIT PARTIES. Each of the Term Agent and the ABL Agent hereby assume responsibility for keeping itself informed of the financial condition of the Credit Parties and all other circumstances bearing upon the risk of nonpayment of the ABL Obligations or the Term Obligations. The Term Agent and the ABL Agent hereby agree that no party shall have any duty to advise any other party of information known to it regarding such condition or any such circumstances. In the event the Term Agent or the ABL Agent, in its sole discretion, undertakes at any time or from time to time to provide any information to any other party to this Agreement, it shall be under no obligation (A) to provide any such information to such other party or any other party on any subsequent occasion, (B) to undertake any investigation not a part of its regular business routine, or (C) to disclose any other information. [Signature pages follow.] 33 IN WITNESS WHEREOF, the ABL Agent, for and on behalf of itself and the ABL Lenders, and the Term Agent, for and on behalf of itself and the Term Noteholders, have caused this Agreement to be duly executed and delivered as of the date first above written. JPMORGAN CHASE BANK, as the ABL Agent By: /s/ James M. Barbato ------------------------- Name: James M. Barbato Title: Vice President U.S. BANK NATIONAL ASSOCIATION, as the Term Agent By: /s/ Karolina K. Dies ------------------------- Name: Karolina K. Dies Title: Signature Page to Intercreditor Agreement ACKNOWLEDGMENT Each Borrower and each Guarantor hereby acknowledges that it has received a copy of this Agreement and consents thereto, agrees to recognize all rights granted thereby to the ABL Agent, the ABL Lenders, the Term Agent, and the Term Noteholders and will not do any act or perform any obligation which is not in accordance with the agreements set forth in this Agreement. Each Borrower and each Guarantor further acknowledges and agrees that it is not an intended beneficiary or third party beneficiary under this Agreement. BORROWERS: MILACRON INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Vice-President - Finance and Chief Financial Officer Signature Page to Intercreditor Agreement CIMCOOL INDUSTRIAL PRODUCTS INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement D-M-E MANUFACTURING INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement D-M-E U.S.A. INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement MILACRON INDUSTRIAL PRODUCTS, INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement MILACRON MARKETING COMPANY By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement MILACRON PLASTICS TECHNOLOGIES GROUP INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement NICKERSON MACHINERY CHICAGO INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement NORTHERN SUPPLY COMPANY, INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement OAK INTERNATIONAL, INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement PLIERS INTERNATIONAL INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement UNILOY MILACRON INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement UNILOY MILACRON U.S.A. INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement GUARANTORS: D-M-E COMPANY By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Vice President Signature Page to Intercreditor Agreement MILACRON CAPITAL HOLDINGS B.V. By: /s/ G. van Deventer ----------------------- Name: G. van Deventer Title: Managing Director Signature Page to Intercreditor Agreement MILACRON INTERNATIONAL MARKETING COMPANY By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Treasurer and Assistant Secretary Signature Page to Intercreditor Agreement MILACRON RESIN ABRASIVES INC. By: /s/ R. P. Lienesch ---------------------- Name: R. P. Lienesch Title: Vice President Signature Page to Intercreditor Agreement D-M-E OF CANADA LIMITED By: /s/ John C. Francy ---------------------- Name: John C. Francy Title: Treasurer Signature Page to Intercreditor Agreement PROGRESS PRECISION INC. By: /s/ R. P. Lienesch --------------------- Name: R. P. Lienesch Title: Treasurer Signature Page to Intercreditor Agreement 450500 ONTARIO LIMITED By: /s/ Hugh C. O'Donnell ------------------------ Name: Hugh C. O'Donnell Title: Secretary Signature Page to Intercreditor Agreement 528650 ONTARIO LIMITED By: /s/ John C. Francy --------------------- Name: John C. Francy Title: Assistant Treasurer Signature Page to Intercreditor Agreement 2913607 CANADA LIMITED By: /s/ John C. Francy ---------------------- Name: John C. Francy Title: Assistant Treasurer Signature Page to Intercreditor Agreement MILACRON CANADA INC. By: /s/ Hugh C. O'Donnell ------------------------- Name: Hugh C. O'Donnell Title: Secretary Signature Page to Intercreditor Agreement Schedule A ABL Priority Collateral Accounts Schedule B ABL Guarantors and Term Guarantors ABL Guarantors: D-M-E COMPANY MILACRON CAPITAL HOLDINGS B.V. MILACRON INTERNATIONAL MARKETING COMPANY MILACRON RESIN ABRASIVES INC. MILACRON CANADA INC. 2913607 ONTARIO LIMITED 450500 CANADA LIMITED 528650 ONTARIO LIMITED D-M-E OF CANADA LIMITED PROGRESS PRECISION INC. Term Guarantors: CIMCOOL INDUSTRIAL PRODUCTS INC. D-M-E MANUFACTURING INC. D-M-E U.S.A. INC. MILACRON INDUSTRIAL PRODUCTS, INC. MILACRON MARKETING COMPANY MILACRON PLASTICS TECHNOLOGIES GROUP INC. NICKERSON MACHINERY CHICAGO, INC. NORTHERN SUPPLY COMPANY, INC. OAK INTERNATIONAL, INC. PLIERS INTERNATIONAL INC. UNILOY MILACRON INC. UNILOY MILACRON U.S.A. INC. D-M-E COMPANY MILACRON CAPITAL HOLDINGS B.V. MILACRON INTERNATIONAL MARKETING COMPANY MILACRON RESIN ABRASIVES INC. MILACRON CANADA INC. 2913607 ONTARIO LIMITED 450500 CANADA LIMITED 528650 ONTARIO LIMITED D-M-E OF CANADA LIMITED PROGRESS PRECISION INC. EX-4.10 53 y98028exv4w10.txt MORTGAGE, ASSIGNMENT OF LEASES AND RENTS EXHIBIT 4.10 MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING MADE BY D-M-E COMPANY (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 1975 N. 17th Avenue Melrose Park, Illinois 60160 Property Index: 12-34-403-020 12-34-403-024 DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Jonathan P. Baumstark, Esq. Latham & Watkins LLP 885 Third Avenue New York, New York 10022 Attn: Jonathan P. Baumstark, Esq. TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS.................................................................. 2 SECTION 1.01 Terms Defined Above........................................... 2 SECTION 1.02 Definitions................................................... 2 SECTION 1.03 Terminology................................................... 6 SECTION 1.04 Other Defined Terms........................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST......................................... 6 SECTION 2.01 Grant of Lien................................................. 6 SECTION 2.02 Grant of Security Interest.................................... 7 SECTION 2.03 No Obligation of Mortgagee.................................... 7 SECTION 2.04 Fixture Filing................................................ 7 SECTION 2.05 Future Advances............................................... 8 ARTICLE III ASSIGNMENT OF LEASES AND RENTS............................................. 8 SECTION 3.01 Assignment.................................................... 8 SECTION 3.02 Revocable License............................................. 8 SECTION 3.03 Enforcement of Leases......................................... 9 SECTION 3.04 Direction to Tenants.......................................... 9 SECTION 3.05 Appointment of Attorney-in-Fact............................... 9 SECTION 3.06 No Liability of Mortgage...................................... 10 SECTION 3.07 Mortgagor's Indemnities....................................... 11 SECTION 3.08 No Modification of Mortgagor's Obligations.................... 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES.............................................. 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage......... 11 SECTION 4.02 Taxes and Other Payments...................................... 12 SECTION 4.03 Power to Create Lien and Security............................. 12 SECTION 4.04 Senior Secured Note Documents and Indenture................... 12 SECTION 4.05 Compliance with Laws.......................................... 12 SECTION 4.06 No Condemnation............................................... 13 SECTION 4.07 Flood Zone.................................................... 13 ARTICLE V AFFIRMATIVE COVENANTS........................................................ 13 SECTION 5.01 Lien.......................................................... 13 SECTION 5.02 Payment of Impositions........................................ 13 SECTION 5.03 Repair........................................................ 14 SECTION 5.04 Insurance and Application of Insurance Proceeds............... 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds......... 17 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights........................................................ 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations.... 18 SECTION 5.08 Compliance with Permitted Liens and Other Obligations......... 18
i SECTION 5.09 Additional Affirmative Covenants.............................. 18 ARTICLE VI NEGATIVE COVENANTS.......................................................... 18 SECTION 6.01 Use Violations................................................ 18 SECTION 6.02 Waste......................................................... 18 SECTION 6.03 Alterations................................................... 19 SECTION 6.04 No Further Encumbrances....................................... 19 SECTION 6.05 Transfer Restrictions......................................... 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............................................ 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES............................................. 19 SECTION 7.01 Event of Default.............................................. 19 SECTION 7.02 Acceleration.................................................. 19 SECTION 7.03 Foreclosure and Sale.......................................... 20 SECTION 7.04 Mortgagee's Agents............................................ 21 SECTION 7.05 Judicial Foreclosure.......................................... 21 SECTION 7.06 Receiver...................................................... 21 SECTION 7.07 Foreclosure for Installments.................................. 21 SECTION 7.08 Separate Sales................................................ 22 SECTION 7.09 Possession of Mortgaged Property.............................. 22 SECTION 7.10 Occupancy After Acceleration.................................. 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive.............. 23 SECTION 7.12 No Release of Senior Secured Note Obligations................. 23 SECTION 7.13 Release of and Resort to Collateral........................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets........ 24 SECTION 7.15 Discontinuance of Proceedings................................. 24 SECTION 7.16 Application of Proceeds....................................... 24 SECTION 7.17 Uniform Commercial Code Remedies.............................. 25 SECTION 7.18 Indemnity..................................................... 25 ARTICLE VIII MISCELLANEOUS............................................................. 26 SECTION 8.01 Instrument Construed as Mortgage, Etc......................... 26 SECTION 8.02 Performance at Mortgagor's Expense............................ 26 SECTION 8.03 Survival of Senior Secured Note Obligations................... 26 SECTION 8.04 Further Assurances............................................ 26 SECTION 8.05 Notices....................................................... 26 SECTION 8.06 No Waiver..................................................... 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures...... 27 SECTION 8.08 Successors and Assigns........................................ 27 SECTION 8.09 Severability.................................................. 27 SECTION 8.10 Entire Agreement and Modification............................. 28 SECTION 8.11 Applicable Law................................................ 28 SECTION 8.12 Satisfaction of Prior Encumbrance............................. 28 SECTION 8.13 No Partnership................................................ 28 SECTION 8.14 Headings...................................................... 29

ii SECTION 8.15 Release of Mortgage........................................... 29 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property............................................ 29 SECTION 8.17 Inconsistency with Indenture.................................. 29 SECTION 8.18 Limitation on Interest Payable................................ 30 SECTION 8.19 Covenants To Run With the Land................................ 30 SECTION 8.20 Amount Secured; Last Dollar................................... 30 SECTION 8.21 Defense of Claims............................................. 30 SECTION 8.22 Exculpation Provisions........................................ 31 SECTION 8.23 No Merger of Estates.......................................... 31 SECTION 8.24 Release Upon Transfer or Sale................................. 31 SECTION 8.25 Counterparts.................................................. 32 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS........................................ 32 SECTION 9.01 Insurance..................................................... 32 SECTION 9.02 Future Advances............................................... 32 SECTION 9.03 Business Senior Secured Note Recital.......................... 33 SECTION 9.04 Waiver of Statutory Rights.................................... 33 SECTION 9.05 Protective Advances........................................... 33 SECTION 9.06 Receiver...................................................... 34 SECTION 9.07 Available Defenses............................................ 34 ARTICLE X INTERCREDITOR................................................................ 35

EXHIBIT A - LEGAL DESCRIPTION iii MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E COMPANY, a Delaware corporation, with an address at 29111 Stephenson Highway, Madison Heights, Michigan, 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, on the date hereof, Mortgagor, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and Parent, each an "Obligor" and collectively, the "Obligors") and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (a) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect 3 to all minerals, coal, oil, gas and other substances of any kind or character on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (b) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (c) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (d) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (e) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (f) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (g) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (h) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (i) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter 4 given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); (j) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (k) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (l) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. 5 "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay 6 (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC covering all fixtures; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E Company Type of Organization: Corporation State of Incorporation: Delaware FEIN: 31-1453086 Organizational ID Number: 2580409 Name of Secured Party: U.S. Bank National Association 7 Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. It is the intention of Mortgagor and Mortgagee that this Mortgage (as renewed and extended from time to time) shall secure future advances and readavances, and the lien and security interest created by this Mortgage shall attach upon execution and have priority from the time of recording as to all advances, whether obligatory or discretionary, until this Mortgage is released of record. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. 8 (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. 9 (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgage. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating 10 to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or such Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all 11 Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, 12 permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien 13 against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. 14 (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. 15 (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. 16 SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or 17 operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture.. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. 18 SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Senior Secured Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. 19 SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such 20 circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without 21 exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that 22 the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; 24 (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. 25 ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any 26 provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of ) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the 27 extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. 28 SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be 29 deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Amount Secured; Last Dollar. So long as the balance of the Obligations exceeds the portion of the Obligations secured by this Mortgage, no payment on account of the Obligations shall be deemed to be applied against or to reduce the portion of the Obligations secured by this Mortgage, but shall, instead, be deemed to be applied against only such portions of the Obligations that are not secured by this Mortgage. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, 30 defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release Upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of 31 any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Insurance. In addition to other remedies available under this Mortgage, if at any time Mortgagor fails to provide Mortgagee with evidence of the insurance coverage required to be carried by the Mortgagor under this Mortgage, Mortgagee may purchase such insurance at the Mortgagor's expense to protect Mortgagee's interest in the Mortgaged Property. This insurance purchased by Mortgagee may, but need not, protect the interest of the Mortgagor's interests. The coverage purchased by Mortgagee may or may not pay any claim that the Mortgagor makes or any claim that is made against the Mortgagor in connection with the Mortgaged Property. The Mortgagor may later cancel any insurance purchased by Mortgagee, but only after providing Mortgagee with evidence that the Mortgagor has obtained insurance as required by this Mortgage. If Mortgagee purchases insurance for the Mortgaged Property, the Mortgagor will be responsible for the costs of that insurance, including, interest and other charges that Mortgagee imposes in connection with the placement of the insurance, until the effective date of the cancellation or expiration of the insurance. The costs of insurance purchased by Mortgagee may be added to the total outstanding balance of the Senior Secured Note Obligations with interest at the default rate specified in the Indenture. The costs of the insurance purchased by Mortgagee may be more than the cost of insurance that the Mortgagor be able to obtain through Mortgagor's own efforts. SECTION 9.02 Future Advances. The lien of this Mortgage shall secure the payment of all loans and advances made pursuant to the terms of this Mortgage and the Indenture, whether such loans and future advances are obligatory or are to be made at the option of Mortgagee, and whether made now or in the future (but not future advances made more than twenty (20) years after the date hereof) to the same extent as if such future advances were made on the date of execution of this Mortgage. The lien of this Mortgage shall be valid as to all of the Senior Secured Note Obligations, including future advances, from the time of the filing of record of this Mortgage in the office of the Recorder of Deeds of the County in which the Premises are 32 located. The total amount of the Senior Secured Note Obligations may increase or decrease from time to time, but the total unpaid principal balance of the Senior Secured Note Obligations (including disbursements which Mortgagee may make under this Mortgage, or any other document or instrument evidencing or securing the Senior Secured Note Obligations), at any time outstanding, shall not exceed $280,000,000.00. This Mortgage shall be valid and shall have priority over all subsequent liens and encumbrances, including statutory liens, except taxes and assessments levied on the Mortgaged Property, to the extent of the maximum amount secured hereby. SECTION 9.03 Business Senior Secured Note Recital. The proceeds of the Senior Secured Note Obligations shall be used solely for business purposes and in furtherance of the regular business affairs of Mortgagor, and the entire principal obligation secured hereby constitutes: (a) a "business loan" as that term is defined in, and for all purposes of, 815 ILCS 205/4 (1) (c); and, (b) a "loan secured by a mortgage on real estate" within the purview and operation of 815 ILCS 204/4 (1) (1). SECTION 9.04 Waiver of Statutory Rights. The Mortgagor agrees, to the full extent permitted by law, that in the event of a default, neither the Mortgagor nor anyone claiming through or under them will set up, claim, or seek to take advantage of any appraisement, valuation, stay, or extension laws or any so-called "Moratorium Laws," now or hereafter in force, in order to prevent or hinder the enforcement or foreclosure of this Mortgage, or the absolute sale of the Mortgaged Property, or the final and absolute putting into possession of the Mortgaged Property, immediately after such sale, of the purchaser thereat, and the Mortgagor, for itself and all who may at any time claim through or under it, hereby waives, to the full extent that it may lawfully so do, the benefit of all such laws, and any and all right to have the assets comprising the Mortgaged Property marshalled upon any foreclosure of the lien of this Mortgage and agree that Mortgagee, or any court having jurisdiction to foreclose the lien, may sell the Mortgaged Property in part or as an entirety. To the full extent permitted by law, the Mortgagor waives any and all rights of reinstatement and redemption from sale under any order or decree of foreclosure of this Mortgage, on its own behalf, and on behalf of each and every person, acquiring any interest in or title to the Mortgaged Property subsequent to the date of this Mortgage. The Mortgagor agrees, to the extent permitted by law, that no recovery of any judgment by Mortgagee, and no attachment or levy of execution upon any of the Mortgaged Property or any other property of the Mortgagor, will in any way affect the lien of this Mortgage upon the Mortgaged Property, or any part of the Mortgaged Property, or any lien, rights, powers, or remedies of Mortgagee under this Mortgage, but the lien, rights, powers, and remedies will continue unimpaired as before, until the Senior Secured Note Obligations are paid in full. SECTION 9.05 Protective Advances. In any suit to foreclose the lien of this Mortgage, there will be allowed and included as additional indebtedness in the decree for sale all expenditures and expenses which may be paid or incurred by or on behalf of Mortgagee for attorneys' fees, appraiser's fees, taxes, assessments, and insurance premiums paid by Mortgagee, outlays for documentary and expert evidence, stenographers' charges, publication costs, and costs (which may be estimated as to items to be expended after entry of the decree) of procuring all abstracts of title, title searches, title examinations, environmental reports, title insurance policies, and similar data and assurances with respect to title as Mortgagee may deem to be 33 reasonably necessary either to prosecute the suit or to evidence to bidders at any sale which may be had pursuant to the decree the true condition of the title to or the value of the Mortgaged Property. All such expenditures and expenses set forth in this section will become additional indebtedness secured by this Mortgage and immediately due and payable, with interest charged at the default rate specified in the Indenture, when paid or incurred by Mortgagee in connection with (i) any proceeding, including probate and bankruptcy proceedings, to which Mortgagee will be a party, either as plaintiff, claimant, or defendant, by reason of this Mortgage or any of the Obligations; or (ii) preparations for the commencement of any suit for the foreclosure of this Mortgage after accrual of such right to foreclose whether or not actually commenced; or (iii) preparations for the defense of any actual or threatened suit or proceeding which might affect the Mortgaged Property or the security of this Mortgage. SECTION 9.06 Receiver. Upon, or any time after, the filing of a complaint to foreclose this Mortgage the court in which the complaint is filed may appoint a receiver of the Mortgaged Property. Such appointment may be made either before or after the sale, without notice, without regard to the solvency or insolvency of the Mortgagor at the time of application for the receiver and without regard to the then value of the Mortgaged Property or whether the Mortgaged Property will be occupied as a homestead or not, and Mortgagee may be appointed as the receiver. Such receiver will have power to collect the rents, issues, and profits of the Mortgaged Property during the pendency of the foreclosure suit and, in case of a sale and a deficiency, during the full statutory period of redemption, whether there be redemption or not, as well as during any further times when the Mortgagor, except for the intervention of the receiver, would be entitled to collect the rents, issues, and profits, and all other powers which may be necessary or are usual in such cases for the protection, possession, control, management, and operation of the Mortgaged Property during the whole of the period. The court from time to time may authorize the receiver to apply the net income in payment in whole or in part of: (i) the indebtedness secured by this Mortgage, or by any decree foreclosing this Mortgage, or any tax, special assessment, or other lien which may be or become superior to the lien of this Mortgage or of such decree, provided such application is made prior to foreclosure sale; and (ii) the deficiency in case of a sale and deficiency. SECTION 9.07 Available Defenses. No action for the enforcement of the lien or of any provision of this Mortgage will be subject to any defense which would not be good and available to the party interposing the same in an action at law upon the Senior Secured Note Obligations secured by this Mortgage. The provisions contained in this Article IX ("Additional State Specific Provisions") are to be construed as conferring additional rights and remedies upon the Mortgagee and are not to be construed as limiting any rights or remedies of the Mortgagee which are contained elsewhere in this Mortgage. In the event of a conflict between the other terms of this Mortgage and the State Specific Provisions contained in this Article IX, the Mortgagee shall be entitled to the benefit of the provisions which provide it with the greatest rights and remedies, subject, however, to the applicable provisions of Illinois law including, without limitation, the Illinois Mortgage Foreclosure Law, 735 ILCS 5/15-1101 et seq., and any successor statute thereto. 34 ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June ___, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 35 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E COMPANY, a Delaware corporation By: /s/ R.P. Lienesch ----------------------- Name: R.P. Lienesch Title: Vice President STATE OF OHIO ) )SS. COUNTY OF HAMILTON ) On the 8th day of June in the year 2004 before me, the undersigned, a Notary Public in and for said State, personally appeared R.P. Lienesch, personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ Jean Moyer - -------------- Notary Public EXHIBIT A LEGAL DESCRIPTION Auditor's Parcel No. ________________________________________________ EX-4.11 54 y98028exv4w11.txt MORTGAGE Exhibit 4.11 MORTGAGE made by D-M-E U.S.A INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 6328 Ferry Avenue Charlevoix, Michigan 49720 Charlevoix County DATED AS OF JUNE 10, 2004 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS ............................................................................ 2 SECTION 1.01 Terms Defined Above......................................................... 2 SECTION 1.02 Definitions................................................................. 2 SECTION 1.03 Terminology................................................................. 6 SECTION 1.04 Other Defined Terms......................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST.................................................... 6 SECTION 2.01 Grant of Lien............................................................... 6 SECTION 2.02 Grant of Security Interest.................................................. 7 SECTION 2.03 No Obligation of Mortgagee.................................................. 7 SECTION 2.04 Fixture Filing.............................................................. 7 SECTION 2.05 Future Advances............................................................. 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS........................................................ 8 SECTION 3.01 Assignment.................................................................. 8 SECTION 3.02 Revocable License........................................................... 8 SECTION 3.03 Enforcement of Leases....................................................... 9 SECTION 3.04 Direction to Tenants........................................................ 9 SECTION 3.05 Appointment of Attorney-in-Fact............................................. 9 SECTION 3.06 No Liability of Mortgagee................................................... 10 SECTION 3.07 Mortgagor's Indemnities..................................................... 10 SECTION 3.08 No Modification of Mortgagor's Obligations.................................. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES......................................................... 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage....................... 11 SECTION 4.02 Taxes and Other Payments.................................................... 11 SECTION 4.03 Power to Create Lien and Security........................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture................................. 12 SECTION 4.05 Compliance with Laws........................................................ 12 SECTION 4.06 No Condemnation............................................................. 12 SECTION 4.07 Flood Zone.................................................................. 13 ARTICLE V AFFIRMATIVE COVENANTS................................................................... 13 SECTION 5.01 Lien Status................................................................. 13 SECTION 5.02 Payment of Impositions...................................................... 13 SECTION 5.03 Repair...................................................................... 14 SECTION 5.04 Insurance and Application of Insurance Proceeds............................. 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds....................... 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights.......... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations.................. 17 SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations... 17 SECTION 5.09 Additional Affirmative Covenants............................................ 18 ARTICLE VI NEGATIVE COVENANTS..................................................................... 18 SECTION 6.01 Use Violations.............................................................. 18
i SECTION 6.02 Waste....................................................................... 18 SECTION 6.03 Alterations................................................................. 18 SECTION 6.04 No Further Encumbrances..................................................... 18 SECTION 6.05 Transfer Restrictions....................................................... 18 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants.. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES........................................................ 19 SECTION 7.01 Event of Default............................................................ 19 SECTION 7.02 Acceleration................................................................ 19 SECTION 7.03 Foreclosure and Sale........................................................ 19 SECTION 7.04 Mortgagee's Agents.......................................................... 20 SECTION 7.05 Judicial Foreclosure........................................................ 20 SECTION 7.06 Receiver.................................................................... 21 SECTION 7.07 Foreclosure for Installments................................................ 21 SECTION 7.08 Separate Sales.............................................................. 21 SECTION 7.09 Possession of Mortgaged Property............................................ 21 SECTION 7.10 Occupancy After Acceleration................................................ 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive............................ 22 SECTION 7.12 No Release of Senior Secured Note Obligations............................... 22 SECTION 7.13 Release of and Resort to Collateral......................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets...................... 23 SECTION 7.15 Discontinuance of Proceedings............................................... 23 SECTION 7.16 Application of Proceeds..................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies............................................ 24 SECTION 7.18 Indemnity................................................................... 24 ARTICLE VIII MISCELLANEOUS........................................................................ 25 SECTION 8.01 Instrument Construed as Mortgage, Etc....................................... 25 SECTION 8.02 Performance at Mortgagor's Expense.......................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations................................. 25 SECTION 8.04 Further Assurances.......................................................... 25 SECTION 8.05 Notices..................................................................... 26 SECTION 8.06 No Waiver................................................................... 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures.................... 26 SECTION 8.08 Successors and Assigns...................................................... 27 SECTION 8.09 Severability................................................................ 27 SECTION 8.10 Entire Agreement and Modification........................................... 27 SECTION 8.11 Applicable Law.............................................................. 27 SECTION 8.12 Satisfaction of Prior Encumbrance........................................... 28 SECTION 8.13 No Partnership.............................................................. 28 SECTION 8.14 Headings.................................................................... 28 SECTION 8.15 Release of Mortgage......................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property............................................................... 28 SECTION 8.17 Inconsistency with Indenture................................................ 29 SECTION 8.18 Limitation on Interest Payable.............................................. 29 SECTION 8.19 Covenants To Run With the Land.............................................. 29 SECTION 8.20 Intentionally Omitted....................................................... 30 SECTION 8.21 Defense of Claims........................................................... 30 SECTION 8.22 Exculpation Provisions...................................................... 30

ii SECTION 8.23 No Merger of Estates........................................................ 30 SECTION 8.24 Release Upon Transfer or Sale............................................... 31 SECTION 8.25 Counterparts................................................................ 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS................................................... 31 SECTION 9.01 Divisions................................................................... 31 SECTION 9.02 Waste....................................................................... 31 SECTION 9.03 Foreclosure, Power of Sale.................................................. 31 SECTION 9.04 Fixture Financing Statement................................................. 32 SECTION 9.05 Assignment of Rents......................................................... 32 SECTION 9.06 Future Advances............................................................. 33 ARTICLE X INTERCREDITOR .......................................................................... 33

EXHIBIT A - LEGAL DESCRIPTION iii MORTGAGE THIS MORTGAGE, (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E U.S.A. INC., a Michigan corporation, with an office at 29111 Stephenson Highway, Madison Heights, MI 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively, the "Obligors"), and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11-1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department , commission, board bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the Senior Secured Note Obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect 3 to all minerals, coal, oil, gas and other substances of any kind or character on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, WARRANTS, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, WARRANT, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee for the Holders pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E U.S.A. Inc. Type of Organization: Corporation State: Michigan FEIN: 38-1577946 Organizational ID Number: 122-159 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. It is the intention of Mortgagor and Mortgagee that this Mortgage (as renewed and extended from time to time) shall secure future advances and 7 readavances, and the lien and security interest created by this Mortgage shall attach upon execution and have priority from the time of recording as to all advances, whether obligatory or discretionary, until this Mortgage is released of record. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the 8 payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs 9 any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article 10 III, or for any action taken by Mortgagee or such Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law be filed by Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non- 11 payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. 12 SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to 13 cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure 14 piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. 15 (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. 16 (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, 17 Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any 18 interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or 19 things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. 20 SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of 21 Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee , unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to 22 comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. 23 SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or collateral agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree 24 to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, 25 including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the 26 Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. 27 SECTION 8.12 Satisfaction of Prior Encumbrance To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) 28 ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of 29 Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally Omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. 30 SECTION 8.24 Release Upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Divisions. The Property secured by the Mortgage includes all rights to make all divisions under section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967, as amended. The Mortgagor shall not split, divide, subdivide or otherwise create separate parcels of the Property. SECTION 9.02 Waste. Mortgagor's failure to pay taxes and/or assessments assessed against the Mortgaged Property, or any installment thereof, or any insurance premium upon policies covering the Mortgaged Property or any part thereof, shall constitute waste (although the meaning of the term "waste" shall not necessarily be limited to such nonpayment), as provided by Act No. 236 of the Public Acts of Michigan of 1961, as amended, and shall entitle Mortgagee to all remedies provided for therein. Mortgagor further agrees to and does hereby consent to the appointment of a receiver under such statute, should Mortgagee elect to seek such relief thereunder. SECTION 9.03 Foreclosure, Power of Sale. Mortgagor hereby grants power to Mortgagee, in the event of the occurrence of an Event of Default hereunder, to grant, bargain, sell, release and convey the Mortgaged Property at public auction or vendue, and upon such sale to execute and deliver to the purchaser(s) instruments of conveyance pursuant to the terms hereof and to the applicable laws. Mortgagor acknowledges that the foregoing sentence confers a power of sale upon Mortgagee, and that upon default this Mortgage may be foreclosed by advertisement as described below and in the applicable Michigan statutes. Mortgagor 31 understands that upon default, Mortgagee is hereby authorized and empowered to sell the Mortgaged Property, or cause the same to be sold and to convey the same to the purchaser in any lawful manner, including but not limited to that provided by Chapter 32 of the Revised Judicature Act of Michigan, entitled "Foreclosure of Mortgages by Advertisement", which permits Mortgagee to sell the Mortgaged Property without affording Mortgagor a hearing, or giving him actual personal notice. The only notice required under such Chapter 32 is to publish notice in a local newspaper and to post a copy of the notice on the Mortgaged Property. WARNING: THIS MORTGAGE CONTAINS A POWER OF SALE AND UPON A MATURITY EVENT OF DEFAULT MAY BE FORECLOSED BY ADVERTISEMENT. IN FORECLOSURE BY ADVERTISEMENT, NO HEARING IS INVOLVED AND THE ONLY NOTICE REQUIRED IS TO BE PUBLISHED NOTICE IN A LOCAL NEWSPAPER AND TO POST A COPY OF THE NOTICE ON THE PROPERTY. WAIVER: IF THIS MORTGAGE IS FORECLOSED BY ADVERTISEMENT, MORTGAGOR HEREBY VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY WAIVES ALL RIGHTS, UNDER THE CONSTITUTION AND LAWS OF THE STATE OF MICHIGAN AND THE CONSTITUTION AND LAWS OF THE UNITED STATES, TO ALL NOTICE AND A HEARING IN CONNECTION WITH THE ABOVE MENTIONED FORECLOSURE BY ADVERTISEMENT, EXCEPT AS SET FORTH IN THE MICHIGAN STATUTE PROVIDING FOR FORECLOSURE BY ADVERTISEMENT. SECTION 9.04 Fixture Financing Statement. For purposes of Article Nine of the Michigan Uniform Commercial Code, (a) Mortgagor herein is the "debtor", (b) debtor's federal tax identification number is 38-1577946, (c) Mortgagee herein is the "secured party", (d) information concerning the security interest created hereby may be obtained from Mortgagee at its address set forth on page 1 hereof, and (e) Mortgagor's mailing address is that set forth on page 1 hereof. SECTION 9.05 Assignment of Rents. As additional security for the payment of the indebtedness evidenced by the Promissory Note, including interest thereon, and the performance of all Mortgagor's obligations hereunder or secured hereby, and under any other document executed simultaneously or in connection herewith, Mortgagor does hereby sell, assign, transfer and set over unto Mortgagee, pursuant to Act 210 of the Public Acts of Michigan of 1953, as amended, all the rents, profits and income under all leases or occupancy agreements or arrangements, however evidenced or denominated, upon or affecting the Mortgaged Property (including any extensions, amendments or renewals thereof), whether such rents, profits and income are due or are to become due, including all such leases in existence or coming into existence during the period this Mortgage is in effect. This assignment shall run with the land and be good and valid as against Mortgagor and those claiming by, under or through Mortgagor, from the date of recording of this Mortgage. This assignment shall continue to be operative during the foreclosure or any other proceedings taken to enforce this Mortgage. In the event of a foreclosure sale which results in a deficiency, this assignment shall stand as security during the redemption period for the payment of such deficiency. This assignment is given as collateral security only and does not and shall not be construed as obligating Mortgagee to perform any of the covenants or undertakings required to be performed by Mortgagor in any leases. 32 Mortgagee and its duly authorized agents shall be entitled to enter the Mortgaged Property for the purpose of delivering any and all such notices and other communications to the tenants and occupiers thereof as shall be necessary or desirable in Mortgagee's discretion to exercise its rights hereunder, and Mortgagee and its agents shall have absolutely no liability to Mortgagor arising therefrom. Mortgagee shall not, however, be obligated to give any tenant or occupier of the Mortgaged Property any notice by personal delivery and Mortgagee may, in its sole discretion, deliver all such notices and communications by ordinary first-class U. S. mail, postage prepaid, or otherwise. In the event that Mortgagor obstructs Mortgagee in its efforts to collect the rents and income from the Mortgaged Property, or after requested by Mortgagee, unreasonably refuses, fails or neglects to assist Mortgagee in collecting such rent and income, Mortgagee shall be entitled to the appointment of a receiver of the Mortgaged Property and of the income, rents and profits therefrom, with such powers as the court making such appointment may confer. Mortgagee shall at no time have any obligation whatever to attempt to collect rent from any tenant or occupier of the Mortgage Property notwithstanding that such tenants and occupiers may not be paying rent to either Mortgagor or to Mortgagee. Further, Mortgagee shall at no time have any obligation whatever to enforce any other obligations owed by tenants or occupiers of the Mortgage Property to Mortgagor. No action taken by Mortgagee under this Mortgage shall put Mortgagee in the position of a "mortgagee in possession." The provisions of this Section are not intended to evidence an additional recordable event, as may be prohibited by Act 459 of the Public Acts of Michigan of 1996, but rather are included in this Mortgage for purposes of complying with any applicable requirements of Act 210 of the Public Acts of Michigan of 1953, as amended. SECTION 9.06 Future Advances. Upon request of Mortgagor, Mortgagee, at Mortgagee's option, so long as Mortgagor is not in default hereunder, and this Mortgage secures obligations held by Mortgagee, may make Future Advances to Mortgagor. Such Future Advances, with interest thereon, shall be secured by this Mortgage. In such event, this Mortgage shall be a "Future Advance Mortgage" under Public Act 348 or Public Acts of 1990 (MCLA 565.901-906). All future advances under the Promissory Note or this Mortgage shall have the same priority as if the future advance was made on the date that this Mortgage was recorded. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. 33 [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 2 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E U.S.A. Inc., a Michigan corporation By: /s/ R.P. Lienesch -------------------------------------- Name: R.P. Lienesch Title: Treasurer ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 8, 2004, before me the undersigned personally appeared R.P. Lienesch the duly authorized Treasurer of D-M-E U.S.A. Inc., personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/ their capacity (ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ Jean Moyer ---------------------------------------- (signature and office of individual taking acknowledgment) Name of Notary public (exactly as it appears on the notary's appointment): Jean Moyer Notary Public, State of Ohio, County of Hamilton. My Commission Expires: June 11, 2007 Acting in the County of: Hamilton THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Jonathan P. Baumstark, Esq. Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Ref. No.: 030786-0117 EXHIBIT A LEGAL DESCRIPTION Address: 6328 Ferry Avenue Charlevoix, Michigan 49720 County: Charlevoix County Property Tax ID No.:_______________ A-1 EX-4.12 55 y98028exv4w12.txt MORTGAGE Exhibit 4.12 MORTGAGE made by D-M-E U.S.A. INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 29215 Stephenson Highway Madison Heights, Michigan 48071 Oakland County DATED AS OF JUNE 10, 2004 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS ..................................................................................... 2 SECTION 1.01 Terms Defined Above.................................................................... 2 SECTION 1.02 Definitions............................................................................ 2 SECTION 1.03 Terminology............................................................................ 6 SECTION 1.04 Other Defined Terms.................................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST............................................................. 6 SECTION 2.01 Grant of Lien.......................................................................... 6 SECTION 2.02 Grant of Security Interest............................................................. 7 SECTION 2.03 No Obligation of Mortgagee............................................................. 7 SECTION 2.04 Fixture Filing......................................................................... 7 SECTION 2.05 Future Advances........................................................................ 8 ARTICLE III ASSIGNMENT OF LEASES AND RENTS................................................................. 8 SECTION 3.01 Assignment............................................................................. 8 SECTION 3.02 Revocable License...................................................................... 8 SECTION 3.03 Enforcement of Leases.................................................................. 9 SECTION 3.04 Direction to Tenants................................................................... 9 SECTION 3.05 Appointment of Attorney-in-Fact........................................................ 10 SECTION 3.06 No Liability of Mortgagee.............................................................. 10 SECTION 3.07 Mortgagor's Indemnities................................................................ 11 SECTION 3.08 No Modification of Mortgagor's Obligations............................................. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES.................................................................. 12 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage.................................. 12 SECTION 4.02 Taxes and Other Payments............................................................... 12 SECTION 4.03 Power to Create Lien and Security...................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture............................................ 12 SECTION 4.05 Compliance with Laws................................................................... 13 SECTION 4.06 No Condemnation........................................................................ 13 SECTION 4.07 Flood Zone............................................................................. 13 ARTICLE V AFFIRMATIVE COVENANTS............................................................................ 13 SECTION 5.01 Lien Status............................................................................ 13 SECTION 5.02 Payment of Impositions................................................................. 14 SECTION 5.03 Repair................................................................................. 14 SECTION 5.04 Insurance and Application of Insurance Proceeds........................................ 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds.................................. 17 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights..................... 18 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............................. 18 SECTION 5.08 Compliance with Permitted Liens and Other Obligations.................................. 18 SECTION 5.09 Additional Affirmative Covenants....................................................... 18 ARTICLE VI NEGATIVE COVENANTS.............................................................................. 19 SECTION 6.01 Use Violations......................................................................... 19
i SECTION 6.02 Waste.................................................................................. 19 SECTION 6.03 Alterations............................................................................ 19 SECTION 6.04 No Further Encumbrances................................................................ 19 SECTION 6.05 Transfer Restrictions.................................................................. 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES................................................................. 20 SECTION 7.01 Event of Default....................................................................... 20 SECTION 7.02 Acceleration........................................................................... 20 SECTION 7.03 Foreclosure and Sale................................................................... 20 SECTION 7.04 Mortgagee's Agents..................................................................... 21 SECTION 7.05 Judicial Foreclosure................................................................... 21 SECTION 7.06 Receiver............................................................................... 21 SECTION 7.07 Foreclosure for Installments........................................................... 22 SECTION 7.08 Separate Sales......................................................................... 22 SECTION 7.09 Possession of Mortgaged Property....................................................... 22 SECTION 7.10 Occupancy After Acceleration........................................................... 23 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive....................................... 23 SECTION 7.12 No Release of Senior Secured Note Obligations.......................................... 24 SECTION 7.13 Release of and Resort to Collateral.................................................... 24 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................................. 24 SECTION 7.15 Discontinuance of Proceedings.......................................................... 25 SECTION 7.16 Application of Proceeds................................................................ 25 SECTION 7.17 Uniform Commercial Code Remedies....................................................... 25 SECTION 7.18 Indemnity.............................................................................. 26 ARTICLE VIII MISCELLANEOUS................................................................................. 26 SECTION 8.01 Instrument Construed as Mortgage, Etc.................................................. 26 SECTION 8.02 Performance at Mortgagor's Expense..................................................... 27 SECTION 8.03 Survival of Senior Secured Note Obligations............................................ 27 SECTION 8.04 Further Assurances..................................................................... 27 SECTION 8.05 Notices................................................................................ 27 SECTION 8.06 No Waiver.............................................................................. 27 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures............................... 27 SECTION 8.08 Successors and Assigns................................................................. 28 SECTION 8.09 Severability........................................................................... 28 SECTION 8.10 Entire Agreement and Modification...................................................... 29 SECTION 8.11 Applicable Law......................................................................... 29 SECTION 8.12 Satisfaction of Prior Encumbrance...................................................... 29 SECTION 8.13 No Partnership......................................................................... 29 SECTION 8.14 Headings............................................................................... 29 SECTION 8.15 Release of Mortgage.................................................................... 29 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property....... 30 SECTION 8.17 Inconsistency with Indenture........................................................... 30 SECTION 8.18 Limitation on Interest Payable......................................................... 30

ii SECTION 8.19 Covenants To Run With the Land......................................................... 31 SECTION 8.20 Intentionally omitted.................................................................. 31 SECTION 8.21 Defense of Claims...................................................................... 31 SECTION 8.22 Exculpation Provisions................................................................. 31 SECTION 8.23 No Merger of Estates................................................................... 32 SECTION 8.24 Release upon Transfer or Sale.......................................................... 32 SECTION 8.25 Counterparts........................................................................... 32 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS............................................................ 33 SECTION 9.01 Divisions.............................................................................. 33 SECTION 9.02 Waste.................................................................................. 33 SECTION 9.03 Foreclosure, Power of Sale............................................................. 33 SECTION 9.04 Fixture Financing Statement............................................................ 34 SECTION 9.05 Assignment of Rents.................................................................... 34 SECTION 9.06 Future Advances........................................................................ 35 ARTICLE X intercreditor.................................................................................... 35

EXHIBIT A - LEGAL DESCRIPTION iii MORTGAGE THIS MORTGAGE, (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E U.S.A. INC., a Michigan corporation, with an office at 29215 Stephenson Highway, Madison Heights, Michigan 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). R E C I T A L S: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively, the "Obligors"), and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11-1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. - 2 - "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of - 3 - land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; - 4 - (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations(as hereinafter defined); (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter - 5 - located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, WARRANTS, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, - 6 - however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, WARRANT, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E U.S.A. Inc. Type of Organization: Corporation - 7 - State: Michigan FEIN: 38-1577946 Organizational ID Number: 122-159 Name of Secured Party: U.S. Bank National Association Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. It is the intention of Mortgagor and Mortgagee that this Mortgage (as renewed and extended from time to time) shall secure future advances and readavances, and the lien and security interest created by this Mortgage shall attach upon execution and have priority from the time of recording as to all advances, whether obligatory or discretionary, until this Mortgage is released of record. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor - 8 - hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due - 9 - under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or - 10 - any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or such Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. - 11 - ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. - 12 - SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is - 13 - asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. - 14 - (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (b) (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. - 15 - (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (c) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (d) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (e) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (f) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision - 16 - contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged - 17 - Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to - 18 - itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by - 19 - Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing - 20 - to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the - 21 - Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of - 22 - Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. - 23 - SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors, Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. - 24 - SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. - 25 - SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or any other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. - 26 - SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. - 27 - (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document , including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document , (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. - 28 - SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. This Mortgage shall be governed by, and construed in accordance with, the INTERNAL laws of the State in which the Mortgaged Property is located; provided, however, that the Indenture, the Notes and the Guarantee are, by their terms, governed by the internal laws of the State of New York AS PROVIDED THEREIN, and, in the event that it becomes necessary, in connection with the enforcement of this mortgage or otherwise, to construe or enforce the obligations (which obligations are secured by this mortgage), the Indenture, the Notes and the Guarantee shall be construed and enforced in accordance with the internal laws of the state of New York. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. - 29 - SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury - 30 - laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE - 31 - AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. - 32 - ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Divisions. The Property secured by the Mortgage includes all rights to make all divisions under section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967, as amended. The Mortgagor shall not split, divide, subdivide or otherwise create separate parcels of the Property. SECTION 9.02 Waste. Mortgagor's failure to pay taxes and/or assessments assessed against the Mortgaged Property, or any installment thereof, or any insurance premium upon policies covering the Mortgaged Property or any part thereof, shall constitute waste (although the meaning of the term "waste" shall not necessarily be limited to such nonpayment), as provided by Act No. 236 of the Public Acts of Michigan of 1961, as amended, and shall entitle Mortgagee to all remedies provided for therein. Mortgagor further agrees to and does hereby consent to the appointment of a receiver under such statute, should Mortgagee elect to seek such relief thereunder. SECTION 9.03 Foreclosure, Power of Sale. Mortgagor hereby grants power to Mortgagee, in the event of the occurrence of an Event of Default hereunder, to grant, bargain, sell, release and convey the Mortgaged Property at public auction or venue, and upon such sale to execute and deliver to the purchaser(s) instruments of conveyance pursuant to the terms hereof and to the applicable laws. Mortgagor acknowledges that the foregoing sentence confers a power of sale upon Mortgagee, and that upon default this Mortgage may be foreclosed by advertisement as described below and in the applicable Michigan statutes. Mortgagor understands that upon default, Mortgagee is hereby authorized and empowered to sell the Mortgaged Property, or cause the same to be sold and to convey the same to the purchaser in any lawful manner, including but not limited to that provided by Chapter 32 of the Revised Judicature Act of Michigan, entitled "Foreclosure of Mortgages by Advertisement", which permits Mortgagee to sell the Mortgaged Property without affording Mortgagor a hearing, or giving him actual personal notice. The only notice required under such Chapter 32 is to publish notice in a local newspaper and to post a copy of the notice on the Mortgaged Property. WARNING: THIS MORTGAGE CONTAINS A POWER OF SALE AND UPON A MATURITY EVENT OF DEFAULT MAY BE FORECLOSED BY ADVERTISEMENT. IN FORECLOSURE BY ADVERTISEMENT, NO HEARING IS INVOLVED AND THE ONLY NOTICE REQUIRED IS TO BE PUBLISHED NOTICE IN A LOCAL NEWSPAPER AND TO POST A COPY OF THE NOTICE ON THE PROPERTY. WAIVER: IF THIS MORTGAGE IS FORECLOSED BY ADVERTISEMENT, MORTGAGOR HEREBY VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY WAIVES ALL RIGHTS, UNDER THE CONSTITUTION AND LAWS OF THE STATE OF MICHIGAN AND THE CONSTITUTION AND LAWS OF THE UNITED STATES, TO ALL NOTICE AND A HEARING IN CONNECTION WITH THE ABOVE MENTIONED - 33 - FORECLOSURE BY ADVERTISEMENT, EXCEPT AS SET FORTH IN THE MICHIGAN STATUTE PROVIDING FOR FORECLOSURE BY ADVERTISEMENT. SECTION 9.04 Fixture Financing Statement. For purposes of Article Nine of the Michigan Uniform Commercial Code, (a) Mortgagor herein is the "debtor", (b) debtor's federal tax identification number is 38-1577946, (c) Mortgagee herein is the "secured party", (d) information concerning the security interest created hereby may be obtained from Mortgagee at its address set forth on page 1 hereof, and (e) Mortgagor's mailing address is that set forth on page 1 hereof. SECTION 9.05 Assignment of Rents. As additional security for the payment of the indebtedness evidenced by the Promissory Note, including interest thereon, and the performance of all of Mortgagor's obligations hereunder or secured hereby, and under any other document executed simultaneously or in connection herewith, Mortgagor does hereby sell, assign, transfer and set over unto Mortgagee, pursuant to Act 210 of the Public Acts of Michigan of 1953, as amended, all the rents, profits and income under all leases or occupancy agreements or arrangements, however evidenced or denominated, upon or affecting the Mortgaged Property (including any extensions, amendments or renewals thereof), whether such rents, profits and income are due or are to become due, including all such leases in existence or coming into existence during the period this Mortgage is in effect. This assignment shall run with the land and be good and valid as against Mortgagor and those claiming by, under or through Mortgagor, from the date of recording of this Mortgage. This assignment shall continue to be operative during the foreclosure or any other proceedings taken to enforce this Mortgage. In the event of a foreclosure sale which results in a deficiency, this assignment shall stand as security during the redemption period for the payment of such deficiency. This assignment is given as collateral security only and does not and shall not be construed as obligating Mortgagee to perform any of the covenants or undertakings required to be performed by Mortgagor in any leases. Mortgagee and its duly authorized agents shall be entitled to enter the Mortgaged Property for the purpose of delivering any and all such notices and other communications to the tenants and occupiers thereof as shall be necessary or desirable in Mortgagee's discretion to exercise its rights hereunder, and Mortgagee and its agents shall have absolutely no liability to Mortgagor arising therefrom. Mortgagee shall not, however, be obligated to give any tenant or occupier of the Mortgaged Property any notice by personal delivery and Mortgagee may, in its sole discretion, deliver all such notices and communications by ordinary first-class U. S. mail, postage prepaid, or otherwise. In the event that Mortgagor obstructs Mortgagee in its efforts to collect the rents and income from the Mortgaged Property, or after requested by Mortgagee, unreasonably refuses, fails or neglects to assist Mortgagee in collecting such rent and income, Mortgagee shall be entitled to the appointment of a receiver of the Mortgaged Property and of the income, rents and profits therefrom, with such powers as the court making such appointment may confer. Mortgagee shall at no time have any obligation whatever to attempt to collect rent from any tenant or occupier of the Mortgage Property notwithstanding that such tenants and - 34 - occupiers may not be paying rent to either Mortgagor or to Mortgagee. Further, Mortgagee shall at no time have any obligation whatever to enforce any other obligations owed by tenants or occupiers of the Mortgage Property to Mortgagor. No action taken by Mortgagee under this Mortgage shall put Mortgagee in the position of a "mortgagee in possession." The provisions of this Section are not intended to evidence an additional recordable event, as may be prohibited by Act 459 of the Public Acts of Michigan of 1996, but rather are included in this Mortgage for purposes of complying with any applicable requirements of Act 210 of the Public Acts of Michigan of 1953, as amended. SECTION 9.06 Future Advances. Upon request of Mortgagor, Mortgagee, at Mortgagee's option, so long as Mortgagor is not in default hereunder, and this Mortgage secures obligations held by Mortgagee, may make Future Advances to Mortgagor. Such Future Advances, with interest thereon, shall be secured by this Mortgage. In such event, this Mortgage shall be a "Future Advance Mortgage" under Public Act 348 or Public Acts of 1990 (MCLA 565.901-906). All future advances under the Promissory Note or this Mortgage shall have the same priority as if the future advance was made on the date that this Mortgage was recorded. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] - 35 - IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E U.S.A. Inc., a Michigan corporation By: /s/ R.P. Lienesch ------------------ Name: R.P. Lienesch Title: Treasurer ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 8, 2004, before me the undersigned personally appeared R.P. Lienesch the duly authorized Treasurer of D-M-E U.S.A. Inc., personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/ their capacity (ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ Jean Moyer -------------- (signature and office of individual taking acknowledgment) Name of Notary public (exactly as it appears on the notary's appointment): Jean Moyer Notary Public, State of Ohio, County of Hamilton. My Commission Expires: June 11, 2007 Acting in the County of: Hamilton THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Jonathan P. Baumstark, Esq. Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Ref. No.: 030786-0117 EXHIBIT A LEGAL DESCRIPTION Address: 29215 Stephenson Highway Madison Heights, Michigan 48071 County: Oakland Property Tax ID No.: ____________________ A-1 EX-4.13 56 y98028exv4w13.txt MORTGAGE Exhibit 4.13 MORTGAGE made by OAK INTERNATIONAL, INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 1160 White Street Sturgis, Michigan 49091 St. Joseph County DATED AS OF JUNE 10, 2004 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS......................................................................... 2 SECTION 1.01 Terms Defined Above.................................................... 2 SECTION 1.02 Definitions............................................................ 2 SECTION 1.03 Terminology............................................................ 6 SECTION 1.04 Other Defined Terms.................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................ 6 SECTION 2.01 Grant of Lien.......................................................... 6 SECTION 2.02 Grant of Security Interest............................................. 7 SECTION 2.03 No Obligation of Mortgagee............................................. 7 SECTION 2.04 Fixture Filing......................................................... 7 SECTION 2.05 Future Advances........................................................ 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS.................................................... 8 SECTION 3.01 Assignment............................................................. 8 SECTION 3.02 Revocable License...................................................... 8 SECTION 3.03 Enforcement of Leases.................................................. 9 SECTION 3.04 Direction to Tenants................................................... 9 SECTION 3.05 Appointment of Attorney-in-Fact........................................ 9 SECTION 3.06 No Liability of Mortgagee.............................................. 10 SECTION 3.07 Mortgagor's Indemnities................................................ 10 SECTION 3.08 No Modification of Mortgagor's Obligations............................. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES..................................................... 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage.................. 11 SECTION 4.02 Taxes and Other Payments............................................... 11 SECTION 4.03 Power to Create Lien and Security...................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture............................ 12 SECTION 4.05 Compliance with Laws................................................... 12 SECTION 4.06 No Condemnation........................................................ 12 SECTION 4.07 Flood Zone............................................................. 12 ARTICLE V AFFIRMATIVE COVENANTS............................................................... 13 SECTION 5.01 Lien Status............................................................ 13 SECTION 5.02 Payment of Impositions................................................. 13 SECTION 5.03 Repair................................................................. 14 SECTION 5.04 Insurance and Application of Insurance Proceeds........................ 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds.................. 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights..... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............. 17 SECTION 5.08 Compliance with Permitted Liens and Other Obligations.................. 17 SECTION 5.09 Additional Affirmative Covenants....................................... 18 ARTICLE VI NEGATIVE COVENANTS................................................................. 18 SECTION 6.01 Use Violations......................................................... 18
i SECTION 6.02 Waste.................................................................. 18 SECTION 6.03 Alterations............................................................ 18 SECTION 6.04 No Further Encumbrances................................................ 18 SECTION 6.05 Transfer Restrictions.................................................. 18 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants.............................................................. 18 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES.................................................... 19 SECTION 7.01 Event of Default....................................................... 19 SECTION 7.02 Acceleration........................................................... 19 SECTION 7.03 Foreclosure and Sale................................................... 19 SECTION 7.04 Mortgagee's Agents..................................................... 20 SECTION 7.05 Judicial Foreclosure................................................... 20 SECTION 7.06 Receiver............................................................... 20 SECTION 7.07 Foreclosure for Installments........................................... 21 SECTION 7.08 Separate Sales......................................................... 21 SECTION 7.09 Possession of Mortgaged Property....................................... 21 SECTION 7.10 Occupancy After Acceleration........................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive....................... 22 SECTION 7.12 No Release of Senior Secured Note Obligations.......................... 22 SECTION 7.13 Release of and Resort to Collateral.................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................. 23 SECTION 7.15 Discontinuance of Proceedings.......................................... 23 SECTION 7.16 Application of Proceeds................................................ 23 SECTION 7.17 Uniform Commercial Code Remedies....................................... 24 SECTION 7.18 Indemnity.............................................................. 24 ARTICLE VIII MISCELLANEOUS.................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc.................................. 25 SECTION 8.02 Performance at Mortgagor's Expense..................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations............................ 25 SECTION 8.04 Further Assurances..................................................... 25 SECTION 8.05 Notices................................................................ 26 SECTION 8.06 No Waiver.............................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures............... 26 SECTION 8.08 Successors and Assigns................................................. 27 SECTION 8.09 Severability........................................................... 27 SECTION 8.10 Entire Agreement and Modification...................................... 27 SECTION 8.11 Applicable Law......................................................... 27 SECTION 8.12 Satisfaction of Prior Encumbrance...................................... 27 SECTION 8.13 No Partnership......................................................... 28 SECTION 8.14 Headings............................................................... 28 SECTION 8.15 Release of Mortgage.................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property..................................................... 28 SECTION 8.17 Inconsistency with Indenture........................................... 29 SECTION 8.18 Limitation on Interest Payable......................................... 29

ii SECTION 8.19 Covenants To Run With the Land......................................... 29 SECTION 8.20 Intentionally Omitted.................................................. 30 SECTION 8.21 Defense of Claims...................................................... 30 SECTION 8.22 Exculpation Provisions................................................. 30 SECTION 8.23 No Merger of Estates................................................... 30 SECTION 8.24 Release Upon Transfer or Sale.......................................... 30 SECTION 8.25 Counterparts........................................................... 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS............................................... 31 SECTION 9.01 Divisions.............................................................. 31 SECTION 9.02 Waste.................................................................. 31 SECTION 9.03 Foreclosure, Power of Sale............................................. 31 SECTION 9.04 Fixture Financing Statement............................................ 32 SECTION 9.05 Assignment of Rents.................................................... 32 SECTION 9.06 Future Advances........................................................ 33 ARTICLE X INTERCREDITOR....................................................................... 33

EXHIBIT A - LEGAL DESCRIPTION iii MORTGAGE THIS MORTGAGE, (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by OAK INTERNATIONAL, INC., a Michigan corporation, with an office at 1160 White Street, Sturgis, Michigan 49091, ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). R E C I T A L S: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively the "Obligors"), and Mortgagee, in its capacity as Trustee are parties to that certain Indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the Senior Secured Note Obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect 3 to all minerals, coal, oil, gas and other substances of any kind or character on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, WARRANTS, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, WARRANT, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: Oak International, Inc. Type of Organization: corporation State: Michigan FEIN: 38-2007743 Organizational ID Number: 120-709 Name of Secured Party: U.S. Bank National Association Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. It is the intention of Mortgagor and Mortgagee that this Mortgage (as renewed and extended from time to time) shall secure future advances and readavances, and the lien and security interest created by this Mortgage shall attach upon 7 execution and have priority from the time of recording as to all advances, whether obligatory or discretionary, until this Mortgage is released of record. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the 8 terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in 9 accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee 10 or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment there of on Mortgagor's financial statements to the extent required by and in accordance 11 with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the 12 Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all 13 interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). 14 (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and 15 empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the 16 provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of 17 the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and 18 provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Borrowers or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have 19 constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of 20 competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to 21 perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent 22 owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligot or any of the Guarantors, Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available 23 therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnitee or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or any other Indemnitee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or any Indemnitee, or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by 24 reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. 25 SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such 26 costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding 27 Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the 28 other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. 29 SECTION 8.20 Intentionally Omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release Upon Transfer or Sale. 30 (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Divisions. The Property secured by the Mortgage includes all rights to make all divisions under section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967, as amended. The Mortgagor shall not split, divide, subdivide or otherwise create separate parcels of the Property. SECTION 9.02 Waste. Mortgagor's failure to pay taxes and/or assessments assessed against the Mortgaged Property, or any installment thereof, or any insurance premium upon policies covering the Mortgaged Property or any part thereof, shall constitute waste (although the meaning of the term "waste" shall not necessarily be limited to such nonpayment), as provided by Act No. 236 of the Public Acts of Michigan of 1961, as amended, and shall entitle Mortgagee to all remedies provided for therein. Mortgagor further agrees to and does hereby consent to the appointment of a receiver under such statute, should Mortgagee elect to seek such relief thereunder. SECTION 9.03 Foreclosure, Power of Sale. Mortgagor hereby grants power to Mortgagee, in the event of the occurrence of an Event of Default hereunder, to grant, bargain, sell, release and convey the Mortgaged Property at public auction or vendue, and upon such sale to execute and deliver to the purchaser(s) instruments of conveyance pursuant to the terms hereof and to the applicable laws. Mortgagor acknowledges that the foregoing sentence confers a power of sale upon Mortgagee, and that upon default this Mortgage may be foreclosed by advertisement as described below and in the applicable Michigan statutes. Mortgagor understands that upon default, Mortgagee is hereby authorized and empowered to sell the 31 Mortgaged Property, or cause the same to be sold and to convey the same to the purchaser in any lawful manner, including but not limited to that provided by Chapter 32 of the Revised Judicature Act of Michigan, entitled "Foreclosure of Mortgages by Advertisement", which permits Mortgagee to sell the Mortgaged Property without affording Mortgagor a hearing, or giving him actual personal notice. The only notice required under such Chapter 32 is to publish notice in a local newspaper and to post a copy of the notice on the Mortgaged Property. WARNING: THIS MORTGAGE CONTAINS A POWER OF SALE AND UPON A MATURITY EVENT OF DEFAULT MAY BE FORECLOSED BY ADVERTISEMENT. IN FORECLOSURE BY ADVERTISEMENT, NO HEARING IS INVOLVED AND THE ONLY NOTICE REQUIRED IS TO BE PUBLISHED NOTICE IN A LOCAL NEWSPAPER AND TO POST A COPY OF THE NOTICE ON THE PROPERTY. WAIVER: IF THIS MORTGAGE IS FORECLOSED BY ADVERTISEMENT, MORTGAGOR HEREBY VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY WAIVES ALL RIGHTS, UNDER THE CONSTITUTION AND LAWS OF THE STATE OF MICHIGAN AND THE CONSTITUTION AND LAWS OF THE UNITED STATES, TO ALL NOTICE AND A HEARING IN CONNECTION WITH THE ABOVE MENTIONED FORECLOSURE BY ADVERTISEMENT, EXCEPT AS SET FORTH IN THE MICHIGAN STATUTE PROVIDING FOR FORECLOSURE BY ADVERTISEMENT. SECTION 9.04 Fixture Financing Statement. For purposes of Article Nine of the Michigan Uniform Commercial Code, (a) Mortgagor herein is the "debtor", (b) debtor's federal tax identification number is 38-2007743, (c) Mortgagee herein is the "secured party", (d) information concerning the security interest created hereby may be obtained from Mortgagee at its address set forth on page 1 hereof, and (e) Mortgagor's mailing address is that set forth on page 1 hereof. SECTION 9.05 Assignment of Rents. As additional security for the payment of the indebtedness evidenced by the Promissory Note, including interest thereon, and the performance of all of Mortgagor's obligations hereunder or secured hereby, and under any other document executed simultaneously or in connection herewith, Mortgagor does hereby sell, assign, transfer and set over unto Mortgagee, pursuant to Act 210 of the Public Acts of Michigan of 1953, as amended, all the rents, profits and income under all leases or occupancy agreements or arrangements, however evidenced or denominated, upon or affecting the Mortgaged Property (including any extensions, amendments or renewals thereof), whether such rents, profits and income are due or are to become due, including all such leases in existence or coming into existence during the period this Mortgage is in effect. This assignment shall run with the land and be good and valid as against Mortgagor and those claiming by, under or through Mortgagor, from the date of recording of this Mortgage. This assignment shall continue to be operative during the foreclosure or any other proceedings taken to enforce this Mortgage. In the event of a foreclosure sale which results in a deficiency, this assignment shall stand as security during the redemption period for the payment of such deficiency. This assignment is given as collateral security only and does not and shall not be construed as obligating Mortgagee to perform any of the covenants or undertakings required to be performed by Mortgagor in any leases. 32 Mortgagee and its duly authorized agents shall be entitled to enter the Mortgaged Property for the purpose of delivering any and all such notices and other communications to the tenants and occupiers thereof as shall be necessary or desirable in Mortgagee's discretion to exercise its rights hereunder, and Mortgagee and its agents shall have absolutely no liability to Mortgagor arising therefrom. Mortgagee shall not, however, be obligated to give any tenant or occupier of the Mortgaged Property any notice by personal delivery and Mortgagee may, in its sole discretion, deliver all such notices and communications by ordinary first-class U.S. mail, postage prepaid, or otherwise. In the event that Mortgagor obstructs Mortgagee in its efforts to collect the rents and income from the Mortgaged Property, or after requested by Mortgagee, unreasonably refuses, fails or neglects to assist Mortgagee in collecting such rent and income, Mortgagee shall be entitled to the appointment of a receiver of the Mortgaged Property and of the income, rents and profits therefrom, with such powers as the court making such appointment may confer. Mortgagee shall at no time have any obligation whatever to attempt to collect rent from any tenant or occupier of the Mortgage Property notwithstanding that such tenants and occupiers may not be paying rent to either Mortgagor or to Mortgagee. Further, Mortgagee shall at no time have any obligation whatever to enforce any other obligations owed by tenants or occupiers of the Mortgage Property to Mortgagor. No action taken by Mortgagee under this Mortgage shall put Mortgagee in the position of a "mortgagee in possession." The provisions of this Section are not intended to evidence an additional recordable event, as may be prohibited by Act 459 of the Public Acts of Michigan of 1996, but rather are included in this Mortgage for purposes of complying with any applicable requirements of Act 210 of the Public Acts of Michigan of 1953, as amended. SECTION 9.06 Future Advances. Upon request of Mortgagor, Mortgagee, at Mortgagee's option, so long as Mortgagor is not in default hereunder, and this Mortgage secures obligations held by Mortgagee, may make Future Advances to Mortgagor. Such Future Advances, with interest thereon, shall be secured by this Mortgage. In such event, this Mortgage shall be a "Future Advance Mortgage" under Public Act 348 or Public Acts of 1990 (MCLA 565.901-906). All future advances under the Promissory Note or this Mortgage shall have the same priority as if the future advance was made on the date that this Mortgage was recorded. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 33 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: OAK INTERNATIONAL, INC., a Michigan Corporation By: /s/ R.P. Lienesch ------------------ Name: R.P. Lienesch Title: Treasurer ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 8, 2004, before me the undersigned personally appeared R.P. Lienesch the duly authorized Treasurer of Oak International, Inc., personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/ their capacity (ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ Jean Moyer -------------- (signature and office of individual taking acknowledgment) Name of Notary public (exactly as it appears on the notary's appointment): Jean Moyer Notary Public, State of Ohio, County of Hamilton. My Commission Expires: June 11, 2007 Acting in the County of: Hamilton THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Jonathan P. Baumstark, Esq. Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Ref. No.: 030786-0117 EXHIBIT A LEGAL DESCRIPTION Address: 1160 White Street Sturgis, Michigan 49091 County: St. Joseph County Property Tax ID No.: ____________________ A-1 EX-4.14 57 y98028exv4w14.txt MORTGAGE Exhibit 4.14 MORTGAGE made by MILACRON INDUSTRIAL PRODUCTS, INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 31003 Industrial Road Livonia, Michigan 48150 Wayne County DATED AS OF JUNE 10, 2004 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS.................................................................................. 2 SECTION 1.01 Terms Defined Above.............................................................. 2 SECTION 1.02 Definitions...................................................................... 2 SECTION 1.03 Terminology...................................................................... 6 SECTION 1.04 Other Defined Terms.............................................................. 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST......................................................... 6 SECTION 2.01 Grant of Lien.................................................................... 6 SECTION 2.02 Grant of Security Interest....................................................... 7 SECTION 2.03 No Obligation of Mortgagee....................................................... 7 SECTION 2.04 Fixture Filing................................................................... 7 SECTION 2.05 Future Advances.................................................................. 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS............................................................. 8 SECTION 3.01 Assignment....................................................................... 8 SECTION 3.02 Revocable License................................................................ 8 SECTION 3.03 Enforcement of Leases............................................................ 9 SECTION 3.04 Direction to Tenants............................................................. 9 SECTION 3.05 Appointment of Attorney-in-Fact.................................................. 9 SECTION 3.06 No Liability of Mortgagee........................................................ 10 SECTION 3.07 Mortgagor's Indemnities.......................................................... 10 SECTION 3.08 No Modification of Mortgagor's Obligations....................................... 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES.............................................................. 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage............................ 11 SECTION 4.02 Taxes and Other Payments......................................................... 11 SECTION 4.03 Power to Create Lien and Security................................................ 12 SECTION 4.04 Secured Senior Note Documents and Indenture...................................... 12 SECTION 4.05 Compliance with Laws............................................................. 12 SECTION 4.06 No Condemnation.................................................................. 12 SECTION 4.07 Flood Zone....................................................................... 13 ARTICLE V AFFIRMATIVE COVENANTS........................................................................ 13 SECTION 5.01 Lien Status...................................................................... 13 SECTION 5.02 Payment of Impositions........................................................... 13 SECTION 5.03 Repair........................................................................... 14 SECTION 5.04 Insurance and Application of Insurance Proceeds.................................. 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds............................ 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights............... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations....................... 17 SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations........ 17 SECTION 5.09 Additional Affirmative Covenants................................................. 18 ARTICLE VI NEGATIVE COVENANTS.......................................................................... 18 SECTION 6.01 Use Violations................................................................... 18 SECTION 6.02 Waste............................................................................ 18 SECTION 6.03 Alterations...................................................................... 18 SECTION 6.04 No Further Encumbrances.......................................................... 18
i SECTION 6.05 Transfer Restrictions............................................................ 19 SECTION 6.06 Secured Senior Note Documents and Indenture; Additional Negative Covenants....... 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES............................................................. 19 SECTION 7.01 Event of Default................................................................. 19 SECTION 7.02 Acceleration..................................................................... 19 SECTION 7.03 Foreclosure and Sale............................................................. 19 SECTION 7.04 Mortgagee's Agents............................................................... 20 SECTION 7.05 Judicial Foreclosure............................................................. 20 SECTION 7.06 Receiver......................................................................... 21 SECTION 7.07 Foreclosure for Installments..................................................... 21 SECTION 7.08 Separate Sales................................................................... 21 SECTION 7.09 Possession of Mortgaged Property................................................. 21 SECTION 7.10 Occupancy After Acceleration..................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive................................. 22 SECTION 7.12 No Release of Senior Secured Note Obligations.................................... 23 SECTION 7.13 Release of and Resort to Collateral.............................................. 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets........................... 23 SECTION 7.15 Discontinuance of Proceedings.................................................... 23 SECTION 7.16 Application of Proceeds.......................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies................................................. 24 SECTION 7.18 Indemnity........................................................................ 24 ARTICLE VIII MISCELLANEOUS............................................................................. 25 SECTION 8.01 Instrument Construed as Mortgage, Etc............................................ 25 SECTION 8.02 Performance at Mortgagor's Expense............................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations...................................... 25 SECTION 8.04 Further Assurances............................................................... 26 SECTION 8.05 Notices.......................................................................... 26 SECTION 8.06 No Waiver........................................................................ 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures......................... 26 SECTION 8.08 Successors and Assigns........................................................... 27 SECTION 8.09 Severability..................................................................... 27 SECTION 8.10 Entire Agreement and Modification................................................ 27 SECTION 8.11 Applicable Law................................................................... 27 SECTION 8.12 Satisfaction of Prior Encumbrance................................................ 28 SECTION 8.13 No Partnership................................................................... 28 SECTION 8.14 Headings......................................................................... 28 SECTION 8.15 Release of Mortgage.............................................................. 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property.................................................................... 28 SECTION 8.17 Inconsistency with Indenture..................................................... 29 SECTION 8.18 Limitation on Interest Payable................................................... 29 SECTION 8.19 Covenants To Run With the Land................................................... 30 SECTION 8.20 Intentionally Omitted............................................................ 30 SECTION 8.21 Defense of Claims................................................................ 30 SECTION 8.22 Exculpation Provisions........................................................... 30 SECTION 8.23 No Merger of Estates............................................................. 30 SECTION 8.24 Release upon Transfer or Sale.................................................... 31 SECTION 8.25 Counterparts..................................................................... 31

ii ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS........................................................ 31 SECTION 9.01 Divisions........................................................................ 31 SECTION 9.02 Waste............................................................................ 31 SECTION 9.03 Foreclosure, Power of Sale....................................................... 31 SECTION 9.04 Fixture Financing Statement...................................................... 32 SECTION 9.05 Assignment of Rents.............................................................. 32 SECTION 9.06 Future Advances.................................................................. 33 ARTICLE X INTERCREDITOR................................................................................ 33

EXHIBIT A - LEGAL DESCRIPTION iii MORTGAGE THIS MORTGAGE, (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by MILACRON INDUSTRIAL PRODUCTS, INC., a Michigan corporation, having an office at 1160 White Street, Sturgis, Michigan 49091 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively, the "Obligors"), and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Secured Senior Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Secured Senior Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, WARRANTS, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, WARRANT, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: Milacron Industrial Products, Inc. Type of Organization: corporation State: Michigan FEIN: 38-3457667 Organizational ID Number: 00777A Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. It is the intention of Mortgagor and Mortgagee that this Mortgage (as renewed and extended from time to time) shall secure future advances and readavances, and the lien and security interest created by this Mortgage shall attach upon 7 execution and have priority from the time of recording as to all advances, whether obligatory or discretionary, until this Mortgage is released of record. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Secured Senior Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the 8 terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, 9 and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or Indemnified Party hereunder, or by reason or in 10 defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the 11 payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Secured Senior Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Secured Senior Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Secured Senior Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. 12 SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to 13 cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure 14 piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. 15 (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Secured Senior Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Secured Senior Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. 16 (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Secured Senior Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Secured Senior Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations. Mortgagor shall comply in all material respects with any and all Senior Secured Note Obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture.. 17 In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Secured Senior Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. 18 SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Secured Senior Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Secured Senior Note Documents. All negative covenants made by the Borrowers or Guarantors or any of them in the Indenture and the other Secured Senior Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Secured Senior Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of 19 Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale 20 of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, 21 Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Secured Senior Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee , unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. 22 SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors, Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Secured Senior Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored 23 to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Secured Senior Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Secured Senior Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or 24 Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PERSON WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PERSON OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Secured Senior Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. 25 SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Secured Senior Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Secured Senior Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Secured Senior Note 26 Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Secured Senior Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Secured Senior Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Secured Senior Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF 27 THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. 28 (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Secured Senior Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Secured Senior Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. 29 SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally Omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, 30 notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Divisions. The Property secured by the Mortgage includes all rights to make all divisions under section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967, as amended. The Mortgagor shall not split, divide, subdivide or otherwise create separate parcels of the Property. SECTION 9.02 Waste. Mortgagor's failure to pay taxes and/or assessments assessed against the Mortgaged Property, or any installment thereof, or any insurance premium upon policies covering the Mortgaged Property or any part thereof, shall constitute waste (although the meaning of the term "waste" shall not necessarily be limited to such nonpayment), as provided by Act No. 236 of the Public Acts of Michigan of 1961, as amended, and shall entitle Mortgagee to all remedies provided for therein. Mortgagor further agrees to and does hereby consent to the appointment of a receiver under such statute, should Mortgagee elect to seek such relief thereunder. SECTION 9.03 Foreclosure, Power of Sale. Mortgagor hereby grants power to Mortgagee, in the event of the occurrence of an Event of Default hereunder, to grant, bargain, sell, release and convey the Mortgaged Property at public auction or vendue, and upon such sale to execute and deliver to the purchaser(s) instruments of conveyance pursuant to the terms hereof 31 and to the applicable laws. Mortgagor acknowledges that the foregoing sentence confers a power of sale upon Mortgagee, and that upon default this Mortgage may be foreclosed by advertisement as described below and in the applicable Michigan statutes. Mortgagor understands that upon default, Mortgagee is hereby authorized and empowered to sell the Mortgaged Property, or cause the same to be sold and to convey the same to the purchaser in any lawful manner, including but not limited to that provided by Chapter 32 of the Revised Judicature Act of Michigan, entitled "Foreclosure of Mortgages by Advertisement", which permits Mortgagee to sell the Mortgaged Property without affording Mortgagor a hearing, or giving him actual personal notice. The only notice required under such Chapter 32 is to publish notice in a local newspaper and to post a copy of the notice on the Mortgaged Property. WARNING: THIS MORTGAGE CONTAINS A POWER OF SALE AND UPON A MATURITY EVENT OF DEFAULT MAY BE FORECLOSED BY ADVERTISEMENT. IN FORECLOSURE BY ADVERTISEMENT, NO HEARING IS INVOLVED AND THE ONLY NOTICE REQUIRED IS TO BE PUBLISHED NOTICE IN A LOCAL NEWSPAPER AND TO POST A COPY OF THE NOTICE ON THE PROPERTY. WAIVER: IF THIS MORTGAGE IS FORECLOSED BY ADVERTISEMENT, MORTGAGOR HEREBY VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY WAIVES ALL RIGHTS, UNDER THE CONSTITUTION AND LAWS OF THE STATE OF MICHIGAN AND THE CONSTITUTION AND LAWS OF THE UNITED STATES, TO ALL NOTICE AND A HEARING IN CONNECTION WITH THE ABOVE MENTIONED FORECLOSURE BY ADVERTISEMENT, EXCEPT AS SET FORTH IN THE MICHIGAN STATUTE PROVIDING FOR FORECLOSURE BY ADVERTISEMENT. SECTION 9.04 Fixture Financing Statement. For purposes of Article Nine of the Michigan Uniform Commercial Code, (a) Mortgagor herein is the "debtor", (b) debtor's federal tax identification number is 38-3457667, (c) Mortgagee herein is the "secured party", (d) information concerning the security interest created hereby may be obtained from Mortgagee at its address set forth on page 1 hereof, and (e) Mortgagor's mailing address is that set forth on page 1 hereof. SECTION 9.05 Assignment of Rents. As additional security for the payment of the indebtedness evidenced by the Promissory Note, including interest thereon, and the performance of all of Mortgagor's obligations hereunder or secured hereby, and under any other document executed simultaneously or in connection herewith, Mortgagor does hereby sell, assign, transfer and set over unto Mortgagee, pursuant to Act 210 of the Public Acts of Michigan of 1953, as amended, all the rents, profits and income under all leases or occupancy agreements or arrangements, however evidenced or denominated, upon or affecting the Mortgaged Property (including any extensions, amendments or renewals thereof), whether such rents, profits and income are due or are to become due, including all such leases in existence or coming into existence during the period this Mortgage is in effect. This assignment shall run with the land and be good and valid as against Mortgagor and those claiming by, under or through Mortgagor, from the date of recording of this Mortgage. This assignment shall continue to be operative during the foreclosure or any other proceedings taken to enforce this Mortgage. In the event of a foreclosure sale which results in a deficiency, this assignment shall stand as security during the redemption period for the payment of such deficiency. This assignment is given as collateral 32 security only and does not and shall not be construed as obligating Mortgagee to perform any of the covenants or undertakings required to be performed by Mortgagor in any leases. Mortgagee and its duly authorized agents shall be entitled to enter the Mortgaged Property for the purpose of delivering any and all such notices and other communications to the tenants and occupiers thereof as shall be necessary or desirable in Mortgagee's discretion to exercise its rights hereunder, and Mortgagee and its agents shall have absolutely no liability to Mortgagor arising therefrom. Mortgagee shall not, however, be obligated to give any tenant or occupier of the Mortgaged Property any notice by personal delivery and Mortgagee may, in its sole discretion, deliver all such notices and communications by ordinary first-class U.S. mail, postage prepaid, or otherwise. In the event that Mortgagor obstructs Mortgagee in its efforts to collect the rents and income from the Mortgaged Property, or after requested by Mortgagee, unreasonably refuses, fails or neglects to assist Mortgagee in collecting such rent and income, Mortgagee shall be entitled to the appointment of a receiver of the Mortgaged Property and of the income, rents and profits therefrom, with such powers as the court making such appointment may confer. Mortgagee shall at no time have any obligation whatever to attempt to collect rent from any tenant or occupier of the Mortgage Property notwithstanding that such tenants and occupiers may not be paying rent to either Mortgagor or to Mortgagee. Further, Mortgagee shall at no time have any obligation whatever to enforce any other obligations owed by tenants or occupiers of the Mortgage Property to Mortgagor. No action taken by Mortgagee under this Mortgage shall put Mortgagee in the position of a "mortgagee in possession." The provisions of this Section are not intended to evidence an additional recordable event, as may be prohibited by Act 459 of the Public Acts of Michigan of 1996, but rather are included in this Mortgage for purposes of complying with any applicable requirements of Act 210 of the Public Acts of Michigan of 1953, as amended. SECTION 9.06 Future Advances. Upon request of Mortgagor, Mortgagee, at Mortgagee's option, so long as Mortgagor is not in default hereunder, and this Mortgage secures obligations held by Mortgagee, may make Future Advances to Mortgagor. Such Future Advances, with interest thereon, shall be secured by this Mortgage. In such event, this Mortgage shall be a "Future Advance Mortgage" under Public Act 348 or Public Acts of 1990 (MCLA 565.901-906). All future advances under the Promissory Note or this Mortgage shall have the same priority as if the future advance was made on the date that this Mortgage was recorded. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of 33 any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 34 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: MILACRON INDUSTRIAL PRODUCTS, INC., a Michigan corporation By: /s/ R.P. Lienesch ------------------ Name: R.P. Lienesch Title: Treasurer ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 8, 2004, before me the undersigned personally appeared R.P. Lienesch the duly authorized Treasurer of Milacron Industrial Products, Inc., personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/ their capacity (ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ Jean Moyer -------------- (signature and office of individual taking acknowledgment) Name of Notary public (exactly as it appears on the notary's appointment): Jean Moyer Notary Public, State of Ohio, County of Hamilton. My Commission Expires: June 11, 2007 Acting in the County of: Hamilton THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Jonathan P. Baumstark, Esq. Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Ref. No.: 030786-0117 EXHIBIT A LEGAL DESCRIPTION Address: 31003 Industrial Road Livonia, Michigan 48150 County: Wayne County Property Tax ID No.: ____________________ A-1 EX-4.15 58 y98028exv4w15.txt MORTGAGE Exhibit 4.15 MORTGAGE made by D-M-E U.S.A. INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 29111 Stephenson Highway Madison Heights, Michigan 48071 Oakland County DATED AS OF JUNE 10, 2004 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above................................................................... 2 SECTION 1.02 Definitions........................................................................... 2 SECTION 1.03 Terminology........................................................................... 6 SECTION 1.04 Other Defined Terms................................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien......................................................................... 6 SECTION 2.02 Grant of Security Interest............................................................ 7 SECTION 2.03 No Obligation of Mortgagee............................................................ 7 SECTION 2.04 Fixture Filing........................................................................ 7 SECTION 2.05 Future Advances....................................................................... 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment............................................................................ 8 SECTION 3.02 Revocable License..................................................................... 8 SECTION 3.03 Enforcement of Leases................................................................. 9 SECTION 3.04 Direction to Tenants.................................................................. 9 SECTION 3.05 Appointment of Attorney-in-Fact....................................................... 9 SECTION 3.06 No Liability of Mortgagee............................................................. 10 SECTION 3.07 Mortgagor's Indemnities............................................................... 10 SECTION 3.08 No Modification of Mortgagor's Obligations............................................ 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage................................. 11 SECTION 4.02 Taxes and Other Payments.............................................................. 11 SECTION 4.03 Power to Create Lien and Security..................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture........................................... 12 SECTION 4.05 Compliance with Laws.................................................................. 12 SECTION 4.06 No Condemnation....................................................................... 12 SECTION 4.07 Flood Zone............................................................................ 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status........................................................................... 13 SECTION 5.02 Payment of Impositions................................................................ 13 SECTION 5.03 Repair................................................................................ 14 SECTION 5.04 Insurance and Application of Insurance Proceeds....................................... 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds................................. 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights.................... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............................ 17 SECTION 5.08 Compliance with Permitted Liens and Other Obligations................................. 17 SECTION 5.09 Additional Affirmative Covenants...................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18 SECTION 6.01 Use Violations........................................................................ 18
i SECTION 6.02 Waste................................................................................. 18 SECTION 6.03 Alterations........................................................................... 18 SECTION 6.04 No Further Encumbrances............................................................... 18 SECTION 6.05 Transfer Restrictions................................................................. 18 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............ 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default...................................................................... 19 SECTION 7.02 Acceleration.......................................................................... 19 SECTION 7.03 Foreclosure and Sale.................................................................. 19 SECTION 7.04 Mortgagee's Agents.................................................................... 20 SECTION 7.05 Judicial Foreclosure.................................................................. 20 SECTION 7.06 Receiver.............................................................................. 21 SECTION 7.07 Foreclosure for Installments.......................................................... 21 SECTION 7.08 Separate Sales........................................................................ 21 SECTION 7.09 Possession of Mortgaged Property...................................................... 21 SECTION 7.10 Occupancy After Acceleration.......................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive...................................... 22 SECTION 7.12 No Release of Senior Secured Note Obligations......................................... 22 SECTION 7.13 Release of and Resort to Collateral................................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................................ 23 SECTION 7.15 Discontinuance of Proceedings......................................................... 23 SECTION 7.16 Application of Proceeds............................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies...................................................... 24 SECTION 7.18 Indemnity............................................................................. 24 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc................................................. 25 SECTION 8.02 Performance at Mortgagor's Expense.................................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations........................................... 25 SECTION 8.04 Further Assurances.................................................................... 25 SECTION 8.05 Notices............................................................................... 26 SECTION 8.06 No Waiver............................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures.............................. 26 SECTION 8.08 Successors and Assigns................................................................ 27 SECTION 8.09 Severability.......................................................................... 27 SECTION 8.10 Entire Agreement and Modification..................................................... 27 SECTION 8.11 Applicable Law........................................................................ 27 SECTION 8.12 Satisfaction of Prior Encumbrance..................................................... 28 SECTION 8.13 No Partnership........................................................................ 28 SECTION 8.14 Headings.............................................................................. 28 SECTION 8.15 Release of Mortgage................................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property...... 28 SECTION 8.17 Inconsistency With Indenture.......................................................... 29 SECTION 8.18 Limitation on Interest Payable........................................................ 29

ii SECTION 8.19 Covenants To Run With the Land........................................................ 29 SECTION 8.20 Intentionally omitted................................................................. 30 SECTION 8.21 Defense of Claims..................................................................... 30 SECTION 8.22 Exculpation Provisions................................................................ 30 SECTION 8.23 No Merger of Estates.................................................................. 30 SECTION 8.24 Release Upon Transfer or Sale......................................................... 31 SECTION 8.25 Counterparts.......................................................................... 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS.................................................................. 31 SECTION 9.01 Divisions............................................................................. 31 SECTION 9.02 Waste................................................................................. 31 SECTION 9.03 Foreclosure, Power of Sale............................................................ 31 SECTION 9.04 Fixture Financing Statement........................................................... 32 SECTION 9.05 Assignment of Rents................................................................... 32 SECTION 9.06 Future Advances....................................................................... 33 ARTICLE X INTERCREDITOR.......................................................................................... 33

EXHIBIT A - LEGAL DESCRIPTION iii MORTGAGE THIS MORTGAGE, (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E U.S.A. INC., a Michigan corporation, an office at 29111 Stephenson Highway, Madison Heights, MI 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee). R E C I T A L S: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively the "Obligors"), and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, an Federal, state, city town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the Senior Secured Note Obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas 3 and other substances of any kind or character on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, WARRANTS, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, WARRANT, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E U.S.A. Inc. Type of Organization: Corporation State: Michigan FEIN: 38-1577946 Organizational ID Number: 122-159 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. It is the intention of Mortgagor and Mortgagee that this Mortgage (as renewed and extended from time to time) shall secure future advances and readavances, and the lien and security interest created by this Mortgage shall attach upon 7 execution and have priority from the time of recording as to all advances, whether obligatory or discretionary, until this Mortgage is released of record. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the 8 terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, 9 and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or Indemnified Party hereunder, or by reason or in 10 defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any of the other Holders or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the 11 payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. 12 SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to 13 cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure 14 piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. 15 (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. 16 (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall 17 comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any 18 interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Borrowers or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or 19 things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. 20 SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of 21 Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to 22 comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Borrower, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors, Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. 23 SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree 24 to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, 25 including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the 26 Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. 27 SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) 28 ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency With Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of 29 Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. 30 SECTION 8.24 Release Upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Divisions. The Property secured by the Mortgage includes all rights to make all divisions under section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967, as amended. The Mortgagor shall not split, divide, subdivide or otherwise create separate parcels of the Property. SECTION 9.02 Waste. Mortgagor's failure to pay taxes and/or assessments assessed against the Mortgaged Property, or any installment thereof, or any insurance premium upon policies covering the Mortgaged Property or any part thereof, shall constitute waste (although the meaning of the term "waste" shall not necessarily be limited to such nonpayment), as provided by Act No. 236 of the Public Acts of Michigan of 1961, as amended, and shall entitle Mortgagee to all remedies provided for therein. Mortgagor further agrees to and does hereby consent to the appointment of a receiver under such statute, should Mortgagee elect to seek such relief thereunder. SECTION 9.03 Foreclosure, Power of Sale. Mortgagor hereby grants power to Mortgagee, in the event of the occurrence of an Event of Default hereunder, to grant, bargain, sell, release and convey the Mortgaged Property at public auction or vendue, and upon such sale to execute and deliver to the purchaser(s) instruments of conveyance pursuant to the terms hereof and to the applicable laws. Mortgagor acknowledges that the foregoing sentence confers a power of sale upon Mortgagee, and that upon default this Mortgage may be foreclosed by 31 advertisement as described below and in the applicable Michigan statutes. Mortgagor understands that upon default, Mortgagee is hereby authorized and empowered to sell the Mortgaged Property, or cause the same to be sold and to convey the same to the purchaser in any lawful manner, including but not limited to that provided by Chapter 32 of the Revised Judicature Act of Michigan, entitled "Foreclosure of Mortgages by Advertisement", which permits Mortgagee to sell the Mortgaged Property without affording Mortgagor a hearing, or giving him actual personal notice. The only notice required under such Chapter 32 is to publish notice in a local newspaper and to post a copy of the notice on the Mortgaged Property. WARNING: THIS MORTGAGE CONTAINS A POWER OF SALE AND UPON A MATURITY EVENT OF DEFAULT MAY BE FORECLOSED BY ADVERTISEMENT. IN FORECLOSURE BY ADVERTISEMENT, NO HEARING IS INVOLVED AND THE ONLY NOTICE REQUIRED IS TO BE PUBLISHED NOTICE IN A LOCAL NEWSPAPER AND TO POST A COPY OF THE NOTICE ON THE PROPERTY. WAIVER: IF THIS MORTGAGE IS FORECLOSED BY ADVERTISEMENT, MORTGAGOR HEREBY VOLUNTARILY, INTELLIGENTLY AND KNOWINGLY WAIVES ALL RIGHTS, UNDER THE CONSTITUTION AND LAWS OF THE STATE OF MICHIGAN AND THE CONSTITUTION AND LAWS OF THE UNITED STATES, TO ALL NOTICE AND A HEARING IN CONNECTION WITH THE ABOVE MENTIONED FORECLOSURE BY ADVERTISEMENT, EXCEPT AS SET FORTH IN THE MICHIGAN STATUTE PROVIDING FOR FORECLOSURE BY ADVERTISEMENT. SECTION 9.04 Fixture Financing Statement. For purposes of Article Nine of the Michigan Uniform Commercial Code, (a) Mortgagor herein is the "debtor", (b) debtor's federal tax identification number is 38-1577946, (c) Mortgagee herein is the "secured party", (d) information concerning the security interest created hereby may be obtained from Mortgagee at its address set forth on page 1 hereof, and (e) Mortgagor's mailing address is that set forth on page 1 hereof. SECTION 9.05 Assignment of Rents. As additional security for the payment of the indebtedness evidenced by the Promissory Note, including interest thereon, and the performance of all of Mortgagor's obligations hereunder or secured hereby, and under any other document executed simultaneously or in connection herewith, Mortgagor does hereby sell, assign, transfer and set over unto Mortgagee, pursuant to Act 210 of the Public Acts of Michigan of 1953, as amended, all the rents, profits and income under all leases or occupancy agreements or arrangements, however evidenced or denominated, upon or affecting the Mortgaged Property (including any extensions, amendments or renewals thereof), whether such rents, profits and income are due or are to become due, including all such leases in existence or coming into existence during the period this Mortgage is in effect. This assignment shall run with the land and be good and valid as against Mortgagor and those claiming by, under or through Mortgagor, from the date of recording of this Mortgage. This assignment shall continue to be operative during the foreclosure or any other proceedings taken to enforce this Mortgage. In the event of a foreclosure sale which results in a deficiency, this assignment shall stand as security during the redemption period for the payment of such deficiency. This assignment is given as collateral security only and does not and shall not be construed as obligating Mortgagee to perform any of the covenants or undertakings required to be performed by Mortgagor in any leases. 32 Mortgagee and its duly authorized agents shall be entitled to enter the Mortgaged Property for the purpose of delivering any and all such notices and other communications to the tenants and occupiers thereof as shall be necessary or desirable in Mortgagee's discretion to exercise its rights hereunder, and Mortgagee and its agents shall have absolutely no liability to Mortgagor arising therefrom. Mortgagee shall not, however, be obligated to give any tenant or occupier of the Mortgaged Property any notice by personal delivery and Mortgagee may, in its sole discretion, deliver all such notices and communications by ordinary first-class U. S. mail, postage prepaid, or otherwise. In the event that Mortgagor obstructs Mortgagee in its efforts to collect the rents and income from the Mortgaged Property, or after requested by Mortgagee, unreasonably refuses, fails or neglects to assist Mortgagee in collecting such rent and income, Mortgagee shall be entitled to the appointment of a receiver of the Mortgaged Property and of the income, rents and profits therefrom, with such powers as the court making such appointment may confer. Mortgagee shall at no time have any obligation whatever to attempt to collect rent from any tenant or occupier of the Mortgage Property notwithstanding that such tenants and occupiers may not be paying rent to either Mortgagor or to Mortgagee. Further, Mortgagee shall at no time have any obligation whatever to enforce any other obligations owed by tenants or occupiers of the Mortgage Property to Mortgagor. No action taken by Mortgagee under this Mortgage shall put Mortgagee in the position of a "mortgagee in possession." The provisions of this Section are not intended to evidence an additional recordable event, as may be prohibited by Act 459 of the Public Acts of Michigan of 1996, but rather are included in this Mortgage for purposes of complying with any applicable requirements of Act 210 of the Public Acts of Michigan of 1953, as amended. SECTION 9.06 Future Advances. Upon request of Mortgagor, Mortgagee, at Mortgagee's option, so long as Mortgagor is not in default hereunder, and this Mortgage secures obligations held by Mortgagee, may make Future Advances to Mortgagor. Such Future Advances, with interest thereon, shall be secured by this Mortgage. In such event, this Mortgage shall be a "Future Advance Mortgage" under Public Act 348 or Public Acts of 1990 (MCLA 565.901-906). All future advances under the Promissory Note or this Mortgage shall have the same priority as if the future advance was made on the date that this Mortgage was recorded. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 33 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E U.S.A. Inc., a Michigan corporation By: /s/ R.P. Lienesch ---------------------- Name: R.P. Lienesch Title: Treasurer ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 8, 2004, before me the undersigned personally appeared R.P. Lienesch the duly authorized Treasurer of D-M-E U.S.A. Inc., personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/ their capacity (ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ Jean Moyer ------------------------------------ (signature and office of individual taking acknowledgment) Name of Notary public (exactly as it appears on the notary's appointment): Jean Moyer Notary Public, State of Ohio, County of Hamilton. My Commission Expires: June 11, 2007 Acting in the County of: Hamilton THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Jonathan P. Baumstark, Esq. Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Ref. No.: 030786-0117 EXHIBIT A LEGAL DESCRIPTION Address: 29111 Stephenson Highway Madison Heights, Michigan 48071 County: Oakland Property Tax ID No.: ____________________ A-1 EX-4.16 59 y98028exv4w16.txt OPEN-END MORTGAGE Exhibit 4.16 OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING made by D-M-E COMPANY (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 558 Leo Street Dayton, Ohio 45404 Montgomery County DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Attention: Jonathan P. Baumstark, Esq. Ref. No.: 030786-0117 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above................................................................... 2 SECTION 1.02 Definitions........................................................................... 2 SECTION 1.03 Terminology........................................................................... 6 SECTION 1.04 Other Defined Terms................................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien......................................................................... 6 SECTION 2.02 Grant of Security Interest............................................................ 7 SECTION 2.03 No Obligation of Mortgagee............................................................ 7 SECTION 2.04 Fixture Filing........................................................................ 7 SECTION 2.05 Future Advances....................................................................... 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment............................................................................ 8 SECTION 3.02 Revocable License..................................................................... 8 SECTION 3.03 Enforcement of Leases................................................................. 9 SECTION 3.04 Direction to Tenants.................................................................. 9 SECTION 3.05 Appointment of Attorney-in-Fact....................................................... 10 SECTION 3.06 No Liability of Mortgagee............................................................. 10 SECTION 3.07 Mortgagor's Indemnities............................................................... 11 SECTION 3.08 No Modification of Mortgagor's Obligations............................................ 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage................................. 12 SECTION 4.02 Taxes and Other Payments.............................................................. 12 SECTION 4.03 Power to Create Lien and Security..................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture........................................... 12 SECTION 4.05 Compliance with Laws.................................................................. 12 SECTION 4.06 No Condemnation....................................................................... 13 SECTION 4.07 Flood Zone............................................................................ 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status........................................................................... 13 SECTION 5.02 Payment of Impositions................................................................ 13 SECTION 5.03 Repair................................................................................ 14 SECTION 5.04 Insurance and Application of Insurance Proceeds....................................... 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds................................. 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights.................... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............................ 18 SECTION 5.08 Compliance with Permitted Liens and Other Obligations................................. 18 SECTION 5.09 Additional Affirmative Covenants...................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18 SECTION 6.01 Use Violations........................................................................ 18
i SECTION 6.02 Waste................................................................................. 18 SECTION 6.03 Alterations........................................................................... 18 SECTION 6.04 No Further Encumbrances............................................................... 19 SECTION 6.05 Transfer Restrictions................................................................. 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............ 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default...................................................................... 19 SECTION 7.02 Acceleration.......................................................................... 19 SECTION 7.03 Foreclosure and Sale.................................................................. 19 SECTION 7.04 Mortgagee's Agents.................................................................... 20 SECTION 7.05 Judicial Foreclosure.................................................................. 21 SECTION 7.06 Receiver.............................................................................. 21 SECTION 7.07 Foreclosure for Installments.......................................................... 21 SECTION 7.08 Separate Sales........................................................................ 21 SECTION 7.09 Possession of Mortgaged Property...................................................... 22 SECTION 7.10 Occupancy After Acceleration.......................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive...................................... 22 SECTION 7.12 No Release of Senior Secured Note Obligations......................................... 23 SECTION 7.13 Release of and Resort to Collateral................................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................................ 23 SECTION 7.15 Discontinuance of Proceedings......................................................... 24 SECTION 7.16 Application of Proceeds............................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies...................................................... 24 SECTION 7.18 Indemnity............................................................................. 25 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc................................................. 25 SECTION 8.02 Performance at Mortgagor's Expense.................................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations........................................... 26 SECTION 8.04 Further Assurances.................................................................... 26 SECTION 8.05 Notices............................................................................... 26 SECTION 8.06 No Waiver............................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures.............................. 26 SECTION 8.08 Successors and Assigns................................................................ 27 SECTION 8.09 Severability.......................................................................... 27 SECTION 8.10 Entire Agreement and Modification..................................................... 27 SECTION 8.11 Applicable Law........................................................................ 27 SECTION 8.12 Satisfaction of Prior Encumbrance..................................................... 28 SECTION 8.13 No Partnership........................................................................ 28 SECTION 8.14 Headings.............................................................................. 28 SECTION 8.15 Release of Mortgage................................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property...... 28 SECTION 8.17 Inconsistency with Indenture.......................................................... 29 SECTION 8.18 Limitation on Interest Payable........................................................ 29 SECTION 8.19 Covenants To Run With the Land........................................................ 30

ii SECTION 8.20 Intentionally omitted................................................................. 30 SECTION 8.21 Defense of Claims..................................................................... 30 SECTION 8.22 Exculpation Provisions................................................................ 30 SECTION 8.23 No Merger of Estates.................................................................. 31 SECTION 8.24 Release upon Transfer or Sale......................................................... 31 SECTION 8.25 Counterparts.......................................................................... 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS.................................................................. 31 SECTION 9.01 Additional State-Specific Provisions.................................................. 31 ARTICLE X INTERCREDITOR.......................................................................................... 31

EXHIBIT A - LEGAL DESCRIPTION iii OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E COMPANY, a Delaware corporation, having an office at 29111 Stephenson Highway, Madison Heights, Michigan 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). R E C I T A L S: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. (the "Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively, the "Obligors"), and Mortgagee, in its capacity as Trustee are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes") WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Note for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, an Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E Company Type of Organization: Corporation State: Delaware FEIN: 31-1453086 Organizational ID Number: 2580409 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. This Mortgage will secure unpaid balances of any future loan advances, whether obligatory or not, made by Mortgagee after this Mortgage is delivered for record to the extent that the total unpaid Senior Secured Note Obligations and 7 advances made pursuant to designated lines of credit, exclusive of interest thereon, collection costs, and expenses incurred by Mortgagee by reason of any default of Mortgagor under the terms hereof, does not exceed the maximum amount of unpaid indebtedness which may be outstanding at any time, which is $225,000,000, provided that this Mortgage will also secure unpaid balances of advances made for the payment of taxes, assessments, insurance or expenses incurred for the protection of the Mortgaged Property. Any and all future advances under this Mortgage and the Senior Secured Note Documents shall have the same priority as if the future advance was made on that date this Mortgage was recorded. It is agreed that the lien hereby created will take precedence over and be a prior lien to any other lien of any character whether vendor's, materialmen's or mechanic's lien hereafter created on the Mortgaged Property, and in the event the proceeds of the Loan are used to pay off and satisfy any liens existing on the Mortgaged Property, then Mortgagee is, and will be, subrogated to all of the rights, liens and remedies of the holders of the indebtedness so paid. This Mortgage is given to secure repayment of advances made pursuant to the Indenture which advances are obligatory. Mortgagor agrees that the loans secured by this Mortgage may be paid out by Mortgagee as provided in the Indenture, or any amendment thereto, and Mortgagee may do all things as provided to be done by Mortgagee thereunder. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor 8 hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall 9 have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall 10 be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or such Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all 12 applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on 13 which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed 14 Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. 15 (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. 16 (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning 17 ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parentor Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. 18 SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed 19 in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by 20 Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. 21 SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be 22 deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be 23 repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. 24 SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. 25 SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. 26 (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; 27 PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTE AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in 28 its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or 29 Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE 30 PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Additional State-Specific Provisions. Intentionally omitted. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. 31 [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 32 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E COMPANY, a Delaware corporation By: /s/ R.P. Lienesch ---------------------- Name: R.P. Lienesch Title: Vice President ACKNOWLEDGEMENT STATE OF OHIO ) ) SS: COUNTY OF HAMILTON ) Executed and acknowledged before me on the 8th day of June, 2004, by R.P. Lienesch, the duly authorized Vice President of D-M-E Company, the Mortgagor in the foregoing Mortgage, who represented to me to be said person. IN TESTIMONY WHEREOF, I have hereunto subscribed by name and affixed my notarial seal on the day and year last aforesaid. /s/ Jean Moyer ------------------ Notary Public My commission expires: June 11, 2007 EXHIBIT A LEGAL DESCRIPTION Auditor's Parcel No.:__________________________________________________ A-1 EX-4.17 60 y98028exv4w17.txt OPEN-END MORTGAGE Exhibit 4.17 OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING made by MILACRON INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 418 West Main Street Mount Orab, Ohio 45154 Brown County DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Attention: Jonathan P. Baumstark, Esq. Ref. No.: 030786-0117 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above........................................................................ 2 SECTION 1.02 Definitions................................................................................ 2 SECTION 1.03 Terminology................................................................................ 6 SECTION 1.04 Other Defined Terms........................................................................ 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien.............................................................................. 6 SECTION 2.02 Grant of Security Interest................................................................. 7 SECTION 2.03 No Obligation of Mortgagee................................................................. 7 SECTION 2.04 Fixture Filing............................................................................. 7 SECTION 2.05 Future Advances............................................................................ 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment................................................................................. 8 SECTION 3.02 Revocable License.......................................................................... 8 SECTION 3.03 Enforcement of Leases...................................................................... 9 SECTION 3.04 Direction to Tenants....................................................................... 9 SECTION 3.05 Appointment of Attorney-in-Fact............................................................ 10 SECTION 3.06 No Liability of Mortgagee.................................................................. 10 SECTION 3.07 Mortgagor's Indemnities.................................................................... 11 SECTION 3.08 No Modification of Mortgagor's Senior Secured Note Obligations............................. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage...................................... 12 SECTION 4.02 Taxes and Other Payments................................................................... 12 SECTION 4.03 Power to Create Lien and Security.......................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture................................................ 12 SECTION 4.05 Compliance with Laws....................................................................... 12 SECTION 4.06 No Condemnation............................................................................ 13 SECTION 4.07 Flood Zone................................................................................. 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status................................................................................ 13 SECTION 5.02 Payment of Impositions..................................................................... 13 SECTION 5.03 Repair..................................................................................... 14 SECTION 5.04 Insurance and Application of Insurance Proceeds............................................ 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds...................................... 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights......................... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations................................. 18 SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations.................. 18 SECTION 5.09 Additional Affirmative Covenants........................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18 SECTION 6.01 Use Violations............................................................................. 18 SECTION 6.02 Waste...................................................................................... 18 SECTION 6.03 Alterations................................................................................ 18 SECTION 6.04 No Further Encumbrances.................................................................... 19
i SECTION 6.05 Transfer Restrictions...................................................................... 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants................. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default........................................................................... 19 SECTION 7.03 Foreclosure and Sale....................................................................... 19 SECTION 7.04 Mortgagee's Agents......................................................................... 21 SECTION 7.05 Judicial Foreclosure....................................................................... 21 SECTION 7.06 Receiver................................................................................... 21 SECTION 7.07 Foreclosure for Installments............................................................... 21 SECTION 7.08 Separate Sales............................................................................. 22 SECTION 7.09 Possession of Mortgaged Property........................................................... 22 SECTION 7.10 Occupancy After Acceleration............................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive........................................... 22 SECTION 7.12 No Release of Senior Secured Note Obligations.............................................. 23 SECTION 7.13 Release of and Resort to Collateral........................................................ 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets..................................... 23 SECTION 7.15 Discontinuance of Proceedings.............................................................. 24 SECTION 7.16 Application of Proceeds.................................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies........................................................... 24 SECTION 7.18 Indemnity.................................................................................. 25 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc...................................................... 25 SECTION 8.02 Performance at Mortgagor's Expense......................................................... 26 SECTION 8.03 Survival of Senior Secured Note Obligations................................................ 26 SECTION 8.04 Further Assurances......................................................................... 26 SECTION 8.05 Notices.................................................................................... 26 SECTION 8.06 No Waiver.................................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures................................... 27 SECTION 8.08 Successors and Assigns..................................................................... 27 SECTION 8.09 Severability............................................................................... 27 SECTION 8.10 Entire Agreement and Modification.......................................................... 28 SECTION 8.11 Applicable Law............................................................................. 28 SECTION 8.12 Satisfaction of Prior Encumbrance.......................................................... 28 SECTION 8.13 No Partnership............................................................................. 28 SECTION 8.14 Headings................................................................................... 28 SECTION 8.15 Release of Mortgage........................................................................ 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property........... 29 SECTION 8.17 Inconsistency with Indenture............................................................... 29 SECTION 8.18 Limitation on Interest Payable............................................................. 29 SECTION 8.19 Covenants To Run With the Land............................................................. 30 SECTION 8.20 Intentionally omitted...................................................................... 30 SECTION 8.21 Defense of Claims.......................................................................... 30 SECTION 8.22 Exculpation Provisions..................................................................... 30 SECTION 8.23 No Merger of Estates....................................................................... 31 SECTION 8.24 Release upon Transfer or Sale.............................................................. 31 SECTION 8.25 Counterparts............................................................................... 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS.................................................................. 32

ii ~~SECTION 9.01 Additional State-Specific Provisions....................................................... 32~~

EXHIBIT A - LEGAL DESCRIPTION iii OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by MILACRON INC., a Delaware corporation, with an address at 2090 Florence Avenue, Cincinnati, Ohio 45206, ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, with an address at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). R E C I T A L S: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Mortgagor and the Guarantors (as hereinafter defined; and together with Mortgagor, each an "Obligor" and collectively, the "Obligors") and Mortgagee, in its capacity as Trustee, are parties to that certain indenture dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Mortgagor has issued the Notes to the Holders; WHEREAS, Mortgagor derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Mortgagor from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: Milacron Inc. Type of Organization: Corporation State: Delaware FEIN: 31-1062125 Organizational ID Number: 2005100 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. This Mortgage will secure unpaid balances of any future loan advances, whether obligatory or not, made by Mortgagee after this Mortgage is delivered for record to the extent that the total unpaid Senior Secured Note Obligations and 7 advances made pursuant to designated lines of credit, exclusive of interest thereon, collection costs, and expenses incurred by Mortgagee by reason of any default of Mortgagor under the terms hereof, does not exceed the maximum amount of unpaid indebtedness which may be outstanding at any time, which is $225,000,000, provided that this Mortgage will also secure unpaid balances of advances made for the payment of taxes, assessments, insurance or expenses incurred for the protection of the Mortgaged Property. Any and all future advances under this Mortgage and the Senior Secured Note Documents shall have the same priority as if the future advance was made on that date this Mortgage was recorded. It is agreed that the lien hereby created will take precedence over and be a prior lien to any other lien of any character whether vendor's, materialmen's or mechanic's lien hereafter created on the Mortgaged Property, and in the event the proceeds of the Loan are used to pay off and satisfy any liens existing on the Mortgaged Property, then Mortgagee is, and will be, subrogated to all of the rights, liens and remedies of the holders of the indebtedness so paid. This Mortgage is given to secure repayment of advances made pursuant to the Indenture which advances are obligatory. Mortgagor agrees that the loans secured by this Mortgage may be paid out by Mortgagee as provided in the Indenture, or any amendment thereto, and Mortgagee may do all things as provided to be done by Mortgagee thereunder. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor 8 hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall 9 have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall 10 be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or such Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable to be filed by Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all 12 applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on 13 which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed 14 Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. 15 (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. 16 (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning 17 ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations. Mortgagor shall comply in all material respects with any and all Senior Secured Note Obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Mortgagor or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly 18 provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Obligors or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be 19 required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies 20 provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. 21 SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other 22 right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or 23 under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee 24 may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. 25 SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. 27 SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, 28 such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note 29 Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE 30 TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Agreement shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Agreement in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Additional State-Specific Provisions. Intentionally omitted. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 32 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: MILACRON INC., a Delaware corporation By: /s/ R.P. Lienesch ----------------------------------- Name: R.P. Lienesch Title: Vice President - Finance and Chief Financial Officer ACKNOWLEDGEMENT STATE OF OHIO ) ) SS: COUNTY OF HAMILTON ) Executed and acknowledged before me on the 8th day of June, 2004, by R.P. Lienesch, the duly authorized VP Finance and CFO of Milacron Inc., the Mortgagor in the foregoing Mortgage, who represented to me to be said person. IN TESTIMONY WHEREOF, I have hereunto subscribed by name and affixed my notarial seal on the day and year last aforesaid. /s/ Jean Moyer -------------------------------------- Notary Public My commission expires: June 11, 2007 EXHIBIT A LEGAL DESCRIPTION Auditor's Parcel No.:______________________________________________ A-1 EX-4.18 61 y98028exv4w18.txt OPEN-END MORTGAGE Exhibit 4.18 OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING made by MILACRON INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 3000 Disney Street Cincinnati, Ohio 45209 Hamilton County DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Attention: Jonathan P. Baumstark, Esq. Ref. No.: 030786-0117 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above................................................................... 2 SECTION 1.02 Definitions........................................................................... 2 SECTION 1.03 Terminology........................................................................... 6 SECTION 1.04 Other Defined Terms................................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien......................................................................... 6 SECTION 2.02 Grant of Security Interest............................................................ 7 SECTION 2.03 No Obligation of Mortgagee............................................................ 7 SECTION 2.04 Fixture Filing........................................................................ 7 SECTION 2.05 Future Advances....................................................................... 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment............................................................................ 8 SECTION 3.02 Revocable License..................................................................... 8 SECTION 3.03 Enforcement of Leases................................................................. 9 SECTION 3.04 Direction to Tenants.................................................................. 9 SECTION 3.05 Appointment of Attorney-in-Fact....................................................... 10 SECTION 3.06 No Liability of Mortgagee............................................................. 10 SECTION 3.07 Mortgagor's Indemnities............................................................... 11 SECTION 3.08 No Modification of Mortgagor's Obligations............................................ 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage................................. 12 SECTION 4.02 Taxes and Other Payments.............................................................. 12 SECTION 4.03 Power to Create Lien and Security..................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture........................................... 12 SECTION 4.05 Compliance with Laws.................................................................. 12 SECTION 4.06 No Condemnation....................................................................... 13 SECTION 4.07 Flood Zone............................................................................ 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status........................................................................... 13 SECTION 5.02 Payment of Impositions................................................................ 13 SECTION 5.03 Repair................................................................................ 14 SECTION 5.04 Insurance and Application of Insurance Proceeds....................................... 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds................................. 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights.................... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............................ 18 SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations........................................................................... 18 SECTION 5.09 Additional Affirmative Covenants...................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18
i SECTION 6.01 Use Violations........................................................................ 18 SECTION 6.02 Waste................................................................................. 18 SECTION 6.03 Alterations........................................................................... 18 SECTION 6.04 No Further Encumbrances............................................................... 19 SECTION 6.05 Transfer Restrictions................................................................. 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............................................................................. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default...................................................................... 19 SECTION 7.02 Acceleration.......................................................................... 19 SECTION 7.03 Foreclosure and Sale.................................................................. 19 SECTION 7.04 Mortgagee's Agents.................................................................... 20 SECTION 7.05 Judicial Foreclosure.................................................................. 21 SECTION 7.06 Receiver.............................................................................. 21 SECTION 7.07 Foreclosure for Installments.......................................................... 21 SECTION 7.08 Separate Sales........................................................................ 21 SECTION 7.09 Possession of Mortgaged Property...................................................... 22 SECTION 7.10 Occupancy After Acceleration.......................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive...................................... 22 SECTION 7.12 No Release of Senior Secured Note Obligations......................................... 23 SECTION 7.13 Release of and Resort to Collateral................................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................................ 23 SECTION 7.15 Discontinuance of Proceedings......................................................... 24 SECTION 7.16 Application of Proceeds............................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies...................................................... 24 SECTION 7.18 Indemnity............................................................................. 25 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc................................................. 25 SECTION 8.02 Performance at Mortgagor's Expense.................................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations........................................... 26 SECTION 8.04 Further Assurances.................................................................... 26 SECTION 8.05 Notices............................................................................... 26 SECTION 8.06 No Waiver............................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures.............................. 26 SECTION 8.08 Successors and Assigns................................................................ 27 SECTION 8.09 Severability.......................................................................... 27 SECTION 8.10 Entire Agreement and Modification..................................................... 27 SECTION 8.11 Applicable Law........................................................................ 28 SECTION 8.12 Satisfaction of Prior Encumbrance..................................................... 28 SECTION 8.13 No Partnership........................................................................ 28 SECTION 8.14 Headings.............................................................................. 28 SECTION 8.15 Release of Mortgage................................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property.................................................................... 28 SECTION 8.17 Inconsistency with Indenture.......................................................... 29

ii SECTION 8.18 Limitation on Interest Payable........................................................ 29 SECTION 8.19 Covenants To Run With the Land........................................................ 30 SECTION 8.20 Intentionally omitted................................................................. 30 SECTION 8.21 Defense of Claims..................................................................... 30 SECTION 8.22 Exculpation Provisions................................................................ 30 SECTION 8.23 No Merger of Estates.................................................................. 31 SECTION 8.24 Release upon Transfer or Sale......................................................... 31 SECTION 8.25 Counterparts.......................................................................... 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS.................................................................. 31 SECTION 9.01 Additional State-Specific Provisions.................................................. 31 ARTICLE X INTERCREDITOR.......................................................................................... 31

EXHIBIT A - LEGAL DESCRIPTION iii OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by MILACRON INC., a Delaware corporation, having an office at 2090 Florence Avenue, Cincinnati, Ohio 45206, ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Mortgagor and the Guarantors (as hereinafter defined; and together with Mortgagor, each an "Obligor" and collectively, the "Obligors") and Mortgagee, in its capacity as Trustee, are parties to that certain indenture dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Mortgagor has issued the Notes to the Holders; WHEREAS, Mortgagor derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Mortgagor from Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: Milacron Inc. Type of Organization: Corporation State: Delaware FEIN: 31-1062125 Organizational ID Number: 2005100 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. This Mortgage will secure unpaid balances of any future loan advances, whether obligatory or not, made by Mortgagee after this Mortgage is delivered for record to the extent that the total unpaid Senior Secured Note Obligations and 7 advances made pursuant to designated lines of credit, exclusive of interest thereon, collection costs, and expenses incurred by Mortgagee by reason of any default of Mortgagor under the terms hereof, does not exceed the maximum amount of unpaid indebtedness which may be outstanding at any time, which is $225,000,000, provided that this Mortgage will also secure unpaid balances of advances made for the payment of taxes, assessments, insurance or expenses incurred for the protection of the Mortgaged Property. Any and all future advances under this Mortgage and the Senior Secured Note Documents shall have the same priority as if the future advance was made on that date this Mortgage was recorded. It is agreed that the lien hereby created will take precedence over and be a prior lien to any other lien of any character whether vendor's, materialmen's or mechanic's lien hereafter created on the Mortgaged Property, and in the event the proceeds of the Loan are used to pay off and satisfy any liens existing on the Mortgaged Property, then Mortgagee is, and will be, subrogated to all of the rights, liens and remedies of the holders of the indebtedness so paid. This Mortgage is given to secure repayment of advances made pursuant to the Indenture which advances are obligatory. Mortgagor agrees that the loans secured by this Mortgage may be paid out by Mortgagee as provided in the Indenture, or any amendment thereto, and Mortgagee may do all things as provided to be done by Mortgagee thereunder. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor 8 hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall 9 have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall 10 be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or such Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all 12 applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on 13 which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed 14 Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. 15 (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. 16 (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning 17 ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Mortgagor or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. 18 SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Mortgagor or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed 19 in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by 20 Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. 21 SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be 22 deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be 23 repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. 24 SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or any other Indemnitee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne 25 solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee 26 may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. 27 SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTE AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property 28 or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if 29 such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY 30 FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Additional State-Specific Provisions. Intentionally omitted. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and 31 between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 32 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: MILACRON INC., a Delaware corporation By: /s/ R.P. Lienesch ----------------- Name: R.P. Lienesch Title: Vice President - Finance and Chief Financial Officer ACKNOWLEDGEMENT STATE OF OHIO ) ) SS: COUNTY OF HAMILTON ) Executed and acknowledged before me on the 8th day of June, 2004, by R.P. Lienesch, the duly authorized VP Finance and CEO of Milacron Inc., the Mortgagor in the foregoing Mortgage, who represented to me to be said person. IN TESTIMONY WHEREOF, I have hereunto subscribed by name and affixed my notarial seal on the day and year last aforesaid. /s/ Jean Moyer -------------- Notary Public My commission expires: June 11, 2007 EXHIBIT A LEGAL DESCRIPTION Auditor's Parcel No.: __________________________________________________________ A-1 EX-4.19 62 y98028exv4w19.txt OPEN-END MORTGAGE Exhibit 4.19 OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING made by MILACRON INC. (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 3010 Disney Street Cincinnati, Ohio 45209 Hamilton County DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Attention: Jonathan P. Baumstark, Esq. Ref. No.: 030786-0117 TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above................................................................... 2 SECTION 1.02 Definitions........................................................................... 2 SECTION 1.03 Terminology........................................................................... 6 SECTION 1.04 Other Defined Terms................................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien......................................................................... 6 SECTION 2.02 Grant of Security Interest............................................................ 7 SECTION 2.03 No Obligation of Mortgagee............................................................ 7 SECTION 2.04 Fixture Filing........................................................................ 7 SECTION 2.05 Future Advances....................................................................... 7 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment............................................................................ 8 SECTION 3.02 Revocable License..................................................................... 8 SECTION 3.03 Enforcement of Leases................................................................. 9 SECTION 3.04 Direction to Tenants.................................................................. 9 SECTION 3.05 Appointment of Attorney-in-Fact....................................................... 10 SECTION 3.06 No Liability of Mortgagee............................................................. 10 SECTION 3.07 Mortgagor's Indemnities............................................................... 11 SECTION 3.08 No Modification of Mortgagor's Obligations............................................ 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage................................. 12 SECTION 4.02 Taxes and Other Payments.............................................................. 12 SECTION 4.03 Power to Create Lien and Security..................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture........................................... 12 SECTION 4.05 Compliance with Laws.................................................................. 12 SECTION 4.06 No Condemnation....................................................................... 13 SECTION 4.07 Flood Zone............................................................................ 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status........................................................................... 13 SECTION 5.02 Payment of Impositions................................................................ 13 SECTION 5.03 Repair................................................................................ 14 SECTION 5.04 Insurance and Application of Insurance Proceeds....................................... 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds................................. 16 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights.................... 17 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............................ 18 SECTION 5.08 Compliance with Permitted Liens and Other Obligations................................. 18 SECTION 5.09 Additional Affirmative Covenants...................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18 SECTION 6.01 Use Violations........................................................................ 18
i SECTION 6.02 Waste................................................................................. 18 SECTION 6.03 Alterations........................................................................... 18 SECTION 6.04 No Further Encumbrances............................................................... 19 SECTION 6.05 Transfer Restrictions................................................................. 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............................................................................. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default...................................................................... 19 SECTION 7.02 Acceleration.......................................................................... 19 SECTION 7.03 Foreclosure and Sale.................................................................. 19 SECTION 7.04 Mortgagee's Agents.................................................................... 20 SECTION 7.05 Judicial Foreclosure.................................................................. 21 SECTION 7.06 Receiver.............................................................................. 21 SECTION 7.07 Foreclosure for Installments.......................................................... 21 SECTION 7.08 Separate Sales........................................................................ 21 SECTION 7.09 Possession of Mortgaged Property...................................................... 22 SECTION 7.10 Occupancy After Acceleration.......................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive...................................... 22 SECTION 7.12 No Release of Senior Secured Note Obligations......................................... 23 SECTION 7.13 Release of and Resort to Collateral................................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................................ 23 SECTION 7.15 Discontinuance of Proceedings......................................................... 24 SECTION 7.16 Application of Proceeds............................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies...................................................... 24 SECTION 7.18 Indemnity............................................................................. 25 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc................................................. 25 SECTION 8.02 Performance at Mortgagor's Expense.................................................... 25 SECTION 8.03 Survival of Senior Secured Note Obligations........................................... 26 SECTION 8.04 Further Assurances.................................................................... 26 SECTION 8.05 Notices............................................................................... 26 SECTION 8.06 No Waiver............................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures.............................. 26 SECTION 8.08 Successors and Assigns................................................................ 27 SECTION 8.09 Severability.......................................................................... 27 SECTION 8.10 Entire Agreement and Modification..................................................... 27 SECTION 8.11 Applicable Law........................................................................ 28 SECTION 8.12 Satisfaction of Prior Encumbrance..................................................... 28 SECTION 8.13 No Partnership........................................................................ 28 SECTION 8.14 Headings.............................................................................. 28 SECTION 8.15 Release of Mortgage................................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property.................................................................... 28 SECTION 8.17 Inconsistency with Indenture.......................................................... 29 SECTION 8.18 Limitation on Interest Payable........................................................ 29

ii SECTION 8.19 Covenants To Run With the Land........................................................ 30 SECTION 8.20 Intentionally omitted................................................................. 30 SECTION 8.21 Defense of Claims..................................................................... 30 SECTION 8.22 Exculpation Provisions................................................................ 30 SECTION 8.23 No Merger of Estates.................................................................. 31 SECTION 8.24 Release upon Transfer or Sale......................................................... 31 SECTION 8.25 Counterparts.......................................................................... 31 ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS.................................................................. 31 SECTION 9.01 Additional State-Specific Provisions.................................................. 31 ARTICLE X INTERCREDITOR.......................................................................................... 31

EXHIBIT A - LEGAL DESCRIPTION iii OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by MILACRON INC., a Delaware corporation, having an office at 2090 Florence Avenue, Cincinnati, Ohio 45206, ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Mortgagor, and the Guarantors (as hereinafter defined; and together with Mortgagor, each an "Obligor" and collectively the "Obligors"), and Mortgagee, in its capacity as Trustee are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Mortgagor's 11 1/2 % Senior Secured Notes due 2011 (the "Notes") WHEREAS, pursuant to the Indenture, Mortgagor has issued the Notes to the Holders; WHEREAS, Mortgagor derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Mortgagor from the Escrow Agent that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: Milacron Inc. Type of Organization: Corporation State: Delaware FEIN: 31-1062125 Organizational ID Number: 2005100 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 SECTION 2.05 Future Advances. This Mortgage will secure unpaid balances of any future loan advances, whether obligatory or not, made by Mortgagee after this Mortgage is delivered for record to the extent that the total unpaid Senior Secured Note Obligations and 7 advances made pursuant to designated lines of credit, exclusive of interest thereon, collection costs, and expenses incurred by Mortgagee by reason of any default of Mortgagor under the terms hereof, does not exceed the maximum amount of unpaid indebtedness which may be outstanding at any time, which is $225,000,000, provided that this Mortgage will also secure unpaid balances of advances made for the payment of taxes, assessments, insurance or expenses incurred for the protection of the Mortgaged Property. Any and all future advances under this Mortgage and the Senior Secured Note Documents shall have the same priority as if the future advance was made on that date this Mortgage was recorded. It is agreed that the lien hereby created will take precedence over and be a prior lien to any other lien of any character whether vendor's, materialmen's or mechanic's lien hereafter created on the Mortgaged Property, and in the event the proceeds of the Loan are used to pay off and satisfy any liens existing on the Mortgaged Property, then Mortgagee is, and will be, subrogated to all of the rights, liens and remedies of the holders of the indebtedness so paid. This Mortgage is given to secure repayment of advances made pursuant to the Indenture which advances are obligatory. Mortgagor agrees that the loans secured by this Mortgage may be paid out by Mortgagee as provided in the Indenture, or any amendment thereto, and Mortgagee may do all things as provided to be done by Mortgagee thereunder. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor 8 hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall 9 have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall 10 be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or such Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: 11 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all 12 applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on 13 which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed 14 Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. 15 (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. 16 (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning 17 ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Obligations. Mortgagor shall comply in all material respects with any and all obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Obligor or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. 18 SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Obligor or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed 19 in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by 20 Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. 21 SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be 22 deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be 23 repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. 24 SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or any Indemnitee, or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne 25 solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee 26 may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. 27 SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE SENIOR SECURED NOTE OBLIGATIONS (WHICH SENIOR SECURED NOTE OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property 28 or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if 29 such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY 30 FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. ARTICLE IX ADDITIONAL STATE SPECIFIC PROVISIONS SECTION 9.01 Additional State-Specific Provisions. Intentionally omitted. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and 31 between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 32 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: MILACRON INC., a Delaware corporation By: /s/ R. P. Lienesch ------------------ Name: R. P. Lienesch Title: Vice President - Finance and Chief Financial Officer ACKNOWLEDGEMENT STATE OF OHIO ) ) SS: COUNTY OF HAMILTON ) Executed and acknowledged before me on the 8th day of June, 2004, by R.P. Lienesch, the duly authorized VP Finance and CFO of Milacron Inc., the Mortgagor in the foregoing Mortgage, who represented to me to be said person. IN TESTIMONY WHEREOF, I have hereunto subscribed by name and affixed my notarial seal on the day and year last aforesaid. /s/ Jean Moyer --------------- Notary Public My commission expires: June 11, 2007 EXHIBIT A LEGAL DESCRIPTION Auditor's Parcel No.: __________________________________________________________ A-1 EX-4.20 63 y98028exv4w20.txt OPEN-END MORTGAGE Exhibit 4.20 OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING made by D-M-E COMPANY (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 977 Loop Road Lewistown, Pennsylvania Mifflin County DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Attention: Jonathan P. Baumstark, Esq. Ref. No.: 030786-0117 THIS IS AN OPEN-END MORTGAGE AND SECURES FUTURE ADVANCES. TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above........................................................................ 2 SECTION 1.02 Definitions................................................................................ 2 SECTION 1.03 Terminology................................................................................ 6 SECTION 1.04 Other Defined Terms........................................................................ 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien.............................................................................. 6 SECTION 2.02 Grant of Security Interest................................................................. 7 SECTION 2.03 No Obligation of Mortgagee................................................................. 7 SECTION 2.04 Fixture Filing............................................................................. 7 SECTION 2.05 Advance Money Mortgage..................................................................... 8 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment................................................................................. 8 SECTION 3.02 Revocable License.......................................................................... 9 SECTION 3.03 Enforcement of Leases...................................................................... 9 SECTION 3.04 Direction to Tenants....................................................................... 10 SECTION 3.05 Appointment of Attorney-in-Fact............................................................ 10 SECTION 3.06 No Liability of Mortgagee.................................................................. 11 SECTION 3.07 Mortgagor's Indemnities.................................................................... 11 SECTION 3.08 No Modification of Mortgagor's Obligations................................................. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 12 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage...................................... 12 SECTION 4.02 Taxes and Other Payments................................................................... 12 SECTION 4.03 Power to Create Lien and Security.......................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture................................................ 12 SECTION 4.05 Compliance with Laws....................................................................... 12 SECTION 4.06 No Condemnation............................................................................ 13 SECTION 4.07 Flood Zone................................................................................. 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status................................................................................ 13 SECTION 5.02 Payment of Impositions..................................................................... 14 SECTION 5.03 Repair..................................................................................... 14 SECTION 5.04 Insurance and Application of Insurance Proceeds............................................ 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds...................................... 17 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights......................... 18 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations................................. 18 SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations.................. 18 SECTION 5.09 Additional Affirmative Covenants........................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18 SECTION 6.01 Use Violations............................................................................. 18
i SECTION 6.02 Waste...................................................................................... 19 SECTION 6.03 Alterations................................................................................ 19 SECTION 6.04 No Further Encumbrances.................................................................... 19 SECTION 6.05 Transfer Restrictions...................................................................... 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants................. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default........................................................................... 19 SECTION 7.02 Acceleration............................................................................... 19 SECTION 7.03 Foreclosure and Sale....................................................................... 20 SECTION 7.04 Mortgagee's Agents......................................................................... 21 SECTION 7.05 Judicial Foreclosure....................................................................... 21 SECTION 7.06 Receiver................................................................................... 21 SECTION 7.07 Foreclosure for Installments............................................................... 21 SECTION 7.08 Separate Sales............................................................................. 22 SECTION 7.09 Possession of Mortgaged Property........................................................... 22 SECTION 7.10 Occupancy After Acceleration............................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive........................................... 23 SECTION 7.12 No Release of Senior Secured Note Obligations.............................................. 23 SECTION 7.13 Release of and Resort to Collateral........................................................ 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets..................................... 23 SECTION 7.15 Discontinuance of Proceedings.............................................................. 24 SECTION 7.16 Application of Proceeds.................................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies........................................................... 25 SECTION 7.18 Indemnity.................................................................................. 25 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc...................................................... 26 SECTION 8.02 Performance at Mortgagor's Expense......................................................... 26 SECTION 8.03 Survival of Senior Secured Note Obligations................................................ 26 SECTION 8.04 Further Assurances......................................................................... 26 SECTION 8.05 Notices.................................................................................... 26 SECTION 8.06 No Waiver.................................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures................................... 27 SECTION 8.08 Successors and Assigns..................................................................... 27 SECTION 8.09 Severability............................................................................... 27 SECTION 8.10 Entire Agreement and Modification.......................................................... 28 SECTION 8.11 Applicable Law............................................................................. 28 SECTION 8.12 Satisfaction of Prior Encumbrance.......................................................... 28 SECTION 8.13 No Partnership............................................................................. 28 SECTION 8.14 Headings................................................................................... 28 SECTION 8.15 Release of Mortgage........................................................................ 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property................................................................................... 29 SECTION 8.17 Inconsistency with Indenture............................................................... 29 SECTION 8.18 Limitation on Interest Payable............................................................. 29 SECTION 8.19 Covenants To Run With the Land............................................................. 30 SECTION 8.20 Intentionally Omitted...................................................................... 30

ii SECTION 8.21 Defense of Claims.......................................................................... 30 SECTION 8.22 Exculpation Provisions..................................................................... 30 SECTION 8.23 No Merger of Estates....................................................................... 31 SECTION 8.24 Release upon Transfer or Sale.............................................................. 31 SECTION 8.25 Counterparts............................................................................... 31 ARTICLE IX STATE SPECIFIC PROVISIONS............................................................................. 32 SECTION 9.01 State-Specific Provisions.................................................................. 32 ARTICLE X INTERCREDITOR.......................................................................................... 32

EXHIBIT A - LEGAL DESCRIPTION iii OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS IS AN OPEN-END MORTGAGE AND SECURES FUTURE ADVANCES. THIS OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E COMPANY, a Delaware corporation, having an office at 29111 Stephenson Highway, Madison Heights, MI 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively, the "Obligors"), and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004 (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed that certain Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations, and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E Company Type of Organization: Corporation State: Delaware FEIN: 31-1453086 Organizational ID Number: 2580409 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio, 45202 7 SECTION 2.05 Advance Money Mortgage. (a) This Mortgage is an "Open-End Mortgage" as set forth in 42 Pa. C.S.A. Section 8143 and secures future advances made pursuant to this Mortgage or pursuant to the Indenture. Without limiting the foregoing, this Mortgage secures all advances made by Mortgagee or Holders of any kind or nature described in 42 Pa. C.S.A. Section 8144. Any and all future advances under this Mortgage and the Senior Secured Note Documents shall have the same priority as if the future advance was made on that date this Mortgage was recorded. (b) If Mortgagor sends a written notice to Mortgagee or any Holder which purports to limit the indebtedness secured by this Mortgage and to release the obligation of Mortgagee or Holders to make any additional advances to or for the benefit of Mortgagor, such a notice shall be ineffective as to any future advances made: (i) to enable completion of the improvements on the Land for which the loan secured hereby was originally made; (ii) to pay taxes, assessments, maintenance charges and insurance premiums; (iii) for costs incurred for the protection of the Mortgaged Property or the lien of this Mortgage; (iv) on account of expenses incurred by Mortgagee or Holders by reason of a default of Mortgagor hereunder or under the Indenture or under the other Senior Secured Note Documents; and (v) on account of any other costs incurred by Mortgagee or Holders to protect and preserve the Mortgaged Property or the lien of this Mortgage. It is the intention of the parties hereto that any such advance made by Mortgagee or any Holder after any such notice by Mortgagor shall be secured by the lien of this Mortgage on the Mortgaged Property. (c) All notices to be given to the Mortgagee pursuant to 42 Pa. C.S.A. Section 8143 shall be given as set forth in Section 8.05. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. 8 SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. 9 SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. 10 SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by Mortgagor have been filed, or extensions have been obtained and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, 12 requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security 13 interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all 14 other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss 15 payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If 16 the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. 17 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations. Mortgagor shall comply in all material respects with any and all Senior Secured Note Obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private 18 nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, 19 demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all 20 other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without 21 exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its 22 successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors, Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or 23 future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. 24 SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PARTY WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PARTY OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS 25 SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of 26 Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of 27 such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTE AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon 28 the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under 29 the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally Omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE 30 TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. 31 ARTICLE IX STATE SPECIFIC PROVISIONS SECTION 9.01 State-Specific Provisions. Intentionally Omitted. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 32 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E COMPANY, a Delaware corporation By: /s/ R.P. Lienesch ----------------- Name: R.P. Lienesch Title: Vice President The Address of Mortgagee is: U.S. BANK NATIONAL ASSOCIATION, as Trustee and Collateral Agent 425 Walnut Street, Cincinnati, Ohio 45202 Attention: Corporate Trust Office ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 10, 2004, before me the undersigned personally appeared R.P. Lienesch, the duly authorized Vice President of D-M-E Company personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/ their capacity (ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ P. Michelle Bevan --------------------- (signature and office of individual taking acknowledgment) EXHIBIT A LEGAL DESCRIPTION Tax parcel #_________________ A-1 EX-4.21 64 y98028exv4w21.txt OPEN-END MORTGAGE Exhibit 4.21 OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING made by D-M-E COMPANY (MORTGAGOR) in favor of U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT (MORTGAGEE) PROPERTY LOCATION: 70 East Hillis Street Youngwood, Pennsylvania 15697 Westmoreland County DATED AS OF JUNE 10, 2004 THIS MORTGAGE WAS PREPARED BY AND WHEN RECORDED, RETURN TO: Latham & Watkins LLP 885 Third Ave, Suite 1000 New York, New York 10022 Attention: Jonathan P. Baumstark, Esq. Ref. No.: 030786-0117 THIS IS AN OPEN-END MORTGAGE AND SECURES FUTURE ADVANCES. TABLE OF CONTENTS
PAGE ---- ARTICLE I DEFINITIONS............................................................................................ 2 SECTION 1.01 Terms Defined Above................................................................... 2 SECTION 1.02 Definitions........................................................................... 2 SECTION 1.03 Terminology........................................................................... 6 SECTION 1.04 Other Defined Terms................................................................... 6 ARTICLE II GRANT OF LIEN AND SECURITY INTEREST................................................................... 6 SECTION 2.01 Grant of Lien......................................................................... 6 SECTION 2.02 Grant of Security Interest............................................................ 7 SECTION 2.03 No Obligation of Mortgagee............................................................ 7 SECTION 2.04 Fixture Filing........................................................................ 7 SECTION 2.05 Advance Money Mortgage................................................................ 8 ARTICLE III ASSIGNMENT OF LEASES AND RENTS....................................................................... 8 SECTION 3.01 Assignment............................................................................ 8 SECTION 3.02 Revocable License..................................................................... 9 SECTION 3.03 Enforcement of Leases................................................................. 9 SECTION 3.04 Direction to Tenants.................................................................. 10 SECTION 3.05 Appointment of Attorney-in-Fact....................................................... 10 SECTION 3.06 No Liability of Mortgagee............................................................. 11 SECTION 3.07 Mortgagor's Indemnities............................................................... 11 SECTION 3.08 No Modification of Mortgagor's Obligations............................................ 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................ 12 SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage................................. 12 SECTION 4.02 Taxes and Other Payments.............................................................. 12 SECTION 4.03 Power to Create Lien and Security..................................................... 12 SECTION 4.04 Senior Secured Note Documents and Indenture........................................... 12 SECTION 4.05 Compliance with Laws.................................................................. 12 SECTION 4.06 No Condemnation....................................................................... 13 SECTION 4.07 Flood Zone............................................................................ 13 ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 13 SECTION 5.01 Lien Status........................................................................... 13 SECTION 5.02 Payment of Impositions................................................................ 14 SECTION 5.03 Repair................................................................................ 14 SECTION 5.04 Insurance and Application of Insurance Proceeds....................................... 14 SECTION 5.05 Condemnation and Application of Condemnation Proceeds................................. 17 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights.................... 18 SECTION 5.07 Payment and Performance of Senior Secured Note Obligations............................ 18 SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations........................................................................... 18
i SECTION 5.09 Additional Affirmative Covenants...................................................... 18 ARTICLE VI NEGATIVE COVENANTS.................................................................................... 18 SECTION 6.01 Use Violations........................................................................ 18 SECTION 6.02 Waste................................................................................. 19 SECTION 6.03 Alterations........................................................................... 19 SECTION 6.04 No Further Encumbrances............................................................... 19 SECTION 6.05 Transfer Restrictions................................................................. 19 SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants............................................................................. 19 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES....................................................................... 19 SECTION 7.01 Event of Default...................................................................... 19 SECTION 7.02 Acceleration.......................................................................... 19 SECTION 7.03 Foreclosure and Sale.................................................................. 20 SECTION 7.04 Mortgagee's Agents.................................................................... 21 SECTION 7.05 Judicial Foreclosure.................................................................. 21 SECTION 7.06 Receiver.............................................................................. 21 SECTION 7.07 Foreclosure for Installments.......................................................... 21 SECTION 7.08 Separate Sales........................................................................ 22 SECTION 7.09 Possession of Mortgaged Property...................................................... 22 SECTION 7.10 Occupancy After Acceleration.......................................................... 22 SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive...................................... 23 SECTION 7.12 No Release of Senior Secured Note Obligations......................................... 23 SECTION 7.13 Release of and Resort to Collateral................................................... 23 SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets................................ 23 SECTION 7.15 Discontinuance of Proceedings......................................................... 24 SECTION 7.16 Application of Proceeds............................................................... 24 SECTION 7.17 Uniform Commercial Code Remedies...................................................... 25 SECTION 7.18 Indemnity............................................................................. 25 ARTICLE VIII MISCELLANEOUS....................................................................................... 25 SECTION 8.01 Instrument Construed as Mortgage, Etc................................................. 25 SECTION 8.02 Performance at Mortgagor's Expense.................................................... 26 SECTION 8.03 Survival of Senior Secured Note Obligations........................................... 26 SECTION 8.04 Further Assurances.................................................................... 26 SECTION 8.05 Notices............................................................................... 26 SECTION 8.06 No Waiver............................................................................. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures.............................. 27 SECTION 8.08 Successors and Assigns................................................................ 27 SECTION 8.09 Severability.......................................................................... 27 SECTION 8.10 Entire Agreement and Modification..................................................... 28 SECTION 8.11 Applicable Law........................................................................ 28 SECTION 8.12 Satisfaction of Prior Encumbrance..................................................... 28 SECTION 8.13 No Partnership........................................................................ 28 SECTION 8.14 Headings.............................................................................. 28

ii SECTION 8.15 Release of Mortgage................................................................... 28 SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property.................................................................... 29 SECTION 8.17 Inconsistency with Indenture.......................................................... 29 SECTION 8.18 Limitation on Interest Payable........................................................ 29 SECTION 8.19 Covenants To Run With the Land........................................................ 30 SECTION 8.20 Intentionally Omitted................................................................. 30 SECTION 8.21 Defense of Claims..................................................................... 30 SECTION 8.22 Exculpation Provisions................................................................ 30 SECTION 8.23 No Merger of Estates.................................................................. 31 SECTION 8.24 Release Upon Transfer or Sale......................................................... 31 SECTION 8.25 Counterparts.......................................................................... 31 ARTICLE IX STATE SPECIFIC PROVISIONS............................................................................. 32 SECTION 9.01 State-Specific Provisions............................................................. 32 ARTICLE X INTERCREDITOR.......................................................................................... 32

EXHIBIT A - LEGAL DESCRIPTION iii OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING THIS IS AN OPEN-END MORTGAGE AND SECURES FUTURE ADVANCES. THIS OPEN-END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (hereinafter, together with any and all amendments, supplements, modifications or restatements of any kind, referred to as this "Mortgage"), is made as of June 10, 2004, by D-M-E COMPANY, a Delaware corporation, having an office at 29111 Stephenson Highway, Madison Heights, MI 48071 ("Mortgagor"), in favor of U.S. BANK NATIONAL ASSOCIATION, having an office at 425 Walnut Street, Cincinnati, Ohio 45202, as Trustee and Collateral Agent (in such capacity, together with its successors and assigns, "Mortgagee"). RECITALS: WHEREAS, Mortgagor is the owner and holder of fee simple title in and to the Land (as hereinafter defined) described on Exhibit A attached hereto and made a part hereof; WHEREAS, Milacron Inc. ("Parent"), the Guarantors (as hereinafter defined; and together with Parent, each an "Obligor" and collectively, the "Obligors"), and Mortgagee, in its capacity as Trustee, are parties to that certain indenture, dated as of May 26, 2004, (as the same may be amended, restated, modified, supplemented or otherwise changed and in effect from time to time, the "Indenture"), with respect to Parent's 11 1/2 % Senior Secured Notes due 2011 (the "Notes"); WHEREAS, pursuant to the Indenture, Parent has issued the Notes to the Holders; WHEREAS, Mortgagor, as a subsidiary of Parent, derived direct economic benefit from the offering of the Notes and, in order to induce the Holders to purchase the Notes, Mortgagor and the other Guarantors have each executed a Guarantee; WHEREAS, it is a condition to the release of the proceeds from the offering of the Notes to Parent from the Escrow Account that Mortgagor grant to Mortgagee, on behalf of the Holders, a security interest in and a mortgage lien upon the Mortgaged Property (as hereinafter defined), to secure (a) the payment of all of the Senior Secured Note Obligations and (b) the performance of all terms, covenants, conditions, provisions, agreements and liabilities contained in this Mortgage, the Indenture, the Guarantee and the other Senior Secured Note Documents. NOW, THEREFORE, in order to comply with the terms and conditions of the Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby agrees with Mortgagee as follows: ARTICLE I DEFINITIONS SECTION 1.01 Terms Defined Above. As used in this Mortgage, the terms defined in the introductory paragraph to this Mortgage and in the Recitals set forth above shall have the meanings respectively assigned to such terms in such paragraph and Recitals. SECTION 1.02 Definitions. As used herein, the following terms shall have the following meanings: "Applicable UCC" means the Uniform Commercial Code as presently in effect in the State or Commonwealth where the Mortgaged Property is located. "Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C. Section 101, et. seq.), as amended, and any successor statute. "Buildings" means any and all buildings, structures, garages, utility sheds, workrooms, air conditioning towers, open parking areas and other improvements, and any and all additions, alterations, betterments or appurtenances thereto, now or at any time hereafter situated, placed or constructed upon the Land or any part thereof. "Collateral Agent" has the meaning assigned to such term in the Indenture. "Default" has the meaning assigned to such term in the Indenture. "Default Rate" shall mean the interest rate applicable pursuant to the Notes for any payment not paid when due. "Event of Default" has the meaning assigned to such term in Section 7.01 hereof. "Fixtures" means all materials, supplies, equipment, apparatus and other items now or hereafter acquired by Mortgagor and incorporated into the Mortgaged Property so as to constitute fixtures under the laws of the state or commonwealth in which such items are located. "Governmental Authority" means any nation or government, any Federal, state, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, board, bureau, instrumentality, agency or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions pertaining to government. "Governmental Requirements" means any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Mortgagor or the Mortgaged Property, including the ownership, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof. 2 "Guarantors" has the meaning assigned to such term in the Indenture. "Guarantor" means any of the Guarantors. "Impositions" means any and all real estate and personal property taxes; water, gas, sewer, electricity and other utility rates and charges; charges for any easement, license or agreement maintained for the benefit of the Mortgaged Property; and any and all other taxes, charges and assessments, whether general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied or imposed upon the Mortgaged Property or the ownership, use, occupancy, benefit or enjoyment thereof, together with any interest, costs or penalties that may become payable in connection therewith. "Indemnified Parties" means, with respect to any Person entitled to the benefit of an indemnity, such Person and its officers, directors, shareholders, partners, members, managers, employees, agents, representatives, attorneys, accountants and experts. The term "Indemnified Party" means any one of such Persons. "Land" means the real property or interest therein described in Exhibit A attached hereto, and all rights, titles and interests appurtenant thereto. "Leases" means any and all leases, master leases, subleases, licenses, concessions or other agreements (whether written or oral, and whether now or hereafter in effect) which grant to third Persons a possessory interest in and to, or the right to use, all or any part of the Mortgaged Property, together with all security and other deposits made in connection therewith and any guarantee of the obligations of the landlord or the tenant thereunder. "License" has the meaning assigned to such term in Section 3.02(a) hereof. "Lien" has the meaning assigned to such term in the Indenture. "Losses" means all obligations, damages, claims, causes of action, costs, fines, fees, charges, penalties, deficiencies, losses, diminutions in value, expenses (including court costs, fees and expenses of attorneys, accountants, consultants and other experts) and other liabilities, and, with respect to any indemnity, includes all attorneys' fees and expenses in connection with the enforcement and collection of such indemnity. The term "Loss" means any such Losses. "Mortgaged Property" means all of Mortgagor's right, title, interest and estate, whether now owned or hereafter acquired, in and to the Land, the Buildings, the Fixtures and the Personalty, together with: (i) all rights, privileges, tenements, hereditaments, rights-of-way, easements, air rights, development rights or credits, zoning rights, appendages and appurtenances in anywise appertaining thereto, and all right, title and interest of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, and all right, title and interest of Mortgagor, if any, in and to all rights, royalties and profits with respect to all minerals, coal, oil, gas and other substances of any kind or character 3 on or underlying the Land, together with all right, title and interest of Mortgagor in and to all water and water rights (whether riparian, appropriative or otherwise and whether or not appurtenant); (ii) all rights of Mortgagor (but not its obligations) under any contracts and agreements, including, without limitation, construction contracts and architectural agreements, relating to the Land, the Buildings, the Fixtures or the Personalty; (iii) all of Mortgagor's right, title and interest in and to all permits, licenses, franchises, certificates, authorizations, consents, approvals and other rights and privileges (each, a "Permit") obtained in connection with the Land, the Buildings, the Fixtures or the Personalty or the use or operation thereof; (iv) all of Mortgagor's right, title and interest in and to all plans and specifications, designs, schematics, drawings and other information, materials and matters heretofore or hereafter prepared relating to the Land, the Buildings, the Fixtures or the Personalty; (v) all of Mortgagor's right, title and interest in and to all proceeds arising from or by virtue of the sale, lease or other disposition of the Land, the Buildings, the Fixtures or the Personalty or any part thereof or any interest therein or from the operation thereof; (vi) all of Mortgagor's right, title and interest in and to all Leases now or hereafter in effect and all Rents, royalties, bonuses, issues, profits, revenues or other benefits arising from or attributable to the Land, the Buildings, the Fixtures or the Personalty; (vii) all of Mortgagor's right, title and interest in and to all betterments, additions, alterations, appurtenances, substitutions, replacements and revisions to the Land, the Buildings, the Fixtures or the Personalty and all reversions and remainders relating thereto; (viii) all of Mortgagor's right, title and interest in and to any awards, remuneration, settlements or compensation now or hereafter made by any Governmental Authority pertaining to the Land, the Buildings, the Fixtures or the Personalty, including those arising from or attributable to any vacation of, or change of grade in, any streets affecting the Land or the Buildings; (ix) all of Mortgagor's right, title and interest in and to any and all other security and collateral of any nature whatsoever, whether now or hereafter given, for the repayment, performance and discharge of the Senior Secured Note Obligations (as hereinafter defined); 4 (x) all right to make all divisions under Section 108 of the Land Division Act, Act No. 288 of the Public Acts of 1967; (xi) all of Mortgagor's right, title and interest in and to all awards, payments and proceeds of conversion, whether voluntary or involuntary, of any of the Land, the Buildings, the Fixtures, the Personalty or any of the property and rights described in the foregoing clauses (i) through (ix), including without limitation, all insurance, condemnation and tort claims, refunds of real estate taxes and assessments, rent claims and other obligations dischargeable in cash or cash equivalents; and (xii) all other property and rights of Mortgagor of every kind and character relating to and/or used or to be used in connection with the foregoing, and all proceeds and products of any of the foregoing. As used in this Mortgage, the term "Mortgaged Property" shall be expressly defined as meaning all or, where the context permits or requires, any portion of the above, and all or, where the context permits or requires, any interest therein. "Notes" has the meaning assigned to such term in the recitals to this Mortgage. "Obligors" has the meaning assigned to such term in the recitals to this Mortgage. "Obligor" means any of the Obligors. "Permitted Liens" shall mean, collectively, the Permitted Liens and the Permitted Prior Liens, each as defined in the Indenture. "Person" has the meaning assigned to such term in the Indenture. "Personalty" means all of Mortgagor's right, title and interest in and to all furniture, furnishings, equipment, machinery, goods, general intangibles, money, insurance proceeds, contract rights, option rights, inventory, together with all refundable, returnable or reimbursable fees, deposits or other funds or evidences of credit or indebtedness deposited by or on behalf of Mortgagor with any Governmental Authority, boards, corporations, providers of utility services, public or private including all refundable, returnable or reimbursable tap fees, utility deposits, commitment fees and development costs, and all other personal property (other than Fixtures) of any kind or character), and including all such property that is now or hereafter located or to be located upon, within or about the Land and the Buildings, or which are or may be used in or related to the planning, development, financing or operation of the Mortgaged Property, together with all accessories, replacements and substitutions thereto or therefor and the proceeds thereof. "Principal Balance" has the meaning assigned to such term in Section 7.02 hereof. "Rents" means all of the rents, revenues, income, proceeds, issues, profits, security and other types of deposits (after Mortgagor acquires title thereto), and other benefits paid or payable by parties (other than Mortgagor) for using, leasing, licensing, possessing, 5 operating from, residing in, benefiting from or otherwise enjoying all or any part of the Land, the Buildings, the Fixtures and/or the Personalty. "Senior Secured Note Documents" has the meaning assigned to such term in the Indenture. "Senior Secured Note Obligations" has the meaning assigned to such term in the Indenture. SECTION 1.03 Terminology. Except as otherwise provided herein: (a) references to Articles and Sections shall mean the corresponding Article or Section of this Mortgage; (b) words used herein in the singular, where the context so permits, shall be deemed to include the plural and vice versa, and the definitions of words used in the singular herein shall apply to such words when used in the plural where the context so permits and vice versa; (c) the words "herein," "hereof," "hereunder," and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular Article or Section; and (d) the words "includes" or "including" mean includes or including, without limitation. SECTION 1.04 Other Defined Terms. Any capitalized term used in this Mortgage and not otherwise defined herein shall have the meaning assigned to such term in the Indenture. ARTICLE II GRANT OF LIEN AND SECURITY INTEREST SECTION 2.01 Grant of Lien. To secure the full and timely payment, performance and discharge of all of the Senior Secured Note Obligations, Mortgagor hereby irrevocably GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, MORTGAGES, CONVEYS AND CONFIRMS unto Mortgagee, WITH POWER OF SALE and right of entry and possession, for the use and benefit of Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, all right, title, interest and estate in, to and under the Mortgaged Property, subject, however, to the Permitted Liens; TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee, subject to the terms and conditions of this Mortgage, with POWER OF SALE, forever, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then the Liens, estates and rights granted by this Mortgage shall cease and terminate. 6 SECTION 2.02 Grant of Security Interest. This Mortgage shall be construed as a mortgage on the Land and the Buildings and it shall also constitute and serve as a "security agreement" within the meaning of, and shall constitute a security interest under, the Applicable UCC with respect to the Personalty and the Fixtures. To this end, Mortgagor by these presents does GRANT, BARGAIN, CONVEY, ASSIGN, SELL, TRANSFER AND SET OVER unto Mortgagee, as Collateral Agent and Trustee for the Holders pursuant to the Indenture, a security interest in all of Mortgagor's right, title and interest in, to and under the Personalty and the Fixtures, to secure the full and timely payment, performance and discharge of the Senior Secured Note Obligations. Mortgagor hereby consents to Mortgagee filing and recording financing statements (and continuations thereof) with the appropriate filing and recording offices in order to perfect (and maintain the perfection of) the security interests granted herein. SECTION 2.03 No Obligation of Mortgagee. The assignment and security interest herein granted to Mortgagee shall not be deemed or construed to constitute Mortgagee as a mortgagee-in-possession of the Mortgaged Property, obligate Mortgagee to lease the Mortgaged Property or attempt to do the same, or to take any action, incur any expense or perform or discharge any obligation, duty or liability whatsoever. SECTION 2.04 Fixture Filing. Without in any manner limiting the generality of any of the other provisions of this Mortgage: (a) some portions of the goods described or to which reference is made herein are or are to become fixtures on the Land described or to which reference is made herein or on Exhibit A attached to this Mortgage; (b) this Mortgage is to be filed of record in, among other places, the real estate records of the county in which the Land is located as a financing statement and shall constitute a "financing statement" and a "fixture filing" for purposes of the Applicable UCC; and (c) Mortgagor is the record owner of the real estate or interests in the real estate constituting the Mortgaged Property hereunder. Information concerning the security interest herein granted may be obtained at the addresses set forth on the first page hereof. The addresses of the Secured Party (Mortgagee) and of the Debtor (Mortgagor) are set forth on the first page hereof. In that regard, the following information is provided: Name of Debtor: D-M-E Company Type of Organization: Corporation State: Delaware FEIN: 31-1453086 Organizational ID Number: 2580409 Name of Secured Party: U.S. BANK NATIONAL ASSOCIATION Address of Secured Party: 425 Walnut Street, Cincinnati, Ohio 45202 7 SECTION 2.05 Advance Money Mortgage. (a) This Mortgage is an "Open-End Mortgage" as set forth in 42 Pa. C.S.A. Section 8143 and secures future advances made pursuant to this Mortgage or pursuant to the Indenture. Without limiting the foregoing, this Mortgage secures all advances made by Mortgagee or Holders of any kind or nature described in 42 Pa. C.S.A. Section 8144. Any and all future advances under this Mortgage and the Senior Secured Note Documents shall have the same priority as if the future advance was made on that date this Mortgage was recorded. (b) If Mortgagor sends a written notice to Mortgagee or any Holder which purports to limit the indebtedness secured by this Mortgage and to release the obligation of Mortgagee or Holders to make any additional advances to or for the benefit of Mortgagor, such a notice shall be ineffective as to any future advances made: (i) to enable completion of the improvements on the Land for which the loan secured hereby was originally made; (ii) to pay taxes, assessments, maintenance charges and insurance premiums; (iii) for costs incurred for the protection of the Mortgaged Property or the lien of this Mortgage; (iv) on account of expenses incurred by Mortgagee or Holders by reason of a default of Mortgagor hereunder or under the Indenture or under the other Senior Secured Note Documents; and (v) on account of any other costs incurred by Mortgagee or Holders to protect and preserve the Mortgaged Property or the lien of this Mortgage. It is the intention of the parties hereto that any such advance made by Mortgagee or any Holder after any such notice by Mortgagor shall be secured by the lien of this Mortgage on the Mortgaged Property. (c) All notices to be given to the Mortgagee pursuant to 42 Pa. C.S.A. Section 8143 shall be given as set forth in Section 8.05. ARTICLE III ASSIGNMENT OF LEASES AND RENTS SECTION 3.01 Assignment. For Ten Dollars ($10.00) and other good and valuable consideration, including the indebtedness evidenced by the Indenture, the receipt and sufficiency of which are hereby acknowledged and confessed, Mortgagor has presently, absolutely and irrevocably GRANTED, BARGAINED, SOLD, ASSIGNED, TRANSFERRED, CONVEYED and CONFIRMED, and by these presents does presently, absolutely and irrevocably GRANT, BARGAIN, SELL, ASSIGN, TRANSFER, CONVEY and CONFIRM, unto Mortgagee, as Collateral Agent and Trustee pursuant to the Indenture, as security for the payment, performance and discharge of the Senior Secured Note Obligations, all of the Leases and Rents (if any), subject only to the Permitted Liens applicable thereto and the License (as hereinafter defined); TO HAVE AND TO HOLD the Leases and the Rents unto Mortgagee, forever, and Mortgagor does hereby bind itself, its successors and assigns to warrant and forever defend the title to the Leases and the Rents unto Mortgagee against every Person whomsoever lawfully claiming or to claim the same or any part thereof; provided, however, that if Mortgagor shall pay (or cause to be paid) and perform and discharge (or cause to be performed and discharged) all of the Senior Secured Note Obligations on or before the date on which the same are to be paid, performed and discharged, then this assignment shall terminate, and all rights, titles and interests conveyed pursuant to this assignment shall become vested in Mortgagor. 8 SECTION 3.02 Revocable License. (a) Mortgagee hereby grants to Mortgagor a revocable license (the "License"), nonexclusive with the rights of Mortgagee reserved in Sections 3.02(b), 3.04 and 3.05 hereof, to exercise and enjoy all incidences of the status of a lessor under the Leases and the Rents, including, without limitation, the right to collect, demand, sue for, attach, levy, recover and receive the Rents and to give proper receipts, releases and acquittances therefor. Mortgagor hereby agrees to receive all Rents and hold the same as a trust fund to be applied, and to apply the Rents so collected, except to the extent otherwise provided in the Indenture, first to the payment, performance and discharge of the Senior Secured Note Obligations and then to the payment of the Impositions. Thereafter, Mortgagor may use the balance of the Rents collected in any manner not inconsistent with the Senior Secured Note Documents. (b) If an Event of Default shall occur and be continuing, the License shall immediately and automatically terminate without the necessity of any action by Mortgagee or any other Person, and Mortgagee shall have the right in such event to exercise the rights and remedies provided under this Mortgage or otherwise available to Mortgagee under applicable law. Upon demand by Mortgagee at any time that an Event of Default shall have occurred and be continuing, Mortgagor shall promptly pay to Mortgagee all security deposits under the Leases and all Rents allocable to any period commencing from and after the occurrence of such Event of Default. Any Rents received hereunder by Mortgagee shall be applied and disbursed to the payment, performance and discharge of the Senior Secured Note Obligations, subject to the terms of the Indenture; provided, however, that, subject to any applicable requirement of law, any security deposits actually received by Mortgagee shall be held, applied and disbursed as provided in the applicable Leases. SECTION 3.03 Enforcement of Leases. Mortgagor shall (a) submit any and all proposed Leases (including subleases provided to Mortgagor for approval) to Mortgagee for approval prior to the execution thereof or consent thereto, as applicable; (b) duly and punctually perform and comply with any and all representations, warranties, covenants and agreements expressed as binding upon the lessor under any Lease; (c) maintain each Lease in full force and effect during the term thereof; (d) provide Mortgagee with prompt notice of each notice of default sent to a tenant under a Lease, provide Mortgagee with prompt notice of each notice of default received from (or relating to) a tenant under a Lease, and otherwise promptly reasonably indicate that a material default or termination of a Lease may occur (other than by reason of the expiration of the term of such Lease); (e) appear in and defend any action or proceeding in any manner connected with any of the Leases; (f) deliver to Mortgagee true and complete copies of all Leases; and (g) deliver to Mortgagee all such further information, and execute and deliver to Mortgagee such further assurances and assignments, with respect to the Leases as Mortgagee may from time to time reasonably request. Without Mortgagee's prior written consent, Mortgagor shall not (i) do or knowingly permit to be done anything to materially impair the value of any of the Leases; (ii) except for security or similar deposits, collect any of the Rent more than one (1) month in advance of the time when the same becomes due under the terms of any Lease; (iii) discount any future accruing Rents; (iv) materially amend or modify, or accept the surrender of or terminate any of the Leases; or (v) assign or grant a security interest in or to the License or any of the Leases or Rents. 9 SECTION 3.04 Direction to Tenants. Upon and at any time following the occurrence and during the continuance of an Event of Default, Mortgagor hereby authorizes and directs, and shall, at the direction of Mortgagee, further authorize and direct, in writing, the tenant under each Lease to pay directly to, or as directed by, Mortgagee all Rents accruing or due under its Lease, without proof to the tenant of the occurrence and continuance of such Event of Default. Mortgagor hereby authorizes the tenant under each Lease to rely upon and comply with any notice or demand from Mortgagee for payment of Rents to Mortgagee, and Mortgagor shall have no claim against any tenant for Rents paid by such tenant to Mortgagee pursuant to such notice or demand. All Rents actually collected by Mortgagee pursuant to this Section 3.04 shall be applied in accordance with the Indenture. SECTION 3.05 Appointment of Attorney-in-Fact. (a) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to, upon the occurrence and during the continuance of an Event of Default, demand, sue for, attach, levy, recover and receive any of the Rents and any premium or penalty payable upon the exercise by any third Person under any Lease of a privilege of cancellation originally provided in such Lease and to give proper receipts, releases and acquittances therefor and, after deducting expenses of collection, to apply the net proceeds as provided in the Indenture. Mortgagor hereby authorizes and directs any such third Person to deliver such payment to Mortgagee in accordance with this Article III, and Mortgagor hereby ratifies and confirms all that its said attorney-in-fact, the Mortgagee, shall do or cause to be done in accordance with this Mortgage and by virtue of the powers granted hereby. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. (b) Mortgagor hereby constitutes and appoints Mortgagee the true and lawful attorney-in-fact, coupled with an interest, of Mortgagor and Mortgagor hereby confers upon Mortgagee the right, in the name, place and stead of Mortgagor, to subject and subordinate at any time and from time to time any Lease or any part thereof to the lien, assignment and security interest of this Mortgage and to the terms hereof, or to any other mortgage, deed of trust, assignment or security agreement, or to any ground lease or surface lease, with respect to all or a portion of the Mortgaged Property, or to request or require such subordination, where such reservation, option or authority was reserved to Mortgagor under any such Lease, or in any case where Mortgagor otherwise would have the right, power or privilege so to do. The foregoing appointment is irrevocable and continuing, and such rights, powers and privileges shall be exclusive in Mortgagee, and its successors and assigns, so long as any part of the Senior Secured Note Obligations remains unpaid or unperformed and undischarged. Mortgagor hereby represents and warrants that it has not at any time prior to the date hereof exercised (or appointed any Person as attorney-in-fact to exercise) any of the rights described in this Section 3.05, and Mortgagor hereby covenants not to exercise (or appoint any other Person as attorney-in-fact to exercise) any such right, nor (except at Mortgagee's written request) to subordinate any such Lease to the lien of this Mortgage or to any other mortgage, deed of trust, assignment or security agreement or to any ground lease or surface lease. 10 SECTION 3.06 No Liability of Mortgagee. Neither the acceptance hereof nor the exercise of the rights and remedies hereunder nor any other action on the part of Mortgagee or any Person exercising the rights of Mortgagee or any Holder hereunder shall be construed to: (a) be an assumption by Mortgagee or any such Person or to otherwise make Mortgagee or such Person liable or responsible for the performance of any of the obligations of Mortgagor under or with respect to the Leases or for any Rent, security deposit or other amount delivered to Mortgagor, provided that Mortgagee or any such Person exercising the rights of Mortgagee shall be accountable for any Rents, security deposits or other amounts actually received by Mortgagee or such Person, as the case may be; or (b) obligate Mortgagee or any such Person to take any action under or with respect to the Leases or with respect to the Mortgaged Property, to incur any expense or perform or discharge any duty or obligation under or with respect to the Leases or with respect to the Mortgaged Property, to appear in or defend any action or proceeding relating to the Leases or the Mortgaged Property, to constitute Mortgagee as a mortgagee-in-possession (unless Mortgagee actually enters and takes possession of the Mortgaged Property), or to be liable in any way for any injury or damage to Persons or property sustained by any Person in or about the Mortgaged Property, other than to the extent caused by the gross negligence or willful misconduct of Mortgagee or any Person exercising the rights of Mortgagee hereunder. SECTION 3.07 Mortgagor's Indemnities. Mortgagor hereby agrees to protect, indemnify and hold harmless Mortgagee and each Indemnified Party from and against any and all Losses which Mortgagee or Indemnified Party may incur under or by reason of this Article III, or for any action taken by Mortgagee or Indemnified Party hereunder, or by reason or in defense of any and all claims and demands whatsoever which may be asserted against Mortgagee or Indemnified Party arising out of the Leases, including, without limitation, any claim by any third Person for credit on account of Rents paid to and received by Mortgagor, but not delivered to Mortgagee or its agents, representatives or employees, for any period under any Lease more than one (1) month in advance of the due date thereof. The foregoing indemnity shall include, in any case, such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, but not any such Loss that is caused by the gross negligence or willful misconduct of Mortgagee or Indemnified Party. In the event that Mortgagee or any Indemnified Party incurs any Losses covered by the indemnity set forth in this Section 3.07, the amount thereof, including reasonable attorneys' fees, with interest thereon at the Default Rate, shall be payable by Mortgagor to Mortgagee within ten (10) days after demand therefor, and shall be secured hereby and by all other security for the payment and performance of the Senior Secured Note Obligations, including, without limitation, the lien and security interest of this Mortgage. The liabilities of Mortgagor as set forth in this Section 3.07 shall survive the termination of this Mortgage and the repayment of the Senior Secured Note Obligations. SECTION 3.08 No Modification of Mortgagor's Obligations. Nothing herein contained shall modify or otherwise alter the obligation of Mortgagor to make prompt payment of all Senior Secured Note Obligations as and when the same become due, regardless of whether the Rents described in this Article III are sufficient to pay the Senior Secured Note Obligations, and the security provided to Mortgagee pursuant to this Article III shall be cumulative of all other security of any and every character now or hereafter existing to secure payment of the Senior Secured Note Obligations. 11 ARTICLE IV REPRESENTATIONS AND WARRANTIES Mortgagor hereby unconditionally represents and warrants to Mortgagee as follows: SECTION 4.01 Title to Mortgaged Property and Lien of this Mortgage. Except as to Permitted Liens, Mortgagor has good, marketable and indefeasible fee simple title to the Land and the Buildings, and has good, marketable and indefeasible title to the Fixtures, the Personalty and the other Mortgaged Property. The Mortgaged Property is free and clear of any and all Liens, charges, encumbrances, security interests and adverse claims whatsoever, except for all Liens, charges, encumbrances, security interests and adverse claims specifically identified as exceptions in the policy of title insurance accepted by Mortgagee in connection herewith. SECTION 4.02 Taxes and Other Payments. All Federal and material foreign, state and local tax returns and other reports required by applicable law to be filed by it Mortgagor have been filed, or extensions have been obtained, and all taxes and other Impositions imposed upon Mortgagor or the Mortgaged Property and which have become due and payable on or prior to the date hereof have been paid, except such taxes, assessments and governmental charges in an aggregate amount not exceeding $0 or to the extent contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which adequate reserves, if any, have been set aside for the payment thereof on Mortgagor's financial statements to the extent required by and in accordance with GAAP. Mortgagor has no actual knowledge of any basis for any additional assessment or charge in respect of any such taxes or other Impositions. Mortgagor has paid or will pay in the ordinary course of business in full all sums owing or claimed for labor, material, supplies, personal property (whether or not forming a Fixture hereunder) and services of every kind and character used, furnished or installed in or on the Mortgaged Property. SECTION 4.03 Power to Create Lien and Security. Mortgagor has full power and lawful authority to grant, bargain, sell, assign, transfer, mortgage and convey a Lien and security interest in all of the Mortgaged Property in the manner and form herein provided and without obtaining the authorization, approval, consent or waiver of any grantor, lessor, sublessor, Governmental Authority or other Person whomsoever. SECTION 4.04 Senior Secured Note Documents and Indenture. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All representations and warranties made by Mortgagor in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby made by Mortgagor as to itself and the Mortgaged Property as though such representations and warranties were set forth at length herein as the representations and warranties of Mortgagor. SECTION 4.05 Compliance with Laws. All of the improvements on the Land (i) comply with all material requirements of all applicable laws and ordinances with respect to zoning, subdivision, construction, building and land use, including, without limitation, 12 requirements with respect to parking, access and certificates of occupancy (and similar certificates) and (ii) comply with, and shall remain in compliance with, applicable health, fire and building codes. All of the Buildings lie wholly within the boundaries and building restriction lines of the Land. No improvements on adjoining properties encroach upon the Land, and no easements or other encumbrances upon the Land encroach upon or under any of the Buildings or any portion of the Mortgaged Property. All of the Buildings and the use of the Mortgaged Property materially comply with, and shall remain in material compliance with, all applicable statutes, rules, regulations and private covenants now or hereafter relating to the ownership, construction, use or operation of the Mortgaged Property, including all applicable statutes, rules and regulations pertaining to requirements for equal opportunity, anti-discrimination, fair housing, environmental protection, zoning and land use. All certifications, permits, licenses and approvals, including, without limitation, certificates of completion and occupancy permits required for the legal use, occupancy and operation of the Mortgaged Property have been obtained and are in full force and effect. Mortgagor has not received any notice of, or other communication with respect to, an alleged violation with respect to any of the foregoing. SECTION 4.06 No Condemnation. No part of any property subject to this Mortgage has been taken in condemnation or other like proceeding nor is any proceeding pending, threatened or known to be contemplated for the partial or total condemnation or taking of the Mortgaged Property. SECTION 4.07 Flood Zone. The Land is not located in an area identified by the Federal Emergency Management Agency ("FEMA") as having special flood hazards or if the Land or any part thereof is identified by the Federal Emergency Management Agency as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), then Mortgagor has obtained the insurance required under Section 5.04(a)(v) of this Mortgage. ARTICLE V AFFIRMATIVE COVENANTS Mortgagor hereby unconditionally covenants and agrees with Mortgagee as follows: SECTION 5.01 Lien Status. Except as otherwise expressly provided in the Indenture, Mortgagor shall not place, or permit to be placed, or otherwise mortgage, hypothecate or encumber the Mortgaged Property, or any portion thereof or interest therein, with any other Lien or security interest of any nature whatsoever (statutory, constitutional or contractual), other than Permitted Liens, regardless of whether such Lien or security interest is inferior to the Lien and security interest created by this Mortgage, and, if any such Lien or security interest is asserted against the Mortgaged Property, Mortgagor shall promptly, at its own cost and expense, (a) pay the underlying claim in full (except for so long as such claim is being contested by Mortgagor in good faith and as and to the extent permitted in accordance with the terms of the Indenture) or take such other action as may be necessary to cause the same to be released of record and otherwise, and (b) within five (5) days after the date on which such Lien or security 13 interest is so asserted, give Mortgagee notice of such Lien or security interest. Such notice shall specify who is asserting such Lien or security interest and shall detail the origin and nature of the underlying claim giving rise to such asserted Lien or security interest. SECTION 5.02 Payment of Impositions. Mortgagor shall duly pay and discharge, or cause to be paid and discharged, all Impositions not later than the due date thereof, or the day on which any fine, penalty, interest or cost may be added thereto or imposed, or the day on which any Lien may be filed for the nonpayment thereof (if such day is used to determine the due date of the respective item); provided, however, that Mortgagor may, if permitted by applicable law and if such installment payment would not create or permit the filing of a Lien against the Mortgaged Property, pay the Impositions in installments. Notwithstanding the foregoing, Mortgagor may in good faith, by appropriate proceedings and upon notice to Mortgagee, contest the validity, applicability or amount of any asserted tax or assessment, subject to any more restrictive provisions applicable to any such contest contained in the Indenture and (without limiting the foregoing) so long as (a) such contest is diligently pursued, (b) Mortgagee determines, in its opinion reasonably exercised, that such contest suspends the obligation to pay the tax and that nonpayment of such tax or assessment will not result in the sale, loss, forfeiture or diminution of the Mortgaged Property or any part thereof or any interest of Mortgagee therein, and (c) unless expressly provided to the contrary in the Indenture, prior to the earlier of the commencement of such contest or the delinquency date of the asserted tax or assessment, Mortgagor deposits with Mortgagee an amount determined by Mortgagee to be adequate to cover the payment of such tax or assessment and a reasonable additional sum to cover possible interest, costs and penalties; provided, however, that Mortgagor shall promptly cause to be paid any amount adjudged by a court of competent jurisdiction to be due, with all interest, costs and penalties thereon, promptly after such judgment becomes final (and, subject to Mortgagee's rights and remedies during an Event of Default, Mortgagee shall make any sum deposited pursuant to clause (c) above available for such payment); and provided, further, that in any event each such contest shall be concluded, the taxes, assessments, interest, costs and penalties shall be paid prior to the date any writ or order is issued under which the Mortgaged Property may be sold, lost or forfeited. SECTION 5.03 Repair. Mortgagor shall keep the Mortgaged Property in good order and condition (reasonable wear and tear excepted) and shall make all repairs, replacements and improvements thereof and thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, which are necessary to keep the same in such order and condition. Mortgagor shall also use reasonable efforts to prevent any act or occurrence which might impair the value or usefulness of the Mortgaged Property for its intended usage. SECTION 5.04 Insurance and Application of Insurance Proceeds. (a) During the term of this Mortgage, Mortgagor, at its sole cost and expense, shall maintain, or cause to be maintained the following policies of insurance, with respect to the Mortgaged Property: (i) Casualty (property) insurance against loss or damage by fire, lightning and such other perils as are included in a standard "special form" policy (formerly known as an "all-risk" endorsement policy), and against loss or damage by all 14 other risks and hazards covered by a standard extended coverage insurance policy including, without limitation, riot and civil commotion, terrorist actions, vandalism, malicious mischief, burglary and theft, in an amount equal to the greater of (A) the then full replacement cost of the improvements, without deduction for physical depreciation and (B) such amount that the insurer would not deem Mortgagor a co-insurer under said policies. The policies of insurance required under this Section 5.04 shall contain a "Replacement Cost" endorsement with a waiver of depreciation and an "Agreed Amount" or "No Coinsurance" endorsement and shall otherwise comply with the Indenture. (ii) Commercial General Liability insurance, including a broad form comprehensive general liability endorsement and coverages for broad form property damage, contractual damages and personal injuries (including death resulting therefrom) and containing minimum limits per occurrence of $1,000,000.00 and $2,000,000.00 in the aggregate for any policy year with no deductible. (iii) Rental loss and/or business interruption insurance in an amount equal to the estimated gross revenues from the operations of the Mortgaged Property for a period of twelve (12) months. (iv) Insurance against loss or damage from (A) leakage of sprinkler systems and (B) explosion of steam boilers, air conditioning equipment, high pressure piping, machinery and equipment, pressure vessels or similar apparatus now or hereafter installed on the improvements (without exclusion for explosions). (v) Flood insurance if all or any portion of the Mortgaged Property is located in an area now or hereafter designated by the Federal Emergency Management Agency, as an area having special flood hazards (including, without limitation, those areas designated as Zone A or Zone V), and in which flood insurance has been made available under the U.S. National Flood Insurance Program, in an amount equal to the full replacement cost of the Buildings, Fixtures and Personalty now or hereafter located on the Mortgaged Property or such other amount as may be agreed to by Mortgagee in writing. (vi) If the Mortgaged Property is or ever becomes non-conforming with respect to zoning, ordinance or law coverage to compensate for loss of value or property resulting from operation of law and the cost of demolition and the increased cost of construction in such amounts as may be requested by Mortgagee. (vii) Any other insurance with respect to the Mortgaged Property that may be required under the Indenture. (viii) Such other insurance as may from time to time be reasonably required by Mortgagee in order to protect its interests. (b) All such insurance policies with respect to the Mortgaged Property shall contain a standard, non-contributory mortgagee clause naming Mortgagee and its successors and assigns, as an additional insured under all liability insurance policies, as the mortgagee and loss 15 payee on all property insurance policies, and as the sole loss payee on all rental loss or business interruption insurance policies. Mortgagor shall not take out separate insurance with respect to the Mortgaged Property concurrent in form or contributing in the event of loss with that required to be maintained hereunder or under the Indenture unless Mortgagee is named an additional insured thereon under a standard mortgagee clause acceptable to Mortgagee and each such policy is otherwise in form and substance acceptable to Mortgagee. (c) In the event of the foreclosure of this Mortgage, or in the event of any transfer of title to the Mortgaged Property, or any part thereof, by foreclosure sale or by power of sale or deed in lieu of foreclosure, the purchaser of the Mortgaged Property, or such part thereof, shall succeed to all of Mortgagor's rights with respect to the Mortgaged Property, including any rights to unexpired, unearned or returnable insurance premiums, subject to limitations on the assignment of blanket policies, but limited to such rights as relate to the Mortgaged Property or such part thereof. If Mortgagee acquires title to the Mortgaged Property, or any part thereof, in any manner, Mortgagee shall thereupon (as between Mortgagor and Mortgagee) become the sole and absolute owner of the insurance policies with respect to the Mortgaged Property, and all insurance proceeds payable thereunder with respect to the Mortgaged Property, with the sole right to collect and retain all unearned or returnable premiums thereon with respect to the Mortgaged Property, or such part thereof, if any. (d) If any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property shall occur, Mortgagor shall file and prosecute its claim or claims for any insurance proceeds in good faith and with due diligence and cause the same to be collected and paid over to Mortgagee, and Mortgagor hereby irrevocably authorizes and empowers Mortgagee, in the name of Mortgagor or otherwise, to collect and receipt for any such insurance proceeds and to adjust any insurance claims and to file and prosecute such claim or claims, and although it is hereby expressly agreed that the same shall not be necessary in any event, Mortgagor shall, upon demand of Mortgagee, make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assigning any such insurance proceeds to Mortgagee, free and clear of any Liens whatsoever. Mortgagor hereby irrevocably appoints Mortgagee as Mortgagor's attorney-in-fact for each such purpose (which appointment is coupled with an interest) and authorizes any Person to act upon the foregoing appointment. (e) Following any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagee shall apply the entire amount of any insurance proceeds in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same are to be applied, then Mortgagee shall apply the entire amount thereof to the payment of the Senior Secured Note Obligations, whether or not then due and payable, in such manner and order as Mortgagee may elect, unless expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to promptly commence and to diligently prosecute the restoration of the Mortgaged Property upon the occurrence of any casualty loss affecting the Mortgaged Property, without regard to the availability or adequacy of insurance proceeds, but in all events in a manner approved by Mortgagee. Notwithstanding any damage to, destruction or loss of or other casualty with respect to any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents until the Senior Secured Note Obligations have been paid in full. If 16 the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such insurance proceeds, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such insurance proceeds, or a portion thereof sufficient to pay the then unpaid Senior Secured Note Obligations, whichever is less. SECTION 5.05 Condemnation and Application of Condemnation Proceeds. (a) Promptly upon its obtaining knowledge of the institution or the threatened institution of any proceeding for the condemnation or other taking of the Mortgaged Property, or any portion thereof or interest therein, Mortgagor shall notify Mortgagee of such proceeding. Mortgagor shall then, if requested by Mortgagee, file or defend its claim thereunder and prosecute same with due diligence to its final disposition and shall, subject to the terms of the Indenture, cause any awards or settlements to be paid over to Mortgagee for disposition pursuant to the terms of this Mortgage. Mortgagee shall be entitled to participate in any such proceeding, at Mortgagor's sole cost and expense, and Mortgagor shall deliver or cause to be delivered to Mortgagee such instruments as may be requested by Mortgagee from time to time to permit such participation. (b) If the Mortgaged Property or any part thereof is taken or diminished in value, or if a consent settlement is entered by or under threat of such proceeding, the award or settlement payable to Mortgagor by virtue of its interest in the Mortgaged Property shall be, and by these presents is, assigned, transferred and set over unto Mortgagee to be held by Mortgagee, subject to the Lien and security interest of this Mortgage, and disbursed in accordance with the provisions of the Indenture or, if there is no provision contained in the Indenture governing how the same is to be disbursed, then Mortgagee shall apply the entire amount thereof (i) in the event of a partial taking, first to the restoration of that part of the Mortgaged Property not taken and then to the payment of the Senior Secured Note Obligations, and (ii) in the event of a total taking, to the payment of the Senior Secured Note Obligations, in both cases of (i) and (ii), whether or not then due and payable, in such manner and order as Mortgagee may elect. In all events, unless otherwise expressly provided to the contrary in the Indenture, Mortgagor hereby covenants and agrees to commence and diligently to prosecute the restoration of the Mortgaged Property upon the occurrence of any condemnation or other taking affecting the Mortgaged Property, without regard to the availability or adequacy of any award or settlement. Notwithstanding any condemnation or other taking of any of the Mortgaged Property, Mortgagor shall continue to pay the Senior Secured Note Obligations at the time and in the manner provided for in the Indenture and the other Senior Secured Note Documents, and the Senior Secured Note Obligations shall not be reduced until, and then only to the extent that, any condemnation award or settlement shall have been actually received and applied by Mortgagee to the discharge of the Senior Secured Note Obligations. If the Mortgaged Property is sold, through foreclosure or otherwise, prior to the receipt by Mortgagee of such condemnation award or settlement, Mortgagee shall have the right, whether or not a deficiency judgment on any Senior Secured Note Document shall have been sought, recovered or denied, to receive such condemnation award or settlement, or a portion thereof sufficient to pay the Senior Secured Note Obligations, whichever is less. 17 SECTION 5.06 Maintenance of Rights-of-Way, Easements, Licenses and Other Rights. Mortgagor shall maintain, preserve and renew all rights-of-way, easements, tenements, hereditaments, development rights and credits, zoning rights, grants, privileges, appurtenances, licenses, franchises and other rights reasonably necessary for the use or operation of the Mortgaged Property from time to time, or otherwise relevant to the value thereof, and Mortgagor shall not, without the prior written consent of Mortgagee, initiate, join in or consent to any private restrictive covenant or other public or private restriction as to the present or future use or operation of the Mortgaged Property. Mortgagor shall, however, comply with all restrictive covenants which may at any time affect the Mortgaged Property, all applicable zoning ordinances and all other public or private restrictions relating to the use of the Mortgaged Property. SECTION 5.07 Payment and Performance of Senior Secured Note Obligations. Mortgagor shall duly and punctually pay and perform all of the Senior Secured Note Obligations as and to the extent and in the manner set forth in the Indenture. SECTION 5.08 Compliance with Permitted Liens and Other Senior Secured Note Obligations. Mortgagor shall comply in all material respects with any and all Senior Secured Note Obligations, restrictions and requirements that may be set forth in each and every document constituting a Permitted Lien as and to the extent and in the manner set forth in the Indenture. In addition, Mortgagor shall comply in all material respects with each and every obligation legally imposed upon it and/or relating to the Mortgaged Property pursuant to applicable law (including, without limitation, all matters described in Section 4.05 hereof), contract or other agreement. It is hereby acknowledged that Mortgagee's consent to a Permitted Lien as of the date hereof shall in no way be deemed to constitute approval of any future Lien which may be imposed upon any portion of the Mortgaged Property, or any other enforcement action affecting Mortgagor or the Mortgaged Property, as a result of Mortgagor's failure to perform or comply with its Senior Secured Note Obligations under any document constituting a Permitted Lien as of the date hereof. SECTION 5.09 Additional Affirmative Covenants. All affirmative covenants made by the Parent or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such affirmative covenants were set forth at length herein as the affirmative covenants of Mortgagor. ARTICLE VI NEGATIVE COVENANTS Mortgagor hereby covenants and agrees with Mortgagee that, until all of the Senior Secured Note Obligations shall have been paid or performed in full and discharged: SECTION 6.01 Use Violations. Mortgagor shall not use, maintain, operate or occupy, or allow the use, maintenance, operation or occupancy of, the Mortgaged Property in any manner which (a) violates in any material respect any Governmental Requirement, (b) may be dangerous unless safeguarded as required by applicable law, (c) constitutes a public or private 18 nuisance, or (d) makes void, voidable or cancelable, or increases, substantially in excess of commercially reasonably rates, the premium of, any insurance then in force with respect thereto. SECTION 6.02 Waste. Mortgagor shall not commit or permit any waste with respect to the Mortgaged Property. SECTION 6.03 Alterations. Mortgagor shall notify Mortgagee, in writing and in advance, with respect to all proposed alterations, improvements or additions to the Mortgaged Property which are of a material nature, and, unless and to the extent otherwise expressly provided in the Indenture, Mortgagor shall not effect any material alteration, improvement or addition to the Mortgaged Property without the prior written consent of Mortgagee. SECTION 6.04 No Further Encumbrances. Mortgagor shall not, without the prior written consent of Mortgagee, create, place or permit to be created or placed, or through any act or failure to act, acquiesce in the placing of, or allow to remain, any mortgage, pledge, Lien (statutory, constitutional or contractual), security interest, encumbrance or charge on, or conditional sale or other title retention agreement with respect to, the Mortgaged Property, or any portion thereof or interest therein, other than the Permitted Liens, regardless of whether the same are subordinate to the Lien(s) and security interest(s) created by this Mortgage. SECTION 6.05 Transfer Restrictions. Mortgagor shall not sell, lease, assign, transfer or otherwise dispose of or abandon all or any part of the Mortgaged Property (or any interest therein), except as expressly permitted by, and in accordance with the terms of, the Indenture. SECTION 6.06 Senior Secured Note Documents and Indenture; Additional Negative Covenants. Mortgagor has received a copy of and is fully familiar with the terms and provisions of the Indenture and the other Senior Secured Note Documents. All negative covenants made by the Obligors or Guarantors or any of them in the Indenture and the other Senior Secured Note Documents are incorporated herein by reference and are hereby also made by Mortgagor as to itself and the Mortgaged Property as though such negative covenants were set forth at length herein as the negative covenants of Mortgagor. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES SECTION 7.01 Event of Default. The "Events of Default" set forth in Section 6.01 of the Indenture are hereby incorporated herein as if fully set forth herein, and, without limiting the generality of the foregoing, the occurrence of an "Event of Default" under the Indenture or any other Senior Secured Note Document shall constitute an "Event of Default" hereunder. SECTION 7.02 Acceleration. Upon the occurrence and during the continuance of any Event of Default, in addition to any other rights, powers or remedies conferred herein or by operation of law, Mortgagee, in its sole judgment and discretion, may declare the then unpaid principal balance remaining under the Notes (the "Principal Balance"), the accrued interest thereon and any other accrued but unpaid portion of the Senior Secured Note Obligations to be, and they shall thereupon forthwith become, immediately due and payable without presentment, 19 demand, protest or other notice of any kind, all of which are hereby expressly waived by Mortgagor. SECTION 7.03 Foreclosure and Sale. If an Event of Default shall occur and be continuing, Mortgagee shall have the right and option to take possession of the Mortgaged Property and/or proceed with foreclosure and to sell, to the extent and in the manner permitted by applicable law, all or any portion of the Mortgaged Property at one or more sales, as an entirety or in parcels, at such place or places, in such manner and upon such notice as may be required by applicable law, or, in the absence of any such requirement, as Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers. Where the Mortgaged Property is situated in more than one county, notice as above provided shall be posted and filed in all such counties (if such notices are required by applicable law), and all such Mortgaged Property may be sold in any such county and any such notice shall designate the county where such Mortgaged Property is to be sold. Nothing contained in this Section 7.03 shall be construed so as to limit in any way Mortgagee's rights to sell the Mortgaged Property, or any portion thereof, by private sale if, and to the extent that, such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. Mortgagor hereby irrevocably appoints Mortgagee to be the attorney-in-fact of Mortgagor (coupled with an interest) and in the name and on behalf of Mortgagor to execute and deliver any deeds, transfers, conveyances, assignments, assurances and notices which Mortgagor ought to execute and deliver, and to do and perform any other acts or things which Mortgagor ought to do and perform under the covenants herein contained and, generally, to use the name of Mortgagor in the exercise of any of the powers hereby conferred on Mortgagee. At any such sale: (a) whether made under the power herein contained or any other legal enactment, or by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for Mortgagee to have physically present, or to have constructive possession of, the Mortgaged Property (Mortgagor hereby covenanting and agreeing to deliver to Mortgagee any portion of the Mortgaged Property not actually or constructively possessed by Mortgagee immediately upon demand by Mortgagee) and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale; (b) each instrument of conveyance executed by Mortgagee shall contain a general warranty of title, binding upon Mortgagor and its successors and assigns; (c) each and every recital contained in any instrument of conveyance made by Mortgagee shall conclusively establish the truth and accuracy of the matters recited therein, including, without limitation, nonpayment and/or nonperformance of the Senior Secured Note Obligations and advertisement and conduct of such sale in the manner provided herein and otherwise required by applicable law; (d) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed; (e) the receipt of Mortgagee, or of such other Person or officer making the sale, shall be a sufficient discharge to the purchaser for its purchase money and neither such purchaser nor its assigns or personal representatives shall thereafter be obligated to see to the application of such purchase money, or be in any way answerable for any loss, misapplication or non-application thereof; (f) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, estate, claim and demand whatsoever, either at law or in equity (including any statutory or common law right of redemption, which is hereby waived to the fullest extent permitted by applicable law), in and to the property sold in any such event, and such sale shall be a perpetual bar, both at law and in equity, against Mortgagor and any and all 20 other Persons claiming by, through or under Mortgagor; and (g) to the extent and under such circumstances as are permitted by applicable law, Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the then unpaid Senior Secured Note Obligations to the amount of its bid (in the order of priority set forth in Section 7.16 hereof) in lieu of cash payment. Each remedy provided in this instrument is distinct from and cumulative with all other rights and remedies provided hereunder or afforded by applicable law or equity, and may be exercised concurrently, independently or successively, in any order whatsoever. SECTION 7.04 Mortgagee's Agents. Mortgagee may appoint or delegate any one or more Persons as agent to perform any act or acts necessary or incident to any sale held by Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of Mortgagee. SECTION 7.05 Judicial Foreclosure. If any Event of Default shall occur and be continuing, Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Mortgaged Property under the judgment or decree of any court or courts of competent jurisdiction, or for the enforcement of any other appropriate legal or equitable remedy. SECTION 7.06 Receiver. If any Event of Default shall occur and be continuing, Mortgagee may apply for and obtain as a matter of right and without notice to Mortgagor, which notice is hereby expressly waived by Mortgagor, the appointment of a receiver to collect the Rents of the Mortgaged Property and to preserve the security hereof, either before or after any foreclosure sale or the sale of the Mortgaged Property under the order of a court or courts of competent jurisdiction or under executory or other legal process, without regard to the value of the Mortgaged Property as security for the amount then due to Mortgagee, or the solvency of any entity or entities, person or persons primarily or secondarily liable for the payment of such amounts; the Rents of the Mortgaged Property, in any such event, having heretofore been assigned to Mortgagee pursuant to Section 3.01 as additional security for the payment of the Senior Secured Note Obligations secured hereby. Any money advanced by Mortgagee in connection with any such receivership shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall be subject to the provisions of Section 8.07(b) hereof. SECTION 7.07 Foreclosure for Installments. To the extent allowed by applicable law, Mortgagee shall also have the option to proceed with foreclosure in satisfaction of any installments of the Senior Secured Note Obligations which have not been paid when due, either through the courts or otherwise, by non-judicial power of sale in satisfaction of the matured but unpaid portion of the Senior Secured Note Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire principal balance and accrued interest due. Such sale may be made subject to the unmatured portion of the Senior Secured Note Obligations, and any such sale shall not in any manner affect the unmatured portion of the Senior Secured Note Obligations, but as to such unmatured portion of the Senior Secured Note Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed that several sales may be made hereunder without 21 exhausting the right of sale for any unmatured part of the Senior Secured Note Obligations, it being the intent and purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Senior Secured Note Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Senior Secured Note Obligations. SECTION 7.08 Separate Sales. To the extent allowed by applicable law, the Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee, in its sole discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. SECTION 7.09 Possession of Mortgaged Property. Mortgagor agrees to the full extent that it lawfully may, that, in case one or more of the Events of Default shall have occurred and be continuing, then, and in every such case, Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Mortgaged Property in the possession of Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude Mortgagor, its successors or assigns, and all Persons claiming by, through or under Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, Mortgagee may use, administer, manage, operate and control the Mortgaged Property and conduct the business thereof to the same extent as Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of Mortgagor, in the name, place and stead of Mortgagor, or otherwise as Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by Mortgagee in administering, managing, operating and controlling the Mortgaged Property shall constitute a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee. Mortgagor hereby irrevocably constitutes and appoints Mortgagee as Mortgagor's attorney-in-fact (coupled with an interest) to perform such acts and execute such documents as Mortgagee, in its sole discretion, shall deem appropriate, including endorsement of Mortgagor's name on any instruments. Regardless of any provision of this Mortgage, the Indenture or any other Senior Secured Note Document, Mortgagee shall not be considered to have accepted any property other than cash or immediately available funds in satisfaction of any obligation of Mortgagor to Mortgagee, unless Mortgagee shall have given express written notice of Mortgagee's election to the contrary. SECTION 7.10 Occupancy After Acceleration. In the event that there is an acceleration of the amounts due under the Notes and Mortgagor or Mortgagor's representatives, successors or assigns or any other Person claiming any interest in the Mortgaged Property by, through or under Mortgagor, continues to occupy or use the Mortgaged Property or any part thereof, each and all shall immediately become the tenant of Mortgagee (or its successor, if applicable), which tenancy shall be a tenancy from day-to-day, terminable at the will of either the landlord or tenant, at a rent to be determined by Mortgagee (which may be in excess of fair market value); provided, however, that until Mortgagee sets forth the amount of such rent, such rent shall be a fair market rental per day based upon the value of the Mortgaged Property as a whole; and such rental shall be due daily to the Mortgagee (or its successor, if applicable). To the extent permitted by applicable law, Mortgagee (or its successor, if applicable), notwithstanding any language herein to the contrary, shall have the sole option to demand immediate possession or to permit the occupants to remain as tenants at will. In the event that the tenant fails to surrender possession of said property upon demand, Mortgagee (and its 22 successor, if applicable) shall be entitled to institute and maintain a summary action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having appropriate jurisdiction. SECTION 7.11 Remedies Cumulative, Concurrent and Nonexclusive. Every right, power and remedy herein given to Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute (including specifically those granted by the Applicable UCC). Each such right, power and remedy, whether specifically herein given or otherwise existing, may be exercised from time to time and so often and in such order as may be deemed expedient by Mortgagee, and the exercise, or the beginning of the exercise, of any such right, power or remedy shall not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. Mortgagee shall be entitled to collect all costs and expenses incurred in pursuing such remedies. No delay or omission by Mortgagee in the exercise of any such right, power or remedy shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. SECTION 7.12 No Release of Senior Secured Note Obligations. Neither Mortgagor, any other Obligor or any of the Guarantors, nor any other Person now or hereafter obligated for the payment or performance of all or any part of the Senior Secured Note Obligations shall be relieved of any such obligation by reason of (a) the failure of Mortgagee, to comply with any request of Mortgagor, any other Obligor, any of the Guarantors or any Obligor, Guarantor or other Person so obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Indenture; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this Mortgage without first having obtained the consent of, given notice to or paid any consideration to Mortgagor, any other Obligor or any of the Guarantors, Obligor or any other Person, and in any such event Mortgagor, all other Obligors, all Guarantors and all such other Persons shall continue to be liable to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by Mortgagee; or (d) any other act or occurrence save and except the complete payment and performance of all of the Senior Secured Note Obligations. SECTION 7.13 Release of and Resort to Collateral. Mortgagee may release, regardless of consideration, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien or security interest created in or evidenced by this Mortgage or its stature as a Lien and security interest in and to the Mortgaged Property, and without in any way releasing or diminishing the liability of any Person liable for the payment or performance of the Senior Secured Note Obligations. Mortgagee may resort to any other security for the Senior Secured Note Obligations held by Mortgagee in such manner and order as Mortgagee may elect. SECTION 7.14 Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to Mortgagor by virtue of any present or 23 future moratorium law or other law exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) except for notices expressly provided for herein or in the Indenture, all notices of any Event of Default or of Mortgagee's intention to accelerate maturity of the Senior Secured Note Obligations or of Mortgagee's election, to exercise or actual exercise of any right, remedy or recourse provided for hereunder or under the Indenture; and (c) any right to a marshalling of assets or a sale in inverse order of alienation; and (d) any and all conflicts with any provisions of any of the Senior Secured Note Documents. If any law referred to in this Mortgage and now in force, of which Mortgagor or its successor or successors might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of the provisions hereof. SECTION 7.15 Discontinuance of Proceedings. In case Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under the Indenture and shall thereafter elect to discontinue or abandon same for any reason, Mortgagee shall have the unqualified right so to do and, in such an event, Mortgagor and Mortgagee shall be restored to their former positions with respect to the Senior Secured Note Obligations, this Mortgage, the Indenture, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee shall continue as if same had never been invoked. SECTION 7.16 Application of Proceeds. After the occurrence and during the continuance of an Event of Default, the proceeds of any sale of and any other amounts generated by the holding, leasing, operating or other use of the Mortgaged Property shall be applied by Mortgagee (or the receiver, if one is appointed), to the extent that funds are so available therefrom, in accordance with the provisions of the Indenture or, if not so provided, then in the following order of priority, except to the extent otherwise required by applicable law: (a) first, to the payment of the reasonable and necessary costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving the same, including reasonable (i) receivers' fees, (ii) court costs, (iii) attorneys' and accountants' fees, (iv) costs of advertisement and title search fees, and (v) the payment of any and all Impositions, Liens, security interests or other rights, titles or interests equal or superior to the Lien and security interest of this Mortgage (except those to which the Mortgaged Property has been sold subject to and without in any way implying Mortgagee's prior consent to the creation thereof); (b) second, to the payment of all amounts other than the Principal Balance and accrued but unpaid interest which may be due to Mortgagee or Collateral Agent, as applicable, hereunder or under the other Senior Secured Note Documents, together with interest thereon as provided herein; (c) third, to the payment of the Senior Secured Note Obligations in such order and manner as Mortgagee determines in its sole discretion; and (d) fourth, to Mortgagor or as otherwise required by any Governmental Requirement. Mortgagor shall be liable for any deficiency remaining. 24 SECTION 7.17 Uniform Commercial Code Remedies. Mortgagee shall have all of the rights, remedies and recourses with respect to the Personalty and the Fixtures afforded to it by the Applicable UCC, including, without limitation, the right to take possession of the Personalty and the Fixtures or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personalty and the Fixtures, in addition to, and not in limitation of, the other rights, remedies and recourses afforded by this Mortgage and the other Senior Secured Note Documents. SECTION 7.18 Indemnity. In connection with any action taken by Mortgagee or any other Indemnitee pursuant to this Mortgage, neither Mortgagee, or any Indemnified Parties shall be liable for any Loss sustained by Mortgagor resulting from (a) an assertion that Mortgagee or an Indemnified Party has received funds from the operations of the Mortgaged Property claimed by third Persons, or (b) any act or omission of Mortgagee, or any such Indemnified Party in administering, managing, operating or controlling the Mortgaged Property, including in either case such Loss as may result from the ordinary negligence of Mortgagee or Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person, nor shall Mortgagee and or an Indemnified Party be obligated to perform or discharge any obligation, duty or liability of Mortgagor. Mortgagor shall and does hereby agree to indemnify Mortgagee, and each of the other Holders and their respective Indemnified Parties for, and to hold Mortgagee, and each such other Holder and each Indemnified Party harmless from, any and all Losses which may or might be incurred by Mortgagee, or any of such other Holders or Indemnified Parties by reason of this Mortgage or the exercise of rights or remedies hereunder, including such Losses as may result from the ordinary negligence of Mortgagee, or any other Holder or an Indemnified Party, or which may result from strict liability, whether under applicable law or otherwise, unless such Loss is caused by the gross negligence, willful misconduct or bad faith of such Person. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO MORTGAGEE AND EACH INDEMNIFIED PERSON WITH RESPECT TO LOSSES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF MORTGAGEE, SUCH INDEMNIFIED PERSON OR ANY OTHER PERSON. Should Mortgagee, and/or other Holder or an Indemnified Party make any expenditure on account of any such Losses, the amount thereof, including costs, expenses and reasonable attorneys' fees, shall be a demand obligation (which obligation Mortgagor hereby expressly promises to pay) owing by Mortgagor to Mortgagee and shall bear interest from the date expended until paid at the Default Rate, shall be a part of the Senior Secured Note Obligations and shall be secured by this Mortgage and the other Senior Secured Note Documents. Mortgagor hereby assents to, ratifies and confirms any and all actions of Mortgagee with respect to the Mortgaged Property taken under this Mortgage. The liabilities of Mortgagor, as set forth in this Section 7.18, shall survive the termination of this Mortgage and the payment and performance of the Senior Secured Note Obligations. ARTICLE VIII MISCELLANEOUS SECTION 8.01 Instrument Construed as Mortgage, Etc. This Mortgage may be construed as a mortgage, deed of trust, chattel mortgage, conveyance, assignment, security 25 agreement, pledge, financing statement, hypothecation or contract, or any one or more of them, in order to fully effectuate the liens and security interests created hereby and the purposes and agreements set forth herein. SECTION 8.02 Performance at Mortgagor's Expense. The cost and expense of performing or complying with any and all of the Senior Secured Note Obligations shall be borne solely by Mortgagor, and no portion of such cost and expense shall be, in any way or to any extent, credited against any installment on or portion of the Senior Secured Note Obligations. SECTION 8.03 Survival of Senior Secured Note Obligations. Each and all of the Senior Secured Note Obligations shall survive the execution and delivery of this Mortgage and shall continue in full force and effect until all of the Senior Secured Note Obligations shall have been fully satisfied. SECTION 8.04 Further Assurances. Mortgagor, upon the request of Mortgagee, shall execute, acknowledge, deliver and record and/or file such further instruments, including financing statements, and do such further acts as may be reasonably necessary, desirable or proper to carry out more effectively the purpose of this Mortgage and to subject to the Liens and security interests hereof any property intended by the terms hereof to be covered hereby, including any renewals, additions, substitutions, replacements, betterments or appurtenances to the then Mortgaged Property. SECTION 8.05 Notices. All notices or other communications required or permitted to be given pursuant to this Mortgage shall be in writing and shall be considered properly given if given in the manner and to the addresses prescribed by Section 13.02 of the Indenture to the parties and at the addresses set forth in the first paragraph of this Mortgage, and to the parties at the addresses set forth in Section 13.02 of the Indenture; provided, however, that (a) service of notice as required by the laws of any State or Commonwealth in which portions of the Mortgaged Property may be situated shall for all purposes be deemed appropriate and sufficient with the giving of such notice thereunder, and (b) any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of ten (10) days' notice to the other party in the manner set forth above. SECTION 8.06 No Waiver. Any failure by Mortgagee to insist, or any election by Mortgagee not to insist, upon strict performance by Mortgagor of any of the terms, provisions or conditions of this Mortgage shall not be deemed to be a waiver of the same or of any other terms, provision or condition hereof, and Mortgagee shall have the right, at any time or times thereafter, to insist upon strict performance by Mortgagor of any and all of such terms, provisions and conditions. Mortgagee may, in Mortgagee's sole and absolute discretion, (i) in the case of a Default, determine whether such Default has been cured, and (ii) in the case of an Event of Default, accept or reject any proposed cure of an Event of Default. In no event shall any provision of this Mortgage or any other Senior Secured Note Document which provides that Mortgagee shall have certain rights and/or remedies only during the continuance of an Event of Default be construed so as to require Mortgagee to accept a cure of any such Event of Default. Unless and until Mortgagee accepts any proposed cure of an Event of Default, such Event of Default shall be deemed to be continuing for purposes of this Mortgage and the other Senior Secured Note Documents. 26 SECTION 8.07 Mortgagee's Right to Perform as Mortgagee's Expenditures. (a) Mortgagor agrees that if Mortgagor fails to perform any act or take any action which Mortgagor is required to perform or take hereunder or under the Indenture or to pay any money which Mortgagor is required to pay hereunder or under the Indenture, Mortgagee may, after prior notice to Mortgagor and reasonable opportunity to cure except in cases of emergency, but shall not be obligated to, perform or cause to be performed such act or take such action or pay such money. (b) All costs and expenses incurred by Mortgagee (or any Indemnified Party), including, without limitation, attorneys fees and expenses, all monies paid by (or on behalf of) Mortgagee and the monetary value of all services performed by (or on behalf of Mortgagee) in connection with a Default or Event of Default hereunder or under any other Senior Secured Note Document, including, without limitation, the (i) the enforcement of any term or provision of this Mortgage or any other Senior Secured Note Document, (ii) the performance by Mortgagee of any obligation of Mortgagor under this Mortgage or any other Senior Secured Note Document if Mortgagee elects to so perform, in its sole and absolute discretion, and (iii) any action Mortgagee elects to take, in its sole and absolute discretion, to protect its interest in or the value of the Mortgaged Property, shall be a demand obligation owing by Mortgagor to Mortgagee, as the case may be, and to the extent any payment is made to a third Person, Mortgagee, upon making such payment, shall be subrogated to all of the rights of the Person receiving such payment. All such costs and expenses, monies and the monetary value of such services performed shall (x) bear interest at the Default Rate from the date of such incurrence, payment or performance, as applicable, until paid, and (y) constitute (together with such interest) a portion of the Senior Secured Note Obligations and shall be secured by this Mortgage and all of the other Senior Secured Note Documents. If Mortgagee shall elect to pay any Imposition or other sums due with reference to the Mortgaged Property, Mortgagee may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof. SECTION 8.08 Successors and Assigns. All of the terms hereof shall apply to, be binding upon and inure to the benefit of the parties hereto, their successors, assigns, heirs and legal representatives, and all other Persons claiming by, through or under them; provided, however, that nothing herein shall be deemed to imply any right on behalf of Mortgagor to assign its interest in any of the Mortgaged Property except as may be expressly set forth in the Indenture. SECTION 8.09 Severability. This Mortgage is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws and regulations of applicable Governmental Authorities and the provisions hereof are intended to be limited to the extent necessary that they will not render this Mortgage invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any applicable law. If any provision hereof or the application thereof to any Person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Mortgage nor the application of such provision to other Persons or circumstances shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law. 27 SECTION 8.10 Entire Agreement and Modification. This Mortgage may not be amended, revised, waived, discharged, released or terminated orally, but only by a written instrument or instruments executed by the party against which enforcement of the amendment, revision, waiver, discharge, release or termination is asserted. Any alleged amendment, revision, waiver, discharge, release or termination which is not so documented shall not be effective as to any party. SECTION 8.11 Applicable Law. THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE IN WHICH THE MORTGAGED PROPERTY IS LOCATED; PROVIDED, HOWEVER, THAT THE INDENTURE, THE NOTES AND THE GUARANTEE ARE, BY THEIR TERMS, GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS PROVIDED THEREIN, AND, IN THE EVENT THAT IT BECOMES NECESSARY, IN CONNECTION WITH THE ENFORCEMENT OF THIS MORTGAGE OR OTHERWISE, TO CONSTRUE OR ENFORCE THE OBLIGATIONS (WHICH OBLIGATIONS ARE SECURED BY THIS MORTGAGE), THE INDENTURE, THE NOTES AND THE GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. SECTION 8.12 Satisfaction of Prior Encumbrance. To the extent that proceeds advanced pursuant to the Indenture are used to pay indebtedness secured by any outstanding Lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds shall be deemed to have been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be subrogated to any and all rights, security interests and Liens owned by any owner or holder of such outstanding Liens, security interests, charges or encumbrances, irrespective of whether said Liens, security interests, charges or encumbrances are released, and it is expressly understood that, in consideration of the payment of such other indebtedness by Mortgagee, Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. SECTION 8.13 No Partnership. Nothing contained in this Mortgage is intended to, or shall be construed to, create to any extent and in any manner whatsoever any partnership, joint venture, or association between Mortgagor and Mortgagee, or in any way make Mortgagee a co-principal with Mortgagor with reference to the Mortgaged Property, and any inferences to the contrary are hereby expressly negated. SECTION 8.14 Headings. The Article, Section and Subsection headings hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections. SECTION 8.15 Release of Mortgage. If all of the Senior Secured Note Obligations shall be paid, performed and discharged, and the Indenture and the Guarantee terminated, Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record, at the sole cost and expense of Mortgagor, and shall execute and deliver (or cause to be executed and delivered) such instruments of satisfaction and discharge as may be appropriate, 28 such instruments to be duly acknowledged and in form for recording, at the sole cost and expense of Mortgagor. SECTION 8.16 Limitation of Senior Secured Note Obligations with Respect to Mortgaged Property. (a) Neither Mortgagee, nor any Holder shall have any duty to protect or preserve, or any liability with respect to the protection or preservation of, any Mortgaged Property or to preserve rights pertaining thereto other than the duty to use reasonable care in the custody and preservation of any Mortgaged Property in its actual possession. Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any Mortgaged Property in its possession if such Mortgaged Property is accorded treatment substantially equal to that which Mortgagee accords its own like property. Mortgagee shall be relieved of all responsibility for any Mortgaged Property in its possession upon surrendering it, or tendering surrender of it, to Mortgagor or to such other Person entitled thereto by applicable law. (b) Nothing contained in this Mortgage shall be construed as requiring or obligating Mortgagee, or any Holder, and neither Mortgagee, nor any Holder shall be required or obligated, to (i) make any demand or inquiry as to the nature or sufficiency of any payment received by it, or present or file any claim or notice or take any action with respect to any Mortgaged Property or the monies due or to become due thereunder in connection therewith, (ii) ascertain or take action with respect to calls, conversions, exchanges, maturities, tenders, offers or other matters relating to any Mortgaged Property, whether or not Mortgagee or any of the other Holders has or is deemed to have knowledge or notice thereof, (iii) take any necessary steps to preserve rights against any prior parties with respect to any Mortgaged Property, or (iv) notify Mortgagor or any other Person of any decline in the value of any Mortgaged Property. SECTION 8.17 Inconsistency with Indenture. To the fullest extent possible, the terms and provisions of the Indenture shall be read together with the terms and provisions of this Mortgage such that the terms and provisions of this Mortgage shall supplement, rather than conflict with, the terms and provisions of the Indenture; provided, however, that, notwithstanding the foregoing, in the event any of the terms or provisions of this Mortgage conflict with any of the terms or provisions of the Indenture, such that it is impractical for such terms or provisions to coexist, the terms or provisions of the Indenture shall govern and control for all purposes; and, provided further, that the inclusion in this Mortgage of terms and provisions, supplemental rights or remedies in favor of a secured party but which are not addressed in the Indenture shall not be deemed to be a conflict with the Indenture and all such additional terms, provisions, supplemental rights or remedies contained herein shall be given full force and effect. SECTION 8.18 Limitation on Interest Payable. It is the intention of the parties to conform strictly to the usury laws, whether state or federal, that are applicable to the transaction of which this Mortgage is a part. All agreements between Mortgagor and Mortgagee or any Holder, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid by Mortgagor for the use, forbearance or detention of the money to be loaned under the Indenture or any other Senior Secured Note Document, or for the payment or performance of any covenant or obligation contained herein or in the Indenture or any other Senior Secured Note 29 Document, exceed the maximum amount permissible under applicable federal or state usury laws. If, under any circumstances, fulfillment of any such provision, at the time performance of such provision shall be due, shall involve exceeding the limit of validity prescribed by applicable law, then the obligation to be fulfilled shall be reduced to the limit of such validity. If, under any circumstances, Mortgagor shall have paid an amount of money which is deemed to be interest and such interest would exceed the highest lawful rate, such amount that would be excessive interest under applicable usury laws shall be applied to the reduction of the principal amount owing in respect of the Senior Secured Note Obligations and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal and any other amounts due hereunder, the excess shall be refunded to Mortgagor. All sums paid or agreed to be paid for the use, forbearance or detention of the principal under any extension of credit by Mortgagee (or Holder) shall, to the extent permitted by applicable law, and to the extent necessary to preclude exceeding the limit of validity prescribed by applicable law, be amortized, prorated, allocated and spread from the date of this Mortgage until payment in full of the Senior Secured Note Obligations so that the actual rate of interest on account of such principal amounts is uniform throughout the term hereof. SECTION 8.19 Covenants To Run With the Land. All of the grants, representations, warranties, undertakings, covenants, terms, provisions and conditions in this Mortgage shall run with the Land and shall apply to and bind the successors and assigns of Mortgagor. If there shall be more than one mortgagor, the covenants, representations and warranties made herein shall be deemed to be joint and several. SECTION 8.20 Intentionally Omitted. SECTION 8.21 Defense of Claims. Mortgagor shall promptly notify Mortgagee in writing of the commencement of any legal proceedings affecting Mortgagor's title to the Mortgaged Property or Mortgagee's Lien on or security interest in the Mortgaged Property, or any part thereof, and shall take all such action, employing attorneys agreeable to Mortgagee, as may be necessary to preserve Mortgagor's and Mortgagee's rights affected thereby. If Mortgagor fails or refuses to adequately or vigorously, in the sole judgment of Mortgagee, defend Mortgagor's or Mortgagee's rights to the Mortgaged Property, Mortgagee may take such action on behalf of and in the name of Mortgagor and at Mortgagor's expense. Moreover, Mortgagee may take (or cause its agents to take) such independent action in connection therewith as they may in their discretion deem proper, including, without limitation, the right to employ independent counsel and to intervene in any suit affecting the Mortgaged Property. All costs, expenses and attorneys' fees incurred by Mortgagee (or its agents) pursuant to this Section 8.21 or in connection with the defense by Mortgagee of any claims, demands or litigation relating to Mortgagor, the Mortgaged Property or the transactions contemplated in this Mortgage shall be paid by Mortgagor on demand, plus interest thereon from the date of the advance by Mortgagee until reimbursement of Mortgagee at the Default Rate. SECTION 8.22 Exculpation Provisions. EACH OF THE PARTIES HERETO SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE 30 TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT "CONSPICUOUS." SECTION 8.23 No Merger of Estates. So long as any part of the Senior Secured Note Obligations remain unpaid, unperformed or undischarged, the fee, easement and leasehold estates to the Mortgaged Property shall not merge but rather shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any lessee, any third-party purchaser or otherwise. SECTION 8.24 Release Upon Transfer or Sale. (a) All Mortgaged Property sold or otherwise transferred in accordance with the terms of the Indenture shall be sold or otherwise transferred, as the case may be, free and clear of this Mortgage. In connection with any such sale or other transfer, the Mortgagee shall execute and deliver to Mortgagor, or to such person or persons as Mortgagor shall reasonably designate, a satisfaction of mortgage and such other documents as Mortgagor may reasonably request to evidence the release of this Mortgage with respect to such Mortgaged Property, as well as a release of any collateral assignments or other documents, instruments or filings in favor of Mortgagee that burden such Mortgaged Property. (b) In addition, and not in limitation of the foregoing, any Mortgaged Property (other than the Real Estate) that also constitutes Collateral under any Security Document shall automatically be released from this Mortgage in the event that such Mortgaged Property is released from the security interest created by such Security Document in accordance with the terms thereof and the Indenture. SECTION 8.25 Counterparts. This Mortgage may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall be deemed to constitute one single instrument, except that, to facilitate recordation, portions of Exhibit A hereto which describe properties situated in counties other than the county in which this Mortgage is to be recorded may be omitted. 31 ARTICLE IX STATE SPECIFIC PROVISIONS SECTION 9.01 State-Specific Provisions. Intentionally Omitted. ARTICLE X INTERCREDITOR Notwithstanding any provision to the contrary contained herein, the terms of this Mortgage, the Lien and security interest granted to Mortgagee pursuant to this Mortgage and the exercise of any rights and remedies by Mortgagee are subject to the terms of that certain Intercreditor Agreement, dated as of June __, 2004 (the "Intercreditor Agreement"), by and between JPMorgan Chase Bank, as ABL Agent, and Mortgagee, as Term Agent. In the event of any conflict between the terms and provisions of this Mortgage and the Intercreditor Agreement, the terms of the Intercreditor Agreement shall govern and control. [NO FURTHER TEXT ON THIS PAGE; SIGNATURE PAGE FOLLOWS] 32 IN WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first above written. MORTGAGOR: D-M-E COMPANY, a Delaware corporation By: /s/ R.P. Lienesch ----------------- Name: R.P. Lienesch Title: Vice President The Address of Mortgagee is: U.S. BANK NATIONAL ASSOCIATION, as Trustee and Collateral Agent 425 Walnut Street, Cincinnati, Ohio 45202 Attention: Corporate Trust Office ACKNOWLEDGEMENT STATE OF OHIO COUNTY OF HAMILTON ss.: On June 10, 2004, before me the undersigned personally appeared R. P. Lienesch, the duly authorized Vice President of D-M-E Company personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. /s/ P. Michelle Bevan --------------------- (signature and office of individual taking acknowledgment) EXHIBIT A LEGAL DESCRIPTION Tax parcel #_________________ A-1 EX-12 65 y98028exv12.txt STATEMENTS REGARDING COMPUTATION OF EARNINGS . . . EXHIBIT 12 MILACRON INC. CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED)
Three Months Year Ended December 31, Ended March 31, --------------------------------------------------------------------- --------------------------- 1999 2000 2001 2002 2003 2003 2004 ---- ---- ---- ---- ---- ---- ---- (In thousands) Earnings: Income (loss) before taxes $ 76,598(a) $68,259(b) $(51,108)(c) $(36,701)(d) $(111,840)(e) $(10,226)(f) $(14,862)(g) Add fixed charges (see below) 24,373 26,726 27,917 30,038 29,588 7,141 9,463 -------- ------- -------- -------- --------- -------- -------- Earnings as defined $100,971 $94,985 $(23,191) $ (6,663) $ (82,252) $ (3,085) $ (5,399) ======== ======= ======== ======== ========= ======== ======== Fixed Charges: Interest expense 20,873 22,426 24,184 25,471 24,855 5,958 8,263 Other adjustments(h) 3,500 4,300 3,733 4,567 4,733 1,183 1,200 -------- ------- -------- -------- --------- -------- -------- Fixed charges as defined $ 24,373 $26,726 $ 27,917 $ 30,038 $ 29,588 $ 7,141 $ 9,463 ======== ======= ======== ======== ========= ======== ======== Ratio of earnings to fixed charges 4.1 3.6 $(51,108)(c) $(36,701)(d) $(111,840)(e) $(10,226)(f) $(14,862)(g) ======== ======= ======== ======== ========= ======== ========

PRO FORMA REFINANCING TRANSACTION PRO FORMA RIGHTS OFFERING Year Ended Three Months Year Ended Three Months December 31, Ended March 31, December 31, Ended March 31, ------------ --------------- ------------ --------------- 2003 2004 2003 2004 --------- -------- --------- -------- (In thousands) (In thousands) Earnings: Income (loss) before taxes $(115,956) $(14,520) $(115,956) $(14,520) Add fixed charges (see below) 35,135 9,355 35,135 9,355 --------- -------- --------- -------- Earnings as defined $ (80,821) $ (5,165) $ (80,821) $ (5,165) ========= ======== ========= ======== Fixed Charges: Interest expense 30,402 8,155 30,402 8,155 Other adjustments(h) 4,733 1,200 4,733 1,200 --------- -------- --------- -------- Fixed charges as defined $ 35,135 $ 9,355 $ 35,135 $ 9,355 ========= ======== ========= ======== Ratio of earnings to fixed charges $(115,956) $(14,520) $(115,956) $(14,520) ========= ======== ========= ========
(a) Includes restructuring costs of $7.2 million and a gain of $13.1 million on the sale of the European extrusion systems business. (b) Includes restructuring costs of $1.4 million. (c) Includes restructuring costs of $17.5 million. (d) Includes restructuring costs of $13.9 million and a goodwill impairment charge of $1.0 million. (e) Includes restructuring costs of $27.1 million, a goodwill impairment charge of $65.6 million and refinancing costs of $1.8 million. (f) Includes restructuring costs of $6.0 million. (g) Includes restructuring costs of $1.1 million and refinancing costs of $6.4 million. (h) Other adjustments represents a portion of rental expense representative of an interest factor. MILACRON INC. CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES PLUS PREFERRED STOCK DIVIDENDS (UNAUDITED)
Three Months Year Ended December 31, Ended March 31, ------------------------------------------------------------------ -------------------------- 1999 2000 2001 2002 2003 2003 2004 ---- ---- ---- ---- ---- ---- ---- (In thousands) Earnings: Income (loss) before taxes $ 76,598(a) $68,259(b) $(51,108)(c) $(36,701)(d) $(111,840)(e) $(10,226)(f) $(14,862)(g) Add fixed charges (see below) 24,373 26,726 27,917 30,038 29,588 7,141 9,463 -------- ------- -------- -------- --------- -------- -------- Earnings as defined $100,971 $94,985 $(23,191) $ (6,663) $ (82,252) $ (3,085) $ (5,399) ======== ======= ======== ======== ========= ======== ======== Fixed Charges: Interest expense 20,873 22,426 24,184 25,471 24,855 5,958 8,263 Other adjustments(h) 3,500 4,300 3,733 4,567 4,733 1,183 1,200 -------- ------- -------- -------- --------- -------- -------- Fixed charges as defined $ 24,373 $26,726 $ 27,917 $ 30,038 $ 29,588 $ 7,141 $ 9,463 ======== ======= ======== ======== ========= ======== ======== Preferred Stock Dividends $ 240 $ 240 $ 240 $ 240 $ 240 $ 60 $ 60 Ratio of earnings to fixed charges plus preferred stock dividends 4.1 3.5 $(51,348)(c) $(36,941)(d) $(112,080)(e) $(10,286)(f) $(14,922)(g) ======== ======= ======== ======== ========= ======== ========

PRO FORMA REFINANCING TRANSACTION PRO FORMA RIGHTS OFFERING Year Ended Three Months Year Ended Three Months December 31, Ended March 31, December 31, Ended March 31, 2003 2004 2003 2004 ---- ---- ---- ---- (In thousands) (In thousands) Earnings: Income (loss) before taxes $(115,956) $(14,520) $(115,956) $(14,520) Add fixed charges (see below) 35,135 9,355 35,135 9,355 --------- -------- --------- -------- Earnings as defined $ (80,821) $ (5,165) $ (80,821) $ (5,165) ========= ======== ========= ======== Fixed Charges: Interest expense 30,402 8,155 30,402 8,155 Other adjustments(h) 4,733 1,200 4,733 1,200 --------- -------- --------- -------- Fixed charges as defined $ 35,135 $ 9,355 $ 35,135 $ 9,355 ========= ======== ========= ======== Preferred Stock Dividends $ 6,240 $ 1,560 $ 4,440 $ 1,110 Ratio of earnings to fixed charges plus preferred stock dividends $(122,196) $(16,080) $(120,396) $(15,630) ========= ======== ========= ========
(a) Includes restructuring costs of $7.2 million and a gain of $13.1 million on the sale of the European extrusion systems business. (b) Includes restructuring costs of $1.4 million. (c) Includes restructuring costs of $17.5 million. (d) Includes restructuring costs of $13.9 million and a goodwill impairment charge of $1.0 million. (e) Includes restructuring costs of $27.1 million, a goodwill impairment charge of $65.6 million and refinancing costs of $1.8 million. (f) Includes restructuring costs of $6.0 million. (g) Includes restructuring costs of $1.1 million and refinancing costs of $6.4 million. (h) Other adjustments represents a portion of rental expense representative of an interest factor. MILACRON INC. CALCULATION OF CURRENT RATIO (UNAUDITED)
Three Months Year Ended December 31, Ended March 31, ---------------------------------------------------- ------------------- 1999 2000 2001 2002 2003 2003 2004 ---- ---- ---- ---- ---- ---- ---- (In thousands) Current assets related to continuing operations $440,924 $401,825 $411,786 $428,769 $364,133 $386,962 $387,320 -------- -------- -------- -------- -------- -------- -------- Current liabilities related to continuing operations $454,892 $309,027 $244,971 $271,280 $352,260 $356,862 $378,149 -------- -------- -------- -------- -------- -------- -------- Ratio 0.97 1.30 1.68 1.58 1.03 1.08 1.02 ======== ======== ======== ======== ======== ======== ========
EX-21 66 y98028exv21.txt SUBSIDIARES . . . EXHIBIT 21 SUBSIDIARIES OF MILACRON INC.
DATE INCORPORATED OR (IF LATER) INCORPORATED DATE PERCENTAGE STATE OR COUNTRY ACQUIRED OWNED -------------------- ------------- ---------- MILACRON INC...................................... Delaware 1983 Milacron Capital Holdings B.V. ................. The Netherlands 2000 100% Milacron Investments B.V. ................... The Netherlands 2000 100% Milacron B.V. ............................... The Netherlands 1952 100% Milacron Nederland B.V. ................... The Netherlands 1998 100% Cimcool Europe B.V. .................... The Netherlands 1989 100% Ferromatik Milacron Benelux B.V. ......................... The Netherlands 1993 100% Cimcool Industrial Products B.V. ....... The Netherlands 1960 100% Oak International Europe Ltd. ........ England 1999 100% Milacron Kunststoffmaschinen Europa GmbH............................. Germany 1990 100% Uniloy Milacron Germany GmbH.......... Germany 1998 100% Indu Tecnospol s.r.o. .............. Czech Republic 1998 100% Ferromatik Milacron Maschinenbau GmbH.................. Germany 1993 100% Ferromatik Milacron.............. South Africa 1994 100% Ferromatik Milacron A/S.......... Denmark 2002 100% Klockner Ferromatik AG........... Switzerland 2003 100% D-M-E Normalien GmbH.................. Germany 1996 100% EOC France S.A.R.L. ............... France 2001 99% EOC Normalien Praha s.r.o. ........ Czech Republic 2001 100% D-M-E Belgium CVBA......................... Belgium 1996 100% VSI International N.V. ................. Belgium 1996 100% Milacron France SAS........................ France 2002 100% Milacron U.K. Ltd. ........................ England 2002 100% Uniloy Milacron Italy S.R.L. .............. Italy 1998 100% Milacron Plastics Iberica S.L. ............ Spain 2002 100% Milacron Assurance Ltd. ........................ Bermuda 1977 100% Milacron-Holdings Mexico S.A. de C.V. .......... Mexico 1992 100% Milacron Marketing Company...................... Ohio 1931 100% Milacron International Marketing Company.......................... Delaware 1966 100% Milacron Equipamentos Plasticos Ltd. ... Brazil 1997 100%

DATE INCORPORATED OR (IF LATER) INCORPORATED DATE PERCENTAGE STATE OR COUNTRY ACQUIRED OWNED -------------------- ------------- ---------- Northern Supply Company, Inc. ............... Minnesota 1998 100% Ferromatik Milacron India Limited............ India 1995 86% Nickerson Machinery Chicago Inc. ............ Illinois 1999 100% Pliers International, Inc. .................. Delaware 1999 100% Cincinnati Milacron Trading Co. LTD.......... Shanghai 1998 100% Milacron Resin Abrasives Inc. .................. Delaware 1991 100% D-M-E Company................................... Delaware 1996 100% D-M-E USA.................................... Michigan 1998 100% D-M-E of Canada Limited.................... Canada 1996 100% Progress Precision...................... Canada 2001 100% 450500 Ontario Limited.................. Canada 1996 100% Ontario Heater and Supply Company....... Canada 2000 100% Rite-Tek Canada......................... Canada 2000 100% Japan D-M-E Corporation.................... Japan 1996 51% D-M-E Hong Kong Ltd. ...................... Hong Kong 1996 51% D-M-E Manufacturing Inc. .................... Delaware 1999 100% Uniloy Milacron Inc. ........................... Delaware 1998 100% Uniloy Milacron Machinery -- Mexico, S.A. de C.V. ................................... Mexico 1998 100% Uniloy Milacron Services -- Mexico, S.A. de C.V. ................................... Mexico 1998 100% Uniloy Milacron U.S.A. ......................... Michigan 1998 100% Milacron Industrial Products, Inc. ............. Michigan 1999 100% Oak International, Inc. ..................... Michigan 1999 100% Cimcool Industrial Products Inc. ............... Delaware 1999 100% Cincinnati Milacron IPK, Inc. ............... Korea 1993 100% Milacron Canada, Inc. ....................... Ontario 1997 100% Milacron-Mexicana Sales S.A. de C.V. ...... Mexico 1993 100% Milacron Plastics Technologies Group Inc. ...... Delaware 1999 100% Milacron Plastics Machinery (Jinangyin) Co., Ltd. ............................... China 2004 70%
EX-23.1 67 y98028exv23w1.txt CONSENT OF ERNST & YOUNG EXHIBIT 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-44423) pertaining to the 1991 Long-term Incentive Plan, in the Registration Statement (Form S-8 No. 33-56403) pertaining to the 1994 Long-term Incentive Plan, in the Registration Statement (Form S-8 No. 333-36743) pertaining to the 1997 Long-term Incentive Plan of Milacron Inc., in the Registration Statement (Form S-8 No. 333-116414) pertaining to the 2004 Long-term Incentive Plan of Milacron Inc., and in the Registration Statement (Form S-8 No. 333-70733) pertaining to the Milacron Inc. Plan for the Deferral of Director's Compensation, of our report dated February 10, 2004, except for the "Subsequent Events" note, as to which the date is June 10, 2004, with respect to the consolidated financial statements and schedule of Milacron Inc. and subsidiaries included in this Registration Statement (Form S-4) pertaining to the registration of 11.5% Senior Secured Notes due in 2011. /s/ Ernst & Young LLP Cincinnati, Ohio June 18, 2004 EX-25 68 y98028exv25.txt FORM T-1 Exhibit 25 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------------------- FORM T-1 Statement of Eligibility Under The Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee Check if an Application to Determine Eligibility of a Trustee Pursuant to Section 305(b)(2) ------------------------------------------------------- U.S. BANK NATIONAL ASSOCIATION (Exact name of Trustee as specified in its charter) 31-0841368 I.R.S. Employer Identification No. - -------------------------------------------------------------------------------- 800 Nicollet Mall Minneapolis, Minnesota 55402 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) - -------------------------------------------------------------------------------- Karolina Donlin U.S. Bank National Association 425 Walnut Street Cincinnati, OH 45202 (513) 632-2077 (Name, address and telephone number of agent for service) Milacron Escrow Corporation (Issuer with respect to the Securities) - -------------------------------------------------------------------------------- Ohio 31-1062125 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) - -------------------------------------------------------------------------------- 2090 Florence Avenue Cincinnati, OH 45206-2425 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) - -------------------------------------------------------------------------------- 11 1/2% Senior Secured Notes Dues 2011 (Title of the Indenture Securities) ================================================================================ FORM T-1 Item 1. GENERAL INFORMATION. Furnish the following information as to the Trustee. a) Name and address of each examining or supervising authority to which it is subject. Comptroller of the Currency Washington, D.C. b) Whether it is authorized to exercise corporate trust powers. Yes Item 2. AFFILIATIONS WITH OBLIGOR. If the obligor is an affiliate of the Trustee, describe each such affiliation. None Items 3-15 Items 3-15 are not applicable because to the best of the Trustee's knowledge, the obligor is not in default under any Indenture for which the Trustee acts as Trustee. Item 16. LIST OF EXHIBITS: List below all exhibits filed as a part of this statement of eligibility and qualification. 1. A copy of the Articles of Association of the Trustee.* 2. A copy of the certificate of authority of the Trustee to commence business.* 3. A copy of the certificate of authority of the Trustee to exercise corporate trust powers.* 4. A copy of the existing bylaws of the Trustee.* 5. A copy of each Indenture referred to in Item 4. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Trust Indenture Act of 1939, attached as Exhibit 6. 7. Report of Condition of the Trustee as of March 31, 2004, published pursuant to law or the requirements of its supervising or examining authority, attached as Exhibit 7. * Incorporated by reference to Registration Number 333-67188. 2 NOTE The answers to this statement insofar as such answers relate to what persons have been underwriters for any securities of the obligors within three years prior to the date of filing this statement, or what persons are owners of 10% or more of the voting securities of the obligors, or affiliates, are based upon information furnished to the Trustee by the obligors. While the Trustee has no reason to doubt the accuracy of any such information, it cannot accept any responsibility therefor. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the Trustee, U.S. BANK NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, has duly caused this statement of eligibility and qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Cincinnati, Ohio on the 2nd of June, 2004. U.S. BANK NATIONAL ASSOCIATION By: /s/ Karolina K Dies --------------------------- Karolina K Dies Trust Officer By: /s/ Robert T Jones --------------------------- Robert T Jones Vice President 3 Exhibit 6 --------- CONSENT In accordance with Section 321(b) of the Trust Indenture Act of 1939, the undersigned, U.S. BANK NATIONAL ASSOCIATION hereby consents that reports of examination of the undersigned by Federal, State, Territorial or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon its request therefor. Dated: June 2, 2004 U.S. BANK NATIONAL ASSOCIATION By: /s/ Karolina K Dies --------------------------- Karolina K Dies Trust Officer By: /s/ Robert T Jones --------------------------- Robert T Jones Vice President 4 Exhibit 7 U.S. Bank National Association Statement of Financial Condition As of 3/31/2004 ($000's) 3/31/2004 ------------ Assets Cash and Due From Depository Institutions $7,180,778 Federal Reserve Stock 0 Securities 45,038,794 Federal Funds 2,593,702 Loans & Lease Financing Receivables 116,474,594 Fixed Assets 1,789,213 Intangible Assets 10,532,022 Other Assets 7,996,466 ------------ Total Assets $191,605,569 Liabilities Deposits $126,605,087 Fed Funds 5,698,785 Treasury Demand Notes 3,981,328 Trading Liabilities 252,912 Other Borrowed Money 23,295,560 Acceptances 148,067 Subordinated Notes and Debentures 5,807,310 Other Liabilities 5,587,914 ------------ Total Liabilities $171,376,963 Equity Minority Interest in Subsidiaries $1,005,645 Common and Preferred Stock 18,200 Surplus 11,677,397 Undivided Profits 7,527,364 ------------ Total Equity Capital $20,228,606 Total Liabilities and Equity Capital $191,605,569 - -------------------------------------------------------------------------------- To the best of the undersigned's determination, as of the date hereof, the above financial information is true and correct. U.S. Bank National Association By: /s/ Karolina K Dies ---------------------------- Trust Officer Date: June 2, 2004 5 EX-99.1 69 y98028exv99w1.txt FORM OF LETTER OF TRANSMITTAL EXHIBIT 99.1 LETTER OF TRANSMITTAL MILACRON INC. OFFER TO EXCHANGE UP TO $225,000,000 PRINCIPAL AMOUNT OUTSTANDING OF 11 1/2% SENIOR SECURED NOTES DUE 2011 FOR A LIKE PRINCIPAL AMOUNT OF 11 1/2% SENIOR SECURED NOTES DUE 2011 WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 PURSUANT TO THE PROSPECTUS, DATED , 2004 THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK CITY TIME, ON , 2004, UNLESS EXTENDED (SUCH DATE AND TIME, AS IT MAY BE EXTENDED, THE "EXPIRATION DATE"). TENDERS MAY BE WITHDRAWN PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. By Registered or Certified Mail, Overnight Carrier or Hand: U.S. Bank National Association Attn: Shauna Thilmany/Specialized Finance Dept. Mailcode: EP-MN-WS2N 60 Livingston Avenue St. Paul, MN 55107 By Facsimile: (651)495-8158 Confirm by telephone: (800)934-6802 For information, call: (800)934-6802 Delivery of this instrument to an address other than as set forth above, or transmission of instructions via facsimile other than as set forth above, will not constitute a valid delivery. The undersigned acknowledges that he or she has received the prospectus, dated , 2004 (the "Prospectus"), of Milacron Inc., a Delaware corporation (the "Company"), and this letter of transmittal (the "Letter"), which together constitute the Company's offer (the "Exchange Offer") to exchange an aggregate principal amount of up to $225,000,000 of registered 11 1/2% Senior Secured Notes due 2011 (the "Exchange Notes") of the Company for an equal principal amount of the Company's outstanding 11 1/2% Senior Secured Notes due 2011 (the "Original Notes"). Capitalized terms used but not defined herein shall have the same meaning given to them in the Prospectus. For each Original Note accepted for exchange, the holder of such Original Note will receive an Exchange Note having a principal amount equal to that of the surrendered Original Note. Interest on the Exchange Notes will accrue at a rate of 11 1/2% per annum and be payable semiannually in arrears on May 15 and November 15 of each year, commencing on November 15, 2004. The Exchange Notes will mature on May 15, 2011. The terms of the Exchange Notes are substantially identical to the terms of the Original Notes, except that the Exchange Notes have been registered under the Securities Act of 1933 and are free of any obligation regarding registration. If (i) neither the registration statement relating to the Exchange Offer (the "Exchange Offer Registration Statement") nor, if required in lieu thereof, a shelf registration statement (the "Shelf Registration Statement") is declared effective by the Commission on or prior to 180 days (or if the 180th day is not a business day, the first business day thereafter) after the release to us from escrow the proceeds from the offering of the Original Notes (the "Effectiveness Target Date"), (ii) neither the Exchange Offer is consummated nor, if required in lieu thereof, the Shelf Registration Statement is declared effective by the Commission on or prior to the 40th business day after the Effectiveness Target Date, (iii) if either the Exchange Offer Registration Statement or the Shelf Registration Statement is declared effective but thereafter ceases to be effective or usable in connection with resales of Transfer Restricted Securities (as defined in the registration rights agreement dated as of May 26, 2004 among Milacron Escrow Corporation and Credit Suisse First Boston LLC, as representative of the several purchasers listed therein, which Milacron Inc. and the guarantors listed therein entered into pursuant to a Joinder dated May 26, 2004) during certain specified periods (each such event referred to in clauses (i) through (iii) a "Registration Default"), then commencing on the day after the occurrence of such Registration Default, additional interest shall be paid by the Company to each holder of the Original Notes, with respect to the first 90-day period immediately following the occurrence of the first Registration Default in an amount equal to 50 basis points per annum of the principal amount of Securities held by such holder. The amount of the additional interest will increase by an additional 50 basis points per annum of the principal amount of Securities with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum amount of additional interest for all Registration Defaults of 100 basis points per annum of the principal amount of Securities. Following the cure of all Registration Defaults, the accrual of additional interest will cease. The additional interest provisions described herein are applicable only to the Original Notes and do not apply to the Exchange Notes. The Company reserves the right, at any time or from time to time, to extend the Exchange Offer at its discretion, in which event the term "Expiration Date" shall mean the latest time and date to which the Exchange Offer is extended. The Company shall publicly announce any extension by making a timely release through an appropriate news agency. This Letter is to be completed by a holder of Original Notes either if certificates are to be forwarded herewith or if a tender of Original Notes, if available, is to be made by book-entry transfer to the account maintained by U.S. Bank National Association (the "Exchange Agent") at The Depository Trust Company (the "Book-Entry Transfer Facility") pursuant to the procedures set forth in "The Exchange Offer" section of the Prospectus. Holders of Original Notes whose certificates are not immediately available, or who are unable to deliver their certificates or confirmation of the book-entry tender of their Original Notes into the Exchange Agent's account at the Book-Entry Transfer Facility (a "Book-Entry Confirmation") and all other documents required by this Letter to the Exchange Agent on or prior to the Expiration Date, must tender their Original Notes according to the guaranteed delivery procedures set forth in "The Exchange Offer -- Guaranteed Delivery Procedures" section of the Prospectus. See Instruction 1. Delivery of documents to the Book-Entry Transfer Facility does not constitute delivery to the Exchange Agent. The undersigned has completed the appropriate boxes below and signed this Letter to indicate the action the undersigned desires to take with respect to the Exchange Offer. 2 List below the Original Notes to which this Letter relates. If the space provided below is inadequate, the numbers and principal amount at maturity of Original Notes should be listed on a separate signed schedule affixed hereto.
- ------------------------------------------------------------------------------------------------------------------------------ DESCRIPTION OF ORIGINAL NOTES - ------------------------------------------------------------------------------------------------------------------------------ 1 2 3 ----------------------------------------------------------------------------- AGGREGATE PRINCIPAL AMOUNT OF ORIGINAL PRINCIPAL AMOUNT NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) CERTIFICATE NOTES REPRESENTED OF ORIGINAL NOTES (PLEASE FILL IN, IF BLANK) NUMBER(S)* BY CERTIFICATE TENDERED** - ------------------------------------------------------------------------------------------------------------------------------ ----------------------------------------------------------------------------- ----------------------------------------------------------------------------- ----------------------------------------------------------------------------- ----------------------------------------------------------------------------- ----------------------------------------------------------------------------- Total - ------------------------------------------------------------------------------------------------------------------------------ * Need not be completed if Original Notes are being tendered by book-entry transfer. ** Unless otherwise indicated in this column, a holder will be deemed to have tendered ALL of the Original Notes represented by the Original Notes indicated in column 2. See Instruction 2. Original Notes tendered must be in denominations of principal amount at maturity of $1,000 and any integral multiple thereof. See Instruction 1. - ------------------------------------------------------------------------------------------------------------------------------
[ ] CHECK HERE IF TENDERED ORIGINAL NOTES ARE ENCLOSED HEREWITH. [ ] CHECK HERE IF TENDERED ORIGINAL NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING: Name of Tendering Institution - -------------------------------------------------------------------------------- Account Number Transaction Code Number - -------------------------------------------------------------------------------- 3 [ ] CHECK HERE IF TENDERED ORIGINAL NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING: Name(s) of Registered Holder(s) - -------------------------------------------------------------------------------- Window Ticket Number (if any) - -------------------------------------------------------------------------------- Date of Execution of Notice of Guaranteed Delivery -------------------------- Name of Institution which guaranteed delivery ------------------------------- IF DELIVERED BY BOOK-ENTRY TRANSFER, COMPLETE THE FOLLOWING: Account Number Transaction Code Number ---------------------------------------------------------------------------- [ ] CHECK HERE IF YOU ARE A BROKER DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO. Name: - -------------------------------------------------------------------------------- Address: - -------------------------------------------------------------------------------- 4 PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY Ladies and Gentlemen: Upon the terms and subject to the conditions of the Exchange Offer, the undersigned hereby tenders to the Company the aggregate principal amount at maturity of the Original Notes indicated above. Subject to, and effective upon, the acceptance for exchange of the Original Notes tendered hereby, the undersigned hereby sells, assigns and transfers to, or upon the order of, the Company all right, title and interest in and to such Original Notes as are being tendered hereby. The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, sell, assign and transfer the Original Notes tendered hereby and that the Company will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claim when the same are accepted by the Company. The undersigned hereby further represents that any Exchange Notes acquired in exchange for Original Notes tendered hereby will have been acquired in the ordinary course of business of the person receiving such Exchange Notes, whether or not such person is the undersigned, that neither the holder of such Original Notes nor any such other person is engaged in, or intends to engage in a distribution of such Exchange Notes, or has an arrangement or understanding with any person to participate in the distribution of such Exchange Notes, and that neither the holder of such Original Notes nor any such other person is an "affiliate," as defined in Rule 405 under the Securities Act of 1933, as amended (the "Securities Act"), of the Company. The undersigned also acknowledges that this Exchange Offer is being made by the Company based upon the Company's understanding of an interpretation by the staff of the Securities and Exchange Commission (the "Commission") as set forth in no-action letters issued to third parties, that the Exchange Notes issued in exchange for the Original Notes pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by holders thereof, without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that: (1) such holders are not affiliates of the Company within the meaning of Rule 405 under the Securities Act; (2) such Exchange Notes are acquired in the ordinary course of such holders' business; and (3) such holders are not engaged in, and do not intend to engage in, a distribution of such Exchange Notes and have no arrangement or understanding with any person to participate in the distribution of such Exchange Notes. However, the staff of the Commission has not considered the Exchange Offer in the context of a no-action letter, and there can be no assurance that the staff of the Commission would make a similar determination with respect to the Exchange Offer as in other circumstances. If a holder of Original Notes is an affiliate of the Company, acquires the Exchange Notes other than in the ordinary course of such holder's business or is engaged in or intends to engage in a distribution of the Exchange Notes or has any arrangement or understanding with respect to the distribution of the Exchange Notes to be acquired pursuant to the Exchange Offer, such holder could not rely on the applicable interpretations of the staff of the Commission and must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any secondary resale transaction. If the undersigned is a broker-dealer that will receive Exchange Notes for its own account in exchange for Original Notes, it represents that the Original Notes to be exchanged for the Exchange Notes were acquired by it as a result of market-making activities or other trading activities and acknowledges that it will deliver a Prospectus in connection with any resale of such Exchange Notes; however, by so acknowledging and by delivering a Prospectus, the undersigned will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. The undersigned will, upon request, execute and deliver any additional documents deemed by the Company to be necessary or desirable to complete the sale, assignment and transfer of the Original Notes tendered hereby. All authority conferred or agreed to be conferred in this Letter and every obligation of the undersigned hereunder shall be binding upon the successors, assigns, heirs, executors, administrators, trustees in bankruptcy and legal representatives of the undersigned and shall not be affected by, and shall survive, the death or incapacity of the undersigned. This tender may be withdrawn only in accordance with the procedures set forth in "The Exchange Offer -- Withdrawal of Tenders" section of the Prospectus. 5 Unless otherwise indicated in the box entitled "Special Issuance Instructions" below, please deliver the Exchange Notes in the name of the undersigned or, in the case of a book-entry delivery of Original Notes, please credit the account indicated above maintained at the Book-Entry Transfer Facility. Similarly, unless otherwise indicated under the box entitled "Special Delivery Instructions" below, please send the Exchange Notes to the undersigned at the address shown above in the box entitled "Description of Original Notes." 6 THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF ORIGINAL NOTES" ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED THE ORIGINAL NOTES AS SET FORTH IN SUCH BOX ABOVE. SPECIAL ISSUANCE INSTRUCTIONS (SEE INSTRUCTIONS 3 AND 4) To be completed ONLY if certificates for Original Notes not exchanged and/or Exchange Notes are to be issued in the name of and sent to someone other than the person(s) whose signature(s) appear(s) on this Letter above, or if Original Notes delivered by book-entry transfer which are not accepted for exchange are to be returned by credit to an account maintained at the Book-Entry Transfer Facility other than the account indicated above. Issue Exchange Notes and/or Original Notes to: Name(s): - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) Address: - -------------------------------------------------------------------------------- (INCLUDING ZIP CODE) (COMPLETE ACCOMPANYING SUBSTITUTE FORM W-9) [ ] Credit unexchanged Original Notes delivered by book-entry transfer to the Book-Entry Transfer Facility account set forth below. - -------------------------------------------------------------------------------- (BOOK-ENTRY TRANSFER FACILITY ACCOUNT NUMBER, IF APPLICABLE) SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 3 AND 4) To be completed ONLY if certificates for Original Notes not exchanged and/or Exchange Notes are to be sent to someone other than the person(s) whose signature(s) appear(s) on this Letter above or to such person(s) at an address other than shown in the box entitled, "Description of Original Notes" on this Letter above. Mail Exchange Notes and/or Original Notes to: Name(s): - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) Address: - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (INCLUDING ZIP CODE) IMPORTANT: THIS LETTER OR A FACSIMILE HEREOF (TOGETHER WITH THE CERTIFICATES FOR ORIGINAL NOTES OR A BOOK-ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS OR THE NOTICE OF GUARANTEED DELIVERY) MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL CAREFULLY BEFORE COMPLETING ANY BOX ABOVE. 7 PLEASE SIGN HERE (TO BE COMPLETED BY ALL TENDERING HOLDERS) (COMPLETE ACCOMPANYING SUBSTITUTE FORM W-9 ON REVERSE SIDE) X: -------------------------------------------------------- ---------------------------------------------- , 2004 X: -------------------------------------------------------- ---------------------------------------------- , 2004 (SIGNATURE OF OWNER(S)) (DATE)

Area Code and Telephone Number: If a holder is tendering any Original Notes, this Letter must be signed by the registered holder(s) as the name(s) appear(s) on the certificate(s) for the Original Notes or by any person(s) authorized to become registered holder(s) by endorsements and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, officer or other person acting in a fiduciary or representative capacity, please set forth full title. See Instruction 3. Name(s): - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) Capacity: - -------------------------------------------------------------------------------- Address: - -------------------------------------------------------------------------------- (INCLUDING ZIP CODE) SIGNATURE GUARANTEE (IF REQUIRED BY INSTRUCTION 3) Signature Guaranteed by an Eligible Institution: - -------------------------------------------------------------------------------- (AUTHORIZED SIGNATURE) - -------------------------------------------------------------------------------- (TITLE) - -------------------------------------------------------------------------------- (NAME AND FIRM) Dated: - ------------------------------------------------------------------------- , 2004 8 INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER TO EXCHANGE UP TO $225,000,000 PRINCIPAL AMOUNT OUTSTANDING OF 11 1/2% SENIOR SECURED NOTES DUE 2011 FOR A LIKE PRINCIPAL AMOUNT OF 11 1/2% SENIOR SECURED NOTES DUE 2011 WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 1. DELIVERY OF THIS LETTER AND ORIGINAL NOTES; GUARANTEED DELIVERY PROCEDURES. This Letter is to be completed by holders of Original Notes either if certificates are to be forwarded herewith or if tenders are to be made pursuant to the procedures for delivery by book-entry transfer set forth in "The Exchange Offer -- Procedures for Tendering" section of the Prospectus. Certificates for all physically tendered Original Notes, or Book-Entry Confirmation, as the case may be, as well as a properly completed and duly executed letter of transmittal (or facsimile thereof) and any other documents required by this Letter, must be received by the Exchange Agent at the address set forth herein on or prior to the Expiration Date, or the tendering holder must comply with the guaranteed delivery procedures set forth below. Original Notes tendered hereby must be in denominations of $1,000 and any integral multiple thereof. Holders of Original Notes whose certificates for Original Notes are not immediately available or who cannot deliver their certificates and all other required documents to the Exchange Agent on or prior to the Expiration Date, or who cannot complete the procedure for book-entry transfer on a timely basis, may tender their Original Notes pursuant to the guaranteed delivery procedures set forth in "The Exchange Offer -- Guaranteed Delivery Procedures" section of the Prospectus. Pursuant to such procedures, (i) such tender must be made through an Eligible Institution (as defined below), (ii) prior to the Expiration Date, the Exchange Agent must receive from such Eligible Institution a properly completed and duly executed notice of guaranteed delivery (or facsimile thereof), substantially in the form provided by the Company (by facsimile transmission, mail or hand delivery), setting forth the name and address of the holder of Original Notes, the certificate number or numbers of such Original Notes and the principal amount at maturity of Original Notes tendered, stating that the tender is being made thereby and guaranteeing that within three New York Stock Exchange trading days after the Expiration Date, the letter of transmittal (or facsimile thereof), together with the certificate or certificates representing the Original Notes to be tendered in proper form for transfer, or a confirmation of book-entry transfer, as the case may be, and any other documents required by this Letter will be deposited by the Eligible Institution (as defined below) with the Exchange Agent, and (iii) such properly completed and executed letter of transmittal (or facsimile thereof), as well as the certificate or certificates representing all tendered Original Notes in proper form for transfer, or a confirmation of book-entry transfer, as the case may be, and all other documents required by this Letter are received by the Exchange Agent within three New York Stock Exchange trading days after the Expiration Date. The method of delivery of this Letter, the Original Notes and all other required documents is at the election and risk of the tendering holders. Instead of delivery by mail, it is recommended that holders use an overnight or hand delivery service. In all cases, sufficient time should be allowed to assure delivery to the Exchange Agent before the Expiration Date. No letter of transmittal or Original Notes should be sent to the Company. Holders may request their respective brokers, dealers, commercial banks, trust companies or nominees to effect the tenders for such holders. See "The Exchange Offer" section of the Prospectus. 2. PARTIAL TENDERS (NOT APPLICABLE TO HOLDERS OF ORIGINAL NOTES WHO TENDER BY BOOK-ENTRY TRANSFER); WITHDRAWALS. If less than all of the Original Notes evidenced by a submitted certificate are to be tendered, the tendering holder(s) should fill in the aggregate principal amount of Original Notes to be tendered in the box above entitled "Description of Original Notes -- Principal Amount of Original Notes Tendered." A newly reissued certificate for the Original Notes submitted but not tendered will be sent to such holder as soon as practicable after the Expiration Date. All of the Original Notes delivered to the Exchange Agent will be deemed to have been tendered unless otherwise clearly indicated. If not yet accepted, a tender pursuant to the Exchange Offer may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date. To be effective with respect to the tender of Original Notes, a notice of withdrawal must: (i) be received by the Exchange Agent prior to 5:00 p.m., New York City time, on the Expiration Date; (ii) specify the name of the person who deposited the Original Notes to be withdrawn; (iii) identify the Original Notes to be withdrawn (including the certificate number(s) and principal amount at maturity of such Original Notes); (iv) be signed by the depositor in the same manner as the original signature on this Letter by which such Original Notes were tendered (including any required signature guarantee) or be accompanied by documents or transfer sufficient to have the trustee register the transfer of such Original Notes into the name of the person withdrawing the tender; and (v) specify the name in which any such Original Notes are to be registered, if different from that of the depositor. The Exchange Agent will return the properly withdrawn Original Notes as soon as practicable following receipt of notice of withdrawal. If Original Notes have been tendered pursuant to the procedure for book-entry transfer, any notice of withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn Original Notes or otherwise comply with the book-entry transfer facility's procedures. All questions as to the validity of notices of withdrawal, including time of receipt, will be determined by the Company, and such determination will be final and binding on all parties. 3. SIGNATURES ON THIS LETTER, BOND POWERS AND ENDORSEMENTS; GUARANTEE OF SIGNATURES. If this Letter is signed by the registered holder of the Original Notes tendered hereby, the signature must correspond exactly with the name as written on the face of the certificates without alteration, enlargement or any change whatsoever. If any tendered Original Notes are owned of record by two or more joint owners, all such owners must sign this Letter. If any tendered Original Notes are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate copies of this Letter as there are different registrations of certificates. When this Letter is signed by the registered holder (which term, for the purposes described herein, shall include the book-entry transfer facility whose name appears on a security listing as the owner of the Original Notes) of the Original Notes specified herein and tendered hereby, no endorsements of certificates or separate bond powers are required. If, however, the Exchange Notes are to be issued to a person other than the registered holder, then endorsements of any certificates transmitted hereby or separate bond powers are required. Signatures on such certificates must be guaranteed by an Eligible Institution (as defined below). If this Letter is signed by a person other than the registered holder or holders of any Original Notes specified therein, such certificate(s) must be endorsed by such registered holder(s) or accompanied by separate written instruments of transfer or endorsed in blank by such registered holder(s) in form satisfactory to the Company and duly executed by the registered holder, in either case signed exactly as such registered holder(s) name or names appear(s) on the Original Notes. If the Letter or any certificates of Original Notes or separate written instruments of transfer or exchange are signed or endorsed by trustees, executors, administrators, guardians, attorney-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and, unless waived by the Company, evidence satisfactory to the Company of their authority to so act must be submitted with the Letter. Signature on a Letter or a notice of withdrawal, as the case may be, must be guaranteed by an Eligible Institution unless the Original Notes tendered pursuant thereto are tendered (i) by a registered holder who has not completed the box entitled "Special Payment Instructions" or "Special Delivery Instructions" on the Letter or (ii) for the account of an Eligible Institution. In the event that signatures on a Letter or a notice of withdrawal, as the case may be, are required to be guaranteed, such guarantee must be by a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the United States or an "eligible guarantor institution" within the meaning of Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended (an "Eligible Institution"). 2 4. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. Tendering holders of Original Notes should indicate in the applicable box the name and address to which Exchange Notes issued pursuant to the Exchange Offer are to be issued or sent, if different from the name or address of the person signing this Letter. In the case of issuance in a different name, the employer identification or social security number of the person named must also be indicated. Holders tendering Original Notes by book-entry transfer may request that Original Notes not exchanged be credited to such account maintained at the Book-Entry Transfer Facility as such holder may designate hereon. If no such instructions are given, such Original Notes not exchanged will be returned to the name or address of the person signing this Letter. 5. TAX IDENTIFICATION NUMBER. An exchange of Original Notes for Exchange Notes will not be treated as a taxable exchange or other taxable event for U.S. Federal income tax purposes. In particular, no backup withholding or information reporting is required in connection with such an exchange. However, U.S. Federal income tax law generally requires that payments of principal and interest on a note to a holder be subject to backup withholding unless such holder provides the payor with such holder's correct Taxpayer Identification Number ("TIN") on Substitute Form W-9 below or otherwise establishes a basis for exemption. If such holder is an individual, the TIN is his or her social security number. If the payor is not provided with the current TIN or an adequate basis for an exemption, such tendering holder may be subject to a $50 penalty imposed by the Internal Revenue Service. In addition, such holder may be subject to backup withholding in an amount that is currently 28% of all reportable payments of principal and interest. Certain holders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. See the enclosed Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9 (the "W-9 Guidelines") for additional instructions. To prevent backup withholding on reportable payments of principal and interest, each tendering holder of Original Notes must provide its correct TIN by completing the "Substitute Form W-9" set forth below, certifying that the TIN provided is correct (or that such holder is awaiting a TIN) and that (i) the holder is exempt from backup withholding, (ii) the holder has not been notified by the Internal Revenue Service that such holder is subject to a backup withholding as a result of a failure to report all interest or dividends or (iii) the Internal Revenue Service has notified the holder that such holder is no longer subject to backup withholding. If the tendering holder of Original Notes is a nonresident alien or foreign entity not subject to backup withholding, such holder must give the Company a completed Form W-8BEN Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding, or other appropriate Form W-8. These forms may be obtained from the Exchange Agent or from the Internal Revenue Service's website, www.irs.gov. If the Original Notes are in more than one name or are not in the name of the actual owner, such holder should consult the W-9 Guidelines for information on which TIN to report. If such holder does not have a TIN, such holder should consult the W-9 Guidelines for instructions on applying for a TIN, check the box in Part 2 of the Substitute Form W-9 and write "applied for" in lieu of its TIN. If backup withholding applies, the payor will withhold the appropriate percentage (currently 28%) from payments to the payee. Backup withholding is not an additional Federal income tax. Rather, the Federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in overpayment of taxes, a refund may be obtained from the Internal Revenue Service. 6. TRANSFER TAXES. Holders who tender their Original Notes for exchange will not be obligated to pay any transfer taxes in connection therewith. If, however, Exchange Notes are to be delivered to, or are to be issued in the name of, any person other than the registered holder of the Original Notes tendered hereby, or if tendered Original Notes are registered in the name of any person other than the person signing this Letter, or if a transfer tax is imposed for any reason other than the exchange of Original Notes in connection with the Exchange Offer, the amount of any such transfer taxes (whether imposed on the registered holder or any other persons) will be payable by the tendering holder. If satisfactory evidence of payment of such 3 taxes or exemption therefrom is not submitted herewith, the amount of such transfer taxes will be billed directly to such tendering holder. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR TRANSFER TAX STAMPS TO BE AFFIXED TO THE ORIGINAL NOTES SPECIFIED IN THIS LETTER. 7. WAIVER OF CONDITIONS. The Company reserves the right to waive satisfaction of any or all conditions enumerated in the Prospectus. 8. NO CONDITIONAL TENDERS. No alternative, conditional, irregular or contingent tenders will be accepted. All tendering holders of Original Notes, by execution of this Letter, shall waive any right to receive notice of the acceptance of their Original Notes for exchange. None of the Company, the Exchange Agent or any other person is obligated to give notice of any defect or irregularity with respect to any tender of Original Notes nor shall any of them incur any liability for failure to give any such notice. 9. MUTILATED, LOST, STOLEN OR DESTROYED ORIGINAL NOTES. Any holder whose Original Notes have been mutilated, lost, stolen or destroyed should contact the Exchange Agent at the address indicated above for further instructions. 10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions relating to the procedure for tendering, as well as requests for additional copies of the Prospectus and this Letter, may be directed to the Exchange Agent, at the address and telephone number indicated above. 4 TO BE COMPLETED BY ALL TENDERING HOLDERS (SEE INSTRUCTION 5) PAYOR'S NAME: MILACRON INC.
- ------------------------------------------------------------------------------------------------ SUBSTITUTE PART 1 -- PLEASE PROVIDE YOUR TIN: FORM W-9 TIN IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND DATING ---------------------------------- BELOW Social Security Number or Employer Identification Number -------------------------------------------------------------------- Department of the Treasury PART 2 -- TIN Applied For [ ] Internal Revenue Service -------------------------------------------------------------------- Payor's Request for CERTIFICATION -- UNDER PENALTIES OF PERJURY, I CERTIFY THAT: Taxpayer Identification (1) The number shown on this form is my correct Taxpayer Number ('TIN') and Identification Number (or I am waiting for a number to be issued to Certification me), Name: (2) I am not subject to backup withholding because: (a) I am exempt Address: from backup withholding, or (b) I have not been notified by the Internal Revenue Service (the 'IRS') that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding, and (3) I am a U.S. person (including a U.S. resident alien). Signature Date -------------------------------------- -------------------- - ------------------------------------------------------------------------------------------------ You must cross out item (2) of the above certification if you have been notified by the IRS that you are subject to backup withholding because of under reporting of interest or dividends on your tax returns and you have not been notified by the IRS that you are no longer subject to backup withholding. - ------------------------------------------------------------------------------------------------
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 2 OF SUBSTITUTE FORM W-9. CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (a) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office or (b) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number by the time of payment, a percentage of all reportable payments (currently 28%) made to me thereafter will be withheld until I provide a number. Signature ---------------------------------------- Date -------------------- EX-99.2 70 y98028exv99w2.txt FORM OF NOTICE OF GUARANTEED DELIVERY EXHIBIT 99.2 NOTICE OF GUARANTEED DELIVERY FOR TENDER OF 11 1/2% SENIOR SECURED NOTES DUE 2011 OF MILACRON INC. PURSUANT TO THE PROSPECTUS DATED , 2004 This Notice of Guaranteed Delivery, or one substantially equivalent to this form, must be used to tender Original Notes (as defined below) pursuant to the Exchange Offer (as defined below) described in the prospectus dated , 2004 (the "Prospectus") of Milacron Inc., a Delaware corporation (the "Company"), if (i) certificates for the outstanding 11 1/2% Senior Secured Notes due 2011 of the Company (the "Original Notes") are not immediately available, (ii) time will not permit the Original Notes, the letter of transmittal and all other required documents to be delivered to U.S. Bank National Association (the "Exchange Agent") prior to 5:00 p.m., New York City time, on , 2004 or such later date and time to which the Exchange Offer may be extended (the "Expiration Date"), or (iii) the procedures for delivery by book-entry transfer cannot be completed on a timely basis. This Notice of Guaranteed Delivery, or one substantially equivalent to this form, must be delivered by hand or sent by facsimile transmission or mail to the Exchange Agent, and must be received by the Exchange Agent prior to the Expiration Date. See "The Exchange Offer -- Guaranteed Delivery Procedures" in the Prospectus. Capitalized terms used but not defined herein shall have the same meaning given them in the Prospectus. THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS: U.S. BANK NATIONAL ASSOCIATION By Registered or Certified Mail, Overnight Courier or Hand: U.S. Bank National Association Attn: Shauna Thilmany/Specialized Finance Dept. Mailcode: EP-MN-WS2N 60 Livingston Avenue St. Paul, MN 55107 By Facsimile: (651)495-8158 For information, call: (800)934-6802 DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF GUARANTEED DELIVERY VIA FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES, IS AT THE RISK OF THE HOLDER. INSTEAD OF DELIVERY BY MAIL, WE RECOMMEND USE OF AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, YOU SHOULD ALLOW SUFFICIENT TIME TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THE LETTER OF TRANSMITTAL CAREFULLY BEFORE YOU COMPLETE THIS NOTICE OF GUARANTEED DELIVERY. This Notice of Guaranteed Delivery is not to be used to guarantee signatures. If a signature on a letter of transmittal is required to be guaranteed by an "Eligible Institution" under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box on the letter of transmittal. Ladies and Gentlemen: The undersigned acknowledges receipt of the Prospectus and the related letter of transmittal (the "Letter of Transmittal") which describes the offer by the Company (the "Exchange Offer") to exchange $1,000 in principal amount of registered 11 1/2% Senior Secured Notes due 2011 of the Company (the "Exchange Notes") for each $1,000 in principal amount of Original Notes. The undersigned hereby tenders to the Company, upon the terms and subject to the conditions set forth in the Prospectus and the Letter of Transmittal, the aggregate principal amount of Original Notes indicated below pursuant to the guaranteed delivery procedures set forth in the Prospectus under the caption "The Exchange Offer -- Guaranteed Delivery Procedures." The undersigned understands that no withdrawal of a tender of Original Notes may be made after 5:00 p.m., New York City time, on the Expiration Date. The undersigned understands that for a withdrawal of a tender of Original Notes to be effective, a written notice of withdrawal that complies with the requirements of the Exchange Offer must be timely received by the Exchange Agent at one of its addresses specified on the cover of this Notice of Guaranteed Delivery prior to 5:00 p.m., New York City time, on the Expiration Date. The undersigned understands that the exchange of Original Notes for Exchange Notes pursuant to the Exchange Offer will be made only after timely receipt by the Exchange Agent of (1) such Original Notes (or confirmation of book-entry transfer of such Original Notes into the Exchange Agent's account at The Depository Trust Company ("DTC")) and (2) a Letter of Transmittal (or facsimile thereof) with respect to such Original Notes, properly completed and duly executed, with any required signature guarantees, and any other documents required by the Letter of Transmittal or, in lieu thereof, a message from DTC stating that the tendering holder has expressly acknowledged receipt of, and agreement to be bound by and held accountable under, the Letter of Transmittal. All authority conferred or agreed to be conferred by this Notice of Guaranteed Delivery shall not be affected by, and shall survive, the death or incapacity of the undersigned, and every obligation of the undersigned under this Notice of Guaranteed Delivery shall be binding on the heirs, executors, administrators, trustees in bankruptcy, personal and legal representatives, successors and assigns of the undersigned. Name(s) of Registered Holder(s): - -------------------------------------------------------------------------------- (PLEASE PRINT OR TYPE) Signature(s): - -------------------------------------------------------------------------------- Address(es): - -------------------------------------------------------------------------------- Area Code(s) and Telephone Number(s): - -------------------------------------------------------------------------------- If Original Notes will be delivered by book-entry transfer at DTC, insert Depository Account Number: - -------------------------------------------------------------------------------- Date: - -------------------------------------------------------------------------------- Certificate Number(s)* Principal Amount of Original Notes Tendered** - ------------------------------------------------ ------------------------------------------------ - ------------------------------------------------ ------------------------------------------------ - ------------------------------------------------ ------------------------------------------------

* Need not be completed if the Original Notes being tendered are in book-entry form. ** Must be in integral multiples of $1,000 principal amount. 2 This Notice of Guaranteed Delivery must be signed by the registered holder(s) of Original Notes exactly as its (their) name(s) appear(s) on certificates for Original Notes or on a security position listing as the owner of Original Notes, or by person(s) authorized to become registered holder(s) by endorsements and documents transmitted with this Notice of Guaranteed Delivery. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer or other person acting in a fiduciary or representative capacity, such person must provide the following information. Name(s): ---------------------------------------------------------------------- Signature(s): ----------------------------------------------------------------- Address(es): ------------------------------------------------------------------ DO NOT SEND ORIGINAL NOTES WITH THIS FORM. ORIGINAL NOTES SHOULD BE SENT TO THE EXCHANGE AGENT TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL. 3 GUARANTEE OF DELIVERY (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or a correspondent in the United States or an "eligible guarantor institution" within the meaning of Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), hereby (1) represents that each holder of Original Notes on whose behalf this tender is being made "own(s)" the Original Notes covered hereby within the meaning of Rule 13d-3 under the Exchange Act, (2) represents that such tender of Original Notes complies with Rule 14e-4 of the Exchange Act and (3) guarantees that the undersigned will deliver to the Exchange Agent the certificates representing the Original Notes being tendered hereby for exchange pursuant to the Exchange Offer in proper form for transfer (or a confirmation of book-entry transfer of such Original Notes into the Exchange Agent's account at the book-entry transfer facility of DTC) with delivery of a properly completed and duly executed Letter of Transmittal (or facsimile thereof), with any required signature guarantees, or in lieu of a Letter of Transmittal a message from DTC stating that the tendering holder has expressly acknowledged receipt of, and agreement to be bound by and held accountable under, the letter of transmittal, and any other documents required by the Letter of Transmittal, all within three New York Stock Exchange trading days after the Expiration Date. Name of Firm: - ------------------------------------------------ ------------------------------------- AUTHORIZED SIGNATURE Address: - ------------------------------------------------ Name: ------------------------------- PLEASE PRINT OR TYPE - ------------------------------------------------ Title: ------------------------------ Telephone No. - ------------------------------------------------ Dated: ------------------------------

The institution that completes the Notice of Guaranteed Delivery (a) must deliver the same to the Exchange Agent at its address set forth above by hand, or transmit the same by facsimile or mail, prior to the Expiration Date, and (b) must deliver the certificates representing any Original Notes (or a confirmation of book-entry transfer of such Original Notes into the Exchange Agent's account at DTC), together with a properly completed and duly executed Letter of Transmittal (or facsimile thereof) or a message from DTC stating that the tendering holder has expressly acknowledged receipt of, and agreement to be bound by and held accountable under, the letter of transmittal in lieu thereof), with any required signature guarantees, and any other documents required by the Letter of Transmittal to the Exchange Agent within the time period shown herein. Failure to do so could result in a financial loss to such institution. 4 EX-99.3 71 y98028exv99w3.txt FORM OF LETTER TO CLIENTS EXHIBIT 99.3 MILACRON INC. OFFER TO EXCHANGE UP TO $225,000,000 PRINCIPAL AMOUNT OUTSTANDING OF 11 1/2% SENIOR SECURED NOTES DUE 2011 FOR A LIKE PRINCIPAL AMOUNT OF 11 1/2% SENIOR SECURED NOTES DUE 2011 WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 PURSUANT TO THE PROSPECTUS, DATED , 2004 To Our Clients: Enclosed for your consideration is a Prospectus dated , 2004 (the "Prospectus") and the related letter of transmittal (the "Letter of Transmittal"), relating to the offer (the "Exchange Offer") of Milacron Inc., a Delaware corporation (the "Company") to exchange up to $225,000,000 aggregate principal amount of registered 11 1/2% Senior Secured Notes due 2011 of the Company, which will be freely transferable (the "Exchange Notes"), for any and all of the Company's outstanding 11 1/2% Senior Secured Notes due 2011, which have certain transfer restrictions (the "Original Notes"), upon the terms and subject to the conditions described in the Prospectus and the related Letter of Transmittal. The Exchange Offer is intended to satisfy certain obligations of the Company contained in the Registration Rights Agreement dated as of May 26, 2004, among Milacron Escrow Corporation and Credit Suisse First Boston LLC, as representative of the several purchasers listed therein, which Milacron Inc. and the guarantors listed therein entered into pursuant to a Joinder dated May 26, 2004. This material is being forwarded to you as the beneficial owner of the Original Notes carried by us for your account but not registered in your name. A TENDER OF SUCH ORIGINAL NOTES MAY ONLY BE MADE BY US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. Accordingly, we request instructions as to whether you wish us to tender on your behalf the Original Notes held by us for your account, pursuant to the terms and conditions set forth in the enclosed Prospectus and Letter of Transmittal. Please forward your instructions to us as promptly as possible in order to permit us to tender the Original Notes on your behalf in accordance with the provisions of the Exchange Offer. The Exchange Offer will expire at 5:00 p.m., New York City time, on , 2004 (the "Expiration Date"), unless extended by the Company. Any Original Notes tendered pursuant to the Exchange Offer may be withdrawn any time prior to 5:00 p.m., New York City time, on the Expiration Date. Your attention is directed to the following: 1. The Exchange Offer is for any and all Original Notes. 2. The Exchange Offer is subject to certain conditions set forth in the Prospectus in the section captioned "The Exchange Offer -- Conditions to the Exchange Offer." 3. The Exchange Offer expires at 5:00 p.m., New York City time, on the Expiration Date, unless extended by the Company. If you wish to have us tender your Original Notes, please so instruct us by completing, executing and returning to us the instruction form on the back of this letter. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR INFORMATION ONLY AND MAY NOT BE USED DIRECTLY BY YOU TO TENDER ORIGINAL NOTES. 2 INSTRUCTIONS WITH RESPECT TO THE EXCHANGE OFFER The undersigned acknowledge(s) receipt of this letter and the enclosed materials referred to herein relating to the Exchange Offer made by the Company with respect to the Original Notes. This will instruct you to tender the Original Notes held by you for the account of the undersigned, upon and subject to terms and conditions set forth in the Prospectus and the related Letter of Transmittal. Please tender the Original Notes held by you for the account of the undersigned as indicated below:
AGGREGATE PRINCIPAL AMOUNT OF ORIGINAL NOTES 11 1/2% Senior Secured Notes due 2011............ ------------------------------------------------- (MUST BE IN INTEGRAL MULTIPLE OF $1,000) [ ] Please do not tender any Original Notes held by you for the account of the undersigned Dated: , 2004 ------------------------------------------------- ------------------------------------------------- SIGNATURE(S) ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- PLEASE PRINT NAME(S) HERE ------------------------------------------------- ------------------------------------------------- ADDRESS(ES) ------------------------------------------------- AREA CODE(S) AND TELEPHONE NUMBER(S) ------------------------------------------------- TAX IDENTIFICATION OR SOCIAL SECURITY NO(S).
NONE OF THE ORIGINAL NOTES HELD BY US FOR YOUR ACCOUNT WILL BE TENDERED UNLESS WE RECEIVE WRITTEN INSTRUCTIONS FROM YOU TO DO SO. UNLESS A SPECIFIC CONTRARY INSTRUCTION IS GIVEN IN THE SPACE PROVIDED, YOUR SIGNATURE(S) HEREON SHALL CONSTITUTE AN INSTRUCTION TO US TO TENDER ALL THE ORIGINAL NOTES HELD BY US FOR YOUR ACCOUNT. 3 EX-99.4 72 y98028exv99w4.txt FORM OF LETTER TO BROKER, DEALERS ETC. EXHIBIT 99.4 MILACRON INC. OFFER TO EXCHANGE UP TO $225,000,000 PRINCIPAL AMOUNT OUTSTANDING OF 11 1/2% SENIOR SECURED NOTES DUE 2011 FOR A LIKE PRINCIPAL AMOUNT OF 11 1/2% SENIOR SECURED NOTES DUE 2011 WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 PURSUANT TO THE PROSPECTUS, DATED , 2004 To: Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: Milacron Inc., a Delaware corporation (the "Company"), hereby offers to exchange (the "Exchange Offer"), upon and subject to the terms and conditions set forth in the Prospectus dated , 2004 (the "Prospectus") and the enclosed letter of transmittal (the "Letter of Transmittal"), up to $225,000,000 aggregate principal amount of registered 11 1/2% Senior Secured Notes due 2011 of the Company, which will be freely transferable (the "Exchange Notes"), for any and all of the Company's outstanding 11 1/2% Senior Secured Notes due 2011, which have certain transfer restrictions (the "Original Notes"). The Exchange Offer is intended to satisfy certain obligations of the Company contained in the Registration Rights Agreement dated as of May 26, 2004, among Milacron Escrow Corporation and Credit Suisse First Boston LLC, as representative of the several purchasers listed therein, which Milacron Inc. and the guarantors listed therein entered into pursuant to a Joinder dated May 26, 2004. We are requesting that you contact your clients for whom you hold Original Notes regarding the Exchange Offer. For your information and for forwarding to your clients for whom you hold Original Notes registered in your name or in the name of your nominee, or who hold Original Notes registered in their own names, we are enclosing the following documents: 1. Prospectus dated , 2004; 2. The Letter of Transmittal for your use and for the information of your clients; 3. A Notice of Guaranteed Delivery to be used to accept the Exchange Offer if certificates for Original Notes are not immediately available or time will not permit all required documents to reach U.S. Bank National Association (the "Exchange Agent") prior to the Expiration Date (as defined below) or if the procedure for book-entry transfer cannot be completed on a timely basis; 4. A form of letter which may be sent to your clients for whose account you hold Original Notes registered in your name or the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Exchange Offer; 5. Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9; and 6. Return envelopes addressed to U.S. Bank National Association, the Exchange Agent for the Exchange Offer. YOUR PROMPT ACTION IS REQUESTED. THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON , 2004 (THE "EXPIRATION DATE"), UNLESS EXTENDED BY THE COMPANY. ANY ORIGINAL NOTES TENDERED PURSUANT TO THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. To participate in the Exchange Offer, a duly executed and properly completed Letter of Transmittal (or facsimile thereof or a message from The Depository Trust Company stating that the tendering holder has expressly acknowledged receipt of, and agreement to be bound by and held accountable under, the Letter of Transmittal), with any required signature guarantees, and any other documents required by the Letter of Transmittal, must be sent to the Exchange Agent and certificates representing the Original Notes must be delivered to the Exchange Agent, all in accordance with the instructions set forth in the Letter of Transmittal and the Prospectus. If holders of Original Notes wish to tender but it is impracticable for them to forward their certificates for Original Notes prior to the expiration of the Exchange Offer or to comply with the book-entry transfer procedures on a timely basis, a tender may be effected by following the guaranteed delivery procedures described in the Prospectus under "The Exchange Offer -- Guaranteed Delivery Procedures." Any inquiries you may have with respect to the Exchange Offer or requests for additional copies of the enclosed materials should be directed to the Exchange Agent for the Original Notes, at its address and telephone number set forth on the front of the Letter of Transmittal. Very truly yours, Milacron Inc. NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON AS AN AGENT OF THE COMPANY OR THE EXCHANGE AGENT, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON BEHALF OF ANY OF THEM WITH RESPECT TO THE EXCHANGE OFFER, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS OR THE LETTER OF TRANSMITTAL. 2 EX-99.5 73 y98028exv99w5.txt FORM W-9 EXHIBIT 99.5 GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYOR. Social Security numbers and individual taxpayer identification numbers (ITIN) have nine digits separated by two hyphens: i.e. 000-00-0000. Employer identification numbers have nine digits separated by only one hyphen, i.e. 00-0000000. The table below will help determine the number to give the payor.
- --------------------------------------------------------------- GIVE THE SOCIAL SECURITY OR ITIN NUMBER FOR THIS TYPE OF ACCOUNT: OF -- - --------------------------------------------------------------- 1. An individual's account The individual 2. Two or more individuals The actual owner of the (joint account) account or, if combined funds, any one of the individuals(1) 3. Custodian account of a minor The minor(2) (Uniform Gift to Minors Act) 4. a. The usual revocable The grantor-trustee(1) savings trust account (grantor is also trustee) b. So-called trust account The actual owner(1) that is not a legal or valid trust under State law 5. Sole proprietorship account The owner(3) - ---------------------------------------------------------------

------------------------------------------------------------------------------- GIVE THE EMPLOYER IDENTIFICATION NUMBER FOR THIS TYPE OF ACCOUNT: OF -- ------------------------------------------------------------------------------- 6. A valid trust, estate, or pension The legal entity(4) trust 7. Corporate account The corporation 8. Association, club, religious, The organization charitable, educational or other tax-exempt organization account 9. Partnership account held in the The partnership name of the partnership 10. A broker or registered nominee The broker or nominee 11. Account with the Department of The public entity Agriculture in the name of a public entity (such as a State or local government, school district, or prison) that receives agricultural program payments - ---------------------------------------------------------------------------------
(1) List all names first and circle the name of the person whose number you furnish. If only one person on a joint account has a Social Security number, that person's number must be furnished. (2) Circle the minor's name and furnish the minor's Social Security number. (3) The owner's name must be shown. The business or "doing business as" name may also be entered. Use either the owner's Social Security number or Employer Identification number (if available). (4) List first and circle the name of the legal trust, estate, or pension trust. Do not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title. NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 OBTAINING A NUMBER If you don't have a taxpayer identification number or you don't know your number, obtain Form SS-5, Application for a Social Security Card, Form W-7, Application for IAS Individual Taxpayer Identification Number or Form SS-4, Application for Employer Identification Number (for business and all other entities), at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. To complete Substitute Form W-9 if you do not have a taxpayer identification number, write "Applied For" in the space for the taxpayer identification number, sign and date the form, and give it to the requester. Generally, you will then have 60 days to obtain a taxpayer identification number and furnish it to the requester. If the requester does not receive your taxpayer identification number within 60 days, backup withholding, if applicable, will begin and will continue until you furnish your taxpayer identification number to the requester. PAYEES EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from backup withholding on all payments of interest include the following: - A corporation. - A financial institution. - An organization exempt from tax under section 501(a) of the Internal Revenue Code of 1986, as amended (the "Code"), or an individual retirement plan, or a custodial account under Section 403(b)(7), if the account satisfies the requirements of Section 401(f)(2). - The United States or any agency or instrumentalities. - A state, the District of Columbia, a possession of the United States, or any political subdivision or instrumentality thereof. - A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof. - An international organization or any agency, or instrumentality thereof. - A registered dealer in securities or commodities registered in the United States, the District of Columbia or a possession of the United States. - A real estate investment trust. - A common trust fund operated by a bank under section 584(a) of the Code. - An exempt charitable remainder trust, or a non-exempt trust described in section 4947(a)(I) of the Code. - An entity registered at all times under the Investment Company Act of 1940. - A foreign central bank of issue. - A middleman known in the investment community as a nominee or custodian. Payments of interest not generally subject to backup withholding include the following: - Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payor's trade or business and you have not provided your correct taxpayer identification number to the payor. - Payments of tax-exempt interest (including exempt-interest dividends under Section 852 of the Code). - Payments described in Section 6049(b)(5) of the Code to nonresident aliens. - Payments made by certain foreign organizations. - Mortgage or student loan interest paid to you. Exempt payees described above should file a Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYOR, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM. SIGN AND DATE THE FORM AND RETURN IT TO THE PAYOR. IF YOU ARE A NONRESIDENT ALIEN OR A FOREIGN ENTITY NOT SUBJECT TO BACKUP WITHHOLDING FILE WITH A PAYOR A COMPLETED INTERNAL REVENUE FORM W-8BEN (CERTIFICATE FOREIGN STATUS OF BENEFICIAL OWNER FOR UNITED STATES TAX WITHHOLDING) OR OTHER APPROPRIATE FORM W-8). Certain payments other than interest, dividends, and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see the regulations under Section 6041, 6041A, 6042, 6044, 6045, 6049, 6050(A), and 6050(N) of the Code and the regulations promulgated thereunder. PRIVACY ACT NOTICE -- Section 6109 requires most recipients of dividends, interest, or other payments to give taxpayer identification numbers to payors who must report the payments to the IRS. The IRS uses the numbers for identification purposes. Payors must be given the numbers whether or not recipients are required to file tax returns. Payors must generally withhold between 28% and 31%, depending on the year, of taxable interest, dividends and certain other payments to a payee who does not furnish a taxpayer identification number to a payor. Certain penalties may also apply. PENALTIES (1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. -- If you fail to furnish your taxpayer identification number to a payor, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to wilful neglect. (2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. -- If you make a false statement with no reasonable basis that results in no imposition of backup withholding, you are subject to a penalty of $500. (3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. -- Wilfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE. 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Delaware	3559	No. 31-1062125
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(IRS Employer Identification Number)






		Proposed Maximum	Proposed Maximum
Title of Each Class of Securities	Amount to be	Offering Price Per	Aggregate Offering	Amount of
to be Registered	Registered	Unit(1)	Price(1)	Registration Fee(2)


11 1/2% Senior Secured Notes due 2011	$225,000,000	100%	$225,000,000	$28,507.50

Guarantees of 11 1/2% Senior Secured Notes due 2011(3)	(4)	(4)	(4)	(5)


Background		On May 26, 2004, the proceeds of a private placement of the original notes were placed into escrow. On June 10, 2004 the conditions to release of the funds from escrow to us were satisfied. In connection with that private placement and the release of proceeds from escrow, we entered into a registration rights agreement in which we agreed, among other things, to complete an exchange offer.

The Exchange Offer		We are offering to exchange our exchange notes which have been registered under the Securities Act of 1933 for a like principal amount of our outstanding, unregistered original notes. Original notes may be tendered in integral multiples of $1,000 principal amount. As of the date of this prospectus, $225.0 million in aggregate principal amount of our original notes are outstanding.

Resale of Exchange Notes		We believe the exchange notes issued pursuant to the exchange offer in exchange for the original notes may be offered for resale, resold and otherwise transferred by you without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that:

		• you are acquiring the exchange notes in the ordinary course of your business;

		• you have not engaged in, do not intend to engage in and have no arrangement or understanding with any person to participate in the distribution of the exchange notes; and

		• you are not our affiliate as defined in Rule 405 of the Securities Act.

		Each participating broker-dealer that receives exchange notes for its own account pursuant to the exchange offer in exchange for original notes that were acquired as a result of market-making or other trading activity must acknowledge that it will deliver a prospectus in connection with any resale of the exchange notes. See “Plan of Distribution.”

Consequences of Failure to Exchange		Original notes that are not tendered in the exchange offer or are not accepted for exchange will continue to bear legends restricting their transfer. You will not be able to offer or sell the original notes unless:

		• pursuant to an exemption from the requirements of the Securities Act; or

		• the original notes are registered under the Securities Act.

		After the exchange offer is closed, we will no longer have an obligation to register the original notes, except under some limited circumstances. See “Risk Factors — If you fail to exchange your original notes, they will continue to be restricted securities and may become less liquid.”


Expiration Date		The exchange offer will expire at 5:00 p.m., New York City time, on , 2004, unless we decide to extend the exchange offer, in which case the term “Expiration Date” shall mean the latest date and time to which the exchange offer is extended.

Certain Conditions to the Exchange Offer		The exchange offer is subject to certain customary conditions, which we may waive.

Special Procedures for Beneficial Holders		If you beneficially own original notes which are registered in the name of a broker, dealer, commercial bank, trust company, or other nominee and you wish to tender in the exchange offer, you should contact such registered holder promptly and instruct such person to tender on your behalf. If you wish to tender in the exchange offer on your own behalf, you must, prior to completing and executing the letter of transmittal and delivering your original notes, either arrange to have the original notes registered in your name or obtain a properly completed bond power from the registered holder. The transfer of registered ownership may take a considerable amount of time.

Withdrawal Rights		You may withdraw your tender of original notes at any time before the exchange offer expires.

Accounting Treatment		We will not recognize any gain or loss for accounting purposes upon the completion of the exchange offer. The expenses of the exchange offer that we pay will increase our deferred financing costs in accordance with generally accepted accounting principles. See “The Exchange Offer — Accounting Treatment.”

Federal Income Tax Consequences		The exchange of your original notes for exchange notes should not be a taxable event for U.S. Federal income tax purposes.

Use of Proceeds		We will not receive any proceeds from the exchange or the issuance of exchange notes in connection with the exchange offer.

Exchange Agent		U.S. Bank National Association is serving as the exchange agent in connection with the exchange offer.


Issuer		Milacron Inc.

Notes Offered		$225,000,000 of 11 1/2% Senior Secured Notes due 2011.

Maturity Date		May 15, 2011.

Interest		Interest accrues on the notes at a rate of 11 1/2% per annum, and will be payable semiannually in arrears on May 15 and November 15 of each year, commencing on November 15, 2004.

Guarantees		The notes are jointly and severally guaranteed on a senior secured basis by all of our existing U.S. restricted subsidiaries that are not immaterial subsidiaries and any additional restricted subsidiaries that guarantee our other indebtedness, which additional subsidiar-


	Page

WHERE YOU CAN FIND MORE INFORMATION		i
FORWARD-LOOKING STATEMENTS		ii
INDUSTRY AND MARKET DATA		iii
PROSPECTUS SUMMARY		1
RISK FACTORS		13
USE OF PROCEEDS		29
CAPITALIZATION		30
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA		33
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS		38
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		47
BUSINESS		78
MANAGEMENT		85
PRINCIPAL HOLDERS OF VOTING SECURITIES		95
SHARE OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS		98
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS		100
PERFORMANCE GRAPH		101
DESCRIPTION OF CERTAIN OTHER INDEBTEDNESS		102
THE EXCHANGE OFFER		106
DESCRIPTION OF SENIOR SECURED NOTES		113
CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS		171
PLAN OF DISTRIBUTION		172
LEGAL MATTERS		172
INDEPENDENT AUDITORS		172
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS		F-1
ARTICLES OF INCORPORATION
ARTICLES OF INCORPORATION
CODE OF REGULATIONS
CERTIFICATE OF INCORPORATION
BYLAWS
ARTICLE OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
RESTATED ARTICLES OF INCORPORATION
AMENDED AND RESTATED BYLAWS
ARTICLES OF AMALGAMATION
BYLAWS
LETTERS PATENT
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
ARTICLES OF INCORPORATION
BYLAWS
CERTIFICATE OF INCORPORATION
BYLAWS
INDENTURE
SUPPLEMENTAL INDENTURE
REGISTRATION RIGHTS AGREEMENT
JOINDER TO REGISTRATION RIGHTS AGREEMENT
SECURITY AGREEMENT
SECURITY AGREEMENT
PLEDGE AGREEMENT
INTERCREDITOR AGREEMENT
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS
MORTGAGE
MORTGAGE
MORTGAGE
MORTGAGE
MORTGAGE
OPEN-END MORTGAGE
OPEN-END MORTGAGE
OPEN-END MORTGAGE
OPEN-END MORTGAGE
OPEN-END MORTGAGE
OPEN-END MORTGAGE
STATEMENTS REGARDING COMPUTATION OF EARNINGS
SUBSIDIARES
CONSENT OF ERNST & YOUNG
FORM T-1
FORM OF LETTER OF TRANSMITTAL
FORM OF NOTICE OF GUARANTEED DELIVERY
FORM OF LETTER TO CLIENTS
FORM OF LETTER TO BROKER, DEALERS ETC.
FORM W-9


Certain Covenants		The indenture contains covenants that limit our ability and the ability of our restricted subsidiaries to:

		• incur additional indebtedness;

		• create liens;

		• engage in sale-leaseback transactions;

		• pay dividends or make other equity distributions;

		• purchase or redeem capital stock;

		• make investments;

		• sell assets;

		• engage in transactions with affiliates; or

		• effect a consolidation or merger.

		These covenants are subject to a number of important limitations, exceptions and qualifications, which are described in the “Description of Senior Secured Notes” section of this prospectus. See “Description of Senior Secured Notes — Certain Covenants.”

Original Issue Discount		The original notes were issued at a discount from their stated principal amount for United States federal income tax purposes. Consequently, original issue discount will be included in the gross income of a U.S. holder of notes for United States federal income tax purposes in advance of the receipt of cash payments on the notes.

No Public Market		There is no public trading market for the notes and we do not intend to apply for listing of the exchange notes on any national securities exchange or for quotation of the exchange notes on any automated dealer quotation system.



																Three Months
			Year Ended December 31,													Ended March 31,

			1999		2000		2001			2002			2003			2003			2004


			(Dollars in millions, except per share amounts)
Summary of Operations:
Sales			$	994.3	$	974.5	$	755.2		$	693.2		$	739.7		$	190.2		$	188.9
Earnings (loss) from continuing operations before cumulative effect of change in method of accounting				60.6		48.8		(28.7	)		(18.4	)		(184.5	)		(7.6	)		(16.0	)
	Per common share
		Basic		1.64		1.39		(0.87	)		(0.56	)		(5.49	)		(0.23	)		(0.47	)
		Diluted(1)		1.63		1.39		(0.87	)		(0.56	)		(5.49	)		(0.23	)		(0.47	)
Earnings (loss) from discontinued operations(2)				9.5		23.5		(7.0	)		(16.8	)		(7.2	)		(0.7	)		(0.6	)
	Per common share
		Basic		0.26		0.67		(0.21	)		(0.50	)		(0.21	)		(0.02	)		(0.02	)
		Diluted(1)		0.26		0.67		(0.21	)		(0.50	)		(0.21	)		(0.02	)		(0.02	)
Cumulative effect of change in method of accounting(3)				—		—		—			(187.7	)		—			—			—
	Per common share
		Basic		—		—		—			(5.61	)		—			—			—
		Diluted(1)		—		—		—			(5.61	)		—			—			—
Net earnings (loss)				70.1		72.3		(35.7	)		(222.9	)		(191.7	)		(8.3	)		(16.6	)
	Per common share
		Basic		1.90		2.06		(1.08	)		(6.67	)		(5.70	)		(0.25	)		(0.49	)
		Diluted(1)		1.89		2.06		(1.08	)		(6.67	)		(5.70	)		(0.25	)		(0.49	)



	Year Ended
	December 31,

	2002			2003


	(In millions)
Gain on sale of Valenite	$	31.3		$	0.4
Loss on sale of Widia and Werkö		(14.9	)		0.9
Loss on sale of round metalcutting tools business		(4.7	)		(2.2	)
Estimated loss on sale of grinding wheels business		(5.2	)		1.0
Adjustment of reserves related to the 1998 divestiture of the machine tools segment		1.9			(0.9	)

Net gain (loss) on divestitures	$	8.4		$	(0.8	)


						Three Months
				Year Ended		Ended
				December 31,		March 31,
				2003		2004


				(In thousands)
Historical dividends on 4% Cumulative Preferred Stock				$	240.0	$	60.0
	Adjustment for Refinancing Transactions:
		Dividends on Series B Preferred Stock(a)			6,000.0		1,500.0

			Pro forma for Refinancing Transactions	$	6,240.0	$	1,560.0


	*If you fail to exchange your original notes, they will continue to be restricted securities and may become less liquid.*


	If our cash flow available to service our debt does not significantly increase from levels in 2003, we may not be able to service our debt with cash from operating activities, which may cause us to default on the notes and our other debt instruments.


	*Our liquidity depends on the availability of borrowings under our asset based facility, which is subject to the discretion of the administrative agent thereunder.*


	Our substantial level of indebtedness may adversely affect our financial condition, limit our ability to grow and compete and prevent us from fulfilling our obligations under the notes and our other indebtedness.


	Despite current indebtedness levels, we and our subsidiaries may still be able to incur substantially more debt. This could further exacerbate the risks associated with our substantial leverage.


	*Restrictions and covenants in debt agreements limit our ability to take certain actions.*


	*The notes are effectively junior to the indebtedness and other liabilities of our nonguarantor subsidiaries.*


	The lien ranking provisions of the security documents relating to the collateral securing the notes on a second priority basis limit the rights of holders of the notes with respect to that collateral.


	We cannot assure you that the proceeds from the sale of the collateral securing the notes would be sufficient to satisfy the amounts due on the notes in the event of a default, which could adversely affect the rights of holders of the notes in a bankruptcy proceeding.


	In the event of a bankruptcy of us or any subsidiary guarantor, holders of the notes may be deemed to have an unsecured claim to the extent that our obligations in respect of the notes exceed the fair value of the collateral securing the notes.


	*In the event of a bankruptcy of us or any guarantor, the ability of the holders of the notes to realize upon the collateral will be subject to certain bankruptcy law limitations.*


	Federal and state statutes allow courts, under specific circumstances, to void debts, including guarantees, and liens that secure the debt and guarantees and require noteholders to return payments received from us or the guarantors. The guarantees will contain terms intended to limit the amount guaranteed to the extent necessary to prevent the guarantees from constituting fraudulent conveyances.


	*It may be difficult for you to effect service of process or enforce civil liabilities against non-U.S. guarantors or other parties.*


	If there is a change of control, we may not have the ability to raise the funds necessary to permit us to consummate the change of control offer required by the indenture governing the notes.


	Because the original notes were issued with original issue discount, holders of the notes will be required to pay tax on amounts included in gross income before cash payments on the notes are received.


	*You cannot be sure that an active trading market will develop for the exchange notes.*


	“Ownership change” for U.S. federal income tax purposes will cause utilization of our tax loss carryforwards and other tax attributes to be substantially delayed, which will increase income tax expense and decrease available cash in future years.


	*Many of our customers are in cyclical industries currently experiencing significant downturns, which has resulted in substantially reduced demand for our products.*


	If a large portion of our North American and Western European customers outsource their manufacturing activities to areas where we do not currently have manufacturing operations, we may encounter difficulties keeping these customers.


	We operate in highly competitive industries, many of which are currently subject to intense price competition, and if we are unable to compete successfully our results of operations could fail to improve or could deteriorate further.


	*We may encounter difficulties in our restructuring and cost-savings efforts, which could prevent us from achieving our anticipated cost savings.*


	*Our significant international operations subject us to risks such as unfavorable political, regulatory, labor and tax conditions.*


	Our operations are conducted worldwide and our results of operations are subject to currency translation risk and currency transaction risk that could adversely affect our financial condition and results of operations.


	*Our operations depend to a great extent on the economy of the European and Asian markets. These economies may not be as stable as that of the U.S.*


	Our principal U.S. pension plan is underfunded, which we expect will require us to make cash contributions to the plan which will reduce the cash available for our business, and adverse equity market conditions may increase our pension liability and expense.