8-K

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934.

Date of Report (Date of Earliest Event Reported): July 9, 2003

WACKENHUT CORRECTIONS CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Florida	1-14260	65-0043078
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

621 NW 53rd Street, Suite 700, Boca Raton, Florida	33487
(Address of Principal Executive Offices)	(Zip Code)

(Registrant’s Telephone Number, Including Area Code) (561) 893-0101

Not Applicable

(Former Name or Former Address, if Changed since Last Report)

Item 5. Other Events and Required FD Disclosure

     On July 9, 2003, Wackenhut Corrections Corporation (“the Company”) completed three previously announced transactions (collectively, the “Transactions”): (i) the refinancing of its senior secured credit facility through the execution of an Amended and Restated Credit Agreement (the “Credit Agreement”), by and among the Company, as Borrower, BNP Paribas, as Administrative Agent, Syndication Agent and Lead Arranger, Bank of America, N.A. and Southtrust Bank, as Co-Syndication Agents, Comerica Bank, as Co-Documentation Agent, and the lenders who are, or may from time to time become, a party thereto; (ii) the sale of $150 million in aggregate principal amount of ten-year, 8 1/4% senior unsecured notes in a private offering (the “Offering”) to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended (the “Securities Act”) and to persons outside the United States pursuant to Regulation S promulgated under the Securities Act; and (iii) the repurchase for $132 million of 12,000,000 shares of its common stock from Group 4 Falck A/S (the “Repurchase”).

     The Credit Agreement consists of a $100 million 6-year term loan (the “Term Loan B”) and a $50 million 5-year revolver (the “Revolver”). The interest rate for the Term Loan B and the Revolver is LIBOR plus 3%. The net proceeds from the Offering and the funds borrowed under the Term Loan B, along with cash on hand, were used to refinance amounts outstanding under the Company’s former senior secured credit facility, complete the Repurchase and pay the fees and expenses related to the Transactions. The Credit Agreement is filed with this report as Exhibit 10.1 and is incorporated herein by reference. The Company’s press release issued in connection with the completion of the Credit Agreement and the Offering is filed with this report as Exhibit 99.1 and is incorporated herein by reference. The Company’s press release issued in connection with the completion of the Repurchase is filed with this report as Exhibit 99.2 and is incorporated herein by reference.

     The Company is including the following cautionary statement in this Form 8-K to make applicable and take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 for any forward-looking statement made by, or on behalf of, the Company. This Form 8-K Report contains forward-looking statements regarding future events and the future performance of the Company that involve risks and uncertainties that could materially affect actual results. Investors should refer to documents that the Company files from time to time with the Securities and Exchange Commission for a description of certain factors that could cause actual results to vary from current expectations and forward-looking statements contained in this Form 8-K Report. Such factors include, but are not limited to: (1) risks associated with the Company’s ability to control operating costs associated with contract start-ups; (2) the Company’s ability to timely open facilities as planned, profitably manage such facilities and successfully integrate such facilities into the Company’s operations without substantial costs; (3) the Company’s ability to win management contracts for which it has submitted proposals and to retain existing management contracts; (4) the Company’s ability to obtain future financing on acceptable terms; (5) the Company’s ability to sustain company-wide occupancy rates at its facilities; and (6) other factors contained in the Company’s Securities and Exchange Commission filings, including the forms 10-K, 10-Q and 8-K reports.

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Item 7. Financial Statements And Exhibits

(c) Exhibits.

Exhibit No	Description
1.1	Purchase Agreement, dated July 1, 2003, by and among Wackenhut Corrections Corporation and BNP Paribas Securities Corp., Lehman Brothers Inc., First Analysis Securities Corporation, SouthTrust Securities, Inc. and Comerica Securities, Inc. as the Initial Purchasers
4.1	Indenture, dated July 9, 2003, by and between Wackenhut Corrections Corporation and The Bank of New York, as Trustee, relating to 8 1/4% Senior Notes due 2013
4.2	Registration Rights Agreement, dated July 9, 2003, by and among Wackenhut Corrections Corporation and BNP Paribas Securities Corp., Lehman Brothers Inc., First Analysis Securities Corporation, SouthTrust Securities, Inc. and Comerica Securities, Inc.
10.1	Amended and Restated Credit Agreement, dated July 9, 2003, by and among Wackenhut Corrections Corporation, BNP Paribas, as Administrative Agent, Syndication Agent and Lead Arranger, Bank of America, N.A. and Southtrust Bank, as Co-Syndication Agents, Comerica Bank, as Co-Documentation Agent, and the lenders who are, or may from time to time become, a party thereto
99.1	Press Release dated July 9, 2003
99.2	Press Release dated July 9, 2003

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	WACKENHUT CORRECTIONS CORPORATION
July 29, 2003	By:/s/ John G. O’Rourke
Date	John G. O’Rourke Senior Vice President and Chief Financial Officer (Principal Financial Officer and duly authorized signatory)

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EXHIBIT INDEX

Exhibit No	Description
1.1	Purchase Agreement, dated July 1, 2003, by and among Wackenhut Corrections Corporation and BNP Paribas Securities Corp., Lehman Brothers Inc., First Analysis Securities Corporation, SouthTrust Securities, Inc. and Comerica Securities, Inc. as the Initial Purchasers
4.1	Indenture, dated July 9, 2003, by and between Wackenhut
	Corrections Corporation and The Bank of New York, as Trustee, relating to 8 1/4% Senior Notes due 2013
4.2	Registration Rights Agreement, dated July 9, 2003, by and among Wackenhut Corrections Corporation and BNP Paribas Securities Corp., Lehman Brothers Inc., First Analysis Securities Corporation, SouthTrust Securities, Inc. and Comerica Securities, Inc.
10.1	Amended and Restated Credit Agreement, dated July 9, 2003, by and among Wackenhut Corrections Corporation, BNP Paribas, as Administrative Agent, Syndication Agent and Lead Arranger, Bank of America, N.A. and Southtrust Bank, as Co-Syndication Agents, Comerica Bank, as Co-Documentation Agent, and the lenders who are, or may from time to time become, a party thereto
99.1	Press Release dated July 9, 2003
99.2	Press Release dated July 9, 2003

5 EX-1.1 3 g84060exv1w1.txt EX-1.1 PURCHASE AGREEMENT EXHIBIT 1.1 $150,000,000 WACKENHUT CORRECTIONS CORPORATION 8 1/4% SENIOR NOTES DUE 2013 PURCHASE AGREEMENT July 1, 2003 BNP PARIBAS SECURITIES CORP. LEHMAN BROTHERS INC. FIRST ANALYSIS SECURITIES CORPORATION SOUTHTRUST SECURITIES, INC. COMERICA SECURITIES, INC. c/o BNP Paribas Securities Corp. The Equitable Tower 787 Seventh Avenue New York, NY 10019 Ladies and Gentlemen: Wackenhut Corrections Corporation, a Florida corporation (the "COMPANY"), proposes, upon the terms and conditions set forth herein, to issue and sell to you (the "OFFERING"), as the initial purchasers (the "INITIAL PURCHASERS"), $150,000,000 in aggregate principal amount of its 8 1/4% Senior Notes due 2013 (the "NOTES"). The Notes will (i) have terms and provisions that are summarized in the Offering Memorandum (as defined below) and (ii) are to be issued pursuant to an Indenture (the "INDENTURE"), to be dated as of July 9, 2003, to be entered into between the Company and The Bank of New York, as trustee (the "TRUSTEE"). This is to confirm the agreement concerning the purchase of the Notes from the Company by the Initial Purchasers. As described in the Offering Memorandum, the net proceeds from the Offering, together with cash on hand and $100.0 million of the borrowings under an amendment (the "AMENDED SENIOR CREDIT FACILITY") to the Company's senior secured credit facility (the "EXISTING SENIOR CREDIT FACILITY") will be used by the Company to (i) repurchase (the "SHARE REPURCHASE") up to 12.0 million shares of its common stock, par value $0.01 per share (the "COMMON STOCK"), from Group 4 Falck, its majority shareholder (ii) refinance (the "REFINANCING") $125.0 million of borrowings outstanding under the Existing Senior Credit Facility (the Offering, the Amended Senior Credit Facility, the Share Repurchase and the Refinancing are collectively referred to in this Agreement as the "TRANSACTIONS") and (iii) pay fees and expenses related to the Transactions. 1. PRELIMINARY OFFERING MEMORANDUM AND OFFERING MEMORANDUM. The Notes will be offered and sold to the Initial Purchasers without registration under the Securities Act of 1933, as amended (the "ACT"), in reliance on an exemption pursuant to Section 4(2) under the Act. The Company has prepared a preliminary offering memorandum, dated June 18, 2003 (the "PRELIMINARY OFFERING MEMORANDUM"), and an offering memorandum, dated July 1, 2003 (the "OFFERING MEMORANDUM"), setting forth information regarding the Company, the Notes, the Exchange Notes (as defined herein) and the Transactions. The Company hereby confirms that it has authorized the use of the Preliminary Offering Memorandum and the Offering Memorandum in connection with the offering and resale of the Notes by the Initial Purchasers. It is understood and acknowledged that upon original issuance thereof, and until such time as the same is no longer required under the applicable requirements of the Act, the Notes (and all securities issued in exchange therefore (other than the Exchange Notes), in substitution thereof) shall bear a legend substantially in the form of the following (along with such other legends as the Initial Purchasers and their counsel deem necessary): THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING ITS NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A 2 UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A INSIDE THE UNITED STATES, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THIS TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. You have advised the Company that you will make offers (the "EXEMPT RESALES") of the Notes purchased by you hereunder on the terms set forth in the Offering Memorandum, as amended or supplemented, solely to (i) persons whom you reasonably believe to be "qualified institutional buyers" as defined in Rule 144A under the Act ("QIBS") and (ii) outside the United States to certain persons in offshore transactions in reliance on Regulation S under the Act. Those persons specified in clauses (i) and (ii) are referred to herein as the ("ELIGIBLE PURCHASERS"). You will offer the Notes to Eligible Purchasers initially at a price equal to 100% of the principal amount thereof. Such price may be changed at any time without notice. Holders (including subsequent transferees) of the Notes will have the registration rights set forth in the registration rights agreement attached hereto as Exhibit A (the "REGISTRATION RIGHTS AGREEMENT") among the Company and the Initial Purchasers to be dated July 9, 2003, or such other date as agreed to by the Company and the Initial Purchasers. Pursuant to the Registration Rights Agreement, the Company will agree to file with the Securities and Exchange Commission (the "COMMISSION") under the circumstances set forth therein, (i) a registration statement under the Act (the "EXCHANGE OFFER REGISTRATION STATEMENT") relating to the Company's 8 1/4% Senior Notes due 2013 (the "EXCHANGE NOTES") to be offered in exchange for the Notes (such offer to exchange being referred to collectively as the "EXCHANGE OFFER" and (ii) if required by the terms of the Registration Rights Agreement, a shelf registration statement pursuant to Rule 415 under the Securities Act (the "SHELF REGISTRATION STATEMENT" and, together with the Exchange Offer Registration Statement, the "REGISTRATION Statements") relating to the resale by certain holders of the Notes, and to use their best efforts to cause such Registration Statements to be declared effective. This is to confirm the agreements concerning the purchase of the Notes from the Company by the Initial Purchasers. 2. REPRESENTATIONS, WARRANTIES OF THE COMPANY. The Company represents, warrants and covenants to each Initial Purchaser as follows: (a) When the Notes are issued and delivered pursuant to this Agreement, such Notes will not be of the same class (within the meaning of Rule 144A under the Act) as securities of the Company that are listed on a national 3 securities exchange registered under Section 6 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), or that are quoted in a United States automated inter-dealer quotation system. (b) Neither the Company nor any of its Subsidiaries (as defined below) is, or after giving effect to the offering and sale of the Notes and upon application of the proceeds as described under the caption "Use of Proceeds" in the Offering Memorandum will be, an "investment company" or a company "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. (c) Assuming that your representations and warranties in Section 3(b) are true, the purchase of the Notes by you pursuant to this Agreement and the resale of the Notes pursuant to the Exempt Resales is exempt from the registration requirements of the Act. No form of general solicitation or general advertising within the meaning of Regulation D (including, but not limited to, advertisements, articles, notices or other communications published in any newspaper, magazine or similar medium or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising) was used by the Company or any of its representatives (other than you, as to whom the Company makes no representation) in connection with the offer and sale of the Notes. (d) No form of general solicitation or general advertising was used by the Company or any of its representatives (other than you, as to whom the Company makes no representation) with respect to Notes sold outside the United States to non-U.S. persons (as defined in Rule 902 under the Act), by means of any directed selling efforts within the meaning of Rule 902 under the Act, and the Company, any affiliate of the Company and any person acting on its or their behalf (other than you, as to whom the Company makes no representation) has complied with and will implement the "offering restrictions" required by Rule 902. (e) Set forth on Exhibit B hereto is a list of each "employee pension benefit plan," as defined in Section 3(2) of the Employee Retirement Income Security Act of 1974 including the regulations and published interpretations thereunder ("ERISA") or "employee benefit plan," as defined in Section 3(3) of ERISA with respect to which the Company or any corporation considered an affiliate of the Company within the meaning of Section 407(d)(7) of ERISA is a "party in interest," as defined in Section 3(14) of ERISA" or "disqualified person," as defined in Section 4975(e)(2) of the Internal Revenue Code of 1986, as amended. (f) The Preliminary Offering Memorandum and Offering Memorandum have been prepared by the Company for use by the Initial Purchasers in connection with the Exempt Resales. No order or decree preventing the use of the Preliminary Offering Memorandum or the Offering Memorandum, or any order asserting that the transactions contemplated by this Agreement are subject to the registration requirements of the Act has been issued and no proceeding for that purpose has commenced or is pending or, to the knowledge of the Company, is contemplated. (g) The Preliminary Offering Memorandum and the Offering Memorandum, and any amendment or supplement thereto, as of their respective dates and the Offering Memorandum as of the Closing Date (as defined below), did not or will not contain any untrue statement of a material fact or omit to state 4 a material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that this representation and warranty does not apply to statements in or omissions from the Preliminary Offering Memorandum and Offering Memorandum made in reliance upon and in conformity with information relating to the Initial Purchasers furnished to the Company in writing by or on behalf of the Initial Purchasers expressly for use therein. (h) Each subsidiary of the Company that is material to the business, financial condition or results of operations of the Company, taken as a whole (each a "SUBSIDIARY" and collectively, the "SUBSIDIARIES"), is set forth on Exhibit F hereto. The only subsidiaries of the Company are (a) the Subsidiaries set forth on Exhibit F hereto and (b) certain other subsidiaries which, considered in the aggregate as a single subsidiary, are not material to the business, financial condition or results of operations of the Company, taken as a whole. (i) The market-related, industry-related and customer-related data and estimates included in the Preliminary Offering Memorandum and the Offering Memorandum are based on or derived from sources that the Company believes to be reliable and accurate. (j) The Company and each of its Subsidiaries have been duly incorporated, organized or formed, as the case may be, and are validly existing as corporations, limited liability companies, partnerships or limited liability partnerships or other corporate entities, as the case may be, in good standing under the laws of their respective jurisdictions of incorporation, organization or formation, as the case may be, are duly qualified to do business and are in good standing in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification (except such failures to qualify as are not, either individually or in the aggregate, material to the Company and its Subsidiaries taken as a whole), and have all corporate, limited liability company, partnership or limited liability partnership as the case may be, power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged; and none of the Subsidiaries of the Company (other than Wackenhut Corrections Corporation Australia Pty. Ltd., Wackenhut Correctional Services Pty. Ltd. and Australasian Correctional Management, PTY Ltd. (each a "SIGNIFICANT SUBSIDIARY")) is a "significant subsidiary," as such term is defined in Rule 405 of the Rules and Regulations (as defined herein). (k) The Company has an authorized capitalization as set forth in the Offering Memorandum, and all of the issued shares of capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable; and all of the issued shares of capital stock of each Subsidiary of the Company have been duly and validly authorized and issued and are fully paid and non-assessable and (except for directors' qualifying shares) are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims, except with respect to the shares of capital stock of certain Subsidiaries of the Company subject to liens or encumbrances under the Amended Senior Credit Facility as disclosed in the Offering Memorandum. There are no authorized or outstanding options, warrants, preemptive rights, rights of first refusal or other rights to purchase, or equity or debt 5 securities convertible into or exchangeable or exercisable for, any capital stock of the Company or any of its Subsidiaries other than those accurately described in the Offering Memorandum as being authorized or outstanding as of the date stated therein. (l) The Company and its Subsidiaries, as applicable, have all requisite corporate, limited liability company, partnership or limited liability partnership, as the case may be, power and authority to consummate the Transactions and to enter into all agreements related to the Transactions (collectively, the "TRANSACTION DOCUMENTS") to which they are a party. Each of the Transaction Documents has been duly and validly authorized by the Company and its Subsidiaries, as applicable, and when executed and delivered by the Company and its Subsidiaries, as applicable, will (assuming due authorization, execution and delivery by the other parties thereto) constitute a legal, valid and binding agreement of each of the Company and such Subsidiaries, enforceable against the Company and each of such Subsidiaries, as applicable, in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and other laws relating to or affecting creditors' rights generally, from time to time in effect, and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). (m) The Company has all requisite corporate power and authority to enter into the Indenture. The Indenture has been duly and validly authorized by the Company, and upon its execution and delivery and, assuming due authorization, execution and delivery by the Trustee, will constitute the valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors' rights generally, from time to time in effect, and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law); no qualification of the Indenture under the Trust Indenture Act of 1939 (the "1939 ACT") is required in connection with the offer and sale of the Notes contemplated hereby or in connection with the Exempt Resales. (n) The Indenture will conform to the description thereof in the Offering Memorandum. (o) The Notes are in the form contemplated by the Indenture. The Company has all requisite corporate power and authority to issue and sell the Notes. The Notes have been duly and validly authorized by the Company and, when duly executed by the Company in accordance with the terms of the Indenture, assuming due authentication of the Notes by the Trustee, upon delivery to the Initial Purchasers against payment therefor in accordance with the terms hereof, will be validly issued and delivered, and will constitute valid and binding obligations of the Company entitled to the benefits of the Indenture, enforceable against the Company in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors' rights generally, from time to time in effect, and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). 6 (p) The Notes will conform to the description thereof in the Offering Memorandum. (q) The Company has all requisite corporate power and authority to issue the Exchange Notes. The Exchange Notes have been duly and validly authorized by the Company and if and when duly issued and authenticated in accordance with the terms of the Indenture and delivered in accordance with the Exchange Offer provided for in the Registration Rights Agreement, will constitute valid and binding obligations of the Company entitled to the benefits of the Indenture, enforceable against the Company in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors' rights generally, from time to time in effect, and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). (r) The Company has all requisite corporate power and authority to enter into the Registration Rights Agreement. The Registration Rights Agreement has been duly and validly authorized by the Company and, when executed and delivered by the Company in accordance with the terms hereof and thereof, will be validly executed and delivered and (assuming the due authorization, execution and delivery thereof by you) will be the legally valid and binding obligation of the Company in accordance with the terms thereof, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditor's rights generally, from time to time in effect, by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and, as to rights of indemnification and contribution, by principles of public policy. (s) The Registration Rights Agreement will conform to the description thereof in the Offering Memorandum. (t) The Company has all requisite corporate power and authority to enter into this Agreement. This Agreement has been duly authorized, executed and delivered by the Company. (u) The issue and sale of the Notes and the compliance by the Company with all of the provisions of the Notes, the Exchange Notes, the Indenture, the Registration Rights Agreement and this Agreement and the consummation of the Transactions (i) will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or to which any of the property or assets of the Company or any of its Subsidiaries is subject, except for such conflicts, breaches, violations or defaults that, individually or in the aggregate, would not result in any material adverse 7 change in the management, condition, financial or otherwise, stockholders' equity, results of operations, business or prospects of the Company and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"), (ii) will not result in any violation of the provisions of the charter or by-laws of the Company or any of its Subsidiaries or (iii) will not violate any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its Subsidiaries or any of their properties or assets, except such violations that, individually or in the aggregate, would not have a Material Adverse Effect; and no consent, approval, authorization or order of, or filing, registration or qualification with any such court or governmental agency or body is required for the issue and sale of the Notes or the consummation by the Company of the transactions contemplated by this Agreement (including each of the Transactions), the Registration Rights Agreement or the Indenture, except for the filing of a registration statement by the Company with the Commission pursuant to the Act as required by the Registration Rights Agreement, such consents, approvals, authorizations, orders, filings, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Notes by the Initial Purchasers and any filings, qualifications or other consents or approvals under the 1939 Act in connection with the Exchange Notes. (v) There are no contracts, agreements or understandings between the Company and any person granting such person the right (other than rights that have been waived or satisfied) to require the Company to file a registration statement under the Act with respect to any securities of the Company (other than the Registration Rights Agreement) owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant to the Registration Rights Agreement or in any securities being registered pursuant to any other registration statement filed by the Company under the Act. (w) The Company has not, directly or indirectly, solicited any offer to buy or offered to sell, and will not, directly or indirectly, solicit any offer to buy or offer to sell, in the United States or to any United States citizen or resident, any security which is or would be integrated with the sale of the Notes in a manner that would require the Notes to be registered under the Act. None of the Company, its Affiliates (as such term is defined in Rule 501 under the Securities Act (each, an "Affiliate")) or any person acting on its or any of their behalf (other than the Initial Purchasers, as to whom the Company makes no representation or warranty) has engaged or will engage, in connection with the Offering, in any form of general solicitation or general advertising within the meaning of Rule 502 under the Act. (x) Except as otherwise disclosed in the Offering Memorandum, neither the Company nor any of its Subsidiaries has sustained, since the date of the latest audited financial statements included in the Offering Memorandum, any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Offering Memorandum; and, since such date, except as otherwise disclosed in the Offering Memorandum, there has not been any material change in the stockholders' equity or long-term debt of the Company or any of its Subsidiaries or any Material Adverse Effect. (y) The financial statements (including the related notes and supporting schedules) included in the Offering Memorandum present fairly, in all material respects, the financial condition and results of operations of the entities purported to be shown thereby, at the dates and for the periods indicated, and have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods involved, except as may be expressly stated in the related notes thereto and 8 comply as to form, in all material respects, with the applicable requirements of the Act. The financial data set forth in the Offering Memorandum under the captions "Offering Memorandum Summary - Summary Historical and Pro Forma Financial and Other Data" and "Selected Consolidated Financial and Other Data" fairly present, in all material respects, the information set forth therein on a basis consistent with that of the financial statements contained in the Offering Memorandum. (z) The presentation of the other financial data, operating data and statistical information and data included in the Offering Memorandum is a fair presentation of such information and data in all material respects and, to the extent derived therefrom, has been prepared on a basis consistent with the financial statements and the books and records of the Company and its Subsidiaries. (aa) The pro forma financial statements and the related notes thereto included in the Offering Memorandum present fairly, in all material respects, the information shown therein, have been prepared in accordance with the Commission's rules and guidelines with respect to pro forma financial statements and have been properly compiled on the bases described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. (bb) Ernst & Young LLP, who have certified certain financial statements of the Company and certain of its Affiliates, whose report appears in the Offering Memorandum and who have delivered the initial letter referred to in Section 7(e) hereof, are independent public accountants as required by the Act and the rules and regulations promulgated thereunder (the "RULES AND REGULATIONS"); and Arthur Andersen LLP, who have certified certain financial statements of the Company and whose reports appear in the Offering Memorandum, were independent public accountants as required by the Act and the Rules and Regulations during the periods covered by the financial statements on which they reported contained in the Offering Memorandum. (cc) The Company and each of its Subsidiaries has good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them, in each case free and clear of all liens, encumbrances and defects except such as are disclosed in the Offering Memorandum, the liens and encumbrances contemplated under the Amended Senior Credit Facility as disclosed in the Offering Memorandum, and such liens, encumbrances and defects as do not materially affect the value of the property of the Company and its Subsidiaries taken as a whole and do not materially interfere with the use made and proposed to be made of such property by the Company or any of its Subsidiaries; and all real property and buildings held under lease by the Company or any of its Subsidiaries are held by them under valid, subsisting and enforceable leases, with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Company or any of its Subsidiaries. (dd) Except as described in the Offering Memorandum, the Company and each of its subsidiaries carry, or are covered by, insurance in such amounts and covering such risks as is adequate for the conduct of their respective businesses and the value of their respective properties and as is customary for companies engaged in similar businesses in similar industries. The Company has no reason to believe that it or any Subsidiary will not be able (i) 9 to renew its existing insurance coverage as and when such policies expire, except where the failure to renew would not have a Material Adverse Effect or (ii) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse Effect. (ee) Except as described in the Offering Memorandum, there are no legal or governmental proceedings pending to which the Company or any of its Subsidiaries is a party or of which any property or assets of the Company or any of its Subsidiaries is the subject that, if determined adversely to the Company or any of its Subsidiaries, would reasonably be expected to have a Material Adverse Effect, and to the best of the Company's knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others. (ff) Except as otherwise disclosed in the Offering Memorandum, the Company and its Subsidiaries own or possess, license or have other rights to use sufficient trademarks, trade names, patent rights, copyrights, licenses, approvals, trade secrets and other similar rights (collectively, "INTELLECTUAL PROPERTY RIGHTS") reasonably necessary to conduct their businesses as now conducted or as proposed in the Offering Memorandum to be conducted, except where the failure to own, possess, license or have other rights to use such Intellectual Property Rights would not reasonably be expected to have a Material Adverse Effect; and the expected expiration of any of such Intellectual Property Rights would not result in a Material Adverse Effect. Except as otherwise disclosed in the Offering Memorandum, neither the Company nor any of its Subsidiaries has received any notice of infringement or conflict with asserted Intellectual Property Rights of others, which infringement or conflict, if the subject of an unfavorable decision, would result in a Material Adverse Effect. (gg) The Company and each of its Subsidiaries possess such valid and current certificates, authorizations or permits issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to conduct their respective businesses, and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of, or non-compliance with, any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would result in a Material Adverse Effect. (hh) No relationship, direct or indirect, that would be required to be described in a Company registration statement pursuant to Item 404 of Regulation S-K, exists between or among the Company on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company on the other hand, that has not been described in the Offering Memorandum. (ii) No labor disturbance by the employees of the Company or any of its Subsidiaries exists or, to the knowledge of the Company or any of its Subsidiaries, is imminent that would reasonably be expected to have a Material Adverse Effect. (jj) The Company is in compliance in all material respects with all presently applicable provisions of ERISA; no "reportable event" (as defined in ERISA) has occurred with respect to any "pension plan" (as defined in ERISA) for which the Company would have any liability; the Company has not incurred and does not expect to incur liability under (i) Title IV of ERISA with 10 respect to termination of, or withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended, including the regulations and published interpretations thereunder (the "CODE"); and each "pension plan" for which the Company would have any liability that is intended to be qualified under Section 401(a) of the Code is so qualified in all material respects and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification. (kk) The Company has filed all federal, state and local income and franchise tax returns required to be filed through the date hereof and has paid all taxes due thereon, except where such failure to file or pay would not have a Material Adverse Effect, and no tax deficiency has been determined adversely to the Company or any of its Subsidiaries that has had (nor does the Company have any knowledge of any tax deficiency that, if determined adversely to the Company or any of its Subsidiaries, might have) a Material Adverse Effect. (ll) Since the date as of which information is given in the Preliminary Offering Memorandum through the date hereof, and except as may otherwise be disclosed in the Offering Memorandum, subsequent to the respective dates as of which information is given in the Offering Memorandum, neither the Company nor any of its Subsidiaries has (i) issued or granted any securities, other than securities issued upon the exercise of stock options, (ii) incurred any liability or obligation, direct or contingent, other than liabilities and obligations that were incurred in the ordinary course of business and which have not or would not reasonably be expected to result in a Material Adverse Effect, (iii) entered into any transaction not in the ordinary course of business or (iv) declared or paid any dividend on its capital stock (other than to the Company or its Subsidiaries). (mm) The Company (i) makes and keeps accurate books and records and (ii) maintains internal accounting controls that provide reasonable assurance that (A) transactions are executed in accordance with management's authorization, (B) transactions are recorded as necessary to permit preparation of its financial statements and to maintain accountability for its assets, (C) access to its assets is permitted only in accordance with management's authorization and (D) the reported accountability for its assets is compared with existing assets at reasonable intervals. (nn) Neither the Company nor any of its Subsidiaries (i) is in violation of its charter or by-laws, (ii) is in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant, condition or other obligation contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject, except for any defaults which would not, individually or in the aggregate, have a Material Adverse Effect or (iii) is in violation of any law, ordinance, governmental rule, regulation or court decree to which it or its property or assets may be subject or has failed to obtain or maintain any material license, permit, certificate, franchise or other governmental authorization or permit necessary to the ownership of its property or to the conduct of its business, except for any violation or failures to obtain or maintain which would not, individually or in the aggregate, have a Material Adverse Effect. 11 (oo) Neither the Company nor any of its Subsidiaries, nor any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of its Subsidiaries, has used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment. (pp) Except as disclosed in the Offering Memorandum, and except for such matters as would not, individually or in the aggregate, either result in a Material Adverse Effect or require disclosure in the Offering Memorandum, the Company and each of its Subsidiaries (or, to the knowledge of the Company or any of its Subsidiaries, any of their respective predecessors in interest) (1) is conducting and have conducted the business, operations and facilities in compliance with Environmental Laws (as defined below); (2) have duly obtained, possess, maintain in full force and effect, and have fulfilled and performed all of its obligations under any and all permits, licenses or registrations required under Environmental Law ("ENVIRONMENTAL PERMITS"); (3) is not party to, or otherwise bound by, any contract under which it is obligated by any representation, warranty, indemnification, covenant, restriction or other undertaking concerning any material liability under Environmental Law or related to the remediation of any Hazardous Substances (as defined below); (4) have not received any notice from a governmental authority or any other third party alleging any violation of Environmental Law or liability thereunder (including, without limitation, liability as a "potentially responsible party" and/or for costs of investigating or remediating sites containing Hazardous Substances and/or damages to natural resources); (5) is not subject to any pending or, to the best knowledge of the Company or any of its Subsidiaries, threatened claim or other legal proceeding under any Environmental Laws; and (6) does not have any knowledge of any pending Environmental Law, or any unsatisfied condition in an Environmental Permit, or any release of Hazardous Substances that, individually or in the aggregate, can reasonably be expected to form the basis of any such claim or legal proceeding against the Company or any of its Subsidiaries or to require any material capital expenditures to maintain the Company's or any of its Subsidiaries' compliance with Environmental Law or with their Environmental Permits. As used in this paragraph, "ENVIRONMENTAL LAWS" means any and all applicable federal, state, local, and foreign laws, statutes, ordinances, rules, regulations, requirements and common law, or any enforceable administrative or judicial interpretation, order, consent, decree or judgment thereof, relating to pollution or the protection of human health or the environment, including, without limitation, those relating to, regulating, or imposing liability or standards of conduct concerning (i) noise or odor, (ii) emissions, discharges, releases or threatened releases of Hazardous Substances into ambient air, surface water, groundwater or land, (iii) the generation, manufacture, processing, distribution, use, treatment, storage, disposal, release, transport or handling of, or exposure to, Hazardous Substances, (iv) the protection of wildlife or endangered or threatened species, or (v) the investigation, remediation or cleanup of any Hazardous Substances. As used in this paragraph, "HAZARDOUS SUBSTANCES" means pollutants, contaminants or hazardous, dangerous, toxic, biohazardous or infectious substances, materials, constituents or wastes or toxins, petroleum, petroleum products and their breakdown constituents, or any other chemical substance regulated under Environmental Laws or exhibiting a hazardous waste characteristic including but not limited to corrosivity, ignitability, toxicity, or reactivity, whether solid, gaseous or liquid in nature. 12 (qq) None of the transactions contemplated by this Agreement (including, without limitation, the use of the proceeds from the sale of the Notes), will violate or result in a violation of Section 7 of the Exchange Act, or any regulation promulgated thereunder, including, without limitation, Regulations T, U and X of the Board of Governors of the Federal Reserve System. (rr) Prior to the date hereof, neither the Company nor any of its Affiliates nor any person acting on its or their behalf (other than you, as to whom the Company makes no representation) has taken any action that is designed to or that has constituted or that might have been expected to cause or result in stabilization or manipulation of the price of any security of the Company in connection with the Offering. (ss) The minute books and records of the Company and its Subsidiaries relating to proceedings of their respective shareholders, boards of directors, and committees of their respective boards of directors made available to Shearman & Sterling, counsel for the Initial Purchasers, are their original minute books and records or are true, correct and complete copies thereof, with respect to all proceedings of said shareholders, boards of directors and committees since three years prior to the date of the document request letter dated May 5, 2003 delivered to the Company by Shearman & Sterling through the date hereof. In the event that definitive minutes have not been prepared with respect to any proceedings of such shareholders, boards of directors or committees, the Company has provided Shearman & Sterling with originals or true, correct and complete copies of draft minutes or written agendas relating thereto, which drafts and agendas, if any, reflect all events that occurred in connection with such proceedings. (tt) The Company has established and maintains disclosure controls and procedures (as such term is defined in Rule 13a-14 under the Exchange Act), which (i) are designed to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to the Company's principal executive officer and its principal financial officer by others within those entities, particularly during the periods in which the periodic reports required under the Exchange Act are being prepared; (ii) have been evaluated for effectiveness as of a date within 90 days prior to the date of the Company's most recent annual or quarterly report; and (iii) are effective in all material respects to perform the functions for which they were established. (uu) Based on the evaluation of its disclosure controls and procedures, the Company is not aware of (i) any significant deficiency in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data either with respect to itself or any of its consolidated subsidiaries or any material weaknesses in internal controls; or (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls. (vv) Since the date of the most recent evaluation of such disclosure controls and procedures, there have been no significant changes in internal controls or in other factors that could significantly affect internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses. 13 (ww) The Company is, and immediately after the Closing Date will be, Solvent. As used herein, the term "Solvent" means, with respect to the Company on a particular date, that on such date (i) the Company would be able to pay its debts as they become due in the usual course of business, and (ii) the Company's total assets would be greater than the sum of its total liabilities plus the amount that would be needed, if the Company were to be dissolved upon the consummation of the Transactions, to satisfy the preferential rights upon dissolution of shareholders of the Company whose preferential rights are superior of those receiving the distribution in the Transactions. (xx) The Common Stock of the Company is registered pursuant to Section 12(b) of the Exchange Act and is listed on the New York Stock Exchange (the "NYSE"), and the Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock from the NYSE, nor has the Company received any notification that the Commission or the NYSE is contemplating terminating such registration or listing. (yy) The Company is subject to and, except for the failure to file separate audited financial statements for its affiliate, Premier Custodial Group, for each of the fiscal years ended December 30, 2001 and December 31, 2000, (i) is in full compliance with the reporting requirements of Section 13 or 15(d) of the Exchange Act and (ii) each report filed by the Company with the Commission pursuant to Section 13 or 15(d) of the Exchange Act complied as to form in all material respects at the time of its filing with or will comply as to form in all material respects at the time of the filing thereof with the Exchange Act and the rules and regulations of the Commission thereunder. (zz) Except as disclosed in the Offering Memorandum, no subsidiary of the Company is currently prohibited, directly or indirectly, from paying any dividends to the Company, from making any other distribution on such subsidiary's capital stock, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such subsidiary's property or assets to the Company or any other subsidiary of the Company. 3. PURCHASE OF THE NOTES BY THE INITIAL PURCHASERS, AGREEMENTS TO SELL, PURCHASE AND RESELL. (a) The Company hereby agrees, on the basis of the representations, warranties and agreements of the Initial Purchasers contained herein and subject to all the terms and conditions set forth herein, to issue and sell to the Initial Purchasers and, upon the basis of the representations, warranties and agreements of the Company herein contained and subject to all the terms and conditions set forth herein, each Initial Purchaser agrees, severally and not jointly, to purchase from the Company, at a purchase price of 97 % of the principal amount thereof, the total principal amount of Notes set forth opposite the name of such Initial Purchaser in Schedule I hereto. The Company shall not be obligated to deliver any of the securities to be delivered hereunder except upon payment for all of the securities to be purchased as provided herein. (b) Each of the Initial Purchasers, severally and not jointly, hereby represents and warrants to the Company that (i) it will offer the Notes for sale upon the terms and conditions set forth in this Agreement and in the Offering Memorandum (ii) it has all requisite corporation power and authority to enter into this Agreement and (iii) it has duly authorized, executed and delivered this Agreement. Each of the Initial Purchasers hereby represents and warrants to, and agrees with, the Company that such Initial Purchaser: (i) is a QIB with such knowledge and experience in financial and business matters as are 14 necessary in order to evaluate the merits and risks of an investment in the Notes; (ii) is purchasing the Notes pursuant to a private sale exempt from registration under the Act; (iii) in connection with the Exempt Resales, will solicit offers to buy the Notes only from, and will offer to sell the Notes only to, the Eligible Purchasers in accordance with this Agreement and on the terms contemplated by the Offering Memorandum; and (iv) will not offer or sell the Notes, nor has it offered or sold the Notes by, or otherwise engaged in, any form of general solicitation or general advertising (within the meaning of Regulation D, including, but not limited to, advertisements, articles, notices or other communications published in any newspaper, magazine, or similar medium or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising) and will not engage in any directed selling efforts within the meaning of Rule 902 under the Act, in connection with the offering of the Notes. The Initial Purchasers have advised the Company that they will offer the Notes to Eligible Purchasers at a price initially equal to 100% of the principal amount thereof, plus accrued interest, if any, from the date of issuance of the Notes. Such price may be changed by the Initial Purchasers at any time without notice. Each of the Initial Purchasers understands that the Company and, for purposes of the opinions to be delivered to the Initial Purchasers pursuant to Sections 7(c) and 7(d) hereof, counsel to the Company and counsel to the Initial Purchasers, will rely upon the accuracy and truth of the foregoing representations, warranties and agreements and the Initial Purchasers hereby consent to such reliance. (c) Notwithstanding any of the foregoing, the Company shall not be obligated to deliver any of the securities to be delivered hereunder unless each of the Transactions shall have been consummated in accordance with the terms of the Transaction Documents as in effect on the date of the Offering Memorandum. Other than as set forth in Section 5(s) and in Sections 6, 8, 11 and 14 hereof, in the event the Company exercises its rights under this Section 3(c), the Company shall have no further obligations to the Initial Purchasers, including the obligation to deliver the securities in accordance with the terms of Section 3(a) hereof. 4. DELIVERY OF THE NOTES AND PAYMENT THEREFOR. Delivery to the Initial Purchasers of and payment for the Notes shall be made at the office of the Company, 621 NW 53rd Street, Suite 700, Boca Raton, Florida 33487 (or such other place as my be agreed by the Company and the Initial Purchasers), at 9:00 A.M., New York City time on July 9, 2003, or such other time and date as the Initial Purchasers shall designate by notice to the Company (the "CLOSING DATE"). The Notes will be delivered to the Initial Purchasers, or the Trustee as custodian for The Depository Trust Company ("DTC"), against payment by or on behalf of the Initial Purchasers of the purchase price therefor by wire transfer in immediately available funds, by causing DTC to credit the Notes to the account of the Initial Purchasers at DTC. The Notes will be evidenced by one or more global securities in definitive form (the "GLOBAL NOTES") registered in the name of Cede & Co. as nominee of DTC. The Global Notes in definitive form shall be made available to the Initial Purchasers in New York City for inspection and packaging not later than 9:30 A.M., New York City time, on the business day next preceding the Closing Date. 15 5. AGREEMENTS OF THE COMPANY. The Company agrees with each of the Initial Purchasers as follows: (a) The Company will furnish to the Initial Purchasers, without charge, as of the date of the Offering Memorandum, such number of copies of the Offering Memorandum as may then be amended or supplemented as they may reasonably request. (b) The Company will not make any amendment or supplement to the Preliminary Offering Memorandum or to the Offering Memorandum of which the Initial Purchasers shall not previously have been advised or to which they shall have reasonably objected within five business days after being furnished with a copy of such proposed amendment or supplement. (c) The Company consents to the use, in accordance with the securities or Blue Sky laws of the jurisdictions in which the Notes are offered by the Initial Purchasers and by dealers, prior to the date of the Offering Memorandum, of each Preliminary Offering Memorandum so furnished by the Company. The Company consents to the use of the Offering Memorandum in accordance with the securities or Blue Sky laws of the jurisdictions in which the Notes are offered by the Initial Purchasers and by all dealers to whom Notes may be sold, in connection with the offering and sale of the Notes. (d) If, at any time prior to completion of the distribution of the Notes by the Initial Purchasers to Eligible Purchasers, any event occurs or information becomes known that, in the judgment of the Company or in the opinion of counsel for the Initial Purchasers, should be set forth in the Offering Memorandum so that the Offering Memorandum does not include any untrue statement of material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary to supplement or amend the Offering Memorandum in order to comply with any law, the Company will forthwith prepare an appropriate supplement or amendment thereto, and will expeditiously furnish at its own expense to the Initial Purchasers and dealers a reasonable number of copies thereof. (e) The Company will cooperate with the Initial Purchasers and with their counsel in connection with the qualification or registration of the Notes for offering and sale by the Initial Purchasers and by dealers under (or obtain exemptions from the application of) the securities or Blue Sky laws of such jurisdictions as the Initial Purchasers may designate and will file such consents to service of process or other documents necessary or appropriate in order to effect such qualifications, registrations and exemptions; PROVIDED that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the Notes, in any jurisdiction where it is not now so subject. The Company will advise the Initial Purchasers promptly of the suspension or qualification or registration of (or any such exemption relating to) the Notes for offering, sale or trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose, and in the event of the issuance of any order suspending such qualification, registration or exemption, the Company shall use its best efforts to obtain the withdrawal thereof at the earliest possible moment. 16 (f) For a period of 180 days from the date of the Offering Memorandum, the Company agrees not to, directly or indirectly, sell, offer to sell, contract to sell, grant any option to purchase, issue any instrument convertible into or exchangeable for, or otherwise transfer or dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition in the future of), any debt securities of the Company or any of its Subsidiaries similar to the Notes (which debt securities shall not include borrowings in connection with a customary commercial credit facility), except (i) in exchange for the Exchange Notes in connection with the Exchange Offer or (ii) with the prior consent of the Initial Purchasers. (g) For so long as any Notes or Exchange Notes remain outstanding, the Company will furnish to any Initial Purchaser upon request (i) as soon as practicable after the filing thereof, copies of the Annual Report on Form 10-K of the Company containing the balance sheet of the Company as of the close of such fiscal year and statements of income, stockholders' equity and cash flows for the year then ended and the opinion thereon of the Company's independent public or certified public accountants; (ii) as soon as practicable after the filing thereof, copies of each proxy statement, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other report filed by the Company with the Commission, the NYSE or any securities exchange or inter-dealer quotation system; (iii) as soon as available, copies of any report or communication of the Company mailed generally to holders of its capital stock or debt securities (including the holders of the Notes); and (iv) from time to time such other information concerning the Company as the Initial Purchasers may reasonably request. (h) The Company will apply the net proceeds from the sale of the Notes to be sold by it hereunder substantially in accordance with the description set forth in the Offering Memorandum under the caption "Use of Proceeds." (i) Except as stated in this Agreement and in the Preliminary Offering Memorandum and Offering Memorandum, neither the Company nor any of its Affiliates has taken, nor will any of them take, directly or indirectly, any action designed to or that might reasonably be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Notes. Except as permitted by the Act, the Company will not distribute any offering material in connection with the Exempt Resales. (j) The Company will use their best efforts to permit the Notes to be designated Private Offerings, Resales and Trading through Automated Linkages (PORTAL) MarketSM (the "PORTAL MARKETSM") securities in accordance with the rules and regulations adopted by the National Association of Securities Dealers, Inc. relating to trading in the PORTAL MarketSM and to permit the Notes to be eligible for clearance and settlement through DTC. (k) During the period of two years after the Closing Date, the Company will not, and will not permit any of its Affiliates, to, resell any of the Notes that constitute "restricted securities" under Rule 144 that have been reacquired by any of them. 17 (l) The Company agrees that it will not and will cause its Affiliates not to make any offer or sale of securities of the Company of any class if, as a result of the doctrine of "integration" referred to in Rule 502 under the Act, such offer or sale would render invalid (for the purpose of the sale of the Notes by the Company to the Initial Purchasers, (i) the resale of the Notes by the Initial Purchasers to Eligible Purchasers or (ii) the resale of the Notes by such Eligible Purchasers to others) the exemption from the registration requirements of the Act provided by Section 4(2) thereof or by Rule 144A or by Regulation S thereunder or otherwise. (m) The Company agrees to comply with all the terms and conditions of the Registration Rights Agreement and all agreements set forth in the representation letter of the Company to DTC relating to the approval of the Notes by DTC for "book entry" transfer. (n) The Company will take such steps as shall be necessary to ensure that neither the Company nor any of the Company's Subsidiaries becomes an "investment company" within the meaning of such term under the Investment Company Act of 1940, as amended. (o) Each certificate for a Note will bear the legend contained in "Notice to Investors" in the Offering Memorandum for the time period and upon the other terms stated in the Offering Memorandum. (p) Prior to the completion of the placement of the Notes by the Initial Purchasers with the Eligible Purchasers, the Company shall file, on a timely basis, with the Commission and the NYSE all reports and documents required to be filed under Section 13 or 15 of the Exchange Act. Additionally, at any time when the Company is not subject to Section 13 or 15 of the Exchange Act and so long as any of the Notes qualify as "restricted securities" within the meaning of Rule 144(a)(3) of the Act, for the benefit of holders and beneficial owners from time to time of Notes, the Company shall furnish, at its expense, upon request, to holders and beneficial owners of Notes and prospective purchasers of Notes information ("ADDITIONAL ISSUER INFORMATION") satisfying the requirements of Rule 144A(d)(4). (q) The Company shall comply with the terms of the Indenture and the Offering Memorandum and shall promptly notify the Initial Purchasers if the Company discovers that any of its representations contained in this Agreement is not, at any time prior to the completion of the distribution of the Notes, true and correct, or if the Company has at any such time breached any of its obligations hereunder. (r) The Company will do and perform all things required or necessary to be done and performed under this Agreement by it prior to the Closing Date, and to satisfy all conditions precedent to the Initial Purchasers' obligations hereunder to purchase the Notes. (s) The Company shall use its best efforts to cause (i) each of the Transactions to be consummated in accordance with the terms of the Transaction Documents as described in the Offering Memorandum and (ii) each of the conditions to the consummation of the Transactions set forth in each of the Transaction Documents to be satisfied. 6. EXPENSES. Whether or not the transactions contemplated by this Agreement are consummated or this Agreement becomes effective or is terminated, the Company agrees, to pay all costs, expenses, fees and taxes incident to and in connection with: (i) the preparation, printing, filing and distribution of 18 the Preliminary Offering Memorandum and the Offering Memorandum (including, without limitation, financial statements and exhibits) and all amendments and supplements thereto (including the fees, disbursements and expenses of the Company's accountants and counsel); (ii) the reasonable fees and disbursement of Shearman & Sterling, counsel to the Initial Purchasers, incurred in connection with the Offering; (iii) the preparation, printing (including, without limitation, word processing and duplication costs) and delivery of this Agreement, the Indenture, the Registration Rights Agreement, all Blue Sky Memoranda and all other agreements, memoranda, correspondence and other documents printed and delivered in connection therewith and with the Exempt Resales; (iv) the issuance and delivery by the Company of the Notes and any taxes payable in connection therewith; (v) all necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Notes to the Initial Purchasers; (vi) the qualification of the Notes and Exchange Notes for offer and sale under the securities or Blue Sky laws of the several states (including, without limitation, the reasonable fees and disbursements of your counsel relating to such registration or qualification); (vii) all fees and expenses of the Trustee, including the fees and disbursements of counsel for the Trustee in connection with the Indenture, the Notes and the Exchange Notes; (viii) the furnishing of such copies of the Preliminary Offering Memorandum and the Offering Memorandum, and all amendments and supplements thereto, as may be reasonably requested for use in connection with the Exempt Resales; (ix) the preparation of certificates for the Notes (including, without limitation, printing and engraving thereof); (x) the application for quotation of the Notes in the PORTAL MarketSM (including all disbursements and listing fees); (xi) the approval of the Notes by DTC for "book-entry" transfer (including fees and expenses of counsel); (xii) the rating of the Notes and the Exchange Notes; (xiii) the performance by the Company of its other obligations under this Agreement; and (xiv) all travel expenses (including expenses related to chartered aircraft) of each Initial Purchaser and the Company's officers and employees and any other expenses of each Initial Purchaser and the Company in connection with attending or hosting meetings with prospective purchasers of the Notes. 7. CONDITIONS TO INITIAL PURCHASERS' OBLIGATIONS. The respective obligations of the Initial Purchasers hereunder are subject to the accuracy, when made and on and as of the Closing Date, of the representations and warranties of the Company contained herein, to the performance by the Company of its obligations hereunder, and to each of the following additional terms and conditions: (a) The Initial Purchasers shall not have discovered and disclosed to the Company on or prior to the Closing Date that the Offering Memorandum or any amendment or supplement thereto contains an untrue statement of a fact that, in the opinion of Shearman & Sterling, counsel to the Initial Purchasers, is material or omits to state a fact that, in the opinion of such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading. (b) All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Notes, the Exchange Notes, the Registration Rights Agreement, the Indenture and the Offering Memorandum, and all other legal matters relating to this Agreement and the Transactions shall be reasonably satisfactory in all material respects to Shearman & Sterling, counsel for the Initial Purchasers, and the Company shall 19 have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters. (c) Akerman Senterfitt shall have furnished to the Initial Purchasers its written opinion (containing customary assumptions, qualifications, limitations and exceptions acceptable to the Initial Purchasers), as counsel to the Company, addressed to the Initial Purchasers and dated the Closing Date, as set forth in Exhibit C hereto. (d) Each of Stephenson Harwood, Edward, Nathan & Friedland and Baker & McKenzie, respectively, shall have furnished to the Initial Purchasers its written opinion (containing customary assumptions, qualifications, limitations and exceptions acceptable to the Initial Purchasers, as counsel to Wackenhut Corrections (UK) Limited, Wackenhut Corrections Corporation South Africa (Pty) Limited and Wackenhut Corrections Corporation Australia Pty. Ltd., respectively, addressed to the Initial Purchasers and dated the Closing Date, in the form of Exhibit D hereto or in substance satisfactory to the Initial Purchasers. (e) The Initial Purchasers shall have received from Shearman & Sterling, counsel for the Initial Purchasers, such opinion or opinions, dated the Closing Date, with respect to the issuance and sale of the Notes, the Offering Memorandum and other related matters as the Initial Purchasers may reasonably require, and the Company shall have furnished to such counsel such documents and information as they reasonably request for the purpose of enabling them to pass upon such matters. (f) At the time of execution of this Agreement, the Initial Purchasers shall have received from Ernst & Young LLP a letter, in form and substance satisfactory to the Initial Purchasers, addressed to the Initial Purchasers and dated the date hereof (i) confirming that they are independent public accountants within the meaning of the Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission and (ii) stating, as of the date hereof (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Offering Memorandum, as of a date not more than five days prior to the date hereof), the conclusions and findings of such firm with respect to the financial information and (iii) covering such other matters as are ordinarily covered by accountants' "comfort letters" to underwriters in connection with registered public offerings. (g) With respect to the letter of Ernst & Young LLP referred to in the preceding paragraph and delivered to the Initial Purchasers concurrently with the execution of this Agreement (the "INITIAL LETTER"), the Company shall have furnished to the Initial Purchasers a letter (the "BRING-DOWN LETTER") of such accountants, addressed to the Initial Purchasers and dated the Closing Date (i) confirming that they are independent public accountants within the meaning of the Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the Closing Date (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Offering Memorandum, as of a date not more than three days prior to the date of the Closing Date), the conclusions and findings of such firm with respect to the financial information and other matters covered by the initial letter and (iii) confirming in all material respects the conclusions and findings set forth in the initial letter. 20 (h) Neither the Company nor any of its Subsidiaries shall have sustained, since the date of the latest audited financial statements included in the Offering Memorandum, any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Offering Memorandum; and, since such date, except as otherwise disclosed in the Offering Memorandum, there shall not have been any material change in the stockholders' equity or long-term debt of the Company or any of its Subsidiaries or a Material Adverse Effect affecting the management, condition, financial or otherwise, stockholders' equity, results of operations, business or prospects of the Company and its subsidiaries, taken as a whole. (i) On the Closing Date, the Initial Purchasers shall have received a written certificate executed by the Chief Financial Officer of the Company, dated as of the Closing Date, to the effect that: (i) the representations, warranties and covenants of the Company set forth in Section 2 of this Agreement are true and correct with the same force and effect as though expressly made on and as of the Closing Date; (ii) the Company has complied with all the agreements and satisfied all the conditions on their part to be performed or satisfied at or prior to the Closing Date; (iii) for the period from and after the date of this Agreement and prior to the Closing Date there has not occurred any Material Adverse Effect; and (iv) to such officer's actual knowledge the issuance and sale of the Notes by the Company has not been enjoined by any court or governmental body or agency. (j) Subsequent to the execution and delivery of this Agreement (i) no downgrading shall have occurred in the rating accorded the Company's debt securities by any "nationally recognized statistical rating organization," as that term is defined by the Commission for purposes of Rule 436(g)(2) of the Rules and Regulations and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company's debt securities. (k) At the Closing Date, the Notes shall have been designated for trading on the PORTAL MarketSM and shall be eligible for clearance and settlement through DTC. (l) The Company shall have executed and delivered the Registration Rights Agreement, and the Initial Purchasers shall have received an original copy thereof, duly executed by the Company. (m) The Company and the Trustee shall have executed and delivered the Indenture and the Initial Purchasers shall have received an original copy thereof, duly executed by the Company and the Trustee. 21 (n) At the Closing Date, each of the Transactions shall have been consummated in accordance with the terms of the Transaction Documents as in effect on the date of the Offering Memorandum. (o) Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the following: (i) trading or quotation in securities generally on the New York Stock Exchange, the Nasdaq National Market System or the American Stock Exchange or in the over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market, has been suspended or minimum prices shall have been established on any such exchange or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction; (ii) a material disruption in securities settlement, payment or clearance services in the United States; (iii) a banking moratorium has been declared by Federal or state authorities; (iv) any attack on, outbreak or escalation of hostilities or act of terrorism involving the United States, any declaration of war by Congress or any other national or international calamity, crisis or emergency if, in the judgment of the Initial Purchasers, the effect of any such attack, outbreak, escalation, act, declaration, calamity, crisis or emergency makes it impractical or inadvisable to proceed with completion of the Offering or sale of and payment for the Notes; (v) the occurrence of any other calamity, crisis (including without limitation as a result of terrorist activities), or material adverse change in general economic, political or financial conditions (or the effect of international conditions on the financial markets in the United States shall be such) as to make it, in the judgment of the Initial Purchasers, impracticable or inadvisable to proceed with the Offering or the delivery of the Notes being delivered on the Closing Date or that, in the judgment of the Initial Purchasers, would materially and adversely affect the financial markets or the markets for the Notes and other debt securities. (p) On or before the Closing Date, the Initial Purchasers and counsel for the Initial Purchasers shall have received such information, documents and opinions as they may reasonably require for the purposes of enabling them to pass upon the issuance and sale of the Notes as contemplated herein, or in order to evidence the accuracy of any of the representations and warranties, or the satisfaction of any of the conditions or agreements, herein contained. (q) Each of the conditions to the closing of the Share Repurchase as set forth in the agreements governing the Share Repurchase (without giving effect to any amendment, waiver or supplement thereto) as of the date hereof shall have been satisfied. (r) John J. Bulfin, Esq., General Counsel of the Company shall have furnished to the Initial Purchasers his written opinion (containing customary assumptions, qualifications, limitations and exceptions acceptable to the Initial Purchasers) addressed to the Initial Purchasers and dated the Closing Date in the form of Exhibit E hereto. All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers. 22 8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company hereby agrees to indemnify and hold harmless each Initial Purchaser, its directors, officers and employees and each person, if any, who controls any Initial Purchaser within the meaning of the Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of Notes and relating to the Company's exercise of its rights pursuant to Section 3(c) hereof), to which that Initial Purchaser, director, officer, employee or controlling person may become subject, under the Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained (A) in any Preliminary Offering Memorandum or the Offering Memorandum or in any amendment or supplement thereto or (B) in any Blue Sky application or other document prepared or executed by the Company (or based upon any written information furnished by the Company) specifically for the purpose of qualifying any or all of the Notes under the securities laws of any state or other jurisdiction (any such application, document or information being hereinafter called a "BLUE SKY APPLICATION"), (ii) the omission or alleged omission to state in any Preliminary Offering Memorandum or the Offering Memorandum, or in any amendment or supplement thereto, or in any Blue Sky Application, any 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 or (iii) any act or failure to act or any alleged act or failure to act by any Initial Purchaser in connection with, or relating in any manner to, the Notes or the Offering, and that is included as part of or referred to in any loss, claim, damage, liability or action arising out of or based upon matters covered by clause (i) or (ii) above (PROVIDED that the Company shall not be liable under this clause (iii) to the extent that it is determined in a final judgment by a court of competent jurisdiction that such loss, claim, damage, liability or action resulted directly from any such acts or failures to act undertaken or omitted to be taken by such Initial Purchaser through its gross negligence or willful misconduct), and shall reimburse each Initial Purchaser and each such director, officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by that Initial Purchaser, director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred; PROVIDED, HOWEVER, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Offering Memorandum or Offering Memorandum, or in any such amendment or supplement thereto, in reliance upon and in conformity with written information concerning such Initial Purchaser furnished to the Company through the Initial Purchasers by or on behalf of any Initial Purchaser specifically for inclusion therein. The foregoing indemnity agreement is in addition to any liability that the Company may otherwise have to any Initial Purchaser or to any director, officer, employee or controlling person of that Initial Purchaser. (b) Each Initial Purchaser, severally and not jointly, hereby agrees to indemnify and hold harmless the Company, its officers and employees, each of its directors, and each person, if any, who controls the Company within the meaning of the Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof, to which the Company or any such director, officer, employee or controlling person may become subject, under the Act or otherwise, insofar as such loss, claim, damage, liability or action 23 arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained (A) in any Preliminary Offering Memorandum or the Offering Memorandum or in any amendment or supplement thereto, or (ii) the omission or alleged omission to state in any Preliminary Offering Memorandum or the Offering Memorandum, or in any amendment or supplement thereto, any material fact required to be stated therein or necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information concerning such Initial Purchaser furnished to the Company by or on behalf of that Initial Purchaser specifically for inclusion therein, and shall reimburse the Company and any such director, officer, employee or controlling person for any legal or other expenses reasonably incurred by the Company or any such director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred. The foregoing indemnity agreement is in addition to any liability that any Initial Purchaser may otherwise have to the Company or any such director, officer, employee or controlling person. (c) Promptly after receipt by an indemnified party under this Section 8 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that the failure to notify the indemnifying party shall not relieve it from any liability that it may have under this Section 8 except to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses 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 this Section 8. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section 8 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that the Initial Purchasers shall have the right to employ counsel to represent jointly the Initial Purchasers and those Initial Purchasers and their respective directors, officers, employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the Initial Purchasers against the Company under this Section 8 if, in the reasonable judgment of the Initial Purchasers, it is advisable for the Initial Purchasers and those directors, officers, employees and controlling persons to be jointly represented by separate counsel, and in that event the fees and expenses of such separate counsel shall be paid by the Company. No indemnifying party shall (i) without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any 24 pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding, or (ii) be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment. (d) If the indemnification provided for in this Section 8 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and the Initial Purchasers on the other from the offering of the Notes or (ii) if the allocation provided by clause (i) above 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 Company, on the one hand, and the Initial Purchasers on the other with respect to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Initial Purchasers on the other with respect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Notes purchased under this Agreement (before deducting expenses) received by the Company on the one hand, and the total initial purchasers' discounts and commissions received by the Initial Purchasers with respect to the Notes purchased under this Agreement, on the other hand, bear to the total gross proceeds from the offering of the Notes under this Agreement as set forth on the cover page of the Offering Memorandum. The relative fault shall be determined by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Initial Purchasers, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Initial Purchasers agree that it would not be just and equitable if contributions pursuant to this Section 8(d) were to be determined by pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section 8(d) shall be deemed to include, for purposes of this Section 8(d), any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8(d), no Initial Purchaser shall be required to contribute any amount in excess of the amount by which the total price at which the Notes initially purchased by it were offered to the Eligible Purchasers exceeds the total price at which such Initial Purchaser purchased the Notes from the Company. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Initial Purchasers' obligations to contribute as provided in this Section 8(d) are several in proportion to their respective underwriting obligations and not joint. 25 (e) The Initial Purchasers severally confirm and the Company acknowledges that (i) the names of the Initial Purchasers at set forth on the cover page of the Offering Memorandum and (ii) the statements with respect to the offering of the Notes by the Initial Purchasers set forth in the first sentence of the third paragraph of the section entitled "Plan of Distribution" in the Offering Memorandum are correct and constitute the only information concerning such Initial Purchasers furnished in writing to the Company by or on behalf of the Initial Purchasers specifically for inclusion in the Offering Memorandum. 9. DEFAULTING INITIAL PURCHASERS. If, on the Closing Date, any Initial Purchaser defaults in the performance of its obligations under this Agreement, the remaining non-defaulting Initial Purchasers shall be obligated to purchase the Notes that the defaulting Initial Purchaser agreed but failed to purchase on the Closing Date in the respective proportions that the number of Notes set opposite the name of each remaining non-defaulting Initial Purchaser in Schedule I hereto bears to the total number of Notes set opposite the names of all the remaining non-defaulting Initial Purchasers in Schedule I hereto; PROVIDED, HOWEVER, that the remaining non-defaulting Initial Purchasers shall not be obligated to purchase any of the Notes on the Closing Date if the total number of Notes that the defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase on such date exceeds 9.09% of the total number of Notes to be purchased on the Closing Date, and any remaining non-defaulting Initial Purchasers shall not be obligated to purchase more than 110% of the number of Notes that it agreed to purchase on the Closing Date pursuant to the terms of Section 3. If the foregoing maximums are exceeded, the remaining non-defaulting Initial Purchasers, or those other Initial Purchasers satisfactory to the Initial Purchasers who so agree, shall have the right, but shall not be obligated, to purchase, in such proportion as may be agreed upon among them, all the Notes to be purchased on the Closing Date. If the remaining Initial Purchasers or other Initial Purchasers satisfactory to the Initial Purchasers do not elect to purchase the Notes that the defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase on the Closing Date, this Agreement shall terminate without liability on the part of any non-defaulting Initial Purchaser or the Company, except that the Company will continue to be liable for the payment of expenses to the extent set forth in Sections 6 and 11. Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it may have to the Company for damages caused by its default. If other Initial Purchasers are obligated or agree to purchase the Notes of a defaulting or withdrawing Initial Purchaser, either the remaining Initial Purchasers or the Company may postpone the Closing Date for up to seven full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Initial Purchasers may be necessary in the Offering Memorandum or in any other document or arrangement. 10. TERMINATION. The obligations of the Initial Purchasers hereunder may be terminated by the Initial Purchasers by notice given to and received by the Company prior to delivery of and payment for the Notes if, prior to that time, any of the events described in Sections 7(h) or 7(o) shall have occurred or if the Initial Purchasers shall decline to purchase the Notes for any reason permitted under this Agreement. 11. REIMBURSEMENT OF INITIAL PURCHASERS' EXPENSES. If the Company fails to tender the Notes for delivery to the Initial Purchasers by reason of any failure, refusal or inability on the part of the Company to perform any 26 agreement on its part to be performed, or because any other condition of the obligations hereunder required to be fulfilled by the Company is not fulfilled, the Company shall reimburse the Initial Purchasers for all reasonable out-of-pocket expenses incurred by the Initial Purchasers in connection with this Agreement and the proposed purchase and offerings and sale of the Notes, including but not limited to fees and disbursements of counsel, printing expenses, travel expenses, postage, facsimile and telephone charges, and upon demand the Company shall pay the full amount thereof to the Initial Purchasers. If this Agreement is terminated pursuant to Section 9 by reason of the default of one or more Initial Purchasers, the Company shall not be obligated to reimburse any defaulting Initial Purchaser on account of those expenses. 12. NOTICES, ETC. All communications hereunder shall be in writing and shall be mailed, hand delivered or telecopied and confirmed to the parties hereto as follows: If to the Initial Purchasers: BNP Paribas Securities Corp. The Equitable Tower 787 Seventh Avenue New York, NY 10019 Facsimile: (212) 841-3561 Attention: Douglas Cook, Esq. Lehman Brothers Inc. 745 Seventh Avenue New York, NY 10019 Facsimile: 212-526-0943 Attention: Syndicate and Lehman Brothers Inc. Litigation Department 399 Park Avenue New York, NY 10022 with a copy to: Shearman & Sterling LLP 599 Lexington Avenue New York, NY 10022 Facsimile: (212) 848-7179 Attention: Andrew R. Schleider, Esq. 27 If to the Company: Wackenhut Corrections Corporation One Park Place 621 NW 53rd Street Boca Raton, Florida 33487 Facsimile: (561) 999-7744 Attention: John J. Bulfin, Esq. with a copy to: Akerman Senterfitt One Southeast Third Avenue 28th Floor Miami, Florida 33131-1714 Facsimile: (305) 374-5095 Attention: Stephen K. Roddenberry Any such statements, requests, notices or agreements shall take effect at the time delivered by hand, if personally delivered; two business days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt is acknowledged, if telecopied; and on the next business day, if timely delivered to an air courier guaranteeing overnight delivery. 13. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure to the benefit of and be binding upon the Initial Purchasers, the Company, and their respective successors. The term "successors" shall not include any purchaser of the Notes as such from any of the Initial Purchasers merely by reason of such purchase. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (A) the representations, warranties, indemnities and agreements of the Company contained in this Agreement shall also be deemed to be for the benefit of directors of the Initial Purchasers, officers of the Initial Purchasers and any person or persons controlling any Initial Purchaser within the meaning of Section 15 of the Act and (B) the indemnity agreement of the Initial Purchasers contained in Section 8(b) of this Agreement shall be deemed to be for the benefit of directors of the Company, officers of the Company and any person controlling the Company within the meaning of Section 15 of the Act. Nothing in this Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section 13, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. 14. SURVIVAL. The respective indemnities, representations, warranties and agreements of the Company and the Initial Purchasers contained in this Agreement or made by or on behalf on them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the Notes and shall remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them. 28 15. DEFINITION OF THE TERM "BUSINESS DAY" and "SUBSIDIARY." For purposes of this Agreement, "business day" means any day on which the New York Stock Exchange, Inc. is open for trading and (ii) "subsidiary" means any entity the total voting capital stock of which is more than 50% controlled, either directly or indirectly by the Company or a Subsidiary. 16. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any Section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other Section, paragraph or provision hereof. If any Section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable. 17. GOVERNING LAW. (a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK. (b) Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby ("RELATED PROCEEDINGS") may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the "SPECIFIED COURTS"), and each party irrevocably submits to the non-exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such court (a "RELATED JUDGMENT"), as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice or document by mail to such party's address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient forum. 18. COUNTERPARTS. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument. 19. HEADINGS. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement. 29 If the foregoing correctly sets forth the agreement among the Company, and the Initial Purchasers, please indicate your acceptance in the space provided for that purpose below. Very truly yours, WACKENHUT CORRECTIONS CORP. By: /s/ John G. O'Rourke ----------------------------------------------------- Name: John G. O'Rourke Title: Chief Financial Officer-Senior Vice President Accepted: BNP PARIBAS SECURITIES CORP. LEHMAN BROTHERS INC. FIRST ANALYSIS SECURITIES CORPORATION SOUTHTRUST SECURITIES, INC. COMERICA SECURITIES, INC. Acting severally on behalf of themselves and the several Initial Purchasers named in Schedule I hereto: By: BNP Paribas Securities Corp. By: /s/ Douglas Cook ---------------------------------------- Name: Douglas Cook Title: Managing Director 30 SCHEDULE I PRINCIPAL AMOUNT OF NOTES TO BE INITIAL PURCHASERS PURCHASED ------------------ --------- BNP Paribas Securities Corp............................... $82,800,000 Lehman Brothers Inc....................................... 55,200,000 First Analysis Securities Corporation..................... 8,250,000 SouthTrust Securities, Inc................................ 2,250,000 Comerica Securities, Inc.................................. 1,500,000 ------------- Total................................................ $150,000,000 ============== 31 [EXHIBITS OMITTED] EX-4.1 4 g84060exv4w1.txt EX-4.1 INDENTURE EXHIBIT 4.1 ================================================================================ WACKENHUT CORRECTIONS CORPORATION 8 1/4% SENIOR NOTES DUE 2013 ------------------------------ INDENTURE Dated as of July 9, 2003 ------------------------------ THE BANK OF NEW YORK 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).........................................................2.06 (b).........................................................11.03 (c).........................................................11.03 313(a).........................................................7.06 (b)(1)......................................................N.A. (b)(2)......................................................7.06, 7.07 (c).........................................................7.06, 11.02 (d).........................................................7.06 314(a).........................................................11.05 (b).........................................................N.A. (c)(1)......................................................N.A. (c)(2)......................................................N.A. (c)(3)......................................................N.A. (d).........................................................N.A. (e).........................................................11.05 (f).........................................................N.A. 315(a).........................................................N.A. (b).........................................................N.A. (c).........................................................N.A. (d).........................................................N.A. (e).........................................................N.A. 316(a) (last sentence).........................................N.A. (a)(1)(A)...................................................N.A. (a)(1)(B)...................................................N.A. (a)(2)......................................................N.A. (b).........................................................N.A. (c).........................................................11.14 317(a)(1)......................................................N.A. (a)(2)......................................................N.A. (b).........................................................N.A. 318(a).........................................................N.A. (b).........................................................N.A. (c).........................................................11.01 - -------- N.A. means not applicable. *This Cross-Reference Table is not part of the Indenture. TABLE OF CONTENTS

PAGE ---- CROSS-REFERENCE TABLE...........................................................................................i ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE Section 1.01 Definitions...............................................................................1 Section 1.02 Other Definitions........................................................................22 Section 1.03 Incorporation by Reference of Trust Indenture Act........................................22 Section 1.04 Rules of Construction....................................................................23 ARTICLE TWO THE NOTES Section 2.01 Form and Dating..........................................................................23 Section 2.02 Execution and Authentication.............................................................24 Section 2.03 Methods of Receiving Payments on the Notes...............................................25 Section 2.04 Registrar and Paying Agent...............................................................25 Section 2.05 Paying Agent to Hold Money in Trust......................................................26 Section 2.06 Holder Lists.............................................................................26 Section 2.07 Transfer and Exchange....................................................................26 Section 2.08 Replacement Notes........................................................................39 Section 2.09 Outstanding Notes........................................................................39 Section 2.10 Treasury Notes...........................................................................40 Section 2.11 Temporary Notes..........................................................................40 Section 2.12 Cancellation.............................................................................40 Section 2.13 Defaulted Interest.......................................................................40 Section 2.14 CUSIP Numbers............................................................................41 ARTICLE THREE REDEMPTION AND PREPAYMENT; SATISFACTION AND DISCHARGE Section 3.01 Notices to Trustee.......................................................................41 Section 3.02 Selection of Notes to Be Redeemed........................................................41 Section 3.03 Notice of Redemption.....................................................................41 Section 3.04 Effect of Notice of Redemption...........................................................42 Section 3.05 Deposit of Redemption Price..............................................................42 Section 3.06 Notes Redeemed in Part...................................................................43 Section 3.07 Optional Redemption......................................................................43 Section 3.08 Repurchase Offers........................................................................44 Section 3.09 Application of Trust Money...............................................................45

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PAGE ---- ARTICLE FOUR COVENANTS Section 4.01 Payment of Notes.........................................................................46 Section 4.02 Maintenance of Office or Agency..........................................................46 Section 4.03 Reports..................................................................................47 Section 4.04 Compliance Certificate...................................................................47 Section 4.05 Taxes....................................................................................48 Section 4.06 Stay, Extension and Usury Laws...........................................................48 Section 4.07 Restricted Payments......................................................................48 Section 4.08 Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries................51 Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock...............................53 Section 4.10 Asset Sales..............................................................................57 Section 4.11 Transactions with Affiliates.............................................................59 Section 4.12 Liens....................................................................................60 Section 4.13 Business Activities......................................................................60 Section 4.14 Offer to Repurchase upon a Change of Control.............................................60 Section 4.15 Limitation on Issuances and Sales of Equity Interests in Restricted Subsidiaries.........61 Section 4.16 Designation of Restricted and Unrestricted Subsidiaries..................................61 Section 4.17 Payments for Consent.....................................................................62 Section 4.18 Sale and Leaseback Transactions..........................................................62 Section 4.19 Additional Note Guarantees...............................................................62 ARTICLE FIVE SUCCESSORS Section 5.01 Merger, Consolidation or Sale of Assets..................................................63 ARTICLE SIX DEFAULTS AND REMEDIES Section 6.01 Events of Default........................................................................64 Section 6.02 Acceleration.............................................................................65 Section 6.03 Other Remedies...........................................................................66 Section 6.04 Waiver of Past Defaults..................................................................66 Section 6.05 Control by Majority......................................................................66 Section 6.06 Limitation on Suits......................................................................67 Section 6.07 Rights of Holders of Notes to Receive Payment............................................67 Section 6.08 Collection Suit by Trustee...............................................................67 Section 6.09 Trustee May File Proofs of Claim.........................................................68 Section 6.10 Priorities...............................................................................68 Section 6.11 Undertaking for Costs....................................................................69

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PAGE ---- ARTICLE SEVEN TRUSTEE Section 7.01 Duties of Trustee........................................................................69 Section 7.02 Certain Rights of Trustee................................................................70 Section 7.03 Individual Rights of Trustee.............................................................71 Section 7.04 Trustee's Disclaimer.....................................................................71 Section 7.05 Notice of Defaults.......................................................................71 Section 7.06 Reports by Trustee to Holders of the Notes...............................................71 Section 7.07 Compensation and Indemnity...............................................................72 Section 7.08 Replacement of Trustee...................................................................73 Section 7.09 Successor Trustee by Merger, Etc.........................................................74 Section 7.10 Eligibility; Disqualification............................................................74 Section 7.11 Preferential Collection of Claims Against Company........................................74 Section 7.12 Trustee's Application for Instructions from the Company..................................74 ARTICLE EIGHT DEFEASANCE AND COVENANT DEFEASANCE Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.................................74 Section 8.02 Legal Defeasance and Discharge...........................................................75 Section 8.03 Covenant Defeasance......................................................................75 Section 8.04 Conditions to Legal or Covenant Defeasance...............................................76 Section 8.05 Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions...........................................................77 Section 8.06 Repayment to the Company.................................................................77 Section 8.07 Reinstatement............................................................................78 ARTICLE NINE AMENDMENT, SUPPLEMENT AND WAIVER Section 9.01 Without Consent of Holders of Notes......................................................78 Section 9.02 With Consent of Holders of Notes.........................................................79 Section 9.03 Compliance with Trust Indenture Act......................................................81 Section 9.04 Revocation and Effect of Consents........................................................81 Section 9.05 Notation on or Exchange of Notes.........................................................81 Section 9.06 Trustee to Sign Amendments, Etc..........................................................81 ARTICLE TEN SATISFACTION AND DISCHARGE Section 10.01 Satisfaction and Discharge...............................................................81 Section 10.02 Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions.................................................................82 Section 10.03 Repayment to the Company.................................................................83

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PAGE ---- ARTICLE ELEVEN MISCELLANEOUS Section 11.01 Trust Indenture Act Controls.............................................................83 Section 11.02 Notices..................................................................................83 Section 11.03 Communication by Holders of Notes with Other Holders of Notes............................84 Section 11.04 Certificate and Opinion as to Conditions Precedent.......................................85 Section 11.05 Statements Required in Certificate or Opinion............................................85 Section 11.06 Rules by Trustee and Agents..............................................................85 Section 11.07 No Personal Liability of Directors, Officers, Employees and Stockholders.................85 Section 11.08 Governing Law............................................................................86 Section 11.09 Consent to Jurisdiction..................................................................86 Section 11.10 No Adverse Interpretation of Other Agreements............................................86 Section 11.11 Successors...............................................................................86 Section 11.12 Severability.............................................................................86 Section 11.13 Counterpart Originals....................................................................86 Section 11.14 Acts of Holders..........................................................................87 Section 11.15 Benefit of Indenture.....................................................................88 Section 11.16 Table of Contents, Headings, Etc.........................................................88 Section 11.17 Waiver of Jury Trial.....................................................................88 EXHIBITS Exhibit A FORM OF 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 July 9, 2003 between Wackenhut Corrections Corporation, a Florida corporation (the "COMPANY") and The Bank of New York, a banking corporation organized and existing under the laws of the State of New York, as Trustee. The Company and the Trustee (as defined below) agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders (as defined below) of the 8 1/4% Senior Notes due 2013: ARTICLE ONE 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 shall be issued in a denomination equal to the outstanding principal amount at maturity of the Notes sold in reliance on Rule 144A. "ACQUIRED DEBT" means, with respect to any specified Person: (i) Indebtedness of any other Person existing at the time such other Person is merged 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 (ii) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person. "ADDITIONAL NOTES" means an unlimited maximum aggregate principal amount of Notes (other than the Notes issued on the date hereof) issued under this Indenture in accordance with Sections 2.02 and 4.09 hereof. "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, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; 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" shall have correlative meanings. "AGENT" means any Registrar, Paying Agent or co-registrar. "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, transfer, assignment, conveyance or other disposition of any assets or rights; PROVIDED that the sale, lease, conveyance, transfer, assignment or other disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries taken as a whole will be governed by Sections 4.14 and/or 5.01 hereof and not by Section 4.10 hereof; and (2) the issuance or sale by the Company or any of its Restricted Subsidiaries of Equity Interests of any of the Company's Subsidiaries. Notwithstanding the preceding, the following items will not be deemed to be Asset Sales: (i) any single transaction or series of related transactions that involves the sale of assets or the issuance or sale of Equity Interests of a Restricted Subsidiary having a fair market value of less than $2.0 million; (ii) a transfer of assets by the Company to any of its Restricted Subsidiaries or by any Restricted Subsidiary to the Company or any other Restricted Subsidiary; (iii) an issuance of Equity Interests by a Restricted Subsidiary to the Company or to another Restricted Subsidiary; (iv) the sale or lease of equipment, inventory, accounts receivable or other assets in the ordinary course of business; (v) the sale or other disposition of cash or Cash Equivalents; and (vi) a Restricted Payment or Permitted Investment that is permitted by Section 4.07 hereof. "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. "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" shall 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" shall have a corresponding meaning. 2 "BOARD OF DIRECTORS" means: (1) with respect to a corporation, the board of directors of the corporation; (2) with respect to a partnership, the board of directors of the general partner of the partnership; and (3) with respect to any other Person, the board or committee of such Person serving a similar function. "BROKER-DEALER" has the meaning set forth in the Registration Rights Agreement. "BUSINESS DAY" means any day which is not a Legal Holiday. "CAPITAL LEASE OBLIGATION" means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at 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) 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; (2) Government Securities having maturities of not more than one year from the date of acquisition; (3) certificates of deposit and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers' acceptances with maturities not exceeding one year and overnight bank deposits, in each case, with any lender party to the Credit Agreement or with any domestic commercial bank having capital and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of "B" or better; (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 the highest rating obtainable from Moody's Investors Service, Inc. or Standard & Poor's Rating Services and in each case maturing within one year after the date of acquisition; and (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. "CHANGE OF CONTROL" means the occurrence of any of the following: (1) the direct or indirect sale, transfer, assignment, lease, 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 assets of the Company and its Restricted Subsidiaries, taken as a whole, to any "person" (as that term is used in Section 13(d)(3) of the Exchange Act); (2) the adoption of a plan by the Company 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" or "group" (as that term is used in Sections 13(d) and 14(d) 3 of the Exchange Act) becomes the Beneficial Owner, directly or indirectly, of more than 40% of the Voting Stock of the Company; (4) the Company consolidates with, or merges with or into, any Person, or any Person consolidates with, or merges with or into, the Company, in any such event pursuant to a transaction in which any of the outstanding Voting Stock of the Company or such other Person is converted into or exchanged for cash, securities or other property, other than any such transaction where (A) the Voting Stock of the Company outstanding immediately prior to such transaction is converted into or exchanged for Voting Stock (other than Disqualified Stock) of the surviving or transferee Person constituting a majority of the outstanding shares of such Voting Stock of such surviving or transferee Person (immediately after giving effect to such issuance) and (B) immediately after such transaction, no "person" or "group" (as such terms are used in Section 13(d) and 14(d) of the Exchange Act), becomes, directly or indirectly, the Beneficial Owner of 40% or more of the voting power of all classes of Voting Stock of the Company; or (5) 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. "CLOSING DATE" means July 9, 2003. "COMPANY" means Wackenhut Corrections Corporation. "CONSOLIDATED CASH FLOW" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such period; PLUS, in each case, to the extent deducted in computed Consolidated Net Income, (1) losses realized by such Person and its Restricted Subsidiaries in connection with sales of assets outside the ordinary course of business; PLUS (2) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period; 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 letters of credit or bankers' acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations), net of Non-Recourse Interest Payments received in cash by the Company or any Restricted Subsidiary relating to any Non-Recourse Project Financing Indebtedness up to the amount of interest expense for such Non-Recourse Project Financing Indebtedness; PLUS 4 (4) depreciation, amortization (including amortization of intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash payments 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; MINUS (5) non-cash 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. Notwithstanding the preceding, the provision for taxes based on the income or profits of, and the depreciation and amortization and other non-cash expenses of, a Restricted Subsidiary of the Company shall be added to Consolidated Net Income to compute Consolidated Cash Flow of the Company only to the extent that a corresponding amount would be permitted at the date of determination to be dividended to the Company by such Restricted Subsidiary without prior governmental approval (that has not been obtained), and pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to that Restricted Subsidiary or its stockholders. "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 (but not loss) of any Person that is not a Restricted Subsidiary 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 shall 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; (3) the Net Income of any Person acquired during such period for any period prior to the date of such acquisition shall be excluded; (4) the cumulative effect of a change in accounting principles shall be excluded; and (5) the Net Income or loss of any Unrestricted Subsidiary will be excluded, whether or not distributed to the specified Person or one of its Restricted Subsidiaries. 5 "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; or (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. "CORPORATE TRUST OFFICE" means the principal office of the Trustee at which at any time its corporate trust business shall be administered, which office at the date hereof is located at the address of the Trustee specified in Section 11.02 hereof, or such other address as to which the Trustee may from time to time give notice to the Company and to the Holders. "CREDIT AGREEMENT" means that certain Credit Agreement, by and among the Company, the guarantor subsidiaries named therein, BNP Paribas as administrative agent for the lenders and as lead arranger and syndication agent and the other lenders named therein, and other parties thereto, including any related notes, guarantees, collateral documents, instruments and agreements executed in connection therewith, and in each case as amended (and/or amended and restated), modified, renewed, refunded, replaced or refinanced from time to time, in whole or in part, with the same or different lenders (including, without limitation, any amendment, amendment and restatement, modification, renewal, refunding, replacement or refinancing that increases the maximum amount of the loans made or to be made thereunder). "CREDIT FACILITIES" means one or more debt facilities (including, without limitation, the Credit Agreement) or commercial paper facilities, in each case with banks or other institutional lenders providing for revolving credit loans, term loans, project financings, 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) or letters of credit, in each case, as amended (and/or amended and restated), restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time. "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 2.07 hereof, substantially in the form of Exhibit A 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 2.04 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. "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 6 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 thereof have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale shall 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 Section 4.07 hereof. "DOMESTIC 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 (but not the laws of Puerto Rico) or the District of Columbia or that guarantees or otherwise provides direct credit support for any Indebtedness of the Company or any Guarantor. "EQUITY INTERESTS" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock). "EQUITY OFFERING" means an offering of Capital Stock (other than Disqualified Stock or Capital Stock that by its terms has a preference in liquidation or as to dividends over any other Capital Stock) of the Company (other than (1) an offering pursuant to a registration statement on Form S-8 or otherwise relating to equity securities issuable under any employee benefit plan of the Company and (2) an offering with aggregate Net Proceeds to the Company of less than $20.0 million). "EUROCLEAR" means Morgan Guaranty Trust Company of New York, Brussels office, an 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 in accordance with Section 2.07(f) hereof. "EXCHANGE OFFER" has the meaning set forth in the Registration Rights Agreement. "EXCHANGE OFFER REGISTRATION STATEMENT" has the meaning set forth in the Registration Rights Agreement. "EXISTING INDEBTEDNESS" means the Indebtedness of the Company and its Subsidiaries (other than Indebtedness under the Credit Agreement) in existence on the date hereof, until such amounts are repaid. "FIXED CHARGE COVERAGE RATIO" means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such Person for such period to the Fixed Charges of such Person 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 7 (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, PROVIDED, HOWEVER, that interest expense, if any, attributable to any Non-Recourse Project Financing Indebtedness computed on a pro forma basis, shall be computed giving pro forma effect to any Non-Recourse Interest Payments related to such Non-Recourse Project Financing Indebtedness, PROVIDED FURTHER that the obligation to make such Non-Recourse Interest Payments commences with the incurrence of the corresponding Non-Recourse Project Financing Indebtedness. 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, but without giving effect to clause (3) of the proviso set forth in the definition of Consolidated Net Income; (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; and (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. "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 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 letters of credit or bankers' acceptance financings, and net of the 8 effect of all payments made or received pursuant to Hedging Obligations, net of Non-Recourse Interest Payments received in cash by the Company or any Restricted Subsidiary relating to any Non-Recourse Project Financing Indebtedness up to the amount of interest expense for such Non-Recourse Project Financing Indebtedness; PLUS (2) any interest expense on Indebtedness of another Person to the extent such Indebtedness 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 (3) the product of (a) all dividends, whether paid or accrued and whether or not in cash, on any series of Disqualified Stock or 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), 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 effective cash tax rate of such Person, expressed as a decimal, in each case, determined on a consolidated basis and in accordance with GAAP. "FOREIGN SUBSIDIARY" means a Restricted Subsidiary of the Company that is not a Domestic Subsidiary. "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 amended and/or modified from time to time. All ratios and computations contained or referred to herein shall be computed in conformity with GAAP applied on a consistent basis, except that calculations made for purposes of determining compliance with the terms of the covenants and with other provisions of this Indenture shall be made without giving effect to the amortization of any expenses incurred in connection with, or the write-off of costs as a result of, the Transactions. "GLOBAL NOTE LEGEND" means the legend set forth in Section 2.07(g)(ii), 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 issued in accordance with certain sections of this Indenture. "GOVERNMENT SECURITIES" means 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. "GUARANTEE" means a guarantee other than by endorsement of negotiable instruments for collection or deposit 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. 9 "GUARANTORS" means any Restricted Subsidiary that executes a Guarantee in accordance with provisions of this Indenture and its respective successors and assigns. "HEDGING OBLIGATIONS" means, with respect to any specified Person, the obligations of such Person under: (1) interest rate swap agreements, 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. "HOLDER" means a Person in whose name a Note is registered. "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, 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 a balance sheet of the specified Person prepared in accordance with GAAP. In addition, 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. The amount of any Indebtedness outstanding as of any date will be: (A) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount; and (B) the principal amount of the Indebtedness, together with any interest on the Indebtedness that is more than 30 days past due, in the case of any other Indebtedness. "INDENTURE" means this Indenture, as amended or supplemented from time to time. 10 "INDIRECT PARTICIPANT" means a Person who holds a beneficial interest in a Global Note through a Participant. "INITIAL PURCHASERS" means the initial purchasers as defined in the Purchase Agreement dated July 1, 2003. "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. "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 commission, travel and similar advances to officers and employees made 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 and including the designation of a Restricted Subsidiary as an Unrestricted Subsidiary. 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 all Investments in such Restricted Subsidiary not sold or disposed of in an amount determined as provided in 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 fair market value of the Investment held by the acquired Person in such third Person in an amount determined as provided in the final paragraph of Section 4.07 hereof. "ISSUE DATE" means the Closing Date. "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, 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 11 lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction. "LIQUIDATED DAMAGES" means all liquidated damages then owing pursuant to Section 5 of the Registration Rights Agreement. "NET INCOME" means, with respect to any specified Person for any period, 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 (but not loss), together with any related provision for taxes on such gain (but not loss), realized in connection with: (a) any sale of assets outside the ordinary course of business; 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 (including, without limitation, any cash or Cash Equivalents received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset Sale, taxes paid or payable as a result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, and amounts required to be applied to the repayment of Indebtedness, secured by a Lien on the asset or assets that were the subject of such Asset Sale and any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP. "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 that they will not have any recourse to the stock, property or assets of the Company or any of its Restricted Subsidiaries. 12 "NON-RECOURSE PROJECT FINANCING INDEBTEDNESS" means any Indebtedness of a Restricted Subsidiary (the "PROJECT FINANCING SUBSIDIARY") incurred in connection with the acquisition, construction or development of any facility: (1) where such Project Financing Subsidiary operates or is responsible for the operation of the facility pursuant to a management services contract with a governmental entity; (2) as to which neither the Company nor any of its Restricted Subsidiaries, other than such Project Financing Subsidiary, (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), it being understood that equity Investments funded at the time of or prior to the incurrence of such Indebtedness shall not be deemed credit support or (b) is directly or indirectly liable as a guarantor or otherwise; (3) where, upon the termination of the management services contract with respect to such facility, neither the Company nor any of its Restricted Subsidiaries, other than the Project Financing Subsidiary, will be liable, directly or indirectly, to make any payments with respect to such Indebtedness (or portion thereof); (4) the interest expense related to such Indebtedness is fully serviced by a separate corresponding payment with respect to such Indebtedness (the "NON-RECOURSE INTEREST PAYMENT") pursuant to an agreement with the governmental entity; and (5) such Project Financing Subsidiary has no assets other than the assets, including working capital, reasonably related to the design, construction, management and financing of the facility. "NON-U.S. PERSON" means a Person who is not a U.S. Person. "NOTE GUARANTEE" has a meaning set forth in Exhibit F. "NOTES" means the 8 1/4% Senior Notes due 2013 of the Company issued on the date hereof and any Additional Notes, including the Exchange Notes. The Notes and the Additional Notes, if any, shall be treated as a single class for all purposes under this Indenture. "OBLIGATIONS" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness. "OFFERING" means the offering of the Notes by the Company. "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, an Assistant Secretary or any Vice-President of such Person. 13 "OFFICERS' CERTIFICATE" means a certificate signed on behalf of the Company by at least 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 11.05 hereof. "OPINION OF COUNSEL" means an opinion from legal counsel who is reasonably acceptable to the Trustee, that meets the requirements of Section 11.05 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 BUSINESS" means the business conducted by the Company and its Restricted Subsidiaries on the date hereof and businesses reasonably related thereto or ancillary or incidental thereto or a reasonable extension thereof, including the privatization of governmental services. "PERMITTED DEBT" has the meaning set forth in Section 4.09(b) hereof. "PERMITTED INVESTMENTS" means: (1) any Investment in the Company or in a Restricted Subsidiary of the Company that is a Guarantor (other than a Project Financing Subsidiary); (2) any Investment in cash or Cash Equivalents; (3) Investments in a Restricted Subsidiary that is not a Guarantor having an aggregate fair market value, when taken together with all other Investments made pursuant to this clause (3) not to exceed $5.0 million; (4) Investments in a Foreign Subsidiary in an amount not to exceed the amount of Net Proceeds received from the sale of the Company's one-half ownership interest in Premier Custodial Group to Serco Investments Limited; (5) any Investment by the Company or any Restricted Subsidiary of the Company in a Person (other than a Project Financing Subsidiary), if as a result of such Investment: (a) such Person becomes (i) a Restricted Subsidiary of the Company and (ii) a Guarantor; or (b) 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 any Restricted Subsidiary of the Company that is a Guarantor; (6) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to Section 4.10; 14 (7) [Intentionally omitted]; (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 entered into the ordinary course of business and not for any speculative purpose; (10) other Investments in any other 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 (10) not to exceed: (a) $15.0 million; PLUS (b) the net reductions in Investments made pursuant to this clause (10) resulting from distributions on or repayments of such Investments or from the net cash proceeds from the sale or other disposition of any such investment; PROVIDED that the net reduction in any Investment shall not exceed the amount of such Investment; (11) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business; (12) loans or advances to employees made in the ordinary course of business of the Company or any Restricted Subsidiary not to exceed $2.0 million outstanding at any one time for all loans or advances under this clause (12); (13) stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Company or any Restricted Subsidiary or in satisfaction of judgments or pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of a debtor; (14) Investments in existence on the date hereof; (15) Investments that are made or received in exchange for Equity Interests (other than Disqualified Stock) of the Company; (16) Investments in South African Services Pty Ltd. having an aggregate fair market value, when taken together with all other Investments made pursuant to this clause (16) not to exceed $3.0 million; and (17) any Investments made or acquired with the net cash proceeds of a substantially concurrent issuance or sale of Equity Interests (other than Disqualified Stock) of the Company. "PERMITTED LIENS" means: 15 (1) Liens on any assets (including real or personal property) of the Company and any Restricted Subsidiary securing Indebtedness and other Obligations under Credit Facilities that were permitted by the terms of this Indenture to be incurred; (2) Liens in favor of the Company or the Guarantors; (3) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with the Company or any Restricted 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 Restricted Subsidiary; (4) Liens on property existing at the time of acquisition of the property by the Company or any Restricted Subsidiary of the Company, PROVIDED that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any property other than the property so acquired by the Company or the Restricted Subsidiary; (5) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business; (6) Liens to secure Indebtedness (including Capital Lease Obligations) incurred under Section 4.09(b)(iv); (7) Liens existing on the date hereof; (8) 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; (9) Liens securing Permitted Refinancing Indebtedness; PROVIDED that any such Lien does not extend to or cover any property, Capital Stock or Indebtedness other than the property, shares or debt securing the Indebtedness so refunded, refinanced or extended; (10) Attachment or judgment Liens not giving rise to a Default or an Event of Default; (11) Liens on the Capital Stock of Unrestricted Subsidiaries securing Indebtedness of such Unrestricted Subsidiaries; (12) Liens incurred in the ordinary course of business of the Company or any Subsidiary of the Company with respect to obligations that do not exceed $5.0 million at any one time outstanding; (13) pledges or deposits under workmen's compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for 16 the payment of Indebtedness) or leases to which the Company or any Restricted Subsidiary is a party, or deposits to secure public or statutory obligations of the Company or any Restricted Subsidiary or deposits or cash or Government Securities to secure surety or appeal bonds to which the Company or any Restricted Subsidiary is a party, or deposits as security for contested taxes or import or customs duties or for the payment of rent, in each case incurred in the ordinary course of business; (14) Liens imposed by law, including carriers', warehousemen's and mechanics' Liens, in each case for sums not yet due or being contested in good faith by appropriate proceedings if a reserve or other appropriate provisions; if any, as shall be required by GAAP shall have been made in respect thereof; (15) encumbrances, easements or reservations of, or rights of others for, licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real properties or liens incidental to the conduct of the business of the Company or a Restricted Subsidiary or to the ownership of its properties which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of the Company or such Restricted Subsidiary; (16) Liens securing Hedging Obligations so long as the related Indebtedness is secured by a Lien on the same property securing such Hedging Obligations; (17) leases and subleases of real property which do not materially interfere with the ordinary conduct of the business of the Company or any of its Restricted Subsidiaries; and (18) normal customary rights of setoff upon deposits of cash in favor of banks or other depository institutions. "PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of the Company or any of its Restricted Subsidiaries issued in repayment of, exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, repay, defease or refund other Indebtedness of the Company or any of its Restricted Subsidiaries (other than intercompany Indebtedness and Disqualified Stock of the Company or a Restricted Subsidiary); 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 so extended, refinanced, renewed, replaced, repaid, defeased or refunded (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 later 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 extended, refinanced, renewed, replaced, repaid, defeased or refunded; 17 (3) if the Indebtedness being extended, refinanced, renewed, replaced, repaid, defeased or refunded 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 extended, refinanced, renewed, replaced, repaid, defeased or refunded; and (4) such Indebtedness is incurred either by the Company or by any Restricted Subsidiary who is an obligor on the Indebtedness being extended, refinanced, renewed, replaced, repaid, defeased or refunded. "PERSON" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity. "PRIVATE PLACEMENT LEGEND" means the legend set forth in Section 2.07(g)(i) 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. "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement, dated as of July 9, 2003, by and among 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. "REGULATION S" means Regulation S promulgated under the Securities Act. "REGULATION S GLOBAL NOTE" means a global note 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 nominees that shall be issued in a denomination equal to the outstanding principal amount at maturity of the Notes resold in reliance on Regulation S. "RESPONSIBLE OFFICER," when used with respect to the Trustee, means any vice president, assistant vice president, treasurer, assistant treasurer or other trust officer within the Corporate Trust Office 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 or her knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture. "RESTRICTED DEFINITIVE NOTE" means a Definitive Note bearing the Private Placement Legend. "RESTRICTED GLOBAL NOTE" means a Global Note bearing the Private Placement Legend. 18 "RESTRICTED INVESTMENT" means an Investment other than a Permitted Investment. "RESTRICTED SUBSIDIARY" of the Company means any Subsidiary of the Company 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 the Securities Act. "SALE AND LEASEBACK TRANSACTIONS" means any direct or indirect arrangement relating to property now owned or hereafter acquired whereby the Company or a Restricted Subsidiary transfers such property to another Person and the Company or a Restricted Subsidiary leases it from such Person other than a lease properly characterized pursuant to GAAP as a Capital Lease Obligation, PROVIDED, HOWEVER, that, with respect to properties developed or acquired by the Company after the date hereof, any sale and leaseback of such properties pursuant to the Right to Purchase Agreement, dated as of April 28, 1998 between the Company and CPT Operating Partnership L.P. shall not be deemed a Sale and Leaseback Transaction hereunder. "SEC" means the Securities and Exchange Commission. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SHELF REGISTRATION STATEMENT" means the Shelf Registration Statement as defined in the Registration Rights Agreement. "SIGNIFICANT SUBSIDIARY" means any 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 such payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall 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 thereof is at the time owned or controlled, directly or indirectly, by such 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 19 of such Person or (b) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof). "TIA" means the Trust Indenture Act of 1939, as in effect on the date on which this Indenture is qualified under the TIA. "TRANSACTIONS" means (i) the repurchase by the Company of 12.0 million shares of its common stock, (ii) the Credit Agreement and (iii) the Offering. "TRUSTEE" means The Bank of New York, 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 one or more Definitive Notes that do not bear and are not required to bear the Private Placement Legend. "UNRESTRICTED GLOBAL NOTE" means a permanent Global Note substantially in the form of Exhibit A attached hereto that bears the Global Note Legend and that has the "Schedule of Exchanges of Interests in the Global Note" attached thereto, and that is deposited with or on behalf of and registered in the name of the Depositary, representing a series of Notes that do not bear the Private Placement Legend. "UNRESTRICTED SUBSIDIARY" means any Subsidiary of the Company that is designated by the Board of Directors of the Company as an Unrestricted Subsidiary pursuant to a Board Resolution, but only to the extent that 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 filing with the Trustee a certified copy of the Board Resolution giving effect to such designation and an Officers' Certificate certifying that such designation complied with the preceding conditions and was permitted under Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any 20 Indebtedness of such Subsidiary shall 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 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 or Event of 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 the 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" table under the heading "Currency Trading" on the date two Business Days prior to such determination. Except as described in 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 was initially incurred in such currency. "U.S. PERSON" means a U.S. person as defined in Rule 902(k) 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 or liquidation preference, as the case may be, 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 or liquidation preference, as the case may be, 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) shall at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted Subsidiaries of such Person. 21 "WHOLLY OWNED SUBSIDIARY" of any specified Person means a Subsidiary of such Person all of the outstanding Capital Stock or other ownership interest of which (other than directors' qualifying shares) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person and one or more Wholly Owned Subsidiaries of such Person. Section 1.02 OTHER DEFINITIONS. DEFINED IN TERM SECTION "AFFILIATE TRANSACTION".................................. 4.11 "ASSET SALE OFFER"....................................... 4.10 "AUTHENTICATION ORDER"................................... 2.02 "CHANGE OF CONTROL OFFER"................................ 4.14 "CHANGE OF CONTROL PAYMENT".............................. 4.14 "CHANGE OF CONTROL PAYMENT DATE"......................... 4.14 "COVENANT DEFEASANCE".................................... 8.03 "DTC".................................................... 2.04 "EVENT OF DEFAULT"....................................... 6.01 "EXCESS PROCEEDS"........................................ 4.10 "INCUR".................................................. 4.09 "LEGAL DEFEASANCE"....................................... 8.02 "OFFER AMOUNT"........................................... 3.08 "OFFER PERIOD"........................................... 3.08 "OFFSHORE TRANSACTION"................................... 2.07 "PAYING AGENT"........................................... 2.04 "PAYMENT DEFAULT"........................................ 6.01 "PERMITTED DEBT"......................................... 4.09 "PURCHASE DATE".......................................... 3.08 "REGISTRAR".............................................. 2.04 "RELATED JUDGMENT"....................................... 11.09 "RELATED PROCEEDINGS".................................... 11.09 "REPURCHASE OFFER"....................................... 3.08 "RESALE RESTRICTION TERMINATION DATE".................... 2.07 "RESTRICTED PAYMENTS".................................... 4.07 "SPECIFIED COURTS"....................................... 11.09 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; 22 "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 means the Company and any successor obligor upon the Notes. All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule under the TIA have the meanings so assigned to them. Section 1.04 RULES OF CONSTRUCTION. Unless the context otherwise requires: (i) a term has the meaning assigned to it; (ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP; (iii) "or" is not exclusive; (iv) words in the singular include the plural, and in the plural include the singular; (v) provisions apply to successive events and transactions; and (vi) references to sections of or rules under the Securities Act shall be deemed to include substitute, replacement of successor sections or rules adopted by the SEC from time to time. ARTICLE TWO THE NOTES Section 2.01 FORM AND DATING. (a) GENERAL. The Notes and the Trustee's certificate of authentication shall be substantially in the form of Exhibit A hereto. The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage. Each Note shall be dated the date of its authentication. The Notes shall be issued in registered, global form without interest coupons and only shall be in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof. The terms and provisions contained in the Notes shall constitute, and are hereby expressly made, a part of this Indenture and the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. However, 23 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 shall be substantially in the form of Exhibit A attached 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 shall be substantially in the form of Exhibit A attached 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 shall represent such of the outstanding Notes as shall be specified therein and each shall provide that it shall represent 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 shall be made by the Trustee in accordance with instructions given by the Holder thereof as required by Section 2.07 hereof. (c) 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 shall be applicable to transfers of beneficial interests in the Regulation S Global Notes that are held by Participants through Euroclear or Clearstream. Section 2.02 EXECUTION AND AUTHENTICATION. One Officer of the Company shall sign the Notes for the Company by manual or facsimile signature. If an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated, the Note shall nevertheless be valid. A Note shall not be valid until authenticated by the manual signature of the Trustee. Such signature shall be conclusive evidence and the only evidence, that the Note has been authenticated and delivered under this Indenture. The aggregate principal amount of Notes which may be authenticated and delivered under this Indenture is unlimited. The Trustee shall, upon a written order of the Company signed by one Officer of the Company (an "AUTHENTICATION ORDER"), authenticate Notes for original issue on the date hereof of $150.0 million. At any time and from time to time after the execution of this Indenture, the Trustee shall, upon receipt of an Authentication Order, authenticate Notes for original issue in aggregate principal amount specified in such Authentication Order. The Authentication Order shall specify the amount of Notes to be authenticated and the date on which the Notes are to be authenticated. In authenticating such Notes, and accepting the additional responsibilities under this Indenture in relation to such Notes, the Trustee shall be entitled to receive and shall be fully protected in relying upon: 24 (a) A copy of the resolution or resolutions of the Board of Directors of the Company in or pursuant to which the terms of the Notes were established, certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect as of the date of such certificate; (b) an Officers' Certificate delivered in accordance with Section 11.04(i) hereof; and (c) an Opinion of Counsel which shall state: (1) that such Notes, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting the enforcement of creditors' rights and to general equity principles; and (2) that all laws and corporate requirements in respect of the execution and delivery by the Company of such Notes have been complied with. The Trustee shall have the right to decline to authenticate and deliver any Notes under this Section if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith shall determine that such action would expose the Trustee to personal liability to existing Holders. 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 METHODS OF RECEIVING PAYMENTS ON THE NOTES. If a Holder of Notes has given wire transfer instructions to the Company, the Company shall 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 shall 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 addresses set forth in the register of Holders. Section 2.04 REGISTRAR AND PAYING AGENT. (a) The Company shall 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"). 25 The Registrar shall 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 prior notice to any Holder. The Company shall 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. (b) The Company initially appoints The Depositary Trust Company ("DTC") to act as Depositary with respect to the Global Notes. (c) 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 2.05 PAYING AGENT TO HOLD MONEY IN TRUST. The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent shall hold in trust for the benefit of 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 shall 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 one of its Subsidiaries) shall have no further liability for the money. If the Company or one of its Subsidiaries acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the Company, the Trustee shall serve as Paying Agent for the Notes. Section 2.06 HOLDER LISTS. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is not the Registrar, the Company shall 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 ss. 312(a). Section 2.07 TRANSFER AND EXCHANGE. (a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may not be transferred as a whole except 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 shall be exchanged by the Company for Definitive Notes if (i) the Company delivers to the Trustee notice from the Depositary that it is unwilling or 26 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 120 days after the date of such notice from the Depositary; (ii) 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 or (iii) there shall have occurred and be continuing a Default or Event of Default with respect to the Notes. Upon the occurrence of any of the preceding events in (i), (ii) or (iii) 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 2.08 and 2.11 hereof. Every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.07 or Section 2.08 or 2.11 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 2.07(a), however, beneficial interests in a Global Note may be transferred and exchanged as provided in Section 2.07(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 shall be effected through the Depositary, in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in the Restricted Global Notes shall 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 shall require compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as applicable: (i) 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. 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 2.07(b)(i). (ii) 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 2.07(b)(i) above, the transferor of such beneficial interest must deliver to the Registrar either (A) (1) 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 the Global Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or (B) (1) 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 (2) 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. Upon consummation of an Exchange Offer by the Company in accordance with Section 2.07(f) hereof, the requirements of this Section 2.07(b)(ii) shall be deemed to have been 27 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 at maturity of the relevant Global Notes pursuant to Section 2.07(h) hereof. (iii) 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 2.07(b)(ii) above and the Registrar receives the following: (A) if the transferee shall 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; and (B) if the transferee shall take delivery in the form of a beneficial interest in the Regulation S Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof. (iv) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN A RESTRICTED GLOBAL NOTE FOR BENEFICIAL INTERESTS IN THE 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 2.07(b)(ii) 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 (1) a Broker-Dealer, (2) a Person participating in the distribution of the Exchange Notes or (3) 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 28 (D) the Registrar receives the following: (1) 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 (2) 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. (i) 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; 29 (B) if such beneficial interest is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof; (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 under the Securities Act, 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 under the Securities Act, 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 2.07(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 2.07(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 2.07(c)(i) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein. (ii) 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 30 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 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 (1) a Broker-Dealer, (2) a Person participating in the distribution of the Exchange Notes or (3) 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: (1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Definitive Note that does not bear the Private Placement Legend, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (1)(b) thereof; or (2) 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 Definitive Note that does not bear the Private Placement Legend, 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. (iii) 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 2.07(b)(ii) hereof, the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.07(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 pursuant 31 to this Section 2.07(c)(iii) 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 pursuant to this Section 2.07(c)(iii) shall not bear the Private Placement Legend. (d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR BENEFICIAL INTERESTS. (i) 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 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 under the Securities Act, 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 under the Securities Act, 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 under the Securities Act, 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 32 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 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, and in the case of clause (C) above, the Regulation S Global Note. (ii) 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 (1) a Broker-Dealer, (2) a Person participating in the distribution of the Exchange Notes or (3) 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: (1) 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 (2) 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. 33 Upon satisfaction of the conditions of any of the subparagraphs in this Section 2.07(d)(ii), the Trustee shall cancel the Definitive Notes and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Note. (iii) 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 shall 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 (ii)(B), (ii)(D) or (iii) 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 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 2.07(e), the Registrar shall register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Registrar the Definitive Notes duly 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 shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.07(e). (i) 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 shall be made pursuant to Rule 144A under the Securities Act, 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 shall 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 shall 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. 34 (ii) 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 (1) a Broker-Dealer, (2) a Person participating in the distribution of the Exchange Notes or (3) 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: (1) 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 (2) 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; 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 Company 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. (iii) 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 shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02, the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an 35 aggregate principal amount equal to the principal amount of the beneficial interests in the Restricted Global Notes tendered for acceptance by Persons that certify in the applicable Letters of Transmittal that (x) they are not a Broker-Dealer who acquired Notes directly from the Company or an affiliate of the Company, (y) they are not participating in a distribution of the Exchange Notes and (z) they are not affiliates (as defined in Rule 144) of the Company, and accepted for exchange in the Exchange Offer and (ii) Definitive Notes in an aggregate principal amount equal to the principal amount of the Restricted Definitive Notes accepted for exchange in the Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall cause the aggregate principal amount of the applicable Restricted Global Notes to be reduced accordingly, and the Company shall execute and the Trustee shall 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 shall 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. (i) PRIVATE PLACEMENT LEGEND. Except as permitted 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 AND ANY GUARANTEES OF THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY GUARANTEES OF THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS 36 DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. Notwithstanding the foregoing, any Global Note or Definitive Note issued pursuant to subparagraph (b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.07 (and all Notes issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend. (ii) GLOBAL NOTE LEGEND. Each Global Note shall 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 (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.07(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.12 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. (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 shall be returned to or retained and canceled by the Trustee in accordance with Section 2.12 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 shall take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive 37 Notes, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall 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 shall take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement shall 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. (i) To permit registrations of transfers and exchanges, the Company shall execute and the Trustee shall authenticate Global Notes and Definitive Notes upon the Company's order or at the Registrar's request. (ii) No service charge shall 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 2.11, 3.06, 3.08, 4.10, 4.14 and 9.05 hereof). (iii) The Registrar shall not be required to register the transfer of or exchange any Note selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part. (iv) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid and legally binding 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. (v) The Company shall not 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 so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part or (C) to register the transfer of or to exchange a Note between a record date and the next succeeding Interest Payment Date (as defined in the Notes). (vi) 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. (vii) The Trustee shall authenticate Global Notes and Definitive Notes in accordance with the provisions of Section 2.02 hereof. 38 (viii) All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.07 to effect a registration of transfer or exchange may be submitted by facsimile with the original to follow by first class mail. (ix) The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof. Section 2.08 REPLACEMENT NOTES. (a) 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 shall issue and the Trustee, upon receipt of an Authentication Order, shall 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. (b) Every replacement Note is an additional obligation of the Company and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder. Section 2.09 OUTSTANDING NOTES. (a) 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 as not outstanding. Except as set forth in Section 2.10 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 Company or a Subsidiary of the Company shall not be deemed to be outstanding for purposes of Section 3.07(b) hereof. (b) If a Note is replaced pursuant to Section 2.08 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser. (c) 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. (d) If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any of the foregoing) holds, on a redemption date or maturity date, money sufficient to pay Notes payable on that date, then on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to accrue interest. 39 Section 2.10 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 by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company, shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that the Trustee knows are so owned shall be so disregarded. Section 2.11 TEMPORARY NOTES. (a) Until certificates representing Notes are ready for delivery, the Company may prepare and the Trustee, upon receipt of an Authentication Order, shall authenticate temporary Notes. Temporary Notes shall be substantially in the form of certificated Notes but may have variations that the Company considers appropriate for temporary Notes and as shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Definitive Notes in exchange for temporary Notes. (b) Holders of temporary Notes shall be entitled to all of the benefits of this Indenture. Section 2.12 CANCELLATION. The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall dispose of canceled Notes in accordance with its procedures for the disposition of canceled securities in effect as of the date of such disposition (subject to the record retention requirement of the Exchange Act). Certification of the disposition of all canceled Notes shall 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 2.13 DEFAULTED INTEREST. If the Company defaults in a payment of interest on the Notes, it shall 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 shall 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 shall fix or cause to be fixed each such special record date and payment date, PROVIDED that no such special record date shall 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) shall 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. 40 Section 2.14 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 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. ARTICLE THREE REDEMPTION AND PREPAYMENT; SATISFACTION AND DISCHARGE 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 shall furnish to the Trustee, at least 30 days but not more than 60 days before a redemption date, an Officers' Certificate setting forth (i) the clause of this Indenture pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption price. Section 3.02 SELECTION OF NOTES TO BE REDEEMED. (a) If less than all of the Notes are to be redeemed or purchased in an offer to purchase at any time, the Trustee shall select the Notes to be redeemed or purchased among the Holders of the Notes in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a PRO RATA basis, by lot or in accordance with any other method the Trustee considers fair and appropriate. In the event of partial redemption by lot, the particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption date by the Trustee from the outstanding Notes not previously called for redemption. (b) The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount at maturity thereof to be redeemed. No Notes in amounts of $1,000 or less shall be redeemed in part. Notes and portions of Notes selected shall 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, the entire outstanding amount of Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. Section 3.03 NOTICE OF REDEMPTION. (a) Subject to the provisions of Section 3.08 hereof, at least 30 days but not more than 60 days before a redemption date, the Company shall 41 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. The notice shall identify the Notes to be redeemed and shall state: (i) the redemption date; (ii) the redemption price; (iii) if any Note is being redeemed in part, the portion of the principal amount at maturity 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 of the original Note shall be issued in the name of the Holder thereof upon cancellation of the original Note; (iv) the name and address of the Paying Agent; (v) that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price and become due on the date fixed for redemption; (vi) 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; (vii) the paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and (viii) 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. (b) At the Company's request, the Trustee shall give the notice of redemption in the Company's name and at its expense; PROVIDED, HOWEVER, that the Company shall have 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. The notice, if mailed in the manner provided herein shall be presumed to have been given, whether or not the Holder receives such notice. 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. A notice of redemption may not be conditional. Section 3.05 DEPOSIT OF REDEMPTION PRICE. (a) One Business Day prior to the redemption date, the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price of and accrued interest and Liquidated Damages, if any, on all Notes to be redeemed on that date. The Trustee or the Paying Agent shall 42 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 price of, and accrued interest on, all Notes to be redeemed. (b) If the Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest shall cease to accrue on the Notes or the portions of Notes called for redemption. If a Note is redeemed 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 shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal, from the redemption 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 IN PART. Upon surrender of a Note that is redeemed in part, the Company shall issue and the Trustee shall authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered. No Notes in denominations of $1,000 or less shall be redeemed in part. Section 3.07 OPTIONAL REDEMPTION. (a) Except as set forth in clause (b) of this Section 3.07, the Company shall not have the option to redeem the Notes pursuant to this Section 3.07 on or prior to July 15, 2008. Thereafter, the Company may redeem all or a part of the Notes upon not less than 30 nor more than 60 days' notice, at the redemption prices (expressed as percentages of principal amount) set forth below plus accrued and unpaid interest and Liquidated Damages, if any, thereon, to the applicable redemption date, if redeemed during the twelve-month period beginning on July 15 of the years indicated below: YEAR PERCENTAGE ---- ---------- 2008......................... 104.125% 2009 ........................ 102.750% 2010 ........................ 101.375% 2011 and thereafter ......... 100.000% (b) At any time on or prior to July 15, 2006, the Company may on any one or more occasions redeem up to 35% of the aggregate principal amount of Notes originally issued hereunder at a redemption price of 108.250% 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 Equity Offerings; PROVIDED that (A) at least 65% of the aggregate principal amount of the Notes originally issued under this Indenture remains outstanding immediately after the occurrence of such redemption, excluding Notes held by the Company and its Subsidiaries; and (B) the redemption must occur within 90 days of the date of the closing of such Equity Offering. 43 (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 REPURCHASE OFFERS. In the event that, pursuant to Sections 4.10 and 4.14 hereof, the Company shall be required to commence an offer to all Holders to purchase their respective Notes (a "REPURCHASE OFFER"), it shall follow the procedures specified below. The Repurchase Offer shall 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 shall purchase the principal amount of Notes required to be purchased pursuant to Sections 4.10 and 4.14 hereof (the "OFFER AMOUNT") or, if less than the Offer Amount has been tendered, all Notes tendered in response to the Repurchase Offer. Payment for any Notes so purchased shall 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 shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Repurchase Offer. Upon the commencement of a Repurchase Offer, the Company shall send, by first class mail, a notice to the Trustee and each of the Holders, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Repurchase Offer. The Repurchase Offer shall be made to all Holders. The notice, which shall govern the terms of the Repurchase Offer, shall state: (i) that the Repurchase Offer is being made pursuant to this Section 3.08 and Section 4.10 or Section 4.14 hereof, and the length of time the Repurchase Offer shall remain open; (ii) the Offer Amount, the purchase price and the Purchase Date; (iii) that any Note not tendered or accepted for payment shall continue to accrete or accrue interest and Liquidated Damages, if any; (iv) that, unless the Company defaults in making such payment, any Note (or portion thereof) accepted for payment pursuant to the Repurchase Offer shall cease to accrete or accrue interest and Liquidated Damages, if any, after the Purchase Date; (v) that Holders electing to have a Note purchased pursuant to a Repurchase Offer may elect to have Notes purchased in integral multiples of $1,000 only; (vi) that Holders electing to have a Note purchased pursuant to any Repurchase Offer shall be required to surrender the Note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Note completed, or transfer by book-entry transfer, to the 44 Company, the 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; (vii) that Holders shall 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; (viii) that, if the aggregate amount of Notes surrendered by Holders exceeds the Offer Amount, the Trustee shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Trustee so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased); and (ix) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer). On the Purchase Date, the Company shall, 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 Repurchase Offer, or if less than the Offer Amount has been tendered, all Notes tendered, and shall deliver to the Trustee 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 3.08. The Company, the Depositary or the Paying Agent, as the case may be, shall 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 Notes tendered by such Holder, as the case may be, and accepted by the Company for purchase, and the Company, shall promptly issue a new Note. The Trustee, upon written request from the Company shall authenticate and mail or deliver such new Note to such Holder, in a principal amount at maturity 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 respective Holder thereof. The Company shall publicly announce the results of the Repurchase Offer as soon as practicable after the Purchase Date. The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act, and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to an Asset Sale Offer. Other than as specifically provided in this Section 3.08, any purchase pursuant to this Section 3.08 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof. Section 3.09 APPLICATION OF TRUST MONEY. All money deposited with the Trustee pursuant to Section 10.02 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 45 Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium, if any) and interest for 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. ARTICLE FOUR COVENANTS Section 4.01 PAYMENT OF NOTES. (a) The Company shall pay or cause to be paid the principal of, premium, if any, and interest on the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Company or one of its Subsidiaries, holds as of 11:00 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 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. (b) 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. (a) The Company shall maintain in the Borough of Manhattan, The City of New York, an office or agency (which may be an office of the Trustee or an agent 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 shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee. (b) 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 Borough of Manhattan, The City of New York for such purposes. The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. 46 (c) The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with Section 2.04 of this Indenture. Section 4.03 REPORTS. (a) Whether or not required by the SEC, so long as any Notes are outstanding, the Company shall furnish to the Holders of Notes, within the time periods specified in the SEC's rules and regulations: (i) all quarterly and annual financial information that would be required to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Company were required to file such Forms, including a "Management's Discussion and Analysis of Financial Condition and Results of Operations" and, with respect to the annual information only, a report on the annual financial statements by the Company's certified independent accountants; and (ii) all current reports that would be required to be filed with the SEC on Form 8-K if the Company were required to file such reports. (b) In addition, whether or not required by the SEC, the Company shall file a copy of all of the information and reports referred to in clauses (a)(i) and (ii) above with the SEC for public availability within the time periods specified in the SEC's rules and regulations (unless the SEC will not accept such a filing) and make such information available to securities analysts and prospective investors upon request. In addition, the Company shall, for so long as any Notes remain outstanding, 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, if any such information is required to be delivered. (c) If the Company has designated any of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly and annual financial information required by the preceding paragraph shall include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, and in "Management's Discussion and Analysis of Financial Condition and Results of Operations," of the financial condition and results of operations of the Company and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Company. Section 4.04 COMPLIANCE CERTIFICATE. (a) The Company shall and shall cause each Guarantor (to the extent that such Guarantor is so required under the TIA) to 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 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 its obligations under this Indenture and is not in default in the performance or observance of any of the terms, provisions 47 and conditions of this Indenture (or, if a Default or Event of Default shall have 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 not contrary to the then current recommendations of the American Institute of Certified Public Accountants, the year-end financial statements delivered pursuant to Section 4.03(a) above shall be accompanied by a written statement of the Company's independent public accountants (which shall be a firm of established national reputation) that in making the examination necessary for certification of such financial statements, nothing has come to their attention that would lead them to believe that the Company has violated any provisions of Article Four or Article Five hereof or, if any such violation has occurred, specifying the nature and period of existence thereof, it being understood that such accountants shall not be liable directly or indirectly to any Person for any failure to obtain knowledge of any such violation. (c) The Company shall, so long as any of the Notes are outstanding, 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 its Subsidiaries to pay, prior to delinquency, any 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 (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waive all benefit or advantage of any such law, and covenant that they 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: (i) 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 or consolidation involving the Company or any Restricted Subsidiary) or to the direct or indirect 48 holders of the Company's or any Restricted Subsidiary's 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); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Company) any Equity Interests of the Company; (iii) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness that is expressly subordinated to the Notes or any Guarantee, except a payment of interest or principal at the Stated Maturity thereof; or (iv) make any Restricted Investment (all such payments and other actions set forth in clauses (i) through (iv) above being collectively referred to as "RESTRICTED PAYMENTS"), unless, at the time of and after giving effect to such Restricted Payment: (v) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence of such Restricted Payment; and (vi) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.09(a); and (vii) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the date hereof (excluding Restricted Payments permitted by Section 4.07(b), (ii), (iii), (iv) and (v)), is less than the sum, without duplication, of: (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 hereof 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) (i) 100% of the aggregate net cash proceeds plus (ii) 70% of the aggregate fair market value of assets (other than Restricted Investments), in each case, received by the Company since the date hereof as a contribution to its common equity capital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock), except to the extent used to make an Investment pursuant to clause (17) or (15) of the definition of Permitted Investments, or from the issue or sale of convertible or exchangeable Disqualified 49 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) to the extent that any Restricted Investment that was made after the date hereof is sold for cash or otherwise liquidated or repaid for cash, the lesser of (i) the cash return of capital with respect to such Restricted Investment (less the cost of disposition, if any) and (ii) the initial amount of such Restricted Investment; PLUS (D) to the extent that any Unrestricted Subsidiary of the Company is redesignated as a Restricted Subsidiary after the date hereof, the lesser of (i) the fair market value of the Company's Investment in such Subsidiary as of the date of such redesignation or (ii) such fair market value as of the date on which such Subsidiary was originally designated as an Unrestricted Subsidiary, plus the amount of any Investments made in such Subsidiary subsequent to such designation (and treated as Restricted Payments) by the Company or any Restricted Subsidiary; PLUS (E) 100% of any other dividends or other distributions received by the Company or a Restricted Subsidiary of the Company since the date hereof from an Unrestricted Subsidiary of the Company to the extent that such dividends were not otherwise included in Consolidated Net Income of the Company for such period in an amount not to exceed the amount of Restricted Investments previously made by the Company and its Restricted Subsidiaries in such Unrestricted Subsidiary; PLUS (F) $5.0 million. (b) So long as no Default has occurred and is continuing or would be caused thereby, the preceding provisions will not prohibit: (i) the payment of any dividend within 60 days after the date of declaration of the dividend, if at the date of declaration the dividend payment would have complied with the provisions of this Indenture; (ii) the redemption, repurchase, retirement, defeasance or other acquisition of any subordinated Indebtedness of the Company or any Guarantor or of any Equity Interests of the Company in exchange for, or out of the net cash proceeds of the substantially concurrent sale (other than to a Subsidiary of the Company) of, Equity Interests of the Company (other than Disqualified Stock); PROVIDED that the amount of any such net cash proceeds that are utilized for any such redemption, repurchase, retirement, defeasance or other acquisition will be excluded from Section 4.07(a)(vii)(B); 50 (iii) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness of the Company or any Guarantor with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness; (iv) the payment of any dividend by a Restricted Subsidiary of the Company to the holders of its Equity Interests on a pro rata basis; (v) repurchases of Equity Interests of the Company deemed to occur upon the exercise of stock options if such Equity Interests represent a portion of the exercise price thereof; (vi) the repurchase, redemption or other acquisition or retirement for value of Equity Interests of the Company or any Restricted Subsidiary of the Company held by any member of the Company's (or any of its Restricted Subsidiaries') management; PROVIDED that the aggregate amount expended pursuant to this clause (vi) shall not exceed $1.0 million in any twelve-month period; (vii) cash payments, in lieu of fractional shares issuable as dividends on Equity Interests of the Company in an amount, when taken together with all other cash payments made pursuant to this clause (vii) since the date hereof, not to exceed $500,000; and (viii) Restricted Payments not otherwise permitted in an amount not to exceed $5.0 million. 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 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 with respect thereto shall be delivered to the Trustee. Except with respect to a Restricted Payment permitted by Section 4.07(b) above, the Board of Directors' determination must be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing if the fair market value exceeds $10.0 million. Not later than the date on which such Restricted Payment was made, the Company shall deliver to the Trustee an Officers' Certificate stating that such Restricted Payment is permitted and setting forth the basis upon which the calculations required by this Section 4.07 were computed, together with a copy of any fairness opinion or appraisal required by this Indenture. Section 4.08 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED 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 consensual restriction of any kind on the ability of any Restricted Subsidiary to: (i) pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, or 51 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; (ii) make loans or advances to the Company or any of its Restricted Subsidiaries; or (iii) transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries. (b) However, the restrictions set forth in Section 4.08(a) will not apply to encumbrances or restrictions existing under or by reason of: (i) agreements governing Existing Indebtedness and the Credit Facilities as in effect on the date hereof 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 hereof; (ii) this Indenture, the Notes and the Exchange Notes; (iii) applicable law; (iv) 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; (v) customary non-assignment provisions of any contract or agreement entered into in the ordinary course of business and customary provisions restricting subletting of any interest in real or personal property contained in any lease or easement agreement of the Company or any Restricted Subsidiary; (vi) purchase money obligations for property acquired in the ordinary course of business that impose restrictions on that property of the nature described in Section 4.08(a)(iii); (vii) any agreement for the sale or other disposition of all or substantially all of the assets or Capital Stock of a Restricted Subsidiary that restricts distributions by that Restricted Subsidiary pending its sale or other disposition of all or substantially all of the assets or Capital Stock of such Restricted Subsidiary; 52 (viii) Permitted Refinancing Indebtedness; PROVIDED that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness with respect to dividends and other payments are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced; (ix) Liens securing Indebtedness otherwise permitted to be incurred under Section 4.12 that limit the right of the debtor to dispose of the assets subject to such Liens; (x) provisions with respect to the disposition or distribution of assets or property in joint venture agreements entered into in the ordinary course of business; (xi) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business; (xii) any Indebtedness incurred in compliance with the Section 4.09 by any Foreign Subsidiary or any Guarantor, or any agreement pursuant to which such Indebtedness is issued, if the encumbrance or restriction applies only to such Foreign Subsidiary or Guarantor and only in the event of a payment default or default with respect to a financial covenant contained in the Indebtedness or agreement and the encumbrance or restriction is not materially more disadvantageous to the Holders of the Notes than is customary in comparable financings (as determined by the Board of Directors of the Company) and the Board of Directors of the Company determines that any such encumbrance or restriction will not materially affect the Company's ability to pay interest or principal on the Notes; or (xiii) an arrangement or circumstance arising or agreed to in the ordinary course of business, not relating to any Indebtedness, and that does not, individually or in the aggregate, detract from the value of property or assets of the Company or any Restricted Subsidiary in any manner material to the Company or any Restricted Subsidiary. 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 will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any Disqualified Stock or preferred stock; PROVIDED, HOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and any Guarantor may incur Indebtedness or issue Disqualified Stock (and WCC RE Holdings LLC and Atlantic Shores Healthcare, Inc. may guarantee Indebtedness of the Company under the Credit Agreement) and any Foreign Subsidiary may incur Indebtedness, 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 53 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) So long as no Default shall have occurred and be continuing or would be caused thereby, Section 4.09(a) will not prohibit the incurrence of any of the following items of Indebtedness or the issuance of Disqualified Stock, as set forth below (collectively, "PERMITTED DEBT"): (i) the incurrence by the Company and any of its Restricted Subsidiaries of Indebtedness under the Credit Agreement in an aggregate principal amount at any one time outstanding under this clause 4.09(b)(i) not to exceed $150.0 million, LESS the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to repay any Indebtedness under the Credit Agreement and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto, pursuant to Section 4.10; (ii) the incurrence by the Company and any of its Restricted Subsidiaries of Existing Indebtedness; (iii) the incurrence by the Company of Indebtedness represented by the Notes to be issued on the date hereof and any Guarantees thereof by any Guarantor; (iv) the incurrence by the Company or any Restricted Subsidiary 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 4.09(b)(iv), not to exceed $10.0 million at any time outstanding; (v) 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 (ii), (iii), (v), or (xi) of this Section 4.09(b); (vi) 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; and 54 (B) (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 4.09(b)(vi); (vii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any Indebtedness that is permitted by the terms of this Indenture to be outstanding or for hedging foreign currency exchange risk, in each case to the extent the Hedging Obligations are incurred in the ordinary course of business and not for any speculative purpose; (viii) the Guarantee by the Company or any Guarantor of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; (ix) 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, 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 Section 4.09; PROVIDED, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued; (x) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness, including Indebtedness represented by letters of credit for the account of the Company or any Restricted Subsidiary, incurred in respect of workers' compensation claims, self-insurance obligations, performance, proposal, completion, surety and similar bonds and completion guarantees provided by the Company or any of its Restricted Subsidiaries in the ordinary course of business; PROVIDED that the underlying obligation to perform is that of the Company or its Restricted Subsidiaries and not that of the Company's Unrestricted Subsidiaries; PROVIDED FURTHER that such underlying obligation is not in respect of borrowed money; (xi) the incurrence by the Company or any of the Restricted Subsidiaries of additional 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 (xi), not to exceed $30.0 million; (xii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness, including but not limited to Indebtedness represented by letters of credit for the account of the Company or any Restricted Subsidiary, arising from agreements of the Company or a 55 Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Equity Interests of the Company or a Restricted Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Equity Interests for the purpose of financing such acquisition; (xiii) the incurrence by the Company or any Restricted Subsidiary of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, PROVIDED that such Indebtedness is extinguished within five Business Days of incurrence; or (xiv) the issuance of preferred stock of a Restricted Subsidiary to the Company that is pledged to secure the Credit Agreement, PROVIDED that any subsequent transfer that results in such preferred stock being held by a Person other than the Company or a Restricted Subsidiary will be deemed to constitute an issuance of preferred stock not permitted by this clause (xiv). (c) For purposes of determining compliance with any restriction on the incurrence of Indebtedness where the Indebtedness incurred is not denominated in U.S. dollars, the amount of such Indebtedness will be the U.S. Dollar Equivalent determined on the date of incurrence of such Indebtedness; PROVIDED, HOWEVER, that if any such Indebtedness not denominated in U.S. dollars is subject to a Hedging Obligation 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 Hedging Obligation. 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 refinanced, except to the extent that (i) such U.S. Dollar Equivalent was determined based on a Hedging Obligation, in which case the Permitted Refinancing Indebtedness will be determined in accordance with the preceding sentence, and (ii) 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 will be determined on the date such Permitted Refinancing Indebtedness is Incurred. (d) 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 (i) through (xiv) of Section 4.09(b), or is entitled to be incurred pursuant to Section 4.09(a), the Company will be permitted to 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 the Credit Agreement outstanding on the date on which Notes are first issued and authenticated under this Indenture will be deemed to have been incurred on such date in reliance on the exception provided in Section 4.09(b)(i). (e) The Company shall not, and shall not permit any Guarantor, to incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Guarantor unless such Indebtedness is also contractually subordinated in 56 right of payment to the Notes or such Guarantee 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. Section 4.10 ASSET SALES. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless: (i) 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; (ii) the fair market value, in the case of any Asset Sales or series of related Asset Sales having a fair market value of $5.0 million or more, is determined by the Company's Board of Directors and evidenced by a resolution of Board of Directors set forth in an Officers' Certificate delivered to the Trustee; and (iii) at least 75% of the consideration received in the Asset Sale by the Company or such Restricted Subsidiary is in the form of cash or Cash Equivalents. For purposes of this Section 4.10(a)(iii) only, each of the following will be deemed to be cash: (A) any liabilities, as shown on the Company's or such Restricted Subsidiary's most recent balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and Indebtedness (other than Indebtedness secured by the assets sold) that is equal in right of payment with or subordinated to the Notes or any Guarantee) that are assumed by the transferee of any such assets pursuant to a customary novation 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 into cash or Cash Equivalents within 30 days after the applicable Asset Sale, to the extent of the cash or Cash Equivalents received in that conversion. (b) Within 360 days after the receipt of any Net Proceeds from an Asset Sale or from the sale of the Company's interest in Premier Custodial Group Limited to Serco Investments Limited, the Company or the applicable Restricted Subsidiary may apply those Net Proceeds, at its option: (i) to repay permanently Indebtedness under the Credit Agreement (and with respect to Net Proceeds of a Restricted Subsidiary that is not a Guarantor, Indebtedness of such Restricted Subsidiary) and, if the Indebtedness permanently repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto; 57 (ii) to acquire, or enter into a definitive agreement to acquire, all or substantially all of the assets of, a Permitted Business or a majority of the Voting Stock of a Person employed in a Permitted Business, PROVIDED that such Person becomes a Restricted Subsidiary and PROVIDED FURTHER, however, in the case of a definitive agreement, that such acquisition closes within 120 days of such 360 day period; (iii) to make a capital expenditure in or that is used or useful in a Permitted Business (provided that the completion of (a) construction of new facilities, (b) expansions to existing facilities and (c) repair or construction of damaged or destroyed facilities, in each case, which commences within such 360 days may extend for an additional 360 day period if the Net Proceeds to be used for such construction, expansion or repair are committed specifically for such activity within such 360 days); or (iv) to acquire other long-term assets that are used or useful in a Permitted Business. Pending the final application of any Net Proceeds, the Company may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by this Indenture. (c) Any Net Proceeds from Asset Sales (or from the sale of the Company's interest in Premier Custodial Group Limited to Serco Investments Limited) 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 shall make an offer (an "ASSET SALE OFFER") to all Holders of Notes and, at the Company's option, all holders of other Indebtedness that is pari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets, to purchase on a pro rata basis the maximum principal amount of Notes and such other pari passu Indebtedness 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, 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 and other pari passu Indebtedness 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. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. (d) 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 Section 4.10 by virtue of such conflict. 58 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: (i) such 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 (ii) 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 of the Company; and (B) except with respect to leases of facilities entered into in the ordinary course of business with a Wholly Owned Subsidiary, with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $10.0 million, an opinion as to the fairness to the Company of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing. (b) The following items shall be deemed not to be Affiliate Transactions and, therefore, will not be subject to the provisions of Section 4.11(a): (i) indemnity agreements and reasonable employment arrangements (including severance and retirement agreements) entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business of the Company or such Restricted Subsidiary, in each case approved by the disinterested members of the Board of Directors of the Company; (ii) transactions between or among the Company and/or its Restricted Subsidiaries; (iii) payment of reasonable directors fees to Persons who are not otherwise Affiliates of the Company; (iv) sales of Equity Interests (other than Disqualified Stock) of the Company; (v) Restricted Payments that are permitted by Section 4.07; and 59 (vi) any issuance of securities, or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of employment arrangements, stock options and stock ownership plans and other reasonable fees, compensation, benefits and indemnities paid or entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business to or with officers, directors or employees of the Company and its Restricted Subsidiaries. Section 4.12 LIENS. The Company shall not and shall not permit any of its Restricted Subsidiaries to, create, incur, assume or otherwise cause or suffer to exist or become effective any Lien of any kind (other than Permitted Liens) upon any of their property or assets, now owned or hereafter acquired, unless all payments due under this Indenture and the Notes are secured on an equal and ratable basis with the Obligations so secured until such time as such Obligations are no longer secured by a Lien. Section 4.13 BUSINESS ACTIVITIES. The Company shall not, and shall not permit any Restricted Subsidiary to, engage in any business other than Permitted Businesses, except to such extent as would not be material to the Company and its Restricted Subsidiaries takes as a whole. Section 4.14 OFFER TO REPURCHASE UPON A CHANGE OF CONTROL. (a) Upon the occurrence of a Change of Control, each Holder of Notes shall have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple thereof) of such Holder's Notes pursuant to the offer described below (the "CHANGE OF CONTROL OFFER") at an offer price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the date of purchase (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 offering to repurchase Notes on the 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 described in Section 3.08 and described in such notice. 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 such Change of Control Offer, the Company shall comply with the applicable securities laws and regulations and shall be deemed not to have breached its obligations under Section 4.14 by virtue of such conflict. (b) On the Change of Control Payment Date, the Company shall, to the extent lawful, (1) accept for payment all Notes or portions thereof 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 thereof so properly tendered and (3) deliver or cause to be 60 delivered to the Trustee the Notes properly accepted together with an Officers' Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company. The Paying Agent shall promptly deliver 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 each such new Note shall be in a principal amount of $1,000 or an integral multiple thereof. 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 4.14, the Company shall not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 4.14 and all other provisions of this Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes properly tendered and not withdrawn under such Change of Control Offer. Section 4.15 LIMITATION ON ISSUANCES AND SALES OF EQUITY INTERESTS IN RESTRICTED SUBSIDIARIES. The Company shall not transfer, convey, sell, assign, lease or otherwise dispose of, and shall not permit any of its Restricted Subsidiaries to, issue, transfer, convey, sell, assign, lease or otherwise dispose of any Equity Interests in any Restricted Subsidiary of the Company to any Person (other than the Company or a Wholly Owned Restricted Subsidiary of the Company), except: (1) if, immediately after giving effect to such issuance, transfer, conveyance, sale, assignment, lease or other disposition, such Restricted Subsidiary would no longer constitute a Restricted Subsidiary and any Investment in such Person remaining after giving effect to such issuance or sale would have been permitted to be made under Section 4.07, if made on the date of such issuance or sale; or (2) sales of common stock of a Restricted Subsidiary by the Company or a Restricted Subsidiary, PROVIDED that the Company or such Restricted Subsidiary complies with Section 4.10. Section 4.16 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 or Event of Default. 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 shall be deemed to be Investments made as of the time of the designation, subject to the limitations on Restricted Payments. 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 of the Company may redesignate 61 any Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would not cause a Default; PROVIDED that such designation shall 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 shall only be permitted if (1) such Indebtedness is permitted under Section 4.09, 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 or Event of Default would be in existence following such designation. 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 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 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: (i) 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 the Fixed Charge Coverage Ratio test in Section 4.09(a) hereof and (b) incurred a Lien to secure such Indebtedness pursuant to Section 4.12; (ii) 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 of the Company and set forth in an Officers' Certificate delivered to the Trustee, of the property that is the subject of that Sale and Leaseback Transaction; and (iii) the transfer of assets in that Sale and Leaseback Transaction is permitted by, and the Company applies the proceeds of such transaction in compliance with Section 4.10 hereof. Section 4.19 ADDITIONAL NOTE GUARANTEES. The Company shall not permit any of its Restricted Subsidiaries which are not Guarantors (other than Guarantees by WCC RE Holdings LLC and Atlantic Shores Healthcare, Inc. of Indebtedness incurred under the Credit Agreement), directly or indirectly, to Guarantee the payment of any Indebtedness of the Company or any Guarantor unless such Restricted Subsidiary simultaneously executes and delivers (i) a supplemental indenture, in the form of Exhibit F attached hereto, providing for the Guarantee of the payment of the Notes by such Restricted Subsidiary, which Guarantee shall be senior to or PARI PASSU with such Subsidiary's Guarantee of such other Indebtedness and (ii) a notation of Guarantee in the form of Exhibit E attached hereto. 62 ARTICLE FIVE SUCCESSORS Section 5.01 MERGER, CONSOLIDATION OR SALE OF ASSETS. (a) The Company shall not, in a single transaction or a series of related transactions, consolidate with or merge with or into any other Person or sell, assign, convey, transfer, lease or otherwise dispose of all or substantially all of its properties and assets to any Person or group of affiliated Persons, or permit any of its Restricted Subsidiaries to enter into any such transaction or transactions if such transaction or transactions, in the aggregate, would result in an assignment, conveyance, transfer, lease or disposition of all or substantially all of the properties and assets of the Company and its Restricted Subsidiaries taken as a whole to any other Person or group of affiliated Persons, unless at the time and after giving effect thereto: (i) 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, lease, transfer, conveyance or other disposition has been made is a corporation organized or existing under the laws of the United States, any state of the United States or the District of Columbia; (ii) the Person formed by or surviving any such consolidation or merger (if other than the Company) or the Person to which such sale, assignment, lease, transfer, conveyance or other disposition has been made assumes all the obligations of the Company under the Notes, this Indenture and the Registration Rights Agreement pursuant to agreements reasonably satisfactory to the Trustee; (iii) no Default or Event of Default exists; (iv) the Company or the other Person formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, assignment, lease, transfer, conveyance or other disposition has been made will, 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, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.09(a) hereof; and (v) the Company or the other Person formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, assignment, lease, transfer, conveyance or other disposition has been made will have delivered to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, merger, sale, assignment, lease, conveyance, transfer, or other disposition, and if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with the requirements of this Indenture and that all conditions precedent therein provided for relating to such transaction have been complied with. (b) Clause (iv) of this Section 5.01 will not apply to: (a) a sale, transfer or other disposition of assets between or among the Company and 63 any of its Wholly Owned Restricted Subsidiaries or (b) any merger or consolidation of a Wholly Owned Restricted Subsidiary into the Company. ARTICLE SIX DEFAULTS AND REMEDIES Section 6.01 EVENTS OF DEFAULT. (a) Each of the following is an "EVENT OF DEFAULT": (i) default for 30 days in the payment when due of interest on, or Liquidated Damages with respect to, the Notes; (ii) default in payment when due of the principal of, or premium, if any, on the Notes; (iii) failure by the Company or any of its Restricted Subsidiaries, to comply with the provisions described in Sections 4.10, 4.14 or 5.01 hereof; (iv) failure by the Company or any Guarantor for 60 consecutive days after notice to comply with any of the other agreements in this Indenture; (v) 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 hereof, if that default: (A) is caused by a failure to make any payment when due at the final maturity of such Indebtedness (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 $7.5 million or more; (vi) failure by the Company or any of its Restricted Subsidiaries to pay final judgments aggregating in excess of $7.5 million, which judgments are not paid, discharged or stayed for a period of 60 days; (vii) except as permitted by this 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 or any Guarantor, or any Person acting on behalf of any Guarantor, shall deny or disaffirm its obligations under its Guarantee; 64 (viii) the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, pursuant to or within the meaning of Bankruptcy Law: (1) commences a voluntary case, (2) consents to the entry of an order for relief against it in an involuntary case, (3) makes a general assignment for the benefit of its creditors, or (4) generally is not paying its debts as they become due; and (ix) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, in an involuntary case; or (B) appoints a custodian of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary or for all or substantially all of the property of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that taken together, would constitute a Significant Subsidiary, or (C) orders the liquidation of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary. Section 6.02 ACCELERATION. (a) In the case of an Event of Default specified in clause (viii) or (ix) of Section 6.01 hereof, with respect to the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant 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 principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately by notice in writing to the Company specifying the Event of Default. (b) In the event of a declaration of acceleration of the Notes because an Event of Default has occurred and is continuing as a result of the acceleration of any Indebtedness described in clause (v) of Section 6.01(a) hereof, the declaration of acceleration of the Notes shall be automatically annulled if the holders of any Indebtedness described in clause (v) of Section 6.01(a) hereof have rescinded the declaration of acceleration in respect of the Indebtedness within 30 days of the date of the declaration and if: 65 (i) the annulment of the acceleration of Notes would not conflict with any judgment or decree of a court of competent jurisdiction; and (ii) all existing Events of Default, except nonpayment of principal or interest on the Notes that became due solely because of the acceleration of the Notes, have been cured or waived. Section 6.03 OTHER REMEDIES. (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, interest, and Liquidated Damages, if any, with respect to, the Notes or to enforce the performance of any provision of the Notes or this Indenture. (b) 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 a majority in principal amount of the then outstanding Notes by notice to the Trustee, may on behalf of the Holders of all of the Notes, waive any existing Default or Event of Default and its consequences hereunder, except a continuing Default or Event of Default in the payment of interest or Liquidated Damages, if any, on, or the principal of, the Notes (including in connection with an offer to purchase) (PROVIDED, HOWEVER, that the Holders of a majority in principal amount of the then outstanding Notes may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration). The Company shall deliver to the Trustee an Officers' Certificate stating that the requisite percentage of Holders have consented to such waiver and attaching copies of such consents. In case of any such waiver, the Company, the Trustee and the Holders shall be restored to their former positions and rights hereunder and under the Notes, respectively. This Section 6.04 shall be in lieu of Section 316(a)(1)(B) of the TIA and such Section 316(a)(1)(B) of the TIA is hereby expressly excluded from this Indenture and the Notes, as permitted by the TIA. 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 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 and the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.. 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. 66 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 Liquidated Damages, if any) if it determines that withholding notice is in their interest. Section 6.06 LIMITATION ON SUITS. (a) A Holder may pursue a remedy with respect to this Indenture, or the Notes only if: (i) the Holder gives to the Trustee written notice of a continuing Event of Default; (ii) the Holders of at least 25% in principal amount of the then outstanding Notes make a written request to the Trustee to pursue the remedy; (iii) such Holder of a Note or Holders of Notes offer and, if requested, provide to the Trustee security and indemnity satisfactory to the Trustee against any loss, liability or expense that might be incurred by it in connection with the request or direction; (iv) the Trustee does not comply with the request within 60 days after receipt of the request and the offer and, if requested, the provision of indemnity; and (v) during such 60-day period the Holders of a majority in principal amount of the then outstanding Notes do not give the Trustee a direction inconsistent with the request. (b) 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, if any, interest on, and Liquidated Damages, if any, with respect to, 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. Section 6.08 COLLECTION SUIT BY TRUSTEE. If an Event of Default specified in Section 6.01(a)(i) or (a)(ii) 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, if any, interest, and Liquidated Damages, if any, remaining unpaid on the Notes and interest on overdue principal and premium, if any, and, to the extent lawful, interest and Liquidated Damages, if any, 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. 67 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 Guarantor (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 securities or 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 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. (a) If the Trustee collects any money pursuant to this Article, 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, expense 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, if any, interest and Liquidated Damages, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, interest, and Liquidated Damages, if any, respectively; and Third: to the Company or to such party as a court of competent jurisdiction shall direct. (b) The Trustee may fix a record date and payment date for any payment to Holders of Notes pursuant to this Section 6.10. 68 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 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 ten percent in principal amount of the then outstanding Notes. ARTICLE SEVEN TRUSTEE Section 7.01 DUTIES OF TRUSTEE. (a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in 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: (i) the duties of the Trustee shall 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 Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture. (c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (i) this paragraph does not limit the effect of paragraph (b) of this Section; (ii) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and (iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 hereof. 69 (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 shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee shall be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, costs, liability or expense that might be incurred by it in connection with the request or direction. (f) Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. Section 7.02 CERTAIN RIGHTS OF TRUSTEE. (a) The Trustee may conclusively rely upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document. (b) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon. (c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. (d) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Indenture. (e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer of the Company. (f) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction. (g) The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of such event is sent to the Trustee in accordance with Section 11.02 hereof, and such notice references the Notes. 70 (h) the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each officer, director and employee of the Trustee. (i) the Trustee may request that the Company deliver an Officers' Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers' Certificate may be signed by any person authorized to sign an Officers' Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. 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 become a creditor of, or otherwise deal with, the Company or any of its Affiliates with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest as described in the Trust Indenture Act of 1939, it must eliminate such conflict within 90 days, apply to the SEC for permission to continue as trustee or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof. Section 7.04 TRUSTEE'S DISCLAIMER. The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture, it shall not be accountable for the Company's use of the proceeds from the Notes or any money paid to the Company or upon the Company's direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than 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 shall 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 and 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 1 beginning with the May 1 following the date hereof, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders of the Notes a brief report dated as of such reporting date that complies with TIA ss. 313(a) (but if no event described in TIA ss. 313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA ss. 313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA ss. 313(c). 71 (b) A copy of each report at the time of its mailing to the Holders of Notes shall be mailed to the Company and filed with the SEC and each stock exchange on which the Notes are listed in accordance with TIA ss. 313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange or any delisting thereof. Section 7.07 COMPENSATION AND INDEMNITY. (a) The Company shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder in accordance with a written schedule provided by the Trustee to the Company. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee's agents and counsel. (b) The Company shall 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 reasonable costs and expenses of enforcing this Indenture against the Company (including this Section 7.07) and defending itself against any claim (whether asserted by either of the Company or 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 willful misconduct. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. (c) The obligations of the Company under this Section 7.07 shall survive the satisfaction and discharge of this Indenture and resignation of removal of the Trustee. (d) To secure the Company's payment obligations in this Section, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture and resignation or removal of the Trustee. (e) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(a)(viii) and (ix) 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 shall comply with the provisions of TIAss.313(b)(2) to the extent applicable. 72 Section 7.08 REPLACEMENT OF TRUSTEE. (a) A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee's acceptance of appointment as provided in this Section 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 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 if: (i) the Trustee fails to comply with Section 7.10 hereof; (ii) 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; (iii) a custodian or public officer takes charge of the Trustee or its property; or (iv) 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 shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the 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 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of Notes of at least 10% in principal amount of the then outstanding Notes may petition at the expense of the Company 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, 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 shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, PROVIDED all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 7.08 or Section 7.09, the Company's obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee. 73 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 Person, the successor Person without any further act shall be the successor Trustee. Section 7.10 ELIGIBILITY; DISQUALIFICATION. There shall at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of the United States of America or of any state thereof 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 shall always have a Trustee who satisfies the requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA ss. 310(b). Section 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The Trustee is subject to TIA ss. 311(a), excluding any creditor relationship listed in TIA ss. 311(b). A Trustee who has resigned or been removed shall be subject to TIA ss. 311(a) to the extent indicated therein. The Trustee hereby waives any right to set-off any claim that it may have against the Company in any capacity (other than as Trustee and Paying Agent) against any of the assets of the Company held by the Trustee; PROVIDED, HOWEVER, that if the Trustee is or becomes a lender of any other Indebtedness permitted hereunder to be PARI PASSU with the Notes, then such waiver shall not apply to the extent of such Indebtedness. Section 7.12 TRUSTEE'S APPLICATION FOR INSTRUCTIONS FROM THE COMPANY. Any application by the Trustee for written instructions from the Company may, at the option of the Trustee, set forth in writing any action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or after which such action shall be taken or such omission shall be effective. The Trustee shall not be liable for any action taken by, or omission of, the Trustee in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than five (5) Business Days after the date any Officer of the Company actually receives such application, unless any such Officer shall have consented in writing to any earlier date) unless prior to taking any such action (or the effective date in the case of an omission), the Trustee shall have received written instructions in response to such application specifying the action to be taken or omitted. ARTICLE EIGHT DEFEASANCE AND COVENANT DEFEASANCE Section 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE. The Company may, at the option of the Board of Directors evidenced by a resolution set forth in an Officers' Certificate, at any time, 74 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 Eight. 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 shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from its obligations with respect to all outstanding Notes and all obligations of the Guarantors shall be deemed to have been discharged with respect to their obligations under the 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 shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes and Guarantees, respectively, which shall 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 (a) and (b) below, and to have satisfied all its other obligations under such Notes and this Indenture (and the Trustee, on reasonable demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described in Section 8.04 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, interest and Liquidated Damages, if any, on such Notes when such payments are due, (b) the Company's obligations with respect to such Notes under Article 2 concerning issuing temporary Notes, registration of Notes and mutilated, destroyed, lost or stolen Notes and Company's obligations under Section 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company's obligations in connection therewith and (d) 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 shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from its obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18 and 4.19 hereof and clause (iv) of Section 5.01(a) hereof with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.04 are satisfied (hereinafter, "COVENANT DEFEASANCE"), and the Notes shall thereafter be deemed not "outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or 75 by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. In addition, upon the Company's exercise under Section 8.01 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(a)(iii) through (vii) shall not constitute Events of Default. Section 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE. (a) The following shall be the conditions to the application of either Section 8.02 or 8.03 hereof to the outstanding Notes: (i) 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 and, if the Notes are being defeased to a particular redemption date, the Company must have delivered to the Trustee an irrevocable notice of redemption; (ii) in the case of Legal Defeasance, the Company shall have 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 hereof, 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; (iii) in the case of Covenant Defeasance, the Company shall have 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; (iv) no Default or Event of Default has occurred and is continuing either (a) on the date of such deposit or (b) insofar as Events of Default from bankruptcy or insolvency events are concerned, at any time in the period ending on the 123rd day after the date of deposit; (v) 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; 76 (vi) the Company must have delivered 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 or with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; (vii) the Company must have delivered to the Trustee an Opinion of Counsel to the effect that the creation of the defeasance trust does not violate the Investment Company Act of 1940 and after the passage of 123 days following the deposit, the trust fund will not be subject to the effect of Section 547 of the U.S. Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law; and (viii) 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. (a) Subject to Section 8.06 hereof, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee pursuant to Section 8.04 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (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. (b) The Company shall 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. (c) Anything in this Article Eight to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any money or 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(a) 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 THE 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, if any, or interest on any Note and remaining unclaimed for two years after such principal, and premium, 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) shall be discharged from such trust; and the Holder of such Note shall thereafter look 77 only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as Trustee thereof, shall thereupon cease; PROVIDED, 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 date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining shall be repaid to the Company. Section 8.07 REINSTATEMENT. If the Trustee or Paying Agent is unable to apply any United States 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 obligations under this Indenture and the Notes shall 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, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying Agent. ARTICLE NINE AMENDMENT, SUPPLEMENT AND WAIVER Section 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES. (a) Notwithstanding Section 9.02 of this Indenture, the Company, the Guarantors, if any, and the Trustee may amend or supplement this Indenture or the Notes without the consent of any Holder of a Note: (i) to cure any ambiguity, defect or inconsistency; (ii) to provide for uncertificated Notes in addition to or in place of certificated Notes; (iii) 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 or such Guarantor's assets; (iv) 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; (v) to comply with requirements of the SEC in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act; or 78 (vi) to allow any Subsidiary to guarantee the Notes. (b) 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 shall join with the Company in the execution of any amended or supplemental indenture authorized or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into such amended or supplemental indenture that affects its own rights, duties or immunities under this Indenture or otherwise. Section 9.02 WITH CONSENT OF HOLDERS OF NOTES. (a) Except as provided in Section 9.02(c), the Company, the Guarantors, if any, and the Trustee may amend or supplement this Indenture or the Notes with the consent of the Holders of at least a majority in principal amount of the Notes (including Additional Notes, if any) then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default or compliance with any provision of this Indenture or the Notes may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes (including Additional Notes, if any) (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes). (b) The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to consent to any indenture supplemental hereto. If a record date is fixed, the Holders on such record date, or its duly designated proxies, and only such Persons, shall be entitled to consent to such supplemental indenture, whether or not such Holders remain Holders after such record date; PROVIDED that unless such consent shall have become effective by virtue of the requisite percentage having been obtained prior to the date which is 90 days after such record date, any such consent previously given shall automatically and without further action by any Holder be cancelled and of no further effect. (c) 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 shall join with the Company 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 this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such amended or supplemental indenture. (d) It shall 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 or waiver, but it shall be sufficient if such consent approves the substance thereof. 79 (e) After an amendment, supplement or waiver under this Section becomes effective, the Company shall mail to the Holders of Notes affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a majority in aggregate principal amount of the then outstanding Notes (including Additional Notes, if any) may waive compliance in a particular instance by the Company with any provision of this Indenture, or the Notes. However, without the consent of each Holder affected, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder): (i) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver; (ii) reduce the principal of or change the fixed maturity of any Note or alter the provisions, or waive any payment, with respect to the redemption of the Notes; (iii) reduce the rate of or change the time for payment of interest on any Note; (iv) waive a Default or Event of 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); (v) make any Note payable in money other than U.S. dollars; (vi) 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; (vii) waive a redemption payment with respect to any Note; (viii) release any Guarantor from any of its obligations under its Guarantee or this Indenture, except in accordance with the terms of this Indenture; (ix) impair the right to institute suit for the enforcement of any payment on or with respect to the Notes or the Guarantees; (x) amend, change or modify the obligation of the Company to make and consummate an Asset Sale Offer with respect to any Asset Sale in accordance with Section 4.10 hereof after the obligation to make an Asset Sale Offer has arisen or the obligation of the Company to make and consummate a Change of Control Offer in the event of a Change of Control in accordance with Section 4.14 hereof after a Change of Control has occurred, including, in each case, amending, changing or modifying any definition relating thereto; (xi) make any change in the preceding amendment and waiver provisions. 80 Section 9.03 COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or supplemental indenture that complies with the TIA as then in effect. Section 9.04 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 waiver, supplement or amendment 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. (a) 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. (b) Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver. Section 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC. The Trustee shall sign any amended or supplemental indenture or Note authorized pursuant to this Article Nine if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Company may not sign an amendment or supplemental indenture or Note until its Board of Directors approves it. In executing any amended or supplemental indenture or Note, the Trustee shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully protected in relying upon 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 and that all conditions precedent to such execution have been met. ARTICLE TEN SATISFACTION AND DISCHARGE Section 10.01 SATISFACTION AND DISCHARGE. (a) This Indenture shall be discharged and shall cease to be of further effect as to all Notes issued thereunder, when: (i) either: 81 (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 theretofore 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 making 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 thereof, in such 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; (ii) no Default or Event of Default shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such 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; (iii) the Company or any Guarantor has paid or caused to be paid all sums payable by it hereunder; and (iv) the Company has delivered irrevocable instructions to the Trustee hereunder to apply the deposited money toward the payment of the Notes at maturity or the redemption date, as the case may be. (b) 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. Section 10.02 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS. Subject to Section 10.03 hereof, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee pursuant to Section 10.01 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (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 be segregated from other funds except to the extent required by law. 82 Section 10.03 REPAYMENT TO THE 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 and Liquidated Damages, if any, or interest on any Note and remaining unclaimed for two years after such principal, and premium, 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) shall be discharged from such trust; and the Holder of such Note shall thereafter look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as Trustee thereof, shall thereupon cease; PROVIDED, 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 or The Wall Street Journal (national edition), notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining shall be repaid to the Company. ARTICLE ELEVEN MISCELLANEOUS Section 11.01 TRUST INDENTURE ACT CONTROLS. If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA ss. 318(c), the imposed duties shall control. Section 11.02 NOTICES. (a) Any notice or communication by the Company or any Guarantor, on the one hand, or the Trustee on the other hand, to the other is duly given if in writing and delivered in Person or mailed by first class mail (registered or certified, return receipt requested), telecopier or overnight air courier guaranteeing next day delivery, to the others' address: If to the Company: Wackenhut Corrections Corporation One Park Place 621 NW 53rd Street Suite 700 Boca Raton, Florida 33487 Facsimile: (561) 999-7742 Attention: John G. O'Rourke 83 With a copy to: Akerman Senterfitt One Southeast Third Avenue 28th Floor Miami, Florida 33131-1714 Facsimile: (305) 374-5095 Attention: Stephen K. Roddenberry If to the Trustee: The Bank of New York 101 Barclay Street, 8W New York, New York 10286 Facsimile: (212) 815-5704 Attention: Corporate Finance Unit, Ref: Wackenhut Corrections Corp. (b) The Company the Guarantors if any, or the Trustee, by notice to the others may designate additional or different addresses for subsequent notices or communications. (c) All notices and communications (other than those sent to Holders) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. (d) Any notice or communication to a Holder shall 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 shall also be so mailed to any Person described in TIA ss. 313(c), to the extent required by the TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. (e) 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. Notwithstanding the foregoing, notices to the Trustee shall be deemed to be effective only when actually received by the Trustee's Corporate Trust Department. (f) If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time. Section 11.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES. Holders may communicate pursuant to TIA ss. 312(b) with other Holders with respect to its rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA ss. 312(c). 84 Section 11.04 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: (i) an Officers' Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 11.05 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 (ii) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 11.05 hereof) stating that, in the opinion of such counsel (who may rely upon the Officer's Certificate as to matters of fact), all such conditions precedent and covenants have been satisfied. Section 11.05 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 ss. 314(a)(4)) shall comply with the provisions of TIA ss. 314(e) and shall include: (i) a statement that the Person making such certificate or opinion has read such covenant or condition; (ii) 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; (iii) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been satisfied; and (iv) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied. Section 11.06 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 11.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS. No director, officer, employee, incorporator or stockholder of the Company or any Guarantor, as such, shall have any liability for any obligations of the Company or the Guarantors under the Notes, this Indenture, the Note Guarantees 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 85 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. Section 11.08 GOVERNING LAW. THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Section 11.09 CONSENT TO JURISDICTION. Any legal suit, action or proceeding arising out of or based upon this Indenture or the transactions contemplated hereby ("RELATED PROCEEDINGS") may be instituted in the federal courts of the United States of America located in the City of New York or the courts of the State of New York in each case located in the City of New York (collectively, the "SPECIFIED COURTS"), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such court (a "RELATED JUDGMENT"), as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice or document by mail to such party's (other than the Trustee) address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court has been brought in an inconvenient forum. Section 11.10 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 any of its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. Section 11.11 SUCCESSORS. All agreements of the Company in this Indenture and the Notes shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors. All agreements of each Guarantor in this Indenture shall bind its successors. Section 11.12 SEVERABILITY. In case any provision in this Indenture or the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 11.13 COUNTERPART ORIGINALS. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 86 Section 11.14 ACTS OF HOLDERS. (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by the Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agents duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "ACT" of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Trustee and the Company if made in the manner provided in this Section 11.14. (b) The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to such witness, notary or officer the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient. (c) Notwithstanding anything to the contrary contained in this Section 11.14, the principal amount and serial numbers of Notes held by any Holder, and the date of holding the same, shall be proved by the register of the Notes maintained by the Registrar as provided in Section 2.04 hereof. (d) If the Company shall solicit from the Holders of the Notes any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a resolution of its Board of Directors, fix in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company shall have no obligation to do so. Notwithstanding TIA ss. 316(c), such record date shall be the record date specified in or pursuant to such resolution, which shall be a date not earlier than the date 30 days prior to the first solicitation of Holders generally in connection therewith or the date of the most recent list of Holders forwarded to the Trustee prior to such solicitation pursuant to Section 2.06 hereof and not later than the date such solicitation is completed. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of the then outstanding Notes have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the then outstanding Notes shall be computed as of such record date; PROVIDED that no such authorization, agreement or consent 87 by the Holders on such record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than 90 days after the record date. (e) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Note shall bind every future Holder of the same Note and the Holder of every Note issued upon the registration or transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Note. (f) Without limiting the foregoing, a Holder entitled hereunder to take any action hereunder with regard to any particular Note may do so itself with regard to all or any part of the principal amount of such Note or by one or more duly appointed agents each of which may do so pursuant to such appointment with regard to all or any part of such principal amount. Section 11.15 BENEFIT OF INDENTURE. Nothing, in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto, any Paying Agent, any Registrar and its successors hereunder, and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. Section 11.16 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 shall in no way modify or restrict any of the terms or provisions hereof. Section 11.17 WAIVER OF JURY TRIAL. EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 88 SIGNATURES WACKENHUT CORRECTIONS CORPORATION By: /s/ John G. O'Rourke ------------------------------ Name: John G. O'Rourke Title: Chief Financial Officer- Senior Vice President 89 THE BANK OF NEW YORK, as Trustee By: /s/ Mary LaGumina ------------------------------ Name: Mary LaGumina Title: Vice President 90 [EXHIBIT OMITTED] EX-4.2 5 g84060exv4w2.txt EX-4.2 REGISTRATION RIGHTS AGREEMENT EXHIBIT 4.2 REGISTRATION RIGHTS AGREEMENT BY AND AMONG WACKENHUT CORRECTIONS CORPORATION AND BNP PARIBAS SECURITIES CORP. LEHMAN BROTHERS INC. FIRST ANALYSIS SECURITIES CORPORATION SOUTHTRUST SECURITIES, INC. COMERICA SECURITIES, INC. DATED AS OF JULY 9, 2003 REGISTRATION RIGHTS AGREEMENT This Registration Rights Agreement (this "AGREEMENT") is made and entered into as of July 9, 2003, by and among Wackenhut Corrections Corporation, a Florida corporation (the "COMPANY"), and the Initial Purchasers set forth in Schedule I to the Purchase Agreement (as defined below) (each an "INITIAL PURCHASER" and, collectively, the "INITIAL PURCHASERS"), each of whom has agreed to purchase the Company's 8 1/4% Senior Notes due 2013 (the "INITIAL NOTES") pursuant to the Purchase Agreement (as defined below). This Agreement is made pursuant to the Purchase Agreement, dated as of July 1, 2003 (the "PURCHASE AGREEMENT"), by and among the Company and the Initial Purchasers (i) for the benefit of the Initial Purchasers and (ii) for the benefit of the holders from time to time of the Initial Notes (including you and each other Initial Purchaser named in the Purchase Agreement). In order to induce the Initial Purchasers to purchase the Initial Notes, the Company has agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the obligations of the Initial Purchasers set forth in Section 3(a) of the Purchase Agreement. The parties hereby agree as follows: SECTION 1. DEFINITIONS As used in this Agreement, the following capitalized terms shall have the following meanings: ADVICE: As defined in Section 6(c) hereof. BROKER-DEALER: Any broker or dealer registered under the Exchange Act. CLOSING DATE: The date of this Agreement. COMMISSION: The Securities and Exchange Commission. CONSUMMATE: A registered Exchange Offer shall be deemed "Consummated" for purposes of this Agreement upon the occurrence of all of the following (i) the filing and effectiveness under the Securities Act of the Exchange Offer Registration Statement relating to the Exchange Notes to be issued in the Exchange Offer, (ii) the maintenance of such Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company to the Registrar under the Indenture of Exchange Notes in the same aggregate principal amount as the aggregate principal amount of Initial Notes that were tendered by Holders thereof pursuant to the Exchange Offer. EFFECTIVENESS TARGET DATE: As defined in Section 5 hereof. EXCHANGE ACT: The Securities Exchange Act of 1934, as amended. 1 EXCHANGE NOTES: The 8 1/4% Senior Notes due 2013, of the same series under the Indenture as tHE Initial Notes, to be issued to Holders in exchange for Transfer Restricted Notes pursuant to this Agreement. EXCHANGE OFFER: The registration by the Company under the Securities Act of the Exchange Notes pursuant to a Registration Statement pursuant to which the Company offers the Holders of all outstanding Transfer Restricted Notes the opportunity to exchange all such outstanding Transfer Restricted Notes held by such Holders for Exchange Notes in an aggregate principal amount equal to the aggregate principal amount of the Transfer Restricted Notes tendered in such exchange offer by such Holders. EXCHANGE OFFER REGISTRATION STATEMENT: The Registration Statement relating to the Exchange Offer, including the related Prospectus. GUARANTOR: Each Person that becomes a Guarantor of the Notes in accordance with the terms of the Indenture. HOLDERS: As defined in Section 2(b) hereof. INDEMNIFIED HOLDER: As defined in Section 8(a) hereof. INDENTURE: The Indenture, dated as of July 9, 2003, between the Company and The Bank of New York, as trustee (the "TRUSTEE"), pursuant to which the Notes are to be issued, as such Indenture is amended or supplemented from time to time in accordance with the terms thereof. INITIAL NOTES: The 8 1/4% Senior Notes due 2013, of the same series under the Indenture as the Exchange Notes, for so long as such securities constitute Transfer Restricted Notes. INITIAL PLACEMENT: The issuance and sale by the Company of the Initial Notes to the Initial Purchasers pursuant to the Purchase Agreement. INITIAL PURCHASERS: As defined in the preamble hereto. INTEREST PAYMENT DATE: As defined in the Indenture and the Notes. LIQUIDATED DAMAGES: As defined in Section 5 hereof. NASD: The National Association of Securities Dealers, Inc. NOTES: The Initial Notes and the Exchange Notes. PERSON: An individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof. 2 PROSPECTUS: The prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus. REGISTRATION DEFAULT: As defined in Section 5 hereof. REGISTRATION STATEMENT: Any registration statement of the Company relating to (a) an offering of Exchange Notes pursuant to an Exchange Offer or (b) the registration for resale of Transfer Restricted Notes pursuant to the Shelf Registration Statement, which is filed pursuant to the provisions of this Agreement, in each case, including the Prospectus included therein, all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein. SECURITIES ACT: The Securities Act of 1933, as amended. SHELF FILING DEADLINE: As defined in Section 4 hereof. SHELF REGISTRATION STATEMENT: As defined in Section 4 hereof. TRANSFER RESTRICTED NOTE: Each Note, until the earliest to occur of (a) the date on which such Note is exchanged in the Exchange Offer and entitled to be resold to the public by the Holder thereof without complying with the prospectus delivery requirements of the Securities Act, (b) the date on which such Note has been effectively registered under the Securities Act and disposed of in accordance with a Shelf Registration Statement and (c) the date on which such Note is distributed to the public pursuant to Rule 144 under the Securities Act or by a Broker-Dealer pursuant to the "Plan of Distribution" contemplated by the Exchange Offer Registration Statement (including delivery of the Prospectus contained therein). TRUST INDENTURE ACT: The Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa to 77bbbb) as in effect on the date of the Indenture. UNDERWRITTEN REGISTRATION or UNDERWRITTEN OFFERING: A registration in which securities of the Company are sold to an underwriter for reoffering to the public. SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT (a) TRANSFER RESTRICTED NOTES. The notes entitled to the benefits of this Agreement are the Transfer Restricted Notes. (b) HOLDERS OF TRANSFER RESTRICTED NOTES. A Person is deemed to be a holder of Transfer Restricted Notes (each, a "HOLDER") whenever such Person owns Transfer Restricted Notes. 3 SECTION 3. REGISTERED EXCHANGE OFFER (a) Unless the Exchange Offer shall not be permissible under applicable law or Commission policy (after the procedures set forth in Section 6(a) below have been complied with), the Company shall (i) cause to be filed with the Commission as soon as practicable after the Closing Date, but in no event later than 75 days after the Closing Date, a Registration Statement under the Securities Act relating to the Exchange Notes and the Exchange Offer, (ii) use its best efforts to cause such Registration Statement to become effective at the earliest possible time, but in no event later than 180 days after the Closing Date, (iii) in connection with the foregoing, file (A) all pre-effective amendments to such Registration Statement as may be necessary in order to cause such Registration Statement to become effective and (B) if applicable, a post-effective amendment to such Registration Statement pursuant to Rule 430A under the Securities Act, (iv) cause all necessary filings in connection with the registration and qualification of the Exchange Notes to be made under the Blue Sky laws of such jurisdictions as are necessary to permit Consummation of the Exchange Offer, and (v) upon the effectiveness of such Registration Statement, commence the Exchange Offer. The Exchange Offer Registration Statement shall be on the appropriate form permitting registration of the Exchange Notes to be offered in exchange for the Transfer Restricted Notes and to permit resales of Notes held by Broker-Dealers as contemplated by Section 3(c) below. (b) The Company shall cause the Exchange Offer Registration Statement to be effective continuously and shall keep the Exchange Offer open for a period of not less than the minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; PROVIDED, HOWEVER, that in no event shall such period be less than 20 business days after the date notice of the Exchange Offer is mailed to the Holders. The Company shall cause the Exchange Offer to comply with all applicable federal and state securities laws. No securities other than the Notes shall be included in the Exchange Offer Registration Statement. The Company shall use its best efforts to cause the Exchange Offer to be Consummated on the earliest practicable date after the Exchange Offer Registration Statement has become effective, but in no event later than 30 days after the Exchange Offer Registration Statement has become effective. (c) The Company shall indicate in a "Plan of Distribution" section contained in the Prospectus forming a part of the Exchange Offer Registration Statement that any Broker-Dealer who holds Initial Notes that are Transfer Restricted Notes and that were acquired for its own account as a result of market-making activities or other trading activities (other than Transfer Restricted Notes acquired directly from the Company), may exchange such Initial Notes pursuant to the Exchange Offer; however, such Broker-Dealer may be deemed to be an "underwriter" within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the Exchange Notes received by such Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may be satisfied by the delivery by such Broker-Dealer of the Prospectus contained in the Exchange Offer Registration Statement. Such "Plan of Distribution" section shall also contain all other information with respect to such resales by Broker-Dealers that the Commission may require in order to permit such resales 4 pursuant thereto, but such "Plan of Distribution" shall not name any such Broker-Dealer or disclose the amount of Notes held by any such Broker-Dealer except to the extent required by the Commission as a result of a change in policy after the date of this Agreement. The Company shall use its best efforts to keep the Exchange Offer Registration Statement continuously effective, supplemented and amended as required by the provisions of Section 6(c) below to the extent necessary to ensure that it is available for resales of Notes acquired by Broker-Dealers for their own accounts as a result of market-making activities or other trading activities, and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period ending on the earlier of (i) 180 days from the date on which the Exchange Offer Registration Statement is declared effective and (ii) the date on which a Broker-Dealer is no longer required to deliver a prospectus in connection with market-making or other trading activities. The Company shall provide sufficient copies of the latest version of such Prospectus to Broker-Dealers promptly upon request at any time during such 180-day (or shorter as provided in the foregoing sentence) period in order to facilitate such resales. SECTION 4. SHELF REGISTRATION (a) SHELF REGISTRATION. If (i) the Company is not required to file an Exchange Offer Registration Statement or to consummate the Exchange Offer because the Exchange Offer is not permitted by applicable law or Commission policy (after the procedures set forth in Section 6(a) below have been complied with), or (ii) any Holder of Transfer Restricted Notes notifies the Company in writing prior to the 20th day following the consummation of the Exchange Offer that (A) such Holder is prohibited by applicable law or Commission policy from participating in the Exchange Offer, or (B) such Holder may not resell the Exchange Notes acquired by it in the Exchange Offer to the public without delivering a prospectus and that the Prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales by such Holder, or (C) such Holder is a Broker-Dealer and holds Initial Notes acquired directly from the Company or one of its affiliates, then, upon such Holder's request, the Company shall: (x) cause to be filed a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the Exchange Offer Registration Statement (in either event, the "SHELF REGISTRATION STATEMENT") as promptly as practicable (such date being the "SHELF FILING DEADLINE"), which Shelf Registration Statement shall provide for resales of all Transfer Restricted Notes the Holders of which shall have provided the information required pursuant to Section 4(b) hereof; and (y) use its best efforts to cause such Shelf Registration Statement to be declared effective by the Commission on or before the 75th day after the Shelf Filing Deadline. The Company shall use its best efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure that it is available for resales of Notes by the Holders of Transfer Restricted Notes entitled to the benefit of this Section 4(a), and to ensure that it conforms 5 with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period of at least two years following the effective date of such Shelf Registration Statement (or shorter period that will terminate when all the Notes covered by such Shelf Registration Statement have been sold pursuant to such Shelf Registration Statement). (b) PROVISION BY HOLDERS OF CERTAIN INFORMATION IN CONNECTION WITH THE SHELF REGISTRATION STATEMENT. No Holder of Transfer Restricted Notes may include any of its Transfer Restricted Notes in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnishes to the Company in writing, within 10 business days after receipt of a request therefor, such information as the Company may reasonably request for use in connection with any Shelf Registration Statement or Prospectus or preliminary prospectus included therein. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading. SECTION 5. LIQUIDATED DAMAGES If (i) any of the Registration Statements required by this Agreement is not filed with the Commission on or prior to the date specified for such filing in this Agreement, (ii) any of such Registration Statements has not been declared effective by the Commission on or prior to the date specified for such effectiveness in this Agreement (the "EFFECTIVENESS TARGET DATE"), (iii) the Exchange Offer has not been Consummated within 30 business days after the Effectiveness Target Date with respect to the Exchange Offer Registration Statement or (iv) any Registration Statement required by this Agreement is filed and declared effective but shall thereafter cease to be effective or fail to be usable for its intended purpose without being succeeded immediately by a post-effective amendment to such Registration Statement that cures such failure and that is itself immediately declared effective (each such event referred to in clauses (i) through (iv), a "REGISTRATION DEFAULT"), the Company hereby agrees to pay to each Holder of the Transfer Restricted Notes affected thereby Liquidated Damages in an amount equal to one quarter of one percent (0.25%) per annum on principal amounts of the Transfer Restricted Notes held by such Holder during the 90-day period immediately following the occurrence of any Registration Default and shall increase by an additional one quarter of one percent (0.25%) per annum on the principal amounts of such Transfer Restricted Notes at the end of each subsequent 90-day period, but in no event shall such increase exceed 2.00% per annum (any such interest assessed upon the occurrence of Registration Default is referred to as "LIQUIDATED DAMAGES"). Following the cure of all Registration Defaults relating to any particular Transfer Restricted Notes, the Liquidated Damages payable with respect to the Transfer Restricted Notes as a result of the provisions of this paragraph shall cease. All obligations of the Company set forth in the preceding paragraph that are outstanding with respect to any Transfer Restricted Note at the time such security ceases to be a Transfer Restricted Note shall survive until such time as all such obligations with respect to such Notes shall have been satisfied in full. 6 SECTION 6. REGISTRATION PROCEDURES (a) EXCHANGE OFFER REGISTRATION STATEMENT. In connection with the Exchange Offer, the Company shall comply with all of the provisions of Section 6(c) below, shall use its best efforts to effect such exchange to permit the sale of Transfer Restricted Notes being sold in accordance with the intended method or methods of distribution thereof, and shall comply with all of the following provisions: (i) If in the reasonable opinion of counsel to the Company there is a question as to whether the Exchange Offer is permitted by applicable law, the Company hereby agrees to seek a no-action letter or other favorable decision from the Commission allowing the Company to Consummate an Exchange Offer for such Initial Notes. The Company hereby agrees to pursue the issuance of such a decision to the Commission staff level but shall not be required to take commercially unreasonable action to effect a change of Commission policy. The Company hereby agrees, however, to (A) participate in telephonic conferences with the Commission, (B) deliver to the Commission staff an analysis prepared by counsel to the Company setting forth the legal bases, if any, upon which such counsel has concluded that such an Exchange Offer should be permitted and (C) diligently pursue a favorable resolution by the Commission staff of such submission. (ii) As a condition to its participation in the Exchange Offer pursuant to the terms of this Agreement, each Holder of Transfer Restricted Notes shall furnish, upon the request of the Company, prior to the Consummation thereof, a written representation to the Company (which may be contained in the letter of transmittal contemplated by the Exchange Offer Registration Statement) to the effect that (A) it is not an affiliate of the Company, (B) it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any person to participate in, a distribution of the Exchange Notes to be issued in the Exchange Offer and (C) it is acquiring the Exchange Notes in its ordinary course of business. In addition, all such Holders of Transfer Restricted Notes shall otherwise cooperate in the Company's preparations for the Exchange Offer. Each Holder hereby acknowledges and agrees that any Broker-Dealer and any such Holder using the Exchange Offer to participate in a distribution of the securities to be acquired in the Exchange Offer (1) could not under Commission policy as in effect on the date of this Agreement rely on the position of the Commission enunciated in MORGAN STANLEY AND CO., INC. (available June 5, 1991) and EXXON CAPITAL HOLDINGS CORPORATION (available May 13, 1988), as interpreted in the Commission's letter to Shearman & Sterling dated July 2, 1993, and similar no-action letters (which may include any no-action letter obtained pursuant to clause (i) above), and (2) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such a secondary resale transaction should be covered by an effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K if the resales are of Exchange Notes obtained by such Holder in exchange for Initial Notes acquired by such Holder directly from the Company. (b) SHELF REGISTRATION STATEMENT. In connection with the Shelf Registration Statement, the Company shall comply with all the provisions of Section 6(c) below and shall use its best efforts to effect such registration to permit the sale of the Transfer Restricted Notes being sold in accordance with the intended method or methods of distribution thereof, and pursuant thereto the 7 Company will as expeditiously as possible prepare and file with the Commission a Registration Statement relating to the registration on any appropriate form under the Securities Act, which form shall be available for the sale of the Transfer Restricted Notes in accordance with the intended method or methods of distribution thereof. (c) GENERAL PROVISIONS. In connection with any Registration Statement and any Prospectus required by this Agreement to permit the sale or resale of Transfer Restricted Notes (including, without limitation, any Registration Statement and the related Prospectus required to permit resales of Securities by Broker-Dealers), the Company shall: (i) use its best efforts to keep such Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulations thereunder, financial statements of the Guarantors, if any) for the period specified in Section 3 or 4 of this Agreement, as applicable; upon the occurrence of any event that would cause any such Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective and usable for resale of Transfer Restricted Notes during the period required by this Agreement, the Company shall file promptly an appropriate amendment to such Registration Statement, in the case of clause (A), correcting any such misstatement or omission, and, in the case of either clause (A) or (B), use its best efforts to cause such amendment to be declared effective and such Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter; (ii) prepare and file with the Commission such amendments and post-effective amendments to the Registration Statement as may be necessary to keep the Registration Statement effective for the applicable period set forth in Section 3 or 4 hereof, as applicable, or such shorter period as will terminate when all Transfer Restricted Notes covered by such Registration Statement have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the sellers thereof set forth in such Registration Statement or supplement to the Prospectus; (iii) advise the underwriter(s), if any, and selling Holders promptly and, if requested by such Persons, to confirm such advice in writing, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to any Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the 8 qualification of the Transfer Restricted Notes for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, and (D) of the existence of any fact or the happening of any event that makes any statement of a material fact made in the Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Transfer Restricted Notes under state securities or Blue Sky laws, the Company shall use its best efforts to obtain the withdrawal or lifting of such order at the earliest possible time; (iv) furnish without charge to each of the Initial Purchasers, each selling Holder named in any Registration Statement, and each of the underwriter(s), if any, before filing with the Commission, copies of any Registration Statement or any Prospectus included therein or any amendments or supplements to any such Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Registration Statement), which documents will be subject to the review of such Holders and underwriter(s) in connection with such sale, if any, for a period of at least five business days, and the Company will not file any such Registration Statement or Prospectus or any amendment or supplement to any such Registration Statement or Prospectus (including all such documents incorporated by reference) to which an Initial Purchaser of Transfer Restricted Notes covered by such Registration Statement or the underwriter(s), if any, shall reasonably object in writing within five business days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The objection of an Initial Purchaser or underwriter, if any, shall be deemed to be reasonable if such Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission; (v) promptly prior to the filing of any document that is to be incorporated by reference into a Registration Statement or Prospectus, provide copies of such document to the Initial Purchasers, each selling Holder named in any Registration Statement, and to the underwriter(s), if any, make the Company's and the Guarantors', if any, representatives available for discussion of such document and other customary due diligence matters, and include such information in such document prior to the filing thereof as such selling Holders or underwriter(s), if any, reasonably may request; (vi) make available at reasonable times for inspection by the Initial Purchasers, any managing underwriter participating in any disposition pursuant to such Registration Statement and any attorney or accountant retained by such Initial Purchasers or any of the underwriter(s), all financial and other records, pertinent corporate documents and properties of the Company and each of the Guarantors, if 9 any, and cause the officers, directors and employees of the Company and each of the Guarantors, if any, to supply all information reasonably requested by any such Holder, underwriter, attorney or accountant in connection with such Registration Statement subsequent to the filing thereof and prior to its effectiveness; (vii) if requested by any selling Holders or the underwriter(s), if any, promptly incorporate in any Registration Statement or Prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as such selling Holders and underwriter(s), if any, may reasonably request to have included therein, including, without limitation, information relating to the "Plan of Distribution" of the Transfer Restricted Notes, information with respect to the principal amount of Transfer Restricted Notes being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Transfer Restricted Notes to be sold in such offering; and make all required filings of such Prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment; (viii) cause the Transfer Restricted Notes covered by the Registration Statement to be rated with the appropriate rating agencies, if so requested by the Holders of a majority in aggregate principal amount of Notes covered thereby or the underwriter(s), if any; (ix) furnish to each selling Holder and each of the underwriter(s), if any, without charge, at least one copy of the Registration Statement, as first filed with the Commission, and of each amendment thereto, including financial statements and schedules, all documents incorporated by reference therein and all exhibits (including exhibits incorporated therein by reference); (x) deliver to each selling Holder and each of the underwriter(s), if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request; the Company hereby consents to the use of the Prospectus and any amendment or supplement thereto by each of the selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of the Transfer Restricted Notes covered by the Prospectus or any amendment or supplement thereto; (xi) enter into and cause the Guarantors, if any, to enter into such agreements (including an underwriting agreement), and make and cause the Guarantors, if any, to make such representations and warranties, and take all such other actions in connection therewith in order to expedite or facilitate the disposition of the Transfer Restricted Notes pursuant to any Registration Statement contemplated by this Agreement, all to such extent as may be requested by any Initial Purchaser or by any Holder of Transfer Restricted Notes or underwriter in connection with any sale or resale pursuant to any Registration Statement contemplated by this Agreement; and whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, the Company shall: (1) furnish to each Initial Purchaser, each selling Holder and each underwriter, if any, in such substance and scope as they may request and as are customarily made by 10 issuers to underwriters in primary underwritten offerings, upon the date of the Consummation of the Exchange Offer and, if applicable, the effectiveness of the Shelf Registration Statement: (A) a certificate, dated the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, signed by the Chief Financial Officer of the Company, confirming, as of the date thereof, the matters set forth in Section 7(i) of the Purchase Agreement, and such other matters as such parties may reasonably request; (B) an opinions, dated the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, of counsel for the Company and each of its Subsidiaries (as defined in the Purchase Agreement), covering the matters set forth in Sections 7(c) and 7(d) of the Purchase Agreement and such other matters as such parties may reasonably request, and in any event including a statement to the effect that such counsel has participated in conferences with officers and other representatives of the Company, representatives of the independent public accountants for the Company, the Initial Purchasers' representatives and the Initial Purchasers' counsel in connection with the preparation of such Registration Statement and the related Prospectus and has considered the matters required to be stated therein and the statements contained therein, although such counsel has not independently verified the accuracy, completeness or fairness of such statements; and that such counsel advises that, on the basis of the foregoing, no facts came to such counsel's attention that caused such counsel to believe that the applicable Registration Statement, at the time such Registration Statement or any post-effective amendment thereto became effective, and, in the case of the Exchange Offer Registration Statement, as of the date of Consummation, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus contained in such Registration Statement as of its date and, in the case of the opinion dated the date of Consummation of the Exchange Offer, as of the date of Consummation, contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Without limiting the foregoing, such counsel may state further that such counsel assumes no responsibility for, and has not independently verified, the accuracy, completeness or fairness of the financial statements, notes and schedules and other financial data included in any Registration Statement contemplated by this Agreement or the related Prospectus; and (C) a customary comfort letter, dated as of the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, from the Company's independent accountants, in the customary form and covering matters of the type customarily covered in 11 comfort letters by underwriters in connection with primary underwritten offerings, and affirming the matters set forth in the comfort letters delivered pursuant to Section 7(f) of the Purchase Agreement, without exception; (2) set forth in full or incorporate by reference in the underwriting agreement, if any, the indemnification provisions and procedures of Section 8 hereof with respect to all parties to be indemnified pursuant to said Section; and (3) deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with clause (A) above and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Company or the Guarantors, if any, pursuant to this clause (xi), if any. If at any time the representations and warranties of the Company or the Guarantors, if any, contemplated in this clause (xi) cease to be true and correct, the Company shall so advise the Initial Purchasers and the underwriter(s), if any, and each selling Holder promptly and, if requested by such Persons, shall confirm such advice in writing; (xii) prior to any public offering of Transfer Restricted Notes, cooperate and cause the Guarantors, if any, to cooperate with the selling Holders, the underwriter(s), if any, and their respective counsel in connection with the registration and qualification of the Transfer Restricted Notes under the securities or Blue Sky laws of such jurisdictions as the selling Holders or underwriter(s) may request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Transfer Restricted Notes covered by the Shelf Registration Statement; PROVIDED, HOWEVER, that neither the Company nor any of the Guarantors, if any, shall be required to register or qualify as a foreign corporation where it is not then so qualified or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Registration Statement, in any jurisdiction where it is not then so subject; (xiii) shall issue, upon the request of any Holder of Initial Notes covered by the Shelf Registration Statement, Exchange Notes, having an aggregate principal amount equal to the aggregate principal amount of Initial Notes surrendered to the Company by such Holder in exchange therefor or being sold by such Holder; such Exchange Notes to be registered in the name of such Holder or in the name of the purchaser(s) of such Notes, as the case may be; in return, the Initial Notes held by such Holder shall be surrendered to the Company for cancellation; (xiv) cooperate and cause the Guarantors, if any, to cooperate with the selling Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing 12 Transfer Restricted Notes to be sold and not bearing any restrictive legends; and enable such Transfer Restricted Notes to be in such denominations and registered in such names as the Holders or the underwriter(s), if any, may request at least two business days prior to any sale of Transfer Restricted Notes made by such underwriter(s); (xv) use its best efforts to cause the Transfer Restricted Notes covered by the Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s), if any, to consummate the disposition of such Transfer Restricted Notes, subject to the proviso contained in clause (xii) above; (xvi) if any fact or event contemplated by Section 6(c)(iii)(D) above shall exist or have occurred, prepare a supplement or post-effective amendment to the Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Transfer Restricted Notes, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading; (xvii) provide a CUSIP number for all Exchange Notes not later than the effective date of the Registration Statement and provide the Trustee under the Indenture with printed certificates for the Exchange Notes which are in a form eligible for deposit with the Depositary Trust Company; (xviii) cooperate and assist in any filings required to be made with the NASD and in the performance of any due diligence investigation by any underwriter (including any "qualified independent underwriter") that is required to be retained in accordance with the rules and regulations of the NASD, and use its reasonable best efforts to cause such Registration Statement to become effective and approved by such governmental agencies or authorities as may be necessary to enable the Holders selling Transfer Restricted Notes to consummate the disposition of such Transfer Restricted Notes; (xix) otherwise use its best efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security holders, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 (which need not be audited) for the twelve-month period (A) commencing at the end of any fiscal quarter in which Transfer Restricted Notes are sold to underwriters in a firm or best efforts Underwritten Offering or (B) if not sold to underwriters in such an offering, beginning with the first month of the Company's first fiscal quarter commencing after the effective date of the Registration Statement; (xx) cause the Indenture to be qualified under the Trust Indenture Act not later than the effective date of the first Registration Statement required by this Agreement, and, in connection therewith, cooperate and cause the Guarantors, if any, to cooperate with the Trustee and the Holders of Securities to effect such changes to the Indenture as may be required for such Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and to execute and cause each of the Guarantors, if any, to execute and use its best efforts to cause the Trustee to execute, all documents that 13 may be required to effect such changes and all other forms and documents required to be filed with the Commission to enable such Indenture to be so qualified in a timely manner; (xxi) cause all Transfer Restricted Notes covered by the Registration Statement to be listed on each securities exchange on which similar securities issued by the Company are then listed if requested by the Holders of a majority in aggregate principal amount of Initial Notes or the managing underwriter(s), if any; and (xxii) provide promptly to each Holder upon request each document filed with the Commission pursuant to the requirements of Section 13 and Section 15 of the Exchange Act. Each Holder agrees by acquisition of a Transfer Restricted Note that, upon receipt of any notice from the Company of the existence of any fact of the kind described in Section 6(c)(iii)(D) hereof, such Holder will forthwith discontinue disposition of Transfer Restricted Notes pursuant to the applicable Registration Statement until such Holder's receipt of the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof, or until it is advised in writing (the "ADVICE") by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus. If so directed by the Company, each Holder will deliver to the Company (at the Company's expense) all copies, other than permanent file copies then in such Holder's possession, of the Prospectus covering such Transfer Restricted Notes that was current at the time of receipt of such notice. In the event the Company shall give any such notice, the time period regarding the effectiveness of such Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended by the number of days during the period from and including the date of the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to and including the date when each selling Holder covered by such Registration Statement shall have received the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof or shall have received the Advice; however, no such extension shall be taken into account in determining whether Liquidated Damages are due pursuant to Section 5 hereof or the amount of such Liquidated Damages, it being agreed that the Company's option to suspend use of a Registration Statement pursuant to this paragraph shall be treated as a Registration Default for purposes of Section 5. SECTION 7. REGISTRATION EXPENSES (a) All expenses incident to the Company's or the Guarantors', if any, performance of or compliance with this Agreement will be borne by the Company, regardless of whether a Registration Statement becomes effective, including without limitation: (i) all registration and filing fees and expenses (including filings made by any Initial Purchaser or Holder with the NASD (and, if applicable, the fees and expenses of any "qualified independent underwriter" and its counsel that may be required by the rules and regulations of the NASD)); (ii) all fees and expenses of compliance with federal securities and state Blue Sky or securities laws; (iii) all expenses of printing (including printing certificates for the Exchange Notes to be issued in the Exchange Offer and 14 printing of Prospectuses), messenger and delivery services and telephone; (iv) all fees and disbursements of counsel for the Company and the Guarantors, if any, and, subject to Section 7(b) below, the Holders of Transfer Restricted Notes; (v) all application and filing fees in connection with listing the Exchange Notes on a national securities exchange or automated quotation system pursuant to the requirements thereof; (vi) all fees and disbursements of independent certified public accountants of the Company and each of the Guarantors, if any (including the expenses of any special audit and comfort letters required by or incident to such performance); and (vii) all fees and expenses relating to the qualification of the Indenture under the applicable securities laws. The Company will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Company. (b) In connection with any Registration Statement required by this Agreement (including, without limitation, the Exchange Offer Registration Statement and the Shelf Registration Statement), the Company will reimburse the Initial Purchasers and the Holders of Transfer Restricted Notes being tendered in the Exchange Offer and/or resold pursuant to the "Plan of Distribution" contained in the Exchange Offer Registration Statement or registered pursuant to the Shelf Registration Statement, as applicable, for the reasonable fees and disbursements of not more than one counsel, who shall be Shearman & Sterling or such other counsel as may be chosen by the Holders of a majority in principal amount of the Transfer Restricted Notes for whose benefit such Registration Statement is being prepared. SECTION 8. INDEMNIFICATION (a) The Company agrees to indemnify and hold harmless (i) each Holder and (ii) each person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the persons referred to in this clause (ii) being hereinafter referred to as a "controlling person") and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an "INDEMNIFIED HOLDER"), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including without limitation and as incurred, reimbursement of all reasonable costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is made in reliance upon and in conformity with information relating to any of the Holders furnished in writing to the Company by any of the Holders expressly for use therein. This indemnity agreement shall be in addition to any liability which the Company may otherwise have. 15 (b) Each Holder of Transfer Restricted Notes agrees, severally and not jointly, to indemnify and hold harmless the Company and its directors and officers of the Company who sign a Registration Statement, and any person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company, and the respective offices, directors, partners, employees, representatives and agents of each such person, to the same extent as the foregoing indemnity from the Company to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in any Registration Statement. In case any action or proceeding shall be brought against the Company or its directors or officers or any such controlling person in respect of which indemnity may be sought against a Holder of Transfer Restricted Notes, such Holder shall have the rights and duties given the Company and the Company or its directors or officers or such controlling person shall have the rights and duties given to each Holder by the preceding paragraph. In no event shall the liability of any selling Holder hereunder be greater in amount than the dollar amount of the proceeds received by such Holder upon the sale of the Notes giving rise to such indemnification obligation. (c) Promptly after receipt by an indemnified party under this Section 8 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that the failure to notify the indemnifying party shall not relieve it from any liability that it may have under this Section 8 except to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses 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 this Section 8. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section 8 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that the Indemnified Holders shall have the right to employ counsel to represent jointly the Indemnified Holders and those Indemnified Holders and their respective directors, officers, employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the Indemnified Holders against the Company under this Section 8 if, in the reasonable judgment of the Indemnified Holders, it is advisable for the Indemnified Holders and those directors, officers, employees and controlling persons to be jointly represented by separate counsel, and in that event the fees and expenses of such separate counsel shall be paid by the Company. No indemnifying party shall (i) without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the 16 indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding, or (ii) be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment. (d) If the indemnification provided for in this Section 8 is unavailable to an indemnified party under Section 8(a) or Section 8(b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Company shall be deemed to be equal to the total gross proceeds from the Initial Placement as set forth on the cover page of the Offering Memorandum), the amount of Liquidated Damages which did not become payable as a result of the filing of the Registration Statement resulting in such losses, claims, damages, liabilities, judgments actions or expenses, and such Registration Statement, or if such allocation is not permitted by applicable law, the relative fault of the Company, on the one hand, and of the Indemnified Holder, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Company, on the one hand, and of the Indemnified Holder, on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Indemnified Holder and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 8(a), any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The Company and each Holder of Transfer Restricted Notes agree that it would not be just and equitable if contribution pursuant to this Section 8(d) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, none of the Holders (and its related Indemnified Holders) shall be required to contribute, in the aggregate, any amount in excess of the amount by which the total discount received by such Holder with respect to the Initial Notes exceeds the amount of any damages which such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No 17 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. The Holders' obligations to contribute pursuant to this Section 8(d) are several in proportion to the respective principal amount of Initial Notes held by each of the Holders hereunder and not joint. SECTION 9. RULE 144A Unless the Company is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company shall, for so long as any Transfer Restricted Notes remain outstanding, make available to any Holder or beneficial owner of Transfer Restricted Notes in connection with any sale thereof and any prospective purchaser of such Transfer Restricted Notes from such Holder or beneficial owner, the information required by Rule 144A(d)(4) under the Securities Act in order to permit resales of such Transfer Restricted Notes pursuant to Rule 144A. SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS No Holder may participate in any Underwritten Registration hereunder unless such Holder (a) agrees to sell such Holder's Transfer Restricted Notes on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lock-up letters and other documents required under the terms of such underwriting arrangements. SECTION 11. SELECTION OF UNDERWRITERS The Holders of Transfer Restricted Notes covered by the Shelf Registration Statement who desire to do so may sell such Transfer Restricted Notes in an Underwritten Offering. In any such Underwritten Offering, the investment banker or investment bankers and manager or managers that will administer the offering will be selected by the Holders of a majority in aggregate principal amount of the Transfer Restricted Notes included in such offering; PROVIDED, that such investment bankers and managers must be reasonably satisfactory to the Company. SECTION 12. MISCELLANEOUS (a) REMEDIES. The Company hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate. (b) NO INCONSISTENT AGREEMENTS. The Company will not and will cause the Guarantors, if any, not to, on or after the date of this Agreement, enter into any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. The Company has not entered into any agreement granting any registration rights with respect to its securities to any Person. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company's securities under any agreement in effect on the date hereof. 18 (c) ADJUSTMENTS AFFECTING THE SECURITIES. The Company will not take any action, or permit any change to occur, with respect to the Notes that would materially and adversely affect the ability of the Holders to Consummate any Exchange Offer, unless such action or change is required by applicable law. (d) AMENDMENTS AND WAIVERS. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Company has obtained the written consent of Holders of a majority of the outstanding principal amount of Transfer Restricted Notes. Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Transfer Restricted Notes being tendered or registered; PROVIDED that, with respect to any matter that directly or indirectly affects the rights of any Initial Purchaser hereunder, the Company shall obtain the written consent of each such Initial Purchaser with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective. (e) NOTICES. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery: (i) if to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture; and (ii) if to the Company: Wackenhut Corrections Corporation One Park Place 621 NW 53rd Street Suite 700 Boca Raton, FL 33487 Facsimile: (561) 999-7744 Attention: John J. Bulfin, Esq. with a copy to: Akerman Senterfitt One Southeast Third Avenue 28th Floor Miami, FL 33131-1714 Facsimile: (305) 374-5095 Attention: Stephen K. Roddenberry 19 (iii) if to the Initial Purchasers: BNP Paribas Securities Corp. The Equitable Tower 787 Seventh Avenue New York, NY 10019-6016 Facsimile: (212) 841-3561 Attention: Douglas Cook, Esq. Lehman Brothers Inc. 745 Seventh Avenue New York, NY 10019 Facsimile: (212) 526-0943 Attention: Syndicate and Lehman Brothers Inc. Litigation Department 399 Park Avenue New York, NY 10022 with a copy to: Shearman & Sterling LLP 599 Lexington Avenue New York, NY 10022-6069 Facsimile: (212) 848-7179 Attention: Andrew Schleider All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five business days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if faxed; and on the next business day, if timely delivered to an air courier guaranteeing overnight delivery. Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture. (f) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including without limitation and without the need for an express assignment, subsequent Holders of Transfer Restricted Notes; PROVIDED, HOWEVER, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Transfer Restricted Notes from such Holder. (g) COUNTERPARTS. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of 20 which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. (h) HEADINGS. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. (i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. (j) SEVERABILITY. In the event that 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. (k) ENTIRE AGREEMENT. This Agreement together with the Purchase Agreement, the Notes, and the Indenture is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Company with respect to the Transfer Restricted Notes. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 21 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. WACKENHUT CORRECTIONS CORPORATION By: /s/ John G. O'Rourke ------------------------------- Name: John G. O'Rourke Title: Chief Financial Officer- Senior Vice President The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written. BNP PARIBAS SECURITIES CORP. LEHMAN BROTHERS INC. FIRST ANALYSIS SECURITIES CORPORATION SOUTHTRUST SECURITIES, INC. COMERICA SECURITIES, INC. Acting severally on behalf of themselves and the several Initial Purchasers By: BNP Paribas Securities Corp. By: /s/ Douglas Cook ----------------------------------- Name: Douglas Cook Title: Managing Direcor 22 EX-10.1 6 g84060exv10w1.txt EX-10.1 AMENDED AND RESTATED CREDIT AGREEMENT Exhibit 10.1 ================================================================================ $150,000,000 AMENDED AND RESTATED CREDIT AGREEMENT dated as of July 9, 2003, by and among WACKENHUT CORRECTIONS CORPORATION, as Borrower, the Lenders referred to herein, BNP PARIBAS, as Administrative Agent and Syndication Agent, BANK OF AMERICA, N.A. and SOUTHTRUST BANK, as Co-Syndication Agents, and COMERICA BANK, as Co-Documentation Agent ================================================================================ BNP PARIBAS, as Lead Arranger TABLE OF CONTENTS

PAGE ARTICLE I DEFINITIONS............................................................................... 1 SECTION 1.1 Definitions........................................................................ 1 SECTION 1.2 General............................................................................ 18 SECTION 1.3 Other Definitions and Provisions................................................... 18 SECTION 1.4 Effectiveness of Euro Provisions................................................... 18 SECTION 1.5 Currency Equivalents............................................................... 18 ARTICLE II REVOLVING CREDIT FACILITY................................................................. 18 SECTION 2.1 Revolving Credit Loans............................................................. 18 SECTION 2.2 Swingline Loans.................................................................... 19 SECTION 2.3 Procedure for Advances of Revolving Credit Loans and Swingline Loans............... 20 SECTION 2.4 Repayment of Loans................................................................. 21 SECTION 2.5 Notes.............................................................................. 21 SECTION 2.6 Permanent Reduction of the Revolving Credit Commitment............................. 22 SECTION 2.7 Termination of Revolving Credit Facility........................................... 22 ARTICLE III LETTER OF CREDIT FACILITY................................................................. 22 SECTION 3.1 L/C Commitment..................................................................... 22 SECTION 3.2 Procedure for Issuance of Letters of Credit........................................ 23 SECTION 3.3 Commissions and Other Charges...................................................... 23 SECTION 3.4 L/C Participations................................................................. 24 SECTION 3.5 Reimbursement of Letter of Credit Drawings......................................... 25 SECTION 3.6 Obligations Absolute............................................................... 26 SECTION 3.7 Excess L/C Obligations............................................................. 26 SECTION 3.8 Redenomination under EMU........................................................... 26 SECTION 3.9 Regulatory Limitation.............................................................. 27 SECTION 3.10 Exchange Indemnification and Increased Costs....................................... 27 SECTION 3.11 Rounding and Other Consequential Changes........................................... 27 SECTION 3.12 Effect of Application.............................................................. 27 ARTICLE IV TERM LOAN FACILITY........................................................................ 28 SECTION 4.1 Term Loan.......................................................................... 28 SECTION 4.2 Procedure for Advance of Term Loan................................................. 28 SECTION 4.3 Repayment of Term Loan............................................................. 28 SECTION 4.4 Prepayments of Term Loan........................................................... 29 SECTION 4.5 Term Notes......................................................................... 30

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PAGE ARTICLE V GENERAL LOAN PROVISIONS................................................................... 31 SECTION 5.1 Interest........................................................................... 31 SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans........................... 33 SECTION 5.3 Fees............................................................................... 33 SECTION 5.4 Manner of Payment.................................................................. 33 SECTION 5.5 Crediting of Payments and Proceeds................................................. 34 SECTION 5.6 Adjustments........................................................................ 34 SECTION 5.7 Nature of Obligations of Lenders Regarding Extensions of Credit; Assumption by the Administrative Agent............................................................... 35 SECTION 5.8 Changed Circumstances.............................................................. 35 SECTION 5.9 Indemnity.......................................................................... 37 SECTION 5.10 Capital Requirements............................................................... 37 SECTION 5.11 Taxes.............................................................................. 37 SECTION 5.12 Security........................................................................... 39 ARTICLE VI CLOSING; CONDITIONS OF CLOSING AND BORROWING.............................................. 39 SECTION 6.1 Closing............................................................................ 39 SECTION 6.2 Conditions to Closing.............................................................. 39 SECTION 6.3 Conditions to All Extensions of Credit............................................. 43 ARTICLE VII REPRESENTATIONS AND WARRANTIES OF THE BORROWER............................................ 44 SECTION 7.1 Representations and Warranties..................................................... 44 SECTION 7.2 Survival of Representations and Warranties, Etc.................................... 50 ARTICLE VIII FINANCIAL INFORMATION AND NOTICES......................................................... 50 SECTION 8.1 Financial Statements and Projections............................................... 50 SECTION 8.2 Officer's Compliance Certificate................................................... 51 SECTION 8.3 Annual Accountants' Certificate.................................................... 51 SECTION 8.4 Other Reports...................................................................... 52 SECTION 8.5 Notice of Litigation and Other Matters............................................. 52 SECTION 8.6 Accuracy of Information............................................................ 53 ARTICLE IX AFFIRMATIVE COVENANTS..................................................................... 53 SECTION 9.1 Preservation of Corporate Existence and Related Matters............................ 53 SECTION 9.2 Maintenance of Property............................................................ 53 SECTION 9.3 Insurance.......................................................................... 53 SECTION 9.4 Accounting Methods and Financial Records........................................... 53 SECTION 9.5 Payment and Performance of Obligations............................................. 54

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PAGE SECTION 9.6 Compliance With Laws and Approvals................................................. 54 SECTION 9.7 Environmental Laws................................................................. 54 SECTION 9.8 Compliance with ERISA.............................................................. 54 SECTION 9.9 Compliance With Agreements......................................................... 54 SECTION 9.10 Visits and Inspections............................................................. 54 SECTION 9.11 Additional Subsidiaries............................................................ 55 SECTION 9.12 Use of Proceeds.................................................................... 56 SECTION 9.13 Landlord Consents.................................................................. 56 SECTION 9.14 Further Assurances................................................................. 56 ARTICLE X FINANCIAL COVENANTS....................................................................... 56 SECTION 10.1 Leverage Ratios.................................................................... 56 SECTION 10.2 Fixed Charge Coverage Ratio........................................................ 57 SECTION 10.3 Capital Expenditures............................................................... 57 SECTION 10.4 Minimum Net Worth.................................................................. 57 ARTICLE XI NEGATIVE COVENANTS........................................................................ 58 SECTION 11.1 Limitations on Debt................................................................ 58 SECTION 11.2 Limitations on Liens............................................................... 59 SECTION 11.3 Limitations on Loans, Advances, Investments and Acquisitions....................... 59 SECTION 11.4 Limitations on Mergers and Liquidation............................................. 61 SECTION 11.5 Limitations on Sale of Assets...................................................... 61 SECTION 11.6 Restricted Payments................................................................ 61 SECTION 11.7 Limitations on Exchange and Issuance of Capital Stock.............................. 62 SECTION 11.8 Transactions with Affiliates....................................................... 62 SECTION 11.9 Certain Accounting Changes; Organizational Documents............................... 62 SECTION 11.10 Amendments; Payments and Prepayments of Certain Debt............................... 62 SECTION 11.11 Restrictive Agreements............................................................. 62 SECTION 11.12 Nature of Business................................................................. 62 SECTION 11.13 Impairment of Security Interests................................................... 62 ARTICLE XII DEFAULT AND REMEDIES...................................................................... 63 SECTION 12.1 Events of Default.................................................................. 63 SECTION 12.2 Remedies........................................................................... 65 SECTION 12.3 Rights and Remedies Cumulative; Non-Waiver; etc.................................... 65 SECTION 12.4 Judgment Currency.................................................................. 66

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PAGE ARTICLE XIII THE AGENTS................................................................................ 66 SECTION 13.1 Appointment........................................................................ 66 SECTION 13.2 Delegation of Duties............................................................... 66 SECTION 13.3 Exculpatory Provisions............................................................. 67 SECTION 13.4 Reliance by the Agents............................................................. 67 SECTION 13.5 Notice of Default.................................................................. 67 SECTION 13.6 Non-Reliance on the Agents and Other Lenders....................................... 68 SECTION 13.7 Indemnification.................................................................... 68 SECTION 13.8 The Agents in Their Individual Capacities.......................................... 68 SECTION 13.9 Resignation of the Agents; Successor Agents........................................ 68 ARTICLE XIV MISCELLANEOUS............................................................................. 69 SECTION 14.1 Notices............................................................................ 69 SECTION 14.2 Expenses; Indemnity................................................................ 71 SECTION 14.3 Set-off............................................................................ 72 SECTION 14.4 Governing Law...................................................................... 72 SECTION 14.5 Jurisdiction and Venue............................................................. 72 SECTION 14.6 Waiver of Jury Trial............................................................... 73 SECTION 14.7 Reversal of Payments............................................................... 73 SECTION 14.8 Injunctive Relief; Punitive Damages................................................ 73 SECTION 14.9 Accounting Matters................................................................. 73 SECTION 14.10 Successors and Assigns; Participations............................................. 74 SECTION 14.11 Amendments, Waivers and Consents................................................... 77 SECTION 14.12 Performance of Duties.............................................................. 78 SECTION 14.13 All Powers Coupled with Interest................................................... 78 SECTION 14.14 Survival of Indemnities............................................................ 79 SECTION 14.15 Titles and Captions................................................................ 79 SECTION 14.16 Severability of Provisions......................................................... 79 SECTION 14.17 Counterparts....................................................................... 79 SECTION 14.18 Term of Agreement.................................................................. 79 SECTION 14.19 Advice of Counsel.................................................................. 79 SECTION 14.20 No Strict Construction............................................................. 79 SECTION 14.21 Inconsistencies with Other Documents; Independent Effect of Covenants............ 79 SECTION 14.22 Continuity of Contract............................................................. 80

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PAGE SECTION 14.23 Increase of Revolving Credit Commitments........................................... 80 SECTION 14.24 Transition Provisions.............................................................. 80

v TABLE OF CONTENTS (CONTINUED) EXHIBITS Exhibit A-1 - Form of Revolving Credit Note Exhibit A-2 - Form of Swingline Note Exhibit A-3 - Form of Term Note Exhibit B - Form of Notice of Borrowing Exhibit C - Form of Notice of Account Designation Exhibit D - Form of Notice of Prepayment Exhibit E - Form of Notice of Conversion/Continuation Exhibit F - Form of Officer's Compliance Certificate Exhibit G - Form of Assignment and Acceptance Exhibit H - Form of Guaranty Agreement Exhibit I - Form of Collateral Agreement Exhibit J - Form of Joinder Agreement Exhibit K - Form of Collateral Assignment SCHEDULES Schedule 1.1(a) - Unrestricted Subsidiaries Schedule 4.4(b)(iii) - Certain Assets Schedule 7.1(a) - Jurisdictions of Organization and Qualification Schedule 7.1(b) - Subsidiaries and Capitalization Schedule 7.1(i) - ERISA Plans Schedule 7.1(l) - Material Contracts Schedule 7.1(m) - Labor and Collective Bargaining Agreements Schedule 7.1(r) - Real Estate Owned Schedule 7.1(t) - Debt and Guaranty Obligations Schedule 7.1(u) - Litigation Schedule 11.2 - Existing Liens Schedule 11.3 - Existing Loans, Advances and Investments Schedule 11.8 - Transactions with Affiliates vi AMENDED AND RESTATED CREDIT AGREEMENT, dated as of the 9th day of July, 2003, by and among WACKENHUT CORRECTIONS CORPORATION, a Florida corporation, as Borrower, the lenders who are or may become a party to this Agreement, as Lenders, BNP PARIBAS, as Administrative Agent for the Lenders, and BNP PARIBAS, as Syndication Agent. STATEMENT OF PURPOSE The Borrower, the lenders parties thereto, Wachovia Bank, National Association, as administrative agent, and BNP Paribas, as syndication agent, entered into a Credit Agreement dated as of December 12, 2002 (as amended, modified or supplemented to the date hereof, the "Existing Facility"). The parties hereto desire to amend and restate the Existing Facility as provided herein. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, such parties hereby agree that the Existing Facility shall be amended and restated in its entirety as follows: ARTICLE I DEFINITIONS SECTION 1.1 Definitions. The following terms when used in this Agreement shall have the meanings assigned to them below: "Administrative Agent" means BNP Paribas in its capacity as Administrative Agent hereunder, and any successor thereto appointed pursuant to Section 13.9. "Administrative Agent's Office" means the office of the Administrative Agent specified in or determined in accordance with the provisions of Section 14.1(c). "Affiliate" means, with respect to any Person, any other Person (other than a Subsidiary of the Borrower) which directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such first Person or any of its Subsidiaries. The term "control" means (a) the power to vote ten percent (10%) or more of the securities or other equity interests of a Person having ordinary voting power, or (b) the possession, directly or indirectly, of any other power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. "Agents" means the collective reference to the Administrative Agent and the Syndication Agent. "Aggregate Commitment" means the aggregate amount of the Lenders' Commitments hereunder, as such amount may be reduced or otherwise modified at any time or from time to time pursuant to the terms hereof. On the Closing Date, the Aggregate Commitment shall be One Hundred Fifty Million Dollars ($150,000,000). "Agreement" means this Amended and Restated Credit Agreement, as amended, restated, supplemented or otherwise modified from time to time. "Alternative Currency" means (a) the euro, (b) the Pound Sterling, (c) the Australian Dollar, (d) the South African Rand and (e) with the prior written consent of the Issuing Lender, any other lawful currency (other than Dollars); provided that in each case of (a) through (e) above, such currency is freely transferable and convertible into Dollars in the United States currency market and freely available to the Issuing Lender in the London interbank deposit market. "Alternative Currency Letter of Credit" means any Letter of Credit denominated in an Alternative Currency and all such Alternative Currency Letters of Credit collectively as the context requires. "Applicable Law" means all applicable provisions of constitutions, laws, statutes, ordinances, rules, treaties, regulations, permits, licenses, approvals, interpretations and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators. "Applicable Margin" has the meaning assigned thereto in Section 5.1(c). "Application" means an application, in the form specified by the Issuing Lender from time to time, requesting the Issuing Lender to issue a Letter of Credit. "Approved Fund" means any Person (other than a natural Person), including, without limitation, any special purpose entity, that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business; provided, that such Approved Fund must be administered by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender. "Assignment and Acceptance" has the meaning assigned thereto in Section 14.10. "Assignment Agreement" has the meaning set forth in the Collateral Agreement. "Assignment of Claims Act" means Assignment of Claims Act of 1940 (41 U.S.C. Section 15, 31 U.S.C. Section 3737, and 31 U.S.C. Section 3727), including all amendments thereto and regulations promulgated thereunder. "Australian Dollars" means, at any time of determination, the then official currency of Australia. "Base Rate" means, at any time, the higher of (a) the Prime Rate and (b) the Federal Funds Rate plus 1/2 of 1%; each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the Prime Rate or the Federal Funds Rate. "Base Rate Loan" means any Loan bearing interest at a rate based upon the Base Rate as provided in Section 5.1(a). "Benefited Lender" has the meaning assigned thereto in Section 5.6. "Borrower" means Wackenhut Corrections Corporation, a Florida corporation, in its capacity as borrower hereunder. "Business Day" means (a) for all purposes other than as set forth in clause (b) below, any day other than a Saturday, Sunday or legal holiday on which banks in New York, New York, are open for the conduct of their domestic or international commercial banking business, as applicable, and (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and that is also a day for trading by and between banks in Dollar deposits in the London interbank market. Notwithstanding the foregoing, with respect to any amount denominated or to be denominated in the euro, any reference to a "Business Day" shall be construed as a reference to a day (other than a Saturday or Sunday) on which 2 banks are generally open for business in New York, New York and prime banks in London generally provide quotations for deposits denominated in the euro. "Calculation Date" has the meaning assigned thereto in Section 5.1(c). "Capital Asset" means, with respect to the Borrower and its Subsidiaries, any asset that should, in accordance with GAAP, be classified and accounted for as a capital asset on a Consolidated balance sheet of the Borrower and its Subsidiaries. "Capital Expenditures" means with respect to the Borrower and its Restricted Subsidiaries for any period, the aggregate cost of all Capital Assets acquired by the Borrower and its Restricted Subsidiaries during such period, as determined in accordance with GAAP. "Capital Lease" means any lease of any property by the Borrower or any of its Restricted Subsidiaries, as lessee, that should, in accordance with GAAP, be classified and accounted for as a capital lease on a Consolidated balance sheet of the Borrower and its Subsidiaries. "Change in Control" has the meaning assigned thereto in Section 12.1(h). "Closing Date" means the date of this Agreement or such later Business Day upon which each condition described in Section 6.2 shall be satisfied or waived in all respects in a manner acceptable to the Agents, in their sole discretion. "Code" means the Internal Revenue Code of 1986, and the rules and regulations thereunder, each as amended or modified from time to time. "Collateral" means the collateral security for the Obligations pledged or granted pursuant to the Security Documents. "Collateral Agreement" means the amended and restated collateral agreement of even date executed by the Borrower and each Restricted Domestic Subsidiary in favor of the Administrative Agent for the ratable benefit of itself and the Lenders, substantially in the form of Exhibit I, as further amended, restated, supplemented or otherwise modified from time to time. "Collateral Assignment" means the amended and restated collateral assignment agreement of even date herewith executed by the Borrower or any of its Restricted Subsidiaries, as applicable, substantially in the form of Exhibit K, in favor of the Administrative Agent for the ratable benefit of itself and the Lenders, as further amended, restated or supplemented from time to time. "Commitment" means, as to any Lender, the sum of such Lender's Revolving Credit Commitment and Term Loan Commitment, as set forth in the Register, as the same may be reduced or modified at any time or from time to time pursuant to the terms hereof. "Commitment Percentage" means, as to any Lender at any time, the ratio of (a) the Sum of the Revolving Credit Commitment of such Lender and the outstanding principal balance of the Term Loan of such Lender to (b) the sum of the Revolving Credit Commitments of all Lenders and the outstanding principal balance of the Term Loans of all Lenders. "Consolidated" means, when used with reference to financial statements or financial statement items of the Borrower and its Subsidiaries, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP. 3 "Credit Facility" means, collectively, the Revolving Credit Facility, the Term Loan Facility, the Swingline Facility and the L/C Facility. "Debt" means, with respect to the Borrower and its Subsidiaries at any date and without duplication, the sum of the following calculated in accordance with GAAP: (a) all liabilities, obligations and indebtedness for borrowed money including, but not limited to, obligations evidenced by bonds, debentures, notes or other similar instruments of any such Person, (b) all obligations to pay the deferred purchase price of property or services of any such Person (including, without limitation, all obligations under non-competition agreements, except for non-competition agreements in existence as of the Closing Date with Persons who are employees of the Borrower or its Subsidiaries), except trade payables arising in the ordinary course of business not more than ninety (90) days past due or payable on such later date as is customary in the trade, (c) all obligations of any such Person as lessee under Capital Leases, (d) all Debt of any other Person secured by a Lien on any asset of the Borrower and its Restricted Subsidiaries, (e) all Guaranty Obligations of any such Person, (f) all obligations, contingent or otherwise, of any such Person relative to the face amount of letters of credit, whether or not drawn, including, without limitation, any Reimbursement Obligation, and banker's acceptances issued for the account of any such Person, (g) all obligations of any such Person to redeem, repurchase, exchange, defease or otherwise make payments in respect of capital stock or other securities or partnership interests of such Person, (h) all net payment obligations incurred by any such Person pursuant to Hedging Agreements (which shall be deemed to be the Termination Value thereof as of the date of calculation), to the extent such net payment obligations exceed $1,000,000 on the date of determination, except for any net payment obligations associated with any Non-Recourse Project Financing Indebtedness, (i) all outstanding payment obligations with respect to Synthetic Leases and (j) the outstanding attributed principal amount under any asset securitization program. "Default" means any of the events specified in Section 12.1 which with the passage of time, the giving of notice or any other condition, would constitute an Event of Default. "Disputes" shall have the meaning set forth in Section 14.6. "Dollar Amount" means (a) with respect to each Letter of Credit issued or extended (or to be issued or extended), in Dollars, the principal amount thereof and (b) with respect to each Alternative Currency Letter of Credit, the amount of Dollars which is equivalent to the face amount of such Letter of Credit, at the most favorable spot exchange rate determined by the Issuing Lender at approximately 11:00 a.m. (local time at the office of the Issuing Lender's Correspondent) two (2) Business Days before such Letter of Credit is issued or extended (or to be issued or extended). When used with respect to any other sum expressed in an Alternative Currency, "Dollar Amount" shall mean the amount of Dollars which is equivalent to the amount so expressed in such Alternative Currency at the most favorable spot exchange rate determined by the applicable Issuing Lender to be available to it at the relevant time. "Dollars" or "$" means, unless otherwise qualified, dollars in lawful currency of the United States. "Domestic Subsidiary" means any Subsidiary that is organized under the laws of any political subdivision of the United States. "EBITDA" means, for any period, the sum of the following determined on a Consolidated basis, without duplication, for the Borrower and its Restricted Subsidiaries in accordance with GAAP: (a) Net Income for such period plus (b) the sum of the following to the extent deducted in determining Net Income: (i) income and franchise taxes, (ii) Interest Expense, (iii) amortization, depreciation and other non-cash charges (including insurance reserves), and (iv) extraordinary losses less (c) interest income and 4 any extraordinary gains, including, but not limited to, any gain from the sale of PCG; provided that, for purpose of calculating EBITDA, any start-up costs incurred in connection with new facilities may, to the extent deducted in determining Net Income, be amortized equally over a four (4) fiscal quarter period (consisting of the fiscal quarter in which such costs were incurred and expensed and the next three (3) succeeding fiscal quarters). "Eligible Assignee" means, with respect to any assignment of the rights, interest and obligations of a Lender hereunder, a Person that is at the time of such assignment (a) a commercial bank organized under the laws of the United States or any state thereof, having combined capital and surplus in excess of $500,000,000, (b) a commercial bank organized under the laws of any other country that is a member of the Organization of Economic Cooperation and Development, or a political subdivision of any such country, having combined capital and surplus in excess of $500,000,000, (c) a finance company, insurance company or other financial institution which in the ordinary course of business extends credit of the type extended hereunder and that has total assets in excess of $1,000,000,000, (d) already a Lender hereunder (whether as an original party to this Agreement or as the assignee of another Lender), (e) the successor (whether by transfer of assets, merger or otherwise) to all or substantially all of the commercial lending business of the assigning Lender, (f) any Affiliate of an assigning Lender or (g) any Approved Fund or (h) any other Person that has been approved in writing as an Eligible Assignee by the Borrower (other than upon the occurrence and during the continuance of any Default or Event of Default) and the Administrative Agent. "Employee Benefit Plan" means any employee benefit plan within the meaning of Section 3(3) of ERISA which (a) is maintained for employees of the Borrower or any ERISA Affiliate or (b) has at any time within the preceding six (6) years been maintained for the employees of the Borrower or any current or former ERISA Affiliate. "EMU" means economic and monetary union as contemplated in the Treaty on European Union. "EMU Legislation" means legislative measures of the Council of European Union for the introduction of, change over to or operation of the euro. "Environmental Claims" means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, accusations, allegations, notices of noncompliance or violation, investigations (other than internal reports prepared by any Person in the ordinary course of business and not in response to any third party action or request of any kind) or proceedings relating in any way to any actual or alleged violation of or liability under any Environmental Law or relating to any permit issued, or any approval given, under any such Environmental Law, including, without limitation, any and all claims by Governmental Authorities for enforcement, cleanup, removal, response, remedial or other actions or damages, contribution, indemnification, cost recovery, compensation or injunctive relief resulting from Hazardous Materials or arising from alleged injury or threat of injury to human health or the environment. "Environmental Laws" means any and all federal, foreign, state, provincial and local laws, statutes, ordinances, rules, regulations, permits, licenses, approvals, and orders of courts or Governmental Authorities, relating to the protection of human health or the environment, including, but not limited to, requirements pertaining to the manufacture, processing, distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing, permitting, investigation or remediation of Hazardous Materials. "ERISA" means the Employee Retirement Income Security Act of 1974, and the rules and regulations thereunder, each as amended or modified from time to time. 5 "ERISA Affiliate" means any Person who together with the Borrower is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA. "euro" means the single currency to which the Participating Member States of the European Union have converted. "Eurodollar Reserve Percentage" means, for any day, the percentage (expressed as a decimal and rounded upwards, if necessary, to the next higher 1/100th of 1%) which is in effect for such day as prescribed by the Federal Reserve Board (or any successor) for determining the maximum reserve requirement (including, without limitation, any basic, supplemental or emergency reserves) in respect of eurocurrency liabilities or any similar category of liabilities for a member bank of the Federal Reserve System in New York City. "Event of Default" means any of the events specified in Section 12.1, provided that any requirement for passage of time, giving of notice, or any other condition, has been satisfied. "Excess Cash Flow" means, for any period, the sum of the following determined on a Consolidated basis, without duplication, for the Borrower and its Restricted Subsidiaries in accordance with GAAP: (a) EBITDA minus (b) Interest Expense paid in cash minus (c) cash taxes, (d)(i) minus any increases in working capital or (ii) plus any decreases in working capital minus (e) Capital Expenditures to the extent paid in cash, minus (f) all scheduled amortization payments made and optional prepayments with respect to the Term Loan Facility. "Excess Proceeds" shall have the meaning assigned thereto in Section 2.6(b). "Existing Facility" has the meaning given to that term in the Statement of Purpose hereof. "Extensions of Credit" means, as to any Lender at any time, (a) an amount equal to the sum of (i) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding, (ii) such Lender's Revolving Credit Commitment Percentage of the L/C Obligations then outstanding, (iii) such Lender's Revolving Credit Commitment Percentage of the Swingline Loans then outstanding and (iv) the aggregate principal amount of all Term Loans made by such Lender then outstanding, or (b) the making of any Loan or participation in any Letter of Credit by such Lender, as the context requires. "FDIC" means the Federal Deposit Insurance Corporation, or any successor thereto. "Federal Funds Rate" means, the rate per annum (rounded upwards, if necessary, to the next higher 1/100th of 1%) representing the daily effective federal funds rate as quoted by the Administrative Agent and confirmed in Federal Reserve Board Statistical Release H.15 (519) or any successor or substitute publication selected by the Administrative Agent. If, for any reason, such rate is not available, then "Federal Funds Rate" shall mean a daily rate which is determined, in the reasonable opinion of the Administrative Agent, to be the rate at which federal funds are being offered for sale in the national federal funds market at 9:00 a.m. (New York time). Rates for weekends or holidays shall be the same as the rate for the most immediately preceding Business Day. "Fiscal Year" means the fiscal year of the Borrower and its Subsidiaries ending on the last Sunday closest to calendar year end. "Foreign Subsidiary" means any Subsidiary that is not a Domestic Subsidiary. 6 "GAAP" means generally accepted accounting principles, as recognized by the American Institute of Certified Public Accountants and the Financial Accounting Standards Board, consistently applied and maintained on a consistent basis for the Borrower and its Subsidiaries throughout the period indicated and (subject to Section 14.9) consistent with the prior financial practice of the Borrower and its Subsidiaries. "Government Contract" means a contract between the Borrower or any Restricted Subsidiary and an agency, department or instrumentality of the United States or any state, municipal or local Governmental Authority located in the United States or all obligations of any such Governmental Authority arising under any Account (as defined in the UCC) now or hereafter owing by any Governmental Authority, as account debtor, to the Borrower or any Restricted Subsidiary. "Governmental Approvals" means all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and reports to, all Governmental Authorities. "Governmental Authority" means any nation, province, state or political subdivision thereof, and any government or any Person exercising executive, legislative, regulatory or administrative functions of or pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing. "Guarantors" means the Restricted Domestic Subsidiaries (other than WIH) and any other Person which, after the Closing Date, becomes a party to the Guaranty Agreement by executing and delivering a Joinder Agreement. "Guaranty Agreement" means the unconditional amended and restated guaranty agreement of even date executed by the Guarantors in favor of the Administrative Agent for the ratable benefit of itself and the Lenders, substantially in the form of Exhibit H, as further amended, restated, supplemented or otherwise modified from time to time. "Guaranty Obligation" means, with respect to the Borrower and its Subsidiaries, without duplication, any obligation, contingent or otherwise, of any such Person pursuant to which such Person has directly or indirectly guaranteed any Debt or other financial obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of any such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement condition or otherwise) or (b) entered into for the purpose of assuring in any other manner the obligee of such Debt or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided, that the term Guaranty Obligation shall not include endorsements for collection or deposit in the ordinary course of business. "G4" means Group 4 Falck A/S, a Denmark corporation, and its successors. "Hazardous Materials" means any substances or materials (a) which are or become defined as hazardous wastes, hazardous substances, pollutants, contaminants, chemical substances or mixtures or toxic substances under any Environmental Law, (b) which are toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human health or the environment and are or become regulated by any Governmental Authority, (c) the presence of which require investigation or remediation under any Environmental Law or common law, (d) the discharge or emission or release of which requires a permit or license under any Environmental Law or other Governmental Approval, (e) which are deemed to constitute a nuisance or a trespass which pose a health or safety hazard 7 to Persons or neighboring properties, (f) which consist of underground or aboveground storage tanks, whether empty, filled or partially filled with any substance, or (g) which contain, without limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas. "Hedging Agreement" means any agreement with respect to any Interest Rate Contract, forward rate agreement, commodity swap, forward foreign exchange agreement, currency swap agreement, cross-currency rate swap agreement, currency option agreement or other agreement or arrangement designed to alter the risks of any Person arising from fluctuations in interest rates, currency values or commodity prices, all as amended, restated, supplemented or otherwise modified from time to time. "Hedging Obligations" has the meaning assigned thereto in the definition of "Obligations". "High-Yield Notes" means $150,000,000 8 1/4% senior unsecured high-yield notes due 2013 issued by the Borrower on the Closing Date. "High-Yield Note Indenture" means the Indenture under which the High-Yield Notes are issued. "Insurance and Condemnation Proceeds" has the meaning assigned thereto in Section 4.4(b)(iv). "Interest Expense" means, with respect to the Borrower and its Restricted Subsidiaries (other than with respect to any Non-Recourse Project Financing Indebtedness) for any period, the gross interest expense (including, without limitation, interest expense attributable to Capital Leases, Synthetic Leases (which shall be treated the same as Capital Leases for purposes of this definition) and all net payment obligations pursuant to Hedging Agreements), all determined for such period on a Consolidated basis, without duplication, in accordance with GAAP except as expressly provided in this definition. "Interest Period" has the meaning assigned thereto in Section 5.1(b). "Interest Rate Contract" means any interest rate swap agreement, interest rate cap agreement, interest rate floor agreement, interest rate collar agreement, interest rate option or any other agreement regarding the hedging of interest rate risk exposure executed in connection with hedging the interest rate exposure of any Person and any confirming letter executed pursuant to such agreement, all as amended, restated, supplemented or otherwise modified from time to time. "ISP98" means the International Standby Practices (1998 Revision, effective January 1, 1999), International Chamber of Commerce Publication No. 590. "Issuing Lender" means BNP Paribas, in its capacity as issuer of any Letter of Credit, or any successor thereto, or any other Lender to whom any portion of the L/C Commitment is assigned in the case where the Issuing Lender is not able to issue the requested Letter of Credit. "Issuing Lender's Correspondent" means BNP Paribas, New York Branch, or any other financial institution designated by the Issuing Lender to act as its correspondent hereunder with respect to the issuance and payment of Alternative Currency Letters of Credit. "Joinder Agreement" means collectively, each joinder agreement executed in favor of the Administrative Agent for the ratable benefit of itself and the Lenders, substantially in the form of Exhibit J. 8 "L/C Commitment" means the lesser of (a) Forty Million Dollars ($40,000,000) and (b) the Revolving Credit Commitments of all Lenders. "L/C Facility" means the letter of credit facility established pursuant to Article III. "L/C Obligations" means at any time, an amount equal to the sum of (a) the aggregate undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit which have not then been reimbursed pursuant to Section 3.5. "L/C Participants" means the collective reference to all the Lenders with Revolving Credit Commitments other than the Issuing Lender. "Lender" means each Person executing this Agreement as a Lender (including, without limitation, the Issuing Lender and the Swingline Lender unless the context otherwise requires) set forth on the signature pages hereto and each Person that hereafter becomes a party to this Agreement as a Lender pursuant to Section 14.10. "Lending Office" means, with respect to any Lender, the office of such Lender maintaining such Lender's Revolving Credit Commitment Percentage or Term Loan Percentage, as applicable, of the Extensions of Credit. "Letters of Credit" shall have the meaning assigned thereto in Section 3.1. "LIBOR" means the rate of interest per annum determined on the basis of the rate for deposits in Dollars in an amount equal to the amount of the Loan requested by the Borrower for a period equal to the applicable Interest Period which appears on the Dow Jones Market Screen 3750 at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of the applicable Interest Period (rounded upward, if necessary, to the nearest 1/100th of 1%). If, for any reason, such rate does not appear on Dow Jones Market Screen 3750, then "LIBOR" shall be determined by the Administrative Agent to be the arithmetic average of the rate per annum at which deposits in Dollars in an amount equal to the amount of the Loan requested by the Borrower would be offered by first class banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of the applicable Interest Period for a period equal to such Interest Period. Each calculation by the Administrative Agent of LIBOR shall be conclusive and binding for all purposes, absent manifest error. "LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to the next higher 1/100th of 1%) determined by the Administrative Agent pursuant to the following formula: LIBOR Rate = LIBOR ------------------------------------------------- 1.00-Eurodollar Reserve Percentage "LIBOR Rate Loan" means any Loan bearing interest at a rate based upon the LIBOR Rate as provided in Section 5.1(a). "Lien" means, with respect to any asset, any mortgage, leasehold mortgage, lien, pledge, charge, security interest, hypothecation or encumbrance of any kind in respect of such asset. For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease or other title retention agreement relating to such asset. 9 "Loan Documents" means, collectively, this Agreement, the Notes, the Applications, the Security Documents, each Joinder Agreement and each other document, instrument, certificate and agreement executed and delivered by the Borrower or any Subsidiary thereof in connection with this Agreement (excluding any Hedging Agreement), all as may be amended, restated, supplemented or otherwise modified from time to time. "Loans" means the collective reference to the Revolving Credit Loans, the Term Loans and the Swingline Loans and "Loan" means any of such Loans. "Material Adverse Effect" means, with respect to the Borrower or any of its Restricted Subsidiaries, a material adverse effect on the properties, business, operations or condition (financial or otherwise) of any such Person or the ability of any such Person to perform its obligations under any Loan Document in each case to which it is a party. "Material Contract" means (a) any Material Government Contract or (b) any other contract or agreement, written or oral, of the Borrower or any of its Restricted Subsidiaries the failure to comply with which could reasonably be expected to have a Material Adverse Effect. "Material Government Contract" means any Government Contract which produces revenues to the Borrower or any Restricted Subsidiary in an amount in excess of $3,000,000 per annum. "Moody's" means Moody's Investors Service, Inc. "Mortgages" means the collective reference to each deed of trust, mortgage or other real property security document, encumbering all real property now or hereafter owned by the Borrower or any Restricted Domestic Subsidiary, in each case, in form and substance reasonably satisfactory to the Administrative Agent and executed by the Borrower or any Restricted Domestic Subsidiary thereof in favor of the Administrative Agent, for the ratable benefit of itself and the Lenders, as any such document may be amended, restated, supplemented or otherwise modified from time to time. "Multiemployer Plan" means a "multiemployer plan" as defined in Section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or is accruing an obligation to make, or has accrued an obligation to make contributions within the preceding six (6) years. "Net Cash Proceeds" means, as applicable, (a) with respect to any sale or other disposition of assets, the gross cash proceeds received by the Borrower or any of its Restricted Subsidiaries from such sale less the sum of (i) all income taxes and other taxes assessed by a Governmental Authority as a result of such sale and any other fees and expenses (including legal, brokerage, consulting and accounting fees and expenses) incurred in connection therewith and (ii) the principal amount of, premium, if any, and interest on any Debt secured by a Lien on the asset (or a portion thereof) sold, which Debt is required to be repaid in connection with such sale, (b) with respect to any offering of equity securities or issuance of Debt, the gross cash proceeds received by the Borrower or any of its Restricted Subsidiaries therefrom less all legal, underwriting and other fees and expenses incurred in connection therewith and (c) with respect to any payment under an insurance policy or in connection with a condemnation proceeding, the amount of cash proceeds received by the Borrower or its Restricted Subsidiaries from an insurance company or Governmental Authority, as applicable, net of all expenses of collection. "Net Income" means, with respect to the Borrower and its Subsidiaries, for any period of determination, the net income (or loss) for such period, determined on a Consolidated basis in accordance with GAAP; provided that there shall be excluded from Net Income (a) the net income (or loss) of any Person, in which the Borrower or any of its Restricted Subsidiaries has a joint interest with a third party, 10 except to the extent such net income is actually paid to the Borrower or any of its Restricted Subsidiaries by dividend or other distribution during such period (in an amount not to exceed the Borrower's or such Restricted Subsidiary's share (pro rata to its equity interest in such Person) of the net income of such Person), (b) the net income (or loss) of any Person accrued prior to the date it becomes a Subsidiary of such Person or is merged into or consolidated with such Person or any of its Restricted Subsidiaries or that Person's assets are acquired by such Person or any of its Restricted Subsidiaries except to the extent included pursuant to the foregoing clause (a), and (c) the net income of any Unrestricted Subsidiary, except to the extent such net income is actually paid to the Borrower or any of its Restricted Subsidiaries by dividend or distribution during such period (in an amount not to exceed the Borrower's or any Restricted Subsidiary's share (pro rata to its equity interest in such Unrestricted Subsidiary) of the net income of such Unrestricted Subsidiary). "Net Worth" means the shareholders' equity (including preferred stock) of the Borrower and its Restricted Subsidiaries determined on a Consolidated basis in accordance with GAAP. "Non-Recourse Project Financing Indebtedness" means any Indebtedness of a Restricted Subsidiary (the "Project Financing Subsidiary") incurred in connection with the acquisition, construction or development of any facility; (1) where such Project Financing Subsidiary operates or is responsible for the operation of the facility pursuant to a management services contract with a governmental entity; (2) as to which neither the Borrower nor any of its Restricted Subsidiaries, other than such Project Financing Subsidiary, (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), it being understood that equity investments funded at the time of or prior to the incurrence of such Indebtedness shall not be deemed credit support or (b) is directly or indirectly liable as a guarantor or otherwise; (3) where, upon the termination of the management services contract with respect to such facility, neither the Borrower nor any of its Restricted Subsidiaries, other than the Project Financing Subsidiary, will be liable, directly or indirectly, to make any payments with respect to such Indebtedness (or portions thereof); (4) the interest expense related to such Indebtedness is fully serviced by a separate corresponding payment with respect to such Indebtedness pursuant to an agreement with the governmental entity; and (5) such Project Financing Subsidiary has no assets other than the assets, including working capital, reasonably related to the design, construction, management and financing of the facility. "Notes" means the collective reference to the Revolving Credit Notes, the Term Notes and the Swingline Note, and "Note" means any of such Notes. "Notice of Account Designation" shall have the meaning assigned thereto in Section 2.3(b). "Notice of Borrowing" shall have the meaning assigned thereto in Section 2.3(a). "Notice of Conversion/Continuation" shall have the meaning assigned thereto in Section 5.2. "Notice of Prepayment" shall have the meaning assigned thereto in Section 2.4(c). 11 "Obligations" means, in each case, whether now in existence or hereafter arising: (a) the principal of and interest on (including interest accruing after the filing of any bankruptcy or similar petition) the Loans, (b) the L/C Obligations, (c) all existing or future payment and other obligations owing by the Borrower under any Hedging Agreement (which such Hedging Agreement is permitted hereunder) with any Person that is a Lender hereunder at the time such Hedging Agreement is executed (all such obligations with respect to any such Hedging Agreement, "Hedging Obligations") and (d) all other fees and commissions (including reasonable attorneys' fees), charges, indebtedness, loans, liabilities, financial accommodations, obligations, covenants and duties owing by the Borrower or any of its Subsidiaries to the Lenders or the Administrative Agent, in each case under or in respect of this Agreement, any Note, any Letter of Credit or any of the other Loan Documents of every kind, nature and description, direct or indirect, absolute or contingent, due or to become due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any note. "Officer's Compliance Certificate" shall have the meaning assigned thereto in Section 8.2. "Operating Lease" shall mean, as to any Person as determined in accordance with GAAP, any lease of property (whether real, personal or mixed) by such Person as lessee which is not a Capital Lease. "Other Taxes" shall have the meaning assigned thereto in Section 5.11(b). "Parent Shares" means the shares of capital stock of the Borrower held immediately prior to the Closing Date by G4 or an entity owned or controlled by G4. "Participating Member State" means each state so described in any EMU Legislation. "PBGC" means the Pension Benefit Guaranty Corporation or any successor agency. "PCG" means Premier Custodial Group Limited, a company organized under the laws of England, and its successors. "Pension Plan" means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is maintained for the employees of the Borrower or any ERISA Affiliates or (b) has at any time within the preceding six (6) years been maintained for the employees of the Borrower or any of its current or former ERISA Affiliates. "Permitted Acquisition" means an acquisition using that portion of (a) Net Cash Proceeds from the sale or other disposition of assets owned by the Borrower or any of its Restricted Subsidiaries or the offering of equity securities by the Borrower or any of its Restricted Subsidiaries and/or (b) Excess Cash Flow and/or cash on hand, in each case to the extent not required to be used to make prepayments pursuant to Section 4.4(b), provided that: (i) EBITDA for the two fiscal years immediately preceding the date of such acquisition, calculated on a pro forma basis as if the acquisition had been made on the first day of such period, would be positive, all as calculated by the Borrower in reasonable detail and reviewed and approved by the Administrative Agent, (ii) the Total Leverage Ratio and Senior Secured Leverage Ratio for the four most recently completed fiscal quarters for which financial statements are available, calculated on a pro forma basis as if the acquisition had been made on the first day of such period, would be at least 0.50 below the then applicable Total Leverage Ratio and Senior Secured Leverage Ratio, respectively, (iii) such acquisition shall be of at least a 50% ownership interest in a business or a line of business (whether by the acquisition of common stock, assets or any combination thereof) of any other Person that is in the same line of business as the business of the Borrower and its Restricted Subsidiaries on the Closing Date or a business reasonably related thereto or ancillary or incidental thereto or a 12 reasonable extension thereof, including the privatization of governmental services (a "Permitted Business"); and (iv) if any such acquisition (A) is in excess of $20,000,000 plus the Net Cash Proceeds from the offering of equity securities of the Borrower or any of its Restricted Subsidiaries not required to be used for prepayments under Section 4.4(b)(ii) (provided that such Net Cash Proceeds are designated for Permitted Acquisitions), or (B) when added to all such acquisitions made after the Closing Date, is in an aggregate amount in excess of $30,000,000 plus the Net Cash Proceeds from the offering of equity securities of the Borrower or any of its Restricted Subsidiaries not required to be used for prepayments under Section 4.4(b)(ii) (provided that such Net Cash Proceeds are designated for Permitted Acquisitions) (collectively, the "Permitted Acquisition Basket"), then such acquisition shall require the consent of the Required Lenders (provided that any acquisition to which the Required Lenders consent shall not be considered usage of the Permitted Acquisition Basket). "Permitted Business" shall have the meaning assigned thereto under the definition "Permitted Acquisition". "Permitted Currency" means Dollars or any Alternative Currency, or each such currency, as the context requires. "Person" means an individual, corporation, limited liability company, partnership, association, trust, business trust, joint venture, joint stock company, pool, syndicate, sole proprietorship, unincorporated organization, Governmental Authority or any other form of entity or group thereof. "PIK Preferred Stock" shall mean preferred stock or other junior securities of the Borrower that (a) require dividends or interest to be "paid-in-kind" by the issuance of like preferred stock or other junior securities and do not require cash dividends or interest to be paid, in each case, issued on terms and conditions acceptable to the Agents and (b) are not convertible or exchangeable into Debt or required to be redeemed or repurchased before the Term Loan Maturity Date. "Pounds Sterling" means, at any time of determination, the then official currency of the United Kingdom of Great Britain and Northern Ireland. "Prime Rate" means, at any time, the rate of interest per annum publicly announced from time to time by BNP Paribas as its prime rate. Each change in the Prime Rate shall be effective as of the opening of business on the day such change in such prime rate occurs. The parties hereto acknowledge that the rate announced publicly by BNP Paribas as its prime rate is an index or base rate and shall not necessarily be its lowest or best rate charged to its customers or other banks. "Purchasing Lender" shall have the meaning assigned thereto in Section 14.10(b). "Register" shall have the meaning assigned thereto in Section 14.10(d). "Reimbursement Obligation" means the obligation of the Borrower to reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit. "Rental Expense" means, with respect to the Borrower and its Restricted Subsidiaries for any period, all rent expense paid in cash with respect to long-term real property leases during such period, determined on a Consolidated basis in accordance with GAAP. "Required Lenders" means, at any date, any combination of Lenders whose Commitment Percentages aggregate more than fifty percent (50%) or, if the Credit Facility has been terminated 13 pursuant to Section 12.2, any combination of Lenders holding more than fifty percent (50%) of the aggregate Extensions of Credit. "Responsible Officer" means any of the following: the chief executive officer, chief financial officer or treasurer of the Borrower or any other officer of the Borrower designated by the chief executive officer, the chief financial officer or treasurer and reasonably acceptable to the Agents. "Restricted Payments" means (a) any direct or indirect distribution, dividend or other payment to any Person (other than to the Borrower or any of its Restricted Subsidiaries) on account of any capital stock or other ownership interests of the Borrower or any of its Subsidiaries (other than dividends payable solely in capital stock or other ownership interests of such Person and splits thereof), (b) the purchase, redemption, retirement or other acquisition, whether direct or indirect, of any shares of the Borrower's or its Restricted Subsidiaries' capital stock or other ownership interests, (c) any distribution of cash, property or assets among the holders of shares of the Borrower's or any of its Restricted Subsidiaries' capital stock or other ownership interests, (d) any cash interest payments with respect to Subordinated Debt, or (e) any change in the Borrower's or any Restricted Subsidiary's capital structure (except for any exchanges by the Borrower of common stock for PIK Preferred Stock with any of its existing stockholders; provided no Default or Event of Default is continuing or would result from such exchange). "Restricted Domestic Subsidiary" means any Domestic Subsidiary of the Borrower that is not an Unrestricted Subsidiary. "Restricted Foreign Subsidiary" means any Foreign Subsidiary of the Borrower that is not an Unrestricted Subsidiary. "Restricted Subsidiary" means any Subsidiary of the Borrower that is not an Unrestricted Subsidiary. "Revolving Credit Commitment" means (a) as to any Lender, the obligation of such Lender to make Revolving Credit Loans to the account of the Borrower hereunder in an aggregate principal amount at any time outstanding not to exceed the amount set forth in the Register, as such amount may be reduced or modified at any time or from time to time pursuant to the terms hereof and (b) as to all Lenders, the aggregate commitment of all Lenders to make Revolving Credit Loans, as such amount may be reduced at any time or from time to time pursuant to the terms hereof. The Revolving Credit Commitment of all Lenders on the Closing Date shall be $50,000,000. "Revolving Credit Commitment Percentage" means, as to any Lender at any time, the ratio of (a) the amount of the Revolving Credit Commitment of such Lender to (b) the Revolving Credit Commitments of all Lenders. "Revolving Credit Facility" means the revolving credit facility established pursuant to Article II. "Revolving Credit Loan" means any revolving loan made to the Borrower pursuant to Section 2.1, and all such revolving loans collectively as the context requires. "Revolving Credit Maturity Date" means the earliest of the dates referred to in Section 2.7. "Revolving Credit Notes" means the collective reference to the Revolving Credit Notes made by the Borrower payable to the order of each Lender holding a Revolving Credit Commitment, substantially in the form of Exhibit A-1 hereto, evidencing the Revolving Credit Facility, and any amendments, 14 supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part. "Securities Act" means the Securities Act of 1933, including all amendments thereto and regulations promulgated thereunder. "Security Documents" means the collective reference to the Guaranty Agreement, the Collateral Agreement, the Mortgages, the Collateral Assignment and each other agreement or writing pursuant to which the Borrower or any Restricted Subsidiary thereof purports to pledge or grant a security interest in any property or assets securing the Obligations or any such Person purports to guaranty the payment and/or performance of the Obligations, in each case, as amended, restated, supplemented or otherwise modified from time to time. "Senior Secured Leverage Ratio" shall have the meaning assigned thereto in Section 10.1(b). "Senior Unsecured Debt" means (a) the High-Yield Notes or (b) the $150,000,000 senior unsecured term loan made to the Borrower by BNP Paribas and other lenders on the Closing Date. "Share Purchase" means the purchase of 12,000,000 shares of common stock of the Borrower from G4 for a purchase price not to exceed $132,000,000. "Solvent" means, as to the Borrower and its Restricted Subsidiaries on a particular date, that any such Person (a) has capital sufficient to carry on its business and transactions and all business and transactions in which it is about to engage and is able to pay its debts as they mature, and (b) owns property having a value, both at fair valuation and at present fair saleable value, greater than the amount required to pay its probable liabilities (including contingencies). "South African Rand" means, at any time of determination, the then official currency of South Africa. "Subordinated Debt" means the collective reference to any Debt of the Borrower or any Restricted Subsidiary subordinated in right and time of payment to the Obligations and containing such other terms and conditions (including, without limitation, subordination terms), in each case as are satisfactory to the Required Lenders. "Subsidiary" means as to any Person, any corporation, partnership, limited liability company or other entity of which more than fifty percent (50%) of the outstanding capital stock or other ownership interests having ordinary voting power to elect a majority of the board of directors or other managers of such corporation, partnership, limited liability company or other entity is at the time owned by or the management is otherwise controlled directly or indirectly by such Person, or one or more of the Subsidiaries of such Person, or a combination thereof (irrespective of whether, at the time, capital stock or other ownership interests of any other class or classes of such corporation, partnership, limited liability company or other entity shall have or might have voting power by reason of the happening of any contingency). Unless otherwise qualified references to "Subsidiary" or "Subsidiaries" herein shall refer to those of the Borrower. "Survey Affidavit" shall have the meaning assigned thereto in Section 6.2(c). "Swingline Commitment" means the lesser of (a) Five Million Dollars ($5,000,000) and (b) the Revolving Credit Commitment. 15 "Swingline Facility" means the swingline facility established pursuant to Section 2.2. "Swingline Lender" means BNP Paribas in its capacity as swingline lender hereunder. "Swingline Loan" means any swingline loan made by the Swingline Lender to the Borrower pursuant to Section 2.2, and all such swingline loans collectively as the context requires. "Swingline Note" means the Swingline Note made by the Borrower payable to the order of the Swingline Lender, substantially in the form of Exhibit A-2 hereto, evidencing the Swingline Loans, and any amendments, supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extensions thereof, in whole or in part. "Swingline Termination Date" means the first to occur of (a) the resignation of BNP Paribas as Administrative Agent in accordance with Section 13.9 or (b) the Revolving Credit Maturity Date. "Syndication Agent" means BNP Paribas in its capacity as syndication agent hereunder. "Synthetic Lease" means any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing product where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an Operating Lease in accordance with GAAP. "S&P" means Standard & Poor's Rating Services, a division of The McGraw-Hill Companies. "Taxes" shall have the meaning assigned thereto in Section 5.11(a). "Term Loan Commitment" means (a) as to any Lender, the obligation of such Lender to extend the Term Loans to the account of the Borrower hereunder in an aggregate principal amount not to exceed the amount set forth in the Register, as such amount may be reduced or otherwise modified at any time or from time to time pursuant to the terms hereof and (b) as to all Lenders, the aggregate commitment to extend the Term Loans. The Term Loan Commitment of all Lenders as of the Closing Date shall be $100,000,000. "Term Loan Facility" shall mean the term loan facility established pursuant to Article IV. "Term Loan Maturity Date" means the first to occur of (a) July 9, 2009, or (b) the date of termination by the Administrative Agent on behalf of the Lenders pursuant to Section 12.2(a). "Term Loan Percentage" means, as to any Lender, the ratio of (a) the outstanding principal balance of the Term Loan of such Lender to (b) the aggregate outstanding principal balance of the Term Loans of all Lenders. "Term Loans" shall mean the term loans made to the Borrower by the Lenders pursuant to Section 4.1. "Term Notes" means the collective reference to the Term Notes made by the Borrower payable to the order of each Lender holding a Term Loan Commitment, substantially in the form of Exhibit A-3 hereto, evidencing the Term Loan Facility, and any amendments, modifications and supplements thereto, any substitute therefor, and any replacement, restatements, renewals or extensions thereof, in whole or in part. 16 "Termination Event" means except for any such event or condition that could not reasonably be expected to have a Material Adverse Effect: (a) a "Reportable Event" described in Section 4043 of ERISA for which the notice requirement has not been waived by the PBGC, or (b) the withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan during a plan year in which it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA, or (c) the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a termination, under Section 4041 of ERISA, if the plan assets are not sufficient to pay all plan liabilities, or (d) the institution of proceedings to terminate, or the appointment of a trustee with respect to, any Pension Plan by the PBGC, or (e) any other event or condition which would constitute grounds under Section 4042(a) of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan, or (f) the imposition of a Lien pursuant to Section 412 of the Code or Section 302 of ERISA, or (g) the partial or complete withdrawal of the Borrower of any ERISA Affiliate from a Multiemployer Plan if withdrawal liability is asserted by such plan, or (h) any event or condition which results in the reorganization or insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in the termination of a Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA. "Termination Value" means, in respect of any one or more Hedging Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Agreements, (a) for any date on or after the date such Hedging Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedging Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedging Agreements (which may include a Lender or any Affiliate of a Lender). "Total Leverage Ratio" shall have the meaning assigned thereto in Section 10.1(a). "Treaty on European Union" means the Treaty of Rome of March 25, 1957, as amended by the Single European Act of 1986 and the Maastricht Treaty (signed February 7, 1992), as amended from time to time. "UCC" means the Uniform Commercial Code as in effect in the State of New York, as amended or modified from time to time. "Uniform Customs" means the Uniform Customs and Practice for Documentary Credits (1993 Revision), effective January, 1994 International Chamber of Commerce Publication No. 500. "United States" means the United States of America. "Unrestricted Subsidiary" means any Subsidiary of the Borrower listed on Schedule 1.1(a) or which is designated as an Unrestricted Subsidiary after the Closing Date pursuant to Section 9.11, provided that (a) such Unrestricted Subsidiary's obligations are non-recourse to the Borrower and its Subsidiaries and (b) such Unrestricted Subsidiary meets the requirements set forth in Section 9.11. "Wholly-Owned" means, with respect to a Subsidiary, that all of the shares of capital stock or other ownership interests of such Subsidiary are, directly or indirectly, owned or controlled by the Borrower and/or one or more of its Wholly-Owned Subsidiaries (except for directors' qualifying shares or other shares required by Applicable Law to be owned by a Person other than the Borrower). 17 "WIH" means WCC International Holdings, Inc., a Delaware corporation, and its successors. SECTION 1.2 General. Unless otherwise specified, a reference in this Agreement to a particular article, section, subsection, Schedule or Exhibit is a reference to that article, section, subsection, Schedule or Exhibit of this Agreement. Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and plural, and pronouns stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter. Any reference herein to "New York time" shall refer to the applicable time of day in New York, New York. SECTION 1.3 Other Definitions and Provisions. (a) Use of Capitalized Terms. Unless otherwise defined therein, all capitalized terms defined in this Agreement shall have the defined meanings when used in this Agreement, the Notes and the other Loan Documents or any certificate, report or other document made or delivered pursuant to this Agreement. (b) Miscellaneous. The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. (c) Plural and Singular. The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms. SECTION 1.4 Effectiveness of Euro Provisions. With respect to any state (or the currency of such state) that is not a Participating Member State on the date of this Agreement, the provisions of Sections 3.8(a), 3.8(b) and 3.11 shall become effective in relation to such state (and the currency of such state) at and from the date on which such state becomes a Participating Member State. SECTION 1.5 Currency Equivalents. (a) For purposes of Articles II, III and IV, the applicable outstanding amount of Letters of Credit and L/C Obligations shall be deemed to refer to the Dollar Amount thereof. (b) All Loans made under this Agreement, including, without limitation, Loans made to refund drawings made under Alternative Currency Letters of Credit, shall be made only in Dollars. ARTICLE II REVOLVING CREDIT FACILITY SECTION 2.1 Revolving Credit Loans. Subject to the terms and conditions of this Agreement, and in reliance upon the representations and warranties set forth herein, each Lender severally agrees to make Revolving Credit Loans to the Borrower from time to time from the Closing Date through, but not including, the Revolving Credit Maturity Date as requested by the Borrower in accordance with the terms of Section 2.3; provided, that (a) the aggregate principal amount of all outstanding Revolving Credit Loans (after giving effect to any amount requested) shall not exceed the Revolving Credit Commitment less the sum of all outstanding Swingline Loans and L/C Obligations and (b) the principal amount of outstanding Revolving Credit Loans from any Lender to the Borrower shall not at any time exceed such Lender's Revolving Credit Commitment less such Lender's Revolving Credit Commitment Percentage of outstanding L/C Obligations and outstanding Swingline Loans. Each Revolving Credit Loan by a Lender shall be in a principal amount equal to such Lender's Revolving Credit Commitment Percentage of the 18 aggregate principal amount of Revolving Credit Loans requested on such occasion. Subject to the terms and conditions hereof, the Borrower may borrow, repay and reborrow Revolving Credit Loans hereunder until the Revolving Credit Maturity Date. SECTION 2.2 Swingline Loans. (a) Availability. Subject to the terms and conditions of this Agreement, the Swingline Lender agrees to make Swingline Loans to the Borrower from time to time from the Closing Date through, but not including, the Swingline Termination Date; provided, that the aggregate principal amount of all outstanding Swingline Loans (after giving effect to any amount requested), shall not exceed the lesser of (i) the Revolving Credit Commitment less the sum of all outstanding Revolving Credit Loans and the L/C Obligations and (ii) the Swingline Commitment. If the Swingline Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) at least one hour before the making of any Swingline Loan (A) directing the Swingline Lender not to make such Swingline Loan as a result of the limitations set forth in the proviso in Section 2.2(a), or (B) that one or more of the applicable conditions specified in Article VI is not then satisfied, then the Swingline Lender will not make such Swingline Loan. (b) Refunding. (i) Swingline Loans shall be refunded by the Lenders on demand by the Swingline Lender. Such refundings shall be made by the Lenders in accordance with their respective Revolving Credit Commitment Percentages and shall thereafter be reflected as Revolving Credit Loans of the Lenders on the books and records of the Administrative Agent. Each Lender shall fund its respective Revolving Credit Commitment Percentage of Revolving Credit Loans as required to repay Swingline Loans outstanding to the Swingline Lender upon demand by the Swingline Lender but in no event later than 2:00 p.m. (New York time) on the next succeeding Business Day after such demand is made. No Lender's obligation to fund its respective Revolving Credit Commitment Percentage of a Swingline Loan shall be affected by any other Lender's failure to fund its Revolving Credit Commitment Percentage of a Swingline Loan, nor shall any Lender's Revolving Credit Commitment Percentage be increased as a result of any such failure of any other Lender to fund its Revolving Credit Commitment Percentage of a Swingline Loan. (ii) The Borrower shall pay to the Swingline Lender on demand the amount of such Swingline Loans to the extent amounts received from the Lenders are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded. In addition, the Borrower hereby authorizes the Administrative Agent to charge any account maintained by the Borrower with the Swingline Lender (up to the amount available therein) in order to immediately pay the Swingline Lender the amount of such Swingline Loans to the extent amounts received from the Lenders are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded. If any portion of any such amount paid to the Swingline Lender shall be recovered by or on behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise, the loss of the amount so recovered shall be ratably shared among all the Lenders in accordance with their respective Revolving Credit Commitment Percentages (unless the amounts so recovered by or on behalf of the Borrower pertain to a Swingline Loan extended after the occurrence and during the continuance of an Event of Default of which the Administrative Agent has received notice in the manner required pursuant to Section 13.5 and which such Event of Default has not been waived by the Required Lenders or the Lenders, as applicable). (iii) Each Lender acknowledges and agrees that its obligation to refund Swingline Loans in accordance with the terms of this Section 2.2 is absolute and unconditional and shall not be affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions 19 set forth in Article VI. Further, each Lender agrees and acknowledges that if prior to the refunding of any outstanding Swingline Loans pursuant to this Section 2.2, one of the events described in Section 12.1(i) or (j) shall have occurred, each Lender will, on the date the applicable Revolving Credit Loan would have been made, purchase an undivided participating interest in the Swingline Loan to be refunded in an amount equal to its Revolving Credit Commitment Percentage of the aggregate amount of such Swingline Loan. Each Lender will immediately transfer to the Swingline Lender, in immediately available funds, the amount of its participation and upon receipt thereof the Swingline Lender will deliver to such Lender a certificate evidencing such participation dated the date of receipt of such funds and for such amount. Whenever, at any time after the Swingline Lender has received from any Lender such Lender's participating interest in a Swingline Loan, the Swingline Lender receives any payment on account thereof, the Swingline Lender will distribute to such Lender its participating interest in such amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender's participating interest was outstanding and funded). SECTION 2.3 Procedure for Advances of Revolving Credit Loans and Swingline Loans. (a) Requests for Borrowing. The Borrower shall give the Administrative Agent irrevocable prior written notice substantially in the form attached hereto as Exhibit B (a "Notice of Borrowing") not later than 1:00 p.m. (New York time) (i) on the same Business Day as each Base Rate Loan and each Swingline Loan and (ii) at least three (3) Business Days before each LIBOR Rate Loan, of its intention to borrow, specifying (A) the date of such borrowing, which shall be a Business Day, (B) the amount of such borrowing, which shall be, (x) with respect to Base Rate Loans (other than Swingline Loans) in an aggregate minimum principal amount of $1,000,000, (y) with respect to LIBOR Rate Loans in an aggregate minimum principal amount of $1,000,000 or, at the Borrower's option, if such borrowing is to be used to pay a principal installment due under Section 4.3, in an amount equal to the principal amount of such installment, and (z) with respect to Swingline Loans in an aggregate principal amount of $100,000 or a whole multiple of $100,000 in excess thereof, (C) whether such Loan is to be a Revolving Credit Loan or Swingline Loan, (D) in the case of a Revolving Credit Loan whether the Loans are to be LIBOR Rate Loans or Base Rate Loans, and (E) in the case of a LIBOR Rate Loan, the duration of the Interest Period applicable thereto. A Notice of Borrowing received after 1:00 p.m. (New York time) shall be deemed received on the next Business Day. The Administrative Agent shall promptly notify the Lenders of each Notice of Borrowing. (b) Disbursement of Revolving Credit and Swingline Loans. Not later than 2:00 p.m. (New York time) on the proposed borrowing date, (i) each Lender will make available to the Administrative Agent, for the account of the Borrower, at the office of the Administrative Agent in funds immediately available to the Administrative Agent, such Lender's Revolving Credit Commitment Percentage of the Revolving Credit Loans to be made on such borrowing date and (ii) the Swingline Lender will make available to the Administrative Agent, for the account of the Borrower, at the office of the Administrative Agent in funds immediately available to the Administrative Agent, the Swingline Loans to be made on such borrowing date. The Borrower hereby irrevocably authorizes the Administrative Agent to disburse the proceeds of each borrowing requested pursuant to this Section 2.3 in immediately available funds by crediting or wiring such proceeds to the deposit account of the Borrower identified in the most recent notice substantially in the form of Exhibit C hereto (a "Notice of Account Designation") delivered by the Borrower to the Administrative Agent or as may be otherwise agreed upon by the Borrower and the Administrative Agent from time to time. Subject to Section 5.7 hereof, the Administrative Agent shall not be obligated to disburse the portion of the proceeds of any Revolving Credit Loan requested pursuant to this Section 2.3 to the extent that any Lender has not made available to the Administrative Agent its Revolving Credit Commitment Percentage of such Loan. Revolving Credit Loans to be made for the purpose of refunding Swingline Loans shall be made as Base Rate Loans and shall be made by the Lenders as provided in Section 2.2(b). 20 SECTION 2.4 Repayment of Loans. (a) Repayment on Termination Date. The Borrower hereby agrees to repay the outstanding principal amount of (i) all Revolving Credit Loans in full on the Revolving Credit Maturity Date, and (ii) all Swingline Loans in accordance with Section 2.2(b), together, in each case, with all accrued but unpaid interest thereon. Any Swingline Loan not repaid prior to the Revolving Credit Maturity Date shall be repaid in full on such date. (b) Mandatory Repayment of Revolving Credit Loans. If at any time the outstanding principal amount of all Revolving Credit Loans plus the sum of all outstanding Swingline Loans and L/C Obligations exceeds the Revolving Credit Commitment, the Borrower agrees to repay immediately upon notice from the Administrative Agent, by payment to the Administrative Agent for the account of the Lenders, Extensions of Credit in an amount equal to such excess with each such repayment applied first to the principal amount of outstanding Swingline Loans, second to the principal amount of outstanding Revolving Credit Loans and third, with respect to any Letters of Credit then outstanding, a payment of cash collateral into a cash collateral account opened by the Administrative Agent, for the benefit of the Lenders in an amount up to the aggregate then undrawn and unexpired amount of such Letters of Credit (such cash collateral to be applied in accordance with Section 12.2(b)). (c) Optional Repayments. The Borrower may at any time and from time to time repay the Loans, in whole or in part, upon at least three (3) Business Days' irrevocable notice to the Administrative Agent with respect to LIBOR Rate Loans and on the same day of irrevocable notice with respect to Base Rate Loans and Swingline Loans, substantially in the form attached hereto as Exhibit D (a "Notice of Prepayment") specifying the date and amount of repayment and whether the repayment is of LIBOR Rate Loans, Base Rate Loans, Swingline Loans or a combination thereof, and, if of a combination thereof, the amount allocable to each. Upon receipt of such notice, the Administrative Agent shall promptly notify each Lender. If any such notice is given, the amount specified in such notice shall be due and payable on the date set forth in such notice. Partial repayments shall be in an aggregate minimum amount of $1,000,000 or a whole multiple of $1,000,000 in excess thereof with respect to Base Rate Loans (other than Swingline Loans), $2,500,000 with respect to LIBOR Rate Loans and $100,000 or a whole multiple of $100,000 in excess thereof with respect to Swingline Loans. Each such repayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof. (d) Limitation on Repayment of LIBOR Rate Loans. The Borrower may not repay any LIBOR Rate Loan on any day other than on the last day of the Interest Period applicable thereto unless such repayment is accompanied by any amount required to be paid pursuant to Section 5.9 hereof. (e) Hedging Agreements. No repayment or prepayment pursuant to this Section 2.4 shall affect any of the Borrower's obligations under any Hedging Agreement. SECTION 2.5 Notes. (a) Revolving Credit Notes. Except as otherwise provided in Section 14.10 (a)-(e), each Lender's Revolving Credit Loans and the obligation of the Borrower to repay such Revolving Credit Loans shall be evidenced by a separate Revolving Credit Note executed by the Borrower payable to the order of such Lender. (b) Swingline Note. The Swingline Loans and the obligation of the Borrower to repay such Swingline Loans shall be evidenced by a Swingline Note executed by the Borrower payable to the order of the Swingline Lender. 21 SECTION 2.6 Permanent Reduction of the Revolving Credit Commitment. (a) Voluntary Reduction. The Borrower shall have the right at any time and from time to time, upon at least five (5) Business Days prior written notice to the Administrative Agent, to permanently reduce, without premium or penalty, (i) the entire Revolving Credit Commitment at any time or (ii) portions of the Revolving Credit Commitment, from time to time, in an aggregate principal amount not less than $3,000,000 or any whole multiple of $1,000,000 in excess thereof. The amount of each partial permanent reduction shall permanently reduce the Lenders' Revolving Credit Commitments pro rata in accordance with their respective Revolving Credit Commitment Percentages. (b) Excess Proceeds. If at any time proceeds ("Excess Proceeds") remain after the prepayment in full of the Term Loans pursuant to Section 4.4(b), the Revolving Credit Commitment shall be permanently reduced on the date of the required prepayment under Section 4.4(b) by an amount equal to the amount of such Excess Proceeds; provided, however, if the balance of the Revolving Credit Commitments falls below the amount of any outstanding Letters of Credit, then such Excess Proceeds shall be used to cash collaterize such outstanding Letters of Credit to the extent of such deficiency. The amount of each such permanent reduction shall permanently reduce the Lenders' Revolving Credit Commitments pro rata in accordance with their respective Revolving Credit Commitment Percentages. (c) Corresponding Payment. Each permanent reduction permitted pursuant to this Section 2.6 shall be accompanied by a payment of principal sufficient to reduce the aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C Obligations, as applicable, after such reduction to the Revolving Credit Commitment as so reduced and if the Revolving Credit Commitment as so reduced is less than the aggregate amount of all outstanding Letters of Credit, the Borrower shall be required to deposit cash collateral in a cash collateral account opened by the Administrative Agent in an amount equal to the amount by which the aggregate face amount of all outstanding Letters of Credit exceeds the Revolving Credit Commitment as so reduced. Such cash collateral shall be applied in accordance with Section 12.2(b). Any reduction of the Revolving Credit Commitment to zero shall be accompanied by payment of all outstanding Revolving Credit Loans and Swingline Loans (and furnishing of cash collateral satisfactory to the Administrative Agent for all L/C Obligations) and shall result in the termination of the Revolving Credit Commitment and the Swingline Commitment and the Revolving Credit Facility. Such cash collateral shall be applied in accordance with Section 12.2(b). If the reduction of the Revolving Credit Commitment requires the repayment of any LIBOR Rate Loan, such repayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof. SECTION 2.7 Termination of Revolving Credit Facility. The Revolving Credit Facility shall terminate on the earliest of (a) July 9, 2008, (b) the date of termination by the Borrower pursuant to Section 2.6, or (c) the date of termination by the Administrative Agent on behalf of the Lenders pursuant to Section 12.2(a). ARTICLE III LETTER OF CREDIT FACILITY SECTION 3.1 L/C Commitment. Subject to the terms and conditions hereof, the Issuing Lender, in reliance on the agreements of the L/C Participants set forth in Section 3.4(a), agrees to issue standby letters of credit ("Letters of Credit") for the account of the Borrower on any Business Day from the Closing Date through but not including the date five (5) Business Days prior to the Revolving Credit Maturity Date in such form as may be approved from time to time by the Issuing Lender; provided, that the Issuing Lender shall have no obligation to issue any Letter of Credit if, after giving effect to such issuance, (a) the L/C Obligations would exceed the L/C Commitment or (b) the aggregate principal 22 amount of outstanding Revolving Credit Loans, plus the aggregate principal amount of outstanding Swingline Loans, plus the aggregate amount of L/C Obligations would exceed the Revolving Credit Commitment. Each Letter of Credit shall (i) be denominated in a Permitted Currency, (ii) be in a minimum amount of $25,000 (or the equivalent thereof in any Alternative Currency with respect to any Alternative Currency Letters of Credit), (iii) be a standby letter of credit issued to support obligations of the Borrower or any of its Subsidiaries, contingent or otherwise, incurred in the ordinary course of business, (iv) expire on a date satisfactory to the Issuing Lender, which date shall be no later than the earlier of (A) one (1) year after the date of its issuance or (B) five (5) Business Days prior to the Revolving Credit Maturity Date and (v) be subject to the Uniform Customs and/or ISP98, as set forth in the Application or as determined by the Issuing Lender and, to the extent not inconsistent therewith, the laws of the State of New York. The Issuing Lender shall not at any time be obligated to issue any Letter of Credit hereunder if such issuance would conflict with, or cause the Issuing Lender or any L/C Participant to exceed any limits imposed by, any Applicable Law. References herein to "issue" and derivations thereof with respect to Letters of Credit shall also include extensions or modifications of any existing Letters of Credit, unless the context otherwise requires. SECTION 3.2 Procedure for Issuance of Letters of Credit. The Borrower may from time to time request that the Issuing Lender issue a Letter of Credit by delivering to the Issuing Lender at the Issuing Lender's Lending Office an Application therefor, completed to the satisfaction of the Issuing Lender, and such other certificates, documents and other papers and information as the Issuing Lender may request (which information shall include the Permitted Currency in which the Letter of Credit shall be denominated). Upon receipt of any Application, the Issuing Lender shall process such Application and the certificates, documents and other papers and information delivered to it in connection therewith in accordance with its customary procedures and shall, subject to Section 3.1 and Article VI hereof, promptly issue the Letter of Credit requested thereby (but in no event shall the Issuing Lender be required to issue any Letter of Credit earlier than (a) three (3) Business Days, with respect to a Letter of Credit denominated in Dollars, and (b) four (4) Business Days, with respect to an Alternative Currency Letter of Credit, after its receipt of the Application therefor and all such other certificates, documents and other papers and information relating thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or as otherwise may be agreed by the Issuing Lender and the Borrower. The Issuing Lender shall promptly furnish to the Borrower a copy of such Letter of Credit and promptly notify each Lender of the issuance and upon request by any Lender, furnish to such Lender a copy of such Letter of Credit and the amount of such Lender's participation therein. If the Issuing Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) in sufficient time to permit the Issuing Lender, through the exercise of commercially reasonable efforts, to stop the issuance of any Letter of Credit requested by the Borrower (A) directing the Issuing Lender not to issue such Letter of Credit as a result of the limitations set forth in the proviso to the first sentence of Section 3.1(a), or (B) that one or more of the applicable conditions specified in Article VI is not then satisfied, then the Issuing Lender will not issue such Letter of Credit. SECTION 3.3 .Commissions and Other Charges. (a) The Borrower shall pay to the Administrative Agent, for the account of the Issuing Lender and the L/C Participants, a letter of credit commission with respect to each Letter of Credit in an amount equal to the face amount of such Letter of Credit (reflected as the Dollar Amount thereof, as determined by the Administrative Agent) multiplied by the Applicable Margin with respect to Revolving Credit Loans that are LIBOR Rate Loans (determined on a per annum basis). Such commission shall be payable quarterly in arrears on the last Business Day of each calendar quarter and on the Revolving Credit Maturity Date and shall be payable in Dollars based upon the Dollar Amount of such Letters of Credit for such quarter, as determined by the Administrative Agent. The Administrative Agent shall, promptly following its receipt thereof, distribute to the Issuing Lender and the L/C Participants all commissions 23 received pursuant to this Section 3.3(a) in accordance with their respective Revolving Credit Commitment Percentages. (b) In addition to the foregoing commission, the Borrower shall pay the Issuing Lender, for its own account, an issuance fee with respect to each Letter of Credit in an amount equal to the face amount of such Letter of Credit multiplied by one quarter of one percent (0.25%). Such issuance fee shall be payable upon issuance of each Letter of Credit and shall be payable in the Permitted Currency in which the applicable Letter of Credit is denominated. (c) In addition to the foregoing fees and commissions, the Borrower shall pay or reimburse the Issuing Lender, for its own account, for such normal and customary costs and expenses as are incurred or charged by the Issuing Lender in issuing, effecting payment under, amending or otherwise administering any Letter of Credit. Such costs and expenses shall be payable in the Permitted Currency in which the Letter of Credit is denominated. SECTION 3.4 L/C Participations. (a) The Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induce the Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from the Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant's own account and risk an undivided interest equal to such L/C Participant's Revolving Credit Commitment Percentage in the Issuing Lender's obligations and rights under and in respect of each Letter of Credit issued hereunder and the Dollar Amount of each draft paid by the Issuing Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees with the Issuing Lender that, if a draft is paid under any Letter of Credit for which the Issuing Lender is not reimbursed in full by the Borrower through a Revolving Credit Loan or otherwise in accordance with the terms of this Agreement, such L/C Participant shall pay to the Issuing Lender upon demand at the Issuing Lender's address for notices specified herein an amount equal to such L/C Participant's Revolving Credit Commitment Percentage of the Dollar Amount of such draft, or any part thereof, which is not so reimbursed. (b) Upon becoming aware of any amount required to be paid by any L/C Participant to the Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by the Issuing Lender under any Letter of Credit, the Issuing Lender shall notify each L/C Participant of the Dollar Amount and due date of such required payment and such L/C Participant shall pay to the Issuing Lender the Dollar Amount specified on the applicable due date. If any such amount is paid to the Issuing Lender after the date such payment is due, such L/C Participant shall pay to the Issuing Lender on demand, in addition to such amount, the product of (i) such amount, times (ii) the daily average Federal Funds Rate as determined by the Administrative Agent during the period from and including the date such payment is due to the date on which such payment is immediately available to the Issuing Lender, times (iii) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360. A certificate of the Issuing Lender with respect to any amounts owing under this Section 3.4(b) shall be conclusive in the absence of manifest error. With respect to payment to the Issuing Lender of the unreimbursed amounts described in this Section 3.4(b), if the L/C Participants receive notice that any such payment is due (A) prior to 1:00 p.m. (New York time) on any Business Day, such payment shall be due that Business Day, and (B) after 1:00 p.m. (New York time) on any Business Day, such payment shall be due on the following Business Day. (c) Whenever, at any time after the Issuing Lender has made payment under any Letter of Credit and has received from any L/C Participant its Revolving Credit Commitment Percentage of such payment in accordance with this Section 3.4, the Issuing Lender receives any payment related to such 24 Letter of Credit (whether directly from the Borrower or otherwise), or any payment of interest on account thereof, the Issuing Lender will distribute to such L/C Participant its pro rata share of the Dollar Amount thereof; provided, that in the event that any such payment received by the Issuing Lender shall be required to be returned by the Issuing Lender, such L/C Participant shall return to the Issuing Lender the portion thereof previously distributed by the Issuing Lender to it. (d) All payments made by any L/C Participant under this Section 3.4 shall be made in Dollars; provided that the Borrower shall be liable for any currency exchange loss pursuant to the terms of Section 3.10. SECTION 3.5 Reimbursement of Letter of Credit Drawings. (a) Reimbursement Obligation of the Borrower. In the event of any drawing under any Letter of Credit, the Borrower agrees to reimburse (either with the proceeds of a Revolving Credit Loan as provided for in this Section 3.5 or with funds from other sources), in same day funds in the applicable Permitted Currency in which such Letter of Credit was denominated, the Issuing Lender on each date on which the Issuing Lender notifies the Borrower of the date and amount of a draft paid under any Letter of Credit for the amount of (i) such draft so paid and (ii) any amounts referred to in Section 3.3(c) incurred by the Issuing Lender in connection with such payment (other then those payable pursuant to Section 3.5(c) below). (b) Reimbursement By the Lenders. Unless the Borrower shall immediately notify the Issuing Lender that the Borrower intends to reimburse the Issuing Lender for such drawing from other sources or funds, the Borrower shall be deemed to have timely given a Notice of Borrowing to the Administrative Agent requesting that the Lenders make a Revolving Credit Loan funded in Dollars bearing interest at the Base Rate on such date in the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by the Issuing Lender in connection with such payment (including, without limitation, any and all costs, fees and other expenses incurred by the Issuing Lender in effecting the payment of any Letter of Credit denominated in an Alternative Currency), and the Lenders shall make a Revolving Credit Loan funded in Dollars bearing interest at the Base Rate in such amount, the proceeds of which shall be applied to reimburse the Issuing Lender for the amount of the related drawing and costs and expenses. Each Lender acknowledges and agrees that its obligation to fund a Revolving Credit Loan in accordance with this Section 3.5 to reimburse the Issuing Lender for any draft paid under a Letter of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions set forth in Section 2.3(a) or Article VI. If the Borrower has elected to pay the amount of such drawing with funds from other sources and shall fail to reimburse the Issuing Lender as provided above, the unreimbursed amount of such drawing shall bear interest at the rate which would be payable on any outstanding Base Rate Loans which were then overdue from the date such amounts become payable (whether at stated maturity, by acceleration or otherwise) until payment in full. (c) Payment of Alternative Currency Letters of Credit. Each payment by the Borrower on account of any Alternative Currency Letter of Credit (including the Reimbursement Obligation with respect to any Alternative Currency Letter of Credit) shall be made in such Alternative Currency not later than 1:00 p.m. (local time at the office of the Issuing Lender's Correspondent) on the date specified for payment under this Agreement to the Administrative Agent's account with the Issuing Lender's Correspondent for the account of the Issuing Lender in immediately available funds, and shall be made without any set-off, counterclaim or deduction whatsoever. Any payment received after such time but before 2:00 p.m. (local time at the office of the Issuing Lender's Correspondent) on such day shall be deemed a payment on such date for the purposes of Section 12.1, but for all other purposes shall be deemed to have been made on the next succeeding Business Day. Any payment received after 2:00 p.m. 25 (the time of the Issuing Lender's Correspondent) shall be deemed to have been made on the next succeeding Business Day for all purposes. SECTION 3.6 Obligations Absolute. The Borrower's obligations under this Article III (including, without limitation, the Reimbursement Obligation) shall be absolute and unconditional under any and all circumstances and irrespective of any set-off, counterclaim or defense to payment which the Borrower may have or have had against the Issuing Lender or any beneficiary of a Letter of Credit or any other Person. The Borrower also agrees that the Issuing Lender and the L/C Participants shall not be responsible for, and the Borrower's Reimbursement Obligation under Section 3.5 shall not be affected by, among other things, the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee. The Issuing Lender shall not be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions caused by the Issuing Lender's gross negligence or willful misconduct. The Borrower agrees that any action taken or omitted by the Issuing Lender under or in connection with any Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or willful misconduct, shall be binding on the Borrower and shall not result in any liability of the Issuing Lender or any L/C Participant to the Borrower. The responsibility of the Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to any payment obligation expressly provided for in such Letter of Credit, be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment are in conformity with such Letter of Credit. SECTION 3.7 Excess L/C Obligations. If at any time (as determined by the Administrative Agent pursuant to this Section 3.7) and because of currency fluctuations or for any other reason, based upon the Dollar Amount of all outstanding Loans and L/C Obligations, the outstanding amount of all L/C Obligations exceeds the lesser of (a) the Aggregate Commitment less the sum of the amount of all outstanding Loans and (b) the L/C Commitment, then, in each such case, the Borrower shall, at its option, either (i) repay Loans in an amount equal to such excess (to the extent such repayment will eliminate such excess) or (ii) make a payment of cash collateral into a cash collateral account opened by the Administrative Agent for the benefit of the Lenders in an amount equal to such excess (such cash collateral to be applied in accordance with Section 12.2(b)). The Borrower's compliance with this Section 3.7 shall be tested from time to time by the Administrative Agent at its sole discretion, but in any event shall be tested on (x) the date on which the Borrower requests the Lenders to make a Loan or requests the Issuing Lender to issue a Letter of Credit under Section 6.3 and (y) the date an interest payment is due under Section 5.1(e). Each such repayment pursuant to this Section 3.7 shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof. SECTION 3.8 Redenomination under EMU. (a) Redenomination of Letters of Credit. Subject to Section 1.4 hereof, any Letter of Credit to be denominated in the currency of the applicable Participating Member State shall be made in the euro. (b) Redenomination of Obligations. Subject to Section 1.4 hereof, any obligation of any party under this Agreement or any other Loan Document which has been denominated in the currency of a Participating Member State shall be redenominated into the euro. (c) Further Assurances. The terms and provisions of this Agreement will be subject to such reasonable changes of construction as determined by the Administrative Agent to reflect the 26 implementation of the EMU in any Participating Member State or any market conventions relating to the fixing and/or calculation of interest being changed or replaced and to reflect market practice at that time, and subject thereto, to put the Administrative Agent, the Lenders and the Borrower in the same position, so far as possible, that they would have been if such implementation had not occurred. In connection therewith, the Borrowers agree, at the request of the Administrative Agent, at the time of or at any time following the implementation of the EMU in any Participating Member State or any market conventions relating to the fixing and/or calculation of interest being changed or replaced, to enter into an agreement amending this Agreement in such manner as the Administrative Agent shall reasonably request. SECTION 3.9 Regulatory Limitation. In the event, as a result of increases in the value of Alternative Currencies against the Dollar or for any other reason, the obligation of the Issuing Lender to issue Alternative Currency Letters of Credit (taking into account the Dollar Amount of the Obligations and all other indebtedness required to be aggregated under 12 U.S.C.A. Section 84, as amended, the regulations promulgated thereunder and any other Applicable Law) is determined by the Issuing Lender to exceed its then applicable legal lending limit under 12 U.S.C.A. Section 84, as amended, and the regulations promulgated thereunder, or any other Applicable Law, the amount of additional Alternative Currency Letters of Credit the Issuing Lenders shall be obligated to issue hereunder shall immediately be reduced to the maximum amount which the Issuing Lender may legally advance (as determined by the Issuing Lender) and, to the extent necessary under such laws and regulations (as determined by the Issuing Lender, with respect to the applicability of such laws and regulations to itself), the Borrower shall reduce, or cause to be reduced, complying to the extent practicable with the remaining provisions hereof, the Obligations outstanding hereunder by an amount sufficient to comply with such maximum amounts. SECTION 3.10 Exchange Indemnification and Increased Costs. The Borrower shall, upon demand from the Issuing Lender or any L/C Participant, pay to the Issuing Lender or such L/C Participant, the amount of (a) any loss or cost or increased cost incurred by the Issuing Lender or such L/C Participant, (b) any reduction in any amount payable to or in the effective return on the capital to the Issuing Lender or such L/C Participant, (c) any interest or any other return, including principal, foregone by the Issuing Lender as a result of the introduction of, change over to or operation of the euro or (d) any currency exchange loss, in each case that the Issuing Lender or such L/C Participant sustains as a result of the Borrower's or any L/C Participant's repayment in Dollars of any Alternative Currency Letter of Credit. A certificate of the Issuing Lender setting forth in reasonable detail the basis for determining such additional amount or amounts necessary to compensate the Issuing Lender shall be conclusively presumed to be correct save for manifest error. SECTION 3.11 Rounding and Other Consequential Changes. Subject to Section 1.4 hereof, without prejudice and in addition to any method of conversion or rounding prescribed by any EMU Legislation and without prejudice to the respective obligations of the Borrower to the Administrative Agent and the Lenders and the Administrative Agent and the Lenders to the Borrower under or pursuant to this Agreement, except as expressly provided in this Agreement, each provision of this Agreement, including, without limitation, the right to combine currencies to effect a set-off, shall be subject to such reasonable changes of interpretation as the Administrative Agent may from time to time specify to be necessary or appropriate to reflect the introduction of or change over to the euro in Participating Member States. SECTION 3.12 Effect of Application. To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Article III, the provisions of this Article III shall apply. 27 ARTICLE IV TERM LOAN FACILITY SECTION 4.1 Term Loan. The Term Loan was advanced to the Borrower on December 12, 2002 pursuant to the Existing Facility. After giving effect to the repayment of the Term Loan on or before the Closing Date so that the outstanding Term Loan equals $100,000,000, the outstanding Term Loan shall have been funded by each Lender in a principal amount equal to such Lender's Term Loan Commitment on the Closing Date, which aggregate principal amount shall equal the total Term Loan Commitment as of the Closing Date. SECTION 4.2 Procedure for Advance of Term Loan. [This section intentionally left blank.] SECTION 4.3 Repayment of Term Loan. The Borrower shall repay the aggregate outstanding principal amount of the Term Loan in consecutive quarterly installments on the last Business Day of each three month period specified below, commencing October 31, 2003, and on the Term Loan Maturity Date, as set forth below, except as the amounts of individual installments may be adjusted pursuant to Section 4.4 hereof:

PRINCIPAL THREE MONTH PERIOD INSTALLMENT YEAR ENDING ($) - ------------------------------------------------------------------------- 2003 October 31 1,250,000 - ------------------------------------------------------------------------ 2004 January 31 1,250,000 - ------------------------------------------------------------------------ April 30 1,250,000 ---------------------------------------------------- July 31 1,250,000 ---------------------------------------------------- October 31 1,875,000 - --------------------------------------------------------------------- 2005 January 31 1,875,000 ---------------------------------------------------- April 30 1,875,000 ---------------------------------------------------- July 31 1,875,000 ---------------------------------------------------- October 31 1,875,000 - --------------------------------------------------------------------- 2006 January 31 1,875,000 ---------------------------------------------------- April 30 1,875,000 ---------------------------------------------------- July 31 1,875,000 ---------------------------------------------------- October 31 1,875,000 - --------------------------------------------------------------------- 2007 January 31 1,875,000 ---------------------------------------------------- April 30 1,875,000 ---------------------------------------------------- July 31 1,875,000 ---------------------------------------------------- October 31 1,875,000 - ------------------------------------------------------------------------ 2008 January 31 1,875,000 ---------------------------------------------------- April 30 1,875,000 ---------------------------------------------------- July 31 1,875,000 ---------------------------------------------------- October 31 16,250,000 - --------------------------------------------------------------------- 2009 January 31 16,250,000 ---------------------------------------------------- April 30 16,250,000 - --------------------------------------------------------------------- Term Loan Maturity Date $16,250,000 - ------------------------------------------------------------------------

If not sooner paid, the Term Loan shall be paid in full, together with accrued interest thereon, on the Term Loan Maturity Date. Amounts repaid under the Term Loan pursuant to this Section 4.3 may not be reborrowed. 28 SECTION 4.4 Prepayments of Term Loan. (a) Optional Prepayment of Term Loan. The Borrower shall have the right at any time and from time to time, upon delivery to the Administrative Agent of a Notice of Prepayment at least three (3) Business Days prior to any repayment, to prepay the Term Loan in whole or in part without premium or penalty except as provided in Section 5.9. Each optional prepayment of the Term Loan hereunder shall be in an aggregate principal amount of at least $5,000,000 and shall be applied to the outstanding principal installments of the Term Loan in inverse order of maturity thereof. Each repayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof. (b) Mandatory Prepayment of Loans. (i) Debt Proceeds. The Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi) below in amounts equal to one hundred percent (100%) of the aggregate Net Cash Proceeds from any incurrence of Debt (other than Debt permitted pursuant to Section 11.1 or otherwise permitted by the Required Lenders) by the Borrower or any of its Restricted Subsidiaries. Such prepayment shall be made within three (3) Business Days after the date of receipt of Net Cash Proceeds of any such transaction. (ii) Equity Proceeds. The Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi) below in amounts equal to fifty percent (50%) of the aggregate Net Cash Proceeds from any offering of equity securities by the Borrower or any of its Restricted Subsidiaries, other than Net Cash Proceeds resulting solely from (A) offerings of equity securities made in connection with any employee stock option, incentive plan or stock purchase plan or made in connection with compensation or incentive plans for directors and officers, in each case, entered into in the ordinary course of business and (B) an offering of PIK Preferred Stock; provided that (x) the Borrower may retain the first $100,000,000 of the Net Cash Proceeds raised in such offerings of equity securities within the first twelve months of the Closing Date, subject to such Net Cash Proceeds being reinvested in Permitted Acquisitions or in other revenue producing assets related to a Permitted Business within two hundred seventy (270) days of such offering and (y) no Default or Event of Default is continuing or would result from such offering. Such prepayment shall be made within three (3) Business Days after the date of receipt of Net Cash Proceeds of any such transaction. (iii) Asset Sale Proceeds. To the extent permitted by Applicable Law, no later than two hundred seventy (270) days following the Borrower's or applicable Restricted Subsidiary's receipt thereof, the Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi) below in amounts equal to (x) one hundred percent (100%) of the aggregate Net Cash Proceeds from the sale or other disposition or series of related sales or other dispositions of assets by the Borrower or any of its Subsidiaries permitted pursuant to Section 11.5(f) or otherwise permitted by the Required Lenders (y) fifty percent (50%) of the aggregate Net Cash Proceeds from the sale or other disposition or series of related sales or other dispositions by the Borrower of those assets listed on Schedule 4.4(b)(iii), provided that the remaining balance of such Net Cash Proceeds have been reinvested in Permitted Acquisitions or in other revenue producing assets related to a Permitted Business within two hundred seventy (270) days after receipt of such Net Cash Proceeds, and (z) zero (0%) of the Net Cash Proceeds from the sale or other disposition or series of related sales or other dispositions by the Borrower of its ownership interests in PCG, provided that such Net Cash Proceeds have been reinvested in Permitted Acquisitions or in other revenue producing assets related to a Permitted Business within two hundred seventy (270) days after the receipt thereof. If Net Cash Proceeds are not reinvested by the date which is two hundred seventy (270) days following the Borrower's or Restricted Subsidiary's receipt thereof the Borrower shall make a mandatory prepayment in an amount equal to such Net Cash Proceeds as described above on such date. Notwithstanding any of the foregoing to the contrary, upon and during 29 the continuance of an Event of Default and upon notice from the Administrative Agent, all Net Cash Proceeds from the sale or other disposition or series of related sales or other dispositions of assets by the Borrower or any of its Restricted Subsidiaries, received by the Borrower and its Restricted Subsidiaries shall be applied to make prepayments of the Loans pursuant to Section 4.4(b)(vi), such prepayments to be made within three (3) Business Days after the Borrower's or such Restricted Subsidiary's receipt of such Net Cash Proceeds. (iv) Insurance and Condemnation Proceeds. No later than one hundred eighty (180) days following the date of receipt by the Borrower or any of its Restricted Subsidiaries of any Net Cash Proceeds under any of the insurance policies maintained pursuant to Section 9.3 or from any condemnation proceeding (the "Insurance and Condemnation Proceeds") which have not been reinvested as of such date in similar replacement assets, the Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi) below in amounts equal to one hundred percent (100%) of the aggregate amount of such Insurance and Condemnation Proceeds received by the Borrower or any of its Restricted Subsidiaries. Notwithstanding any of the foregoing to the contrary, upon and during the continuance of an Event of Default and upon notice from the Administrative Agent, all Insurance and Condemnation Proceeds, received by the Borrower and its Subsidiaries shall be applied to make prepayments of the Loans, such prepayments to be made within three (3) Business Days after the Borrower's or such Restricted Subsidiary's receipt of such Insurance and Condemnation Proceeds. (v) Excess Cash Flow. No later than one hundred and twenty five (125) days after the end of any Fiscal Year commencing with the Fiscal Year ending December 28, 2003, if at any Fiscal Year end the Total Leverage Ratio exceeds 1.50 to 1.00, the Borrower shall make a mandatory principal repayment of the Loans in an amount equal to fifty percent (50%) of Excess Cash Flow, if any, for such Fiscal Year. Notwithstanding the foregoing, Excess Cash Flow computed for the Fiscal Year ending December 28, 2003 shall be for the period from July 1, 2003 through December 28, 2003. (vi) Notice; Manner of Payment. (A) Upon the occurrence of any event triggering the prepayment requirement under Sections 4.4(b)(i) through and including 4.4(b)(iv), the Borrower shall promptly deliver a Notice of Prepayment to the Administrative Agent and upon receipt of such notice, the Administrative Agent shall promptly so notify the Lenders. (B) Each prepayment under this Section 4.4(b) shall be applied as follows: (i) first, to reduce on a pro rata basis the remaining scheduled principal installments of the Term Loans pursuant to Section 4.3 and (ii) second, to the extent of any excess, to reduce permanently the Revolving Credit Commitment pursuant to Section 2.6(b) provided, that each Lender shall have the right, so long as there are outstandings under the Revolving Credit Facility, to refuse any such mandatory prepayment of the Term Loans, at which time the full amount of any such refused payments shall be applied to repay outstanding Revolving Credit Loans without a corresponding reduction of the Revolving Credit Commitment. (C) Amounts prepaid under the Term Loan pursuant to this Section 4.4 may not be reborrowed and will constitute a permanent reduction in such Term Loan Commitment. Each prepayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof. SECTION 4.5 Term Notes. Except as otherwise provided in Section 14.10(a)-(e), each Lender's Term Loan and the obligation of the Borrower to repay such Term Loan shall be evidenced by a separate Term Note executed by the Borrower payable to the order of such Lender. 30 ARTICLE V GENERAL LOAN PROVISIONS SECTION 5.1 Interest. (a) Interest Rate Options. Subject to the provisions of this Section 5.1, at the election of the Borrower, (i) Revolving Credit Loans and Term Loans shall bear interest at (A) the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the Applicable Margin and (ii) Swingline Loans shall bear interest at the Base Rate plus the Applicable Margin. The Borrower shall select the rate of interest and Interest Period, if any, applicable to any Loan at the time a Notice of Borrowing is given pursuant to Section 2.3 or Section 4.2, as applicable, or at the time a Notice of Conversion/Continuation is given pursuant to Section 5.2. Any Loan or any portion thereof as to which the Borrower has not duly specified an interest rate as provided herein shall be deemed a Base Rate Loan. (b) Interest Periods. In connection with each LIBOR Rate Loan, the Borrower, by giving notice at the times described in Section 5.1(a), shall elect an interest period (each, an "Interest Period") to be applicable to such Loan, which Interest Period shall be a period of one (1), two (2), three (3), or six (6) months with respect to each LIBOR Rate Loan; provided that: (i) the Interest Period shall commence on the date of advance of or conversion to any LIBOR Rate Loan and, in the case of immediately successive Interest Periods, each successive Interest Period shall commence on the date on which the immediately preceding Interest Period expires; (ii) if any Interest Period would otherwise expire on a day that is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, that if any Interest Period with respect to a LIBOR Rate Loan would otherwise expire on a day that is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the immediately preceding Business Day; (iii) any Interest Period with respect to a LIBOR Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the relevant calendar month at the end of such Interest Period; (iv) no Interest Period shall extend beyond the Revolving Credit Maturity Date or the Term Loan Maturity Date, as applicable, and Interest Periods shall be selected by the Borrower so as to permit the Borrower to make the quarterly principal installment payments pursuant to Section 4.3 without payment of any amounts pursuant to Section 5.9; and (v) there shall be no more than six (6) Interest Periods in effect at any time. (c) Applicable Margin. The Applicable Margin provided for in Section 5.1(a) with respect to any Loan (the "Applicable Margin") shall be based upon the table set forth below and shall be determined and adjusted quarterly on the date (each a "Calculation Date") ten (10) Business Days after the date by which the Borrower is required to provide an Officer's Compliance Certificate for the most recently ended fiscal quarter of the Borrower; provided, however, that (a) the initial Applicable Margin shall be based on Pricing Level III (as shown below) and shall remain at Pricing Level III until receipt by the Administrative Agent of the Officer's Compliance Certificate for the period ended December 28, 2003 and, thereafter the Pricing Level shall be determined by reference to the Total Leverage Ratio as of the last day of the most recently ended fiscal quarter of the Borrower preceding the applicable Calculation 31 Date, and (b) if the Borrower fails to provide the Officer's Compliance Certificate as required by Section 8.2 for the most recently ended fiscal quarter of the Borrower preceding the applicable Calculation Date, the Applicable Margin from such Calculation Date shall be based on Pricing Level IV (as shown below) until such time as an appropriate Officer's Compliance Certificate is provided, at which time the Pricing Level shall be determined by reference to the Total Leverage Ratio as of the last day of the most recently ended fiscal quarter of the Borrower preceding such Calculation Date. The Applicable Margin shall be effective from one Calculation Date until the next Calculation Date. Any adjustment in the Applicable Margin shall be applicable to all Extensions of Credit then existing or subsequently made or issued.

REVOLVING CREDIT LOANS TERM LOANS - ----------------------------------------------------------------------------------------------------------- PRICING LEVEL TOTAL LEVERAGE RATIO LIBOR BASE RATE LIBOR BASE RATE - ----------------------------------------------------------------------------------------------------------- IV Greater than 3.00 to 1.00 3.25% 2.00% 3.00% 1.75% - -------------------------------------------------------------------------------------------------------- III Greater than 2.50 to 1.00, but 3.00% 1.75% 3.00% 1.75% less than or equal to 3.00 to 1.00 - -------------------------------------------------------------------------------------------------------- II Greater than 2.00 to 1.00, but 2.75% 1.50% 3.00% 1.75% less than or equal to 2.50 to 1.00 - -------------------------------------------------------------------------------------------------------- I Less than or equal to 2.00 2.50% 1.25% 3.00% 1.75% - --------------------------------------------------------------------------------------------------------

(d) Default Rate. Subject to Section 12.3, at the discretion of the Administrative Agent or as directed by the Required Lenders, upon the occurrence and during the continuance of an Event of Default, (i) the Borrower shall no longer have the option to request the conversion of any outstanding Loans to, or the continuation of any outstanding Loan as, LIBOR Rate Loans, (ii) all outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two percent (2%) in excess of the rate then applicable to LIBOR Rate Loans until the end of the applicable Interest Period and thereafter at a rate equal to two percent (2%) in excess of the rate then applicable to Base Rate Loans, and (iii) all outstanding Base Rate Loans and other Obligations arising hereunder or under any other Loan Document shall bear interest at a rate per annum equal to two percent (2%) in excess of the rate then applicable to Base Rate Loans or such other Obligations arising hereunder or under any other Loan Document. Interest shall continue to accrue on the Notes after the filing by or against the Borrower of any petition seeking any relief in bankruptcy or under any act or law pertaining to insolvency or debtor relief, whether state, federal or foreign. (e) Interest Payment and Computation. Interest on each Base Rate Loan shall be payable in arrears on the last Business Day of each consecutive three month period ending October 31, January 31, April 30 and July 31 during the term of this Agreement, commencing October 31, 2003; and interest on each LIBOR Rate Loan shall be payable on the last day of each Interest Period applicable thereto, and if such Interest Period is longer than three (3) months, at the end of each three (3) month interval during such Interest Period. Interest on LIBOR Rate Loans and all fees payable hereunder shall be computed on the basis of a 360-day year and assessed for the actual number of days elapsed and interest on Base Rate Loans shall be computed on the basis of a 365/366-day year and assessed for the actual number of days elapsed. (f) Maximum Rate. In no contingency or event whatsoever shall the aggregate of all amounts deemed interest hereunder or under any of the Notes charged or collected pursuant to the terms of this Agreement or pursuant to any of the Notes exceed the highest rate permissible under any Applicable Law which a court of competent jurisdiction shall, in a final determination, deem applicable 32 hereto. In the event that such a court determines that the Lenders have charged or received interest hereunder in excess of the highest applicable rate, the rate in effect hereunder shall automatically be reduced to the maximum rate permitted by Applicable Law and the Lenders shall at the Administrative Agent's option (i) promptly refund to the Borrower any interest received by the Lenders in excess of the maximum lawful rate or (ii) apply such excess to the principal balance of the Obligations on a pro rata basis. It is the intent hereof that the Borrower not pay or contract to pay, and that neither the Administrative Agent nor any Lender receive or contract to receive, directly or indirectly in any manner whatsoever, interest in excess of that which may be paid by the Borrower under Applicable Law. SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans. Provided that no Default or Event of Default has occurred and is then continuing, the Borrower shall have the option to (a) convert at any time following the third Business Day after the Closing Date all or any portion of any outstanding Base Rate Loans (other than Swingline Loans) in a minimum principal amount equal to $2,500,000 into one or more LIBOR Rate Loans and (b) upon the expiration of any Interest Period, (i) convert all or any part of its outstanding LIBOR Rate Loans in a minimum principal amount equal to $1,000,000 into Base Rate Loans (other than Swingline Loans) or (ii) continue such LIBOR Rate Loans as LIBOR Rate Loans. Whenever the Borrower desires to convert or continue Loans as provided above, the Borrower shall give the Administrative Agent irrevocable prior written notice in the form attached as Exhibit E (a "Notice of Conversion/Continuation") not later than 1:00 p.m. (New York time) three (3) Business Days before the day on which a proposed conversion or continuation of such Loan is to be effective specifying (A) the Loans to be converted or continued, and, in the case of any LIBOR Rate Loan to be converted or continued, the last day of the Interest Period therefor, (B) the effective date of such conversion or continuation (which shall be a Business Day), (C) the principal amount of such Loans to be converted or continued, and (D) the Interest Period to be applicable to such converted or continued LIBOR Rate Loan. The Administrative Agent shall promptly notify the Lenders of such Notice of Conversion/Continuation. SECTION 5.3 Fees. (a) Commitment Fee. Commencing on the Closing Date, the Borrower shall pay to the Administrative Agent, for the account of the Lenders, a non-refundable commitment fee at a rate per annum equal to 0.50% on the average daily unused portion of the Revolving Credit Commitment; provided that the amount of outstanding Swingline Loans shall not be considered usage of the Revolving Credit Commitment for the purpose of calculating such commitment fee. The commitment fee shall be payable in arrears on the last Business Day of each consecutive three month period ending October 31, January 31, April 30 and July 31 during the term of this Agreement commencing October 31, 2003 and on the Revolving Credit Maturity Date. Such commitment fee shall be distributed by the Administrative Agent to the Lenders pro rata in accordance with the Lenders' respective Revolving Credit Commitment Percentages. (b) Administrative Agent's and Other Fees. In order to compensate the Administrative Agent for structuring and syndicating the Loans and for its obligations hereunder, the Borrower agrees to pay to the Administrative Agent, for its account, the fees set forth in the separate fee letter agreement executed by the Borrower and the Administrative Agent dated April 30, 2003, as amended. SECTION 5.4 Manner of Payment. Each payment by the Borrower on account of the principal of or interest on the Loans or of any fee, commission or other amounts (including the Reimbursement Obligation) payable to the Lenders under this Agreement or any Note shall be made not later than 1:00 p.m. (New York time) on the date specified for payment under this Agreement to the Administrative Agent at the Administrative Agent's Office for the account of the Lenders (other than as set forth below) pro rata in accordance with their respective Revolving Credit Commitment Percentages or Term Loan 33 Percentages, as applicable, (except as specified below), in Dollars, in immediately available funds and shall be made without any set-off, counterclaim or deduction whatsoever. Any payment received after such time but before 2:00 p.m. (New York time) on such day shall be deemed a payment on such date for the purposes of Section 12.1, but for all other purposes shall be deemed to have been made on the next succeeding Business Day. Any payment received after 2:00 p.m. (New York time) shall be deemed to have been made on the next succeeding Business Day for all purposes. Upon receipt by the Administrative Agent of each such payment, the Administrative Agent shall distribute to each Lender at its address for notices set forth herein its pro rata share of such payment in accordance with such Lender's Revolving Credit Commitment Percentage or Term Loan Percentage, as applicable, (except as specified below) and shall wire advice of the amount of such credit to each Lender. Each payment to the Administrative Agent of the Issuing Lender's fees or L/C Participants' commissions shall be made in like manner, but for the account of the Issuing Lender or the L/C Participants, as the case may be. Each payment to the Administrative Agent of Administrative Agent's fees or expenses shall be made for the account of the Administrative Agent and any amount payable to any Lender under Sections 5.8, 5.9, 5.10, 5.11 or 14.2 shall be paid to the Administrative Agent for the account of the applicable Lender. Subject to Section 5.1(b)(ii) if any payment under this Agreement or any Note shall be specified to be made upon a day which is not a Business Day, it shall be made on the next succeeding day which is a Business Day and such extension of time shall in such case be included in computing any interest if payable along with such payment. SECTION 5.5 Crediting of Payments and Proceeds. In the event that the Borrower shall fail to pay any of the Obligations when due and the Obligations have been accelerated pursuant to Section 12.2, all payments received by the Lenders upon the Notes and the other Obligations and all net proceeds from the enforcement of the Obligations shall be applied: (a) first to all expenses then due and payable by the Borrower hereunder and under the other Loan Documents, (b) then to all indemnity obligations then due and payable by the Borrower hereunder and under the other Loan Documents, (c) then to all of the Administrative Agent's and Issuing Lender's fees then due and payable, (d) then to all commitment and other fees and commissions then due and payable, (e) then to accrued and unpaid interest on the Notes, accrued and unpaid interest on the Reimbursement Obligation and accrued and unpaid periodic payments or interest (but not any settlement amounts) payable under any Hedging Obligations (pro rata in accordance with all such amounts due), (f) then to the principal amount of the Notes and Reimbursement Obligation and any settlement amounts payable under any Hedging Obligations (pro rata in accordance with all such amounts due) and (g) then to the cash collateral account described in Section 12.2(b) hereof to the extent of any L/C Obligations then outstanding, in that order. SECTION 5.6 Adjustments. If any Lender (a "Benefited Lender") shall at any time receive any payment of all or part of the Obligations owing to it, or interest thereon, or if any Lender shall at any time receive any collateral in respect to the Obligations owing to it (whether voluntarily or involuntarily, by set-off or otherwise) (other than pursuant to Sections 5.8, 5.9, 5.10, 5.11 or 14.2 hereof) in a greater proportion than any such payment to and collateral received by any other Lender, if any, in respect of the similar Obligations owing to such other Lender, or interest thereon, such Benefited Lender shall purchase for cash from the other Lenders such portion of each such other Lender's Extensions of Credit, or shall provide such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such Benefited Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders; provided, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned to the extent of such recovery, but without interest. The Borrower agrees that each Lender so purchasing a portion of another Lender's Extensions of Credit may exercise all rights of payment (including, without limitation, rights of set-off) with respect to such portion as fully as if such Lender were the direct holder of such portion. 34 SECTION 5.7 Nature of Obligations of Lenders Regarding Extensions of Credit; Assumption by the Administrative Agent. The obligations of the Lenders under this Agreement to make the Loans and issue or participate in Letters of Credit are several and are not joint or joint and several. Unless the Administrative Agent shall have received notice from a Lender prior to a proposed borrowing date that such Lender will not make available to the Administrative Agent such Lender's ratable portion of the amount to be borrowed on such date (which notice shall not release such Lender of its obligations hereunder), the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the proposed borrowing date in accordance with Sections 2.3(b) and 4.2, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If such amount is made available to the Administrative Agent on a date after such borrowing date, such Lender shall pay to the Administrative Agent on demand an amount, until paid, equal to the product of (a) the amount not made available by such Lender in accordance with the terms hereof, times (b) the daily average Federal Funds Rate during such period as determined by the Administrative Agent, times (c) a fraction the numerator of which is the number of days that elapse from and including such borrowing date to the date on which such amount not made available by such Lender in accordance with the terms hereof shall have become immediately available to the Administrative Agent and the denominator of which is 360. A certificate of the Administrative Agent with respect to any amounts owing under this Section 5.7 shall be conclusive, absent manifest error. If such Lender's ratable portion of such borrowing is not made available to the Administrative Agent by such Lender within three (3) Business Days after such borrowing date, the Administrative Agent shall be entitled to recover such amount made available by the Administrative Agent with interest thereon at the rate per annum applicable to Base Rate Loans hereunder, on demand, from the Borrower. The failure of any Lender to make available its ratable portion of any Loan requested by the Borrower shall not relieve it or any other Lender of its obligation, if any, hereunder to make its ratable portion of such Loan available on the borrowing date, but no Lender shall be responsible for the failure of any other Lender to make its ratable portion of such Loan available on the borrowing date. Notwithstanding anything set forth herein to the contrary, any Lender that fails to make available its ratable portion of any Loan shall not (a) have any voting or consent rights under or with respect to any Loan Document or (b) constitute a "Lender" (or be included in the calculation of Required Lenders hereunder) for any voting or consent rights under or with respect to any Loan Document. SECTION 5.8 Changed Circumstances. (a) Circumstances Affecting LIBOR Rate Availability. If with respect to any Interest Period the Administrative Agent or any Lender (after consultation with the Administrative Agent) shall determine that, by reason of circumstances affecting the foreign exchange and interbank markets generally, deposits in eurodollars, in the applicable amounts are not being quoted via the Dow Jones Market Screen 3750 or offered to the Administrative Agent or such Lender for such Interest Period, then the Administrative Agent shall forthwith give notice thereof to the Borrower. Thereafter, until the Administrative Agent notifies the Borrower that such circumstances no longer exist, the obligation of the Lenders to make LIBOR Rate Loans and the right of the Borrower to convert any Loan to or continue any Loan as a LIBOR Rate Loan shall be suspended, and the Borrower shall repay in full (or cause to be repaid in full) the then outstanding principal amount of each such LIBOR Rate Loan together with accrued interest thereon, on the last day of the then current Interest Period applicable to such LIBOR Rate Loan or convert the then outstanding principal amount of each such LIBOR Rate Loan to a Base Rate Loan as of the last day of such Interest Period. (b) Laws Affecting LIBOR Rate Availability. If, after the date hereof, the introduction of, or any change in, any Applicable Law or any change in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any of the Lenders (or any of their respective Lending Offices) 35 with any request or directive (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, shall make it unlawful or impossible for any of the Lenders (or any of their respective Lending Offices) to honor its obligations hereunder to make or maintain any LIBOR Rate Loan, such Lender shall promptly give notice thereof to the Administrative Agent and the Administrative Agent shall promptly give notice to the Borrower and the other Lenders. Thereafter, until the Administrative Agent notifies the Borrower that such circumstances no longer exist, (i) the obligations of the Lenders to make LIBOR Rate Loans and the right of the Borrower to convert any Loan or continue any Loan as a LIBOR Rate Loan shall be suspended and thereafter the Borrower may select only Base Rate Loans hereunder, and (ii) if any of the Lenders may not lawfully continue to maintain a LIBOR Rate Loan to the end of the then current Interest Period applicable thereto as a LIBOR Rate Loan, the applicable LIBOR Rate Loan shall immediately be converted to a Base Rate Loan for the remainder of such Interest Period. (c) Increased Costs. If, after the date hereof, the introduction of, or any change in, any Applicable Law, or in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any of the Lenders (or any of their respective Lending Offices) with any request or directive (whether or not having the force of law) of such Governmental Authority, central bank or comparable agency: (i) shall (except as provided in Section 5.11(e)) subject any of the Lenders (or any of their respective Lending Offices) to any tax, duty or other charge with respect to any Note, Letter of Credit or Application or shall change the basis of taxation of payments to any of the Lenders (or any of their respective Lending Offices) of the principal of or interest on any Note, Letter of Credit or Application or any other amounts due under this Agreement in respect thereof (except for changes in the rate of franchise tax or tax on the overall net income of any of the Lenders or any of their respective Lending Offices imposed by the jurisdiction in which such Lender is organized or is or should be qualified to do business or such Lending Office is located); provided that the Borrower shall not be obligated to pay any amounts pursuant to this Section 5.8(c)(i) to the extent that such amounts are duplicative of any amounts paid by the Borrower pursuant to Section 5.11; or (ii) shall impose, modify or deem applicable any reserve (including, without limitation, any reserve imposed by the Board of Governors of the Federal Reserve System), special deposit, insurance or capital or similar requirement against assets of, deposits with or for the account of, or credit extended by any of the Lenders (or any of their respective Lending Offices) or shall impose on any of the Lenders (or any of their respective Lending Offices) or the foreign exchange and interbank markets any other condition affecting any Note; and the result of any of the foregoing events described in clause (i) or (ii) above is to increase the costs to any of the Lenders of maintaining any LIBOR Rate Loan or issuing or participating in Letters of Credit or to reduce the yield or amount of any sum received or receivable by any of the Lenders under this Agreement or under the Notes in respect of a LIBOR Rate Loan or Letter of Credit or Application, then such Lender shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify the Borrower of such fact and demand compensation therefor and, within fifteen (15) days after such notice by the Administrative Agent, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender or Lenders for such increased cost or reduction. The Administrative Agent will promptly notify the Borrower of any event of which it has knowledge which will entitle such Lender to compensation pursuant to this Section 5.8(c); provided, that the Administrative Agent shall incur no liability whatsoever to the Lenders or the Borrower in the event it fails to do so. The amount of such compensation shall be determined, in the applicable Lender's reasonable discretion, based upon the assumption that such Lender funded its Revolving Credit Commitment Percentage or Term Loan Percentage, as applicable, of the LIBOR Rate Loans in the London interbank market and using any reasonable attribution or averaging methods which such Lender reasonably deems appropriate and practical. A certificate of such Lender setting forth the 36 basis for determining such amount or amounts necessary to compensate such Lender shall be forwarded to the Borrower through the Administrative Agent and shall be conclusively presumed to be correct save for manifest error. SECTION 5.9 Indemnity. The Borrower hereby indemnifies each of the Lenders against any actual loss or expense, as certified by such Lender, which arises or is attributable to each Lender's obtaining, liquidating or employing deposits or other funds acquired to effect, fund or maintain any Loan (a) as a consequence of any failure by the Borrower to make any payment when due of any amount due hereunder in connection with a LIBOR Rate Loan, (b) due to any failure of the Borrower to borrow or continue any LIBOR Rate Loan or convert any Base Rate Loan to a LIBOR Rate Loan on a date specified therefor in a Notice of Borrowing or Notice of Conversion/Continuation or (c) due to any payment, prepayment or conversion of any LIBOR Rate Loan on a date other than the last day of the Interest Period therefor. The amount of such loss or expense shall be determined, in the applicable Lender's sole discretion, based upon the assumption that such Lender funded its Revolving Credit Commitment Percentage or Term Loan Percentage, as applicable, of the LIBOR Rate Loans in the London interbank market and using any reasonable attribution or averaging methods which such Lender reasonably deems appropriate and practical. A certificate of such Lender setting forth the basis for determining such amount or amounts necessary to compensate such Lender shall be forwarded to the Borrower through the Administrative Agent and shall be conclusively presumed to be correct save for manifest error. SECTION 5.10 Capital Requirements. If either (a) the introduction of, or any change in, or in the interpretation of, any Applicable Law or (b) compliance with any guideline or request from any central bank or comparable agency or other Governmental Authority (whether or not having the force of law), has or would have the effect of reducing the rate of return on the capital of, or has affected or would affect the amount of capital required to be maintained by, any Lender or any corporation controlling such Lender as a consequence of the Commitments and other commitments of this type or the LIBOR Rate Loans, below the rate which such Lender or such other corporation could have achieved but for such introduction, change or compliance, then within five (5) Business Days after written demand by any such Lender, the Borrower shall pay to such Lender from time to time as specified by such Lender additional amounts sufficient to compensate such Lender or other corporation for such reduction. A certificate as to such amounts submitted to the Borrower and the Administrative Agent by such Lender, shall, in the absence of manifest error, be presumed to be correct and binding for all purposes. SECTION 5.11 Taxes. (a) Payments Free and Clear. Except as otherwise provided in Section 5.11(e), any and all payments by the Borrower hereunder or under the Notes or in respect of the Letters of Credit shall be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholding, and all liabilities with respect thereto excluding, (i) in the case of each Lender and the Administrative Agent, income and franchise taxes imposed by the jurisdiction under the laws of which such Lender or the Administrative Agent (as the case may be) is organized or is or should be qualified to do business or any political subdivision thereof and (ii) in the case of each Lender, income and franchise taxes imposed by the jurisdiction of such Lender's Lending Office or any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be required by law to deduct or withhold any Taxes from or in respect of any sum payable hereunder or under any Note or in respect of any Letter of Credit to any Lender or the Administrative Agent, (A) except as otherwise provided in Section 5.11(e), the sum payable shall be increased as may be necessary so that after making all required deductions or withholdings (including deductions or withholdings applicable to additional sums payable under this Section 5.11) such Lender or the Administrative Agent (as the case may be) receives an amount equal to the amount such party would have received had no such deductions or withholdings been made, 37 (B) the Borrower shall make such deductions or withholdings, (C) the Borrower shall pay the full amount deducted to the relevant taxing authority or other authority in accordance with Applicable Law, and (D) the Borrower shall deliver to the Administrative Agent and such Lender evidence of such payment to the relevant taxing authority or other Governmental Authority in the manner provided in Section 5.11(d). (b) Stamp and Other Taxes. In addition, the Borrower shall pay any present or future stamp, registration, recordation or documentary taxes or any other similar fees or charges or excise or property taxes, levies of the United States or any state or political subdivision thereof or any applicable foreign jurisdiction which arise from any payment made hereunder or from the execution, delivery or registration of, or otherwise with respect to, this Agreement, the Loans, the Letters of Credit or the other Loan Documents, or the perfection of any rights or security interest in respect thereof (hereinafter referred to as "Other Taxes"). (c) Indemnity. Except as otherwise provided in Section 5.11(e), the Borrower shall indemnify each Lender and the Administrative Agent for the full amount of Taxes and Other Taxes (including, without limitation, any Taxes and Other Taxes imposed by any jurisdiction on amounts payable under this Section 5.11) paid by such Lender or the Administrative Agent (as the case may be) and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted. Such indemnification shall be made within thirty (30) days from the date such Lender or the Administrative Agent (as the case may be) makes written demand therefor. A certificate of such Lender setting forth the basis for determining such amount or amounts necessary to compensate such Lender shall be forwarded to the Borrower through the Administrative Agent and shall be conclusively presumed to be correct save for manifest error. (d) Evidence of Payment. Within thirty (30) days after the date of any payment of Taxes or Other Taxes, the Borrower shall furnish to the Administrative Agent and the applicable Lender, at its address referred to in Section 14.1, the original or a certified copy of a receipt evidencing payment thereof or other evidence of payment satisfactory to the Administrative Agent. (e) Delivery of Tax Forms. To the extent required by Applicable Law to reduce or eliminate withholding or payment of taxes, each Lender and the Administrative Agent shall deliver to the Borrower, with a copy to the Administrative Agent, on or before the Closing Date or concurrently with the delivery of the relevant Assignment and Acceptance, as applicable, (i) two United States Internal Revenue Service Forms W-9, Forms W-8ECI or Forms W-8BEN, as applicable (or successor forms) properly completed and certifying in each case that such Lender is entitled to a complete exemption from withholding or deduction for or on account of any United States federal income taxes, and (ii) an Internal Revenue Service Form W-8BEN or W-8ECI or successor applicable form, as the case may be, to establish an exemption from United States backup withholding taxes. Each such Lender further agrees to deliver to the Borrower, with a copy to the Administrative Agent, as applicable, two Form W-9, Form W-8BEN or W-8ECI, or successor applicable forms or manner of certification, as the case may be, on or before the date that any such form expires or becomes obsolete or after the occurrence of any event requiring a change in the most recent form previously delivered by it to the Borrower, certifying in the case of a Form W-9, Form W-8BEN or W-8ECI (or successor forms) that such Lender is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes (unless in any such case an event (including, without limitation, any change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders such forms inapplicable or the exemption to which such forms relate unavailable and such Lender notifies the Borrower and the Administrative Agent that it is not entitled to receive payments without deduction or withholding of United States federal income taxes) and, in the case of a Form W-9, Form W-8BEN or W-8ECI, establishing an exemption from United States backup withholding tax. Notwithstanding 38 anything in any Loan Document to the contrary, the Borrower shall not be required to pay additional amounts to any Lender or the Administrative Agent under Section 5.11 or Section 5.8(c), (i) if such Lender or the Administrative Agent fails to comply with the requirements of this Section 5.11(e), other than to the extent that such failure is due to a change in treaty, law or regulation occurring after the date on which such Lender or the Administrative Agent became a party to this Agreement or (ii) that are the result of such Lender's or the Administrative Agent's gross negligence or willful misconduct, as applicable. (f) Survival. Without prejudice to the survival of any other agreement of the Borrower hereunder, the agreements and obligations of the Borrower contained in this Section 5.11 shall survive the payment in full of the Obligations and the termination of the Commitments. SECTION 5.12 Security. The Obligations shall be secured as provided in the Security Documents. ARTICLE VI CLOSING; CONDITIONS OF CLOSING AND BORROWING SECTION 6.1 Closing. The closing shall take place at 10:00 a.m. on July 9, 2003, or at such other date and time as the parties hereto shall mutually agree. SECTION 6.2 Conditions to Closing. This Agreement shall become effective as of the date hereof subject to the satisfaction of each of the following conditions: (a) Executed Loan Documents. This Agreement, the Revolving Credit Notes, the Term Notes, the Swingline Note, the Security Documents, together with any other applicable Loan Documents, shall have been duly authorized, executed and delivered to the Administrative Agent by the parties thereto, shall be in full force and effect and no Default or Event of Default shall exist thereunder, and the Borrower shall have delivered original counterparts thereof to the Administrative Agent. (b) Closing Certificates; etc. (i) Officer's Certificate of the Borrower. The Administrative Agent shall have received a certificate from a Responsible Officer, in form and substance satisfactory to the Administrative Agent, to the effect that all representations and warranties of the Borrower contained in this Agreement and the other Loan Documents are true, correct and complete; that the Borrower is not in violation of any of the covenants contained in this Agreement and the other Loan Documents; that, after giving effect to the transactions contemplated by this Agreement, no Default or Event of Default has occurred and is continuing; and that the Borrower has satisfied each of the closing conditions. (ii) Certificate of Secretary of the Borrower and Guarantors. The Administrative Agent shall have received a certificate of the secretary or assistant secretary of the Borrower and each Guarantor certifying as to the incumbency and genuineness of the signature of each officer of the Borrower and each Guarantor executing Loan Documents to which it is a party and certifying that attached thereto is a true, correct and complete copy of (A) the articles of incorporation of the Borrower and each Guarantor and all amendments thereto, certified as of a recent date by the appropriate Governmental Authority in its jurisdiction of incorporation, (B) the bylaws of the Borrower and each Guarantor as in effect on the date of such certifications, (C) resolutions duly adopted by the Board of Directors of the Borrower and each Guarantor authorizing the borrowings contemplated hereunder and 39 the execution, delivery and performance of this Agreement and the other Loan Documents to which it is a party, and (D) each certificate required to be delivered pursuant to Section 6.2(b)(iii). (iii) Certificates of Good Standing. The Administrative Agent shall have received certificates as of a recent date of the good standing of the Borrower and each Guarantor under the laws of its jurisdiction of organization and, to the extent requested by the Administrative Agent, each other jurisdiction where the Borrower is qualified to do business and a certificate of the relevant taxing authorities of such jurisdictions certifying that such Person has filed required tax returns and owes no delinquent taxes. (iv) Opinions of Counsel. The Administrative Agent shall have received favorable opinions of counsel to the Borrower and the Guarantors addressed to the Administrative Agent and the Lenders with respect to the Borrower, the Guarantors, the Loan Documents and such other matters as the Lenders shall request, all in form and substance reasonably satisfactory to the Administrative Agent. (v) Tax Forms. The Administrative Agent shall have received copies of the United States Internal Revenue Service forms required by Section 5.11(e) hereof. (c) Collateral. (i) Assignment of Existing Liens. The administrative agent under the Existing Facility shall have assigned all of its right, title and interest in and to the collateral under the Existing Facility to the Administrative Agent under this Agreement pursuant to an instrument in form and substance reasonably satisfactory to the Administrative Agent. (ii) Filings and Recordings. All filings and recordations that are necessary to perfect the security interests of the Lenders in the collateral described in the Security Documents (including, without limitation, Assignment Agreements and Notices of Assignment executed by the applicable Loan Party (but not the Governmental Authority party thereto) with respect to each Material Government Contract existing as of the Closing Date) shall have been received by the Administrative Agent and the Administrative Agent shall have received evidence reasonably satisfactory thereto that upon such filings and recordations such security interests constitute valid and perfected first priority Liens therein. (iii) Pledged Collateral. The Administrative Agent shall have received (A) original stock certificates or other certificates evidencing the capital stock or other ownership interests pledged pursuant to the Collateral Agreement (to the extent such ownership interests are certificated), together with an undated stock power for each such certificate duly executed in blank by the registered owner thereof and (B) each original promissory note pledged pursuant to the Collateral Agreement. (iv) Lien Search. The Administrative Agent shall have received the results of a Lien search (including a search as to judgments, pending litigation and tax matters) made against the Borrower and each Restricted Domestic Subsidiary under the UCC (or applicable judicial docket) as in effect in any state in which each such Person is organized, indicating among other things that its assets are free and clear of any Lien except for Liens permitted hereunder or assigned in connection herewith. (v) Hazard and Liability Insurance. The Administrative Agent shall have received certificates of insurance, evidence of payment of all insurance premiums for the current policy year of each, and, if requested by the Administrative Agent, copies (certified by a Responsible Officer) of insurance policies in the form required under the Security Documents and otherwise in form and substance reasonably satisfactory to the Administrative Agent. 40 (vi) Title Insurance. The existing policies of title insurance on the properties subject to the Mortgage shall have been assigned to the Administrative Agent, and the Administrative Agent shall have received appropriate assignment and modification endorsements and datedowns with respect to such policies. Further, the Borrower agrees to provide or obtain any customary affidavits and indemnities as may be required or necessary to obtain such endorsements and datedowns satisfactory to the Administrative Agent. (vii) Title Exceptions. The Administrative Agent shall have received copies of all recorded documents creating exceptions to the title policies referred to in Section 6.2(c)(vi) which have been filed since the closing of the Existing Facility. (viii) Matters Relating to Flood Hazard Properties. The Administrative Agent shall have received a copy of a certification from the National Research Center, or any successor agency thereto, regarding each parcel of real property subject to the Mortgages. (ix) Surveys. The Administrative Agent shall have received copies of as-built surveys of a date not more than nine (9) months prior to the Closing Date of each parcel of real property subject to the Mortgages certified to the Administrative Agent by a registered engineer or land surveyor, provided, however, that if such certification is not obtained prior to the Closing Date, the Borrower shall provide such certification within forty-five (45) days of the Closing Date (which requirement may be waived by the Administrative Agent in its sole discretion). Each such survey shall be accompanied by an affidavit (a "Survey Affidavit") of an authorized signatory of the owner of such property stating that there have been no improvements or encroachments to the property since the date of the respective survey such that the existing survey is no longer accurate. Such survey shall show the area of such property, all boundaries of the land with courses and distances indicated, including chord bearings and arc and chord distances for all curves, and shall show dimensions and locations of all easements, private drives, roadways, and other facts materially affecting such property, and shall show such other details as the Administrative Agent may reasonably request, including, without limitation, any encroachment (and the extent thereof in feet and inches) onto the property or by any of the improvements on the property upon adjoining land or upon any easement burdening the property; any improvements, to the extent constructed, and the relation of the improvements by distances to the boundaries of the property, to any easements burdening the property, and to the established building lines and the street lines; and if improvements are existing, (A) a statement of the number of each type of parking space required by applicable laws, ordinances, orders, rules, regulations, restrictive covenants and easements affecting the improvement, and the number of each such type of parking space provided, and (B) the locations of all utilities serving the improvement. (x) Environmental Assessments. The Administrative Agent shall have received a Phase I environmental assessment and such other environmental report reasonably requested by the Administrative Agent dated as of a date not more than nine (9) months prior to the Closing Date regarding each parcel of real property subject to the Mortgages by an environmental engineering firm acceptable to the Administrative Agent showing no environmental conditions or liabilities in violation of Environmental Laws that could reasonably be expected to have a Material Adverse Effect, together with a reliance letter confirming that the Administrative Agent may rely thereon; provided, however, if such reliance letter is not obtained prior to the Closing Date, the Borrower shall provide such reliance letter within forty-five (45) days of the Closing Date (which requirement may be waived by the Administrative Agent in its sole discretion). (xi) Appraisals. The Administrative Agent shall have received appraisals dated as of a date not more than nine (9) months prior to the Closing Date of each parcel of real property subject to the Mortgages, in form and substance satisfactory to the Agents, together with a reliance letter confirming 41 that the Administrative Agent may rely thereon; provided, however, if such reliance letter is not obtained prior to the Closing Date, the Borrower shall provide such reliance letter within forty-five (45) days of the Closing Date (which requirement may be waived by the Administrative Agent in its sole discretion). (xii) Other Real Property Information. The Administrative Agent shall have received such other certificates, documents and information as are reasonably requested by the Lenders, including, without limitation, engineering and structural reports, permanent certificates of occupancy and evidence of zoning compliance, each in form and substance reasonably satisfactory to the Administrative Agent. (d) Consents; Defaults. (i) Governmental and Third Party Approvals. The Borrower shall have obtained all necessary approvals, authorizations and consents of any Person and of all Governmental Authorities and courts having jurisdiction with respect to the transactions contemplated by this Agreement and the other Loan Documents. (ii) No Injunction, Etc. No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any Governmental Authority to enjoin, restrain, or prohibit, or to obtain substantial damages in respect of, or which is related to or arises out of this Agreement or the other Loan Documents or the consummation of the transactions contemplated hereby or thereby, or which, in the Administrative Agent's sole discretion, would make it inadvisable to consummate the transactions contemplated by this Agreement and such other Loan Documents. (iii) No Event of Default. No Default or Event of Default shall have occurred and be continuing. (e) Financial Matters. (i) Financial Statements. The Administrative Agent shall have received (A) the most recent audited Consolidated financial statements of the Borrower and its Subsidiaries for each of the last three Fiscal Years, (B) unaudited Consolidated interim financial statements of the Borrower and its Subsidiaries for the fiscal quarter ended March 30, 2003, (C) a pro forma balance sheet of the Borrower and its Subsidiaries as of the Closing Date giving effect to the issuance of the indebtedness hereunder, the issuance of the High-Yield Notes and the consummation of the Share Purchase and (D) projected Consolidated financial statements (including balance sheets, income and cash flow statements) of the Borrower and its Subsidiaries for a seven-year period after the Closing Date, all in form and substance reasonably satisfactory to the Administrative Agent. (ii) Financial Condition Certificate. The Borrower shall have delivered to the Administrative Agent a certificate, in form and substance satisfactory to the Administrative Agent, and certified as accurate by a Responsible Officer, that (A) the Borrower and each of its Subsidiaries are each Solvent, (B) the Borrower's payables are current and not past due, (C) attached thereto are calculations evidencing compliance on a pro forma basis with the covenants contained in Article X hereof, (D) the financial projections previously delivered to the Administrative Agent represent the good faith estimates (utilizing reasonable assumptions) of the financial condition and operations of the Borrower and its Subsidiaries and (E) attached thereto is a calculation of the Applicable Margin pursuant to Section 5.1(c). (iii) Payment at Closing; Fee Letters. The Borrower shall have paid to the Administrative Agent and the Lenders the fees set forth or referenced in Section 5.3 and any other accrued and unpaid fees or commissions due hereunder (including, without limitation, reasonable legal 42 fees and expenses) and to any other Person such amount as may be due thereto in connection with the transactions contemplated hereby, including all taxes, fees and other charges in connection with the execution, delivery, recording, filing and registration of any of the Loan Documents. (f) Senior Unsecured Debt. The Borrower shall have used its best efforts to issue the High-Yield Notes and shall, in any event, have issued the Senior Unsecured Debt and received the net proceeds thereof. (g) Share Purchase. The Borrower shall have used a portion of the price of the Senior Unsecured Debt to effect the Share Purchase. (h) Paydown of Term Loans. The Borrower shall have repaid, on or before the Closing Date, an amount of the term loans outstanding under the Existing Facility so that the initial aggregate principal amount of Term Loans outstanding under this Agreement will be $100,000,000. (i) Miscellaneous. (i) Notice of Borrowing. The Administrative Agent shall have received a Notice of Borrowing, as applicable, from the Borrower in accordance with Section 2.3(a) and Section 4.2, and a Notice of Account Designation specifying the account or accounts to which the proceeds of any Loans made after the Closing Date are to be disbursed. (ii) WIH. The Borrower shall have formed WIH as a direct, wholly-owned Subsidiary of the Borrower and shall have transferred all of the outstanding capital stock of Wackenhut Corrections Corporation Australia, PTY Ltd., Wackenhut Correction UK, Ltd. and WCC South Africa, PTY, Ltd. to WIH. (iii) Rating of the Facility and the Borrower. The Borrower shall have received ratings from S&P and Moody's of, respectively, (A) at least BB- and Ba3 on its senior secured debt and (B) at least B- and B3 on the High-Yield Notes. (iv) Other Documents. All opinions, certificates and other instruments and all proceedings in connection with the transactions contemplated by this Agreement shall be satisfactory in form and substance to the Agents. The Agents shall have received copies of all other documents, certificates and instruments reasonably requested thereby, with respect to the transactions contemplated by this Agreement. SECTION 6.3 Conditions to All Extensions of Credit. The obligations of the Lenders to make any Extensions of Credit (including the initial Extension of Credit), convert or continue any Loan and/or the Issuing Lender to issue or extend any Letter of Credit and/or the Swingline Lender to make any Swingline Loan are subject to the satisfaction of the following conditions precedent on the relevant borrowing, continuation, conversion, issuance or extension date: (a) Continuation of Representations and Warranties. The representations and warranties contained in Article VII shall be true and correct on and as of such borrowing, continuation, conversion, issuance or extension date with the same effect as if made on and as of such date, except for any representation and warranty made as of an earlier date, which representation and warranty shall remain true and correct as of such earlier date. (b) No Existing Default. No Default or Event of Default shall have occurred and be continuing (i) on the borrowing, continuation or conversion date with respect to such Loan or after giving 43 effect to the Loans to be made, continued or converted on such date or (ii) on the issuance or extension date with respect to such Letter of Credit or after giving effect to the issuance or extension of such Letter of Credit on such date. (c) Notices. The Administrative Agent shall have received a Notice of Borrowing or Notice of Conversion/Continuation, as applicable, from the Borrower in accordance with Section 2.3(a) and Section 4.2. (d) Additional Documents. The Administrative Agent shall have received each additional document, instrument, legal opinion or other item reasonably requested by it. ARTICLE VII REPRESENTATIONS AND WARRANTIES OF THE BORROWER SECTION 7.1 Representations and Warranties. To induce the Administrative Agent and Lenders to enter into this Agreement and to induce the Lenders to make Extensions of Credit, the Borrower hereby represents and warrants to the Administrative Agent and Lenders both before and after giving effect to the transactions contemplated hereunder that: (a) Organization; Power; Qualification. Each of the Borrower and its Subsidiaries is duly organized, validly existing and in good standing (or its equivalent) under the laws of the jurisdiction of its incorporation or formation, has the power and authority to own its properties and to carry on its business as now being and hereafter proposed to be conducted and is duly qualified and authorized to do business in each jurisdiction in which the character of its properties or the nature of its business requires such qualification and authorization, except where such failure to qualify could not reasonably be expected to result in a Material Adverse Effect. The jurisdictions in which the Borrower and its Subsidiaries are organized and qualified to do business as of the Closing Date are described on Schedule 7.1(a). (b) Ownership. Each Subsidiary of the Borrower as of the Closing Date is listed on Schedule 7.1(b). As of the Closing Date, the capitalization of the Borrower and its Subsidiaries consists of the number of shares, authorized, issued and outstanding, of such classes and series, with or without par value, described on Schedule 7.1(b). All outstanding shares have been duly authorized and validly issued and are fully paid and nonassessable, with no personal liability attaching to the ownership thereof, and not subject to any preemptive or similar rights. The shareholders of the Subsidiaries of the Borrower and the number of shares owned by each as of the Closing Date are described on Schedule 7.1(b). As of the Closing Date, there are no outstanding stock purchase warrants, subscriptions, options, securities, instruments or other rights of any type or nature whatsoever, which are convertible into, exchangeable for or otherwise provide for or permit the issuance of capital stock of the Borrower or its Subsidiaries, except as described on Schedule 7.1(b). (c) Authorization of Agreement, Loan Documents and Borrowing. Each of the Borrower and its Restricted Subsidiaries has the right, power and authority and has taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement and each of the other Loan Documents to which it is a party in accordance with their respective terms. This Agreement and each of the other Loan Documents have been duly executed and delivered by the duly authorized officers of the Borrower and each of its Subsidiaries party thereto, and each such document constitutes the legal, valid and binding obligation of the Borrower or its Subsidiary party thereto, enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar state or federal debtor relief laws from time to time in effect which affect the enforcement of creditors' rights in general and the availability of equitable remedies. 44 (d) Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc. The execution, delivery and performance by the Borrower and its Subsidiaries of the Loan Documents to which each such Person is a party, in accordance with their respective terms, the Extensions of Credit hereunder and the transactions contemplated hereby do not and will not, by the passage of time, the giving of notice or otherwise, (i) require any Governmental Approval or violate any Applicable Law relating to the Borrower or any of its Subsidiaries, (ii) conflict with, result in a breach of or constitute a default under the articles of incorporation, bylaws or other organizational documents of the Borrower or any of its Subsidiaries or, except as could not reasonably be expected to result in a Material Adverse Effect, any indenture, agreement or other instrument to which such Person is a party or by which any of its properties may be bound or any Governmental Approval relating to such Person, (iii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by such Person other than Liens arising under the Loan Documents or (iv) require any consent or authorization of, filing with, or other act in respect of, an arbitrator or Governmental Authority and no consent of any other Person is required in connection with the execution, delivery, performance, validity or enforceability of this Agreement except, in each case, (w) as may be required by laws affecting the offering and sale of securities generally, (x) filings with the United States Copyright Office and/or the United States Patent and Trademark Office, (y) filings under the UCC and/or the Assignment of Claims Act (or analogous state Applicable Law) and (z) those notices, consents and authorizations which have been obtained prior to the Closing Date. (e) Compliance with Law; Governmental Approvals. Each of the Borrower and its Subsidiaries (i) has all Governmental Approvals required by any Applicable Law for it to conduct its business, each of which is in full force and effect, is final and not subject to review on appeal and is not the subject of any pending or, to the best of its knowledge, threatened attack by direct or collateral proceeding, (ii) is in compliance with each Governmental Approval applicable to it and in compliance with all other Applicable Laws relating to it or any of its respective properties and (iii) has timely filed all material reports, documents and other materials required to be filed by it under all Applicable Laws with any Governmental Authority and has retained all material records and documents required to be retained by it under Applicable Law in each case, except as could not reasonably be expected to result in a Material Adverse Effect. (f) Tax Returns and Payments. Each of the Borrower and its Subsidiaries has duly filed or caused to be filed all federal, state, local and other tax returns required by Applicable Law to be filed, and has paid, or made adequate provision for the payment of, all federal, state, local and other taxes, assessments and governmental charges or levies upon it and its property, income, profits and assets which are due and payable except for such taxes, assessments, charges and levies being contested in good faith by appropriate proceedings. Such returns accurately reflect in all material respects all liability for taxes of the Borrower and its Subsidiaries for the periods covered thereby. There is no ongoing audit or examination or, to the knowledge of the Borrower, other investigation by any Governmental Authority of the tax liability of the Borrower and its Subsidiaries that could reasonably be expected to result in a Material Adverse Effect. No Governmental Authority has asserted any Lien or other claim against the Borrower or any Subsidiary thereof with respect to unpaid taxes which has not been discharged or resolved other than any lien or claim being contested in good faith by appropriate proceedings. The charges, accruals and reserves on the books of the Borrower and any of its Subsidiaries in respect of federal, state, local and other taxes for all Fiscal Years and portions thereof since the organization of the Borrower and any of its Subsidiaries are in the judgment of the Borrower adequate, and the Borrower does not anticipate any additional taxes or assessments for any of such years. (g) Intellectual Property Matters. Each of the Borrower and its Restricted Subsidiaries owns or possesses rights to use all franchises, licenses, copyrights, copyright applications, patents, patent rights or licenses, patent applications, trademarks, trademark rights, service mark, service mark rights, trade 45 names, trade name rights, copyrights and rights with respect to the foregoing which are required to conduct its business. No event has occurred which permits, or after notice or lapse of time or both would permit, the revocation or termination of any such rights, and neither the Borrower nor any Restricted Subsidiary thereof is liable to any Person for infringement under Applicable Law with respect to any such rights as a result of its business operations. (h) Environmental Matters. (i) The properties owned, leased or operated by the Borrower and its Subsidiaries now or in the past do not contain, and to their knowledge have not previously contained, any Hazardous Materials in amounts or concentrations which (A) constitute or constituted a violation of applicable Environmental Laws or (B) could give rise to liability under applicable Environmental Laws; (ii) The Borrower, each Subsidiary and such properties and all operations conducted in connection therewith are in material compliance, and have been in material compliance, with all applicable Environmental Laws, and there is no contamination at, under or about such properties or such operations which could interfere with the continued operation of such properties or impair the fair saleable value thereof; (iii) Neither the Borrower nor any Subsidiary thereof has received any written notification of any notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters, Hazardous Materials, or compliance with Environmental Laws, nor does the Borrower or any Subsidiary thereof have knowledge or reason to believe that any such notice will be received or is being threatened; (iv) Hazardous Materials have not been transported or disposed of to or from the properties owned, leased or operated by the Borrower and its Subsidiaries in material violation of, or in a manner or to a location which could give rise to material liability under, Environmental Laws, nor have any Hazardous Materials been generated, treated, stored or disposed of at, on or under any of such properties in material violation of, or in a manner that could give rise to material liability under, any applicable Environmental Laws; (v) No judicial proceedings or governmental or administrative action is pending, or, to the knowledge of the Borrower, threatened, under any Environmental Law to which the Borrower or any Subsidiary thereof is or will be named as a potentially responsible party with respect to such properties or operations conducted in connection therewith, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Law with respect to Borrower, any Subsidiary or such properties or such operations; and (vi) There has been no release, or to the best of the Borrower's knowledge, threat of release, of Hazardous Materials at or from properties owned, leased or operated by the Borrower or any Subsidiary, now or in the past, in violation of or in amounts or in a manner that could give rise to liability under Environmental Laws. (i) ERISA. (i) As of the Closing Date, neither the Borrower nor any ERISA Affiliate maintains or contributes to, or has any obligation under, any Employee Benefit Plans other than those identified on Schedule 7.1(i); 46 (ii) The Borrower and each ERISA Affiliate is in material compliance with all applicable provisions of ERISA and the regulations and published interpretations thereunder with respect to all Employee Benefit Plans except for any required amendments for which the remedial amendment period as described in Section 401(b) of the Code has not yet expired and except where a failure to so comply could not reasonably be expected to have a Material Adverse Effect. Each Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been determined by the Internal Revenue Service to be so qualified, and each trust related to such plan has been determined to be exempt under Section 501(a) of the Code except for such plans that have not yet received determination letters but for which the remedial amendment period for submitting a determination letter has not yet expired. No liability has been incurred by the Borrower or any ERISA Affiliate which remains unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan or any Multiemployer Plan except for a liability that could not reasonably be expected to have a Material Adverse Effect; (iii) As of the Closing Date, no Pension Plan has been terminated, nor has any accumulated funding deficiency (as defined in Section 412 of the Code) been incurred (without regard to any waiver granted under Section 412 of the Code), nor has any funding waiver from the Internal Revenue Service been received or requested with respect to any Pension Plan, nor has the Borrower or any ERISA Affiliate failed to make any contributions or to pay any amounts due and owing as required by Section 412 of the Code, Section 302 of ERISA or the terms of any Pension Plan prior to the due dates of such contributions under Section 412 of the Code or Section 302 of ERISA, nor has there been any event requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension Plan; (iv) Except where the failure of any of the following representations to be correct in all material respects could not reasonably be expected to have a Material Adverse Effect, neither the Borrower nor any ERISA Affiliate has: (A) engaged in a nonexempt prohibited transaction described in Section 406 of the ERISA or Section 4975 of the Code, (B) incurred any liability to the PBGC which remains outstanding other than the payment of premiums and there are no premium payments which are due and unpaid, (C) failed to make a required contribution or payment to a Multiemployer Plan, or (D) failed to make a required installment or other required payment under Section 412 of the Code; (v) No Termination Event has occurred or is reasonably expected to occur; and (vi) Except where the failure of any of the following representations to be correct in all material respects could not reasonably be expected to have a Material Adverse Effect, no proceeding, claim (other than a benefits claim in the ordinary course of business), lawsuit and/or investigation is existing or, to the best knowledge of the Borrower after due inquiry, threatened concerning or involving any (A) employee welfare benefit plan (as defined in Section 3(1) of ERISA) currently maintained or contributed to by the Borrower or any ERISA Affiliate, (B) Pension Plan or (C) Multiemployer Plan. (j) Margin Stock. Neither the Borrower nor any Subsidiary thereof is engaged principally or as one of its activities in the business of extending credit for the purpose of "purchasing" or "carrying" any "margin stock" (as each such term is defined or used, directly or indirectly, in Regulation U of the Board of Governors of the Federal Reserve System). No part of the proceeds of any of the Loans or Letters of Credit will be used for purchasing or carrying margin stock or for any purpose which violates, or which would be inconsistent with, the provisions of Regulation T, U or X of such Board of Governors. (k) Government Regulation. Neither the Borrower nor any Subsidiary thereof is an "investment company" or a company "controlled" by an "investment company" (as each such term is defined or used in the Investment Company Act of 1940, as amended) and neither the Borrower nor any Subsidiary thereof is, or after giving effect to any Extension of Credit will be, subject to regulation under 47 the Public Utility Holding Company Act of 1935 or the Interstate Commerce Act, each as amended, or any other Applicable Law which limits its ability to incur or consummate the transactions contemplated hereby. (l) Material Contracts. Schedule 7.1(l) sets forth a complete and accurate list of all Material Contracts of the Borrower and its Subsidiaries in effect as of the Closing Date not listed on any other Schedule hereto; other than as set forth in Schedule 7.1(l), each such Material Contract is, and after giving effect to the consummation of the transactions contemplated by the Loan Documents will be, in full force and effect in accordance with the terms thereof. To the extent requested by the Administrative Agent, the Borrower and its Subsidiaries have delivered to the Administrative Agent a true and complete copy of each Material Contract required to be listed on Schedule 7.1(l) or any other Schedule hereto. Neither the Borrower nor any Subsidiary (nor, to the knowledge of the Borrower, any other party thereto) is in breach of or in default under any Material Contract in any material respect. (m) Employee Relations. Neither the Borrower nor any Restricted Subsidiary is, as of the Closing Date, party to any collective bargaining agreement nor has any labor union been recognized as the representative of its employees except as set forth on Schedule 7.1(m). The Borrower knows of no pending, threatened or contemplated strikes, work stoppage or other collective labor disputes involving its employees or those of its Restricted Subsidiaries. (n) Burdensome Provisions. Neither the Borrower nor any Subsidiary thereof is a party to any indenture, agreement, lease or other instrument, or subject to any corporate or partnership restriction, Governmental Approval or Applicable Law which in the foreseeable future could be reasonably expected to have a Material Adverse Effect. The Borrower and its Subsidiaries do not presently anticipate that future expenditures needed to meet the provisions of any statutes, orders, rules or regulations of a Governmental Authority will be so burdensome as to have a Material Adverse Effect. No Subsidiary is party to any agreement or instrument or otherwise subject to any restriction or encumbrance that restricts or limits its ability to make dividend payments or other distributions in respect of its capital stock to the Borrower or any Subsidiary or to transfer any of its assets or properties to the Borrower or any other Subsidiary in each case other than existing under or by reason of the Loan Documents or Applicable Law. (o) Financial Statements. (i) The (A) audited Consolidated balance sheet of the Borrower and its Subsidiaries as of December 30, 2002 and the related audited statements of income and retained earnings and cash flows for the Fiscal Year then ended and (B) unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of March 30, 2003 and related unaudited interim statements of income and retained earnings, copies of which have been furnished to the Administrative Agent, are complete and correct and fairly present on a Consolidated basis the assets, liabilities and financial position of the Borrower and its Subsidiaries as at such dates, and the results of the operations and changes of financial position for the periods then ended (other than customary year-end adjustments for unaudited financial statements). All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP. The Borrower and its Subsidiaries have no Debt, obligation or other unusual forward or long-term commitment which is not fairly reflected in the foregoing financial statements or in the notes thereto. (ii) The pro forma balance sheet of the Borrower and its Subsidiaries delivered pursuant to Section 6.2(e)(i)(C) represents, as of the Closing Date, the good faith estimate of the Borrower and its senior management concerning the effect of the issuance of the indebtedness hereunder, the issuance of the High-Yield Notes, the consummation of the Share Purchase and the disposition by the Borrower of its ownership interest in PCG as contemplated hereby. 48 (iii) The projected Consolidated financial statements of the Borrower delivered pursuant to Section 6.2(e)(i)(D) represent, as of the Closing Date, the good faith estimate of the Borrower and its senior management based upon the assumptions set forth therein. (p) No Material Adverse Change. Since December 30, 2002, there has been no material adverse change in the properties, business, operations, prospects, or condition (financial or otherwise) of the Borrower and its Subsidiaries and no event has occurred or condition arisen that could reasonably be expected to have a Material Adverse Effect. (q) Solvency. As of the Closing Date and after giving effect to the issuance of the Senior Unsecured Debt and the use of the proceeds thereof, the Borrower and each of its Subsidiaries will be Solvent. (r) Titles to Properties. Each of the Borrower and its Subsidiaries has such title to the real property owned or leased by it as is necessary or desirable to the conduct of its business and valid and legal title to all of its personal property and assets, including, but not limited to, those reflected on the balance sheets of the Borrower and its Subsidiaries delivered pursuant to Section 7.1(o), except those which have been disposed of by the Borrower or its Subsidiaries subsequent to such date which dispositions have been in the ordinary course of business or as otherwise expressly permitted hereunder. Schedule 7.1(r) is a complete and correct listing of real property owned by the Borrower or any Restricted Domestic Subsidiary that has an appraised value in excess of $1,000,000. (s) Liens. None of the properties and assets of the Borrower or any Subsidiary thereof is subject to any Lien, except Liens permitted pursuant to Section 11.2. No financing statement under the UCC of any state which names the Borrower or any Subsidiary thereof or any of their respective trade names or divisions as debtor and which has not been terminated, has been filed in any state or other jurisdiction and neither the Borrower nor any Subsidiary thereof has signed any such financing statement or any security agreement authorizing any secured party thereunder to file any such financing statement, except to perfect those Liens permitted by Section 11.2 hereof and financing statements filed solely for notification purposes by lessors and/or consignors. (t) Debt and Guaranty Obligations. Schedule 7.1(t) is a complete and correct listing of all Debt and Guaranty Obligations of the Borrower and its Subsidiaries as of the Closing Date in excess of $1,000,000. The Borrower and its Subsidiaries have performed and are in compliance with all of the material terms of such Debt and Guaranty Obligations and all instruments and agreements relating thereto, and no default or event of default, or event or condition which with notice or lapse of time or both would constitute such a default or event of default on the part of the Borrower or any of its Subsidiaries exists with respect to any such Debt or Guaranty Obligation. (u) Litigation. Except for matters existing on the Closing Date and set forth on Schedule 7.1(u), there are no actions, suits or proceedings pending nor, to the knowledge of the Borrower, threatened against or in any other way relating adversely to or affecting the Borrower or any Subsidiary thereof or any of their respective properties in any court or before any arbitrator of any kind or before or by any Governmental Authority, in each case except as could not reasonably be expected to result in a Material Adverse Effect. (v) Absence of Defaults. No event has occurred or is continuing which constitutes a Default or an Event of Default, or which constitutes, or which with the passage of time or giving of notice or both would constitute, a default or event of default by the Borrower or any Restricted Subsidiary under any Material Contract or judgment, decree or order to which the Borrower or its Subsidiaries is a party or by which the Borrower or its Subsidiaries or any of their respective properties may be bound or which would 49 require the Borrower or its Subsidiaries to make any payment thereunder prior to the scheduled maturity date therefor. (w) Senior Debt Status. The Obligations of the Borrower and each of its Subsidiaries under this Agreement and each of the other Loan Documents ranks and shall continue to rank senior in priority of payment to all Subordinated Debt of each such Person and is designated as "Senior Indebtedness" under all instruments and documents, now or in the future, relating to all Subordinated Debt of such Person. (x) Accuracy and Completeness of Information. All written information, reports and other papers and data produced by or on behalf of the Borrower or any Subsidiary thereof (other than financial projections, which shall be subject to the standard set forth in Section 8.1(c)) and furnished to the Lenders were, at the time the same were so furnished, complete and correct in all material respects to the extent necessary to give the recipient a true and accurate knowledge of the subject matter. No document furnished or written statement made to the Administrative Agent or the Lenders by the Borrower or any Subsidiary thereof in connection with the negotiation, preparation or execution of this Agreement or any of the Loan Documents contains or will contain any untrue statement of a fact material to the creditworthiness of the Borrower or its Subsidiaries or omits or will omit to state a fact necessary in order to make the statements contained therein not misleading. The Borrower has disclosed in writing to the Administrative Agent all pending claims or matters that could reasonably be expected to have a Material Adverse Effect. SECTION 7.2 Survival of Representations and Warranties, Etc. All representations and warranties set forth in this Article VII and all representations and warranties contained in any certificate, or any of the Loan Documents (including, but not limited to, any such representation or warranty made in or in connection with any amendment thereto) shall constitute representations and warranties made under this Agreement. All representations and warranties made under this Agreement shall be made or deemed to be made at and as of the Closing Date (except those that are expressly made as of a specific date), shall survive the Closing Date and shall not be waived by the execution and delivery of this Agreement, any investigation made by or on behalf of the Lenders or any borrowing hereunder. ARTICLE VIII FINANCIAL INFORMATION AND NOTICES Until all the Obligations have been paid and satisfied in full and the Commitments terminated, unless consent has been obtained in the manner set forth in Section 14.11, the Borrower will furnish or cause to be furnished to the Administrative Agent at the Administrative Agent's Office at the address set forth in Section 14.1 and to the Lenders at their respective addresses as set forth in the Register, or such other office as may be designated by the Administrative Agent and Lenders from time to time: SECTION 8.1 Financial Statements and Projections. (a) Quarterly Financial Statements. As soon as practicable and in any event within fifty (50) days after the end of each of the first three fiscal quarters of each Fiscal Year (or, if either such date is earlier, on the date of any required public filing thereof, or five (5) days following any date on which the Borrower may be required to file such statements), an unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such fiscal quarter and unaudited Consolidated statements of income, retained earnings and cash flows for the fiscal quarter then ended and that portion of the Fiscal Year then ended, including the notes thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the corresponding period in the preceding Fiscal Year and 50 prepared by the Borrower in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the period, and certified by the chief financial officer or treasurer of the Borrower to present fairly in all material respects the financial condition of the Borrower and its Subsidiaries on a Consolidated basis as of their respective dates and the results of operations of the Borrower and its Subsidiaries for the respective periods then ended, subject to normal year end adjustments. Delivery by the Borrower to the Administrative Agent for the benefit of the Lenders of the Borrower's quarterly report to the SEC on Form 10-Q with respect to any fiscal quarter within the period specified above shall be deemed to be compliance by the Borrower with this Section 8.1(a). (b) Annual Financial Statements. As soon as practicable and in any event within ninety-five (95) days after the end of each Fiscal Year (or, if either such date is earlier, on the date of any required public filing thereof, or five (5) days following any date on which the Borrower may be required to file such statements), an audited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such Fiscal Year and audited Consolidated statements of income, retained earnings and cash flows for the Fiscal Year then ended, including the notes thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the preceding Fiscal Year and audited by an independent certified public accounting firm acceptable to the Administrative Agent in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the year, and accompanied by a report thereon by such certified public accountants that is not qualified with respect to scope limitations imposed by the Borrower or any of its Subsidiaries or with respect to accounting principles followed by the Borrower or any of its Subsidiaries not in accordance with GAAP. Delivery by the Borrower to the Administrative Agent for the benefit of the Lenders of the Borrower's annual report to the SEC on Form 10-K with respect to any fiscal year within the period specified above shall be deemed to be compliance by the Borrower with this Section 8.1(b). (c) Annual Business Plan and Financial Projections. As soon as practicable and in any event within fifteen (15) days prior to the beginning of each Fiscal Year commencing for Fiscal Year 2004, a business plan of the Borrower and its Subsidiaries for the ensuing Fiscal Year, such plan to be prepared in accordance with GAAP and to include the following: an operating and capital budget, a projected income statement, statement of cash flows and balance sheet and a report containing management's discussion and analysis of such projections, accompanied by a certificate from the chief financial officer or treasurer of the Borrower to the effect that, to the best of such officer's knowledge, such projections are good faith estimates (utilizing reasonable assumptions) of the financial condition and operations of the Borrower and its Subsidiaries for such four (4) quarter period. SECTION 8.2 Officer's Compliance Certificate. At each time financial statements are delivered pursuant to Sections 8.1(a) or (b) and at such other times as the Administrative Agent shall reasonably request, a certificate of the chief financial officer or the treasurer of the Borrower in the form of Exhibit F attached hereto (an "Officer's Compliance Certificate"). SECTION 8.3 Annual Accountants' Certificate. At each time financial statements are delivered pursuant to Section 8.1(b), a certificate of the independent public accountants certifying such financial statements addressed to the Administrative Agent for the benefit of the Lenders: (a) stating that in making the examination necessary for the certification of such financial statements, they obtained no knowledge of any Default or Event of Default or, if such is not the case, specifying such Default or Event of Default and its nature and period of existence; and 51 (b) including the calculations reviewed by such accountants in connection with their audit of the Consolidated financial statements required to establish whether or not the Borrower and its Subsidiaries are in compliance with the financial covenants set forth in Article X hereof as at the end of each respective period. SECTION 8.4 Other Reports. (a) Promptly upon receipt thereof, copies of all material reports, if any, submitted to the Borrower or its Board of Directors by its independent public accountants in connection with their auditing function, including, without limitation, any management report and any management responses thereto; and (b) Such other information regarding the operations, business affairs and financial condition of the Borrower or any of its Subsidiaries as the Administrative Agent or any Lender may reasonably request. SECTION 8.5 Notice of Litigation and Other Matters. Prompt (but in no event later than ten (10) days after an officer of the Borrower obtains knowledge thereof) telephonic and written notice of: (a) the commencement of all proceedings and investigations by or before any Governmental Authority and all actions and proceedings in any court or before any arbitrator against or involving the Borrower or any Subsidiary thereof or any of their respective properties, assets or businesses which could reasonably be determined to result in a Material Adverse Effect; (b) any notice of any material violation received by the Borrower or any Subsidiary thereof from any Governmental Authority including, without limitation, any notice of material violation of Environmental Laws; (c) any labor controversy that has resulted in, or threatens to result in, a strike or other work action against the Borrower or any Subsidiary thereof which could reasonably be determined to result in a Material Adverse Effect; (d) any attachment, judgment, lien, levy or order exceeding $1,000,000 that may be assessed against the Borrower or any Subsidiary thereof; (e) (i) any Default or Event of Default, or (ii) any event which constitutes or which with the passage of time or giving of notice or both would constitute a default or event of default under any Material Contract to which the Borrower or any of its Subsidiaries is a party or by which the Borrower or any Subsidiary thereof or any of their respective properties may be bound; (f) (i) any unfavorable determination letter from the Internal Revenue Service regarding the qualification of an Employee Benefit Plan under Section 401(a) of the Code (along with a copy thereof), (ii) all notices received by the Borrower or any ERISA Affiliate of the PBGC's intent to terminate any Pension Plan or to have a trustee appointed to administer any Pension Plan, (iii) all notices received by the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor concerning the imposition or amount of withdrawal liability pursuant to Section 4202 of ERISA and (iv) the Borrower obtaining knowledge or reason to know that the Borrower or any ERISA Affiliate has filed or intends to file a notice of intent to terminate any Pension Plan under a distress termination within the meaning of Section 4041(c) of ERISA; 52 (g) contemporaneously with the delivery of the quarterly reports required herein, (and, upon the occurrence and during the continuation of an Event of Default, on a more frequent basis if requested by the Administrative Agent), a list of all Material Government Contracts which have (i) been completed or have lapsed or terminated and not renewed or (ii) been entered into, in each case, since the most recent list provided by the Borrower and signed by a Responsible Officer of the Borrower as of the last Business Day of such fiscal quarter; and (h) any event which makes any of the representations set forth in Section 7.1 inaccurate in any respect. SECTION 8.6 Accuracy of Information. All written information, reports, statements and other papers and data furnished by or on behalf of the Borrower to the Administrative Agent or any Lender whether pursuant to this Article VIII or any other provision of this Agreement, or any of the Security Documents, shall, at the time the same is so furnished, comply with the representations and warranties set forth in Section 7.1(x). ARTICLE IX AFFIRMATIVE COVENANTS Until all of the Obligations have been paid and satisfied in full and the Commitments terminated, unless consent has been obtained in the manner provided for in Section 14.11, the Borrower will, and will cause each of its Restricted Subsidiaries to: SECTION 9.1 Preservation of Corporate Existence and Related Matters. Except as permitted by Section 11.4, preserve and maintain its separate corporate existence and all rights, franchises, licenses and privileges necessary to the conduct of its business, and qualify and remain qualified as a foreign corporation and authorized to do business in each jurisdiction in which the failure to so qualify could reasonably be expected to have a Material Adverse Effect. SECTION 9.2 Maintenance of Property. In addition to the requirements of any of the Security Documents, protect and preserve all properties useful in and material to its business, including copyrights, patents, trade names, service marks and trademarks; maintain in good working order and condition all buildings, equipment and other tangible real and personal property; and from time to time make or cause to be made all renewals, replacements and additions to such property necessary for the conduct of its business, so that the business carried on in connection therewith may be conducted in a commercially reasonable matter. SECTION 9.3 Insurance. Maintain insurance (including, without limitation, hazard and business interruption) with financially sound and reputable insurance companies against such risks and in such amounts as are customarily maintained by similar businesses and as may be required by Applicable Law and as are required by any Security Documents, and on the Closing Date and from time to time thereafter deliver to the Administrative Agent upon its request a detailed list of the insurance then in effect, stating the names of the insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof and the properties and risks covered thereby. SECTION 9.4 Accounting Methods and Financial Records. Maintain a system of accounting, and keep such books, records and accounts (which shall be true and complete in all material respects) as may be required or as may be necessary to permit the preparation of financial statements in accordance with GAAP and in compliance with the regulations of any Governmental Authority having jurisdiction over it or any of its properties. 53 SECTION 9.5 Payment and Performance of Obligations. Pay and perform all Obligations under this Agreement and the other Loan Documents, and pay or perform (a) all taxes, assessments and other governmental charges that may be levied or assessed upon it or any of its property, and (b) all other indebtedness, obligations and liabilities in accordance with customary trade practices; provided, that the Borrower or such Restricted Subsidiary may contest any item described in clauses (a) or (b) of this Section 9.5 in good faith so long as adequate reserves are maintained with respect thereto in accordance with GAAP. SECTION 9.6 Compliance With Laws and Approvals. Observe and remain in compliance in all material respects with all Applicable Laws and maintain in full force and effect all material Governmental Approvals, in each case applicable to the conduct of its business. SECTION 9.7 Environmental Laws. In addition to and without limiting the generality of Section 9.6, (a) materially comply with, and ensure such material compliance by all tenants and subtenants with all applicable Environmental Laws and obtain and comply with and maintain, and ensure that all tenants and subtenants, if any, obtain and comply with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws, (b) conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions required under Environmental Laws, and promptly comply with all lawful orders and directives of any Governmental Authority regarding Environmental Laws, and (c) defend, indemnify and hold harmless the Administrative Agent and the Lenders, and their respective parents, Subsidiaries, Affiliates, employees, agents, officers and directors, from and against any claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or relating to the presence of Hazardous Materials, or the violation of, noncompliance with or liability under any Environmental Laws applicable to the operations of the Borrower or any such Restricted Subsidiary, or any orders, requirements or demands of Governmental Authorities related thereto, including, without limitation, reasonable attorney's and consultant's fees, investigation and laboratory fees, response costs, court costs and litigation expenses, except to the extent that any of the foregoing directly result from the gross negligence or willful misconduct of the party seeking indemnification therefor. SECTION 9.8 Compliance with ERISA. In addition to and without limiting the generality of Section 9.6, (a) except where the failure to so comply could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) comply with all material applicable provisions of ERISA and the regulations and published interpretations thereunder with respect to all Employee Benefit Plans, (ii) not take any action or fail to take action the result of which could be a liability to the PBGC or to a Multiemployer Plan, (iii) not participate in any prohibited transaction that could result in any civil penalty under ERISA or tax under the Code and (iv) operate each Employee Benefit Plan in such a manner that will not incur any tax liability under Section 4980B of the Code or any liability to any qualified beneficiary as defined in Section 4980B of the Code and (b) furnish to the Administrative Agent upon the Administrative Agent's request such additional information about any Employee Benefit Plan as may be reasonably requested by the Administrative Agent. SECTION 9.9 Compliance With Agreements. Comply in all respects with each material term, condition and provision of all leases, agreements and other instruments entered into in the conduct of its business including, without limitation, any Material Contract; provided, that the Borrower or any such Restricted Subsidiary may contest any such lease, agreement or other instrument in good faith through applicable proceedings so long as adequate reserves are maintained in accordance with GAAP. SECTION 9.10 Visits and Inspections. Permit representatives of the Administrative Agent or any Lender, from time to time (during regular business hours upon advance notice, provided no Default or 54 Event of Default is continuing), to visit and inspect its properties; inspect, audit and make extracts from its books, records and files, including, but not limited to, management letters prepared by independent accountants; and discuss with its principal officers, and its independent accountants, its business, assets, liabilities, financial condition, results of operations and business prospects. SECTION 9.11 Additional Subsidiaries. (a) Additional Domestic Subsidiaries. Notify the Administrative Agent of (i) the redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary in accordance with Section 9.11(c) below or (ii) the creation or acquisition of any Domestic Subsidiary, and (unless such Domestic Subsidiary has been designated as an Unrestricted Subsidiary pursuant to Section 9.11(d)) promptly thereafter (and in any event within thirty (30) days), cause such Person to (A) become a Guarantor by executing and delivering to the Administrative Agent a supplement to the Guaranty Agreement or such other document as the Administrative Agent shall deem appropriate for such purpose, (B) deliver to the Administrative Agent a duly executed Joinder Agreement and comply with the terms of each Security Document, (C) deliver to the Administrative Agent documents of the types referred to in clauses (ii) and (iii) of Section 6.2(b) and favorable opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clauses (A) and (B)) and (D) deliver to the Administrative Agent such other documents and closing certificates as may be reasonably requested by the Administrative Agent, all in form, content and scope reasonably satisfactory to the Administrative Agent. (b) Additional Foreign Subsidiaries. Notify the Administrative Agent at the time that any Person becomes a first tier Foreign Subsidiary of the Borrower or any Restricted Subsidiary, and at the request of the Administrative Agent, promptly thereafter (and in any event within forty-five (45) days after such request), cause (i) the Borrower or applicable Restricted Subsidiary to deliver to the Administrative Agent a supplement to the Security Documents pledging sixty-five percent (65%) of the total outstanding ownership interest or capital stock of such new Foreign Subsidiary and a consent thereto executed by such new Foreign Subsidiary (including, without limitation, if applicable, original stock certificates (or the equivalent thereof pursuant to the Applicable Laws and practices of any relevant foreign jurisdiction) evidencing the capital stock of such new Foreign Subsidiary, together with an appropriate undated stock power for each certificate duly executed in blank by the registered owner thereof), (ii) the Borrower or such Restricted Subsidiary to deliver to the Administrative Agent a favorable opinion of counsel (which shall cover, among other things, the legality, validity, binding effect and enforceability of such pledge), and (iii) such Person to deliver to the Administrative Agent such other documents and closing certificates as may be reasonably requested by the Administrative Agent, all in form, content and scope reasonably satisfactory to the Administrative Agent. (c) Redesignation of Unrestricted Subsidiaries. The Borrower may, at any time and upon written notice to the Administrative Agent, redesignate an Unrestricted Subsidiary as a Restricted Subsidiary. Further, promptly after the date on which the Borrower or the Administrative Agent determines that all Unrestricted Subsidiaries and their respective Subsidiaries represent ten percent (10%) or more of the Consolidated EBITDA of the Borrower and its Subsidiaries (notwithstanding the definition thereof, calculated to include all Unrestricted Subsidiaries) for the four (4) consecutive fiscal quarters most recently ended prior to such date, then the Borrower shall promptly identify in writing to the Administrative Agent such Unrestricted Subsidiaries to be redesignated as Restricted Subsidiaries to cause such remaining Unrestricted Subsidiaries and their Subsidiaries (after giving effect to such redesignation) to represent less than ten percent (10%) of the Consolidated EBITDA of the Borrower and its Subsidiaries (notwithstanding the definition thereof, calculated to include all Unrestricted Subsidiaries) for the four (4) consecutive fiscal quarters most recently ended prior to such date. 55 (d) Designation of Restricted Subsidiaries. So long as no Default or Event of Default has occurred and is continuing, the Borrower shall be permitted, on prior written notice to the Administrative Agent, to redesignate any Restricted Subsidiary as an Unrestricted Subsidiary (or designate any newly formed or acquired Subsidiary as an Unrestricted Subsidiary; provided that such formation or acquisition is otherwise permitted hereunder), so long as the Administrative Agent reasonably determines that at the time of such proposed designation (or redesignation, as applicable), and after giving effect thereto, all Unrestricted Subsidiaries and their respective Subsidiaries (including the Subsidiary and its respective Subsidiaries to be designated or redesignated, as applicable, as an Unrestricted Subsidiary) represent no more than ten percent (10%) of the Consolidated EBITDA of the Borrower and its Subsidiaries (notwithstanding the definition thereof, calculated to include all Unrestricted Subsidiaries) for the four (4) consecutive fiscal quarters most recently ended prior to such date. Such designation (or redesignation, as applicable) shall have an effective date mutually acceptable to the Administrative Agent and Borrower, but in no event earlier than five (5) Business Days following receipt by the Administrative Agent of such written notice. SECTION 9.12 Use of Proceeds. The Borrower shall use the proceeds of the Extensions of Credit (a) to finance the acquisition of Capital Assets, (b) to refinance the Existing Facility, (c) to fund Restricted Payments permitted hereunder, and (d) for working capital and general corporate requirements of the Borrower and its Subsidiaries and payment of certain fees and expenses incurred in connection with the transactions contemplated hereby. SECTION 9.13 Landlord Consents. Promptly after the Closing Date, the Borrower shall diligently pursue and use all reasonable efforts to obtain landlord consents, estoppel letters or consents and waivers, in form and substance reasonably acceptable to the Administrative Agent, in respect of Collateral held on leased premises. SECTION 9.14 Further Assurances. Make, execute and deliver all such additional and further acts, things, deeds and instruments as the Administrative Agent or the Required Lenders (through the Administrative Agent) may reasonably require to document and consummate the transactions contemplated hereby and to vest completely in and insure the Administrative Agent and the Lenders their respective rights under this Agreement, the Notes, the Letters of Credit and the other Loan Documents. ARTICLE X FINANCIAL COVENANTS Until all of the Obligations have been paid and satisfied in full and the Commitments terminated, unless consent has been obtained in the manner set forth in Section 14.11, the Borrower and its Restricted Subsidiaries on a Consolidated basis will not: SECTION 10.1 Leverage Ratios. (a) Total Leverage Ratio. As of any fiscal quarter end, permit the ratio (the "Total Leverage Ratio") of (i) the sum of (A) Debt of the Borrower and its Restricted Subsidiaries on such date (other than any Non-Recourse Project Financing Indebtedness), less (B) any undrawn Letters of Credit and cash on hand of the Borrower and its Restricted Subsidiaries, to (ii) EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date to be greater than the corresponding ratio set forth below: 56

PERIOD MAXIMUM RATIO ------ ------------- Closing Date through March 27, 2004 3.50 to 1.00 March 28, 2004 through September 25, 2004 3.25 to 1.00 September 26, 2004 through July 2, 2005 3.00 to 1.00 July 3, 2005 through July 1, 2006 2.75 to 1.00 July 2, 2006 and thereafter 2.50 to 1.00

(b) Senior Secured Leverage Ratio. As of any fiscal quarter end, permit the ratio (the "Senior Secured Leverage Ratio") of (i) the sum of (A) Debt of the Borrower incurred under this Agreement plus, without duplication, other secured Debt of the Borrower and the Restricted Subsidiaries on such date (other than any Non-Recourse Project Financing Indebtedness), less (B) any undrawn Letters of Credit and cash on hand of the Borrower and its Restricted Subsidiaries, to (ii) EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date to be greater than the corresponding ratio set forth below:

PERIOD MAXIMUM RATIO ------ ------------- Closing Date through September 25, 2004 1.75 to 1.00 September 26, 2004 and thereafter 1.50 to 1.00

SECTION 10.2 Fixed Charge Coverage Ratio. As of any fiscal quarter end, permit the ratio of (a) the sum of (i) EBITDA for the period of four (4) consecutive fiscal quarters ending on such date, plus (ii) Rental Expense (other than Rental Expense related to Synthetic Leases), less (iii) Capital Expenditures (excluding (x) the purchase of assets listed on Schedule 4.4(b)(iii), and (y) any acquisitions permitted under Section 11.3(a)), to (b) the sum of (i) Interest Expense paid in cash, (ii) any federal, state or local income taxes paid in cash (excluding cash taxes paid in respect of the sale of PCG) by the Borrower and its Restricted Subsidiaries, (iii) scheduled principal payments required to be made by the Borrower and its Restricted Subsidiaries with respect to Debt, (iv) Rental Expense (other than Rental Expense related to Synthetic Leases) and (v) Restricted Payments (excluding payments for the repurchase of Parent Shares permitted pursuant to Section 11.6), in each case for the period of four (4) consecutive fiscal quarters ending on such date to be less than 1.10 to 1.00. SECTION 10.3 Capital Expenditures. Permit Capital Expenditures to be greater than $10,000,000 in the aggregate during any Fiscal Year; provided, however, any acquisition permitted under Section 11.3(a) shall not be included in the calculation of Capital Expenditures. Notwithstanding the foregoing, the maximum amount of Capital Expenditures permitted by this Section 10.3 in any Fiscal Year shall be increased by the amount of Capital Expenditures that were permitted to be made under this Section 10.3 in the immediately preceding Fiscal Year (without giving effect to any carryover amount from prior Fiscal Years) over the amount of Capital Expenditures actually made during such preceding Fiscal Year. SECTION 10.4 Minimum Net Worth. As of any fiscal quarter end, permit Net Worth for the fiscal quarter ending on or immediately prior to such date to be less than the sum of (a) $140,000,000, plus (b) the net gain from the sale of PCG, less (c) the amount of the Share Purchase, plus (d) an amount equal to fifty percent (50%) of the Consolidated Net Income earned in each full fiscal quarter ending after the Closing Date (with no deduction for a net loss in any such fiscal quarter), plus (e) an amount equal to 57 fifty percent (50%) of the aggregate increases in Consolidated shareholders' equity of the Borrower and its Restricted Subsidiaries after the Closing Date by reason of the issuance and sale of capital stock or other equity interests of the Borrower or any Restricted Subsidiary (other than issuances to the Borrower or a Wholly-Owned Restricted Subsidiary), including upon any conversion of debt securities of the Borrower into such capital stock or other equity interests. ARTICLE XI NEGATIVE COVENANTS Until all of the Obligations have been paid and satisfied in full and the Commitments terminated, unless consent has been obtained in the manner set forth in Section 14.11, the Borrower has not and will not and will not permit any of its Restricted Subsidiaries to: SECTION 11.1 Limitations on Debt. Create, incur, assume or suffer to exist any Debt except: (a) the Obligations (excluding Hedging Agreements permitted pursuant to Section 11.1(b)); (b) Debt incurred in connection with a Hedging Agreement with a counterparty and upon terms and conditions (including interest rate) reasonably satisfactory to the Administrative Agent; provided, that any counterparty that is a Lender shall be deemed satisfactory to the Administrative Agent; (c) (i) Debt existing on the Closing Date and not otherwise permitted under this Section 11.1, as set forth on Schedule 7.1(t), and the renewal, refinancing, extension and replacement (but not the increase in the aggregate principal amount) thereof, (ii) any Non-Recourse Project Financing Indebtedness and (iii) the Senior Unsecured Debt and the renewal, refinancing, extension and replacement (but not the increase in the aggregate principal amount or any decrease in the weighted average life) thereof; (d) Debt of the Borrower and its Restricted Subsidiaries incurred in connection with Capitalized Leases in an aggregate amount not to exceed $3,000,000 on any date of determination; (e) purchase money Debt of the Borrower and its Restricted Subsidiaries in an aggregate amount not to exceed $3,000,000 on any date of determination; (f) Guaranty Obligations in favor of the Administrative Agent for the benefit of the Administrative Agent and the Lenders; (g) Debt in an aggregate principal amount not to exceed $5,000,000 at any time outstanding; (h) Debt arising from intercompany loans from the Borrower to any Restricted Subsidiary or from any Restricted Subsidiary to the Borrower; and (i) Guaranty Obligations of the Borrower and its Restricted Subsidiaries with respect to Debt permitted pursuant to this Section 11.1. provided, that (x) no agreement or instrument with respect to Debt permitted to be incurred by this Section (other than the High-Yield Note Indenture) shall restrict, limit or otherwise encumber (by covenant or otherwise) the ability of any Subsidiary of the Borrower to make any payment to the Borrower or any of its Subsidiaries (in the form of dividends, intercompany advances or otherwise) for 58 the purpose of enabling the Borrower to pay the Obligations and (y) in no event shall WIH incur, assume or suffer to exist any Debt. SECTION 11.2 Limitations on Liens. Create, incur, assume or suffer to exist, any Lien on or with respect to any of its assets or properties (including, without limitation, shares of capital stock or other ownership interests), real or personal, whether now owned or hereafter acquired, except: (a) Liens for taxes, assessments and other governmental charges or levies (excluding any Lien imposed pursuant to any of the provisions of ERISA or Environmental Laws) not yet due or as to which the period of grace, if any, related thereto has not expired or which are being contested in good faith and by appropriate proceedings if adequate reserves are maintained to the extent required by GAAP; (b) the claims of materialmen, mechanics, carriers, warehousemen, processors or landlords for labor, materials, supplies or rentals incurred in the ordinary course of business, (i) which are not overdue for a period of more than thirty (30) days or (ii) which are being contested in good faith and by appropriate proceedings; (c) Liens consisting of deposits or pledges made in the ordinary course of business in connection with, or to secure payment of, obligations under workers' compensation, unemployment insurance or similar legislation; (d) Liens constituting encumbrances in the nature of zoning restrictions, easements and rights or restrictions of record on the use of real property, which in the aggregate are not substantial in amount and which do not, in any case, materially detract from the value of such property or impair the use thereof in the ordinary conduct of business; (e) Liens of the Administrative Agent for the benefit of the Administrative Agent and the Lenders; (f) Liens not otherwise permitted by this Section 11.2 and in existence on the Closing Date and described on Schedule 11.2, and any renewals or extensions thereof, provided that the property covered thereby is not increased and any renewal or extension of the obligations secured or benefited thereby is permitted by Section 11.1(c)(i); (g) Liens securing Debt permitted under Sections 11.1(d) and (e); provided that (i) such Liens shall be created substantially simultaneously with the acquisition or lease of the related asset, (ii) such Liens do not at any time encumber any property other than the property financed by such Debt, (iii) the amount of Debt secured thereby is not increased and (iv) the principal amount of Debt secured by any such Lien shall at no time exceed one hundred percent (100%) of the original purchase price or lease payment amount of such property at the time it was acquired; (h) other Liens securing Debt permitted by Section 11.1(g), not to exceed $2,000,000 in the aggregate; and (i) Liens securing Non-Recourse Project Financing Indebtedness. SECTION 11.3 Limitations on Loans, Advances, Investments and Acquisitions. Purchase, own, invest in or otherwise acquire, directly or indirectly, any capital stock, interests in any partnership or joint venture (including, without limitation, the creation or capitalization of any Restricted Subsidiary), evidence of Debt or other obligation or security, substantially all of the business or assets of any other 59 Person or any other investment or interest whatsoever in any other Person, or make or permit to exist, directly or indirectly, any loans, advances or extensions of credit to, or any investment in cash or by delivery of property in, any Person except: (a) (i) investments in or loans, advances or extensions of credit to, Subsidiaries existing on the Closing Date, (ii) investments in or loans, advances or extensions of credit to, Restricted Subsidiaries formed or acquired after the Closing Date so long as the Borrower and its Subsidiaries comply with the applicable provisions of Section 9.11, (iii) Permitted Acquisitions after the Closing Date so long as the Borrower and its Subsidiaries comply with the applicable provisions of Section 9.11, provided that any investment by the Borrower or any Restricted Subsidiary in any Restricted Foreign Subsidiary (other than any investment made from the Net Cash Proceeds of the sale of PCG) must be (x) in the form of a loan to such Restricted Foreign Subsidiary which is pledged to the Administrative Agent pursuant to the Collateral Agreement or (y) made from the proceeds of newly-issued preferred stock of WIH having a liquidation preference at least equal to 85% of the amount of such investment which is pledged to the Administrative Agent pursuant to the Collateral Agreement, and (iv) the other loans, advances and investments described on Schedule 11.3 existing on the Closing Date; (b) investments in (i) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency thereof maturing within one hundred twenty (120) days from the date of acquisition thereof, (ii) commercial paper maturing no more than one hundred twenty (120) days from the date of creation thereof and currently having an A-1 or higher rating from S&P or a P-1 rating from Moody's, (iii) certificates of deposit maturing no more than one hundred twenty (120) days from the date of creation thereof issued by commercial banks incorporated under the laws of the United States, each having combined capital, surplus and undivided profits of not less than $500,000,000 and having a rating of "A" or better by a nationally recognized rating agency; provided, that the aggregate amount invested in such certificates of deposit shall not at any time exceed $5,000,000 for any one such certificate of deposit and $10,000,000 for any one such bank, (iv) money market accounts rated AAA or A-1 or higher from S&P or P-1 or Aaa from Moody's, (v) time deposits maturing no more than thirty (30) days from the date of creation thereof with commercial banks or savings banks or savings and loan associations each having membership either in the FDIC or the deposits of which are insured by the FDIC and in amounts not exceeding the maximum amounts of insurance thereunder, or (vi) municipal securities rated investment grade or better by either S&P or Moody's; (c) Hedging Agreements permitted pursuant to Section 11.1; (d) purchases of assets in the ordinary course of business; (e) to the extent they constitute an investment, contributions to and payments of benefits under any Employee Benefits Plan in existence as of the Closing Date as required by the benefit commitment in such Employee Benefits Plan as of the Closing Date; (f) investments, loans, advances or extensions of credit in addition to those permitted elsewhere in this Section 11.3 in an aggregate amount not to exceed $2,000,000 in the aggregate at any time outstanding; and (g) investments in or loans, advances or extensions of credit to Unrestricted Subsidiaries and/or joint ventures in an amount not to exceed $10,000,000 during the term of this Agreement. 60 SECTION 11.4 Limitations on Mergers and Liquidation. Merge, consolidate or enter into any similar combination with any other Person or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution) except: (a) any Subsidiary of the Borrower may merge with the Borrower or any Restricted Subsidiary; provided that in any merger involving the Borrower or a Restricted Subsidiary, the Borrower or such Restricted Subsidiary shall be the surviving entity; (b) any Restricted Subsidiary of the Borrower may merge into the Person such Restricted Subsidiary was formed to acquire in connection with an acquisition permitted by Section 11.3(a); provided that the Restricted Subsidiary shall be the continuing or surviving Person or the survivor shall comply with the requirements of Section 9.11; and (c) any Restricted Subsidiary may wind-up into the Borrower or any other Restricted Subsidiary. SECTION 11.5 Limitations on Sale of Assets. Convey, sell, lease, assign, transfer or otherwise dispose of any of its property, business or assets (including, without limitation, the sale of any receivables and leasehold interests and any sale-leaseback or similar transaction), whether now owned or hereafter acquired except: (a) the sale of inventory in the ordinary course of business; (b) the sale of obsolete assets no longer used or usable in the business of the Borrower or any of its Subsidiaries; (c) the transfer of assets to the Borrower or any Restricted Subsidiary pursuant to Section 11.4(c); (d) the sale or discount without recourse of accounts receivable arising in the ordinary course of business in connection with the compromise or collection thereof; (e) the disposition of any Hedging Agreement; (f) the sale or other disposition of assets by the Borrower or any Restricted Subsidiary not otherwise permitted under this Section 11.5; provided that (i) as of the time of such sale or other disposition, no Default or Event of Default shall be continuing or would result therefrom, (ii) the aggregate book value of all assets sold or disposed of pursuant to this clause (f) in any Fiscal Year shall not exceed $5,000,000, and (iii) the Borrower shall have complied with the requirements of Section 4.4(b); (g) the sale of any investments permitted under Section 11.3(b) hereof; and (h) the sale of those assets listed on Schedule 4.4(b)(iii). SECTION 11.6 Restricted Payments. Declare, pay or make any Restricted Payment except: (a) each Restricted Subsidiary may make Restricted Payments to the Borrower and to Restricted Subsidiaries; and (b) the Borrower shall be allowed to make the Share Purchase. 61 SECTION 11.7 Limitations on Exchange and Issuance of Capital Stock. Issue, sell or otherwise dispose of any class or series of capital stock that, by its terms or by the terms of any security into which it is convertible or exchangeable, is, or upon the happening of an event or passage of time would be, (a) convertible or exchangeable into Debt or (b) required to be redeemed or repurchased, including at the option of the holder, in whole or in part, or has, or upon the happening of an event or passage of time would have, a redemption or similar payment due. SECTION 11.8 Transactions with Affiliates. Except for transactions permitted by 11.1, 11.3, 11.6 and 11.7, directly or indirectly (a) make any loan or advance to, or purchase or assume any note or other obligation to or from, any of its officers, directors, shareholders or other Affiliates, or to or from any member of the immediate family of any of its officers, directors, shareholders or other Affiliates, or subcontract any operations to any of its Affiliates or (b) enter into, or be a party to, any other transaction not described in clause (a) above with any of its Affiliates, except pursuant to the reasonable requirements of its business and upon fair and reasonable terms that are no less favorable to it than it would obtain in a comparable arm's length transaction with a Person not its Affiliate. SECTION 11.9 Certain Accounting Changes; Organizational Documents. (a) Change its Fiscal Year end, or make any change in its accounting treatment and reporting practices except as required by GAAP or (b) amend, modify or change its articles of incorporation (or corporate charter or other similar organizational documents) or amend, modify or change its bylaws (or other similar documents) in any manner adverse in any respect to the rights or interests of the Lenders. SECTION 11.10 Amendments; Payments and Prepayments of Certain Debt. Amend or modify (or permit the modification or amendment of) any of the terms or provisions of any Subordinated Debt, or cancel or forgive, make any voluntary or optional payment or prepayment on, or redeem or acquire for value (including, without limitation, by way of depositing with any trustee with respect thereto money or securities before due for the purpose of paying when due) any Subordinated Debt or Senior Unsecured Debt. SECTION 11.11 Restrictive Agreements. (a) Enter into any Debt which contains any negative pledge on assets or any covenants more restrictive than the provisions of Articles IX, X and XI hereof, or which restricts, limits or otherwise encumbers its ability to incur Liens (except for restrictions on Liens pursuant to the High-Yield Note Indenture) on or with respect to any of its assets or properties other than the assets or properties securing such Debt. (b) Enter into or permit to exist any agreement which impairs or limits the ability of any Restricted Subsidiary of the Borrower to pay dividends to the Borrower. SECTION 11.12 Nature of Business. Alter the character or conduct of the business conducted by the Borrower and its Restricted Subsidiaries as of the Closing Date. SECTION 11.13 Impairment of Security Interests. (a) Take or omit to take any action, which might or would have the result of materially impairing the security interests in favor of the Administrative Agent with respect to the Collateral or grant to any Person (other than the Administrative Agent for the benefit of itself and the Lenders pursuant to the Security Documents) any interest whatsoever in the Collateral, except for Liens permitted under Section 11.2 and asset sales permitted under Section 11.5, or (b) permit any Person other than the Borrower to own any capital stock of WIH. 62 ARTICLE XII DEFAULT AND REMEDIES SECTION 12.1 Events of Default. Each of the following shall constitute an Event of Default, whatever the reason for such event and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment or order of any court or any order, rule or regulation of any Governmental Authority or otherwise: (a) Default in Payment of Principal of Loans and Reimbursement Obligations. The Borrower shall default in any payment of principal of any Loan, Note or Reimbursement Obligation when and as due (whether at maturity, by reason of acceleration or otherwise). (b) Other Payment Default. The Borrower shall default in the payment when and as due (whether at maturity, by reason of acceleration or otherwise) of interest on any Loan, Note or Reimbursement Obligation or the payment of any other Obligation, and such default shall continue for a period of three (3) Business Days. (c) Misrepresentation. Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the Borrower or any Restricted Subsidiary under this Agreement, any other Loan Document, or in any document delivered in connection herewith or therewith that is subject to materiality or Material Adverse Effect qualifications, shall be incorrect or misleading in any respect when made or deemed made or any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the Borrower or any Restricted Subsidiary herein, any other Loan Document, or in any document delivered in connection herewith or therewith that is not subject to materiality or Material Adverse Effect qualifications, shall be incorrect or misleading in any material respect when made or deemed made. (d) Default in Performance of Certain Covenants. The Borrower shall default in the performance or observance of any covenant or agreement contained in Sections 8.1, 8.2, 8.5(e)(i), 9.10, 9.11 or 9.13 or Articles X or XI of this Agreement. (e) Default in Performance of Other Covenants and Conditions. The Borrower or any Subsidiary thereof shall default in the performance or observance of any term, covenant, condition or agreement contained in this Agreement (other than as specifically provided for otherwise in this Section 12.1) or any other Loan Document and such default shall continue for a period of thirty (30) days after written notice thereof has been given to the Borrower by the Administrative Agent. (f) Hedging Agreement. The Borrower shall default in the performance or observance of any terms, covenant, condition or agreement (after giving effect to any applicable grace or cure period) under any Hedging Agreement and such default causes the termination of such Hedging Agreement or permits any counterparty to such Hedging Agreement to terminate any such Hedging Agreement. (g) Debt Cross-Default. The Borrower or any of its Subsidiaries shall (i) default in the payment of any Debt (other than the Notes or any Reimbursement Obligation) the aggregate outstanding amount of which Debt is in excess of $2,000,000 beyond the period of grace if any, provided in the instrument or agreement under which such Debt was created, or (ii) default in the observance or performance of any other agreement or condition relating to any Debt (other than the Notes or any Reimbursement Obligation) the aggregate outstanding amount of which Debt is in excess of $2,000,000 or contained in any instrument or agreement evidencing, securing or relating thereto or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to 63 permit the holder or holders of such Debt (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice if required, any such Debt to become due prior to its stated maturity (any applicable grace period having expired). (h) Change in Control. Any person or group of persons (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended) shall obtain ownership or control in one or more series of transactions of more than thirty percent (30%) of the common stock or thirty percent (30%) of the voting power of the Borrower entitled to vote in the election of members of the board of directors of the Borrower or there shall have occurred under any indenture or other instrument evidencing any Debt in excess of $2,000,000 any "change in control" (as defined in such indenture or other evidence of Debt) obligating the Borrower to repurchase, redeem or repay all or any part of the Debt or capital stock provided for therein (any such event, a "Change in Control"). (i) Voluntary Bankruptcy Proceeding. The Borrower or any Subsidiary thereof shall (i) commence a voluntary case under the federal bankruptcy laws (as now or hereafter in effect), (ii) file a petition seeking to take advantage of any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or composition for adjustment of debts, (iii) consent to or fail to contest in a timely and appropriate manner any petition filed against it in an involuntary case under such bankruptcy laws or other laws, (iv) apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign, (v) admit in writing its inability to pay its debts as they become due, (vi) make a general assignment for the benefit of creditors, or (vii) take any corporate action for the purpose of authorizing any of the foregoing. (j) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced against the Borrower or any Subsidiary thereof in any court of competent jurisdiction seeking (i) relief under the federal bankruptcy laws (as now or hereafter in effect) or under any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or adjustment of debts, or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like for the Borrower or any Subsidiary thereof or for all or any substantial part of their respective assets, domestic or foreign, and such case or proceeding shall continue without dismissal or stay for a period of sixty (60) consecutive days, or an order granting the relief requested in such case or proceeding (including, but not limited to, an order for relief under such federal bankruptcy laws) shall be entered. (k) Failure of Agreements. Any provision of this Agreement or any provision of any other Loan Document shall for any reason cease to be valid and binding on the Borrower or Subsidiary party thereto or any such Person shall so state in writing, or any Loan Document shall for any reason cease to create a valid and perfected first priority Lien on, or security interest in, any of the collateral purported to be covered thereby, in each case other than in accordance with the express terms hereof or thereof. (l) Termination Event. The occurrence of any of the following events: (i) the Borrower or any ERISA Affiliate fails to make full payment when due of all amounts which, under the provisions of any Pension Plan or Section 412 of the Code, the Borrower or any ERISA Affiliate is required to pay as contributions thereto, (ii) an accumulated funding deficiency in excess of $1,000,000 occurs or exists, whether or not waived, with respect to any Pension Plan, (iii) a Termination Event or (iv) the Borrower or any ERISA Affiliate as employers under one or more Multiemployer Plans makes a complete or partial withdrawal from any such Multiemployer Plan and the plan sponsor of such Multiemployer Plans notifies such withdrawing employer that such employer has incurred a withdrawal liability requiring payments in an amount exceeding $1,000,000. 64 (m) Judgment. A judgment or order for the payment of money which causes the aggregate amount of all such judgments to exceed $2,000,000 in any Fiscal Year shall be entered against the Borrower or any of its Subsidiaries by any court and such judgment or order shall continue without discharge or stay or shall not be bonded for a period of thirty (30) days. (n) Environmental. Any one or more Environmental Claims shall have been asserted against the Borrower or any of its Subsidiaries; the Borrower and its Subsidiaries would be reasonably likely to incur liability as a result thereof; and such liability could be reasonably expected, individually or in the aggregate, to have a Material Adverse Effect. SECTION 12.2 Remedies. Upon the occurrence of an Event of Default, with the consent of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower: (a) Acceleration; Termination of Facilities. Declare the principal of and interest on the Loans, the Notes and the Reimbursement Obligations at the time outstanding, and all other amounts owed to the Lenders and to the Administrative Agent under this Agreement or any of the other Loan Documents (including, without limitation, all L/C Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented or shall be entitled to present the documents required thereunder) and all other Obligations (other than Hedging Obligations), to be forthwith due and payable, whereupon the same shall immediately become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived, anything in this Agreement or the other Loan Documents to the contrary notwithstanding, and terminate the Credit Facility and any right of the Borrower to request borrowings or Letters of Credit thereunder; provided, that upon the occurrence of an Event of Default specified in Section 12.1(i) or (j), the Credit Facility shall be automatically terminated and all Obligations (other than Hedging Obligations) shall automatically become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived, anything in this Agreement or in any other Loan Document to the contrary notwithstanding. (b) Letters of Credit. With respect to all Letters of Credit with respect to which presentment for honor shall not have occurred at the time of an acceleration pursuant to the preceding paragraph, the Borrower shall at such time deposit in a cash collateral account opened by the Administrative Agent an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit (which such cash collateral shall be deposited in the applicable Permitted Currency in which each Letter of Credit is denominated). Amounts held in such cash collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit, and the unused portion thereof after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay the other Obligations on a pro rata basis. After all such Letters of Credit shall have expired or been fully drawn upon, the Reimbursement Obligation shall have been satisfied and all other Obligations shall have been paid in full, the balance, if any, in such cash collateral account shall be returned to the Borrower. (c) Rights of Collection. Exercise on behalf of the Lenders all of its other rights and remedies under this Agreement, the other Loan Documents and Applicable Law, in order to satisfy all of the Borrower's Obligations. SECTION 12.3 Rights and Remedies Cumulative; Non-Waiver; etc. The enumeration of the rights and remedies of the Administrative Agent and the Lenders set forth in this Agreement is not intended to be exhaustive and the exercise by the Administrative Agent and the Lenders of any right or remedy shall not preclude the exercise of any other rights or remedies, all of which shall be cumulative, and shall be in addition to any other right or remedy given hereunder or under the other Loan Documents or that may now or hereafter exist at law or in equity or by suit or otherwise. No delay or failure to take 65 action on the part of the Administrative Agent or any Lender in exercising any right, power or privilege shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege preclude any other or further exercise thereof or the exercise of any other right, power or privilege or shall be construed to be a waiver of any Event of Default. No course of dealing between the Borrower, the Administrative Agent and the Lenders or their respective agents or employees shall be effective to change, modify or discharge any provision of this Agreement or any of the other Loan Documents or to constitute a waiver of any Event of Default. SECTION 12.4 Judgment Currency. The obligation of the Borrower to make payments of any amounts payable hereunder or pursuant to any other Loan Document in the currency specified for such payment shall not be discharged or satisfied by any tender, or any recovery pursuant to any judgment, which is expressed in or converted into any other currency, except to the extent that such tender or recovery shall result in the actual receipt by each of the Administrative Agent and Lenders of the full amount of the particular Permitted Currency expressed to be payable pursuant to the applicable Loan Document. The Administrative Agent shall, using all amounts obtained or received from the Borrower pursuant to any such tender or recovery in payment of principal of and interest on the Obligations, promptly purchase the applicable currency at the most favorable spot exchange rate determined by the Administrative Agent to be available to it. The obligation of the Borrower to make payments in the applicable currency shall be enforceable as an alternative or additional cause of action solely for the purpose of recovering in the applicable currency the amount, if any, by which such actual receipt shall fall short of the full amount of the currency expressed to be payable pursuant to the applicable Loan Document. ARTICLE XIII THE AGENTS SECTION 13.1 Appointment. Each of the Lenders hereby irrevocably designates and appoints BNP Paribas as Administrative Agent of such Lender under this Agreement and the other Loan Documents for the term hereof and each such Lender irrevocably authorizes BNP Paribas, as Administrative Agent for such Lender, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of this Agreement and such other Loan Documents, together with such other powers as are reasonably incidental thereto. BNP Paribas is hereby appointed by each of the Lenders as its contractual representative to serve as the sole and exclusive Syndication Agent hereunder and under each other Loan Document, and each of the Lenders irrevocably authorizes the Syndication Agent to act as the contractual representative of such Lender with the rights and duties expressly set forth herein and in the other Loan Documents. The Agents agree to act as such contractual representatives upon the express conditions contained in this Article XIII. Notwithstanding any provision to the contrary elsewhere in this Agreement or such other Loan Documents, the Administrative Agent and the Syndication Agent shall not have any duties or responsibilities, except those expressly set forth herein and therein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or the other Loan Documents or otherwise exist against the Administrative Agent. Any reference to the Administrative Agent in this Article XIII shall be deemed to refer to the Administrative Agent solely in its capacity as Administrative Agent and not in its capacity as a Lender. SECTION 13.2 Delegation of Duties. The Agents may execute any of their respective duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Agents shall not be 66 responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by the Agents with reasonable care. SECTION 13.3 Exculpatory Provisions. Neither the Agents nor any of their officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates shall be (a) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or the other Loan Documents (except for actions occasioned solely by its or such Person's own gross negligence or willful misconduct), or (b) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any of its Subsidiaries or any officer thereof contained in this Agreement or the other Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by either Agent under or in connection with, this Agreement or the other Loan Documents or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or the other Loan Documents or for any failure of the Borrower or any of its Subsidiaries to perform its obligations hereunder or thereunder. The Agents shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement, or to inspect the properties, books or records of the Borrower or any of its Subsidiaries. SECTION 13.4 Reliance by the Agents. Each Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower), independent accountants and other experts selected by such Agent. The Agents may deem and treat the payee of any Note as the owner thereof for all purposes unless such Note shall have been transferred in accordance with Section 14.10. The Agents shall be fully justified in failing or refusing to take any action under this Agreement and the other Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders (or, when expressly required hereby or by the relevant other Loan Documents, all the Lenders) as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action except for its own gross negligence or willful misconduct. The Agents shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the Notes in accordance with a request of the Required Lenders (or, when expressly required hereby, all the Lenders), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Notes. SECTION 13.5 Notice of Default. Neither of the Agents shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default (except with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Lenders) unless it has received notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a "notice of default". In the event that either of the Agents receives such a notice, it shall promptly give notice thereof to the Lenders. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or, when expressly required hereby, all the Lenders); provided that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders, except to the extent that other provisions of this Agreement expressly require that any such action be taken or not be taken only with the consent and authorization or the request of the Lenders or Required Lenders, as applicable. 67 SECTION 13.6 Non-Reliance on the Agents and Other Lenders. Each Lender expressly acknowledges that neither Agent nor any of its respective officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates has made any representations or warranties to it and that no act by an Agent hereafter taken, including any review of the affairs of the Borrower or any of its Subsidiaries, shall be deemed to constitute any representation or warranty by the Agent to any Lender. Each Lender represents to the Agents that it has, independently and without reliance upon the Agents or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Borrower and its Subsidiaries and made its own decision to make its Loans and issue or participate in Letters of Credit hereunder and enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Agents or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower and its Subsidiaries. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Agents hereunder or by the other Loan Documents, the Agents shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, property, financial and other condition or creditworthiness of the Borrower or any of its Subsidiaries which may come into the possession of the Agents or any of their respective officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates. SECTION 13.7 Indemnification. The Lenders agree to indemnify the Agents in their capacity as such and (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to the respective amounts of their Revolving Credit Commitment Percentages or Term Loan Percentages, as applicable, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including, without limitation, at any time following the payment of the Notes or any Reimbursement Obligation) be imposed on, incurred by or asserted against either Agent in any way relating to or arising out of this Agreement or the other Loan Documents, or any documents, reports or other information provided to the Agents or any Lender or contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the an Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the Agent's bad faith, gross negligence or willful misconduct. The agreements in this Section 13.7 shall survive the payment of the Notes, any Reimbursement Obligation and all other amounts payable hereunder and the termination of this Agreement. SECTION 13.8 The Agents in Their Individual Capacities. The Agents and their respective Subsidiaries and Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower as though the Agents were not the Agents hereunder. With respect to any Loans made or renewed by it and any Note issued to it and with respect to any Letter of Credit issued by it or participated in by it, each Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not an Agent, and the terms "Lender" and "Lenders" shall include the Agents in their individual capacities. SECTION 13.9 Resignation of the Agents; Successor Agents. Subject to the appointment and acceptance of a successor as provided below, the Agents may resign at any time by giving notice thereof to the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have the right to appoint a successor Administrative Agent or Syndication Agent, as applicable, which successor shall have 68 minimum capital and surplus of at least $500,000,000. If no successor Administrative Agent or Syndication Agent, as applicable, shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after such Agent's giving of notice of resignation, then the Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent or Syndication Agent, as applicable, which successor shall have minimum capital and surplus of at least $500,000,000. Upon the acceptance of any appointment as Administrative Agent or Syndication Agent, as applicable, hereunder by a successor Administrative Agent or Syndication Agent, as applicable, such successor Administrative Agent or Syndication Agent, as applicable, shall thereupon succeed to and become vested with all rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations hereunder. After any retiring Agent's resignation hereunder as Administrative Agent or Syndication Agent, as applicable, the provisions of this Section 13.9 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Administrative Agent or Syndication Agent, as applicable. ARTICLE XIV MISCELLANEOUS SECTION 14.1 Notices. (a) Method of Communication. Except as otherwise provided in this Agreement, all notices and communications hereunder shall be in writing (for purposes hereof, the term "writing" shall include information in electronic format such as electronic mail and internet web pages), or by telephone subsequently confirmed in writing. Any notice shall be effective if delivered by hand delivery or sent via electronic mail, posting on an internet web page, telecopy, recognized overnight courier service or certified mail, return receipt requested, and shall be presumed to be received by a party hereto (i) on the date of delivery if delivered by hand or sent by electronic mail, posting on an internet web page (provided the recipients of such notice have been made specifically aware of the posting of such notice by any other method permitted by this Section 14.1(a)), or telecopy, (ii) on the next Business Day if sent by recognized overnight courier service and (iii) on the third Business Day following the date sent by certified mail, return receipt requested. A telephonic notice to the Administrative Agent as understood by the Administrative Agent will be deemed to be the controlling and proper notice in the event of a discrepancy with or failure to receive a confirming written notice. (b) Addresses for Notices. Notices to any party shall be sent to it at the following addresses, or any other address as to which all the other parties are notified in writing. If to the Borrower: Wackenhut Corrections Corporation One Park Place 621 NW 53rd Street Suite 700 Boca Raton, Florida 33487 Attention: John O'Rourke Telephone No.: 561-999-7401 Telecopy No.: 561-999-7742 69 With copies to: Akerman Senterfitt One Southeast Third Avenue 28th Floor Miami, Florida 33131-1714 Attention: Stephen K. Roddenberry, Esq. Telephone No.: 305-374-5600 Telecopy No.: 305-374-5095 And Wackenhut Corrections Corporation One Park Place 621 NW 53rd Street Suite 700 Boca Raton, Florida 33487 Attention: John Bulfin, General Counsel Telephone No.: 591-622-5656 Telecopy No.: 561-691-6777 If to BNP Paribas as in the case of any Notice of Borrowing, Administrative Agent: Notice of Continuation/Conversion, Notice or Prepayment or other routine administrative notice, to: BNP Paribas 787 Seventh Avenue New York, New York 10019 Attention: James Broadus Telephone No.: 212-471-6630 Telecopy No.: 212-471-6603 in all other cases, to: BNP Paribas 31st Floor 787 Seventh Avenue New York, New York 10019 Attention: Shayn March Telephone No.: 212-841-3938 Telecopy No.: 212-841-3830 With copies to: BNP Paribas 31st Floor 787 Seventh Avenue New York, New York 10019 Attention: Duane Helkowski Telephone No.: 212-841-2940 Telecopy No.: 212-841-3830 70 If to BNP Paribas as BNP Paribas Syndication Agent: 31st Floor 787 Seventh Avenue New York, New York 10019 Attention: Shayn March Telephone No.: 212-841-3938 Telecopy No.: 212-841-3830 With copies to: BNP Paribas 31st Floor 787 Seventh Avenue New York, New York 10019 Attention: Duane Helkowski Telephone No.: 212-841-2940 Telecopy No.: 212-841-3830 If to any Lender: To the address referred to on the Register. (c) Administrative Agent's Office. The Administrative Agent hereby designates its office located at the address set forth above, or any subsequent office which shall have been specified for such purpose by written notice to the Borrower and Lenders, as the Administrative Agent's Office referred to herein, to which payments due are to be made and at which Loans will be disbursed and Letters of Credit issued. SECTION 14.2 Expenses; Indemnity. The Borrower will (a) pay all reasonable out-of-pocket expenses (including, without limitation, all costs of electronic or internet distribution of any information hereunder) of the Administrative Agent in connection with (i) the preparation, execution and delivery of this Agreement and each other Loan Document, whenever the same shall be executed and delivered, including, without limitation, all reasonable out-of-pocket syndication and due diligence expenses and reasonable fees and disbursements of counsel for the Administrative Agent and (ii) the preparation, execution and delivery of any waiver, amendment or consent by the Administrative Agent or the Lenders relating to this Agreement or any other Loan Document, including, without limitation, reasonable fees and disbursements of counsel for the Administrative Agent, (b) pay all reasonable out-of-pocket expenses of the Administrative Agent and each Lender actually incurred in connection with the administration and enforcement of any rights and remedies of the Administrative Agent and Lenders under the Credit Facility, including, without limitation, in connection with any workout, restructuring, bankruptcy or other similar proceeding, creating and perfecting Liens in favor of Administrative Agent on behalf of Lenders pursuant to any Security Document, enforcing any Obligations of, or collecting any payments due from, the Borrower or any Guarantor by reason of an Event of Default (including in connection with the sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty Agreement; consulting with appraisers, accountants, engineers, attorneys and other Persons concerning the nature, scope or value of any right or remedy of the Administrative Agent or any Lender hereunder or under any other Loan Document or any factual matters in connection therewith, which expenses shall include without limitation the reasonable fees and disbursements of such Persons, and (c) defend, indemnify and hold harmless the Administrative Agent and the Lenders, and their respective parents, Subsidiaries, Affiliates, employees, agents, trustees, officers and directors, from and against any losses, penalties, fines, liabilities, settlements, damages, costs and expenses, suffered by any such Person in connection with any claim (including, without limitation, any Environmental Claims), investigation, litigation or other proceeding (whether or not the Administrative Agent or any Lender is a party thereto) and the prosecution and defense thereof, arising out of or in any way connected with the Loans, this Agreement, any other Loan Document, or any documents, reports or other information provided to the 71 Administrative Agent or any Lender or contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby, including, without limitation, reasonable attorney's and consultant's fees, except to the extent that any of the foregoing directly result from the gross negligence or willful misconduct of the party seeking indemnification therefor. SECTION 14.3 Set-off. (a) In addition to any rights now or hereafter granted under Applicable Law and not by way of limitation of any such rights, upon and after the occurrence of any Event of Default and during the continuance thereof, the Lenders and any assignee or participant of a Lender in accordance with Section 14.10 are hereby authorized by the Borrower at any time or from time to time, without notice to the Borrower or to any other Person, any such notice being hereby expressly waived, to set off and to appropriate and to apply any and all deposits (general or special, time or demand, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured) and any other indebtedness at any time held or owing by the Lenders, or any such assignee or participant to or for the credit or the account of the Borrower against and on account of the Obligations irrespective of whether or not (a) the Lenders shall have made any demand under this Agreement or any of the other Loan Documents or (b) the Administrative Agent shall have declared any or all of the Obligations to be due and payable as permitted by Section 12.2 and although such Obligations shall be contingent or unmatured. Notwithstanding the preceding sentence, each Lender agrees to notify the Borrower and the Administrative Agent after any such set-off and application, provided that the failure to give such notice shall not affect the validity of such set-off and application. (b) Any amount to be set-off pursuant to Section 14.3(a) shall be denominated in Dollars and any amount denominated in an Alternative Currency shall be in an amount equal to the Dollar Amount of such amount at the most favorable spot exchange rate determined by the Administrative Agent to be available to it; provided that if at the time of any such determination no such spot exchange rate can reasonably be determined, the Administrative Agent may use any reasonable method as it deems applicable to determine such rate, any such determination to be conclusive absent manifest error. (c) Each Lender and any assignee or participant of such Lender in accordance with Section 14.10 are hereby authorized by the Borrower to combine currencies, as deemed necessary by such Person, in order to effect any set-off pursuant to Section 14.3(a). SECTION 14.4 Governing Law. This Agreement, the Notes and the other Loan Documents, unless otherwise expressly set forth therein, shall be governed by, construed and enforced in accordance with the laws of the State of New York (including Section 5-1401 and Section 5-1402 of the General Obligations Law of the State of New York), without regard to the conflicts of law provisions of such state. SECTION 14.5 Jurisdiction and Venue. (a) Jurisdiction. The Borrower hereby irrevocably consents to the personal jurisdiction of the state and federal courts located in New York, New York (and any courts from which an appeal from any of such courts must or may be taken), in any action, claim or other proceeding arising out of any dispute in connection with this Agreement, the Notes and the other Loan Documents, any rights or obligations hereunder or thereunder, or the performance of such rights and obligations. The Borrower hereby irrevocably consents to the service of a summons and complaint and other process in any action, claim or proceeding brought by the Administrative Agent or any Lender in connection with this Agreement, the Notes or the other Loan Documents, any rights or obligations hereunder or thereunder, or the performance of such rights and obligations, on behalf of itself or its property, in the manner specified 72 in Section 14.1 (other than by posting on an internet web page). Nothing in this Section 14.5 shall affect the right of the Administrative Agent or any Lender to serve legal process in any other manner permitted by Applicable Law or affect the right of the Administrative Agent or any Lender to bring any action or proceeding against the Borrower or its properties in the courts of any other jurisdictions. (b) Venue. The Borrower hereby irrevocably waives any objection it may have now or in the future to the laying of venue in the aforesaid jurisdiction in any action, claim or other proceeding arising out of or in connection with this Agreement, any other Loan Document or the rights and obligations of the parties hereunder or thereunder. The Borrower irrevocably waives, in connection with such action, claim or proceeding, any plea or claim that the action, claim or other proceeding has been brought in an inconvenient forum. SECTION 14.6 Waiver of Jury Trial. THE AGENTS, EACH LENDER AND THE BORROWER HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE, JUDICIAL PROCEEDING, CLAIM OR CONTROVERSY IN CONNECTION WITH THIS AGREEMENT ("DISPUTES"), THE NOTES OR THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. SECTION 14.7 Reversal of Payments. To the extent the Borrower makes a payment or payments to the Administrative Agent for the ratable benefit of the Lenders or the Administrative Agent receives any payment or proceeds of the collateral which payments or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of such payment or proceeds repaid, the Obligations or part thereof intended to be satisfied shall be revived and continued in full force and effect as if such payment or proceeds had not been received by the Administrative Agent. SECTION 14.8 Injunctive Relief; Punitive Damages. (a) The Borrower recognizes that, in the event the Borrower fails to perform, observe or discharge any of its obligations or liabilities under this Agreement, any remedy of law may prove to be inadequate relief to the Lenders. Therefore, the Borrower agrees that the Lenders, at the Lenders' option, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages. (b) The Administrative Agent, the Lenders and the Borrower (on behalf of itself and its Subsidiaries) hereby agree that no such Person shall have a remedy of punitive or exemplary damages against any other party to a Loan Document and each such Person hereby waives any right or claim to punitive or exemplary damages that they may now have or may arise in the future in connection with any Dispute, whether such Dispute is resolved through arbitration or judicially. SECTION 14.9 Accounting Matters. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time, provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied 73 immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance therewith. SECTION 14.10 Successors and Assigns; Participations (a) Benefit of Agreement. This Agreement shall be binding upon and inure to the benefit of the Borrower, the Administrative Agent and the Lenders, all future holders of the Notes, and their respective successors and assigns, except that the Borrower shall not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of each Lender. (b) Assignment by Lenders. Each Lender may, in the ordinary course of its business and in accordance with Applicable Law, sell or assign to any Lender, any Affiliate of a Lender or in the case of the Term Loans any Approved Fund and with the consent of the Borrower (so long as no Default or Event of Default has occurred and is continuing) and the consent of the Administrative Agent, which consents shall not be unreasonably withheld or delayed, assign to one or more other Eligible Assignees (any of the foregoing assignees or purchasers, a "Purchasing Lender") all or a portion of its interests, rights and obligations under this Agreement and the other Loan Documents (including, without limitation, all or a portion of the Extensions of Credit at the time owing to it and the Notes held by it); provided that: (i) each such assignment shall be of a constant, and not a varying, percentage of the Revolving Credit Commitment and/or the Term Loan Commitment, as applicable, of the assigning Lender's rights and obligations under this Agreement; (ii) if less than all of the assigning Lender's Revolving Credit Commitment or Term Loan Commitment, as applicable, is to be assigned, the Commitment so assigned shall not be less than $2,500,000 with respect to the Revolving Credit Facility and $1,000,000 (or otherwise agreed by the Administrative Agent and Borrower) with respect to the Term Loan Facility, unless such sale or assignment is made to an existing Lender, to an Affiliate thereof, or (with respect to any Term Loan) to an Approved Fund, in which case no minimum amount shall apply; (iii) the Purchasing Lender shall have delivered to the Administrative Agent all United States Internal Revenue Service Forms required pursuant to Section 5.11(e) and all of the parties to each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, an Assignment and Acceptance substantially in the form of Exhibit G attached hereto (an "Assignment and Acceptance"), together with (to the extent requested by any Purchasing Lender) any Note or Notes subject to such assignment; (iv) no assignment of a Revolving Credit Commitment, or participation in L/C Obligations or Swingline Loans shall be made without the prior written consent of the Swingline Lender and the Issuing Lender and (so long as no Default or Event of Default has occurred and is continuing) the Borrower (which consent shall not be unreasonably withheld); (v) where consent of the Borrower to an assignment to a Purchasing Lender is required hereunder (including consent to an assignment to an Approved Fund), the Borrower shall be deemed to have given its consent five (5) Business Days after the date written notice thereof has been delivered by the assigning Lender (through the Administrative Agent) unless such consent is expressly refused by the Borrower prior to such fifth (5th) Business Day; (vi) such assignment shall not, without the consent of the Borrower, require the Borrower to file a registration statement with the Securities and Exchange Commission or apply to or qualify the Loans or the Notes under the blue sky laws of any state; and 74 (vii) unless otherwise agreed to by the Administrative Agent, the assigning Lender shall pay to the Administrative Agent an assignment fee of $3,500 upon the execution by such Lender of the Assignment and Acceptance; provided that no such fee shall be payable upon any assignment by a Lender to an Affiliate thereof; and provided further that, in any case of contemporaneous assignments by a Lender (including a group of affiliated Lenders that are funds managed by the same investment advisor) to a single assignee or more than one fund managed by the same investment advisor (which funds are not then Lenders hereunder), only a single $3,500 fee shall be payable for all such contemporaneous assignments. Upon such execution, delivery, acceptance and recording, from and after the effective date specified in each Assignment and Acceptance, which effective date shall be at least five (5) Business Days after the execution thereof (unless otherwise agreed to by the Administrative Agent), (A) the Purchasing Lender thereunder shall be a party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and obligations of a Lender hereby and (B) the Lender thereunder shall, to the extent provided in such assignment, be released from its obligations under this Agreement. (c) Rights and Duties Upon Assignment. By executing and delivering an Assignment and Acceptance, the assigning Lender thereunder and the Purchasing Lender thereunder confirm to and agree with each other and the other parties hereto as set forth in such Assignment and Acceptance. (d) Register. The Administrative Agent shall maintain a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders and the amount of the Extensions of Credit with respect to each Lender from time to time (the "Register"). The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, the Administrative Agent and the Lenders may treat each person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice. (e) Issuance of New Notes. Upon its receipt of an Assignment and Acceptance executed by an assigning Lender and a Purchasing Lender together with any Note or Notes (if applicable) subject to such assignment and (if applicable) the written consent to such assignment, the Administrative Agent shall, if such Assignment and Acceptance has been completed and is substantially in the form of Exhibit G: (i) accept such Assignment and Acceptance; (ii) record the information contained therein in the Register; (iii) give prompt notice thereof to the applicable Lenders and the Borrower; and (iv) promptly deliver a copy of such Assignment and Acceptance to the Borrower. Within five (5) Business Days after receipt of notice, the Borrower shall execute and deliver to the Administrative Agent, in exchange for the surrendered Note or Notes, a new Note or Notes to the order of such Purchasing Lender (to the extent requested thereby) in amounts equal to the Revolving Credit Commitment and/or Term Loan Commitment assumed by it pursuant to such Assignment and Acceptance and a new Note or Notes to the order of the assigning Lender (to the extent requested thereby) in an amount equal to the Revolving Credit Commitment and/or Term Loan Commitment retained by it hereunder. Such new Note or Notes shall be in an aggregate principal amount equal to the aggregate principal amount of such surrendered Note or Notes, shall be dated the effective date of such Assignment and Acceptance and shall otherwise be in substantially the form of the assigned Notes delivered to the 75 assigning Lender. Each surrendered Note or Notes shall be canceled and returned to the Borrower. Notwithstanding anything in this Agreement to the contrary, any Lender which has not been issued a Note or Notes hereunder may at any time deliver a written request for a Note or Notes to the Administrative Agent and the Borrower. Within five (5) Business Days after receipt of notice, the Borrower shall execute and deliver to the Administrative Agent, a Note or Notes (as applicable) to the order of such Lender in amounts equal to the Revolving Credit Commitment and/or Term Loan Commitment of such Lender. Upon receipt thereby, the Administrative Agent shall promptly deliver such Note or Notes to such Lender. (f) Participations. Each Lender may, without notice to or the consent of the Borrower or the Administrative Agent, in the ordinary course of its commercial banking business and in accordance with Applicable Law, sell participations to one or more banks or other entities (any such bank or other entity, a "Participant") in all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Extensions of Credit and the Notes held by it); provided that: (i) each such participation shall be in an amount not less than $2,500,000 with respect to the Revolving Credit Facility and $1,000,000 with respect to the Term Loan Facility; (ii) such Lender's obligations under this Agreement (including, without limitation, its Revolving Credit Commitment and/or Term Loan Commitment, as applicable) shall remain unchanged; (iii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations; (iv) such Lender shall remain the holder of the Notes held by it for all purposes of this Agreement; (v) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement; (vi) such Lender shall not permit such Participant the right to approve any waivers, amendments or other modifications to this Agreement or any other Loan Document other than waivers, amendments or modifications which would reduce the principal of or the interest rate on any Loan or Reimbursement Obligation, extend the term or increase the amount of the Revolving Credit Commitment and/or Term Loan Commitment of such Lender, reduce the amount of any fees to which such Participant is entitled, extend any scheduled payment date for principal of any Loan or, except as expressly contemplated hereby or thereby, release substantially all of the Collateral; and (vii) any such disposition shall not, without the consent of the Borrower, require the Borrower to file a registration statement with the Securities and Exchange Commission to apply to qualify the Loans or the Notes under the blue sky law of any state. The Borrower agrees that each Participant shall be entitled to the benefits of Section 5.7, Section 5.8, Section 5.9, Section 5.10, Section 5.11 and Section 14.3 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section 14.10; provided that a Participant shall not be entitled to receive any greater payment under Section 5.7, Section 5.8, Section 5.9, Section 5.10, and Section 5.11 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower's prior written consent and such Participant 76 shall have delivered to the Administrative Agent all United States Internal Revenue Service Forms required pursuant to Section 5.11(e). (g) Disclosure of Information; Confidentiality. The Administrative Agent and the Lenders shall hold all non-public information with respect to the Borrower obtained pursuant to the Loan Documents (or any Hedging Agreement with a Lender or the Administrative Agent) in accordance with their customary procedures for handling confidential information; provided, that the Administrative Agent may disclose information relating to this Agreement to Gold Sheets and other similar bank trade publications, such information to consist of deal terms and other information customarily found in such publications and provided further, that the Administrative Agent or any Lender may disclose any such information to the extent such disclosure is (i) required by law or requested or required pursuant to any legal process, (ii) requested by, or required to be disclosed to, any rating agency, or regulatory or similar authority (including, without limitation, the National Association of Insurance Commissioners) or (iii) used in any suit, action or proceeding for the purpose of defending itself, reducing its liability or protecting any of its claims, rights, remedies or interests under or in connection with the Loan Documents (or any Hedging Agreement with a Lender or the Administrative Agent). Any Lender may, in connection with any assignment, proposed assignment, participation or proposed participation pursuant to this Section 14.10, disclose to the Purchasing Lender, proposed Purchasing Lender, Participant, proposed Participant, or to any direct or indirect contractual counterparty in swap agreements or such contractual counterparty's professional advisor any information relating to the Borrower furnished to such Lender by or on behalf of the Borrower; provided, that prior to any such disclosure, each such Purchasing Lender, proposed Purchasing Lender, Participant or proposed Participant, contractual counterparty or professional advisor shall agree to be bound by the provisions of this Section 14.10(g). Notwithstanding any other provision in this Agreement, each of the parties hereto (and each employee, representative or other agent of any such party) may disclose to any and all Persons, without limitation of any kind, the U.S. tax treatment and U.S. tax structure of the transaction contemplated hereby and all materials of any kind (including opinions of other tax analyses) that are provided to such party relating to such U.S. tax treatment and U.S. tax structure, other than any information for which nondisclosure is reasonably necessary in order to comply with applicable securities laws. (h) Certain Pledges or Assignments. Any Lender may, without the consent of the Borrower or the Administrative Agent, at any time pledge or assign a security interest in all or any portion of its rights under this Agreement or any other Loan Document to secure obligations of such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment of a security interest shall release a Lender form any of its obligations hereunder or substitute such pledgee or assignee for such Lender as a party hereto. In the case of any Lender that is a fund that invests in bank loans, such Lender may, without the consent of the Borrower or Administrative Agent, assign or pledge all or any portion of its rights under this Agreement, including the Loans and Notes or any other instrument evidencing its rights as a Lender under this Agreement, to any holder or, trustee for, or any other representative of holders of, obligations owed or securities issued, by such fund, as security for such obligations or securities; provided that any foreclosure or similar action by such trustee or representative shall be subject to the provisions of this Section 14.10(b) concerning assignments. SECTION 14.11 Amendments, Waivers and Consents. Except as set forth below or as specifically provided in Section 14.23 or in any Loan Document, any term, covenant, agreement or condition of this Agreement or any of the other Loan Documents may be amended or waived by the Lenders, and any consent given by the Lenders, if, but only if, such amendment, waiver or consent is in writing signed by the Required Lenders (or by the Administrative Agent with the consent of the Required Lenders) and delivered to the Administrative Agent and, in the case of an amendment, signed by the Borrower; provided, that no amendment, waiver or consent shall (a) increase the Revolving Credit 77 Commitment or Term Loan Commitment of any Lender or increase the amount of the Loans of any Lender without the prior written consent of such Lender, (b) reduce the fee or the rate of interest payable on any Loan or Reimbursement Obligation without the prior written consent of each Lender affected thereby, (c) reduce or forgive the principal amount of any Loan or Reimbursement Obligation without the prior written consent of each Lender affected thereby, (d) extend the scheduled time or times of payment of the principal of any Loan or Reimbursement Obligation (including, without limitation, the date of any principal amortization payment set forth in Section 4.3 or the final maturity date) or the time or times of payment of interest on any Loan or Reimbursement Obligation or any fee or commission with respect thereto or the duration of any Interest Period beyond six (6) months without the prior written consent of each Lender affected thereby, (e) permit any subordination of the principal or interest on any Loan or Reimbursement Obligation without the prior written consent of each Lender, (f) release the Borrower from the Obligations (other than Hedging Obligations) hereunder without the prior written consent of each Lender, (g) permit any assignment (other than as specifically permitted or contemplated in this Agreement) of any of the Borrower's rights and obligations hereunder without the prior written consent of each Lender, (h) release any material portion of the Collateral or release any Security Document (other than asset sales permitted pursuant to Section 11.5 and as otherwise specifically permitted or contemplated in this Agreement or the applicable Security Document) without the prior written consent of each Lender, (i) release any Guarantor from its obligations under the Guaranty Agreement without the prior written consent of each Lender, (j) amend the provisions of this Section 14.11 or the definition of Required Lenders without the prior written consent of each Lender or (k) extend the time of the obligation of the Lenders holding Revolving Credit Commitments to make or issue or participate in Letters of Credit, in each case, without the prior written consent of each Lender holding Revolving Credit Loans or a Revolving Credit Commitment. In addition, no amendment, waiver or consent to the provisions of Section 4.4(b)(vi) with respect to the order of application of amounts prepaid, Section 5.4 with respect to the pro rata treatment of payments, or Section 5.5 with respect to the order of application of proceeds shall be made without the written consent of each Lender adversely affected thereby. In addition, no amendment, waiver or consent to the provisions of (a) Article XIII shall be made without the written consent of the Administrative Agent and (b) Article III without the written consent of the Issuing Lender. Notwithstanding anything to the contrary contained in this Agreement, if any Lender does not consent to any amendment, waiver or consent requested by the Borrower, and such amendment, waiver or consent is approved by the Required Lenders, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent given not more than forty-five (45) days after such approval, require such Lender to assign and delegate, without recourse and in accordance with the provisions of Section 14.10(b), all of its interests, rights and obligations under this Agreement and the other Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that such Lender shall have received payment of an amount equal to the outstanding principal amount of its Loans, accrued interest thereon, accrued fees and all other amounts owing to it hereunder from the assignee (to the extent of such outstanding principal and accrued interest and fees) or from the Borrower (in the case of all other amounts). SECTION 14.12 Performance of Duties. The Borrower's obligations under this Agreement and each of the other Loan Documents shall be performed by the Borrower at its sole cost and expense. SECTION 14.13 All Powers Coupled with Interest. All powers of attorney and other authorizations granted to the Lenders, the Administrative Agent and any Persons designated by the 78 Administrative Agent or any Lender pursuant to any provisions of this Agreement or any of the other Loan Documents shall be deemed coupled with an interest and shall be irrevocable so long as any of the Obligations remain unpaid or unsatisfied, any of the Commitments remain in effect or the Credit Facility has not been terminated. SECTION 14.14 Survival of Indemnities. Notwithstanding any termination of this Agreement, the indemnities to which the Administrative Agent and the Lenders are entitled under the provisions of this Article XIV and any other provision of this Agreement and the other Loan Documents shall continue in full force and effect and shall protect the Administrative Agent and the Lenders against events arising after such termination as well as before. SECTION 14.15 Titles and Captions. Titles and captions of Articles, Sections and subsections in, and the table of contents of, this Agreement are for convenience only, and neither limit nor amplify the provisions of this Agreement. SECTION 14.16 Severability of Provisions. Any provision of this Agreement or any other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remainder of such provision or the remaining provisions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction. SECTION 14.17 Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and shall be binding upon all parties, their successors and assigns, and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic means shall be as effective as delivery of a manually executed counterpart of this Agreement. SECTION 14.18 Term of Agreement. This Agreement shall remain in effect from the Closing Date through and including the date upon which all Obligations arising hereunder or under any other Loan Document shall have been indefeasibly and irrevocably paid and satisfied in full and all Commitments have been terminated. The Administrative Agent is hereby permitted to release all Liens on the Collateral in favor of the Administrative Agent, for the ratable benefit of itself and the Lenders, upon repayment of the outstanding principal of and all accrued interest on the Loans, payment of all outstanding fees and expenses hereunder and the termination of the Lender's Commitments. No termination of this Agreement shall affect the rights and obligations of the parties hereto arising prior to such termination or in respect of any provision of this Agreement which survives such termination. SECTION 14.19 Advice of Counsel. Each of the parties represents to each other party hereto that it has discussed this Agreement with its counsel. SECTION 14.20 No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement. SECTION 14.21 Inconsistencies with Other Documents; Independent Effect of Covenants. (a) In the event there is a conflict or inconsistency between this Agreement and any other Loan Document, the terms of this Agreement shall control; provided, that any provision of the Security 79 Documents which imposes additional burdens on the Borrower or its Subsidiaries or further restricts the rights of the Borrower or its Subsidiaries or gives the Administrative Agent or Lenders additional rights shall not be deemed to be in conflict or inconsistent with this Agreement and shall be given full force and effect. (b) The Borrower expressly acknowledges and agrees that each covenant contained in Articles IX, X, or XI hereof shall be given independent effect. Accordingly, the Borrower shall not engage in any transaction or other act otherwise permitted under any covenant contained in Articles IX, X, or XI if, before or after giving effect to such transaction or act, the Borrower shall or would be in breach of any other covenant contained in Articles IX, X, or XI. SECTION 14.22 Continuity of Contract. The parties hereto agree that the occurrence or non-occurrence of EMU, any event or events associated with EMU and/or the introduction of the euro in all or any part of the European Union (a) will not result in the discharge, cancellation, rescission or termination in whole or in part of this Agreement or any other Loan Document, (b) will not give any party the right to cancel, rescind, terminate or vary this Agreement or any other Loan Document or (c) will not give rise to an Event of Default, in each case other than as specifically provided in this Agreement. SECTION 14.23 Increase of Revolving Credit Commitments. Notwithstanding anything to the contrary contained in this Agreement, the Administrative Agent, the Borrower and one or more financial institutions (including any existing Lender) may from time to time enter into an amendment to this Agreement solely for the purpose of adding such financial institution as a Lender with a Revolving Credit Commitment under this Agreement (or, if such financial institution is already a Lender, increasing its Revolving Credit Commitment); provided that (i) after giving effect to such amendment, the aggregate Revolving Credit Commitments of all of the Lenders (including any new Lender) will not exceed $100,000,000, (ii) on the effective date of such amendment the outstanding Revolving Credit Loans will be deemed to be reallocated among the Lenders (including any new Lender) so that such Revolving Credit Loans are pro rata to the Revolving Credit Commitments of all of the Lenders after giving effect to such amendment, and the new Lender (or the existing Lender whose Commitment is being increased) will pay to the Administrative Agent for the account of the other Lenders such amount as is necessary to accomplish such result and (iii) the Borrower shall simultaneously pay to each existing Lender any funding losses to be incurred by such lender in connection with the payment to be received by such Lender pursuant to clause (ii) above. Any such amendment shall be in form and substance satisfactory to the Administrative Agent who shall promptly provide a copy thereof to each Lender. SECTION 14.24 Transition Provisions. Notwithstanding anything to the contrary in the Existing Facility or this Agreement, this Agreement shall constitute an amendment and restatement, and not a novation, of the Existing Facility and: (a) all letters of credit issued by the Issuing Lender pursuant to the Existing Facility and outstanding on the Closing Date shall be deemed to have been issued pursuant to this Agreement and shall be considered Letters of Credit for purposes hereof; (b) all swingline loans made pursuant to the Existing Facility and outstanding on the Closing Date shall be paid in full by the Borrower on the Closing Date; (c) (i) all revolving credit loans and term loans made under the Existing Facility and outstanding on the Closing Date (after giving effect to the $25,000,000 repayment of term loans made on the Closing Date) shall be deemed to have been made pursuant to this Agreement and shall be considered Revolving Credit Loans and Term Loans, respectively, for all purposes hereof, (ii) effective as of the Closing Date, such Revolving Credit Loans and Term Loans shall be reallocated among the Lenders to 80 the extent necessary so that, after giving effect thereto, the outstanding Revolving Credit Loans and Term Loans shall be allocated among the Lenders pro rata according to their respective Revolving Credit Commitments and Term Loan Commitments, as the case may be, (iii) on the Closing Date, the Lenders shall, as directed by the Administrative Agent, make such payments among themselves as is necessary to accomplish such reallocation and (iv) on the Closing Date, the Borrower will pay all costs and expenses (including, without limitation, breakage costs or increased funding costs) necessary to compensate each Lender for such reallocation; (d) all accrued fees payable under the Existing Facility and unpaid on the Closing Date shall be deemed to be accrued and unpaid under this Agreement and shall become due and payable under this Agreement as and when provided herein, except that any accrued fees payable to any lender under the Existing Facility who is not continuing as a Lender under this Agreement shall be paid in full by the Borrower on the Closing Date. [Signature pages to follow] 81 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed under seal by their duly authorized officers, all as of the day and year first written above. WACKENHUT CORRECTIONS CORPORATION, as Borrower By: /s/ John G. O'Rourke ------------------------------------------------- Name: John G. O'Rourke Title: Chief Financial Officer- Senior Vice President BNP PARIBAS, as Administrative Agent, Syndication Agent and Lender By: /s/ Duane P. Helkowski ------------------------------------------------- Name: Duane P. Helkowski Title: Managing Director By: /s/ Richard Pace ------------------------------------------------- Name: Richard Pace Title: Director [ADDITIONAL LENDERS], as Lender By:__________________________________________________ Name: Title: EX-99.1 7 g84060exv99w1.txt EX-99.1 PRESS RELEASE DATED JULY 9, 2003 EXHIBIT 99.1 Press Release Source: Wackenhut Corrections Corporation WACKENHUT CORRECTIONS CORPORATION ANNOUNCES COMPLETION OF NEW FINANCING Wednesday July 9, 3:33 pm ET BOCA RATON, Fla., July 9 /PRNewswire-FirstCall/ -- Wackenhut Corrections Corporation (NYSE: WHC - News; "WCC") announced today that it has completed the sale of $150 million in aggregate principal amount of ten-year, 81/4% senior unsecured notes in a private offering to qualified institutional buyers under Rule 144A of the Securities Act and to persons outside the United States pursuant to Regulation S and the amendment of its senior secured credit facility, consisting of a $100 million 6-year term loan ("Term Loan B") and a $50 million 5-year revolver ("Revolver"). The interest rate for the Term Loan B and the Revolver is LIBOR plus 3%. o (Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20010614/WCCLOGO) The notes have not been registered under the securities laws of the United States and may not be offered or sold in the United States except to qualified institutional buyers. WCC has used the net proceeds from the offering, together with approximately $100 million of borrowings under its amended senior secured credit facility and approximately $16 million in cash-on-hand, to repurchase 12 million shares of its common stock from Group 4 Falck A/S, its former 57% shareholder, and to refinance amounts outstanding under its previous senior secured credit facility. This press release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities law of any such jurisdiction. - -------------------------- Source: Wackenhut Corrections Corporation EX-99.2 8 g84060exv99w2.txt EX-99.2 PRESS RELEASE DATED JULY 9, 2003 EXHIBIT 99.2 Press Release Source: Wackenhut Corrections Corporation WACKENHUT CORRECTIONS CORPORATION ANNOUNCES REPURCHASE OF GROUP 4 FALCK'S CONTROLLING INTEREST Wednesday July 9, 4:09 pm ET BOCA RATON, Fla., July 9 /PRNewswire-FirstCall/ -- Wackenhut Corrections Corporation (NYSE: WHC - News; "WCC") announced today that it has completed the repurchase of all 12 million shares of WCC common stock held by its former majority shareholder, Group 4 Falck of Denmark. The two Group 4 Falck members of the WCC Board of Directors have tendered their resignations, reducing the WCC Board from nine to seven members. o (Photo: http://www.newscom.com/cgi-bin/prnh/20010614/WCCLOGO ) George C. Zoley, Chairman of the Board and Chief Executive Officer of WCC, stated: "This historic transaction transforms WCC from a corporate subsidiary into a truly independent company with full access to the capital markets and the ability to grow at its own pace. We have recently moved our corporate offices to Boca Raton, Florida and will be establishing a new name for the company within the next year pursuant to the Group 4 Falck share repurchase agreement. We are confident that the elimination of the uncertainty created by Group 4 Falck's 12 million share overhang will represent a long term benefit for WCC shareholders." WCC had previously given investor guidance for 2003 earnings per share within the range of $1.04 to $1.06, which did not assume either the repurchase of 12 million shares from Group 4 Falck or the sale of WCC's 50% interest in the UK joint venture, Premier Custodial Group Limited ("PCG"). With the repurchase of the 12 million shares, which reduces the number of outstanding shares to 9.4 million (or 15.3 million weighted average shares for 2003), and with the sale of WCC's 50% interest in PCG, WCC estimates 2003 earnings per share to be within the range of $3.00 to $3.20, inclusive of an after-tax book gain of approximately $32 million from the sale of PCG. Investor guidance previously given by WCC for 2004 did not reflect the sale of WCC's interest in PCG. Since WCC has not yet allocated the proceeds from that sale for any specific purpose, WCC is not providing any updated investor guidance for 2004 at this time. Mr. Zoley further stated: "With the approximately $80 million in pre-tax proceeds, or $52 million in after-tax proceeds, that the company received from the sale of its 50% interest in the UK joint venture and the company's enhanced ability to access the capital markets, WCC plans to pursue one or more acquisitions during the next nine months, rather than pay down borrowings under its senior credit facility. The company will be considering opportunities in the US and international markets within its existing business lines of correctional and mental health care services." WCC also announced today that its Board of Directors has adopted a shareholder rights plan. The rights plan is intended to assist the company in pursuing its long-term business strategies and to enhance stockholder value. WCC is a world leader in the delivery of correctional and detention management, health and mental health services to federal, state and local government agencies around the globe. WCC offers a turnkey approach that includes design, construction, financing and operations. The Company represents 31 government clients servicing 48 facilities in the United States, Australia, South Africa, New Zealand, and Canada with a total design capacity of approximately 36,000 beds. This press release contains forward-looking statements regarding future events and future performance of the Company that involve risks and uncertainties that could materially affect actual results, including statements regarding estimated earnings, revenues and costs and our ability to maintain growth and strengthen contract relationships. Factors that could cause actual results to vary from current expectations and forward-looking statements contained in this press release include, but are not limited to: (1) WCC's ability to use the net proceeds from the sale of its UK joint venture interest to acquire a prison or mental health services business or to otherwise expand its existing operations in those lines of business; (2) fluctuations in the exchange rate between the UK pound and the US dollar; (3) WCC's ability to meet its earnings guidance for 2003 given the various risks to which its business is exposed; (4) WCC's ability to access the capital markets in the future on satisfactory terms or at all; (5) risks associated with WCC's ability to control operating costs associated with contract start- ups; (6) WCC's ability to timely open facilities as planned, profitably manage such facilities and successfully integrate such facilities into WCC's operations without substantial costs; (7) WCC's ability to win management contracts for which it has submitted proposals and to retain existing management contracts; (8) WCC's ability to obtain future financing on acceptable terms; (9) WCC's ability to sustain company-wide occupancy rates at its facilities; and (10) other factors contained in WCC's Securities and Exchange Commission filings, including the forms 10-K, 10-Q and 8-K reports. - --------------------- Source: Wackenhut Corrections Corporation -----END PRIVACY-ENHANCED MESSAGE-----

EX-1.1

                                                                     EXHIBIT 1.1


                                  $150,000,000

                        WACKENHUT CORRECTIONS CORPORATION

                          8 1/4% SENIOR NOTES DUE 2013

                               PURCHASE AGREEMENT

July 1, 2003
BNP PARIBAS SECURITIES CORP.
LEHMAN BROTHERS INC.
FIRST ANALYSIS SECURITIES CORPORATION
SOUTHTRUST SECURITIES, INC.
COMERICA SECURITIES, INC.
c/o BNP Paribas Securities Corp.
The Equitable Tower
787 Seventh Avenue
New York, NY 10019

Ladies and Gentlemen:

         Wackenhut Corrections Corporation, a Florida corporation (the
"COMPANY"), proposes, upon the terms and conditions set forth herein, to issue
and sell to you (the "OFFERING"), as the initial purchasers (the "INITIAL
PURCHASERS"), $150,000,000 in aggregate principal amount of its 8 1/4% Senior
Notes due 2013 (the "NOTES"). The Notes will (i) have terms and provisions that
are summarized in the Offering Memorandum (as defined below) and (ii) are to be
issued pursuant to an Indenture (the "INDENTURE"), to be dated as of July 9,
2003, to be entered into between the Company and The Bank of New York, as
trustee (the "TRUSTEE"). This is to confirm the agreement concerning the
purchase of the Notes from the Company by the Initial Purchasers.

         As described in the Offering Memorandum, the net proceeds from the
Offering, together with cash on hand and $100.0 million of the borrowings under
an amendment (the "AMENDED SENIOR CREDIT FACILITY") to the Company's senior
secured credit facility (the "EXISTING SENIOR CREDIT FACILITY") will be used by
the Company to (i) repurchase (the "SHARE REPURCHASE") up to 12.0 million shares
of its common stock, par value $0.01 per share (the "COMMON STOCK"), from Group
4 Falck, its majority shareholder (ii) refinance (the "REFINANCING") $125.0
million of borrowings outstanding under the Existing Senior Credit Facility (the
Offering, the Amended Senior Credit Facility, the Share Repurchase and the
Refinancing are collectively referred to in this Agreement as the
"TRANSACTIONS") and (iii) pay fees and expenses related to the Transactions.

         1. PRELIMINARY OFFERING MEMORANDUM AND OFFERING MEMORANDUM. The Notes
will be offered and sold to the Initial Purchasers without registration under
the Securities Act of 1933, as amended (the "ACT"), in reliance on an exemption
pursuant to Section 4(2) under the Act. The Company has prepared a preliminary
offering memorandum, dated June 18, 2003 (the "PRELIMINARY OFFERING
MEMORANDUM"), and an offering memorandum, dated July 1, 2003 (the "OFFERING





MEMORANDUM"), setting forth information regarding the Company, the Notes, the
Exchange Notes (as defined herein) and the Transactions. The Company hereby
confirms that it has authorized the use of the Preliminary Offering Memorandum
and the Offering Memorandum in connection with the offering and resale of the
Notes by the Initial Purchasers.

         It is understood and acknowledged that upon original issuance thereof,
and until such time as the same is no longer required under the applicable
requirements of the Act, the Notes (and all securities issued in exchange
therefore (other than the Exchange Notes), in substitution thereof) shall bear a
legend substantially in the form of the following (along with such other legends
as the Initial Purchasers and their counsel deem necessary):

         THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
         SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR OTHER
         SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION
         HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
         ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
         UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
         REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS
         NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A
         "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
         SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING ITS
         NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF REGULATION S
         UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE
         DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY
         RULE 144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION
         THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF
         ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE COMPANY OR
         ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY
         PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
         REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"),
         OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY,
         (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
         EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE
         ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY
         BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A



                                       2


         UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
         ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT
         THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A INSIDE THE UNITED
         STATES, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
         OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
         SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM
         THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT
         IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
         SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY,
         THE TRUSTEE AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH
         OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE
         THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
         INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE
         FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OF TRANSFER IN THE
         FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND
         DELIVERED BY THIS TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE
         REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
         TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
         "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY
         REGULATION S UNDER THE SECURITIES ACT.

         You have advised the Company that you will make offers (the "EXEMPT
RESALES") of the Notes purchased by you hereunder on the terms set forth in the
Offering Memorandum, as amended or supplemented, solely to (i) persons whom you
reasonably believe to be "qualified institutional buyers" as defined in Rule
144A under the Act ("QIBS") and (ii) outside the United States to certain
persons in offshore transactions in reliance on Regulation S under the Act.
Those persons specified in clauses (i) and (ii) are referred to herein as the
("ELIGIBLE PURCHASERS"). You will offer the Notes to Eligible Purchasers
initially at a price equal to 100% of the principal amount thereof. Such price
may be changed at any time without notice.

         Holders (including subsequent transferees) of the Notes will have the
registration rights set forth in the registration rights agreement attached
hereto as Exhibit A (the "REGISTRATION RIGHTS AGREEMENT") among the Company and
the Initial Purchasers to be dated July 9, 2003, or such other date as agreed to
by the Company and the Initial Purchasers. Pursuant to the Registration Rights
Agreement, the Company will agree to file with the Securities and Exchange
Commission (the "COMMISSION") under the circumstances set forth therein, (i) a
registration statement under the Act (the "EXCHANGE OFFER REGISTRATION
STATEMENT") relating to the Company's 8 1/4% Senior Notes due 2013 (the
"EXCHANGE NOTES") to be offered in exchange for the Notes (such offer to
exchange being referred to collectively as the "EXCHANGE OFFER" and (ii) if
required by the terms of the Registration Rights Agreement, a shelf registration
statement pursuant to Rule 415 under the Securities Act (the "SHELF REGISTRATION
STATEMENT" and, together with the Exchange Offer Registration Statement, the
"REGISTRATION Statements") relating to the resale by certain holders of the
Notes, and to use their best efforts to cause such Registration Statements to be
declared effective. This is to confirm the agreements concerning the purchase of
the Notes from the Company by the Initial Purchasers.

         2. REPRESENTATIONS, WARRANTIES OF THE COMPANY. The Company represents,
warrants and covenants to each Initial Purchaser as follows:

                  (a) When the Notes are issued and delivered pursuant to this
Agreement, such Notes will not be of the same class (within the meaning of Rule
144A under the Act) as securities of the Company that are listed on a national



                                       3


securities exchange registered under Section 6 of the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), or that are quoted in a United States
automated inter-dealer quotation system.

                  (b) Neither the Company nor any of its Subsidiaries (as
defined below) is, or after giving effect to the offering and sale of the Notes
and upon application of the proceeds as described under the caption "Use of
Proceeds" in the Offering Memorandum will be, an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.

                  (c) Assuming that your representations and warranties in
Section 3(b) are true, the purchase of the Notes by you pursuant to this
Agreement and the resale of the Notes pursuant to the Exempt Resales is exempt
from the registration requirements of the Act. No form of general solicitation
or general advertising within the meaning of Regulation D (including, but not
limited to, advertisements, articles, notices or other communications published
in any newspaper, magazine or similar medium or broadcast over television or
radio, or any seminar or meeting whose attendees have been invited by any
general solicitation or general advertising) was used by the Company or any of
its representatives (other than you, as to whom the Company makes no
representation) in connection with the offer and sale of the Notes.

                  (d) No form of general solicitation or general advertising was
used by the Company or any of its representatives (other than you, as to whom
the Company makes no representation) with respect to Notes sold outside the
United States to non-U.S. persons (as defined in Rule 902 under the Act), by
means of any directed selling efforts within the meaning of Rule 902 under the
Act, and the Company, any affiliate of the Company and any person acting on its
or their behalf (other than you, as to whom the Company makes no representation)
has complied with and will implement the "offering restrictions" required by
Rule 902.

                  (e) Set forth on Exhibit B hereto is a list of each "employee
pension benefit plan," as defined in Section 3(2) of the Employee Retirement
Income Security Act of 1974 including the regulations and published
interpretations thereunder ("ERISA") or "employee benefit plan," as defined in
Section 3(3) of ERISA with respect to which the Company or any corporation
considered an affiliate of the Company within the meaning of Section 407(d)(7)
of ERISA is a "party in interest," as defined in Section 3(14) of ERISA" or
"disqualified person," as defined in Section 4975(e)(2) of the Internal Revenue
Code of 1986, as amended.

                  (f) The Preliminary Offering Memorandum and Offering
Memorandum have been prepared by the Company for use by the Initial Purchasers
in connection with the Exempt Resales. No order or decree preventing the use of
the Preliminary Offering Memorandum or the Offering Memorandum, or any order
asserting that the transactions contemplated by this Agreement are subject to
the registration requirements of the Act has been issued and no proceeding for
that purpose has commenced or is pending or, to the knowledge of the Company, is
contemplated.

                  (g) The Preliminary Offering Memorandum and the Offering
Memorandum, and any amendment or supplement thereto, as of their respective
dates and the Offering Memorandum as of the Closing Date (as defined below), did
not or will not contain any untrue statement of a material fact or omit to state



                                       4


a material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading, except that this representation and warranty does not
apply to statements in or omissions from the Preliminary Offering Memorandum and
Offering Memorandum made in reliance upon and in conformity with information
relating to the Initial Purchasers furnished to the Company in writing by or on
behalf of the Initial Purchasers expressly for use therein.

                  (h) Each subsidiary of the Company that is material to the
business, financial condition or results of operations of the Company, taken as
a whole (each a "SUBSIDIARY" and collectively, the "SUBSIDIARIES"), is set forth
on Exhibit F hereto. The only subsidiaries of the Company are (a) the
Subsidiaries set forth on Exhibit F hereto and (b) certain other subsidiaries
which, considered in the aggregate as a single subsidiary, are not material to
the business, financial condition or results of operations of the Company, taken
as a whole.

                  (i) The market-related, industry-related and customer-related
data and estimates included in the Preliminary Offering Memorandum and the
Offering Memorandum are based on or derived from sources that the Company
believes to be reliable and accurate.

                  (j) The Company and each of its Subsidiaries have been duly
incorporated, organized or formed, as the case may be, and are validly existing
as corporations, limited liability companies, partnerships or limited liability
partnerships or other corporate entities, as the case may be, in good standing
under the laws of their respective jurisdictions of incorporation, organization
or formation, as the case may be, are duly qualified to do business and are in
good standing in each jurisdiction in which their respective ownership or lease
of property or the conduct of their respective businesses requires such
qualification (except such failures to qualify as are not, either individually
or in the aggregate, material to the Company and its Subsidiaries taken as a
whole), and have all corporate, limited liability company, partnership or
limited liability partnership as the case may be, power and authority necessary
to own or hold their respective properties and to conduct the businesses in
which they are engaged; and none of the Subsidiaries of the Company (other than
Wackenhut Corrections Corporation Australia Pty. Ltd., Wackenhut Correctional
Services Pty. Ltd. and Australasian Correctional Management, PTY Ltd. (each a
"SIGNIFICANT SUBSIDIARY")) is a "significant subsidiary," as such term is
defined in Rule 405 of the Rules and Regulations (as defined herein).

                  (k) The Company has an authorized capitalization as set forth
in the Offering Memorandum, and all of the issued shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; and all of the issued shares of capital stock of each Subsidiary
of the Company have been duly and validly authorized and issued and are fully
paid and non-assessable and (except for directors' qualifying shares) are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims, except with respect to the shares of capital
stock of certain Subsidiaries of the Company subject to liens or encumbrances
under the Amended Senior Credit Facility as disclosed in the Offering
Memorandum. There are no authorized or outstanding options, warrants, preemptive
rights, rights of first refusal or other rights to purchase, or equity or debt



                                       5


securities convertible into or exchangeable or exercisable for, any capital
stock of the Company or any of its Subsidiaries other than those accurately
described in the Offering Memorandum as being authorized or outstanding as of
the date stated therein.

                  (l) The Company and its Subsidiaries, as applicable, have all
requisite corporate, limited liability company, partnership or limited liability
partnership, as the case may be, power and authority to consummate the
Transactions and to enter into all agreements related to the Transactions
(collectively, the "TRANSACTION DOCUMENTS") to which they are a party. Each of
the Transaction Documents has been duly and validly authorized by the Company
and its Subsidiaries, as applicable, and when executed and delivered by the
Company and its Subsidiaries, as applicable, will (assuming due authorization,
execution and delivery by the other parties thereto) constitute a legal, valid
and binding agreement of each of the Company and such Subsidiaries, enforceable
against the Company and each of such Subsidiaries, as applicable, in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium and other laws
relating to or affecting creditors' rights generally, from time to time in
effect, and by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

                  (m) The Company has all requisite corporate power and
authority to enter into the Indenture. The Indenture has been duly and validly
authorized by the Company, and upon its execution and delivery and, assuming due
authorization, execution and delivery by the Trustee, will constitute the valid
and binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws relating to or affecting creditors' rights generally, from time to
time in effect, and by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law); no
qualification of the Indenture under the Trust Indenture Act of 1939 (the "1939
ACT") is required in connection with the offer and sale of the Notes
contemplated hereby or in connection with the Exempt Resales.

                  (n) The Indenture will conform to the description thereof in
the Offering Memorandum.

                  (o) The Notes are in the form contemplated by the Indenture.
The Company has all requisite corporate power and authority to issue and sell
the Notes. The Notes have been duly and validly authorized by the Company and,
when duly executed by the Company in accordance with the terms of the Indenture,
assuming due authentication of the Notes by the Trustee, upon delivery to the
Initial Purchasers against payment therefor in accordance with the terms hereof,
will be validly issued and delivered, and will constitute valid and binding
obligations of the Company entitled to the benefits of the Indenture,
enforceable against the Company in accordance with their terms, except as such
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights generally, from time to time in effect, and by general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law).




                                       6


                  (p) The Notes will conform to the description thereof in the
Offering Memorandum.

                  (q) The Company has all requisite corporate power and
authority to issue the Exchange Notes. The Exchange Notes have been duly and
validly authorized by the Company and if and when duly issued and authenticated
in accordance with the terms of the Indenture and delivered in accordance with
the Exchange Offer provided for in the Registration Rights Agreement, will
constitute valid and binding obligations of the Company entitled to the benefits
of the Indenture, enforceable against the Company in accordance with their
terms, except as such enforceability may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally, from time to time in effect, and by
general equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

                  (r) The Company has all requisite corporate power and
authority to enter into the Registration Rights Agreement. The Registration
Rights Agreement has been duly and validly authorized by the Company and, when
executed and delivered by the Company in accordance with the terms hereof and
thereof, will be validly executed and delivered and (assuming the due
authorization, execution and delivery thereof by you) will be the legally valid
and binding obligation of the Company in accordance with the terms thereof,
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditor's rights
generally, from time to time in effect, by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and, as to rights of indemnification and contribution, by
principles of public policy.

                  (s) The Registration Rights Agreement will conform to the
description thereof in the Offering Memorandum.

                  (t) The Company has all requisite corporate power and
authority to enter into this Agreement. This Agreement has been duly authorized,
executed and delivered by the Company.

                  (u) The issue and sale of the Notes and the compliance by the
Company with all of the provisions of the Notes, the Exchange Notes, the
Indenture, the Registration Rights Agreement and this Agreement and the
consummation of the Transactions (i) will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which the Company or any of its Subsidiaries is
a party or by which the Company or any of its Subsidiaries is bound or to which
any of the property or assets of the Company or any of its Subsidiaries is
subject, except for such conflicts, breaches, violations or defaults that,
individually or in the aggregate, would not result in any material adverse



                                       7


change in the management, condition, financial or otherwise, stockholders'
equity, results of operations, business or prospects of the Company and its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"), (ii) will not
result in any violation of the provisions of the charter or by-laws of the
Company or any of its Subsidiaries or (iii) will not violate any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its Subsidiaries or any of their
properties or assets, except such violations that, individually or in the
aggregate, would not have a Material Adverse Effect; and no consent, approval,
authorization or order of, or filing, registration or qualification with any
such court or governmental agency or body is required for the issue and sale of
the Notes or the consummation by the Company of the transactions contemplated by
this Agreement (including each of the Transactions), the Registration Rights
Agreement or the Indenture, except for the filing of a registration statement by
the Company with the Commission pursuant to the Act as required by the
Registration Rights Agreement, such consents, approvals, authorizations, orders,
filings, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and distribution of
the Notes by the Initial Purchasers and any filings, qualifications or other
consents or approvals under the 1939 Act in connection with the Exchange Notes.

                  (v) There are no contracts, agreements or understandings
between the Company and any person granting such person the right (other than
rights that have been waived or satisfied) to require the Company to file a
registration statement under the Act with respect to any securities of the
Company (other than the Registration Rights Agreement) owned or to be owned by
such person or to require the Company to include such securities in the
securities registered pursuant to the Registration Rights Agreement or in any
securities being registered pursuant to any other registration statement filed
by the Company under the Act.

                  (w) The Company has not, directly or indirectly, solicited any
offer to buy or offered to sell, and will not, directly or indirectly, solicit
any offer to buy or offer to sell, in the United States or to any United States
citizen or resident, any security which is or would be integrated with the sale
of the Notes in a manner that would require the Notes to be registered under the
Act. None of the Company, its Affiliates (as such term is defined in Rule 501
under the Securities Act (each, an "Affiliate")) or any person acting on its or
any of their behalf (other than the Initial Purchasers, as to whom the Company
makes no representation or warranty) has engaged or will engage, in connection
with the Offering, in any form of general solicitation or general advertising
within the meaning of Rule 502 under the Act.

                  (x) Except as otherwise disclosed in the Offering Memorandum,
neither the Company nor any of its Subsidiaries has sustained, since the date of
the latest audited financial statements included in the Offering Memorandum, any
material loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Offering Memorandum; and, since such date, except as
otherwise disclosed in the Offering Memorandum, there has not been any material
change in the stockholders' equity or long-term debt of the Company or any of
its Subsidiaries or any Material Adverse Effect.

                  (y) The financial statements (including the related notes and
supporting schedules) included in the Offering Memorandum present fairly, in all
material respects, the financial condition and results of operations of the
entities purported to be shown thereby, at the dates and for the periods
indicated, and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved, except as may be expressly stated in the related notes thereto and



                                       8


comply as to form, in all material respects, with the applicable requirements of
the Act. The financial data set forth in the Offering Memorandum under the
captions "Offering Memorandum Summary - Summary Historical and Pro Forma
Financial and Other Data" and "Selected Consolidated Financial and Other Data"
fairly present, in all material respects, the information set forth therein on a
basis consistent with that of the financial statements contained in the Offering
Memorandum.

                  (z) The presentation of the other financial data, operating
data and statistical information and data included in the Offering Memorandum is
a fair presentation of such information and data in all material respects and,
to the extent derived therefrom, has been prepared on a basis consistent with
the financial statements and the books and records of the Company and its
Subsidiaries.

                  (aa) The pro forma financial statements and the related notes
thereto included in the Offering Memorandum present fairly, in all material
respects, the information shown therein, have been prepared in accordance with
the Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the bases described therein, and
the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions and
circumstances referred to therein.

                  (bb) Ernst & Young LLP, who have certified certain financial
statements of the Company and certain of its Affiliates, whose report appears in
the Offering Memorandum and who have delivered the initial letter referred to in
Section 7(e) hereof, are independent public accountants as required by the Act
and the rules and regulations promulgated thereunder (the "RULES AND
REGULATIONS"); and Arthur Andersen LLP, who have certified certain financial
statements of the Company and whose reports appear in the Offering Memorandum,
were independent public accountants as required by the Act and the Rules and
Regulations during the periods covered by the financial statements on which they
reported contained in the Offering Memorandum.

                  (cc) The Company and each of its Subsidiaries has good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned by them, in each case free and clear of all
liens, encumbrances and defects except such as are disclosed in the Offering
Memorandum, the liens and encumbrances contemplated under the Amended Senior
Credit Facility as disclosed in the Offering Memorandum, and such liens,
encumbrances and defects as do not materially affect the value of the property
of the Company and its Subsidiaries taken as a whole and do not materially
interfere with the use made and proposed to be made of such property by the
Company or any of its Subsidiaries; and all real property and buildings held
under lease by the Company or any of its Subsidiaries are held by them under
valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company or any of its Subsidiaries.

                  (dd) Except as described in the Offering Memorandum, the
Company and each of its subsidiaries carry, or are covered by, insurance in such
amounts and covering such risks as is adequate for the conduct of their
respective businesses and the value of their respective properties and as is
customary for companies engaged in similar businesses in similar industries. The
Company has no reason to believe that it or any Subsidiary will not be able (i)



                                       9


to renew its existing insurance coverage as and when such policies expire,
except where the failure to renew would not have a Material Adverse Effect or
(ii) to obtain comparable coverage from similar institutions as may be necessary
or appropriate to conduct its business as now conducted and at a cost that would
not result in a Material Adverse Effect.

                  (ee) Except as described in the Offering Memorandum, there are
no legal or governmental proceedings pending to which the Company or any of its
Subsidiaries is a party or of which any property or assets of the Company or any
of its Subsidiaries is the subject that, if determined adversely to the Company
or any of its Subsidiaries, would reasonably be expected to have a Material
Adverse Effect, and to the best of the Company's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or threatened by
others.

                  (ff) Except as otherwise disclosed in the Offering Memorandum,
the Company and its Subsidiaries own or possess, license or have other rights to
use sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals, trade secrets and other similar rights (collectively, "INTELLECTUAL
PROPERTY RIGHTS") reasonably necessary to conduct their businesses as now
conducted or as proposed in the Offering Memorandum to be conducted, except
where the failure to own, possess, license or have other rights to use such
Intellectual Property Rights would not reasonably be expected to have a Material
Adverse Effect; and the expected expiration of any of such Intellectual Property
Rights would not result in a Material Adverse Effect. Except as otherwise
disclosed in the Offering Memorandum, neither the Company nor any of its
Subsidiaries has received any notice of infringement or conflict with asserted
Intellectual Property Rights of others, which infringement or conflict, if the
subject of an unfavorable decision, would result in a Material Adverse Effect.

                  (gg) The Company and each of its Subsidiaries possess such
valid and current certificates, authorizations or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies necessary to
conduct their respective businesses, and neither the Company nor any Subsidiary
has received any notice of proceedings relating to the revocation or
modification of, or non-compliance with, any such certificate, authorization or
permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would result in a Material Adverse Effect.

                  (hh) No relationship, direct or indirect, that would be
required to be described in a Company registration statement pursuant to Item
404 of Regulation S-K, exists between or among the Company on the one hand, and
the directors, officers, stockholders, customers or suppliers of the Company on
the other hand, that has not been described in the Offering Memorandum.

                  (ii) No labor disturbance by the employees of the Company or
any of its Subsidiaries exists or, to the knowledge of the Company or any of its
Subsidiaries, is imminent that would reasonably be expected to have a Material
Adverse Effect.

                  (jj) The Company is in compliance in all material respects
with all presently applicable provisions of ERISA; no "reportable event" (as
defined in ERISA) has occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company would have any liability; the Company has not
incurred and does not expect to incur liability under (i) Title IV of ERISA with



                                       10


respect to termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended, including
the regulations and published interpretations thereunder (the "CODE"); and each
"pension plan" for which the Company would have any liability that is intended
to be qualified under Section 401(a) of the Code is so qualified in all material
respects and nothing has occurred, whether by action or by failure to act, which
would cause the loss of such qualification.

                  (kk) The Company has filed all federal, state and local income
and franchise tax returns required to be filed through the date hereof and has
paid all taxes due thereon, except where such failure to file or pay would not
have a Material Adverse Effect, and no tax deficiency has been determined
adversely to the Company or any of its Subsidiaries that has had (nor does the
Company have any knowledge of any tax deficiency that, if determined adversely
to the Company or any of its Subsidiaries, might have) a Material Adverse
Effect.

                  (ll) Since the date as of which information is given in the
Preliminary Offering Memorandum through the date hereof, and except as may
otherwise be disclosed in the Offering Memorandum, subsequent to the respective
dates as of which information is given in the Offering Memorandum, neither the
Company nor any of its Subsidiaries has (i) issued or granted any securities,
other than securities issued upon the exercise of stock options, (ii) incurred
any liability or obligation, direct or contingent, other than liabilities and
obligations that were incurred in the ordinary course of business and which have
not or would not reasonably be expected to result in a Material Adverse Effect,
(iii) entered into any transaction not in the ordinary course of business or
(iv) declared or paid any dividend on its capital stock (other than to the
Company or its Subsidiaries).

                  (mm) The Company (i) makes and keeps accurate books and
records and (ii) maintains internal accounting controls that provide reasonable
assurance that (A) transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit preparation
of its financial statements and to maintain accountability for its assets, (C)
access to its assets is permitted only in accordance with management's
authorization and (D) the reported accountability for its assets is compared
with existing assets at reasonable intervals.

                  (nn) Neither the Company nor any of its Subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default, and no event has
occurred that, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant, condition
or other obligation contained in any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which it is a party or by which it
is bound or to which any of its properties or assets is subject, except for any
defaults which would not, individually or in the aggregate, have a Material
Adverse Effect or (iii) is in violation of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets may be
subject or has failed to obtain or maintain any material license, permit,
certificate, franchise or other governmental authorization or permit necessary
to the ownership of its property or to the conduct of its business, except for
any violation or failures to obtain or maintain which would not, individually or
in the aggregate, have a Material Adverse Effect.




                                       11


                  (oo) Neither the Company nor any of its Subsidiaries, nor any
director, officer, agent, employee or other person associated with or acting on
behalf of the Company or any of its Subsidiaries, has used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; made any direct or indirect unlawful payment to
any foreign or domestic government official or employee from corporate funds;
violated or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977; or made any bribe, rebate, payoff, influence payment, kickback or
other unlawful payment.

                  (pp) Except as disclosed in the Offering Memorandum, and
except for such matters as would not, individually or in the aggregate, either
result in a Material Adverse Effect or require disclosure in the Offering
Memorandum, the Company and each of its Subsidiaries (or, to the knowledge of
the Company or any of its Subsidiaries, any of their respective predecessors in
interest) (1) is conducting and have conducted the business, operations and
facilities in compliance with Environmental Laws (as defined below); (2) have
duly obtained, possess, maintain in full force and effect, and have fulfilled
and performed all of its obligations under any and all permits, licenses or
registrations required under Environmental Law ("ENVIRONMENTAL PERMITS"); (3) is
not party to, or otherwise bound by, any contract under which it is obligated by
any representation, warranty, indemnification, covenant, restriction or other
undertaking concerning any material liability under Environmental Law or related
to the remediation of any Hazardous Substances (as defined below); (4) have not
received any notice from a governmental authority or any other third party
alleging any violation of Environmental Law or liability thereunder (including,
without limitation, liability as a "potentially responsible party" and/or for
costs of investigating or remediating sites containing Hazardous Substances
and/or damages to natural resources); (5) is not subject to any pending or, to
the best knowledge of the Company or any of its Subsidiaries, threatened claim
or other legal proceeding under any Environmental Laws; and (6) does not have
any knowledge of any pending Environmental Law, or any unsatisfied condition in
an Environmental Permit, or any release of Hazardous Substances that,
individually or in the aggregate, can reasonably be expected to form the basis
of any such claim or legal proceeding against the Company or any of its
Subsidiaries or to require any material capital expenditures to maintain the
Company's or any of its Subsidiaries' compliance with Environmental Law or with
their Environmental Permits. As used in this paragraph, "ENVIRONMENTAL LAWS"
means any and all applicable federal, state, local, and foreign laws, statutes,
ordinances, rules, regulations, requirements and common law, or any enforceable
administrative or judicial interpretation, order, consent, decree or judgment
thereof, relating to pollution or the protection of human health or the
environment, including, without limitation, those relating to, regulating, or
imposing liability or standards of conduct concerning (i) noise or odor, (ii)
emissions, discharges, releases or threatened releases of Hazardous Substances
into ambient air, surface water, groundwater or land, (iii) the generation,
manufacture, processing, distribution, use, treatment, storage, disposal,
release, transport or handling of, or exposure to, Hazardous Substances, (iv)
the protection of wildlife or endangered or threatened species, or (v) the
investigation, remediation or cleanup of any Hazardous Substances. As used in
this paragraph, "HAZARDOUS SUBSTANCES" means pollutants, contaminants or
hazardous, dangerous, toxic, biohazardous or infectious substances, materials,
constituents or wastes or toxins, petroleum, petroleum products and their
breakdown constituents, or any other chemical substance regulated under
Environmental Laws or exhibiting a hazardous waste characteristic including but
not limited to corrosivity, ignitability, toxicity, or reactivity, whether
solid, gaseous or liquid in nature.




                                       12


                  (qq) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of the
Notes), will violate or result in a violation of Section 7 of the Exchange Act,
or any regulation promulgated thereunder, including, without limitation,
Regulations T, U and X of the Board of Governors of the Federal Reserve System.

                  (rr) Prior to the date hereof, neither the Company nor any of
its Affiliates nor any person acting on its or their behalf (other than you, as
to whom the Company makes no representation) has taken any action that is
designed to or that has constituted or that might have been expected to cause or
result in stabilization or manipulation of the price of any security of the
Company in connection with the Offering.

                  (ss) The minute books and records of the Company and its
Subsidiaries relating to proceedings of their respective shareholders, boards of
directors, and committees of their respective boards of directors made available
to Shearman & Sterling, counsel for the Initial Purchasers, are their original
minute books and records or are true, correct and complete copies thereof, with
respect to all proceedings of said shareholders, boards of directors and
committees since three years prior to the date of the document request letter
dated May 5, 2003 delivered to the Company by Shearman & Sterling through the
date hereof. In the event that definitive minutes have not been prepared with
respect to any proceedings of such shareholders, boards of directors or
committees, the Company has provided Shearman & Sterling with originals or true,
correct and complete copies of draft minutes or written agendas relating
thereto, which drafts and agendas, if any, reflect all events that occurred in
connection with such proceedings.

                  (tt) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 under the
Exchange Act), which (i) are designed to ensure that material information
relating to the Company, including its consolidated subsidiaries, is made known
to the Company's principal executive officer and its principal financial officer
by others within those entities, particularly during the periods in which the
periodic reports required under the Exchange Act are being prepared; (ii) have
been evaluated for effectiveness as of a date within 90 days prior to the date
of the Company's most recent annual or quarterly report; and (iii) are effective
in all material respects to perform the functions for which they were
established.

                  (uu) Based on the evaluation of its disclosure controls and
procedures, the Company is not aware of (i) any significant deficiency in the
design or operation of internal controls which could adversely affect the
Company's ability to record, process, summarize and report financial data either
with respect to itself or any of its consolidated subsidiaries or any material
weaknesses in internal controls; or (ii) any fraud, whether or not material,
that involves management or other employees who have a significant role in the
Company's internal controls.

                  (vv) Since the date of the most recent evaluation of such
disclosure controls and procedures, there have been no significant changes in
internal controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses.




                                       13


                  (ww) The Company is, and immediately after the Closing Date
will be, Solvent. As used herein, the term "Solvent" means, with respect to the
Company on a particular date, that on such date (i) the Company would be able to
pay its debts as they become due in the usual course of business, and (ii) the
Company's total assets would be greater than the sum of its total liabilities
plus the amount that would be needed, if the Company were to be dissolved upon
the consummation of the Transactions, to satisfy the preferential rights upon
dissolution of shareholders of the Company whose preferential rights are
superior of those receiving the distribution in the Transactions.

                  (xx) The Common Stock of the Company is registered pursuant to
Section 12(b) of the Exchange Act and is listed on the New York Stock Exchange
(the "NYSE"), and the Company has taken no action designed to, or likely to have
the effect of, terminating the registration of the Common Stock under the
Exchange Act or delisting the Common Stock from the NYSE, nor has the Company
received any notification that the Commission or the NYSE is contemplating
terminating such registration or listing.

                  (yy) The Company is subject to and, except for the failure to
file separate audited financial statements for its affiliate, Premier Custodial
Group, for each of the fiscal years ended December 30, 2001 and December 31,
2000, (i) is in full compliance with the reporting requirements of Section 13 or
15(d) of the Exchange Act and (ii) each report filed by the Company with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act complied as to
form in all material respects at the time of its filing with or will comply as
to form in all material respects at the time of the filing thereof with the
Exchange Act and the rules and regulations of the Commission thereunder.

                  (zz) Except as disclosed in the Offering Memorandum, no
subsidiary of the Company is currently prohibited, directly or indirectly, from
paying any dividends to the Company, from making any other distribution on such
subsidiary's capital stock, from repaying to the Company any loans or advances
to such subsidiary from the Company or from transferring any of such
subsidiary's property or assets to the Company or any other subsidiary of the
Company.

         3. PURCHASE OF THE NOTES BY THE INITIAL PURCHASERS, AGREEMENTS TO SELL,
PURCHASE AND RESELL. (a) The Company hereby agrees, on the basis of the
representations, warranties and agreements of the Initial Purchasers contained
herein and subject to all the terms and conditions set forth herein, to issue
and sell to the Initial Purchasers and, upon the basis of the representations,
warranties and agreements of the Company herein contained and subject to all the
terms and conditions set forth herein, each Initial Purchaser agrees, severally
and not jointly, to purchase from the Company, at a purchase price of 97 % of
the principal amount thereof, the total principal amount of Notes set forth
opposite the name of such Initial Purchaser in Schedule I hereto. The Company
shall not be obligated to deliver any of the securities to be delivered
hereunder except upon payment for all of the securities to be purchased as
provided herein.

                  (b) Each of the Initial Purchasers, severally and not jointly,
hereby represents and warrants to the Company that (i) it will offer the Notes
for sale upon the terms and conditions set forth in this Agreement and in the
Offering Memorandum (ii) it has all requisite corporation power and authority to
enter into this Agreement and (iii) it has duly authorized, executed and
delivered this Agreement. Each of the Initial Purchasers hereby represents and
warrants to, and agrees with, the Company that such Initial Purchaser: (i) is a
QIB with such knowledge and experience in financial and business matters as are



                                       14


necessary in order to evaluate the merits and risks of an investment in the
Notes; (ii) is purchasing the Notes pursuant to a private sale exempt from
registration under the Act; (iii) in connection with the Exempt Resales, will
solicit offers to buy the Notes only from, and will offer to sell the Notes only
to, the Eligible Purchasers in accordance with this Agreement and on the terms
contemplated by the Offering Memorandum; and (iv) will not offer or sell the
Notes, nor has it offered or sold the Notes by, or otherwise engaged in, any
form of general solicitation or general advertising (within the meaning of
Regulation D, including, but not limited to, advertisements, articles, notices
or other communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising) and will
not engage in any directed selling efforts within the meaning of Rule 902 under
the Act, in connection with the offering of the Notes. The Initial Purchasers
have advised the Company that they will offer the Notes to Eligible Purchasers
at a price initially equal to 100% of the principal amount thereof, plus accrued
interest, if any, from the date of issuance of the Notes. Such price may be
changed by the Initial Purchasers at any time without notice.

                  Each of the Initial Purchasers understands that the Company
and, for purposes of the opinions to be delivered to the Initial Purchasers
pursuant to Sections 7(c) and 7(d) hereof, counsel to the Company and counsel to
the Initial Purchasers, will rely upon the accuracy and truth of the foregoing
representations, warranties and agreements and the Initial Purchasers hereby
consent to such reliance.

                  (c) Notwithstanding any of the foregoing, the Company shall
not be obligated to deliver any of the securities to be delivered hereunder
unless each of the Transactions shall have been consummated in accordance with
the terms of the Transaction Documents as in effect on the date of the Offering
Memorandum. Other than as set forth in Section 5(s) and in Sections 6, 8, 11 and
14 hereof, in the event the Company exercises its rights under this Section
3(c), the Company shall have no further obligations to the Initial Purchasers,
including the obligation to deliver the securities in accordance with the terms
of Section 3(a) hereof.

         4. DELIVERY OF THE NOTES AND PAYMENT THEREFOR. Delivery to the Initial
Purchasers of and payment for the Notes shall be made at the office of the
Company, 621 NW 53rd Street, Suite 700, Boca Raton, Florida 33487 (or such other
place as my be agreed by the Company and the Initial Purchasers), at 9:00 A.M.,
New York City time on July 9, 2003, or such other time and date as the Initial
Purchasers shall designate by notice to the Company (the "CLOSING DATE").

                  The Notes will be delivered to the Initial Purchasers, or the
Trustee as custodian for The Depository Trust Company ("DTC"), against payment
by or on behalf of the Initial Purchasers of the purchase price therefor by wire
transfer in immediately available funds, by causing DTC to credit the Notes to
the account of the Initial Purchasers at DTC. The Notes will be evidenced by one
or more global securities in definitive form (the "GLOBAL NOTES") registered in
the name of Cede & Co. as nominee of DTC. The Global Notes in definitive form
shall be made available to the Initial Purchasers in New York City for
inspection and packaging not later than 9:30 A.M., New York City time, on the
business day next preceding the Closing Date.




                                       15


         5. AGREEMENTS OF THE COMPANY. The Company agrees with each of the
Initial Purchasers as follows:

                  (a) The Company will furnish to the Initial Purchasers,
without charge, as of the date of the Offering Memorandum, such number of copies
of the Offering Memorandum as may then be amended or supplemented as they may
reasonably request.

                  (b) The Company will not make any amendment or supplement to
the Preliminary Offering Memorandum or to the Offering Memorandum of which the
Initial Purchasers shall not previously have been advised or to which they shall
have reasonably objected within five business days after being furnished with a
copy of such proposed amendment or supplement.

                  (c) The Company consents to the use, in accordance with the
securities or Blue Sky laws of the jurisdictions in which the Notes are offered
by the Initial Purchasers and by dealers, prior to the date of the Offering
Memorandum, of each Preliminary Offering Memorandum so furnished by the Company.
The Company consents to the use of the Offering Memorandum in accordance with
the securities or Blue Sky laws of the jurisdictions in which the Notes are
offered by the Initial Purchasers and by all dealers to whom Notes may be sold,
in connection with the offering and sale of the Notes.

                  (d) If, at any time prior to completion of the distribution of
the Notes by the Initial Purchasers to Eligible Purchasers, any event occurs or
information becomes known that, in the judgment of the Company or in the opinion
of counsel for the Initial Purchasers, should be set forth in the Offering
Memorandum so that the Offering Memorandum does not include any untrue statement
of material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary to supplement or amend the Offering
Memorandum in order to comply with any law, the Company will forthwith prepare
an appropriate supplement or amendment thereto, and will expeditiously furnish
at its own expense to the Initial Purchasers and dealers a reasonable number of
copies thereof.

                  (e) The Company will cooperate with the Initial Purchasers and
with their counsel in connection with the qualification or registration of the
Notes for offering and sale by the Initial Purchasers and by dealers under (or
obtain exemptions from the application of) the securities or Blue Sky laws of
such jurisdictions as the Initial Purchasers may designate and will file such
consents to service of process or other documents necessary or appropriate in
order to effect such qualifications, registrations and exemptions; PROVIDED that
in no event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action that would
subject it to service of process in suits, other than those arising out of the
offering or sale of the Notes, in any jurisdiction where it is not now so
subject. The Company will advise the Initial Purchasers promptly of the
suspension or qualification or registration of (or any such exemption relating
to) the Notes for offering, sale or trading in any jurisdiction or any
initiation or threat of any proceeding for any such purpose, and in the event of
the issuance of any order suspending such qualification, registration or
exemption, the Company shall use its best efforts to obtain the withdrawal
thereof at the earliest possible moment.




                                       16


                  (f) For a period of 180 days from the date of the Offering
Memorandum, the Company agrees not to, directly or indirectly, sell, offer to
sell, contract to sell, grant any option to purchase, issue any instrument
convertible into or exchangeable for, or otherwise transfer or dispose of (or
enter into any transaction or device that is designed to, or could be expected
to, result in the disposition in the future of), any debt securities of the
Company or any of its Subsidiaries similar to the Notes (which debt securities
shall not include borrowings in connection with a customary commercial credit
facility), except (i) in exchange for the Exchange Notes in connection with the
Exchange Offer or (ii) with the prior consent of the Initial Purchasers.

                  (g) For so long as any Notes or Exchange Notes remain
outstanding, the Company will furnish to any Initial Purchaser upon request (i)
as soon as practicable after the filing thereof, copies of the Annual Report on
Form 10-K of the Company containing the balance sheet of the Company as of the
close of such fiscal year and statements of income, stockholders' equity and
cash flows for the year then ended and the opinion thereon of the Company's
independent public or certified public accountants; (ii) as soon as practicable
after the filing thereof, copies of each proxy statement, Quarterly Report on
Form 10-Q, Current Report on Form 8-K or other report filed by the Company with
the Commission, the NYSE or any securities exchange or inter-dealer quotation
system; (iii) as soon as available, copies of any report or communication of the
Company mailed generally to holders of its capital stock or debt securities
(including the holders of the Notes); and (iv) from time to time such other
information concerning the Company as the Initial Purchasers may reasonably
request.

                  (h) The Company will apply the net proceeds from the sale of
the Notes to be sold by it hereunder substantially in accordance with the
description set forth in the Offering Memorandum under the caption "Use of
Proceeds."

                  (i) Except as stated in this Agreement and in the Preliminary
Offering Memorandum and Offering Memorandum, neither the Company nor any of its
Affiliates has taken, nor will any of them take, directly or indirectly, any
action designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Notes. Except as permitted by the Act, the
Company will not distribute any offering material in connection with the Exempt
Resales.

                  (j) The Company will use their best efforts to permit the
Notes to be designated Private Offerings, Resales and Trading through Automated
Linkages (PORTAL) MarketSM (the "PORTAL MARKETSM") securities in accordance with
the rules and regulations adopted by the National Association of Securities
Dealers, Inc. relating to trading in the PORTAL MarketSM and to permit the Notes
to be eligible for clearance and settlement through DTC.

                  (k) During the period of two years after the Closing Date, the
Company will not, and will not permit any of its Affiliates, to, resell any of
the Notes that constitute "restricted securities" under Rule 144 that have been
reacquired by any of them.




                                       17


                  (l) The Company agrees that it will not and will cause its
Affiliates not to make any offer or sale of securities of the Company of any
class if, as a result of the doctrine of "integration" referred to in Rule 502
under the Act, such offer or sale would render invalid (for the purpose of the
sale of the Notes by the Company to the Initial Purchasers, (i) the resale of
the Notes by the Initial Purchasers to Eligible Purchasers or (ii) the resale of
the Notes by such Eligible Purchasers to others) the exemption from the
registration requirements of the Act provided by Section 4(2) thereof or by Rule
144A or by Regulation S thereunder or otherwise.

                  (m) The Company agrees to comply with all the terms and
conditions of the Registration Rights Agreement and all agreements set forth in
the representation letter of the Company to DTC relating to the approval of the
Notes by DTC for "book entry" transfer.

                  (n) The Company will take such steps as shall be necessary to
ensure that neither the Company nor any of the Company's Subsidiaries becomes an
"investment company" within the meaning of such term under the Investment
Company Act of 1940, as amended.

                  (o) Each certificate for a Note will bear the legend contained
in "Notice to Investors" in the Offering Memorandum for the time period and upon
the other terms stated in the Offering Memorandum.

                  (p) Prior to the completion of the placement of the Notes by
the Initial Purchasers with the Eligible Purchasers, the Company shall file, on
a timely basis, with the Commission and the NYSE all reports and documents
required to be filed under Section 13 or 15 of the Exchange Act. Additionally,
at any time when the Company is not subject to Section 13 or 15 of the Exchange
Act and so long as any of the Notes qualify as "restricted securities" within
the meaning of Rule 144(a)(3) of the Act, for the benefit of holders and
beneficial owners from time to time of Notes, the Company shall furnish, at its
expense, upon request, to holders and beneficial owners of Notes and prospective
purchasers of Notes information ("ADDITIONAL ISSUER INFORMATION") satisfying the
requirements of Rule 144A(d)(4).

                  (q) The Company shall comply with the terms of the Indenture
and the Offering Memorandum and shall promptly notify the Initial Purchasers if
the Company discovers that any of its representations contained in this
Agreement is not, at any time prior to the completion of the distribution of the
Notes, true and correct, or if the Company has at any such time breached any of
its obligations hereunder.

                  (r) The Company will do and perform all things required or
necessary to be done and performed under this Agreement by it prior to the
Closing Date, and to satisfy all conditions precedent to the Initial Purchasers'
obligations hereunder to purchase the Notes.

                  (s) The Company shall use its best efforts to cause (i) each
of the Transactions to be consummated in accordance with the terms of the
Transaction Documents as described in the Offering Memorandum and (ii) each of
the conditions to the consummation of the Transactions set forth in each of the
Transaction Documents to be satisfied.

         6. EXPENSES. Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement becomes effective or is terminated,
the Company agrees, to pay all costs, expenses, fees and taxes incident to and
in connection with: (i) the preparation, printing, filing and distribution of




                                       18


the Preliminary Offering Memorandum and the Offering Memorandum (including,
without limitation, financial statements and exhibits) and all amendments and
supplements thereto (including the fees, disbursements and expenses of the
Company's accountants and counsel); (ii) the reasonable fees and disbursement of
Shearman & Sterling, counsel to the Initial Purchasers, incurred in connection
with the Offering; (iii) the preparation, printing (including, without
limitation, word processing and duplication costs) and delivery of this
Agreement, the Indenture, the Registration Rights Agreement, all Blue Sky
Memoranda and all other agreements, memoranda, correspondence and other
documents printed and delivered in connection therewith and with the Exempt
Resales; (iv) the issuance and delivery by the Company of the Notes and any
taxes payable in connection therewith; (v) all necessary issue, transfer and
other stamp taxes in connection with the issuance and sale of the Notes to the
Initial Purchasers; (vi) the qualification of the Notes and Exchange Notes for
offer and sale under the securities or Blue Sky laws of the several states
(including, without limitation, the reasonable fees and disbursements of your
counsel relating to such registration or qualification); (vii) all fees and
expenses of the Trustee, including the fees and disbursements of counsel for the
Trustee in connection with the Indenture, the Notes and the Exchange Notes;
(viii) the furnishing of such copies of the Preliminary Offering Memorandum and
the Offering Memorandum, and all amendments and supplements thereto, as may be
reasonably requested for use in connection with the Exempt Resales; (ix) the
preparation of certificates for the Notes (including, without limitation,
printing and engraving thereof); (x) the application for quotation of the Notes
in the PORTAL MarketSM (including all disbursements and listing fees); (xi) the
approval of the Notes by DTC for "book-entry" transfer (including fees and
expenses of counsel); (xii) the rating of the Notes and the Exchange Notes;
(xiii) the performance by the Company of its other obligations under this
Agreement; and (xiv) all travel expenses (including expenses related to
chartered aircraft) of each Initial Purchaser and the Company's officers and
employees and any other expenses of each Initial Purchaser and the Company in
connection with attending or hosting meetings with prospective purchasers of the
Notes.

         7. CONDITIONS TO INITIAL PURCHASERS' OBLIGATIONS. The respective
obligations of the Initial Purchasers hereunder are subject to the accuracy,
when made and on and as of the Closing Date, of the representations and
warranties of the Company contained herein, to the performance by the Company of
its obligations hereunder, and to each of the following additional terms and
conditions:

                  (a) The Initial Purchasers shall not have discovered and
disclosed to the Company on or prior to the Closing Date that the Offering
Memorandum or any amendment or supplement thereto contains an untrue statement
of a fact that, in the opinion of Shearman & Sterling, counsel to the Initial
Purchasers, is material or omits to state a fact that, in the opinion of such
counsel, is material and is required to be stated therein or is necessary to
make the statements therein not misleading.

                  (b) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Notes, the
Exchange Notes, the Registration Rights Agreement, the Indenture and the
Offering Memorandum, and all other legal matters relating to this Agreement and
the Transactions shall be reasonably satisfactory in all material respects to
Shearman & Sterling, counsel for the Initial Purchasers, and the Company shall



                                       19


have furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.

                  (c) Akerman Senterfitt shall have furnished to the Initial
Purchasers its written opinion (containing customary assumptions,
qualifications, limitations and exceptions acceptable to the Initial
Purchasers), as counsel to the Company, addressed to the Initial Purchasers and
dated the Closing Date, as set forth in Exhibit C hereto.

                  (d) Each of Stephenson Harwood, Edward, Nathan & Friedland and
Baker & McKenzie, respectively, shall have furnished to the Initial Purchasers
its written opinion (containing customary assumptions, qualifications,
limitations and exceptions acceptable to the Initial Purchasers, as counsel to
Wackenhut Corrections (UK) Limited, Wackenhut Corrections Corporation South
Africa (Pty) Limited and Wackenhut Corrections Corporation Australia Pty. Ltd.,
respectively, addressed to the Initial Purchasers and dated the Closing Date, in
the form of Exhibit D hereto or in substance satisfactory to the Initial
Purchasers.

                  (e) The Initial Purchasers shall have received from Shearman &
Sterling, counsel for the Initial Purchasers, such opinion or opinions, dated
the Closing Date, with respect to the issuance and sale of the Notes, the
Offering Memorandum and other related matters as the Initial Purchasers may
reasonably require, and the Company shall have furnished to such counsel such
documents and information as they reasonably request for the purpose of enabling
them to pass upon such matters.

                  (f) At the time of execution of this Agreement, the Initial
Purchasers shall have received from Ernst & Young LLP a letter, in form and
substance satisfactory to the Initial Purchasers, addressed to the Initial
Purchasers and dated the date hereof (i) confirming that they are independent
public accountants within the meaning of the Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission and (ii) stating, as of the date hereof
(or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Offering Memorandum, as of a date not more than five days prior to the date
hereof), the conclusions and findings of such firm with respect to the financial
information and (iii) covering such other matters as are ordinarily covered by
accountants' "comfort letters" to underwriters in connection with registered
public offerings.

                  (g) With respect to the letter of Ernst & Young LLP referred
to in the preceding paragraph and delivered to the Initial Purchasers
concurrently with the execution of this Agreement (the "INITIAL LETTER"), the
Company shall have furnished to the Initial Purchasers a letter (the "BRING-DOWN
LETTER") of such accountants, addressed to the Initial Purchasers and dated the
Closing Date (i) confirming that they are independent public accountants within
the meaning of the Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the Closing Date (or, with respect to
matters involving changes or developments since the respective dates as of which
specified financial information is given in the Offering Memorandum, as of a
date not more than three days prior to the date of the Closing Date), the
conclusions and findings of such firm with respect to the financial information
and other matters covered by the initial letter and (iii) confirming in all
material respects the conclusions and findings set forth in the initial letter.




                                       20


                  (h) Neither the Company nor any of its Subsidiaries shall have
sustained, since the date of the latest audited financial statements included in
the Offering Memorandum, any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth or contemplated in the Offering Memorandum;
and, since such date, except as otherwise disclosed in the Offering Memorandum,
there shall not have been any material change in the stockholders' equity or
long-term debt of the Company or any of its Subsidiaries or a Material Adverse
Effect affecting the management, condition, financial or otherwise,
stockholders' equity, results of operations, business or prospects of the
Company and its subsidiaries, taken as a whole.

                  (i) On the Closing Date, the Initial Purchasers shall have
received a written certificate executed by the Chief Financial Officer of the
Company, dated as of the Closing Date, to the effect that:

                  (i) the representations, warranties and covenants of the
         Company set forth in Section 2 of this Agreement are true and correct
         with the same force and effect as though expressly made on and as of
         the Closing Date;

                  (ii) the Company has complied with all the agreements and
         satisfied all the conditions on their part to be performed or satisfied
         at or prior to the Closing Date;

                  (iii) for the period from and after the date of this Agreement
         and prior to the Closing Date there has not occurred any Material
         Adverse Effect; and

                  (iv) to such officer's actual knowledge the issuance and sale
         of the Notes by the Company has not been enjoined by any court or
         governmental body or agency.

                  (j) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule 436(g)(2) of the
Rules and Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.

                  (k) At the Closing Date, the Notes shall have been designated
for trading on the PORTAL MarketSM and shall be eligible for clearance and
settlement through DTC.

                  (l) The Company shall have executed and delivered the
Registration Rights Agreement, and the Initial Purchasers shall have received an
original copy thereof, duly executed by the Company.

                  (m) The Company and the Trustee shall have executed and
delivered the Indenture and the Initial Purchasers shall have received an
original copy thereof, duly executed by the Company and the Trustee.



                                       21



                  (n) At the Closing Date, each of the Transactions shall have
been consummated in accordance with the terms of the Transaction Documents as in
effect on the date of the Offering Memorandum.

                  (o) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading or quotation in
securities generally on the New York Stock Exchange, the Nasdaq National Market
System or the American Stock Exchange or in the over-the-counter market, or
trading in any securities of the Company on any exchange or in the
over-the-counter market, has been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by such
exchange or by any other regulatory body or governmental authority having
jurisdiction; (ii) a material disruption in securities settlement, payment or
clearance services in the United States; (iii) a banking moratorium has been
declared by Federal or state authorities; (iv) any attack on, outbreak or
escalation of hostilities or act of terrorism involving the United States, any
declaration of war by Congress or any other national or international calamity,
crisis or emergency if, in the judgment of the Initial Purchasers, the effect of
any such attack, outbreak, escalation, act, declaration, calamity, crisis or
emergency makes it impractical or inadvisable to proceed with completion of the
Offering or sale of and payment for the Notes; (v) the occurrence of any other
calamity, crisis (including without limitation as a result of terrorist
activities), or material adverse change in general economic, political or
financial conditions (or the effect of international conditions on the financial
markets in the United States shall be such) as to make it, in the judgment of
the Initial Purchasers, impracticable or inadvisable to proceed with the
Offering or the delivery of the Notes being delivered on the Closing Date or
that, in the judgment of the Initial Purchasers, would materially and adversely
affect the financial markets or the markets for the Notes and other debt
securities.

                  (p) On or before the Closing Date, the Initial Purchasers and
counsel for the Initial Purchasers shall have received such information,
documents and opinions as they may reasonably require for the purposes of
enabling them to pass upon the issuance and sale of the Notes as contemplated
herein, or in order to evidence the accuracy of any of the representations and
warranties, or the satisfaction of any of the conditions or agreements, herein
contained.

                  (q) Each of the conditions to the closing of the Share
Repurchase as set forth in the agreements governing the Share Repurchase
(without giving effect to any amendment, waiver or supplement thereto) as of the
date hereof shall have been satisfied.

                  (r) John J. Bulfin, Esq., General Counsel of the Company shall
have furnished to the Initial Purchasers his written opinion (containing
customary assumptions, qualifications, limitations and exceptions acceptable to
the Initial Purchasers) addressed to the Initial Purchasers and dated the
Closing Date in the form of Exhibit E hereto.

                  All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Initial Purchasers.



                                       22


         8. INDEMNIFICATION AND CONTRIBUTION.

                  (a) The Company hereby agrees to indemnify and hold harmless
each Initial Purchaser, its directors, officers and employees and each person,
if any, who controls any Initial Purchaser within the meaning of the Act, from
and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Notes and
relating to the Company's exercise of its rights pursuant to Section 3(c)
hereof), to which that Initial Purchaser, director, officer, employee or
controlling person may become subject, under the Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Offering Memorandum or the Offering Memorandum
or in any amendment or supplement thereto or (B) in any Blue Sky application or
other document prepared or executed by the Company (or based upon any written
information furnished by the Company) specifically for the purpose of qualifying
any or all of the Notes under the securities laws of any state or other
jurisdiction (any such application, document or information being hereinafter
called a "BLUE SKY APPLICATION"), (ii) the omission or alleged omission to state
in any Preliminary Offering Memorandum or the Offering Memorandum, or in any
amendment or supplement thereto, or in any Blue Sky Application, any 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 or (iii) any act or failure to act or any alleged act or failure to
act by any Initial Purchaser in connection with, or relating in any manner to,
the Notes or the Offering, and that is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (PROVIDED that the Company shall not be
liable under this clause (iii) to the extent that it is determined in a final
judgment by a court of competent jurisdiction that such loss, claim, damage,
liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Initial Purchaser through its gross
negligence or willful misconduct), and shall reimburse each Initial Purchaser
and each such director, officer, employee or controlling person promptly upon
demand for any legal or other expenses reasonably incurred by that Initial
Purchaser, director, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; PROVIDED, HOWEVER,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Offering Memorandum or Offering Memorandum, or in any
such amendment or supplement thereto, in reliance upon and in conformity with
written information concerning such Initial Purchaser furnished to the Company
through the Initial Purchasers by or on behalf of any Initial Purchaser
specifically for inclusion therein. The foregoing indemnity agreement is in
addition to any liability that the Company may otherwise have to any Initial
Purchaser or to any director, officer, employee or controlling person of that
Initial Purchaser.

                  (b) Each Initial Purchaser, severally and not jointly, hereby
agrees to indemnify and hold harmless the Company, its officers and employees,
each of its directors, and each person, if any, who controls the Company within
the meaning of the Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the Company or any
such director, officer, employee or controlling person may become subject, under
the Act or otherwise, insofar as such loss, claim, damage, liability or action


                                       23


arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in any Preliminary Offering
Memorandum or the Offering Memorandum or in any amendment or supplement thereto,
or (ii) the omission or alleged omission to state in any Preliminary Offering
Memorandum or the Offering Memorandum, or in any amendment or supplement
thereto, any material fact required to be stated therein or necessary to make
the statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information concerning
such Initial Purchaser furnished to the Company by or on behalf of that Initial
Purchaser specifically for inclusion therein, and shall reimburse the Company
and any such director, officer, employee or controlling person for any legal or
other expenses reasonably incurred by the Company or any such director, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred. The foregoing indemnity agreement is in addition to
any liability that any Initial Purchaser may otherwise have to the Company or
any such director, officer, employee or controlling person.

                  (c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability that it may have under this Section 8 except to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses 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 this
Section 8. If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation; PROVIDED,
HOWEVER, that the Initial Purchasers shall have the right to employ counsel to
represent jointly the Initial Purchasers and those Initial Purchasers and their
respective directors, officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity may
be sought by the Initial Purchasers against the Company under this Section 8 if,
in the reasonable judgment of the Initial Purchasers, it is advisable for the
Initial Purchasers and those directors, officers, employees and controlling
persons to be jointly represented by separate counsel, and in that event the
fees and expenses of such separate counsel shall be paid by the Company. No
indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any



                                       24


pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with the consent of the indemnifying party or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.

                  (d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Initial Purchasers on the other
from the offering of the Notes or (ii) if the allocation provided by clause (i)
above 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 Company, on the one hand, and the Initial
Purchasers on the other with respect to the statements or omissions that
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company, on the one hand, and the Initial Purchasers on the
other with respect to such offering shall be deemed to be in the same proportion
as the total net proceeds from the offering of the Notes purchased under this
Agreement (before deducting expenses) received by the Company on the one hand,
and the total initial purchasers' discounts and commissions received by the
Initial Purchasers with respect to the Notes purchased under this Agreement, on
the other hand, bear to the total gross proceeds from the offering of the Notes
under this Agreement as set forth on the cover page of the Offering Memorandum.
The relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or the
Initial Purchasers, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Initial Purchasers agree that it would not be just
and equitable if contributions pursuant to this Section 8(d) were to be
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation that does
not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim,
damage or liability, or action in respect thereof, referred to above in this
Section 8(d) shall be deemed to include, for purposes of this Section 8(d), any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8(d), no Initial Purchaser shall
be required to contribute any amount in excess of the amount by which the total
price at which the Notes initially purchased by it were offered to the Eligible
Purchasers exceeds the total price at which such Initial Purchaser purchased the
Notes from the Company. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The Initial
Purchasers' obligations to contribute as provided in this Section 8(d) are
several in proportion to their respective underwriting obligations and not
joint.



                                       25


                  (e) The Initial Purchasers severally confirm and the Company
acknowledges that (i) the names of the Initial Purchasers at set forth on the
cover page of the Offering Memorandum and (ii) the statements with respect to
the offering of the Notes by the Initial Purchasers set forth in the first
sentence of the third paragraph of the section entitled "Plan of Distribution"
in the Offering Memorandum are correct and constitute the only information
concerning such Initial Purchasers furnished in writing to the Company by or on
behalf of the Initial Purchasers specifically for inclusion in the Offering
Memorandum.

         9. DEFAULTING INITIAL PURCHASERS. If, on the Closing Date, any Initial
Purchaser defaults in the performance of its obligations under this Agreement,
the remaining non-defaulting Initial Purchasers shall be obligated to purchase
the Notes that the defaulting Initial Purchaser agreed but failed to purchase on
the Closing Date in the respective proportions that the number of Notes set
opposite the name of each remaining non-defaulting Initial Purchaser in Schedule
I hereto bears to the total number of Notes set opposite the names of all the
remaining non-defaulting Initial Purchasers in Schedule I hereto; PROVIDED,
HOWEVER, that the remaining non-defaulting Initial Purchasers shall not be
obligated to purchase any of the Notes on the Closing Date if the total number
of Notes that the defaulting Initial Purchaser or Initial Purchasers agreed but
failed to purchase on such date exceeds 9.09% of the total number of Notes to be
purchased on the Closing Date, and any remaining non-defaulting Initial
Purchasers shall not be obligated to purchase more than 110% of the number of
Notes that it agreed to purchase on the Closing Date pursuant to the terms of
Section 3. If the foregoing maximums are exceeded, the remaining non-defaulting
Initial Purchasers, or those other Initial Purchasers satisfactory to the
Initial Purchasers who so agree, shall have the right, but shall not be
obligated, to purchase, in such proportion as may be agreed upon among them, all
the Notes to be purchased on the Closing Date. If the remaining Initial
Purchasers or other Initial Purchasers satisfactory to the Initial Purchasers do
not elect to purchase the Notes that the defaulting Initial Purchaser or Initial
Purchasers agreed but failed to purchase on the Closing Date, this Agreement
shall terminate without liability on the part of any non-defaulting Initial
Purchaser or the Company, except that the Company will continue to be liable for
the payment of expenses to the extent set forth in Sections 6 and 11.

                  Nothing contained herein shall relieve a defaulting Initial
Purchaser of any liability it may have to the Company for damages caused by its
default. If other Initial Purchasers are obligated or agree to purchase the
Notes of a defaulting or withdrawing Initial Purchaser, either the remaining
Initial Purchasers or the Company may postpone the Closing Date for up to seven
full business days in order to effect any changes that in the opinion of counsel
for the Company or counsel for the Initial Purchasers may be necessary in the
Offering Memorandum or in any other document or arrangement.

         10. TERMINATION. The obligations of the Initial Purchasers hereunder
may be terminated by the Initial Purchasers by notice given to and received by
the Company prior to delivery of and payment for the Notes if, prior to that
time, any of the events described in Sections 7(h) or 7(o) shall have occurred
or if the Initial Purchasers shall decline to purchase the Notes for any reason
permitted under this Agreement.

         11. REIMBURSEMENT OF INITIAL PURCHASERS' EXPENSES. If the Company fails
to tender the Notes for delivery to the Initial Purchasers by reason of any
failure, refusal or inability on the part of the Company to perform any



                                       26


agreement on its part to be performed, or because any other condition of the
obligations hereunder required to be fulfilled by the Company is not fulfilled,
the Company shall reimburse the Initial Purchasers for all reasonable
out-of-pocket expenses incurred by the Initial Purchasers in connection with
this Agreement and the proposed purchase and offerings and sale of the Notes,
including but not limited to fees and disbursements of counsel, printing
expenses, travel expenses, postage, facsimile and telephone charges, and upon
demand the Company shall pay the full amount thereof to the Initial Purchasers.
If this Agreement is terminated pursuant to Section 9 by reason of the default
of one or more Initial Purchasers, the Company shall not be obligated to
reimburse any defaulting Initial Purchaser on account of those expenses.

         12. NOTICES, ETC. All communications hereunder shall be in writing and
shall be mailed, hand delivered or telecopied and confirmed to the parties
hereto as follows:

                  If to the Initial Purchasers:

                  BNP Paribas Securities Corp.
                  The Equitable Tower
                  787 Seventh Avenue
                  New York, NY 10019

                  Facsimile: (212) 841-3561
                  Attention:  Douglas Cook, Esq.


                  Lehman Brothers Inc.
                  745 Seventh Avenue
                  New York, NY 10019

                  Facsimile:  212-526-0943
                  Attention:  Syndicate

                  and

                  Lehman Brothers Inc.
                  Litigation Department
                  399 Park Avenue
                  New York, NY 10022

                  with a copy to:

                  Shearman & Sterling LLP
                  599 Lexington Avenue
                  New York, NY 10022

                  Facsimile:  (212) 848-7179
                  Attention:  Andrew R. Schleider, Esq.



                                       27


                  If to the Company:

                  Wackenhut Corrections Corporation
                  One Park Place
                  621 NW 53rd Street
                  Boca Raton, Florida 33487

                  Facsimile:  (561) 999-7744
                  Attention:  John J. Bulfin, Esq.

                  with a copy to:

                  Akerman Senterfitt
                  One Southeast Third Avenue
                  28th Floor
                  Miami, Florida 33131-1714

                  Facsimile:  (305) 374-5095
                  Attention:  Stephen K. Roddenberry

                  Any such statements, requests, notices or agreements shall
take effect at the time delivered by hand, if personally delivered; two business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next business day, if timely delivered to an air courier guaranteeing
overnight delivery.

         13. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the Initial Purchasers, the Company,
and their respective successors. The term "successors" shall not include any
purchaser of the Notes as such from any of the Initial Purchasers merely by
reason of such purchase. This Agreement and the terms and provisions hereof are
for the sole benefit of only those persons, except that (A) the representations,
warranties, indemnities and agreements of the Company contained in this
Agreement shall also be deemed to be for the benefit of directors of the Initial
Purchasers, officers of the Initial Purchasers and any person or persons
controlling any Initial Purchaser within the meaning of Section 15 of the Act
and (B) the indemnity agreement of the Initial Purchasers contained in Section
8(b) of this Agreement shall be deemed to be for the benefit of directors of the
Company, officers of the Company and any person controlling the Company within
the meaning of Section 15 of the Act. Nothing in this Agreement is intended or
shall be construed to give any person, other than the persons referred to in
this Section 13, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein.

         14. SURVIVAL. The respective indemnities, representations, warranties
and agreements of the Company and the Initial Purchasers contained in this
Agreement or made by or on behalf on them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Notes and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.




                                       28


         15. DEFINITION OF THE TERM "BUSINESS DAY" and "SUBSIDIARY." For
purposes of this Agreement, "business day" means any day on which the New York
Stock Exchange, Inc. is open for trading and (ii) "subsidiary" means any entity
the total voting capital stock of which is more than 50% controlled, either
directly or indirectly by the Company or a Subsidiary.

         16. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any
Section, paragraph or provision of this Agreement shall not affect the validity
or enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.

         17. GOVERNING LAW. (a) THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK.

                  (b) Any legal suit, action or proceeding arising out of or
based upon this Agreement or the transactions contemplated hereby ("RELATED
PROCEEDINGS") may be instituted in the federal courts of the United States of
America located in the City and County of New York or the courts of the State of
New York in each case located in the City and County of New York (collectively,
the "SPECIFIED COURTS"), and each party irrevocably submits to the non-exclusive
jurisdiction (except for proceedings instituted in regard to the enforcement of
a judgment of any such court (a "RELATED JUDGMENT"), as to which such
jurisdiction is non-exclusive) of such courts in any such suit, action or
proceeding. Service of any process, summons, notice or document by mail to such
party's address set forth above shall be effective service of process for any
suit, action or other proceeding brought in any such court. The parties
irrevocably and unconditionally waive any objection to the laying of venue of
any suit, action or other proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such suit, action or other proceeding brought in any such court has been brought
in an inconvenient forum.

         18. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.

         19. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.




                                       29






                  If the foregoing correctly sets forth the agreement among the
Company, and the Initial Purchasers, please indicate your acceptance in the
space provided for that purpose below.

Very truly yours,

WACKENHUT CORRECTIONS CORP.



By: /s/ John G. O'Rourke
    -----------------------------------------------------
     Name:  John G. O'Rourke
     Title: Chief Financial Officer-Senior Vice President



Accepted:

BNP PARIBAS SECURITIES CORP.
LEHMAN BROTHERS INC.
FIRST ANALYSIS SECURITIES CORPORATION
SOUTHTRUST SECURITIES, INC.
COMERICA SECURITIES, INC.
Acting severally on behalf of themselves and the
several Initial Purchasers
named in Schedule I hereto:


By:  BNP Paribas Securities Corp.



By: /s/ Douglas Cook
    ----------------------------------------
    Name:  Douglas Cook
    Title: Managing Director



                                       30






                                   SCHEDULE I
                                                                  PRINCIPAL
                                                                  AMOUNT OF
                                                                    NOTES
                                                                    TO BE
              INITIAL PURCHASERS                                  PURCHASED
              ------------------                                  ---------

BNP Paribas Securities Corp...............................       $82,800,000
Lehman Brothers Inc.......................................        55,200,000
First Analysis Securities Corporation.....................         8,250,000
SouthTrust Securities, Inc................................         2,250,000
Comerica Securities, Inc..................................         1,500,000
                                                                -------------
     Total................................................      $150,000,000
                                                                ==============




                                       31

                               [EXHIBITS OMITTED]

EX-4.1

                                                                     EXHIBIT 4.1

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



                        WACKENHUT CORRECTIONS CORPORATION





                          8 1/4% SENIOR NOTES DUE 2013










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


                                    INDENTURE

                            Dated as of July 9, 2003


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


                              THE BANK OF NEW YORK

                                     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).........................................................2.06
     (b).........................................................11.03
     (c).........................................................11.03
  313(a).........................................................7.06
     (b)(1)......................................................N.A.
     (b)(2)......................................................7.06, 7.07
     (c).........................................................7.06, 11.02
     (d).........................................................7.06
  314(a).........................................................11.05
     (b).........................................................N.A.
     (c)(1)......................................................N.A.
     (c)(2)......................................................N.A.
     (c)(3)......................................................N.A.
     (d).........................................................N.A.
     (e).........................................................11.05
     (f).........................................................N.A.
  315(a).........................................................N.A.
     (b).........................................................N.A.
     (c).........................................................N.A.
     (d).........................................................N.A.
     (e).........................................................N.A.
  316(a) (last sentence).........................................N.A.
     (a)(1)(A)...................................................N.A.
     (a)(1)(B)...................................................N.A.
     (a)(2)......................................................N.A.
     (b).........................................................N.A.
     (c).........................................................11.14
  317(a)(1)......................................................N.A.
     (a)(2)......................................................N.A.
     (b).........................................................N.A.
  318(a).........................................................N.A.
     (b).........................................................N.A.
     (c).........................................................11.01

- --------
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.






                                TABLE OF CONTENTS



                                                                                                               PAGE
                                                                                                               ----
                                                                                                        

CROSS-REFERENCE TABLE...........................................................................................i

                                                              ARTICLE ONE
                                                     DEFINITIONS AND INCORPORATION
                                                              BY REFERENCE

Section 1.01          Definitions...............................................................................1
Section 1.02          Other Definitions........................................................................22
Section 1.03          Incorporation by Reference of Trust Indenture Act........................................22
Section 1.04          Rules of Construction....................................................................23

                                                              ARTICLE TWO
                                                               THE NOTES

Section 2.01          Form and Dating..........................................................................23
Section 2.02          Execution and Authentication.............................................................24
Section 2.03          Methods of Receiving Payments on the Notes...............................................25
Section 2.04          Registrar and Paying Agent...............................................................25
Section 2.05          Paying Agent to Hold Money in Trust......................................................26
Section 2.06          Holder Lists.............................................................................26
Section 2.07          Transfer and Exchange....................................................................26
Section 2.08          Replacement Notes........................................................................39
Section 2.09          Outstanding Notes........................................................................39
Section 2.10          Treasury Notes...........................................................................40
Section 2.11          Temporary Notes..........................................................................40
Section 2.12          Cancellation.............................................................................40
Section 2.13          Defaulted Interest.......................................................................40
Section 2.14          CUSIP Numbers............................................................................41

                                                             ARTICLE THREE
                                                      REDEMPTION AND PREPAYMENT;
                                                      SATISFACTION AND DISCHARGE

Section 3.01          Notices to Trustee.......................................................................41
Section 3.02          Selection of Notes to Be Redeemed........................................................41
Section 3.03          Notice of Redemption.....................................................................41
Section 3.04          Effect of Notice of Redemption...........................................................42
Section 3.05          Deposit of Redemption Price..............................................................42
Section 3.06          Notes Redeemed in Part...................................................................43
Section 3.07          Optional Redemption......................................................................43
Section 3.08          Repurchase Offers........................................................................44
Section 3.09          Application of Trust Money...............................................................45



                                       i




                                                                                                               PAGE
                                                                                                               ----
                                                                                                        


                                                             ARTICLE FOUR
                                                               COVENANTS

Section 4.01          Payment of Notes.........................................................................46
Section 4.02          Maintenance of Office or Agency..........................................................46
Section 4.03          Reports..................................................................................47
Section 4.04          Compliance Certificate...................................................................47
Section 4.05          Taxes....................................................................................48
Section 4.06          Stay, Extension and Usury Laws...........................................................48
Section 4.07          Restricted Payments......................................................................48
Section 4.08          Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries................51
Section 4.09          Incurrence of Indebtedness and Issuance of Preferred Stock...............................53
Section 4.10          Asset Sales..............................................................................57
Section 4.11          Transactions with Affiliates.............................................................59
Section 4.12          Liens....................................................................................60
Section 4.13          Business Activities......................................................................60
Section 4.14          Offer to Repurchase upon a Change of Control.............................................60
Section 4.15          Limitation on Issuances and Sales of Equity Interests in Restricted Subsidiaries.........61
Section 4.16          Designation of Restricted and Unrestricted Subsidiaries..................................61
Section 4.17          Payments for Consent.....................................................................62
Section 4.18          Sale and Leaseback Transactions..........................................................62
Section 4.19          Additional Note Guarantees...............................................................62

                                                             ARTICLE FIVE
                                                              SUCCESSORS

Section 5.01          Merger, Consolidation or Sale of Assets..................................................63

                                                             ARTICLE SIX
                                                        DEFAULTS AND REMEDIES

Section 6.01          Events of Default........................................................................64
Section 6.02          Acceleration.............................................................................65
Section 6.03          Other Remedies...........................................................................66
Section 6.04          Waiver of Past Defaults..................................................................66
Section 6.05          Control by Majority......................................................................66
Section 6.06          Limitation on Suits......................................................................67
Section 6.07          Rights of Holders of Notes to Receive Payment............................................67
Section 6.08          Collection Suit by Trustee...............................................................67
Section 6.09          Trustee May File Proofs of Claim.........................................................68
Section 6.10          Priorities...............................................................................68
Section 6.11          Undertaking for Costs....................................................................69



                                       ii




                                                                                                               PAGE
                                                                                                               ----
                                                                                                        


                                                             ARTICLE SEVEN
                                                                TRUSTEE

Section 7.01          Duties of Trustee........................................................................69
Section 7.02          Certain Rights of Trustee................................................................70
Section 7.03          Individual Rights of Trustee.............................................................71
Section 7.04          Trustee's Disclaimer.....................................................................71
Section 7.05          Notice of Defaults.......................................................................71
Section 7.06          Reports by Trustee to Holders of the Notes...............................................71
Section 7.07          Compensation and Indemnity...............................................................72
Section 7.08          Replacement of Trustee...................................................................73
Section 7.09          Successor Trustee by Merger, Etc.........................................................74
Section 7.10          Eligibility; Disqualification............................................................74
Section 7.11          Preferential Collection of Claims Against Company........................................74
Section 7.12          Trustee's Application for Instructions from the Company..................................74

                                                             ARTICLE EIGHT
                                                  DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01          Option to Effect Legal Defeasance or Covenant Defeasance.................................74
Section 8.02          Legal Defeasance and Discharge...........................................................75
Section 8.03          Covenant Defeasance......................................................................75
Section 8.04          Conditions to Legal or Covenant Defeasance...............................................76
Section 8.05          Deposited Money and Government Securities to Be Held in Trust;
                      Other Miscellaneous Provisions...........................................................77
Section 8.06          Repayment to the Company.................................................................77
Section 8.07          Reinstatement............................................................................78

                                                            ARTICLE NINE
                                                  AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01          Without Consent of Holders of Notes......................................................78
Section 9.02          With Consent of Holders of Notes.........................................................79
Section 9.03          Compliance with Trust Indenture Act......................................................81
Section 9.04          Revocation and Effect of Consents........................................................81
Section 9.05          Notation on or Exchange of Notes.........................................................81
Section 9.06          Trustee to Sign Amendments, Etc..........................................................81

                                                             ARTICLE TEN
                                                     SATISFACTION AND DISCHARGE

Section 10.01         Satisfaction and Discharge...............................................................81
Section 10.02         Deposited Money and Government Securities to Be Held in Trust; Other
                      Miscellaneous Provisions.................................................................82
Section 10.03         Repayment to the Company.................................................................83



                                      iii





                                                                                                               PAGE
                                                                                                               ----
                                                                                                        

                                                            ARTICLE ELEVEN
                                                            MISCELLANEOUS

Section 11.01         Trust Indenture Act Controls.............................................................83
Section 11.02         Notices..................................................................................83
Section 11.03         Communication by Holders of Notes with Other Holders of Notes............................84
Section 11.04         Certificate and Opinion as to Conditions Precedent.......................................85
Section 11.05         Statements Required in Certificate or Opinion............................................85
Section 11.06         Rules by Trustee and Agents..............................................................85
Section 11.07         No Personal Liability of Directors, Officers, Employees and Stockholders.................85
Section 11.08         Governing Law............................................................................86
Section 11.09         Consent to Jurisdiction..................................................................86
Section 11.10         No Adverse Interpretation of Other Agreements............................................86
Section 11.11         Successors...............................................................................86
Section 11.12         Severability.............................................................................86
Section 11.13         Counterpart Originals....................................................................86
Section 11.14         Acts of Holders..........................................................................87
Section 11.15         Benefit of Indenture.....................................................................88
Section 11.16         Table of Contents, Headings, Etc.........................................................88
Section 11.17         Waiver of Jury Trial.....................................................................88




                                    EXHIBITS

Exhibit A         FORM OF 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 July 9, 2003 between Wackenhut
Corrections Corporation, a Florida corporation (the "COMPANY") and The Bank of
New York, a banking corporation organized and existing under the laws of the
State of New York, as Trustee.

                  The Company and the Trustee (as defined below) agree as
follows for the benefit of each other and for the equal and ratable benefit of
the Holders (as defined below) of the 8 1/4% Senior Notes due 2013:

                                  ARTICLE ONE
                          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 shall be issued in a denomination equal
to the outstanding principal amount at maturity of the Notes sold in reliance on
Rule 144A.

                  "ACQUIRED DEBT" means, with respect to any specified Person:
(i) Indebtedness of any other Person existing at the time such other Person is
merged 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 (ii) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.

                  "ADDITIONAL NOTES" means an unlimited maximum aggregate
principal amount of Notes (other than the Notes issued on the date hereof)
issued under this Indenture in accordance with Sections 2.02 and 4.09 hereof.

                  "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, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise; 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" shall have correlative meanings.

                  "AGENT" means any Registrar, Paying Agent or co-registrar.

                  "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, transfer, assignment, conveyance or other
         disposition of any assets or rights; PROVIDED that the sale, lease,
         conveyance, transfer, assignment or other disposition of all or
         substantially all of the assets of the Company and its Restricted
         Subsidiaries taken as a whole will be governed by Sections 4.14 and/or
         5.01 hereof and not by Section 4.10 hereof; and

                  (2) the issuance or sale by the Company or any of its
         Restricted Subsidiaries of Equity Interests of any of the Company's
         Subsidiaries.

Notwithstanding the preceding, the following items will not be deemed to be
Asset Sales:

                  (i) any single transaction or series of related transactions
         that involves the sale of assets or the issuance or sale of Equity
         Interests of a Restricted Subsidiary having a fair market value of less
         than $2.0 million;

                  (ii) a transfer of assets by the Company to any of its
         Restricted Subsidiaries or by any Restricted Subsidiary to the Company
         or any other Restricted Subsidiary;

                  (iii) an issuance of Equity Interests by a Restricted
         Subsidiary to the Company or to another Restricted Subsidiary;

                  (iv) the sale or lease of equipment, inventory, accounts
         receivable or other assets in the ordinary course of business;

                  (v) the sale or other disposition of cash or Cash Equivalents;
         and

                  (vi) a Restricted Payment or Permitted Investment that is
         permitted by Section 4.07 hereof.

                  "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.

                  "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" shall 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" shall have a
corresponding meaning.


                                       2



                  "BOARD OF DIRECTORS" means: (1) with respect to a corporation,
the board of directors of the corporation; (2) with respect to a partnership,
the board of directors of the general partner of the partnership; and (3) with
respect to any other Person, the board or committee of such Person serving a
similar function.

                  "BROKER-DEALER" has the meaning set forth in the Registration
Rights Agreement.

                  "BUSINESS DAY" means any day which is not a Legal Holiday.

                  "CAPITAL LEASE OBLIGATION" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at 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) 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; (2)
Government Securities having maturities of not more than one year from the date
of acquisition; (3) certificates of deposit and eurodollar time deposits with
maturities of one year or less from the date of acquisition, bankers'
acceptances with maturities not exceeding one year and overnight bank deposits,
in each case, with any lender party to the Credit Agreement or with any domestic
commercial bank having capital and surplus in excess of $500.0 million and a
Thomson Bank Watch Rating of "B" or better; (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 the highest rating obtainable from Moody's Investors
Service, Inc. or Standard & Poor's Rating Services and in each case maturing
within one year after the date of acquisition; and (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.

                  "CHANGE OF CONTROL" means the occurrence of any of the
following:

                  (1) the direct or indirect sale, transfer, assignment, lease,
         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 assets of the Company and its Restricted
         Subsidiaries, taken as a whole, to any "person" (as that term is used
         in Section 13(d)(3) of the Exchange Act);

                  (2) the adoption of a plan by the Company 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" or "group" (as that term is used in Sections 13(d) and 14(d)



                                       3


         of the Exchange Act) becomes the Beneficial Owner, directly or
         indirectly, of more than 40% of the Voting Stock of the Company;

                  (4) the Company consolidates with, or merges with or into, any
         Person, or any Person consolidates with, or merges with or into, the
         Company, in any such event pursuant to a transaction in which any of
         the outstanding Voting Stock of the Company or such other Person is
         converted into or exchanged for cash, securities or other property,
         other than any such transaction where (A) the Voting Stock of the
         Company outstanding immediately prior to such transaction is converted
         into or exchanged for Voting Stock (other than Disqualified Stock) of
         the surviving or transferee Person constituting a majority of the
         outstanding shares of such Voting Stock of such surviving or transferee
         Person (immediately after giving effect to such issuance) and (B)
         immediately after such transaction, no "person" or "group" (as such
         terms are used in Section 13(d) and 14(d) of the Exchange Act),
         becomes, directly or indirectly, the Beneficial Owner of 40% or more of
         the voting power of all classes of Voting Stock of the Company; or

                  (5) 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.

                  "CLOSING DATE" means July 9, 2003.

                  "COMPANY" means Wackenhut Corrections Corporation.

                  "CONSOLIDATED CASH FLOW" means, with respect to any specified
Person for any period, the Consolidated Net Income of such Person for such
period; PLUS, in each case, to the extent deducted in computed Consolidated Net
Income,

                  (1) losses realized by such Person and its Restricted
         Subsidiaries in connection with sales of assets outside the ordinary
         course of business; PLUS

                  (2) provision for taxes based on income or profits of such
         Person and its Restricted Subsidiaries for such period; 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 letters of credit or bankers' acceptance financings, and net of the
         effect of all payments made or received pursuant to Hedging
         Obligations), net of Non-Recourse Interest Payments received in cash by
         the Company or any Restricted Subsidiary relating to any Non-Recourse
         Project Financing Indebtedness up to the amount of interest expense for
         such Non-Recourse Project Financing Indebtedness; PLUS




                                       4


                  (4) depreciation, amortization (including amortization of
         intangibles but excluding amortization of prepaid cash expenses that
         were paid in a prior period) and other non-cash expenses (excluding any
         such non-cash expense to the extent that it represents an accrual of or
         reserve for cash payments 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; MINUS

                  (5) non-cash 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.

                  Notwithstanding the preceding, the provision for taxes based
on the income or profits of, and the depreciation and amortization and other
non-cash expenses of, a Restricted Subsidiary of the Company shall be added to
Consolidated Net Income to compute Consolidated Cash Flow of the Company only to
the extent that a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior governmental approval (that has not been obtained), and pursuant
to the terms of its charter and all agreements, instruments, judgments, decrees,
orders, statutes, rules and governmental regulations applicable to that
Restricted Subsidiary or its stockholders.

                  "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 (but not loss) of any Person that is not a
         Restricted Subsidiary 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 shall 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;

                  (3) the Net Income of any Person acquired during such period
         for any period prior to the date of such acquisition shall be excluded;

                  (4) the cumulative effect of a change in accounting principles
         shall be excluded; and

                  (5) the Net Income or loss of any Unrestricted Subsidiary will
         be excluded, whether or not distributed to the specified Person or one
         of its Restricted Subsidiaries.



                                       5



                  "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; or

                  (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.

                  "CORPORATE TRUST OFFICE" means the principal office of the
Trustee at which at any time its corporate trust business shall be administered,
which office at the date hereof is located at the address of the Trustee
specified in Section 11.02 hereof, or such other address as to which the Trustee
may from time to time give notice to the Company and to the Holders.

                  "CREDIT AGREEMENT" means that certain Credit Agreement, by and
among the Company, the guarantor subsidiaries named therein, BNP Paribas as
administrative agent for the lenders and as lead arranger and syndication agent
and the other lenders named therein, and other parties thereto, including any
related notes, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in each case as amended (and/or amended
and restated), modified, renewed, refunded, replaced or refinanced from time to
time, in whole or in part, with the same or different lenders (including,
without limitation, any amendment, amendment and restatement, modification,
renewal, refunding, replacement or refinancing that increases the maximum amount
of the loans made or to be made thereunder).

                  "CREDIT FACILITIES" means one or more debt facilities
(including, without limitation, the Credit Agreement) or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, project financings, 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) or letters
of credit, in each case, as amended (and/or amended and restated), restated,
modified, renewed, refunded, replaced or refinanced in whole or in part from
time to time.

                  "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 2.07 hereof,
substantially in the form of Exhibit A 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 2.04
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.

                  "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



                                       6


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 thereof have the right to require
the Company to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale shall 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 Section 4.07 hereof.

                  "DOMESTIC 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 (but not the laws of Puerto Rico) or the District of Columbia or
that guarantees or otherwise provides direct credit support for any Indebtedness
of the Company or any Guarantor.

                  "EQUITY INTERESTS" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).

                  "EQUITY OFFERING" means an offering of Capital Stock (other
than Disqualified Stock or Capital Stock that by its terms has a preference in
liquidation or as to dividends over any other Capital Stock) of the Company
(other than (1) an offering pursuant to a registration statement on Form S-8 or
otherwise relating to equity securities issuable under any employee benefit plan
of the Company and (2) an offering with aggregate Net Proceeds to the Company of
less than $20.0 million).

                  "EUROCLEAR" means Morgan Guaranty Trust Company of New York,
Brussels office, an 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
in accordance with Section 2.07(f) hereof.

                  "EXCHANGE OFFER" has the meaning set forth in the Registration
Rights Agreement.

                  "EXCHANGE OFFER REGISTRATION STATEMENT" has the meaning set
forth in the Registration Rights Agreement.

                  "EXISTING INDEBTEDNESS" means the Indebtedness of the Company
and its Subsidiaries (other than Indebtedness under the Credit Agreement) in
existence on the date hereof, until such amounts are repaid.

                  "FIXED CHARGE COVERAGE RATIO" means with respect to any
specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person for such period to the Fixed Charges of such Person 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



                                       7


(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, PROVIDED, HOWEVER, that interest expense, if any,
attributable to any Non-Recourse Project Financing Indebtedness computed on a
pro forma basis, shall be computed giving pro forma effect to any Non-Recourse
Interest Payments related to such Non-Recourse Project Financing Indebtedness,
PROVIDED FURTHER that the obligation to make such Non-Recourse Interest Payments
commences with the incurrence of the corresponding Non-Recourse Project
Financing Indebtedness.

                  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, but without giving effect to clause (3)
         of the proviso set forth in the definition of Consolidated Net Income;

                  (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;
         and

                  (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.

                  "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 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 letters of credit or bankers' acceptance financings, and net of the



                                       8


         effect of all payments made or received pursuant to Hedging
         Obligations, net of Non-Recourse Interest Payments received in cash by
         the Company or any Restricted Subsidiary relating to any Non-Recourse
         Project Financing Indebtedness up to the amount of interest expense for
         such Non-Recourse Project Financing Indebtedness; PLUS

                  (2) any interest expense on Indebtedness of another Person to
         the extent such Indebtedness 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

                  (3) the product of (a) all dividends, whether paid or accrued
         and whether or not in cash, on any series of Disqualified Stock or
         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), 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 effective
         cash tax rate of such Person, expressed as a decimal, in each case,
         determined on a consolidated basis and in accordance with GAAP.

                  "FOREIGN SUBSIDIARY" means a Restricted Subsidiary of the
Company that is not a Domestic Subsidiary.

                  "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 amended and/or modified from time to time. All
ratios and computations contained or referred to herein shall be computed in
conformity with GAAP applied on a consistent basis, except that calculations
made for purposes of determining compliance with the terms of the covenants and
with other provisions of this Indenture shall be made without giving effect to
the amortization of any expenses incurred in connection with, or the write-off
of costs as a result of, the Transactions.

                  "GLOBAL NOTE LEGEND" means the legend set forth in Section
2.07(g)(ii), 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 issued in
accordance with certain sections of this Indenture.

                  "GOVERNMENT SECURITIES" means 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.

                  "GUARANTEE" means a guarantee other than by endorsement of
negotiable instruments for collection or deposit 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.




                                       9


                  "GUARANTORS" means any Restricted Subsidiary that executes a
Guarantee in accordance with provisions of this Indenture and its respective
successors and assigns.

                  "HEDGING OBLIGATIONS" means, with respect to any specified
Person, the obligations of such Person under:

                  (1) interest rate swap agreements, 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.

                  "HOLDER" means a Person in whose name a Note is registered.

                  "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, 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 a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, 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.

                  The amount of any Indebtedness outstanding as of any date will
be:

                  (A) the accreted value of the Indebtedness, in the case of any
         Indebtedness issued with original issue discount; and

                  (B) the principal amount of the Indebtedness, together with
         any interest on the Indebtedness that is more than 30 days past due, in
         the case of any other Indebtedness.

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




                                       10


                  "INDIRECT PARTICIPANT" means a Person who holds a beneficial
interest in a Global Note through a Participant.

                  "INITIAL PURCHASERS" means the initial purchasers as defined
in the Purchase Agreement dated July 1, 2003.

                  "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.

                  "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 commission, travel and similar advances to
officers and employees made 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 and including
the designation of a Restricted Subsidiary as an Unrestricted Subsidiary. 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 all Investments in such Restricted Subsidiary
not sold or disposed of in an amount determined as provided in 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 fair market value of the Investment held by the
acquired Person in such third Person in an amount determined as provided in the
final paragraph of Section 4.07 hereof.

                  "ISSUE DATE" means the Closing Date.

                  "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, 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



                                       11


lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction.

                  "LIQUIDATED DAMAGES" means all liquidated damages then owing
pursuant to Section 5 of the Registration Rights Agreement.

                  "NET INCOME" means, with respect to any specified Person for
any period, 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 (but not loss), together with any related
         provision for taxes on such gain (but not loss), realized in connection
         with: (a) any sale of assets outside the ordinary course of business;
         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
(including, without limitation, any cash or Cash Equivalents received upon the
sale or other disposition of any non-cash consideration received in any Asset
Sale), net of the direct costs relating to such Asset Sale, including, without
limitation, legal, accounting and investment banking fees, and sales
commissions, and any relocation expenses incurred as a result of the Asset Sale,
taxes paid or payable as a result of the Asset Sale, in each case, after taking
into account any available tax credits or deductions and any tax sharing
arrangements, and amounts required to be applied to the repayment of
Indebtedness, secured by a Lien on the asset or assets that were the subject of
such Asset Sale and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.

                  "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 that
         they will not have any recourse to the stock, property or assets of the
         Company or any of its Restricted Subsidiaries.




                                       12


                  "NON-RECOURSE PROJECT FINANCING INDEBTEDNESS" means any
Indebtedness of a Restricted Subsidiary (the "PROJECT FINANCING SUBSIDIARY")
incurred in connection with the acquisition, construction or development of any
facility:

                  (1) where such Project Financing Subsidiary operates or is
         responsible for the operation of the facility pursuant to a management
         services contract with a governmental entity;

                  (2) as to which neither the Company nor any of its Restricted
         Subsidiaries, other than such Project Financing Subsidiary, (a)
         provides credit support of any kind (including any undertaking,
         agreement or instrument that would constitute Indebtedness), it being
         understood that equity Investments funded at the time of or prior to
         the incurrence of such Indebtedness shall not be deemed credit support
         or (b) is directly or indirectly liable as a guarantor or otherwise;

                  (3) where, upon the termination of the management services
         contract with respect to such facility, neither the Company nor any of
         its Restricted Subsidiaries, other than the Project Financing
         Subsidiary, will be liable, directly or indirectly, to make any
         payments with respect to such Indebtedness (or portion thereof);

                  (4) the interest expense related to such Indebtedness is fully
         serviced by a separate corresponding payment with respect to such
         Indebtedness (the "NON-RECOURSE INTEREST PAYMENT") pursuant to an
         agreement with the governmental entity; and

                  (5) such Project Financing Subsidiary has no assets other than
         the assets, including working capital, reasonably related to the
         design, construction, management and financing of the facility.

                  "NON-U.S. PERSON" means a Person who is not a U.S. Person.

                  "NOTE GUARANTEE" has a meaning set forth in Exhibit F.

                  "NOTES" means the 8 1/4% Senior Notes due 2013 of the Company
issued on the date hereof and any Additional Notes, including the Exchange
Notes. The Notes and the Additional Notes, if any, shall be treated as a single
class for all purposes under this Indenture.

                  "OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

                  "OFFERING" means the offering of the Notes by the Company.

                  "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, an Assistant Secretary or any Vice-President of
such Person.




                                       13


                  "OFFICERS' CERTIFICATE" means a certificate signed on behalf
of the Company by at least 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 11.05 hereof.

                  "OPINION OF COUNSEL" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
11.05 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 BUSINESS" means the business conducted by the
Company and its Restricted Subsidiaries on the date hereof and businesses
reasonably related thereto or ancillary or incidental thereto or a reasonable
extension thereof, including the privatization of governmental services.

                  "PERMITTED DEBT" has the meaning set forth in Section 4.09(b)
hereof.

                  "PERMITTED INVESTMENTS" means:

                  (1) any Investment in the Company or in a Restricted
         Subsidiary of the Company that is a Guarantor (other than a Project
         Financing Subsidiary);

                  (2) any Investment in cash or Cash Equivalents;

                  (3) Investments in a Restricted Subsidiary that is not a
         Guarantor having an aggregate fair market value, when taken together
         with all other Investments made pursuant to this clause (3) not to
         exceed $5.0 million;

                  (4) Investments in a Foreign Subsidiary in an amount not to
         exceed the amount of Net Proceeds received from the sale of the
         Company's one-half ownership interest in Premier Custodial Group to
         Serco Investments Limited;

                  (5) any Investment by the Company or any Restricted Subsidiary
         of the Company in a Person (other than a Project Financing Subsidiary),
         if as a result of such Investment:

                           (a) such Person becomes (i) a Restricted Subsidiary
                  of the Company and (ii) a Guarantor; or

                           (b) 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 any Restricted Subsidiary of the Company that is a
                  Guarantor;

                  (6) any Investment made as a result of the receipt of non-cash
         consideration from an Asset Sale that was made pursuant to Section
         4.10;



                                       14



                  (7) [Intentionally omitted];

                  (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 entered into the ordinary course of
         business and not for any speculative purpose;

                  (10) other Investments in any other 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 (10)
         not to exceed: (a) $15.0 million; PLUS (b) the net reductions in
         Investments made pursuant to this clause (10) resulting from
         distributions on or repayments of such Investments or from the net cash
         proceeds from the sale or other disposition of any such investment;
         PROVIDED that the net reduction in any Investment shall not exceed the
         amount of such Investment;

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

                  (12) loans or advances to employees made in the ordinary
         course of business of the Company or any Restricted Subsidiary not to
         exceed $2.0 million outstanding at any one time for all loans or
         advances under this clause (12);

                  (13) stock, obligations or securities received in settlement
         of debts created in the ordinary course of business and owing to the
         Company or any Restricted Subsidiary or in satisfaction of judgments or
         pursuant to any plan of reorganization or similar arrangement upon the
         bankruptcy or insolvency of a debtor;

                  (14) Investments in existence on the date hereof;

                  (15) Investments that are made or received in exchange for
         Equity Interests (other than Disqualified Stock) of the Company;

                  (16) Investments in South African Services Pty Ltd. having an
         aggregate fair market value, when taken together with all other
         Investments made pursuant to this clause (16) not to exceed $3.0
         million; and

                  (17) any Investments made or acquired with the net cash
         proceeds of a substantially concurrent issuance or sale of Equity
         Interests (other than Disqualified Stock) of the Company.

                  "PERMITTED LIENS" means:



                                       15


                  (1) Liens on any assets (including real or personal property)
         of the Company and any Restricted Subsidiary securing Indebtedness and
         other Obligations under Credit Facilities that were permitted by the
         terms of this Indenture to be incurred;

                  (2) Liens in favor of the Company or the Guarantors;

                  (3) Liens on property of a Person existing at the time such
         Person is merged with or into or consolidated with the Company or any
         Restricted 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 Restricted Subsidiary;

                  (4) Liens on property existing at the time of acquisition of
         the property by the Company or any Restricted Subsidiary of the
         Company, PROVIDED that such Liens were in existence prior to the
         contemplation of such acquisition and do not extend to any property
         other than the property so acquired by the Company or the Restricted
         Subsidiary;

                  (5) Liens to secure the performance of statutory obligations,
         surety or appeal bonds, performance bonds or other obligations of a
         like nature incurred in the ordinary course of business;

                  (6) Liens to secure Indebtedness (including Capital Lease
         Obligations) incurred under Section 4.09(b)(iv);

                  (7) Liens existing on the date hereof;

                  (8) 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;

                  (9) Liens securing Permitted Refinancing Indebtedness;
         PROVIDED that any such Lien does not extend to or cover any property,
         Capital Stock or Indebtedness other than the property, shares or debt
         securing the Indebtedness so refunded, refinanced or extended;

                  (10) Attachment or judgment Liens not giving rise to a Default
         or an Event of Default;

                  (11) Liens on the Capital Stock of Unrestricted Subsidiaries
         securing Indebtedness of such Unrestricted Subsidiaries;

                  (12) Liens incurred in the ordinary course of business of the
         Company or any Subsidiary of the Company with respect to obligations
         that do not exceed $5.0 million at any one time outstanding;

                  (13) pledges or deposits under workmen's compensation laws,
         unemployment insurance laws or similar legislation, or good faith
         deposits in connection with bids, tenders, contracts (other than for




                                       16


         the payment of Indebtedness) or leases to which the Company or any
         Restricted Subsidiary is a party, or deposits to secure public or
         statutory obligations of the Company or any Restricted Subsidiary or
         deposits or cash or Government Securities to secure surety or appeal
         bonds to which the Company or any Restricted Subsidiary is a party, or
         deposits as security for contested taxes or import or customs duties or
         for the payment of rent, in each case incurred in the ordinary course
         of business;

                  (14) Liens imposed by law, including carriers', warehousemen's
         and mechanics' Liens, in each case for sums not yet due or being
         contested in good faith by appropriate proceedings if a reserve or
         other appropriate provisions; if any, as shall be required by GAAP
         shall have been made in respect thereof;

                  (15) encumbrances, easements or reservations of, or rights of
         others for, licenses, rights of way, sewers, electric lines, telegraph
         and telephone lines and other similar purposes, or zoning or other
         restrictions as to the use of real properties or liens incidental to
         the conduct of the business of the Company or a Restricted Subsidiary
         or to the ownership of its properties which do not in the aggregate
         materially adversely affect the value of said properties or materially
         impair their use in the operation of the business of the Company or
         such Restricted Subsidiary;

                  (16) Liens securing Hedging Obligations so long as the related
         Indebtedness is secured by a Lien on the same property securing such
         Hedging Obligations;

                  (17) leases and subleases of real property which do not
         materially interfere with the ordinary conduct of the business of the
         Company or any of its Restricted Subsidiaries; and

                  (18) normal customary rights of setoff upon deposits of cash
         in favor of banks or other depository institutions.

                  "PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of
the Company or any of its Restricted Subsidiaries issued in repayment of,
exchange for, or the net proceeds of which are used to extend, refinance, renew,
replace, repay, defease or refund other Indebtedness of the Company or any of
its Restricted Subsidiaries (other than intercompany Indebtedness and
Disqualified Stock of the Company or a Restricted Subsidiary); 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 so
         extended, refinanced, renewed, replaced, repaid, defeased or refunded
         (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 later 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 extended, refinanced,
         renewed, replaced, repaid, defeased or refunded;


                                       17



                  (3) if the Indebtedness being extended, refinanced, renewed,
         replaced, repaid, defeased or refunded 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 extended, refinanced,
         renewed, replaced, repaid, defeased or refunded; and

                  (4) such Indebtedness is incurred either by the Company or by
         any Restricted Subsidiary who is an obligor on the Indebtedness being
         extended, refinanced, renewed, replaced, repaid, defeased or refunded.

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

                  "PRIVATE PLACEMENT LEGEND" means the legend set forth in
Section 2.07(g)(i) 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.

                  "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of July 9, 2003, by and among 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.

                  "REGULATION S" means Regulation S promulgated under the
Securities Act.

                  "REGULATION S GLOBAL NOTE" means a global note 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 nominees that
shall be issued in a denomination equal to the outstanding principal amount at
maturity of the Notes resold in reliance on Regulation S.

                  "RESPONSIBLE OFFICER," when used with respect to the Trustee,
means any vice president, assistant vice president, treasurer, assistant
treasurer or other trust officer within the Corporate Trust Office 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 or her knowledge of and familiarity with the particular subject
and who shall have direct responsibility for the administration of this
Indenture.

                  "RESTRICTED DEFINITIVE NOTE" means a Definitive Note bearing
the Private Placement Legend.

                  "RESTRICTED GLOBAL NOTE" means a Global Note bearing the
Private Placement Legend.




                                       18


                  "RESTRICTED INVESTMENT" means an Investment other than a
Permitted Investment.

                  "RESTRICTED SUBSIDIARY" of the Company means any Subsidiary of
the Company 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 the Securities Act.

                  "SALE AND LEASEBACK TRANSACTIONS" means any direct or indirect
arrangement relating to property now owned or hereafter acquired whereby the
Company or a Restricted Subsidiary transfers such property to another Person and
the Company or a Restricted Subsidiary leases it from such Person other than a
lease properly characterized pursuant to GAAP as a Capital Lease Obligation,
PROVIDED, HOWEVER, that, with respect to properties developed or acquired by the
Company after the date hereof, any sale and leaseback of such properties
pursuant to the Right to Purchase Agreement, dated as of April 28, 1998 between
the Company and CPT Operating Partnership L.P. shall not be deemed a Sale and
Leaseback Transaction hereunder.

                  "SEC" means the Securities and Exchange Commission.

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

                  "SHELF REGISTRATION STATEMENT" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.

                  "SIGNIFICANT SUBSIDIARY" means any 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 such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall 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 thereof is at the time owned or controlled, directly or
indirectly, by such 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



                                       19


of such Person or (b) the only general partners of which are such Person or one
or more Subsidiaries of such Person (or any combination thereof).

                  "TIA" means the Trust Indenture Act of 1939, as in effect on
the date on which this Indenture is qualified under the TIA.

                  "TRANSACTIONS" means (i) the repurchase by the Company of 12.0
million shares of its common stock, (ii) the Credit Agreement and (iii) the
Offering.

                  "TRUSTEE" means The Bank of New York, 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 one or more Definitive
Notes that do not bear and are not required to bear the Private Placement
Legend.

                  "UNRESTRICTED GLOBAL NOTE" means a permanent Global Note
substantially in the form of Exhibit A attached hereto that bears the Global
Note Legend and that has the "Schedule of Exchanges of Interests in the Global
Note" attached thereto, and that is deposited with or on behalf of and
registered in the name of the Depositary, representing a series of Notes that do
not bear the Private Placement Legend.

                  "UNRESTRICTED SUBSIDIARY" means any Subsidiary of the Company
that is designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that 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 filing with the
Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted under Section 4.07
hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the
preceding requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture and any



                                       20


Indebtedness of such Subsidiary shall 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 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 or Event of
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 the 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" table under the heading "Currency
Trading" on the date two Business Days prior to such determination.

                  Except as described in 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 was initially incurred in such
currency.

                  "U.S. PERSON" means a U.S. person as defined in Rule 902(k)
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 or liquidation preference, as the case may be, 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 or
liquidation preference, as the case may be, 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) shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.



                                       21



                  "WHOLLY OWNED SUBSIDIARY" of any specified Person means a
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interest of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Subsidiaries of
such Person and one or more Wholly Owned Subsidiaries of such Person.

Section 1.02 OTHER DEFINITIONS.


                                                                   DEFINED
                                                                      IN
        TERM                                                       SECTION

        "AFFILIATE TRANSACTION"..................................    4.11
        "ASSET SALE OFFER".......................................    4.10
        "AUTHENTICATION ORDER"...................................    2.02
        "CHANGE OF CONTROL OFFER"................................    4.14
        "CHANGE OF CONTROL PAYMENT"..............................    4.14
        "CHANGE OF CONTROL PAYMENT DATE".........................    4.14
        "COVENANT DEFEASANCE"....................................    8.03
        "DTC"....................................................    2.04
        "EVENT OF DEFAULT".......................................    6.01
        "EXCESS PROCEEDS"........................................    4.10
        "INCUR"..................................................    4.09
        "LEGAL DEFEASANCE".......................................    8.02
        "OFFER AMOUNT"...........................................    3.08
        "OFFER PERIOD"...........................................    3.08
        "OFFSHORE TRANSACTION"...................................    2.07
        "PAYING AGENT"...........................................    2.04
        "PAYMENT DEFAULT"........................................    6.01
        "PERMITTED DEBT".........................................    4.09
        "PURCHASE DATE"..........................................    3.08
        "REGISTRAR"..............................................    2.04
        "RELATED JUDGMENT".......................................   11.09
        "RELATED PROCEEDINGS"....................................   11.09
        "REPURCHASE OFFER".......................................    3.08
        "RESALE RESTRICTION TERMINATION DATE"....................    2.07
        "RESTRICTED PAYMENTS"....................................    4.07
        "SPECIFIED COURTS".......................................   11.09

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;




                                       22


                  "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 means the Company and any successor
obligor upon the Notes.

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

Section 1.04 RULES OF CONSTRUCTION.

                  Unless the context otherwise requires:

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

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

                  (iii) "or" is not exclusive;

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

                  (v) provisions apply to successive events and transactions;
         and

                  (vi) references to sections of or rules under the Securities
         Act shall be deemed to include substitute, replacement of successor
         sections or rules adopted by the SEC from time to time.

                                  ARTICLE TWO
                                    THE NOTES

Section 2.01 FORM AND DATING.

                  (a) GENERAL. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be issued in registered, global form without interest coupons and only
shall be in minimum denominations of $1,000 and integral multiples of $1,000 in
excess thereof.

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



                                       23



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 shall be
substantially in the form of Exhibit A attached 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 shall be substantially
in the form of Exhibit A attached 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 shall represent such of the outstanding
Notes as shall be specified therein and each shall provide that it shall
represent 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 shall be made by the
Trustee in accordance with instructions given by the Holder thereof as required
by Section 2.07 hereof.

                  (c) 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 shall be applicable
to transfers of beneficial interests in the Regulation S Global Notes that are
held by Participants through Euroclear or Clearstream.

Section 2.02 EXECUTION AND AUTHENTICATION.

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

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

                  A Note shall not be valid until authenticated by the manual
signature of the Trustee. Such signature shall be conclusive evidence and the
only evidence, that the Note has been authenticated and delivered under this
Indenture.

                  The aggregate principal amount of Notes which may be
authenticated and delivered under this Indenture is unlimited.

                  The Trustee shall, upon a written order of the Company signed
by one Officer of the Company (an "AUTHENTICATION ORDER"), authenticate Notes
for original issue on the date hereof of $150.0 million. At any time and from
time to time after the execution of this Indenture, the Trustee shall, upon
receipt of an Authentication Order, authenticate Notes for original issue in
aggregate principal amount specified in such Authentication Order. The
Authentication Order shall specify the amount of Notes to be authenticated and
the date on which the Notes are to be authenticated. In authenticating such
Notes, and accepting the additional responsibilities under this Indenture in
relation to such Notes, the Trustee shall be entitled to receive and shall be
fully protected in relying upon:



                                       24



                  (a) A copy of the resolution or resolutions of the Board of
         Directors of the Company in or pursuant to which the terms of the Notes
         were established, certified by the Secretary or an Assistant Secretary
         of the Company to have been duly adopted by the Board of Directors and
         to be in full force and effect as of the date of such certificate;

                  (b) an Officers' Certificate delivered in accordance with
         Section 11.04(i) hereof; and

                  (c) an Opinion of Counsel which shall state:

                           (1) that such Notes, when authenticated and delivered
                           by the Trustee and issued by the Company in the
                           manner and subject to any conditions specified in
                           such Opinion of Counsel, will constitute valid and
                           legally binding obligations of the Company,
                           enforceable in accordance with their terms, subject
                           to bankruptcy, insolvency, reorganization and other
                           laws of general applicability relating to or
                           affecting the enforcement of creditors' rights and to
                           general equity principles; and

                           (2) that all laws and corporate requirements in
                           respect of the execution and delivery by the Company
                           of such Notes have been complied with.

                  The Trustee shall have the right to decline to authenticate
and deliver any Notes under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if the Trustee
in good faith shall determine that such action would expose the Trustee to
personal liability to existing Holders.

                  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 METHODS OF RECEIVING PAYMENTS ON THE NOTES.

                  If a Holder of Notes has given wire transfer instructions to
the Company, the Company shall 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 shall 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 addresses set forth in the register of Holders.

Section 2.04 REGISTRAR AND PAYING AGENT.

                  (a) The Company shall 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").




                                       25


The Registrar shall 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 prior notice to any Holder. The Company
shall 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.

                  (b) The Company initially appoints The Depositary Trust
Company ("DTC") to act as Depositary with respect to the Global Notes.

                  (c) 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 2.05 PAYING AGENT TO HOLD MONEY IN TRUST.

                  The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent shall hold in trust for the
benefit of 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 shall 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 one of its
Subsidiaries) shall have no further liability for the money. If the Company or
one of its Subsidiaries acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.

Section 2.06 HOLDER LISTS.

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

Section 2.07 TRANSFER AND EXCHANGE.

                  (a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may
not be transferred as a whole except 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
shall be exchanged by the Company for Definitive Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or



                                       26


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 120 days after the date of
such notice from the Depositary; (ii) 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
or (iii) there shall have occurred and be continuing a Default or Event of
Default with respect to the Notes. Upon the occurrence of any of the preceding
events in (i), (ii) or (iii) 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 2.08 and
2.11 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.07 or
Section 2.08 or 2.11 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 2.07(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.07(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 shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall 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 shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:

                  (i) 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.
         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 2.07(b)(i).

                  (ii) 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 2.07(b)(i) above,
         the transferor of such beneficial interest must deliver to the
         Registrar either (A) (1) 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 the Global Note in an amount equal to
         the beneficial interest to be transferred or exchanged and (2)
         instructions given in accordance with the Applicable Procedures
         containing information regarding the Participant account to be credited
         with such increase or (B) (1) 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 (2) 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. Upon consummation of an Exchange
         Offer by the Company in accordance with Section 2.07(f) hereof, the
         requirements of this Section 2.07(b)(ii) shall be deemed to have been




                                       27


         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 at maturity of the relevant Global Notes pursuant to
         Section 2.07(h) hereof.

                  (iii) 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 2.07(b)(ii) above and the
         Registrar receives the following:

                           (A) if the transferee shall 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; and

                           (B) if the transferee shall take delivery in the form
                  of a beneficial interest in the Regulation S Global Note, then
                  the transferor must deliver a certificate in the form of
                  Exhibit B hereto, including the certifications in item (2)
                  thereof.

                  (iv) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN A
         RESTRICTED GLOBAL NOTE FOR BENEFICIAL INTERESTS IN THE 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 2.07(b)(ii) 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 (1) a Broker-Dealer, (2) a Person
                  participating in the distribution of the Exchange Notes or (3)
                  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



                                       28


                           (D) the Registrar receives the following:

                                    (1) 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

                                    (2) 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.

                  (i) 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;



                                       29



                           (B) if such beneficial interest is being transferred
                  to a QIB in accordance with Rule 144A under the Securities
                  Act, a certificate to the effect set forth in Exhibit B
                  hereto, including the certifications in item (1) thereof;

                           (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 under the Securities Act,
                  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 under the
                  Securities Act, 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
         2.07(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 2.07(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 2.07(c)(i) shall bear
         the Private Placement Legend and shall be subject to all restrictions
         on transfer contained therein.

                  (ii) 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



                                       30


         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 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 (1) a Broker-Dealer, (2) a Person participating
                  in the distribution of the Exchange Notes or (3) 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:

                                    (1) if the holder of such beneficial
                           interest in a Restricted Global Note proposes to
                           exchange such beneficial interest for a Definitive
                           Note that does not bear the Private Placement Legend,
                           a certificate from such Holder in the form of Exhibit
                           C hereto, including the certifications in item (1)(b)
                           thereof; or

                                    (2) 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
                           Definitive Note that does not bear the Private
                           Placement Legend, 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.

                  (iii) 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
         2.07(b)(ii) hereof, the Trustee shall cause the aggregate principal
         amount of the applicable Global Note to be reduced accordingly pursuant
         to Section 2.07(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 pursuant



                                       31

         to this Section 2.07(c)(iii) 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 pursuant to this
         Section 2.07(c)(iii) shall not bear the Private Placement Legend.

                  (d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR BENEFICIAL
INTERESTS.

                  (i) 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 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 under the
                  Securities Act, 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 under the Securities Act,
                  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
                  under the Securities Act, 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



                                       32


                  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 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, and in the case of clause
         (C) above, the Regulation S Global Note.

                  (ii) 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 (1) a
                  Broker-Dealer, (2) a Person participating in the distribution
                  of the Exchange Notes or (3) 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:

                                    (1) 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

                                    (2) 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.




                                       33


                  Upon satisfaction of the conditions of any of the
         subparagraphs in this Section 2.07(d)(ii), the Trustee shall cancel the
         Definitive Notes and increase or cause to be increased the aggregate
         principal amount of the Unrestricted Global Note.

                  (iii) 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 shall 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 (ii)(B),
         (ii)(D) or (iii) 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 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 2.07(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly 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
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.07(e).

                  (i) 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 shall be made pursuant to Rule
                  144A under the Securities Act, 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 shall 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 shall 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.



                                       34



                  (ii) 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 (1) a
                  Broker-Dealer, (2) a Person participating in the distribution
                  of the Exchange Notes or (3) 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:

                                    (1) 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

                                    (2) 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;

                  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 Company 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.

                  (iii) 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 shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02,
the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an




                                       35


aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not a
Broker-Dealer who acquired Notes directly from the Company or an affiliate of
the Company, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates (as defined in Rule 144) of the Company,
and accepted for exchange in the Exchange Offer and (ii) Definitive Notes in an
aggregate principal amount equal to the principal amount of the Restricted
Definitive Notes accepted for exchange in the Exchange Offer. Concurrently with
the issuance of such Notes, the Trustee shall cause the aggregate principal
amount of the applicable Restricted Global Notes to be reduced accordingly, and
the Company shall execute and the Trustee shall 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 shall 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.

                  (i) PRIVATE PLACEMENT LEGEND. Except as permitted 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 AND ANY GUARANTEES OF THIS NOTE HAVE NOT
                  BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
                  (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
                  THIS NOTE NOR ANY GUARANTEES OF THIS NOTE NOR ANY INTEREST OR
                  PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED,
                  TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
                  THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
                  EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
                  OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS
                  ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER
                  SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE
                  LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON
                  WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE
                  OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE
                  "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO THE COMPANY
                  OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE
                  REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO
                  LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
                  144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT
                  REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS



                                       36


                  DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
                  THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
                  IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
                  144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS
                  THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
                  REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO
                  ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
                  OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
                  TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i)
                  PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY
                  DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF
                  REGULATION S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE
                  (E) PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO
                  REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
                  AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND
                  (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A
                  CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS
                  COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS
                  LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE
                  RESALE RESTRICTION TERMINATION DATE.

         Notwithstanding the foregoing, any Global Note or Definitive Note
         issued pursuant to subparagraph (b)(iv), (c)(ii), (c)(iii), (d)(ii),
         (d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.07 (and all Notes
         issued in exchange therefor or substitution thereof) shall not bear the
         Private Placement Legend.

                  (ii) GLOBAL NOTE LEGEND. Each Global Note shall 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
                  (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
                  REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS
                  GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT
                  TO SECTION 2.07(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE
                  MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
                  SECTION 2.12 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
                  TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
                  CONSENT OF THE COMPANY.

                  (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 shall be returned to
or retained and canceled by the Trustee in accordance with Section 2.12 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 shall take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive


                                       37


Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall 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 shall take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall 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.

                  (i) To permit registrations of transfers and exchanges, the
         Company shall execute and the Trustee shall authenticate Global Notes
         and Definitive Notes upon the Company's order or at the Registrar's
         request.

                  (ii) No service charge shall 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 2.11, 3.06, 3.08, 4.10, 4.14
         and 9.05 hereof).

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

                  (iv) All Global Notes and Definitive Notes issued upon any
         registration of transfer or exchange of Global Notes or Definitive
         Notes shall be the valid and legally binding 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.

                  (v) The Company shall not 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 so selected for redemption in whole
         or in part, except the unredeemed portion of any Note being redeemed in
         part or (C) to register the transfer of or to exchange a Note between a
         record date and the next succeeding Interest Payment Date (as defined
         in the Notes).

                  (vi) 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.

                  (vii) The Trustee shall authenticate Global Notes and
         Definitive Notes in accordance with the provisions of Section 2.02
         hereof.




                                       38


                  (viii) All certifications, certificates and Opinions of
         Counsel required to be submitted to the Registrar pursuant to this
         Section 2.07 to effect a registration of transfer or exchange may be
         submitted by facsimile with the original to follow by first class mail.

                  (ix) The Trustee shall have no obligation or duty to monitor,
         determine or inquire as to compliance with any restrictions on transfer
         imposed under this Indenture or under applicable law with respect to
         any transfer of any interest in any Note other than to require delivery
         of such certificates and other documentation or evidence as are
         expressly required by, and to do so if and when expressly required by
         the terms of, this Indenture, and to examine the same to determine
         substantial compliance as to form with the express requirements hereof.

Section 2.08 REPLACEMENT NOTES.

                  (a) 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 shall issue and the Trustee,
upon receipt of an Authentication Order, shall 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.

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

Section 2.09 OUTSTANDING NOTES.

                  (a) 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 as not outstanding. Except as set forth in Section 2.10 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 Company or a Subsidiary of
the Company shall not be deemed to be outstanding for purposes of Section
3.07(b) hereof.

                  (b) If a Note is replaced pursuant to Section 2.08 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.

                  (c) 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.

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



                                       39



Section 2.10 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 by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company, shall
be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.

Section 2.11 TEMPORARY NOTES.

                  (a) Until certificates representing Notes are ready for
delivery, the Company may prepare and the Trustee, upon receipt of an
Authentication Order, shall authenticate temporary Notes. Temporary Notes shall
be substantially in the form of certificated Notes but may have variations that
the Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall prepare
and the Trustee shall authenticate Definitive Notes in exchange for temporary
Notes.

                  (b) Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture.

Section 2.12 CANCELLATION.

                  The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
canceled Notes in accordance with its procedures for the disposition of canceled
securities in effect as of the date of such disposition (subject to the record
retention requirement of the Exchange Act). Certification of the disposition of
all canceled Notes shall 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 2.13 DEFAULTED INTEREST.

                  If the Company defaults in a payment of interest on the Notes,
it shall 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 shall 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 shall fix or cause to be fixed
each such special record date and payment date, PROVIDED that no such special
record date shall 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) shall 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.



                                       40



Section 2.14 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 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.

                                 ARTICLE THREE
                           REDEMPTION AND PREPAYMENT;
                           SATISFACTION AND DISCHARGE

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 shall furnish to the Trustee,
at least 30 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Notes to be redeemed and (iv) the redemption price.

Section 3.02 SELECTION OF NOTES TO BE REDEEMED.

                  (a) If less than all of the Notes are to be redeemed or
purchased in an offer to purchase at any time, the Trustee shall select the
Notes to be redeemed or purchased among the Holders of the Notes in compliance
with the requirements of the principal national securities exchange, if any, on
which the Notes are listed or, if the Notes are not so listed, on a PRO RATA
basis, by lot or in accordance with any other method the Trustee considers fair
and appropriate. In the event of partial redemption by lot, the particular Notes
to be redeemed shall be selected, unless otherwise provided herein, not less
than 30 nor more than 60 days prior to the redemption date by the Trustee from
the outstanding Notes not previously called for redemption.

                  (b) The Trustee shall promptly notify the Company in writing
of the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount at maturity thereof to be redeemed. No
Notes in amounts of $1,000 or less shall be redeemed in part. Notes and portions
of Notes selected shall 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, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.

Section 3.03 NOTICE OF REDEMPTION.

                  (a) Subject to the provisions of Section 3.08 hereof, at least
30 days but not more than 60 days before a redemption date, the Company shall



                                       41


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.

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

                  (i) the redemption date;

                  (ii) the redemption price;

                  (iii) if any Note is being redeemed in part, the portion of
         the principal amount at maturity 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 of the
         original Note shall be issued in the name of the Holder thereof upon
         cancellation of the original Note;

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

                  (v) that Notes called for redemption must be surrendered to
         the Paying Agent to collect the redemption price and become due on the
         date fixed for redemption;

                  (vi) 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;

                  (vii) the paragraph of the Notes and/or Section of this
         Indenture pursuant to which the Notes called for redemption are being
         redeemed; and

                  (viii) 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.

                  (b) At the Company's request, the Trustee shall give the
notice of redemption in the Company's name and at its expense; PROVIDED,
HOWEVER, that the Company shall have 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. The notice, if mailed in the
manner provided herein shall be presumed to have been given, whether or not the
Holder receives such notice.

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. A notice of redemption may not be
conditional.

Section 3.05 DEPOSIT OF REDEMPTION PRICE.

                  (a) One Business Day prior to the redemption date, the Company
shall deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued interest and Liquidated Damages, if any, on
all Notes to be redeemed on that date. The Trustee or the Paying Agent shall



                                       42


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 price of, and accrued interest on, all Notes to be redeemed.

                  (b) If the Company complies with the provisions of the
preceding paragraph, on and after the redemption date, interest shall cease to
accrue on the Notes or the portions of Notes called for redemption. If a Note is
redeemed 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 shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest shall be paid on the unpaid principal, from
the redemption 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 IN PART.

                  Upon surrender of a Note that is redeemed in part, the Company
shall issue and the Trustee shall authenticate for the Holder at the expense of
the Company a new Note equal in principal amount to the unredeemed portion of
the Note surrendered. No Notes in denominations of $1,000 or less shall be
redeemed in part.

Section 3.07 OPTIONAL REDEMPTION.

                  (a) Except as set forth in clause (b) of this Section 3.07,
the Company shall not have the option to redeem the Notes pursuant to this
Section 3.07 on or prior to July 15, 2008. Thereafter, the Company may redeem
all or a part of the Notes upon not less than 30 nor more than 60 days' notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest and Liquidated Damages, if any,
thereon, to the applicable redemption date, if redeemed during the twelve-month
period beginning on July 15 of the years indicated below:

                          YEAR                             PERCENTAGE
                          ----                             ----------
                          2008.........................    104.125%
                          2009 ........................    102.750%
                          2010 ........................    101.375%
                          2011 and thereafter .........    100.000%

                  (b) At any time on or prior to July 15, 2006, the Company may
on any one or more occasions redeem up to 35% of the aggregate principal amount
of Notes originally issued hereunder at a redemption price of 108.250% 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 Equity Offerings; PROVIDED that (A) at least 65% of the aggregate principal
amount of the Notes originally issued under this Indenture remains outstanding
immediately after the occurrence of such redemption, excluding Notes held by the
Company and its Subsidiaries; and (B) the redemption must occur within 90 days
of the date of the closing of such Equity Offering.



                                       43



                  (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 REPURCHASE OFFERS.

                  In the event that, pursuant to Sections 4.10 and 4.14 hereof,
the Company shall be required to commence an offer to all Holders to purchase
their respective Notes (a "REPURCHASE OFFER"), it shall follow the procedures
specified below.

                  The Repurchase Offer shall 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 shall purchase the principal amount of Notes
required to be purchased pursuant to Sections 4.10 and 4.14 hereof (the "OFFER
AMOUNT") or, if less than the Offer Amount has been tendered, all Notes tendered
in response to the Repurchase Offer. Payment for any Notes so purchased shall 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 shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Repurchase Offer.

                  Upon the commencement of a Repurchase Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders, with
a copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Repurchase
Offer. The Repurchase Offer shall be made to all Holders. The notice, which
shall govern the terms of the Repurchase Offer, shall state:

                  (i) that the Repurchase Offer is being made pursuant to this
         Section 3.08 and Section 4.10 or Section 4.14 hereof, and the length of
         time the Repurchase Offer shall remain open;

                  (ii) the Offer Amount, the purchase price and the Purchase
         Date;

                  (iii) that any Note not tendered or accepted for payment shall
         continue to accrete or accrue interest and Liquidated Damages, if any;

                  (iv) that, unless the Company defaults in making such payment,
         any Note (or portion thereof) accepted for payment pursuant to the
         Repurchase Offer shall cease to accrete or accrue interest and
         Liquidated Damages, if any, after the Purchase Date;

                  (v) that Holders electing to have a Note purchased pursuant to
         a Repurchase Offer may elect to have Notes purchased in integral
         multiples of $1,000 only;

                  (vi) that Holders electing to have a Note purchased pursuant
         to any Repurchase Offer shall be required to surrender the Note, with
         the form entitled "Option of Holder to Elect Purchase" on the reverse
         of the Note completed, or transfer by book-entry transfer, to the



                                       44


         Company, the 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;

                  (vii) that Holders shall 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;

                  (viii) that, if the aggregate amount of Notes surrendered by
         Holders exceeds the Offer Amount, the Trustee shall select the Notes to
         be purchased on a pro rata basis (with such adjustments as may be
         deemed appropriate by the Trustee so that only Notes in denominations
         of $1,000, or integral multiples thereof, shall be purchased); and

                  (ix) that Holders whose Notes were purchased only in part
         shall be issued new Notes equal in principal amount to the unpurchased
         portion of the Notes surrendered (or transferred by book-entry
         transfer).

                  On the Purchase Date, the Company shall, 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 Repurchase Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and
shall deliver to the Trustee 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 3.08. The Company, the Depositary or the Paying
Agent, as the case may be, shall 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 Notes tendered by such Holder, as the case may
be, and accepted by the Company for purchase, and the Company, shall promptly
issue a new Note. The Trustee, upon written request from the Company shall
authenticate and mail or deliver such new Note to such Holder, in a principal
amount at maturity 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
respective Holder thereof. The Company shall publicly announce the results of
the Repurchase Offer as soon as practicable after the Purchase Date.

                  The Company shall comply with the requirements of Rule 14e-1
under the Exchange Act, and any other securities laws and regulations thereunder
to the extent such laws or regulations are applicable in connection with the
repurchase of the Notes pursuant to an Asset Sale Offer.

                  Other than as specifically provided in this Section 3.08, any
purchase pursuant to this Section 3.08 shall be made pursuant to the provisions
of Sections 3.01 through 3.06 hereof.

Section 3.09 APPLICATION OF TRUST MONEY.

                  All money deposited with the Trustee pursuant to Section 10.02
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



                                       45


Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest for 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.

                                  ARTICLE FOUR
                                    COVENANTS

Section 4.01 PAYMENT OF NOTES.

                  (a) The Company shall pay or cause to be paid the principal
of, premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Company
or one of its Subsidiaries, holds as of 11:00 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 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.

                  (b) 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.

                  (a) The Company shall maintain in the Borough of Manhattan,
The City of New York, an office or agency (which may be an office of the Trustee
or an agent 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 shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.

                  (b) 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 Borough of Manhattan, The City of New York for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.



                                       46


                  (c) The Company hereby designates the Corporate Trust Office
of the Trustee as one such office or agency of the Company in accordance with
Section 2.04 of this Indenture.

Section 4.03 REPORTS.

                  (a) Whether or not required by the SEC, so long as any Notes
are outstanding, the Company shall furnish to the Holders of Notes, within the
time periods specified in the SEC's rules and regulations:

                  (i) all quarterly and annual financial information that would
         be required to be contained in a filing with the SEC on Forms 10-Q and
         10-K if the Company were required to file such Forms, including a
         "Management's Discussion and Analysis of Financial Condition and
         Results of Operations" and, with respect to the annual information
         only, a report on the annual financial statements by the Company's
         certified independent accountants; and

                  (ii) all current reports that would be required to be filed
         with the SEC on Form 8-K if the Company were required to file such
         reports.

                  (b) In addition, whether or not required by the SEC, the
Company shall file a copy of all of the information and reports referred to in
clauses (a)(i) and (ii) above with the SEC for public availability within the
time periods specified in the SEC's rules and regulations (unless the SEC will
not accept such a filing) and make such information available to securities
analysts and prospective investors upon request. In addition, the Company shall,
for so long as any Notes remain outstanding, 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, if any such information is required to be delivered.

                  (c) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding paragraph shall include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and in "Management's Discussion and Analysis of Financial Condition and
Results of Operations," of the financial condition and results of operations of
the Company and its Restricted Subsidiaries separate from the financial
condition and results of operations of the Unrestricted Subsidiaries of the
Company.

Section 4.04 COMPLIANCE CERTIFICATE.

                  (a) The Company shall and shall cause each Guarantor (to the
extent that such Guarantor is so required under the TIA) to 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 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 its obligations under this Indenture and is
not in default in the performance or observance of any of the terms, provisions



                                       47


and conditions of this Indenture (or, if a Default or Event of Default shall
have 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 not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
year-end financial statements delivered pursuant to Section 4.03(a) above shall
be accompanied by a written statement of the Company's independent public
accountants (which shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article Four or Article Five hereof or,
if any such violation has occurred, specifying the nature and period of
existence thereof, it being understood that such accountants shall not be liable
directly or indirectly to any Person for any failure to obtain knowledge of any
such violation.

                  (c) The Company shall, so long as any of the Notes are
outstanding, 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 its
Subsidiaries to pay, prior to delinquency, any 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 (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waive all benefit or advantage of any such law,
and covenant that they 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:

                  (i) 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 or consolidation involving the
         Company or any Restricted Subsidiary) or to the direct or indirect



                                       48


         holders of the Company's or any Restricted Subsidiary's 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);

                  (ii) purchase, redeem or otherwise acquire or retire for value
         (including, without limitation, in connection with any merger or
         consolidation involving the Company) any Equity Interests of the
         Company;

                  (iii) make any payment on or with respect to, or purchase,
         redeem, defease or otherwise acquire or retire for value any
         Indebtedness that is expressly subordinated to the Notes or any
         Guarantee, except a payment of interest or principal at the Stated
         Maturity thereof; or

                  (iv) make any Restricted Investment (all such payments and
         other actions set forth in clauses (i) through (iv) above being
         collectively referred to as "RESTRICTED PAYMENTS"),

         unless, at the time of and after giving effect to such Restricted
Payment:

                  (v) no Default or Event of Default shall have occurred and be
         continuing or would occur as a consequence of such Restricted Payment;
         and

                  (vi) the Company would, at the time of such Restricted Payment
         and after giving pro forma effect thereto as if such Restricted Payment
         had been made at the beginning of the applicable four-quarter period,
         have been permitted to incur at least $1.00 of additional Indebtedness
         pursuant to the Fixed Charge Coverage Ratio test set forth in Section
         4.09(a); and

                  (vii) such Restricted Payment, together with the aggregate
         amount of all other Restricted Payments made by the Company and its
         Restricted Subsidiaries after the date hereof (excluding Restricted
         Payments permitted by Section 4.07(b), (ii), (iii), (iv) and (v)), is
         less than the sum, without duplication, of:

                           (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 hereof 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) (i) 100% of the aggregate net cash proceeds plus
                  (ii) 70% of the aggregate fair market value of assets (other
                  than Restricted Investments), in each case, received by the
                  Company since the date hereof as a contribution to its common
                  equity capital or from the issue or sale of Equity Interests
                  of the Company (other than Disqualified Stock), except to the
                  extent used to make an Investment pursuant to clause (17) or
                  (15) of the definition of Permitted Investments, or from the
                  issue or sale of convertible or exchangeable Disqualified



                                       49


                  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) to the extent that any Restricted Investment that
                  was made after the date hereof is sold for cash or otherwise
                  liquidated or repaid for cash, the lesser of (i) the cash
                  return of capital with respect to such Restricted Investment
                  (less the cost of disposition, if any) and (ii) the initial
                  amount of such Restricted Investment; PLUS

                           (D) to the extent that any Unrestricted Subsidiary of
                  the Company is redesignated as a Restricted Subsidiary after
                  the date hereof, the lesser of (i) the fair market value of
                  the Company's Investment in such Subsidiary as of the date of
                  such redesignation or (ii) such fair market value as of the
                  date on which such Subsidiary was originally designated as an
                  Unrestricted Subsidiary, plus the amount of any Investments
                  made in such Subsidiary subsequent to such designation (and
                  treated as Restricted Payments) by the Company or any
                  Restricted Subsidiary; PLUS

                           (E) 100% of any other dividends or other
                  distributions received by the Company or a Restricted
                  Subsidiary of the Company since the date hereof from an
                  Unrestricted Subsidiary of the Company to the extent that such
                  dividends were not otherwise included in Consolidated Net
                  Income of the Company for such period in an amount not to
                  exceed the amount of Restricted Investments previously made by
                  the Company and its Restricted Subsidiaries in such
                  Unrestricted Subsidiary; PLUS

                           (F) $5.0 million.

                  (b) So long as no Default has occurred and is continuing or
would be caused thereby, the preceding provisions will not prohibit:

                  (i) the payment of any dividend within 60 days after the date
         of declaration of the dividend, if at the date of declaration the
         dividend payment would have complied with the provisions of this
         Indenture;

                  (ii) the redemption, repurchase, retirement, defeasance or
         other acquisition of any subordinated Indebtedness of the Company or
         any Guarantor or of any Equity Interests of the Company in exchange
         for, or out of the net cash proceeds of the substantially concurrent
         sale (other than to a Subsidiary of the Company) of, Equity Interests
         of the Company (other than Disqualified Stock); PROVIDED that the
         amount of any such net cash proceeds that are utilized for any such
         redemption, repurchase, retirement, defeasance or other acquisition
         will be excluded from Section 4.07(a)(vii)(B);




                                       50


                  (iii) the defeasance, redemption, repurchase or other
         acquisition of subordinated Indebtedness of the Company or any
         Guarantor with the net cash proceeds from an incurrence of Permitted
         Refinancing Indebtedness;

                  (iv) the payment of any dividend by a Restricted Subsidiary of
         the Company to the holders of its Equity Interests on a pro rata basis;

                  (v) repurchases of Equity Interests of the Company deemed to
         occur upon the exercise of stock options if such Equity Interests
         represent a portion of the exercise price thereof;

                  (vi) the repurchase, redemption or other acquisition or
         retirement for value of Equity Interests of the Company or any
         Restricted Subsidiary of the Company held by any member of the
         Company's (or any of its Restricted Subsidiaries') management; PROVIDED
         that the aggregate amount expended pursuant to this clause (vi) shall
         not exceed $1.0 million in any twelve-month period;

                  (vii) cash payments, in lieu of fractional shares issuable as
         dividends on Equity Interests of the Company in an amount, when taken
         together with all other cash payments made pursuant to this clause
         (vii) since the date hereof, not to exceed $500,000; and

                  (viii) Restricted Payments not otherwise permitted in an
         amount not to exceed $5.0 million.

                  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
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 with respect thereto shall be delivered to the Trustee. Except with
respect to a Restricted Payment permitted by Section 4.07(b) above, the Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if the
fair market value exceeds $10.0 million. Not later than the date on which such
Restricted Payment was made, the Company shall deliver to the Trustee an
Officers' Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by this Section
4.07 were computed, together with a copy of any fairness opinion or appraisal
required by this Indenture.

Section 4.08 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED
             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 consensual restriction of any
kind on the ability of any Restricted Subsidiary to:

                  (i) pay dividends or make any other distributions on its
         Capital Stock to the Company or any of its Restricted Subsidiaries, or




                                       51


         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;

                  (ii) make loans or advances to the Company or any of its
         Restricted Subsidiaries; or

                  (iii) transfer any of its properties or assets to the Company
         or any of its Restricted Subsidiaries.

                  (b) However, the restrictions set forth in Section 4.08(a)
will not apply to encumbrances or restrictions existing under or by reason of:

                  (i) agreements governing Existing Indebtedness and the Credit
         Facilities as in effect on the date hereof 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 hereof;

                  (ii) this Indenture, the Notes and the Exchange Notes;

                  (iii) applicable law;

                  (iv) 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;

                  (v) customary non-assignment provisions of any contract or
         agreement entered into in the ordinary course of business and customary
         provisions restricting subletting of any interest in real or personal
         property contained in any lease or easement agreement of the Company or
         any Restricted Subsidiary;

                  (vi) purchase money obligations for property acquired in the
         ordinary course of business that impose restrictions on that property
         of the nature described in Section 4.08(a)(iii);

                  (vii) any agreement for the sale or other disposition of all
         or substantially all of the assets or Capital Stock of a Restricted
         Subsidiary that restricts distributions by that Restricted Subsidiary
         pending its sale or other disposition of all or substantially all of
         the assets or Capital Stock of such Restricted Subsidiary;



                                       52



                  (viii) Permitted Refinancing Indebtedness; PROVIDED that the
         restrictions contained in the agreements governing such Permitted
         Refinancing Indebtedness with respect to dividends and other payments
         are not materially more restrictive, taken as a whole, than those
         contained in the agreements governing the Indebtedness being
         refinanced;

                  (ix) Liens securing Indebtedness otherwise permitted to be
         incurred under Section 4.12 that limit the right of the debtor to
         dispose of the assets subject to such Liens;

                  (x) provisions with respect to the disposition or distribution
         of assets or property in joint venture agreements entered into in the
         ordinary course of business;

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

                  (xii) any Indebtedness incurred in compliance with the Section
         4.09 by any Foreign Subsidiary or any Guarantor, or any agreement
         pursuant to which such Indebtedness is issued, if the encumbrance or
         restriction applies only to such Foreign Subsidiary or Guarantor and
         only in the event of a payment default or default with respect to a
         financial covenant contained in the Indebtedness or agreement and the
         encumbrance or restriction is not materially more disadvantageous to
         the Holders of the Notes than is customary in comparable financings (as
         determined by the Board of Directors of the Company) and the Board of
         Directors of the Company determines that any such encumbrance or
         restriction will not materially affect the Company's ability to pay
         interest or principal on the Notes; or

                  (xiii) an arrangement or circumstance arising or agreed to in
         the ordinary course of business, not relating to any Indebtedness, and
         that does not, individually or in the aggregate, detract from the value
         of property or assets of the Company or any Restricted Subsidiary in
         any manner material to the Company or any Restricted Subsidiary.

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 will not issue any
Disqualified Stock and will not permit any of its Restricted Subsidiaries to
issue any Disqualified Stock or preferred stock; PROVIDED, HOWEVER, that the
Company may incur Indebtedness (including Acquired Debt) or issue Disqualified
Stock, and any Guarantor may incur Indebtedness or issue Disqualified Stock (and
WCC RE Holdings LLC and Atlantic Shores Healthcare, Inc. may guarantee
Indebtedness of the Company under the Credit Agreement) and any Foreign
Subsidiary may incur Indebtedness, 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




                                       53


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) So long as no Default shall have occurred and be
continuing or would be caused thereby, Section 4.09(a) will not prohibit the
incurrence of any of the following items of Indebtedness or the issuance of
Disqualified Stock, as set forth below (collectively, "PERMITTED DEBT"):

                  (i) the incurrence by the Company and any of its Restricted
         Subsidiaries of Indebtedness under the Credit Agreement in an aggregate
         principal amount at any one time outstanding under this clause
         4.09(b)(i) not to exceed $150.0 million, LESS the aggregate amount of
         all Net Proceeds of Asset Sales applied by the Company or any
         Restricted Subsidiary to repay any Indebtedness under the Credit
         Agreement and, if the Indebtedness repaid is revolving credit
         Indebtedness, to correspondingly reduce commitments with respect
         thereto, pursuant to Section 4.10;

                  (ii) the incurrence by the Company and any of its Restricted
         Subsidiaries of Existing Indebtedness;

                  (iii) the incurrence by the Company of Indebtedness
         represented by the Notes to be issued on the date hereof and any
         Guarantees thereof by any Guarantor;

                  (iv) the incurrence by the Company or any Restricted
         Subsidiary 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 4.09(b)(iv), not to
         exceed $10.0 million at any time outstanding;

                  (v) 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 (ii),
         (iii), (v), or (xi) of this Section 4.09(b);

                  (vi) 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; and



                                       54



                           (B) (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 4.09(b)(vi);

                  (vii) the incurrence by the Company or any of its Restricted
         Subsidiaries of Hedging Obligations that are incurred for the purpose
         of fixing or hedging interest rate risk with respect to any
         Indebtedness that is permitted by the terms of this Indenture to be
         outstanding or for hedging foreign currency exchange risk, in each case
         to the extent the Hedging Obligations are incurred in the ordinary
         course of business and not for any speculative purpose;

                  (viii) the Guarantee by the Company or any Guarantor of
         Indebtedness of the Company or a Restricted Subsidiary of the Company
         that was permitted to be incurred by another provision of this Section
         4.09;

                  (ix) 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, 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 Section 4.09; PROVIDED, in each such case, that the
         amount thereof is included in Fixed Charges of the Company as accrued;

                  (x) the incurrence by the Company or any of its Restricted
         Subsidiaries of Indebtedness, including Indebtedness represented by
         letters of credit for the account of the Company or any Restricted
         Subsidiary, incurred in respect of workers' compensation claims,
         self-insurance obligations, performance, proposal, completion, surety
         and similar bonds and completion guarantees provided by the Company or
         any of its Restricted Subsidiaries in the ordinary course of business;
         PROVIDED that the underlying obligation to perform is that of the
         Company or its Restricted Subsidiaries and not that of the Company's
         Unrestricted Subsidiaries; PROVIDED FURTHER that such underlying
         obligation is not in respect of borrowed money;

                  (xi) the incurrence by the Company or any of the Restricted
         Subsidiaries of additional 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
         (xi), not to exceed $30.0 million;

                  (xii) the incurrence by the Company or any of its Restricted
         Subsidiaries of Indebtedness, including but not limited to Indebtedness
         represented by letters of credit for the account of the Company or any
         Restricted Subsidiary, arising from agreements of the Company or a



                                       55



         Restricted Subsidiary providing for indemnification, adjustment of
         purchase price or similar obligations, in each case, incurred or
         assumed in connection with the disposition of any business, assets or
         Equity Interests of the Company or a Restricted Subsidiary, other than
         guarantees of Indebtedness incurred by any Person acquiring all or any
         portion of such business, assets or Equity Interests for the purpose of
         financing such acquisition;

                  (xiii) the incurrence by the Company or any Restricted
         Subsidiary of Indebtedness arising from the honoring by a bank or other
         financial institution of a check, draft or similar instrument (except
         in the case of daylight overdrafts) drawn against insufficient funds in
         the ordinary course of business, PROVIDED that such Indebtedness is
         extinguished within five Business Days of incurrence; or

                  (xiv) the issuance of preferred stock of a Restricted
         Subsidiary to the Company that is pledged to secure the Credit
         Agreement, PROVIDED that any subsequent transfer that results in such
         preferred stock being held by a Person other than the Company or a
         Restricted Subsidiary will be deemed to constitute an issuance of
         preferred stock not permitted by this clause (xiv).

                  (c) For purposes of determining compliance with any
restriction on the incurrence of Indebtedness where the Indebtedness incurred is
not denominated in U.S. dollars, the amount of such Indebtedness will be the
U.S. Dollar Equivalent determined on the date of incurrence of such
Indebtedness; PROVIDED, HOWEVER, that if any such Indebtedness not denominated
in U.S. dollars is subject to a Hedging Obligation 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 Hedging Obligation. 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 refinanced,
except to the extent that (i) such U.S. Dollar Equivalent was determined based
on a Hedging Obligation, in which case the Permitted Refinancing Indebtedness
will be determined in accordance with the preceding sentence, and (ii) 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 will be determined on the date such Permitted
Refinancing Indebtedness is Incurred.

                  (d) 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 (i)
through (xiv) of Section 4.09(b), or is entitled to be incurred pursuant to
Section 4.09(a), the Company will be permitted to 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 the Credit Agreement outstanding on the date on which
Notes are first issued and authenticated under this Indenture will be deemed to
have been incurred on such date in reliance on the exception provided in Section
4.09(b)(i).

                  (e) The Company shall not, and shall not permit any Guarantor,
to incur any Indebtedness (including Permitted Debt) that is contractually
subordinated in right of payment to any other Indebtedness of the Company or
such Guarantor unless such Indebtedness is also contractually subordinated in




                                       56


right of payment to the Notes or such Guarantee 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.

Section 4.10 ASSET SALES.

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

                  (i) 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;

                  (ii) the fair market value, in the case of any Asset Sales or
         series of related Asset Sales having a fair market value of $5.0
         million or more, is determined by the Company's Board of Directors and
         evidenced by a resolution of Board of Directors set forth in an
         Officers' Certificate delivered to the Trustee; and

                  (iii) at least 75% of the consideration received in the Asset
         Sale by the Company or such Restricted Subsidiary is in the form of
         cash or Cash Equivalents. For purposes of this Section 4.10(a)(iii)
         only, each of the following will be deemed to be cash:

                           (A) any liabilities, as shown on the Company's or
                  such Restricted Subsidiary's most recent balance sheet, of the
                  Company or any Restricted Subsidiary (other than contingent
                  liabilities and Indebtedness (other than Indebtedness secured
                  by the assets sold) that is equal in right of payment with or
                  subordinated to the Notes or any Guarantee) that are assumed
                  by the transferee of any such assets pursuant to a customary
                  novation 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 into cash or Cash Equivalents within 30
                  days after the applicable Asset Sale, to the extent of the
                  cash or Cash Equivalents received in that conversion.

                  (b) Within 360 days after the receipt of any Net Proceeds from
an Asset Sale or from the sale of the Company's interest in Premier Custodial
Group Limited to Serco Investments Limited, the Company or the applicable
Restricted Subsidiary may apply those Net Proceeds, at its option:

                  (i) to repay permanently Indebtedness under the Credit
         Agreement (and with respect to Net Proceeds of a Restricted Subsidiary
         that is not a Guarantor, Indebtedness of such Restricted Subsidiary)
         and, if the Indebtedness permanently repaid is revolving credit
         Indebtedness, to correspondingly reduce commitments with respect
         thereto;



                                       57


                  (ii) to acquire, or enter into a definitive agreement to
         acquire, all or substantially all of the assets of, a Permitted
         Business or a majority of the Voting Stock of a Person employed in a
         Permitted Business, PROVIDED that such Person becomes a Restricted
         Subsidiary and PROVIDED FURTHER, however, in the case of a definitive
         agreement, that such acquisition closes within 120 days of such 360 day
         period;

                  (iii) to make a capital expenditure in or that is used or
         useful in a Permitted Business (provided that the completion of (a)
         construction of new facilities, (b) expansions to existing facilities
         and (c) repair or construction of damaged or destroyed facilities, in
         each case, which commences within such 360 days may extend for an
         additional 360 day period if the Net Proceeds to be used for such
         construction, expansion or repair are committed specifically for such
         activity within such 360 days); or

                  (iv) to acquire other long-term assets that are used or useful
         in a Permitted Business.

                  Pending the final application of any Net Proceeds, the Company
may temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by this Indenture.

                  (c) Any Net Proceeds from Asset Sales (or from the sale of the
Company's interest in Premier Custodial Group Limited to Serco Investments
Limited) 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 shall make an offer (an "ASSET SALE OFFER")
to all Holders of Notes and, at the Company's option, all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to
those set forth in this Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets, to purchase on a pro rata basis the
maximum principal amount of Notes and such other pari passu Indebtedness 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, 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 and other pari passu Indebtedness 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. Upon completion of each Asset Sale Offer, the
amount of Excess Proceeds will be reset at zero.

                  (d) 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 Section 4.10 by virtue of such conflict.



                                       58



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:

                  (i) such 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

                  (ii) 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 of the
                  Company; and

                           (B) except with respect to leases of facilities
                  entered into in the ordinary course of business with a Wholly
                  Owned Subsidiary, with respect to any Affiliate Transaction or
                  series of related Affiliate Transactions involving aggregate
                  consideration in excess of $10.0 million, an opinion as to the
                  fairness to the Company of such Affiliate Transaction from a
                  financial point of view issued by an accounting, appraisal or
                  investment banking firm of national standing.

                  (b) The following items shall be deemed not to be Affiliate
Transactions and, therefore, will not be subject to the provisions of Section
4.11(a):

                  (i) indemnity agreements and reasonable employment
         arrangements (including severance and retirement agreements) entered
         into by the Company or any of its Restricted Subsidiaries in the
         ordinary course of business of the Company or such Restricted
         Subsidiary, in each case approved by the disinterested members of the
         Board of Directors of the Company;

                  (ii) transactions between or among the Company and/or its
         Restricted Subsidiaries;

                  (iii) payment of reasonable directors fees to Persons who are
         not otherwise Affiliates of the Company;

                  (iv) sales of Equity Interests (other than Disqualified Stock)
         of the Company;

                  (v) Restricted Payments that are permitted by Section 4.07;
         and




                                       59


                  (vi) any issuance of securities, or other payments, awards or
         grants in cash, securities or otherwise pursuant to, or the funding of
         employment arrangements, stock options and stock ownership plans and
         other reasonable fees, compensation, benefits and indemnities paid or
         entered into by the Company or any of its Restricted Subsidiaries in
         the ordinary course of business to or with officers, directors or
         employees of the Company and its Restricted Subsidiaries.

Section 4.12 LIENS.

                  The Company shall not and shall not permit any of its
Restricted Subsidiaries to, create, incur, assume or otherwise cause or suffer
to exist or become effective any Lien of any kind (other than Permitted Liens)
upon any of their property or assets, now owned or hereafter acquired, unless
all payments due under this Indenture and the Notes are secured on an equal and
ratable basis with the Obligations so secured until such time as such
Obligations are no longer secured by a Lien.

Section 4.13 BUSINESS ACTIVITIES.

                  The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any business other than Permitted Businesses, except to
such extent as would not be material to the Company and its Restricted
Subsidiaries takes as a whole.

Section 4.14 OFFER TO REPURCHASE UPON A CHANGE OF CONTROL.

                  (a) Upon the occurrence of a Change of Control, each Holder of
Notes shall have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described below (the "CHANGE OF CONTROL OFFER") at an
offer price in cash equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest and Liquidated Damages thereon, if any, to the date
of purchase (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 offering
to repurchase Notes on the 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 described
in Section 3.08 and described in such notice. 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 such
Change of Control Offer, the Company shall comply with the applicable securities
laws and regulations and shall be deemed not to have breached its obligations
under Section 4.14 by virtue of such conflict.

                  (b) On the Change of Control Payment Date, the Company shall,
to the extent lawful, (1) accept for payment all Notes or portions thereof
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 thereof so properly tendered and (3) deliver or cause to be




                                       60


delivered to the Trustee the Notes properly accepted together with an Officers'
Certificate stating the aggregate principal amount of Notes or portions thereof
being purchased by the Company. The Paying Agent shall promptly deliver 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 each such
new Note shall be in a principal amount of $1,000 or an integral multiple
thereof. 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
4.14, the Company shall not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Section 4.14 and all other provisions of this Indenture applicable to a
Change of Control Offer made by the Company and purchases all Notes properly
tendered and not withdrawn under such Change of Control Offer.

Section 4.15 LIMITATION ON ISSUANCES AND SALES OF EQUITY INTERESTS IN
             RESTRICTED SUBSIDIARIES.

                  The Company shall not transfer, convey, sell, assign, lease or
otherwise dispose of, and shall not permit any of its Restricted Subsidiaries
to, issue, transfer, convey, sell, assign, lease or otherwise dispose of any
Equity Interests in any Restricted Subsidiary of the Company to any Person
(other than the Company or a Wholly Owned Restricted Subsidiary of the Company),
except:

                  (1) if, immediately after giving effect to such issuance,
         transfer, conveyance, sale, assignment, lease or other disposition,
         such Restricted Subsidiary would no longer constitute a Restricted
         Subsidiary and any Investment in such Person remaining after giving
         effect to such issuance or sale would have been permitted to be made
         under Section 4.07, if made on the date of such issuance or sale; or

                  (2) sales of common stock of a Restricted Subsidiary by the
         Company or a Restricted Subsidiary, PROVIDED that the Company or such
         Restricted Subsidiary complies with Section 4.10.

Section 4.16 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 or Event of Default. 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 shall be deemed to be Investments made as of
the time of the designation, subject to the limitations on Restricted Payments.
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 of the Company may redesignate



                                       61


any Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation
would not cause a Default; PROVIDED that such designation shall 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
shall only be permitted if (1) such Indebtedness is permitted under Section
4.09, 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 or Event of
Default would be in existence following such designation.

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 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 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:

                  (i) 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
         the Fixed Charge Coverage Ratio test in Section 4.09(a) hereof and (b)
         incurred a Lien to secure such Indebtedness pursuant to Section 4.12;

                  (ii) 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 of the Company and set forth in
         an Officers' Certificate delivered to the Trustee, of the property that
         is the subject of that Sale and Leaseback Transaction; and

                  (iii) the transfer of assets in that Sale and Leaseback
         Transaction is permitted by, and the Company applies the proceeds of
         such transaction in compliance with Section 4.10 hereof.

Section 4.19 ADDITIONAL NOTE GUARANTEES.

                  The Company shall not permit any of its Restricted
Subsidiaries which are not Guarantors (other than Guarantees by WCC RE Holdings
LLC and Atlantic Shores Healthcare, Inc. of Indebtedness incurred under the
Credit Agreement), directly or indirectly, to Guarantee the payment of any
Indebtedness of the Company or any Guarantor unless such Restricted Subsidiary
simultaneously executes and delivers (i) a supplemental indenture, in the form
of Exhibit F attached hereto, providing for the Guarantee of the payment of the
Notes by such Restricted Subsidiary, which Guarantee shall be senior to or PARI
PASSU with such Subsidiary's Guarantee of such other Indebtedness and (ii) a
notation of Guarantee in the form of Exhibit E attached hereto.



                                       62



                                  ARTICLE FIVE
                                   SUCCESSORS

Section 5.01 MERGER, CONSOLIDATION OR SALE OF ASSETS.

                  (a) The Company shall not, in a single transaction or a series
of related transactions, consolidate with or merge with or into any other Person
or sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets to any Person or group of
affiliated Persons, or permit any of its Restricted Subsidiaries to enter into
any such transaction or transactions if such transaction or transactions, in the
aggregate, would result in an assignment, conveyance, transfer, lease or
disposition of all or substantially all of the properties and assets of the
Company and its Restricted Subsidiaries taken as a whole to any other Person or
group of affiliated Persons, unless at the time and after giving effect thereto:

                  (i) 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, lease,
         transfer, conveyance or other disposition has been made is a
         corporation organized or existing under the laws of the United States,
         any state of the United States or the District of Columbia;

                  (ii) the Person formed by or surviving any such consolidation
         or merger (if other than the Company) or the Person to which such sale,
         assignment, lease, transfer, conveyance or other disposition has been
         made assumes all the obligations of the Company under the Notes, this
         Indenture and the Registration Rights Agreement pursuant to agreements
         reasonably satisfactory to the Trustee;

                  (iii) no Default or Event of Default exists;

                  (iv) the Company or the other Person formed by or surviving
         any such consolidation or merger (if other than the Company), or to
         which such sale, assignment, lease, transfer, conveyance or other
         disposition has been made will, 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, be permitted to incur at least $1.00 of additional
         Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth
         in Section 4.09(a) hereof; and

                  (v) the Company or the other Person formed by or surviving any
         such consolidation or merger (if other than the Company), or to which
         such sale, assignment, lease, transfer, conveyance or other disposition
         has been made will have delivered to the Trustee, in form and substance
         reasonably satisfactory to the Trustee, an Officers' Certificate and an
         Opinion of Counsel, each stating that such consolidation, merger, sale,
         assignment, lease, conveyance, transfer, or other disposition, and if a
         supplemental indenture is required in connection with such transaction,
         such supplemental indenture, comply with the requirements of this
         Indenture and that all conditions precedent therein provided for
         relating to such transaction have been complied with.

                  (b) Clause (iv) of this Section 5.01 will not apply to: (a) a
sale, transfer or other disposition of assets between or among the Company and



                                       63


any of its Wholly Owned Restricted Subsidiaries or (b) any merger or
consolidation of a Wholly Owned Restricted Subsidiary into the Company.

                                  ARTICLE SIX
                              DEFAULTS AND REMEDIES

Section 6.01 EVENTS OF DEFAULT.

                  (a) Each of the following is an "EVENT OF DEFAULT":

                  (i) default for 30 days in the payment when due of interest
         on, or Liquidated Damages with respect to, the Notes;

                  (ii) default in payment when due of the principal of, or
         premium, if any, on the Notes;

                  (iii) failure by the Company or any of its Restricted
         Subsidiaries, to comply with the provisions described in Sections 4.10,
         4.14 or 5.01 hereof;

                  (iv) failure by the Company or any Guarantor for 60
         consecutive days after notice to comply with any of the other
         agreements in this Indenture;

                  (v) 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
         hereof, if that default:

                           (A) is caused by a failure to make any payment when
                  due at the final maturity of such Indebtedness (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 $7.5 million or more;

                  (vi) failure by the Company or any of its Restricted
         Subsidiaries to pay final judgments aggregating in excess of $7.5
         million, which judgments are not paid, discharged or stayed for a
         period of 60 days;

                  (vii) except as permitted by this 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 or any
         Guarantor, or any Person acting on behalf of any Guarantor, shall deny
         or disaffirm its obligations under its Guarantee;




                                       64


                  (viii) the Company or any Restricted Subsidiary that is a
         Significant Subsidiary or any group of Restricted Subsidiaries that,
         taken together, would constitute a Significant Subsidiary, pursuant to
         or within the meaning of Bankruptcy Law:

                           (1) commences a voluntary case,

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

                           (3) makes a general assignment for the benefit of its
                  creditors, or

                           (4) generally is not paying its debts as they become
                  due; and

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

                           (A) is for relief against the Company or any
                  Restricted Subsidiary that is a Significant Subsidiary or any
                  group of Restricted Subsidiaries that, taken together, would
                  constitute a Significant Subsidiary, in an involuntary case;
                  or

                           (B) appoints a custodian of the Company or any
                  Restricted Subsidiary that is a Significant Subsidiary or any
                  group of Restricted Subsidiaries that, taken together, would
                  constitute a Significant Subsidiary or for all or
                  substantially all of the property of the Company or any
                  Restricted Subsidiary that is a Significant Subsidiary or any
                  group of Restricted Subsidiaries that taken together, would
                  constitute a Significant Subsidiary, or

                           (C) orders the liquidation of the Company or any
                  Restricted Subsidiary that is a Significant Subsidiary or any
                  group of Restricted Subsidiaries that, taken together, would
                  constitute a Significant Subsidiary.

Section 6.02 ACCELERATION.

                  (a) In the case of an Event of Default specified in clause
(viii) or (ix) of Section 6.01 hereof, with respect to the Company or any
Restricted Subsidiary that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together, would constitute a Significant
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 principal amount of
the then outstanding Notes may declare all the Notes to be due and payable
immediately by notice in writing to the Company specifying the Event of Default.

                  (b) In the event of a declaration of acceleration of the Notes
because an Event of Default has occurred and is continuing as a result of the
acceleration of any Indebtedness described in clause (v) of Section 6.01(a)
hereof, the declaration of acceleration of the Notes shall be automatically
annulled if the holders of any Indebtedness described in clause (v) of Section
6.01(a) hereof have rescinded the declaration of acceleration in respect of the
Indebtedness within 30 days of the date of the declaration and if:




                                       65


                  (i) the annulment of the acceleration of Notes would not
         conflict with any judgment or decree of a court of competent
         jurisdiction; and

                  (ii) all existing Events of Default, except nonpayment of
         principal or interest on the Notes that became due solely because of
         the acceleration of the Notes, have been cured or waived.

Section 6.03 OTHER REMEDIES.

                  (a) If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy to collect the payment of principal,
premium, if any, interest, and Liquidated Damages, if any, with respect to, the
Notes or to enforce the performance of any provision of the Notes or this
Indenture.

                  (b) 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 a majority in principal amount of the then
outstanding Notes by notice to the Trustee, may on behalf of the Holders of all
of the Notes, waive any existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of interest or Liquidated Damages, if any, on, or the principal of, the
Notes (including in connection with an offer to purchase) (PROVIDED, HOWEVER,
that the Holders of a majority in principal amount of the then outstanding Notes
may rescind an acceleration and its consequences, including any related payment
default that resulted from such acceleration). The Company shall deliver to the
Trustee an Officers' Certificate stating that the requisite percentage of
Holders have consented to such waiver and attaching copies of such consents. In
case of any such waiver, the Company, the Trustee and the Holders shall be
restored to their former positions and rights hereunder and under the Notes,
respectively. This Section 6.04 shall be in lieu of Section 316(a)(1)(B) of the
TIA and such Section 316(a)(1)(B) of the TIA is hereby expressly excluded from
this Indenture and the Notes, as permitted by the TIA. 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 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 and the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction.. 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.



                                       66


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 Liquidated Damages, if any) if it
determines that withholding notice is in their interest.

Section 6.06 LIMITATION ON SUITS.

                  (a) A Holder may pursue a remedy with respect to this
Indenture, or the Notes only if:

                  (i) the Holder gives to the Trustee written notice of a
         continuing Event of Default;

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

                  (iii) such Holder of a Note or Holders of Notes offer and, if
         requested, provide to the Trustee security and indemnity satisfactory
         to the Trustee against any loss, liability or expense that might be
         incurred by it in connection with the request or direction;

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

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

                  (b) 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, if any,
interest on, and Liquidated Damages, if any, with respect to, 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.

Section 6.08 COLLECTION SUIT BY TRUSTEE.

                  If an Event of Default specified in Section 6.01(a)(i) or
(a)(ii) 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, if any, interest, and Liquidated Damages,
if any, remaining unpaid on the Notes and interest on overdue principal and
premium, if any, and, to the extent lawful, interest and Liquidated Damages, if
any, 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.




                                       67


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 Guarantor (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 securities or 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 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.

                  (a) If the Trustee collects any money pursuant to this
Article, 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,
         expense 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, if any, interest and Liquidated Damages,
         if any, ratably, without preference or priority of any kind, according
         to the amounts due and payable on the Notes for principal, premium, if
         any, interest, and Liquidated Damages, if any, respectively; and

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

                  (b) The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this Section 6.10.




                                       68


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 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 ten percent in principal amount of the then outstanding Notes.

                                 ARTICLE SEVEN
                                     TRUSTEE

Section 7.01 DUTIES OF TRUSTEE.

                  (a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in 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:

                  (i) the duties of the Trustee shall 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 Indenture and
         no others, and no implied covenants or obligations shall be read into
         this Indenture against the Trustee; and

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

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

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

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

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




                                       69


                  (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 shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have offered
to the Trustee security and indemnity satisfactory to it against any loss,
costs, liability or expense that might be incurred by it in connection with the
request or direction.

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

Section 7.02 CERTAIN RIGHTS OF TRUSTEE.

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

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

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

                  (d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.

                  (e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.

                  (f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee security or indemnity satisfactory to it against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.

                  (g) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the Trustee has
actual knowledge thereof or unless written notice of such event is sent to the
Trustee in accordance with Section 11.02 hereof, and such notice references the
Notes.



                                       70


                  (h) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and to each officer, director and employee of the
Trustee.

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

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 become a creditor of, or otherwise deal
with, the Company or any of its Affiliates with the same rights it would have if
it were not Trustee. However, in the event that the Trustee acquires any
conflicting interest as described in the Trust Indenture Act of 1939, it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue as trustee or resign. Any Agent may do the same with like rights and
duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.

Section 7.04 TRUSTEE'S DISCLAIMER.

                  The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than 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 shall 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
and 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 1 beginning with the May 1
following the date hereof, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA ss. 313(a) (but if no event described in
TIA ss. 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).



                                       71



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

Section 7.07 COMPENSATION AND INDEMNITY.

                  (a) The Company shall pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder in accordance with a written schedule provided by the Trustee to the
Company. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.

                  (b) The Company shall 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 reasonable costs and expenses of enforcing this
Indenture against the Company (including this Section 7.07) and defending itself
against any claim (whether asserted by either of the Company or 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 willful
misconduct. The Trustee shall notify the Company promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so notify the Company shall not
relieve the Company of its obligations hereunder. The Company shall defend the
claim and the Trustee shall cooperate in the defense. The Trustee may have
separate counsel and the Company shall pay the reasonable fees and expenses of
such counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld.

                  (c) The obligations of the Company under this Section 7.07
shall survive the satisfaction and discharge of this Indenture and resignation
of removal of the Trustee.

                  (d) To secure the Company's payment obligations in this
Section, the Trustee shall have a Lien prior to the Notes on all money or
property held or collected by the Trustee, except that held in trust to pay
principal and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture and resignation or removal of the
Trustee.

                  (e) When the Trustee incurs expenses or renders services after
an Event of Default specified in Section 6.01(a)(viii) and (ix) 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 shall comply with the provisions of
TIAss.313(b)(2) to the extent applicable.




                                       72


Section 7.08 REPLACEMENT OF TRUSTEE.

                  (a) A resignation or removal of the Trustee and appointment of
a successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 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 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 if:

                  (i) the Trustee fails to comply with Section 7.10 hereof;

                  (ii) 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;

                  (iii) a custodian or public officer takes charge of the
         Trustee or its property; or

                  (iv) 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 shall promptly
appoint a successor Trustee. Within one year after the successor Trustee takes
office, the Holders of a majority in principal amount of the 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 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition at the expense of the Company 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,
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 shall deliver a written acceptance of
its appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, PROVIDED all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08 or Section 7.09, the Company's obligations under Section 7.07 hereof shall
continue for the benefit of the retiring Trustee.




                                       73


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
Person, the successor Person without any further act shall be the successor
Trustee.

Section 7.10 ELIGIBILITY; DISQUALIFICATION.

                  There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof 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 shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).

Section 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

                  The Trustee is subject to TIA ss. 311(a), excluding any
creditor relationship listed in TIA ss. 311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
The Trustee hereby waives any right to set-off any claim that it may have
against the Company in any capacity (other than as Trustee and Paying Agent)
against any of the assets of the Company held by the Trustee; PROVIDED, HOWEVER,
that if the Trustee is or becomes a lender of any other Indebtedness permitted
hereunder to be PARI PASSU with the Notes, then such waiver shall not apply to
the extent of such Indebtedness.

Section 7.12 TRUSTEE'S APPLICATION FOR INSTRUCTIONS FROM THE COMPANY.

                  Any application by the Trustee for written instructions from
the Company may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
five (5) Business Days after the date any Officer of the Company actually
receives such application, unless any such Officer shall have consented in
writing to any earlier date) unless prior to taking any such action (or the
effective date in the case of an omission), the Trustee shall have received
written instructions in response to such application specifying the action to be
taken or omitted.

                                 ARTICLE EIGHT
                       DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.

                  The Company may, at the option of the Board of Directors
evidenced by a resolution set forth in an Officers' Certificate, at any time,



                                       74


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 Eight.

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 shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to
have been discharged from its obligations with respect to all outstanding Notes
and all obligations of the Guarantors shall be deemed to have been discharged
with respect to their obligations under the 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 shall
be deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes and Guarantees, respectively, which shall 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 (a) and (b) below, and to have
satisfied all its other obligations under such Notes and this Indenture (and the
Trustee, on reasonable demand of and at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the following
provisions which shall survive until otherwise terminated or discharged
hereunder: (a) the rights of Holders of outstanding Notes to receive solely from
the trust fund described in Section 8.04 hereof, and as more fully set forth in
such Section, payments in respect of the principal of, premium, if any, interest
and Liquidated Damages, if any, on such Notes when such payments are due, (b)
the Company's obligations with respect to such Notes under Article 2 concerning
issuing temporary Notes, registration of Notes and mutilated, destroyed, lost or
stolen Notes and Company's obligations under Section 4.02 hereof, (c) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and the
Company's obligations in connection therewith and (d) 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 shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be released
from its obligations under the covenants contained in Sections 4.07, 4.08, 4.09,
4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18 and 4.19 hereof and clause
(iv) of Section 5.01(a) hereof with respect to the outstanding Notes on and
after the date the conditions set forth in Section 8.04 are satisfied
(hereinafter, "COVENANT DEFEASANCE"), and the Notes shall thereafter be deemed
not "outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes, the Company may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or



                                       75


by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01 hereof, but, except as specified
above, the remainder of this Indenture and such Notes shall be unaffected
thereby. In addition, upon the Company's exercise under Section 8.01 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(a)(iii) through (vii)
shall not constitute Events of Default.

Section 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.

                  (a) The following shall be the conditions to the application
of either Section 8.02 or 8.03 hereof to the outstanding Notes:

                  (i) 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 and, if the
         Notes are being defeased to a particular redemption date, the Company
         must have delivered to the Trustee an irrevocable notice of redemption;

                  (ii) in the case of Legal Defeasance, the Company shall have
         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 hereof, 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;

                  (iii) in the case of Covenant Defeasance, the Company shall
         have 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;

                  (iv) no Default or Event of Default has occurred and is
         continuing either (a) on the date of such deposit or (b) insofar as
         Events of Default from bankruptcy or insolvency events are concerned,
         at any time in the period ending on the 123rd day after the date of
         deposit;

                  (v) 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;



                                       76



                  (vi) the Company must have delivered 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 or with the intent of defeating,
         hindering, delaying or defrauding creditors of the Company or others;

                  (vii) the Company must have delivered to the Trustee an
         Opinion of Counsel to the effect that the creation of the defeasance
         trust does not violate the Investment Company Act of 1940 and after the
         passage of 123 days following the deposit, the trust fund will not be
         subject to the effect of Section 547 of the U.S. Bankruptcy Code or
         Section 15 of the New York Debtor and Creditor Law; and

                  (viii) 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.

                  (a) Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (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.

                  (b) The Company shall 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.

                  (c) Anything in this Article Eight to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon the request of the Company any money or 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(a) 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 THE 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,
if any, or interest on any Note and remaining unclaimed for two years after such
principal, and premium, 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) shall be
discharged from such trust; and the Holder of such Note shall thereafter look



                                       77


only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as Trustee thereof, shall thereupon cease; PROVIDED, 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 date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining shall be repaid to the Company.

Section 8.07 REINSTATEMENT.

                  If the Trustee or Paying Agent is unable to apply any United
States 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 obligations under this
Indenture and the Notes shall 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, if any, or interest on any Note
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Notes to receive such payment from the
money held by the Trustee or Paying Agent.

                                  ARTICLE NINE
                        AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES.

                  (a) Notwithstanding Section 9.02 of this Indenture, the
Company, the Guarantors, if any, and the Trustee may amend or supplement this
Indenture or the Notes without the consent of any Holder of a Note:

                  (i) to cure any ambiguity, defect or inconsistency;

                  (ii) to provide for uncertificated Notes in addition to or in
         place of certificated Notes;

                  (iii) 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 or
         such Guarantor's assets;

                  (iv) 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;

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



                                       78


                  (vi) to allow any Subsidiary to guarantee the Notes.

                  (b) 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 shall join with the
Company in the execution of any amended or supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee shall
not be obligated to enter into such amended or supplemental indenture that
affects its own rights, duties or immunities under this Indenture or otherwise.

Section 9.02 WITH CONSENT OF HOLDERS OF NOTES.

                  (a) Except as provided in Section 9.02(c), the Company, the
Guarantors, if any, and the Trustee may amend or supplement this Indenture or
the Notes with the consent of the Holders of at least a majority in principal
amount of the Notes (including Additional Notes, if any) then outstanding
(including, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, Notes), and, subject to Sections 6.04
and 6.07 hereof, any existing Default or Event of Default or compliance with any
provision of this Indenture or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes
(including Additional Notes, if any) (including, without limitation, consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Notes).

                  (b) The Company may, but shall not be obligated to, fix a
record date for the purpose of determining the Persons entitled to consent to
any indenture supplemental hereto. If a record date is fixed, the Holders on
such record date, or its duly designated proxies, and only such Persons, shall
be entitled to consent to such supplemental indenture, whether or not such
Holders remain Holders after such record date; PROVIDED that unless such consent
shall have become effective by virtue of the requisite percentage having been
obtained prior to the date which is 90 days after such record date, any such
consent previously given shall automatically and without further action by any
Holder be cancelled and of no further effect.

                  (c) 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 shall join with the Company 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 this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such amended or supplemental indenture.

                  (d) It shall 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 or waiver, but it shall be sufficient if such consent approves the
substance thereof.



                                       79


                  (e) After an amendment, supplement or waiver under this
Section becomes effective, the Company shall mail to the Holders of Notes
affected thereby a notice briefly describing the amendment, supplement or
waiver. Any failure of the Company to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such amended
or supplemental indenture or waiver. Subject to Sections 6.04 and 6.07 hereof,
the Holders of a majority in aggregate principal amount of the then outstanding
Notes (including Additional Notes, if any) may waive compliance in a particular
instance by the Company with any provision of this Indenture, or the Notes.
However, without the consent of each Holder affected, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):

                  (i) reduce the principal amount of Notes whose Holders must
         consent to an amendment, supplement or waiver;

                  (ii) reduce the principal of or change the fixed maturity of
         any Note or alter the provisions, or waive any payment, with respect to
         the redemption of the Notes;

                  (iii) reduce the rate of or change the time for payment of
         interest on any Note;

                  (iv) waive a Default or Event of 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);

                  (v) make any Note payable in money other than U.S. dollars;

                  (vi) 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;

                  (vii) waive a redemption payment with respect to any Note;

                  (viii) release any Guarantor from any of its obligations under
         its Guarantee or this Indenture, except in accordance with the terms of
         this Indenture;

                  (ix) impair the right to institute suit for the enforcement of
         any payment on or with respect to the Notes or the Guarantees;

                  (x) amend, change or modify the obligation of the Company to
         make and consummate an Asset Sale Offer with respect to any Asset Sale
         in accordance with Section 4.10 hereof after the obligation to make an
         Asset Sale Offer has arisen or the obligation of the Company to make
         and consummate a Change of Control Offer in the event of a Change of
         Control in accordance with Section 4.14 hereof after a Change of
         Control has occurred, including, in each case, amending, changing or
         modifying any definition relating thereto;

                  (xi) make any change in the preceding amendment and waiver
         provisions.




                                       80


Section 9.03 COMPLIANCE WITH TRUST INDENTURE ACT.

                  Every amendment or supplement to this Indenture or the Notes
shall be set forth in an amended or supplemental indenture that complies with
the TIA as then in effect.

Section 9.04 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 waiver, supplement or amendment 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.

                  (a) 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.

                  (b) Failure to make the appropriate notation or issue a new
Note shall not affect the validity and effect of such amendment, supplement or
waiver.

Section 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC.

                  The Trustee shall sign any amended or supplemental indenture
or Note authorized pursuant to this Article Nine if the amendment or supplement
does not adversely affect the rights, duties, liabilities or immunities of the
Trustee. The Company may not sign an amendment or supplemental indenture or Note
until its Board of Directors approves it. In executing any amended or
supplemental indenture or Note, the Trustee shall be entitled to receive and
(subject to Section 7.01 hereof) shall be fully protected in relying upon 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 and that all conditions precedent to such execution have been met.

                                  ARTICLE TEN
                           SATISFACTION AND DISCHARGE

Section 10.01 SATISFACTION AND DISCHARGE.

                  (a) This Indenture shall be discharged and shall cease to be
of further effect as to all Notes issued thereunder, when:

                  (i) either:



                                       81


                           (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 theretofore 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 making 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 thereof, in such
                  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;

                  (ii) no Default or Event of Default shall have occurred and be
         continuing on the date of such deposit or shall occur as a result of
         such deposit and such 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;

                  (iii) the Company or any Guarantor has paid or caused to be
         paid all sums payable by it hereunder; and

                  (iv) the Company has delivered irrevocable instructions to the
         Trustee hereunder to apply the deposited money toward the payment of
         the Notes at maturity or the redemption date, as the case may be.

                  (b) 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.

Section 10.02 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
              OTHER MISCELLANEOUS PROVISIONS.

                  Subject to Section 10.03 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee pursuant to Section 10.01 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (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 be segregated from other funds except to the
extent required by law.



                                       82


Section 10.03 REPAYMENT TO THE 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
and Liquidated Damages, if any, or interest on any Note and remaining unclaimed
for two years after such principal, and premium, 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) shall be discharged from such trust; and the Holder of such Note
shall thereafter look only to the Company for payment thereof, and all liability
of the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as Trustee thereof, shall thereupon cease; PROVIDED,
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 or The Wall Street Journal (national edition),
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such notification
or publication, any unclaimed balance of such money then remaining shall be
repaid to the Company.

                                 ARTICLE ELEVEN
                                  MISCELLANEOUS

Section 11.01 TRUST INDENTURE ACT CONTROLS.

                  If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA ss. 318(c), the imposed duties shall
control.

Section 11.02 NOTICES.

                  (a) Any notice or communication by the Company or any
Guarantor, on the one hand, or the Trustee on the other hand, to the other is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telecopier or overnight air
courier guaranteeing next day delivery, to the others' address:

                  If to the Company:

                  Wackenhut Corrections Corporation
                  One Park Place
                  621 NW 53rd Street
                  Suite 700
                  Boca Raton, Florida 33487
                  Facsimile:  (561) 999-7742
                  Attention:  John G. O'Rourke




                                       83


                  With a copy to:

                  Akerman Senterfitt
                  One Southeast Third Avenue
                  28th Floor
                  Miami, Florida 33131-1714
                  Facsimile:  (305) 374-5095
                  Attention:  Stephen K. Roddenberry

                  If to the Trustee:

                  The Bank of New York
                  101 Barclay Street, 8W
                  New York, New York 10286
                  Facsimile:  (212) 815-5704
                  Attention:  Corporate Finance Unit, Ref: Wackenhut
                              Corrections Corp.

                  (b) The Company the Guarantors if any, or the Trustee, by
notice to the others may designate additional or different addresses for
subsequent notices or communications.

                  (c) All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.

                  (d) Any notice or communication to a Holder shall 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 shall also be so
mailed to any Person described in TIA ss. 313(c), to the extent required by the
TIA. Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders.

                  (e) 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. Notwithstanding the foregoing, notices to the Trustee
shall be deemed to be effective only when actually received by the Trustee's
Corporate Trust Department.

                  (f) If the Company mails a notice or communication to Holders,
it shall mail a copy to the Trustee and each Agent at the same time.

Section 11.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.

                  Holders may communicate pursuant to TIA ss. 312(b) with other
Holders with respect to its rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss. 312(c).




                                       84


Section 11.04 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:

                  (i) an Officers' Certificate in form and substance reasonably
         satisfactory to the Trustee (which shall include the statements set
         forth in Section 11.05 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

                  (ii) an Opinion of Counsel in form and substance reasonably
         satisfactory to the Trustee (which shall include the statements set
         forth in Section 11.05 hereof) stating that, in the opinion of such
         counsel (who may rely upon the Officer's Certificate as to matters of
         fact), all such conditions precedent and covenants have been satisfied.

Section 11.05 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 ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:

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

                  (ii) 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;

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

                  (iv) a statement as to whether or not, in the opinion of such
         Person, such condition or covenant has been satisfied.

Section 11.06 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 11.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES
              AND STOCKHOLDERS.

                  No director, officer, employee, incorporator or stockholder of
the Company or any Guarantor, as such, shall have any liability for any
obligations of the Company or the Guarantors under the Notes, this Indenture,
the Note Guarantees 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



                                       85


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.

Section 11.08 GOVERNING LAW.

                  THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Section 11.09 CONSENT TO JURISDICTION.

                  Any legal suit, action or proceeding arising out of or based
upon this Indenture or the transactions contemplated hereby ("RELATED
PROCEEDINGS") may be instituted in the federal courts of the United States of
America located in the City of New York or the courts of the State of New York
in each case located in the City of New York (collectively, the "SPECIFIED
COURTS"), and each party irrevocably submits to the exclusive jurisdiction
(except for proceedings instituted in regard to the enforcement of a judgment of
any such court (a "RELATED JUDGMENT"), as to which such jurisdiction is
non-exclusive) of such courts in any such suit, action or proceeding. Service of
any process, summons, notice or document by mail to such party's (other than the
Trustee) address set forth above shall be effective service of process for any
suit, action or other proceeding brought in any such court. The parties
irrevocably and unconditionally waive any objection to the laying of venue of
any suit, action or other proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any such court has been
brought in an inconvenient forum.

Section 11.10 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 any of its Subsidiaries or
of any other Person. Any such indenture, loan or debt agreement may not be used
to interpret this Indenture.

Section 11.11 SUCCESSORS.

                  All agreements of the Company in this Indenture and the Notes
shall bind its successors. All agreements of the Trustee in this Indenture shall
bind its successors. All agreements of each Guarantor in this Indenture shall
bind its successors.

Section 11.12 SEVERABILITY.

                  In case any provision in this Indenture or the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

Section 11.13 COUNTERPART ORIGINALS.

                  The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.





                                       86


Section 11.14 ACTS OF HOLDERS.

                  (a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by the Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agents duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "ACT" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and conclusive in favor of the Trustee and the Company if made in the
manner provided in this Section 11.14.

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

                  (c) Notwithstanding anything to the contrary contained in this
Section 11.14, the principal amount and serial numbers of Notes held by any
Holder, and the date of holding the same, shall be proved by the register of the
Notes maintained by the Registrar as provided in Section 2.04 hereof.

                  (d) If the Company shall solicit from the Holders of the Notes
any request, demand, authorization, direction, notice, consent, waiver or other
Act, the Company may, at its option, by or pursuant to a resolution of its Board
of Directors, fix in advance a record date for the determination of Holders
entitled to give such request, demand, authorization, direction, notice,
consent, waiver or other Act, but the Company shall have no obligation to do so.
Notwithstanding TIA ss. 316(c), such record date shall be the record date
specified in or pursuant to such resolution, which shall be a date not earlier
than the date 30 days prior to the first solicitation of Holders generally in
connection therewith or the date of the most recent list of Holders forwarded to
the Trustee prior to such solicitation pursuant to Section 2.06 hereof and not
later than the date such solicitation is completed. If such a record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act may be given before or after such record date, but only the Holders
of record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of the then outstanding Notes have authorized or agreed or consented
to such request, demand, authorization, direction, notice, consent, waiver or
other Act, and for that purpose the then outstanding Notes shall be computed as
of such record date; PROVIDED that no such authorization, agreement or consent



                                       87


by the Holders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than 90
days after the record date.

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

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

Section 11.15 BENEFIT OF INDENTURE.

                  Nothing, in this Indenture or in the Notes, express or
implied, shall give to any Person, other than the parties hereto, any Paying
Agent, any Registrar and its successors hereunder, and the Holders, any benefit
or any legal or equitable right, remedy or claim under this Indenture.

Section 11.16 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 shall
in no way modify or restrict any of the terms or provisions hereof.

Section 11.17 WAIVER OF JURY TRIAL.

                  EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE
NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.


                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


                                       88




                                   SIGNATURES







                                            WACKENHUT CORRECTIONS CORPORATION



                                            By: /s/ John G. O'Rourke
                                                ------------------------------
                                            Name:  John G. O'Rourke
                                            Title: Chief Financial Officer-
                                                   Senior Vice President




                                       89



                                            THE BANK OF NEW YORK, as Trustee



                                            By: /s/ Mary LaGumina
                                                ------------------------------
                                            Name:  Mary LaGumina
                                            Title: Vice President

                                       90

                               [EXHIBIT OMITTED]

EX-4.2

                                                                     EXHIBIT 4.2


                          REGISTRATION RIGHTS AGREEMENT

                                  BY AND AMONG

                        WACKENHUT CORRECTIONS CORPORATION

                                       AND

                          BNP PARIBAS SECURITIES CORP.
                              LEHMAN BROTHERS INC.
                      FIRST ANALYSIS SECURITIES CORPORATION
                           SOUTHTRUST SECURITIES, INC.
                            COMERICA SECURITIES, INC.





                            DATED AS OF JULY 9, 2003











                          REGISTRATION RIGHTS AGREEMENT

                  This Registration Rights Agreement (this "AGREEMENT") is made
and entered into as of July 9, 2003, by and among Wackenhut Corrections
Corporation, a Florida corporation (the "COMPANY"), and the Initial Purchasers
set forth in Schedule I to the Purchase Agreement (as defined below) (each an
"INITIAL PURCHASER" and, collectively, the "INITIAL PURCHASERS"), each of whom
has agreed to purchase the Company's 8 1/4% Senior Notes due 2013 (the "INITIAL
NOTES") pursuant to the Purchase Agreement (as defined below).

                  This Agreement is made pursuant to the Purchase Agreement,
dated as of July 1, 2003 (the "PURCHASE AGREEMENT"), by and among the Company
and the Initial Purchasers (i) for the benefit of the Initial Purchasers and
(ii) for the benefit of the holders from time to time of the Initial Notes
(including you and each other Initial Purchaser named in the Purchase
Agreement). In order to induce the Initial Purchasers to purchase the Initial
Notes, the Company has agreed to provide the registration rights set forth in
this Agreement. The execution and delivery of this Agreement is a condition to
the obligations of the Initial Purchasers set forth in Section 3(a) of the
Purchase Agreement.

                  The parties hereby agree as follows:

                  SECTION 1. DEFINITIONS

                  As used in this Agreement, the following capitalized terms
shall have the following meanings:

                  ADVICE: As defined in Section 6(c) hereof.

                  BROKER-DEALER: Any broker or dealer registered under the
         Exchange Act.

                  CLOSING DATE: The date of this Agreement.

                  COMMISSION: The Securities and Exchange Commission.

                  CONSUMMATE: A registered Exchange Offer shall be deemed
         "Consummated" for purposes of this Agreement upon the occurrence of all
         of the following (i) the filing and effectiveness under the Securities
         Act of the Exchange Offer Registration Statement relating to the
         Exchange Notes to be issued in the Exchange Offer, (ii) the maintenance
         of such Registration Statement continuously effective and the keeping
         of the Exchange Offer open for a period not less than the minimum
         period required pursuant to Section 3(b) hereof, and (iii) the delivery
         by the Company to the Registrar under the Indenture of Exchange Notes
         in the same aggregate principal amount as the aggregate principal
         amount of Initial Notes that were tendered by Holders thereof pursuant
         to the Exchange Offer.

                  EFFECTIVENESS TARGET DATE: As defined in Section 5 hereof.

                  EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.



                                       1


                  EXCHANGE NOTES: The 8 1/4% Senior Notes due 2013, of the same
         series under the Indenture as tHE Initial Notes, to be issued to
         Holders in exchange for Transfer Restricted Notes pursuant to this
         Agreement.

                  EXCHANGE OFFER: The registration by the Company under the
         Securities Act of the Exchange Notes pursuant to a Registration
         Statement pursuant to which the Company offers the Holders of all
         outstanding Transfer Restricted Notes the opportunity to exchange all
         such outstanding Transfer Restricted Notes held by such Holders for
         Exchange Notes in an aggregate principal amount equal to the aggregate
         principal amount of the Transfer Restricted Notes tendered in such
         exchange offer by such Holders.

                  EXCHANGE OFFER REGISTRATION STATEMENT: The Registration
         Statement relating to the Exchange Offer, including the related
         Prospectus.

                  GUARANTOR: Each Person that becomes a Guarantor of the Notes
         in accordance with the terms of the Indenture.

                  HOLDERS: As defined in Section 2(b) hereof.

                  INDEMNIFIED HOLDER: As defined in Section 8(a) hereof.

                  INDENTURE: The Indenture, dated as of July 9, 2003, between
         the Company and The Bank of New York, as trustee (the "TRUSTEE"),
         pursuant to which the Notes are to be issued, as such Indenture is
         amended or supplemented from time to time in accordance with the terms
         thereof.

                  INITIAL NOTES: The 8 1/4% Senior Notes due 2013, of the same
         series under the Indenture as the Exchange Notes, for so long as such
         securities constitute Transfer Restricted Notes.

                  INITIAL PLACEMENT: The issuance and sale by the Company of the
         Initial Notes to the Initial Purchasers pursuant to the Purchase
         Agreement.

                  INITIAL PURCHASERS: As defined in the preamble hereto.

                  INTEREST PAYMENT DATE: As defined in the Indenture and the
Notes.

                  LIQUIDATED DAMAGES: As defined in Section 5 hereof.

                  NASD: The National Association of Securities Dealers, Inc.

                  NOTES: The Initial Notes and the Exchange Notes.

                  PERSON: An individual, partnership, corporation, trust or
         unincorporated organization, or a government or agency or political
         subdivision thereof.




                                       2


                  PROSPECTUS: The prospectus included in a Registration
         Statement, as amended or supplemented by any prospectus supplement and
         by all other amendments thereto, including post-effective amendments,
         and all material incorporated by reference into such Prospectus.

                  REGISTRATION DEFAULT: As defined in Section 5 hereof.

                  REGISTRATION STATEMENT: Any registration statement of the
         Company relating to (a) an offering of Exchange Notes pursuant to an
         Exchange Offer or (b) the registration for resale of Transfer
         Restricted Notes pursuant to the Shelf Registration Statement, which is
         filed pursuant to the provisions of this Agreement, in each case,
         including the Prospectus included therein, all amendments and
         supplements thereto (including post-effective amendments) and all
         exhibits and material incorporated by reference therein.

                  SECURITIES ACT: The Securities Act of 1933, as amended.

                  SHELF FILING DEADLINE: As defined in Section 4 hereof.

                  SHELF REGISTRATION STATEMENT: As defined in Section 4 hereof.

                  TRANSFER RESTRICTED NOTE: Each Note, until the earliest to
         occur of (a) the date on which such Note is exchanged in the Exchange
         Offer and entitled to be resold to the public by the Holder thereof
         without complying with the prospectus delivery requirements of the
         Securities Act, (b) the date on which such Note has been effectively
         registered under the Securities Act and disposed of in accordance with
         a Shelf Registration Statement and (c) the date on which such Note is
         distributed to the public pursuant to Rule 144 under the Securities Act
         or by a Broker-Dealer pursuant to the "Plan of Distribution"
         contemplated by the Exchange Offer Registration Statement (including
         delivery of the Prospectus contained therein).

                  TRUST INDENTURE ACT: The Trust Indenture Act of 1939 (15
         U.S.C. Sections 77aaa to 77bbbb) as in effect on the date of the
         Indenture.

                  UNDERWRITTEN REGISTRATION or UNDERWRITTEN OFFERING: A
         registration in which securities of the Company are sold to an
         underwriter for reoffering to the public.

                  SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT

                  (a) TRANSFER RESTRICTED NOTES. The notes entitled to the
benefits of this Agreement are the Transfer Restricted Notes.

                  (b) HOLDERS OF TRANSFER RESTRICTED NOTES. A Person is deemed
to be a holder of Transfer Restricted Notes (each, a "HOLDER") whenever such
Person owns Transfer Restricted Notes.




                                       3


                  SECTION 3. REGISTERED EXCHANGE OFFER

                  (a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company shall (i) cause to be filed
with the Commission as soon as practicable after the Closing Date, but in no
event later than 75 days after the Closing Date, a Registration Statement under
the Securities Act relating to the Exchange Notes and the Exchange Offer, (ii)
use its best efforts to cause such Registration Statement to become effective at
the earliest possible time, but in no event later than 180 days after the
Closing Date, (iii) in connection with the foregoing, file (A) all pre-effective
amendments to such Registration Statement as may be necessary in order to cause
such Registration Statement to become effective and (B) if applicable, a
post-effective amendment to such Registration Statement pursuant to Rule 430A
under the Securities Act, (iv) cause all necessary filings in connection with
the registration and qualification of the Exchange Notes to be made under the
Blue Sky laws of such jurisdictions as are necessary to permit Consummation of
the Exchange Offer, and (v) upon the effectiveness of such Registration
Statement, commence the Exchange Offer. The Exchange Offer Registration
Statement shall be on the appropriate form permitting registration of the
Exchange Notes to be offered in exchange for the Transfer Restricted Notes and
to permit resales of Notes held by Broker-Dealers as contemplated by Section
3(c) below.

                  (b) The Company shall cause the Exchange Offer Registration
Statement to be effective continuously and shall keep the Exchange Offer open
for a period of not less than the minimum period required under applicable
federal and state securities laws to Consummate the Exchange Offer; PROVIDED,
HOWEVER, that in no event shall such period be less than 20 business days after
the date notice of the Exchange Offer is mailed to the Holders. The Company
shall cause the Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Notes shall be included in the
Exchange Offer Registration Statement. The Company shall use its best efforts to
cause the Exchange Offer to be Consummated on the earliest practicable date
after the Exchange Offer Registration Statement has become effective, but in no
event later than 30 days after the Exchange Offer Registration Statement has
become effective.

                  (c) The Company shall indicate in a "Plan of Distribution"
section contained in the Prospectus forming a part of the Exchange Offer
Registration Statement that any Broker-Dealer who holds Initial Notes that are
Transfer Restricted Notes and that were acquired for its own account as a result
of market-making activities or other trading activities (other than Transfer
Restricted Notes acquired directly from the Company), may exchange such Initial
Notes pursuant to the Exchange Offer; however, such Broker-Dealer may be deemed
to be an "underwriter" within the meaning of the Securities Act and must,
therefore, deliver a prospectus meeting the requirements of the Securities Act
in connection with any resales of the Exchange Notes received by such
Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may
be satisfied by the delivery by such Broker-Dealer of the Prospectus contained
in the Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such resales by
Broker-Dealers that the Commission may require in order to permit such resales



                                       4


pursuant thereto, but such "Plan of Distribution" shall not name any such
Broker-Dealer or disclose the amount of Notes held by any such Broker-Dealer
except to the extent required by the Commission as a result of a change in
policy after the date of this Agreement.

                  The Company shall use its best efforts to keep the Exchange
Offer Registration Statement continuously effective, supplemented and amended as
required by the provisions of Section 6(c) below to the extent necessary to
ensure that it is available for resales of Notes acquired by Broker-Dealers for
their own accounts as a result of market-making activities or other trading
activities, and to ensure that it conforms with the requirements of this
Agreement, the Securities Act and the policies, rules and regulations of the
Commission as announced from time to time, for a period ending on the earlier of
(i) 180 days from the date on which the Exchange Offer Registration Statement is
declared effective and (ii) the date on which a Broker-Dealer is no longer
required to deliver a prospectus in connection with market-making or other
trading activities.

                  The Company shall provide sufficient copies of the latest
version of such Prospectus to Broker-Dealers promptly upon request at any time
during such 180-day (or shorter as provided in the foregoing sentence) period in
order to facilitate such resales.

                  SECTION 4. SHELF REGISTRATION

                  (a) SHELF REGISTRATION. If (i) the Company is not required to
file an Exchange Offer Registration Statement or to consummate the Exchange
Offer because the Exchange Offer is not permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a) below have
been complied with), or (ii) any Holder of Transfer Restricted Notes notifies
the Company in writing prior to the 20th day following the consummation of the
Exchange Offer that (A) such Holder is prohibited by applicable law or
Commission policy from participating in the Exchange Offer, or (B) such Holder
may not resell the Exchange Notes acquired by it in the Exchange Offer to the
public without delivering a prospectus and that the Prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales by such Holder, or (C) such Holder is a Broker-Dealer and holds Initial
Notes acquired directly from the Company or one of its affiliates, then, upon
such Holder's request, the Company shall:

                  (x) cause to be filed a shelf registration statement pursuant
         to Rule 415 under the Securities Act, which may be an amendment to the
         Exchange Offer Registration Statement (in either event, the "SHELF
         REGISTRATION STATEMENT") as promptly as practicable (such date being
         the "SHELF FILING DEADLINE"), which Shelf Registration Statement shall
         provide for resales of all Transfer Restricted Notes the Holders of
         which shall have provided the information required pursuant to Section
         4(b) hereof; and

                  (y) use its best efforts to cause such Shelf Registration
         Statement to be declared effective by the Commission on or before the
         75th day after the Shelf Filing Deadline.

The Company shall use its best efforts to keep such Shelf Registration Statement
continuously effective, supplemented and amended as required by the provisions
of Sections 6(b) and (c) hereof to the extent necessary to ensure that it is
available for resales of Notes by the Holders of Transfer Restricted Notes
entitled to the benefit of this Section 4(a), and to ensure that it conforms



                                       5


with the requirements of this Agreement, the Securities Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of at least two years following the effective date of such Shelf
Registration Statement (or shorter period that will terminate when all the Notes
covered by such Shelf Registration Statement have been sold pursuant to such
Shelf Registration Statement).

                  (b) PROVISION BY HOLDERS OF CERTAIN INFORMATION IN CONNECTION
WITH THE SHELF REGISTRATION STATEMENT. No Holder of Transfer Restricted Notes
may include any of its Transfer Restricted Notes in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 10 business days after receipt of a request
therefor, such information as the Company may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
prospectus included therein. Each Holder as to which any Shelf Registration
Statement is being effected agrees to furnish promptly to the Company all
information required to be disclosed in order to make the information previously
furnished to the Company by such Holder not materially misleading.

                  SECTION 5. LIQUIDATED DAMAGES

                  If (i) any of the Registration Statements required by this
Agreement is not filed with the Commission on or prior to the date specified for
such filing in this Agreement, (ii) any of such Registration Statements has not
been declared effective by the Commission on or prior to the date specified for
such effectiveness in this Agreement (the "EFFECTIVENESS TARGET DATE"), (iii)
the Exchange Offer has not been Consummated within 30 business days after the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or (iv) any Registration Statement required by this Agreement is filed
and declared effective but shall thereafter cease to be effective or fail to be
usable for its intended purpose without being succeeded immediately by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (i) through (iv), a "REGISTRATION DEFAULT"), the Company hereby
agrees to pay to each Holder of the Transfer Restricted Notes affected thereby
Liquidated Damages in an amount equal to one quarter of one percent (0.25%) per
annum on principal amounts of the Transfer Restricted Notes held by such Holder
during the 90-day period immediately following the occurrence of any
Registration Default and shall increase by an additional one quarter of one
percent (0.25%) per annum on the principal amounts of such Transfer Restricted
Notes at the end of each subsequent 90-day period, but in no event shall such
increase exceed 2.00% per annum (any such interest assessed upon the occurrence
of Registration Default is referred to as "LIQUIDATED DAMAGES"). Following the
cure of all Registration Defaults relating to any particular Transfer Restricted
Notes, the Liquidated Damages payable with respect to the Transfer Restricted
Notes as a result of the provisions of this paragraph shall cease.

                  All obligations of the Company set forth in the preceding
paragraph that are outstanding with respect to any Transfer Restricted Note at
the time such security ceases to be a Transfer Restricted Note shall survive
until such time as all such obligations with respect to such Notes shall have
been satisfied in full.




                                       6


                  SECTION 6. REGISTRATION PROCEDURES

                  (a) EXCHANGE OFFER REGISTRATION STATEMENT. In connection with
the Exchange Offer, the Company shall comply with all of the provisions of
Section 6(c) below, shall use its best efforts to effect such exchange to permit
the sale of Transfer Restricted Notes being sold in accordance with the intended
method or methods of distribution thereof, and shall comply with all of the
following provisions:

                  (i) If in the reasonable opinion of counsel to the Company
         there is a question as to whether the Exchange Offer is permitted by
         applicable law, the Company hereby agrees to seek a no-action letter or
         other favorable decision from the Commission allowing the Company to
         Consummate an Exchange Offer for such Initial Notes. The Company hereby
         agrees to pursue the issuance of such a decision to the Commission
         staff level but shall not be required to take commercially unreasonable
         action to effect a change of Commission policy. The Company hereby
         agrees, however, to (A) participate in telephonic conferences with the
         Commission, (B) deliver to the Commission staff an analysis prepared by
         counsel to the Company setting forth the legal bases, if any, upon
         which such counsel has concluded that such an Exchange Offer should be
         permitted and (C) diligently pursue a favorable resolution by the
         Commission staff of such submission.

                  (ii) As a condition to its participation in the Exchange Offer
         pursuant to the terms of this Agreement, each Holder of Transfer
         Restricted Notes shall furnish, upon the request of the Company, prior
         to the Consummation thereof, a written representation to the Company
         (which may be contained in the letter of transmittal contemplated by
         the Exchange Offer Registration Statement) to the effect that (A) it is
         not an affiliate of the Company, (B) it is not engaged in, and does not
         intend to engage in, and has no arrangement or understanding with any
         person to participate in, a distribution of the Exchange Notes to be
         issued in the Exchange Offer and (C) it is acquiring the Exchange Notes
         in its ordinary course of business. In addition, all such Holders of
         Transfer Restricted Notes shall otherwise cooperate in the Company's
         preparations for the Exchange Offer. Each Holder hereby acknowledges
         and agrees that any Broker-Dealer and any such Holder using the
         Exchange Offer to participate in a distribution of the securities to be
         acquired in the Exchange Offer (1) could not under Commission policy as
         in effect on the date of this Agreement rely on the position of the
         Commission enunciated in MORGAN STANLEY AND CO., INC. (available June
         5, 1991) and EXXON CAPITAL HOLDINGS CORPORATION (available May 13,
         1988), as interpreted in the Commission's letter to Shearman & Sterling
         dated July 2, 1993, and similar no-action letters (which may include
         any no-action letter obtained pursuant to clause (i) above), and (2)
         must comply with the registration and prospectus delivery requirements
         of the Securities Act in connection with a secondary resale transaction
         and that such a secondary resale transaction should be covered by an
         effective registration statement containing the selling security holder
         information required by Item 507 or 508, as applicable, of Regulation
         S-K if the resales are of Exchange Notes obtained by such Holder in
         exchange for Initial Notes acquired by such Holder directly from the
         Company.

                  (b) SHELF REGISTRATION STATEMENT. In connection with the Shelf
Registration Statement, the Company shall comply with all the provisions of
Section 6(c) below and shall use its best efforts to effect such registration to
permit the sale of the Transfer Restricted Notes being sold in accordance with
the intended method or methods of distribution thereof, and pursuant thereto the



                                       7


Company will as expeditiously as possible prepare and file with the Commission a
Registration Statement relating to the registration on any appropriate form
under the Securities Act, which form shall be available for the sale of the
Transfer Restricted Notes in accordance with the intended method or methods of
distribution thereof.

                  (c) GENERAL PROVISIONS. In connection with any Registration
Statement and any Prospectus required by this Agreement to permit the sale or
resale of Transfer Restricted Notes (including, without limitation, any
Registration Statement and the related Prospectus required to permit resales of
Securities by Broker-Dealers), the Company shall:

                  (i) use its best efforts to keep such Registration Statement
         continuously effective and provide all requisite financial statements
         (including, if required by the Securities Act or any regulations
         thereunder, financial statements of the Guarantors, if any) for the
         period specified in Section 3 or 4 of this Agreement, as applicable;
         upon the occurrence of any event that would cause any such Registration
         Statement or the Prospectus contained therein (A) to contain a material
         misstatement or omission or (B) not to be effective and usable for
         resale of Transfer Restricted Notes during the period required by this
         Agreement, the Company shall file promptly an appropriate amendment to
         such Registration Statement, in the case of clause (A), correcting any
         such misstatement or omission, and, in the case of either clause (A) or
         (B), use its best efforts to cause such amendment to be declared
         effective and such Registration Statement and the related Prospectus to
         become usable for their intended purpose(s) as soon as practicable
         thereafter;

                  (ii) prepare and file with the Commission such amendments and
         post-effective amendments to the Registration Statement as may be
         necessary to keep the Registration Statement effective for the
         applicable period set forth in Section 3 or 4 hereof, as applicable, or
         such shorter period as will terminate when all Transfer Restricted
         Notes covered by such Registration Statement have been sold; cause the
         Prospectus to be supplemented by any required Prospectus supplement,
         and as so supplemented to be filed pursuant to Rule 424 under the
         Securities Act, and to comply fully with the applicable provisions of
         Rules 424 and 430A under the Securities Act in a timely manner; and
         comply with the provisions of the Securities Act with respect to the
         disposition of all securities covered by such Registration Statement
         during the applicable period in accordance with the intended method or
         methods of distribution by the sellers thereof set forth in such
         Registration Statement or supplement to the Prospectus;

                  (iii) advise the underwriter(s), if any, and selling Holders
         promptly and, if requested by such Persons, to confirm such advice in
         writing, (A) when the Prospectus or any Prospectus supplement or
         post-effective amendment has been filed, and, with respect to any
         Registration Statement or any post-effective amendment thereto, when
         the same has become effective, (B) of any request by the Commission for
         amendments to the Registration Statement or amendments or supplements
         to the Prospectus or for additional information relating thereto, (C)
         of the issuance by the Commission of any stop order suspending the
         effectiveness of the Registration Statement under the Securities Act or
         of the suspension by any state securities commission of the



                                       8


         qualification of the Transfer Restricted Notes for offering or sale in
         any jurisdiction, or the initiation of any proceeding for any of the
         preceding purposes, and (D) of the existence of any fact or the
         happening of any event that makes any statement of a material fact made
         in the Registration Statement, the Prospectus, any amendment or
         supplement thereto, or any document incorporated by reference therein
         untrue, or that requires the making of any additions to or changes in
         the Registration Statement or the Prospectus in order to make the
         statements therein not misleading. If at any time the Commission shall
         issue any stop order suspending the effectiveness of the Registration
         Statement, or any state securities commission or other regulatory
         authority shall issue an order suspending the qualification or
         exemption from qualification of the Transfer Restricted Notes under
         state securities or Blue Sky laws, the Company shall use its best
         efforts to obtain the withdrawal or lifting of such order at the
         earliest possible time;

                  (iv) furnish without charge to each of the Initial Purchasers,
         each selling Holder named in any Registration Statement, and each of
         the underwriter(s), if any, before filing with the Commission, copies
         of any Registration Statement or any Prospectus included therein or any
         amendments or supplements to any such Registration Statement or
         Prospectus (including all documents incorporated by reference after the
         initial filing of such Registration Statement), which documents will be
         subject to the review of such Holders and underwriter(s) in connection
         with such sale, if any, for a period of at least five business days,
         and the Company will not file any such Registration Statement or
         Prospectus or any amendment or supplement to any such Registration
         Statement or Prospectus (including all such documents incorporated by
         reference) to which an Initial Purchaser of Transfer Restricted Notes
         covered by such Registration Statement or the underwriter(s), if any,
         shall reasonably object in writing within five business days after the
         receipt thereof (such objection to be deemed timely made upon
         confirmation of telecopy transmission within such period). The
         objection of an Initial Purchaser or underwriter, if any, shall be
         deemed to be reasonable if such Registration Statement, amendment,
         Prospectus or supplement, as applicable, as proposed to be filed,
         contains a material misstatement or omission;

                  (v) promptly prior to the filing of any document that is to be
         incorporated by reference into a Registration Statement or Prospectus,
         provide copies of such document to the Initial Purchasers, each selling
         Holder named in any Registration Statement, and to the underwriter(s),
         if any, make the Company's and the Guarantors', if any, representatives
         available for discussion of such document and other customary due
         diligence matters, and include such information in such document prior
         to the filing thereof as such selling Holders or underwriter(s), if
         any, reasonably may request;

                  (vi) make available at reasonable times for inspection by the
         Initial Purchasers, any managing underwriter participating in any
         disposition pursuant to such Registration Statement and any attorney or
         accountant retained by such Initial Purchasers or any of the
         underwriter(s), all financial and other records, pertinent corporate
         documents and properties of the Company and each of the Guarantors, if




                                       9


         any, and cause the officers, directors and employees of the Company and
         each of the Guarantors, if any, to supply all information reasonably
         requested by any such Holder, underwriter, attorney or accountant in
         connection with such Registration Statement subsequent to the filing
         thereof and prior to its effectiveness;

                  (vii) if requested by any selling Holders or the
         underwriter(s), if any, promptly incorporate in any Registration
         Statement or Prospectus, pursuant to a supplement or post-effective
         amendment if necessary, such information as such selling Holders and
         underwriter(s), if any, may reasonably request to have included
         therein, including, without limitation, information relating to the
         "Plan of Distribution" of the Transfer Restricted Notes, information
         with respect to the principal amount of Transfer Restricted Notes being
         sold to such underwriter(s), the purchase price being paid therefor and
         any other terms of the offering of the Transfer Restricted Notes to be
         sold in such offering; and make all required filings of such Prospectus
         supplement or post-effective amendment as soon as practicable after the
         Company is notified of the matters to be incorporated in such
         Prospectus supplement or post-effective amendment;

                  (viii) cause the Transfer Restricted Notes covered by the
         Registration Statement to be rated with the appropriate rating
         agencies, if so requested by the Holders of a majority in aggregate
         principal amount of Notes covered thereby or the underwriter(s), if
         any;

                  (ix) furnish to each selling Holder and each of the
         underwriter(s), if any, without charge, at least one copy of the
         Registration Statement, as first filed with the Commission, and of each
         amendment thereto, including financial statements and schedules, all
         documents incorporated by reference therein and all exhibits (including
         exhibits incorporated therein by reference);

                  (x) deliver to each selling Holder and each of the
         underwriter(s), if any, without charge, as many copies of the
         Prospectus (including each preliminary prospectus) and any amendment or
         supplement thereto as such Persons reasonably may request; the Company
         hereby consents to the use of the Prospectus and any amendment or
         supplement thereto by each of the selling Holders and each of the
         underwriter(s), if any, in connection with the offering and the sale of
         the Transfer Restricted Notes covered by the Prospectus or any
         amendment or supplement thereto;

                  (xi) enter into and cause the Guarantors, if any, to enter
         into such agreements (including an underwriting agreement), and make
         and cause the Guarantors, if any, to make such representations and
         warranties, and take all such other actions in connection therewith in
         order to expedite or facilitate the disposition of the Transfer
         Restricted Notes pursuant to any Registration Statement contemplated by
         this Agreement, all to such extent as may be requested by any Initial
         Purchaser or by any Holder of Transfer Restricted Notes or underwriter
         in connection with any sale or resale pursuant to any Registration
         Statement contemplated by this Agreement; and whether or not an
         underwriting agreement is entered into and whether or not the
         registration is an Underwritten Registration, the Company shall:

                           (1) furnish to each Initial Purchaser, each selling
                  Holder and each underwriter, if any, in such substance and
                  scope as they may request and as are customarily made by



                                       10


                  issuers to underwriters in primary underwritten offerings,
                  upon the date of the Consummation of the Exchange Offer and,
                  if applicable, the effectiveness of the Shelf Registration
                  Statement:

                                    (A) a certificate, dated the date of
                           Consummation of the Exchange Offer or the date of
                           effectiveness of the Shelf Registration Statement, as
                           the case may be, signed by the Chief Financial
                           Officer of the Company, confirming, as of the date
                           thereof, the matters set forth in Section 7(i) of the
                           Purchase Agreement, and such other matters as such
                           parties may reasonably request;

                                    (B) an opinions, dated the date of
                           Consummation of the Exchange Offer or the date of
                           effectiveness of the Shelf Registration Statement, as
                           the case may be, of counsel for the Company and each
                           of its Subsidiaries (as defined in the Purchase
                           Agreement), covering the matters set forth in
                           Sections 7(c) and 7(d) of the Purchase Agreement and
                           such other matters as such parties may reasonably
                           request, and in any event including a statement to
                           the effect that such counsel has participated in
                           conferences with officers and other representatives
                           of the Company, representatives of the independent
                           public accountants for the Company, the Initial
                           Purchasers' representatives and the Initial
                           Purchasers' counsel in connection with the
                           preparation of such Registration Statement and the
                           related Prospectus and has considered the matters
                           required to be stated therein and the statements
                           contained therein, although such counsel has not
                           independently verified the accuracy, completeness or
                           fairness of such statements; and that such counsel
                           advises that, on the basis of the foregoing, no facts
                           came to such counsel's attention that caused such
                           counsel to believe that the applicable Registration
                           Statement, at the time such Registration Statement or
                           any post-effective amendment thereto became
                           effective, and, in the case of the Exchange Offer
                           Registration Statement, as of the date of
                           Consummation, contained an untrue statement of a
                           material fact or omitted to state a material fact
                           required to be stated therein or necessary to make
                           the statements therein not misleading, or that the
                           Prospectus contained in such Registration Statement
                           as of its date and, in the case of the opinion dated
                           the date of Consummation of the Exchange Offer, as of
                           the date of Consummation, contained an untrue
                           statement of a material fact or omitted to state a
                           material fact necessary in order to make the
                           statements therein, in light of the circumstances
                           under which they were made, not misleading. Without
                           limiting the foregoing, such counsel may state
                           further that such counsel assumes no responsibility
                           for, and has not independently verified, the
                           accuracy, completeness or fairness of the financial
                           statements, notes and schedules and other financial
                           data included in any Registration Statement
                           contemplated by this Agreement or the related
                           Prospectus; and

                                    (C) a customary comfort letter, dated as of
                           the date of Consummation of the Exchange Offer or the
                           date of effectiveness of the Shelf Registration
                           Statement, as the case may be, from the Company's
                           independent accountants, in the customary form and
                           covering matters of the type customarily covered in



                                       11


                           comfort letters by underwriters in connection with
                           primary underwritten offerings, and affirming the
                           matters set forth in the comfort letters delivered
                           pursuant to Section 7(f) of the Purchase Agreement,
                           without exception;

                           (2) set forth in full or incorporate by reference in
                  the underwriting agreement, if any, the indemnification
                  provisions and procedures of Section 8 hereof with respect to
                  all parties to be indemnified pursuant to said Section; and

                           (3) deliver such other documents and certificates as
                  may be reasonably requested by such parties to evidence
                  compliance with clause (A) above and with any customary
                  conditions contained in the underwriting agreement or other
                  agreement entered into by the Company or the Guarantors, if
                  any, pursuant to this clause (xi), if any.

                  If at any time the representations and warranties of the
Company or the Guarantors, if any, contemplated in this clause (xi) cease to be
true and correct, the Company shall so advise the Initial Purchasers and the
underwriter(s), if any, and each selling Holder promptly and, if requested by
such Persons, shall confirm such advice in writing;

                  (xii) prior to any public offering of Transfer Restricted
         Notes, cooperate and cause the Guarantors, if any, to cooperate with
         the selling Holders, the underwriter(s), if any, and their respective
         counsel in connection with the registration and qualification of the
         Transfer Restricted Notes under the securities or Blue Sky laws of such
         jurisdictions as the selling Holders or underwriter(s) may request and
         do any and all other acts or things necessary or advisable to enable
         the disposition in such jurisdictions of the Transfer Restricted Notes
         covered by the Shelf Registration Statement; PROVIDED, HOWEVER, that
         neither the Company nor any of the Guarantors, if any, shall be
         required to register or qualify as a foreign corporation where it is
         not then so qualified or to take any action that would subject it to
         the service of process in suits or to taxation, other than as to
         matters and transactions relating to the Registration Statement, in any
         jurisdiction where it is not then so subject;

                  (xiii) shall issue, upon the request of any Holder of Initial
         Notes covered by the Shelf Registration Statement, Exchange Notes,
         having an aggregate principal amount equal to the aggregate principal
         amount of Initial Notes surrendered to the Company by such Holder in
         exchange therefor or being sold by such Holder; such Exchange Notes to
         be registered in the name of such Holder or in the name of the
         purchaser(s) of such Notes, as the case may be; in return, the Initial
         Notes held by such Holder shall be surrendered to the Company for
         cancellation;

                  (xiv) cooperate and cause the Guarantors, if any, to cooperate
         with the selling Holders and the underwriter(s), if any, to facilitate
         the timely preparation and delivery of certificates representing



                                       12



         Transfer Restricted Notes to be sold and not bearing any restrictive
         legends; and enable such Transfer Restricted Notes to be in such
         denominations and registered in such names as the Holders or the
         underwriter(s), if any, may request at least two business days prior to
         any sale of Transfer Restricted Notes made by such underwriter(s);

                  (xv) use its best efforts to cause the Transfer Restricted
         Notes covered by the Registration Statement to be registered with or
         approved by such other governmental agencies or authorities as may be
         necessary to enable the seller or sellers thereof or the
         underwriter(s), if any, to consummate the disposition of such Transfer
         Restricted Notes, subject to the proviso contained in clause (xii)
         above;

                  (xvi) if any fact or event contemplated by Section
         6(c)(iii)(D) above shall exist or have occurred, prepare a supplement
         or post-effective amendment to the Registration Statement or related
         Prospectus or any document incorporated therein by reference or file
         any other required document so that, as thereafter delivered to the
         purchasers of Transfer Restricted Notes, the Prospectus will not
         contain an untrue statement of a material fact or omit to state any
         material fact necessary to make the statements therein not misleading;

                  (xvii) provide a CUSIP number for all Exchange Notes not later
         than the effective date of the Registration Statement and provide the
         Trustee under the Indenture with printed certificates for the Exchange
         Notes which are in a form eligible for deposit with the Depositary
         Trust Company;

                  (xviii) cooperate and assist in any filings required to be
         made with the NASD and in the performance of any due diligence
         investigation by any underwriter (including any "qualified independent
         underwriter") that is required to be retained in accordance with the
         rules and regulations of the NASD, and use its reasonable best efforts
         to cause such Registration Statement to become effective and approved
         by such governmental agencies or authorities as may be necessary to
         enable the Holders selling Transfer Restricted Notes to consummate the
         disposition of such Transfer Restricted Notes;

                  (xix) otherwise use its best efforts to comply with all
         applicable rules and regulations of the Commission, and make generally
         available to its security holders, as soon as practicable, a
         consolidated earnings statement meeting the requirements of Rule 158
         (which need not be audited) for the twelve-month period (A) commencing
         at the end of any fiscal quarter in which Transfer Restricted Notes are
         sold to underwriters in a firm or best efforts Underwritten Offering or
         (B) if not sold to underwriters in such an offering, beginning with the
         first month of the Company's first fiscal quarter commencing after the
         effective date of the Registration Statement;

                  (xx) cause the Indenture to be qualified under the Trust
         Indenture Act not later than the effective date of the first
         Registration Statement required by this Agreement, and, in connection
         therewith, cooperate and cause the Guarantors, if any, to cooperate
         with the Trustee and the Holders of Securities to effect such changes
         to the Indenture as may be required for such Indenture to be so
         qualified in accordance with the terms of the Trust Indenture Act; and
         to execute and cause each of the Guarantors, if any, to execute and use
         its best efforts to cause the Trustee to execute, all documents that



                                       13


         may be required to effect such changes and all other forms and
         documents required to be filed with the Commission to enable such
         Indenture to be so qualified in a timely manner;

                  (xxi) cause all Transfer Restricted Notes covered by the
         Registration Statement to be listed on each securities exchange on
         which similar securities issued by the Company are then listed if
         requested by the Holders of a majority in aggregate principal amount of
         Initial Notes or the managing underwriter(s), if any; and

                  (xxii) provide promptly to each Holder upon request each
         document filed with the Commission pursuant to the requirements of
         Section 13 and Section 15 of the Exchange Act.

                  Each Holder agrees by acquisition of a Transfer Restricted
Note that, upon receipt of any notice from the Company of the existence of any
fact of the kind described in Section 6(c)(iii)(D) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Notes pursuant to the
applicable Registration Statement until such Holder's receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof,
or until it is advised in writing (the "ADVICE") by the Company that the use of
the Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus. If so
directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted Notes
that was current at the time of receipt of such notice. In the event the Company
shall give any such notice, the time period regarding the effectiveness of such
Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall
be extended by the number of days during the period from and including the date
of the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to and
including the date when each selling Holder covered by such Registration
Statement shall have received the copies of the supplemented or amended
Prospectus contemplated by Section 6(c)(xvi) hereof or shall have received the
Advice; however, no such extension shall be taken into account in determining
whether Liquidated Damages are due pursuant to Section 5 hereof or the amount of
such Liquidated Damages, it being agreed that the Company's option to suspend
use of a Registration Statement pursuant to this paragraph shall be treated as a
Registration Default for purposes of Section 5.

                  SECTION 7. REGISTRATION EXPENSES

                  (a) All expenses incident to the Company's or the Guarantors',
if any, performance of or compliance with this Agreement will be borne by the
Company, regardless of whether a Registration Statement becomes effective,
including without limitation: (i) all registration and filing fees and expenses
(including filings made by any Initial Purchaser or Holder with the NASD (and,
if applicable, the fees and expenses of any "qualified independent underwriter"
and its counsel that may be required by the rules and regulations of the NASD));
(ii) all fees and expenses of compliance with federal securities and state Blue
Sky or securities laws; (iii) all expenses of printing (including printing
certificates for the Exchange Notes to be issued in the Exchange Offer and



                                       14


printing of Prospectuses), messenger and delivery services and telephone; (iv)
all fees and disbursements of counsel for the Company and the Guarantors, if
any, and, subject to Section 7(b) below, the Holders of Transfer Restricted
Notes; (v) all application and filing fees in connection with listing the
Exchange Notes on a national securities exchange or automated quotation system
pursuant to the requirements thereof; (vi) all fees and disbursements of
independent certified public accountants of the Company and each of the
Guarantors, if any (including the expenses of any special audit and comfort
letters required by or incident to such performance); and (vii) all fees and
expenses relating to the qualification of the Indenture under the applicable
securities laws.

                  The Company will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company.

                  (b) In connection with any Registration Statement required by
this Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company will reimburse the
Initial Purchasers and the Holders of Transfer Restricted Notes being tendered
in the Exchange Offer and/or resold pursuant to the "Plan of Distribution"
contained in the Exchange Offer Registration Statement or registered pursuant to
the Shelf Registration Statement, as applicable, for the reasonable fees and
disbursements of not more than one counsel, who shall be Shearman & Sterling or
such other counsel as may be chosen by the Holders of a majority in principal
amount of the Transfer Restricted Notes for whose benefit such Registration
Statement is being prepared.

                  SECTION 8. INDEMNIFICATION

                  (a) The Company agrees to indemnify and hold harmless (i) each
Holder and (ii) each person, if any, who controls (within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of
the persons referred to in this clause (ii) being hereinafter referred to as a
"controlling person") and (iii) the respective officers, directors, partners,
employees, representatives and agents of any Holder or any controlling person
(any person referred to in clause (i), (ii) or (iii) may hereinafter be referred
to as an "INDEMNIFIED HOLDER"), to the fullest extent lawful, from and against
any and all losses, claims, damages, liabilities, judgments, actions and
expenses (including without limitation and as incurred, reimbursement of all
reasonable costs of investigating, preparing, pursuing, settling, compromising,
paying or defending any claim or action, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, including the
reasonable fees and expenses of counsel to any Indemnified Holder), joint or
several, directly or indirectly caused by, related to, based upon, arising out
of or in connection with any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement or Prospectus (or any
amendment or supplement thereto), or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or expenses are caused by an untrue statement or omission
or alleged untrue statement or omission that is made in reliance upon and in
conformity with information relating to any of the Holders furnished in writing
to the Company by any of the Holders expressly for use therein. This indemnity
agreement shall be in addition to any liability which the Company may otherwise
have.



                                       15


                  (b) Each Holder of Transfer Restricted Notes agrees, severally
and not jointly, to indemnify and hold harmless the Company and its directors
and officers of the Company who sign a Registration Statement, and any person
controlling (within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act) the Company, and the respective offices, directors,
partners, employees, representatives and agents of each such person, to the same
extent as the foregoing indemnity from the Company to each of the Indemnified
Holders, but only with respect to claims and actions based on information
relating to such Holder furnished in writing by such Holder expressly for use in
any Registration Statement. In case any action or proceeding shall be brought
against the Company or its directors or officers or any such controlling person
in respect of which indemnity may be sought against a Holder of Transfer
Restricted Notes, such Holder shall have the rights and duties given the Company
and the Company or its directors or officers or such controlling person shall
have the rights and duties given to each Holder by the preceding paragraph. In
no event shall the liability of any selling Holder hereunder be greater in
amount than the dollar amount of the proceeds received by such Holder upon the
sale of the Notes giving rise to such indemnification obligation.

                  (c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability that it may have under this Section 8 except to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses 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 this
Section 8. If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation; PROVIDED,
HOWEVER, that the Indemnified Holders shall have the right to employ counsel to
represent jointly the Indemnified Holders and those Indemnified Holders and
their respective directors, officers, employees and controlling persons who may
be subject to liability arising out of any claim in respect of which indemnity
may be sought by the Indemnified Holders against the Company under this Section
8 if, in the reasonable judgment of the Indemnified Holders, it is advisable for
the Indemnified Holders and those directors, officers, employees and controlling
persons to be jointly represented by separate counsel, and in that event the
fees and expenses of such separate counsel shall be paid by the Company. No
indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the



                                       16


indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with the consent of the indemnifying party or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.

                  (d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under Section 8(a) or Section 8(b) hereof
(other than by reason of exceptions provided in those Sections) in respect of
any losses, claims, damages, liabilities, judgments, actions or expenses
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses in such proportion as is appropriate to reflect the
relative benefits received by the Company, on the one hand, and the Holders, on
the other hand, from the Initial Placement (which in the case of the Company
shall be deemed to be equal to the total gross proceeds from the Initial
Placement as set forth on the cover page of the Offering Memorandum), the amount
of Liquidated Damages which did not become payable as a result of the filing of
the Registration Statement resulting in such losses, claims, damages,
liabilities, judgments actions or expenses, and such Registration Statement, or
if such allocation is not permitted by applicable law, the relative fault of the
Company, on the one hand, and of the Indemnified Holder, on the other hand, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of the Company, on the one hand,
and of the Indemnified Holder, on the other, shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Indemnified Holder and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The amount paid or payable by
a party as a result of the losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 8(a), any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any action or claim.

                  The Company and each Holder of Transfer Restricted Notes agree
that it would not be just and equitable if contribution pursuant to this Section
8(d) were determined by pro rata allocation (even if the Holders were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or expenses referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8, none of the
Holders (and its related Indemnified Holders) shall be required to contribute,
in the aggregate, any amount in excess of the amount by which the total discount
received by such Holder with respect to the Initial Notes exceeds the amount of
any damages which such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No


                                       17


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. The Holders'
obligations to contribute pursuant to this Section 8(d) are several in
proportion to the respective principal amount of Initial Notes held by each of
the Holders hereunder and not joint.

                  SECTION 9. RULE 144A

                   Unless the Company is subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act, the Company shall, for so long as
any Transfer Restricted Notes remain outstanding, make available to any Holder
or beneficial owner of Transfer Restricted Notes in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Notes from
such Holder or beneficial owner, the information required by Rule 144A(d)(4)
under the Securities Act in order to permit resales of such Transfer Restricted
Notes pursuant to Rule 144A.

                  SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS

                  No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Notes on the basis provided in any underwriting arrangements approved
by the Persons entitled hereunder to approve such arrangements and (b) completes
and executes all reasonable questionnaires, powers of attorney, indemnities,
underwriting agreements, lock-up letters and other documents required under the
terms of such underwriting arrangements.

                  SECTION 11. SELECTION OF UNDERWRITERS

                  The Holders of Transfer Restricted Notes covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Notes in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Notes included in such
offering; PROVIDED, that such investment bankers and managers must be reasonably
satisfactory to the Company.

                  SECTION 12. MISCELLANEOUS

                  (a) REMEDIES. The Company hereby agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of the provisions of this Agreement and hereby agrees to waive the defense
in any action for specific performance that a remedy at law would be adequate.

                  (b) NO INCONSISTENT AGREEMENTS. The Company will not and will
cause the Guarantors, if any, not to, on or after the date of this Agreement,
enter into any agreement with respect to its securities that is inconsistent
with the rights granted to the Holders in this Agreement or otherwise conflicts
with the provisions hereof. The Company has not entered into any agreement
granting any registration rights with respect to its securities to any Person.
The rights granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the Company's
securities under any agreement in effect on the date hereof.




                                       18


                  (c) ADJUSTMENTS AFFECTING THE SECURITIES. The Company will not
take any action, or permit any change to occur, with respect to the Notes that
would materially and adversely affect the ability of the Holders to Consummate
any Exchange Offer, unless such action or change is required by applicable law.

                  (d) AMENDMENTS AND WAIVERS. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless the Company has
obtained the written consent of Holders of a majority of the outstanding
principal amount of Transfer Restricted Notes. Notwithstanding the foregoing, a
waiver or consent to departure from the provisions hereof that relates
exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant to
such Exchange Offer may be given by the Holders of a majority of the outstanding
principal amount of Transfer Restricted Notes being tendered or registered;
PROVIDED that, with respect to any matter that directly or indirectly affects
the rights of any Initial Purchaser hereunder, the Company shall obtain the
written consent of each such Initial Purchaser with respect to which such
amendment, qualification, supplement, waiver, consent or departure is to be
effective.

                  (e) NOTICES. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or certified, return receipt requested), telex, telecopier, or
air courier guaranteeing overnight delivery:

                  (i) if to a Holder, at the address set forth on the records of
         the Registrar under the Indenture, with a copy to the Registrar under
         the Indenture; and

                  (ii) if to the Company:

                                    Wackenhut Corrections Corporation
                                    One Park Place
                                    621 NW 53rd Street
                                    Suite 700
                                    Boca Raton, FL 33487
                                    Facsimile:  (561) 999-7744
                                    Attention:  John J. Bulfin, Esq.

                                    with a copy to:

                                    Akerman Senterfitt
                                    One Southeast Third Avenue
                                    28th Floor
                                    Miami, FL 33131-1714
                                    Facsimile:  (305) 374-5095
                                    Attention:  Stephen K. Roddenberry



                                       19



                  (iii) if to the Initial Purchasers:

                                    BNP Paribas Securities Corp.
                                    The Equitable Tower
                                    787 Seventh Avenue
                                    New York, NY 10019-6016
                                    Facsimile:  (212) 841-3561
                                    Attention:  Douglas Cook, Esq.

                                    Lehman Brothers Inc.
                                    745 Seventh Avenue
                                    New York, NY 10019
                                    Facsimile:  (212) 526-0943
                                    Attention:  Syndicate

                                    and

                                    Lehman Brothers Inc.
                                    Litigation Department
                                    399 Park Avenue
                                    New York, NY 10022

                                    with a copy to:

                                    Shearman & Sterling LLP
                                    599 Lexington Avenue
                                    New York, NY 10022-6069
                                    Facsimile:  (212) 848-7179
                                    Attention:  Andrew Schleider

                  All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if faxed; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.

                  Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee at
the address specified in the Indenture.

                  (f) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Notes; PROVIDED, HOWEVER,
that this Agreement shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless and to the extent such successor or
assign acquired Transfer Restricted Notes from such Holder.

                  (g) COUNTERPARTS. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of


                                       20


which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

                  (h) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.

                  (i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO THE CONFLICT OF LAW RULES THEREOF.

                  (j) SEVERABILITY. In the event that 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.

                  (k) ENTIRE AGREEMENT. This Agreement together with the
Purchase Agreement, the Notes, and the Indenture is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company with respect to
the Transfer Restricted Notes. This Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject matter.




                [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]







                                       21


                  IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.

                                          WACKENHUT CORRECTIONS CORPORATION




                                          By:   /s/ John G. O'Rourke
                                                -------------------------------
                                                Name:  John G. O'Rourke
                                                Title: Chief Financial Officer-
                                                       Senior Vice President




The foregoing Registration Rights Agreement is
hereby confirmed and accepted as
of the date first above written.

BNP PARIBAS SECURITIES CORP.
LEHMAN BROTHERS INC.
FIRST ANALYSIS SECURITIES CORPORATION
SOUTHTRUST SECURITIES, INC.
COMERICA SECURITIES, INC.
Acting severally on behalf of themselves and the
several Initial Purchasers


By: BNP Paribas Securities Corp.



By: /s/ Douglas Cook
    -----------------------------------
    Name:  Douglas Cook
    Title: Managing Direcor



                                       22

EX-10.1

                                                                    Exhibit 10.1

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

                                  $150,000,000

                              AMENDED AND RESTATED
                                CREDIT AGREEMENT

                            dated as of July 9, 2003,

                                  by and among

                       WACKENHUT CORRECTIONS CORPORATION,
                                  as Borrower,

                         the Lenders referred to herein,

                                  BNP PARIBAS,
                             as Administrative Agent
                             and Syndication Agent,

                              BANK OF AMERICA, N.A.
                              and SOUTHTRUST BANK,
                            as Co-Syndication Agents,

                                       and

                                 COMERICA BANK,
                            as Co-Documentation Agent

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

                                  BNP PARIBAS,
                                as Lead Arranger



                                TABLE OF CONTENTS



                                                                                                                   PAGE
                                                                                                                
ARTICLE I             DEFINITIONS...............................................................................     1

          SECTION 1.1        Definitions........................................................................     1

          SECTION 1.2        General............................................................................    18

          SECTION 1.3        Other Definitions and Provisions...................................................    18

          SECTION 1.4        Effectiveness of Euro Provisions...................................................    18

          SECTION 1.5        Currency Equivalents...............................................................    18

ARTICLE II            REVOLVING CREDIT FACILITY.................................................................    18

          SECTION 2.1        Revolving Credit Loans.............................................................    18

          SECTION 2.2        Swingline Loans....................................................................    19

          SECTION 2.3        Procedure for Advances of Revolving Credit Loans and Swingline Loans...............    20

          SECTION 2.4        Repayment of Loans.................................................................    21

          SECTION 2.5        Notes..............................................................................    21

          SECTION 2.6        Permanent Reduction of the Revolving Credit Commitment.............................    22

          SECTION 2.7        Termination of Revolving Credit Facility...........................................    22

ARTICLE III           LETTER OF CREDIT FACILITY.................................................................    22

          SECTION 3.1        L/C Commitment.....................................................................    22

          SECTION 3.2        Procedure for Issuance of Letters of Credit........................................    23

          SECTION 3.3        Commissions and Other Charges......................................................    23

          SECTION 3.4        L/C Participations.................................................................    24

          SECTION 3.5        Reimbursement of Letter of Credit Drawings.........................................    25

          SECTION 3.6        Obligations Absolute...............................................................    26

          SECTION 3.7        Excess L/C Obligations.............................................................    26

          SECTION 3.8        Redenomination under EMU...........................................................    26

          SECTION 3.9        Regulatory Limitation..............................................................    27

          SECTION 3.10       Exchange Indemnification and Increased Costs.......................................    27

          SECTION 3.11       Rounding and Other Consequential Changes...........................................    27

          SECTION 3.12       Effect of Application..............................................................    27

ARTICLE IV            TERM LOAN FACILITY........................................................................    28

          SECTION 4.1        Term Loan..........................................................................    28

          SECTION 4.2        Procedure for Advance of Term Loan.................................................    28

          SECTION 4.3        Repayment of Term Loan.............................................................    28

          SECTION 4.4        Prepayments of Term Loan...........................................................    29

          SECTION 4.5        Term Notes.........................................................................    30


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                                TABLE OF CONTENTS
                                   (CONTINUED)



                                                                                                                   PAGE
                                                                                                                
ARTICLE V             GENERAL LOAN PROVISIONS...................................................................    31

          SECTION 5.1        Interest...........................................................................    31

          SECTION 5.2        Notice and Manner of Conversion or Continuation of Loans...........................    33

          SECTION 5.3        Fees...............................................................................    33

          SECTION 5.4        Manner of Payment..................................................................    33

          SECTION 5.5        Crediting of Payments and Proceeds.................................................    34

          SECTION 5.6        Adjustments........................................................................    34

          SECTION 5.7        Nature of Obligations of Lenders Regarding Extensions of Credit; Assumption by the
                             Administrative Agent...............................................................    35

          SECTION 5.8        Changed Circumstances..............................................................    35

          SECTION 5.9        Indemnity..........................................................................    37

          SECTION 5.10       Capital Requirements...............................................................    37

          SECTION 5.11       Taxes..............................................................................    37

          SECTION 5.12       Security...........................................................................    39

ARTICLE VI            CLOSING; CONDITIONS OF CLOSING AND BORROWING..............................................    39

          SECTION 6.1        Closing............................................................................    39

          SECTION 6.2        Conditions to Closing..............................................................    39

          SECTION 6.3        Conditions to All Extensions of Credit.............................................    43

ARTICLE VII           REPRESENTATIONS AND WARRANTIES OF THE BORROWER............................................    44

          SECTION 7.1        Representations and Warranties.....................................................    44

          SECTION 7.2        Survival of Representations and Warranties, Etc....................................    50

ARTICLE VIII          FINANCIAL INFORMATION AND NOTICES.........................................................    50

          SECTION 8.1        Financial Statements and Projections...............................................    50

          SECTION 8.2        Officer's Compliance Certificate...................................................    51

          SECTION 8.3        Annual Accountants' Certificate....................................................    51

          SECTION 8.4        Other Reports......................................................................    52

          SECTION 8.5        Notice of Litigation and Other Matters.............................................    52

          SECTION 8.6        Accuracy of Information............................................................    53

ARTICLE IX            AFFIRMATIVE COVENANTS.....................................................................    53

          SECTION 9.1        Preservation of Corporate Existence and Related Matters............................    53

          SECTION 9.2        Maintenance of Property............................................................    53

          SECTION 9.3        Insurance..........................................................................    53

          SECTION 9.4        Accounting Methods and Financial Records...........................................    53

          SECTION 9.5        Payment and Performance of Obligations.............................................    54


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                                TABLE OF CONTENTS
                                   (CONTINUED)



                                                                                                                   PAGE
                                                                                                                
          SECTION 9.6        Compliance With Laws and Approvals.................................................    54

          SECTION 9.7        Environmental Laws.................................................................    54

          SECTION 9.8        Compliance with ERISA..............................................................    54

          SECTION 9.9        Compliance With Agreements.........................................................    54

          SECTION 9.10       Visits and Inspections.............................................................    54

          SECTION 9.11       Additional Subsidiaries............................................................    55

          SECTION 9.12       Use of Proceeds....................................................................    56

          SECTION 9.13       Landlord Consents..................................................................    56

          SECTION 9.14       Further Assurances.................................................................    56

ARTICLE X             FINANCIAL COVENANTS.......................................................................    56

          SECTION 10.1       Leverage Ratios....................................................................    56

          SECTION 10.2       Fixed Charge Coverage Ratio........................................................    57

          SECTION 10.3       Capital Expenditures...............................................................    57

          SECTION 10.4       Minimum Net Worth..................................................................    57

ARTICLE XI            NEGATIVE COVENANTS........................................................................    58

          SECTION 11.1       Limitations on Debt................................................................    58

          SECTION 11.2       Limitations on Liens...............................................................    59

          SECTION 11.3       Limitations on Loans, Advances, Investments and Acquisitions.......................    59

          SECTION 11.4       Limitations on Mergers and Liquidation.............................................    61

          SECTION 11.5       Limitations on Sale of Assets......................................................    61

          SECTION 11.6       Restricted Payments................................................................    61

          SECTION 11.7       Limitations on Exchange and Issuance of Capital Stock..............................    62

          SECTION 11.8       Transactions with Affiliates.......................................................    62

          SECTION 11.9       Certain Accounting Changes; Organizational Documents...............................    62

          SECTION 11.10      Amendments; Payments and Prepayments of Certain Debt...............................    62

          SECTION 11.11      Restrictive Agreements.............................................................    62

          SECTION 11.12      Nature of Business.................................................................    62

          SECTION 11.13      Impairment of Security Interests...................................................    62

ARTICLE XII           DEFAULT AND REMEDIES......................................................................    63

          SECTION 12.1       Events of Default..................................................................    63

          SECTION 12.2       Remedies...........................................................................    65

          SECTION 12.3       Rights and Remedies Cumulative; Non-Waiver; etc....................................    65

          SECTION 12.4       Judgment Currency..................................................................    66


                                      iii



                                TABLE OF CONTENTS
                                   (CONTINUED)



                                                                                                                   PAGE
                                                                                                                
ARTICLE XIII          THE AGENTS................................................................................    66

          SECTION 13.1       Appointment........................................................................    66

          SECTION 13.2       Delegation of Duties...............................................................    66

          SECTION 13.3       Exculpatory Provisions.............................................................    67

          SECTION 13.4       Reliance by the Agents.............................................................    67

          SECTION 13.5       Notice of Default..................................................................    67

          SECTION 13.6       Non-Reliance on the Agents and Other Lenders.......................................    68

          SECTION 13.7       Indemnification....................................................................    68

          SECTION 13.8       The Agents in Their Individual Capacities..........................................    68

          SECTION 13.9       Resignation of the Agents; Successor Agents........................................    68

ARTICLE XIV           MISCELLANEOUS.............................................................................    69

          SECTION 14.1       Notices............................................................................    69

          SECTION 14.2       Expenses; Indemnity................................................................    71

          SECTION 14.3       Set-off............................................................................    72

          SECTION 14.4       Governing Law......................................................................    72

          SECTION 14.5       Jurisdiction and Venue.............................................................    72

          SECTION 14.6       Waiver of Jury Trial...............................................................    73

          SECTION 14.7       Reversal of Payments...............................................................    73

          SECTION 14.8       Injunctive Relief; Punitive Damages................................................    73

          SECTION 14.9       Accounting Matters.................................................................    73

          SECTION 14.10      Successors and Assigns; Participations.............................................    74

          SECTION 14.11      Amendments, Waivers and Consents...................................................    77

          SECTION 14.12      Performance of Duties..............................................................    78

          SECTION 14.13      All Powers Coupled with Interest...................................................    78

          SECTION 14.14      Survival of Indemnities............................................................    79

          SECTION 14.15      Titles and Captions................................................................    79

          SECTION 14.16      Severability of Provisions.........................................................    79

          SECTION 14.17      Counterparts.......................................................................    79

          SECTION 14.18      Term of Agreement..................................................................    79

          SECTION 14.19      Advice of Counsel..................................................................    79

          SECTION 14.20      No Strict Construction.............................................................    79

          SECTION 14.21      Inconsistencies with Other Documents; Independent Effect of   Covenants............    79

          SECTION 14.22      Continuity of Contract.............................................................    80


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                                TABLE OF CONTENTS
                                   (CONTINUED)



                                                                                                                   PAGE
                                                                                                                
          SECTION 14.23      Increase of Revolving Credit Commitments...........................................    80

          SECTION 14.24      Transition Provisions..............................................................    80


                                       v



                                TABLE OF CONTENTS
                                   (CONTINUED)

EXHIBITS

                                
Exhibit A-1                -       Form of Revolving Credit Note
Exhibit A-2                -       Form of Swingline Note
Exhibit A-3                -       Form of Term Note
Exhibit B                  -       Form of Notice of Borrowing
Exhibit C                  -       Form of Notice of Account Designation
Exhibit D                  -       Form of Notice of Prepayment
Exhibit E                  -       Form of Notice of Conversion/Continuation
Exhibit F                  -       Form of Officer's Compliance Certificate
Exhibit G                  -       Form of Assignment and Acceptance
Exhibit H                  -       Form of Guaranty Agreement
Exhibit I                  -       Form of Collateral Agreement
Exhibit J                  -       Form of Joinder Agreement
Exhibit K                  -       Form of Collateral Assignment

SCHEDULES

Schedule 1.1(a)            -       Unrestricted Subsidiaries
Schedule 4.4(b)(iii)       -       Certain Assets
Schedule 7.1(a)            -       Jurisdictions of Organization and Qualification
Schedule 7.1(b)            -       Subsidiaries and Capitalization
Schedule 7.1(i)            -       ERISA Plans
Schedule 7.1(l)            -       Material Contracts
Schedule 7.1(m)            -       Labor and Collective Bargaining Agreements
Schedule 7.1(r)            -       Real Estate Owned
Schedule 7.1(t)            -       Debt and Guaranty Obligations
Schedule 7.1(u)            -       Litigation
Schedule 11.2              -       Existing Liens
Schedule 11.3              -       Existing Loans, Advances and Investments
Schedule 11.8              -       Transactions with Affiliates



                                       vi



         AMENDED AND RESTATED CREDIT AGREEMENT, dated as of the 9th day of July,
2003, by and among WACKENHUT CORRECTIONS CORPORATION, a Florida corporation, as
Borrower, the lenders who are or may become a party to this Agreement, as
Lenders, BNP PARIBAS, as Administrative Agent for the Lenders, and BNP PARIBAS,
as Syndication Agent.

                              STATEMENT OF PURPOSE

         The Borrower, the lenders parties thereto, Wachovia Bank, National
Association, as administrative agent, and BNP Paribas, as syndication agent,
entered into a Credit Agreement dated as of December 12, 2002 (as amended,
modified or supplemented to the date hereof, the "Existing Facility").

         The parties hereto desire to amend and restate the Existing Facility as
provided herein.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree that the Existing Facility shall be amended and restated in its
entirety as follows:

                                   ARTICLE I

                                   DEFINITIONS

         SECTION 1.1 Definitions. The following terms when used in this
Agreement shall have the meanings assigned to them below:

         "Administrative Agent" means BNP Paribas in its capacity as
Administrative Agent hereunder, and any successor thereto appointed pursuant to
Section 13.9.

         "Administrative Agent's Office" means the office of the Administrative
Agent specified in or determined in accordance with the provisions of Section
14.1(c).

         "Affiliate" means, with respect to any Person, any other Person (other
than a Subsidiary of the Borrower) which directly or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common control
with, such first Person or any of its Subsidiaries. The term "control" means (a)
the power to vote ten percent (10%) or more of the securities or other equity
interests of a Person having ordinary voting power, or (b) the possession,
directly or indirectly, of any other power to direct or cause the direction of
the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.

         "Agents" means the collective reference to the Administrative Agent and
the Syndication Agent.

         "Aggregate Commitment" means the aggregate amount of the Lenders'
Commitments hereunder, as such amount may be reduced or otherwise modified at
any time or from time to time pursuant to the terms hereof. On the Closing Date,
the Aggregate Commitment shall be One Hundred Fifty Million Dollars
($150,000,000).

         "Agreement" means this Amended and Restated Credit Agreement, as
amended, restated, supplemented or otherwise modified from time to time.

         "Alternative Currency" means (a) the euro, (b) the Pound Sterling, (c)
the Australian Dollar, (d) the South African Rand and (e) with the prior written
consent of the Issuing Lender, any other lawful currency (other than Dollars);
provided that in each case of (a) through (e) above, such currency is freely



transferable and convertible into Dollars in the United States currency market
and freely available to the Issuing Lender in the London interbank deposit
market.

         "Alternative Currency Letter of Credit" means any Letter of Credit
denominated in an Alternative Currency and all such Alternative Currency Letters
of Credit collectively as the context requires.

         "Applicable Law" means all applicable provisions of constitutions,
laws, statutes, ordinances, rules, treaties, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities and
all orders and decrees of all courts and arbitrators.

         "Applicable Margin" has the meaning assigned thereto in Section 5.1(c).

         "Application" means an application, in the form specified by the
Issuing Lender from time to time, requesting the Issuing Lender to issue a
Letter of Credit.

         "Approved Fund" means any Person (other than a natural Person),
including, without limitation, any special purpose entity, that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business;
provided, that such Approved Fund must be administered by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

         "Assignment and Acceptance" has the meaning assigned thereto in Section
14.10.

         "Assignment Agreement" has the meaning set forth in the Collateral
Agreement.

         "Assignment of Claims Act" means Assignment of Claims Act of 1940 (41
U.S.C. Section 15, 31 U.S.C. Section 3737, and 31 U.S.C. Section 3727),
including all amendments thereto and regulations promulgated thereunder.

         "Australian Dollars" means, at any time of determination, the then
official currency of Australia.

         "Base Rate" means, at any time, the higher of (a) the Prime Rate and
(b) the Federal Funds Rate plus 1/2 of 1%; each change in the Base Rate shall
take effect simultaneously with the corresponding change or changes in the Prime
Rate or the Federal Funds Rate.

         "Base Rate Loan" means any Loan bearing interest at a rate based upon
the Base Rate as provided in Section 5.1(a).

         "Benefited Lender" has the meaning assigned thereto in Section 5.6.

         "Borrower" means Wackenhut Corrections Corporation, a Florida
corporation, in its capacity as borrower hereunder.

         "Business Day" means (a) for all purposes other than as set forth in
clause (b) below, any day other than a Saturday, Sunday or legal holiday on
which banks in New York, New York, are open for the conduct of their domestic or
international commercial banking business, as applicable, and (b) with respect
to all notices and determinations in connection with, and payments of principal
and interest on, any LIBOR Rate Loan, any day that is a Business Day described
in clause (a) and that is also a day for trading by and between banks in Dollar
deposits in the London interbank market. Notwithstanding the foregoing, with
respect to any amount denominated or to be denominated in the euro, any
reference to a "Business Day" shall be construed as a reference to a day (other
than a Saturday or Sunday) on which

                                        2



banks are generally open for business in New York, New York and prime banks in
London generally provide quotations for deposits denominated in the euro.

         "Calculation Date" has the meaning assigned thereto in Section 5.1(c).

         "Capital Asset" means, with respect to the Borrower and its
Subsidiaries, any asset that should, in accordance with GAAP, be classified and
accounted for as a capital asset on a Consolidated balance sheet of the Borrower
and its Subsidiaries.

         "Capital Expenditures" means with respect to the Borrower and its
Restricted Subsidiaries for any period, the aggregate cost of all Capital Assets
acquired by the Borrower and its Restricted Subsidiaries during such period, as
determined in accordance with GAAP.

         "Capital Lease" means any lease of any property by the Borrower or any
of its Restricted Subsidiaries, as lessee, that should, in accordance with GAAP,
be classified and accounted for as a capital lease on a Consolidated balance
sheet of the Borrower and its Subsidiaries.

         "Change in Control" has the meaning assigned thereto in Section
12.1(h).

         "Closing Date" means the date of this Agreement or such later Business
Day upon which each condition described in Section 6.2 shall be satisfied or
waived in all respects in a manner acceptable to the Agents, in their sole
discretion.

         "Code" means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended or modified from time to time.

         "Collateral" means the collateral security for the Obligations pledged
or granted pursuant to the Security Documents.

         "Collateral Agreement" means the amended and restated collateral
agreement of even date executed by the Borrower and each Restricted Domestic
Subsidiary in favor of the Administrative Agent for the ratable benefit of
itself and the Lenders, substantially in the form of Exhibit I, as further
amended, restated, supplemented or otherwise modified from time to time.

         "Collateral Assignment" means the amended and restated collateral
assignment agreement of even date herewith executed by the Borrower or any of
its Restricted Subsidiaries, as applicable, substantially in the form of Exhibit
K, in favor of the Administrative Agent for the ratable benefit of itself and
the Lenders, as further amended, restated or supplemented from time to time.

         "Commitment" means, as to any Lender, the sum of such Lender's
Revolving Credit Commitment and Term Loan Commitment, as set forth in the
Register, as the same may be reduced or modified at any time or from time to
time pursuant to the terms hereof.

          "Commitment Percentage" means, as to any Lender at any time, the ratio
of (a) the Sum of the Revolving Credit Commitment of such Lender and the
outstanding principal balance of the Term Loan of such Lender to (b) the sum of
the Revolving Credit Commitments of all Lenders and the outstanding principal
balance of the Term Loans of all Lenders.

         "Consolidated" means, when used with reference to financial statements
or financial statement items of the Borrower and its Subsidiaries, such
statements or items on a consolidated basis in accordance with applicable
principles of consolidation under GAAP.

                                        3



         "Credit Facility" means, collectively, the Revolving Credit Facility,
the Term Loan Facility, the Swingline Facility and the L/C Facility.

         "Debt" means, with respect to the Borrower and its Subsidiaries at any
date and without duplication, the sum of the following calculated in accordance
with GAAP: (a) all liabilities, obligations and indebtedness for borrowed money
including, but not limited to, obligations evidenced by bonds, debentures, notes
or other similar instruments of any such Person, (b) all obligations to pay the
deferred purchase price of property or services of any such Person (including,
without limitation, all obligations under non-competition agreements, except for
non-competition agreements in existence as of the Closing Date with Persons who
are employees of the Borrower or its Subsidiaries), except trade payables
arising in the ordinary course of business not more than ninety (90) days past
due or payable on such later date as is customary in the trade, (c) all
obligations of any such Person as lessee under Capital Leases, (d) all Debt of
any other Person secured by a Lien on any asset of the Borrower and its
Restricted Subsidiaries, (e) all Guaranty Obligations of any such Person, (f)
all obligations, contingent or otherwise, of any such Person relative to the
face amount of letters of credit, whether or not drawn, including, without
limitation, any Reimbursement Obligation, and banker's acceptances issued for
the account of any such Person, (g) all obligations of any such Person to
redeem, repurchase, exchange, defease or otherwise make payments in respect of
capital stock or other securities or partnership interests of such Person, (h)
all net payment obligations incurred by any such Person pursuant to Hedging
Agreements (which shall be deemed to be the Termination Value thereof as of the
date of calculation), to the extent such net payment obligations exceed
$1,000,000 on the date of determination, except for any net payment obligations
associated with any Non-Recourse Project Financing Indebtedness, (i) all
outstanding payment obligations with respect to Synthetic Leases and (j) the
outstanding attributed principal amount under any asset securitization program.

         "Default" means any of the events specified in Section 12.1 which with
the passage of time, the giving of notice or any other condition, would
constitute an Event of Default.

         "Disputes" shall have the meaning set forth in Section 14.6.

         "Dollar Amount" means (a) with respect to each Letter of Credit issued
or extended (or to be issued or extended), in Dollars, the principal amount
thereof and (b) with respect to each Alternative Currency Letter of Credit, the
amount of Dollars which is equivalent to the face amount of such Letter of
Credit, at the most favorable spot exchange rate determined by the Issuing
Lender at approximately 11:00 a.m. (local time at the office of the Issuing
Lender's Correspondent) two (2) Business Days before such Letter of Credit is
issued or extended (or to be issued or extended). When used with respect to any
other sum expressed in an Alternative Currency, "Dollar Amount" shall mean the
amount of Dollars which is equivalent to the amount so expressed in such
Alternative Currency at the most favorable spot exchange rate determined by the
applicable Issuing Lender to be available to it at the relevant time.

         "Dollars" or "$" means, unless otherwise qualified, dollars in lawful
currency of the United States.

         "Domestic Subsidiary" means any Subsidiary that is organized under the
laws of any political subdivision of the United States.

         "EBITDA" means, for any period, the sum of the following determined on
a Consolidated basis, without duplication, for the Borrower and its Restricted
Subsidiaries in accordance with GAAP: (a) Net Income for such period plus (b)
the sum of the following to the extent deducted in determining Net Income: (i)
income and franchise taxes, (ii) Interest Expense, (iii) amortization,
depreciation and other non-cash charges (including insurance reserves), and (iv)
extraordinary losses less (c) interest income and

                                        4



any extraordinary gains, including, but not limited to, any gain from the sale
of PCG; provided that, for purpose of calculating EBITDA, any start-up costs
incurred in connection with new facilities may, to the extent deducted in
determining Net Income, be amortized equally over a four (4) fiscal quarter
period (consisting of the fiscal quarter in which such costs were incurred and
expensed and the next three (3) succeeding fiscal quarters).

         "Eligible Assignee" means, with respect to any assignment of the
rights, interest and obligations of a Lender hereunder, a Person that is at the
time of such assignment (a) a commercial bank organized under the laws of the
United States or any state thereof, having combined capital and surplus in
excess of $500,000,000, (b) a commercial bank organized under the laws of any
other country that is a member of the Organization of Economic Cooperation and
Development, or a political subdivision of any such country, having combined
capital and surplus in excess of $500,000,000, (c) a finance company, insurance
company or other financial institution which in the ordinary course of business
extends credit of the type extended hereunder and that has total assets in
excess of $1,000,000,000, (d) already a Lender hereunder (whether as an original
party to this Agreement or as the assignee of another Lender), (e) the successor
(whether by transfer of assets, merger or otherwise) to all or substantially all
of the commercial lending business of the assigning Lender, (f) any Affiliate of
an assigning Lender or (g) any Approved Fund or (h) any other Person that has
been approved in writing as an Eligible Assignee by the Borrower (other than
upon the occurrence and during the continuance of any Default or Event of
Default) and the Administrative Agent.

         "Employee Benefit Plan" means any employee benefit plan within the
meaning of Section 3(3) of ERISA which (a) is maintained for employees of the
Borrower or any ERISA Affiliate or (b) has at any time within the preceding six
(6) years been maintained for the employees of the Borrower or any current or
former ERISA Affiliate.

         "EMU" means economic and monetary union as contemplated in the Treaty
on European Union.

         "EMU Legislation" means legislative measures of the Council of European
Union for the introduction of, change over to or operation of the euro.

         "Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, accusations,
allegations, notices of noncompliance or violation, investigations (other than
internal reports prepared by any Person in the ordinary course of business and
not in response to any third party action or request of any kind) or proceedings
relating in any way to any actual or alleged violation of or liability under any
Environmental Law or relating to any permit issued, or any approval given, under
any such Environmental Law, including, without limitation, any and all claims by
Governmental Authorities for enforcement, cleanup, removal, response, remedial
or other actions or damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to human health or the environment.

         "Environmental Laws" means any and all federal, foreign, state,
provincial and local laws, statutes, ordinances, rules, regulations, permits,
licenses, approvals, and orders of courts or Governmental Authorities, relating
to the protection of human health or the environment, including, but not limited
to, requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials.

         "ERISA" means the Employee Retirement Income Security Act of 1974, and
the rules and regulations thereunder, each as amended or modified from time to
time.

                                        5



         "ERISA Affiliate" means any Person who together with the Borrower is
treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Code or Section 4001(b) of ERISA.

         "euro" means the single currency to which the Participating Member
States of the European Union have converted.

         "Eurodollar Reserve Percentage" means, for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including, without limitation, any basic, supplemental or emergency reserves)
in respect of eurocurrency liabilities or any similar category of liabilities
for a member bank of the Federal Reserve System in New York City.

         "Event of Default" means any of the events specified in Section 12.1,
provided that any requirement for passage of time, giving of notice, or any
other condition, has been satisfied.

         "Excess Cash Flow" means, for any period, the sum of the following
determined on a Consolidated basis, without duplication, for the Borrower and
its Restricted Subsidiaries in accordance with GAAP: (a) EBITDA minus (b)
Interest Expense paid in cash minus (c) cash taxes, (d)(i) minus any increases
in working capital or (ii) plus any decreases in working capital minus (e)
Capital Expenditures to the extent paid in cash, minus (f) all scheduled
amortization payments made and optional prepayments with respect to the Term
Loan Facility.

         "Excess Proceeds" shall have the meaning assigned thereto in Section
2.6(b).

         "Existing Facility" has the meaning given to that term in the Statement
of Purpose hereof.

         "Extensions of Credit" means, as to any Lender at any time, (a) an
amount equal to the sum of (i) the aggregate principal amount of all Revolving
Credit Loans made by such Lender then outstanding, (ii) such Lender's Revolving
Credit Commitment Percentage of the L/C Obligations then outstanding, (iii) such
Lender's Revolving Credit Commitment Percentage of the Swingline Loans then
outstanding and (iv) the aggregate principal amount of all Term Loans made by
such Lender then outstanding, or (b) the making of any Loan or participation in
any Letter of Credit by such Lender, as the context requires.

         "FDIC" means the Federal Deposit Insurance Corporation, or any
successor thereto.

         "Federal Funds Rate" means, the rate per annum (rounded upwards, if
necessary, to the next higher 1/100th of 1%) representing the daily effective
federal funds rate as quoted by the Administrative Agent and confirmed in
Federal Reserve Board Statistical Release H.15 (519) or any successor or
substitute publication selected by the Administrative Agent. If, for any reason,
such rate is not available, then "Federal Funds Rate" shall mean a daily rate
which is determined, in the reasonable opinion of the Administrative Agent, to
be the rate at which federal funds are being offered for sale in the national
federal funds market at 9:00 a.m. (New York time). Rates for weekends or
holidays shall be the same as the rate for the most immediately preceding
Business Day.

         "Fiscal Year" means the fiscal year of the Borrower and its
Subsidiaries ending on the last Sunday closest to calendar year end.

         "Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.

                                        6



         "GAAP" means generally accepted accounting principles, as recognized by
the American Institute of Certified Public Accountants and the Financial
Accounting Standards Board, consistently applied and maintained on a consistent
basis for the Borrower and its Subsidiaries throughout the period indicated and
(subject to Section 14.9) consistent with the prior financial practice of the
Borrower and its Subsidiaries.

         "Government Contract" means a contract between the Borrower or any
Restricted Subsidiary and an agency, department or instrumentality of the United
States or any state, municipal or local Governmental Authority located in the
United States or all obligations of any such Governmental Authority arising
under any Account (as defined in the UCC) now or hereafter owing by any
Governmental Authority, as account debtor, to the Borrower or any Restricted
Subsidiary.

         "Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

         "Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.

         "Guarantors" means the Restricted Domestic Subsidiaries (other than
WIH) and any other Person which, after the Closing Date, becomes a party to the
Guaranty Agreement by executing and delivering a Joinder Agreement.

         "Guaranty Agreement" means the unconditional amended and restated
guaranty agreement of even date executed by the Guarantors in favor of the
Administrative Agent for the ratable benefit of itself and the Lenders,
substantially in the form of Exhibit H, as further amended, restated,
supplemented or otherwise modified from time to time.

         "Guaranty Obligation" means, with respect to the Borrower and its
Subsidiaries, without duplication, any obligation, contingent or otherwise, of
any such Person pursuant to which such Person has directly or indirectly
guaranteed any Debt or other financial obligation of any other Person and,
without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of any such Person (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt or other
obligation (whether arising by virtue of partnership arrangements, by agreement
to keep well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement condition or otherwise) or (b) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided, that the term Guaranty
Obligation shall not include endorsements for collection or deposit in the
ordinary course of business.

         "G4" means Group 4 Falck A/S, a Denmark corporation, and its
successors.

         "Hazardous Materials" means any substances or materials (a) which are
or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Environmental Law, (b) which are toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human
health or the environment and are or become regulated by any Governmental
Authority, (c) the presence of which require investigation or remediation under
any Environmental Law or common law, (d) the discharge or emission or release of
which requires a permit or license under any Environmental Law or other
Governmental Approval, (e) which are deemed to constitute a nuisance or a
trespass which pose a health or safety hazard

                                        7



to Persons or neighboring properties, (f) which consist of underground or
aboveground storage tanks, whether empty, filled or partially filled with any
substance, or (g) which contain, without limitation, asbestos, polychlorinated
biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum
derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic
gas.

         "Hedging Agreement" means any agreement with respect to any Interest
Rate Contract, forward rate agreement, commodity swap, forward foreign exchange
agreement, currency swap agreement, cross-currency rate swap agreement, currency
option agreement or other agreement or arrangement designed to alter the risks
of any Person arising from fluctuations in interest rates, currency values or
commodity prices, all as amended, restated, supplemented or otherwise modified
from time to time.

         "Hedging Obligations" has the meaning assigned thereto in the
definition of "Obligations".

         "High-Yield Notes" means $150,000,000 8 1/4% senior unsecured
high-yield notes due 2013 issued by the Borrower on the Closing Date.

         "High-Yield Note Indenture" means the Indenture under which the
High-Yield Notes are issued.

         "Insurance and Condemnation Proceeds" has the meaning assigned thereto
in Section 4.4(b)(iv).

         "Interest Expense" means, with respect to the Borrower and its
Restricted Subsidiaries (other than with respect to any Non-Recourse Project
Financing Indebtedness) for any period, the gross interest expense (including,
without limitation, interest expense attributable to Capital Leases, Synthetic
Leases (which shall be treated the same as Capital Leases for purposes of this
definition) and all net payment obligations pursuant to Hedging Agreements), all
determined for such period on a Consolidated basis, without duplication, in
accordance with GAAP except as expressly provided in this definition.

         "Interest Period" has the meaning assigned thereto in Section 5.1(b).

         "Interest Rate Contract" means any interest rate swap agreement,
interest rate cap agreement, interest rate floor agreement, interest rate collar
agreement, interest rate option or any other agreement regarding the hedging of
interest rate risk exposure executed in connection with hedging the interest
rate exposure of any Person and any confirming letter executed pursuant to such
agreement, all as amended, restated, supplemented or otherwise modified from
time to time.

         "ISP98" means the International Standby Practices (1998 Revision,
effective January 1, 1999), International Chamber of Commerce Publication No.
590.

         "Issuing Lender" means BNP Paribas, in its capacity as issuer of any
Letter of Credit, or any successor thereto, or any other Lender to whom any
portion of the L/C Commitment is assigned in the case where the Issuing Lender
is not able to issue the requested Letter of Credit.

         "Issuing Lender's Correspondent" means BNP Paribas, New York Branch, or
any other financial institution designated by the Issuing Lender to act as its
correspondent hereunder with respect to the issuance and payment of Alternative
Currency Letters of Credit.

         "Joinder Agreement" means collectively, each joinder agreement executed
in favor of the Administrative Agent for the ratable benefit of itself and the
Lenders, substantially in the form of Exhibit J.

                                        8



         "L/C Commitment" means the lesser of (a) Forty Million Dollars
($40,000,000) and (b) the Revolving Credit Commitments of all Lenders.

         "L/C Facility" means the letter of credit facility established pursuant
to Article III.

         "L/C Obligations" means at any time, an amount equal to the sum of (a)
the aggregate undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit which
have not then been reimbursed pursuant to Section 3.5.

         "L/C Participants" means the collective reference to all the Lenders
with Revolving Credit Commitments other than the Issuing Lender.

         "Lender" means each Person executing this Agreement as a Lender
(including, without limitation, the Issuing Lender and the Swingline Lender
unless the context otherwise requires) set forth on the signature pages hereto
and each Person that hereafter becomes a party to this Agreement as a Lender
pursuant to Section 14.10.

         "Lending Office" means, with respect to any Lender, the office of such
Lender maintaining such Lender's Revolving Credit Commitment Percentage or Term
Loan Percentage, as applicable, of the Extensions of Credit.

         "Letters of Credit" shall have the meaning assigned thereto in Section
3.1.

         "LIBOR" means the rate of interest per annum determined on the basis of
the rate for deposits in Dollars in an amount equal to the amount of the Loan
requested by the Borrower for a period equal to the applicable Interest Period
which appears on the Dow Jones Market Screen 3750 at approximately 11:00 a.m.
(London time) two (2) Business Days prior to the first day of the applicable
Interest Period (rounded upward, if necessary, to the nearest 1/100th of 1%).
If, for any reason, such rate does not appear on Dow Jones Market Screen 3750,
then "LIBOR" shall be determined by the Administrative Agent to be the
arithmetic average of the rate per annum at which deposits in Dollars in an
amount equal to the amount of the Loan requested by the Borrower would be
offered by first class banks in the London interbank market to the
Administrative Agent at approximately 11:00 a.m. (London time) two (2) Business
Days prior to the first day of the applicable Interest Period for a period equal
to such Interest Period. Each calculation by the Administrative Agent of LIBOR
shall be conclusive and binding for all purposes, absent manifest error.

         "LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to
the next higher 1/100th of 1%) determined by the Administrative Agent pursuant
to the following formula:

         LIBOR Rate =                       LIBOR
                      -------------------------------------------------
                             1.00-Eurodollar Reserve Percentage

         "LIBOR Rate Loan" means any Loan bearing interest at a rate based upon
the LIBOR Rate as provided in Section 5.1(a).

         "Lien" means, with respect to any asset, any mortgage, leasehold
mortgage, lien, pledge, charge, security interest, hypothecation or encumbrance
of any kind in respect of such asset. For the purposes of this Agreement, a
Person shall be deemed to own subject to a Lien any asset which it has acquired
or holds subject to the interest of a vendor or lessor under any conditional
sale agreement, Capital Lease or other title retention agreement relating to
such asset.

                                        9



         "Loan Documents" means, collectively, this Agreement, the Notes, the
Applications, the Security Documents, each Joinder Agreement and each other
document, instrument, certificate and agreement executed and delivered by the
Borrower or any Subsidiary thereof in connection with this Agreement (excluding
any Hedging Agreement), all as may be amended, restated, supplemented or
otherwise modified from time to time.

         "Loans" means the collective reference to the Revolving Credit Loans,
the Term Loans and the Swingline Loans and "Loan" means any of such Loans.

         "Material Adverse Effect" means, with respect to the Borrower or any of
its Restricted Subsidiaries, a material adverse effect on the properties,
business, operations or condition (financial or otherwise) of any such Person or
the ability of any such Person to perform its obligations under any Loan
Document in each case to which it is a party.

         "Material Contract" means (a) any Material Government Contract or (b)
any other contract or agreement, written or oral, of the Borrower or any of its
Restricted Subsidiaries the failure to comply with which could reasonably be
expected to have a Material Adverse Effect.

         "Material Government Contract" means any Government Contract which
produces revenues to the Borrower or any Restricted Subsidiary in an amount in
excess of $3,000,000 per annum.

         "Moody's" means Moody's Investors Service, Inc.

         "Mortgages" means the collective reference to each deed of trust,
mortgage or other real property security document, encumbering all real property
now or hereafter owned by the Borrower or any Restricted Domestic Subsidiary, in
each case, in form and substance reasonably satisfactory to the Administrative
Agent and executed by the Borrower or any Restricted Domestic Subsidiary thereof
in favor of the Administrative Agent, for the ratable benefit of itself and the
Lenders, as any such document may be amended, restated, supplemented or
otherwise modified from time to time.

         "Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or
is accruing an obligation to make, or has accrued an obligation to make
contributions within the preceding six (6) years.

         "Net Cash Proceeds" means, as applicable, (a) with respect to any sale
or other disposition of assets, the gross cash proceeds received by the Borrower
or any of its Restricted Subsidiaries from such sale less the sum of (i) all
income taxes and other taxes assessed by a Governmental Authority as a result of
such sale and any other fees and expenses (including legal, brokerage,
consulting and accounting fees and expenses) incurred in connection therewith
and (ii) the principal amount of, premium, if any, and interest on any Debt
secured by a Lien on the asset (or a portion thereof) sold, which Debt is
required to be repaid in connection with such sale, (b) with respect to any
offering of equity securities or issuance of Debt, the gross cash proceeds
received by the Borrower or any of its Restricted Subsidiaries therefrom less
all legal, underwriting and other fees and expenses incurred in connection
therewith and (c) with respect to any payment under an insurance policy or in
connection with a condemnation proceeding, the amount of cash proceeds received
by the Borrower or its Restricted Subsidiaries from an insurance company or
Governmental Authority, as applicable, net of all expenses of collection.

         "Net Income" means, with respect to the Borrower and its Subsidiaries,
for any period of determination, the net income (or loss) for such period,
determined on a Consolidated basis in accordance with GAAP; provided that there
shall be excluded from Net Income (a) the net income (or loss) of any Person, in
which the Borrower or any of its Restricted Subsidiaries has a joint interest
with a third party,

                                       10



except to the extent such net income is actually paid to the Borrower or any of
its Restricted Subsidiaries by dividend or other distribution during such period
(in an amount not to exceed the Borrower's or such Restricted Subsidiary's share
(pro rata to its equity interest in such Person) of the net income of such
Person), (b) the net income (or loss) of any Person accrued prior to the date it
becomes a Subsidiary of such Person or is merged into or consolidated with such
Person or any of its Restricted Subsidiaries or that Person's assets are
acquired by such Person or any of its Restricted Subsidiaries except to the
extent included pursuant to the foregoing clause (a), and (c) the net income of
any Unrestricted Subsidiary, except to the extent such net income is actually
paid to the Borrower or any of its Restricted Subsidiaries by dividend or
distribution during such period (in an amount not to exceed the Borrower's or
any Restricted Subsidiary's share (pro rata to its equity interest in such
Unrestricted Subsidiary) of the net income of such Unrestricted Subsidiary).

         "Net Worth" means the shareholders' equity (including preferred stock)
of the Borrower and its Restricted Subsidiaries determined on a Consolidated
basis in accordance with GAAP.

         "Non-Recourse Project Financing Indebtedness" means any Indebtedness of
a Restricted Subsidiary (the "Project Financing Subsidiary") incurred in
connection with the acquisition, construction or development of any facility;

         (1) where such Project Financing Subsidiary operates or is responsible
for the operation of the facility pursuant to a management services contract
with a governmental entity;

         (2) as to which neither the Borrower nor any of its Restricted
Subsidiaries, other than such Project Financing Subsidiary, (a) provides credit
support of any kind (including any undertaking, agreement or instrument that
would constitute Indebtedness), it being understood that equity investments
funded at the time of or prior to the incurrence of such Indebtedness shall not
be deemed credit support or (b) is directly or indirectly liable as a guarantor
or otherwise;

         (3) where, upon the termination of the management services contract
with respect to such facility, neither the Borrower nor any of its Restricted
Subsidiaries, other than the Project Financing Subsidiary, will be liable,
directly or indirectly, to make any payments with respect to such Indebtedness
(or portions thereof);

         (4) the interest expense related to such Indebtedness is fully serviced
by a separate corresponding payment with respect to such Indebtedness pursuant
to an agreement with the governmental entity; and

         (5) such Project Financing Subsidiary has no assets other than the
assets, including working capital, reasonably related to the design,
construction, management and financing of the facility.

         "Notes" means the collective reference to the Revolving Credit Notes,
the Term Notes and the Swingline Note, and "Note" means any of such Notes.

         "Notice of Account Designation" shall have the meaning assigned thereto
in Section 2.3(b).

         "Notice of Borrowing" shall have the meaning assigned thereto in
Section 2.3(a).

         "Notice of Conversion/Continuation" shall have the meaning assigned
thereto in Section 5.2.

         "Notice of Prepayment" shall have the meaning assigned thereto in
Section 2.4(c).

                                       11



         "Obligations" means, in each case, whether now in existence or
hereafter arising: (a) the principal of and interest on (including interest
accruing after the filing of any bankruptcy or similar petition) the Loans, (b)
the L/C Obligations, (c) all existing or future payment and other obligations
owing by the Borrower under any Hedging Agreement (which such Hedging Agreement
is permitted hereunder) with any Person that is a Lender hereunder at the time
such Hedging Agreement is executed (all such obligations with respect to any
such Hedging Agreement, "Hedging Obligations") and (d) all other fees and
commissions (including reasonable attorneys' fees), charges, indebtedness,
loans, liabilities, financial accommodations, obligations, covenants and duties
owing by the Borrower or any of its Subsidiaries to the Lenders or the
Administrative Agent, in each case under or in respect of this Agreement, any
Note, any Letter of Credit or any of the other Loan Documents of every kind,
nature and description, direct or indirect, absolute or contingent, due or to
become due, contractual or tortious, liquidated or unliquidated, and whether or
not evidenced by any note.

         "Officer's Compliance Certificate" shall have the meaning assigned
thereto in Section 8.2.

         "Operating Lease" shall mean, as to any Person as determined in
accordance with GAAP, any lease of property (whether real, personal or mixed) by
such Person as lessee which is not a Capital Lease.

         "Other Taxes" shall have the meaning assigned thereto in Section
5.11(b).

         "Parent Shares" means the shares of capital stock of the Borrower held
immediately prior to the Closing Date by G4 or an entity owned or controlled by
G4.

         "Participating Member State" means each state so described in any EMU
Legislation.

         "PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.

         "PCG" means Premier Custodial Group Limited, a company organized under
the laws of England, and its successors.

         "Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or
Section 412 of the Code and which (a) is maintained for the employees of the
Borrower or any ERISA Affiliates or (b) has at any time within the preceding six
(6) years been maintained for the employees of the Borrower or any of its
current or former ERISA Affiliates.

         "Permitted Acquisition" means an acquisition using that portion of (a)
Net Cash Proceeds from the sale or other disposition of assets owned by the
Borrower or any of its Restricted Subsidiaries or the offering of equity
securities by the Borrower or any of its Restricted Subsidiaries and/or (b)
Excess Cash Flow and/or cash on hand, in each case to the extent not required to
be used to make prepayments pursuant to Section 4.4(b), provided that: (i)
EBITDA for the two fiscal years immediately preceding the date of such
acquisition, calculated on a pro forma basis as if the acquisition had been made
on the first day of such period, would be positive, all as calculated by the
Borrower in reasonable detail and reviewed and approved by the Administrative
Agent, (ii) the Total Leverage Ratio and Senior Secured Leverage Ratio for the
four most recently completed fiscal quarters for which financial statements are
available, calculated on a pro forma basis as if the acquisition had been made
on the first day of such period, would be at least 0.50 below the then
applicable Total Leverage Ratio and Senior Secured Leverage Ratio, respectively,
(iii) such acquisition shall be of at least a 50% ownership interest in a
business or a line of business (whether by the acquisition of common stock,
assets or any combination thereof) of any other Person that is in the same line
of business as the business of the Borrower and its Restricted Subsidiaries on
the Closing Date or a business reasonably related thereto or ancillary or
incidental thereto or a

                                       12



reasonable extension thereof, including the privatization of governmental
services (a "Permitted Business"); and (iv) if any such acquisition (A) is in
excess of $20,000,000 plus the Net Cash Proceeds from the offering of equity
securities of the Borrower or any of its Restricted Subsidiaries not required to
be used for prepayments under Section 4.4(b)(ii) (provided that such Net Cash
Proceeds are designated for Permitted Acquisitions), or (B) when added to all
such acquisitions made after the Closing Date, is in an aggregate amount in
excess of $30,000,000 plus the Net Cash Proceeds from the offering of equity
securities of the Borrower or any of its Restricted Subsidiaries not required to
be used for prepayments under Section 4.4(b)(ii) (provided that such Net Cash
Proceeds are designated for Permitted Acquisitions) (collectively, the
"Permitted Acquisition Basket"), then such acquisition shall require the consent
of the Required Lenders (provided that any acquisition to which the Required
Lenders consent shall not be considered usage of the Permitted Acquisition
Basket).

         "Permitted Business" shall have the meaning assigned thereto under the
definition "Permitted Acquisition".

         "Permitted Currency" means Dollars or any Alternative Currency, or each
such currency, as the context requires.

         "Person" means an individual, corporation, limited liability company,
partnership, association, trust, business trust, joint venture, joint stock
company, pool, syndicate, sole proprietorship, unincorporated organization,
Governmental Authority or any other form of entity or group thereof.

         "PIK Preferred Stock" shall mean preferred stock or other junior
securities of the Borrower that (a) require dividends or interest to be
"paid-in-kind" by the issuance of like preferred stock or other junior
securities and do not require cash dividends or interest to be paid, in each
case, issued on terms and conditions acceptable to the Agents and (b) are not
convertible or exchangeable into Debt or required to be redeemed or repurchased
before the Term Loan Maturity Date.

         "Pounds Sterling" means, at any time of determination, the then
official currency of the United Kingdom of Great Britain and Northern Ireland.

         "Prime Rate" means, at any time, the rate of interest per annum
publicly announced from time to time by BNP Paribas as its prime rate. Each
change in the Prime Rate shall be effective as of the opening of business on the
day such change in such prime rate occurs. The parties hereto acknowledge that
the rate announced publicly by BNP Paribas as its prime rate is an index or base
rate and shall not necessarily be its lowest or best rate charged to its
customers or other banks.

         "Purchasing Lender" shall have the meaning assigned thereto in Section
14.10(b).

         "Register" shall have the meaning assigned thereto in Section 14.10(d).

         "Reimbursement Obligation" means the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit.

         "Rental Expense" means, with respect to the Borrower and its Restricted
Subsidiaries for any period, all rent expense paid in cash with respect to
long-term real property leases during such period, determined on a Consolidated
basis in accordance with GAAP.

         "Required Lenders" means, at any date, any combination of Lenders whose
Commitment Percentages aggregate more than fifty percent (50%) or, if the Credit
Facility has been terminated

                                       13



pursuant to Section 12.2, any combination of Lenders holding more than fifty
percent (50%) of the aggregate Extensions of Credit.

         "Responsible Officer" means any of the following: the chief executive
officer, chief financial officer or treasurer of the Borrower or any other
officer of the Borrower designated by the chief executive officer, the chief
financial officer or treasurer and reasonably acceptable to the Agents.

         "Restricted Payments" means (a) any direct or indirect distribution,
dividend or other payment to any Person (other than to the Borrower or any of
its Restricted Subsidiaries) on account of any capital stock or other ownership
interests of the Borrower or any of its Subsidiaries (other than dividends
payable solely in capital stock or other ownership interests of such Person and
splits thereof), (b) the purchase, redemption, retirement or other acquisition,
whether direct or indirect, of any shares of the Borrower's or its Restricted
Subsidiaries' capital stock or other ownership interests, (c) any distribution
of cash, property or assets among the holders of shares of the Borrower's or any
of its Restricted Subsidiaries' capital stock or other ownership interests, (d)
any cash interest payments with respect to Subordinated Debt, or (e) any change
in the Borrower's or any Restricted Subsidiary's capital structure (except for
any exchanges by the Borrower of common stock for PIK Preferred Stock with any
of its existing stockholders; provided no Default or Event of Default is
continuing or would result from such exchange).

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

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

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

         "Revolving Credit Commitment" means (a) as to any Lender, the
obligation of such Lender to make Revolving Credit Loans to the account of the
Borrower hereunder in an aggregate principal amount at any time outstanding not
to exceed the amount set forth in the Register, as such amount may be reduced or
modified at any time or from time to time pursuant to the terms hereof and (b)
as to all Lenders, the aggregate commitment of all Lenders to make Revolving
Credit Loans, as such amount may be reduced at any time or from time to time
pursuant to the terms hereof. The Revolving Credit Commitment of all Lenders on
the Closing Date shall be $50,000,000.

         "Revolving Credit Commitment Percentage" means, as to any Lender at any
time, the ratio of (a) the amount of the Revolving Credit Commitment of such
Lender to (b) the Revolving Credit Commitments of all Lenders.

         "Revolving Credit Facility" means the revolving credit facility
established pursuant to Article II.

         "Revolving Credit Loan" means any revolving loan made to the Borrower
pursuant to Section 2.1, and all such revolving loans collectively as the
context requires.

         "Revolving Credit Maturity Date" means the earliest of the dates
referred to in Section 2.7.

         "Revolving Credit Notes" means the collective reference to the
Revolving Credit Notes made by the Borrower payable to the order of each Lender
holding a Revolving Credit Commitment, substantially in the form of Exhibit A-1
hereto, evidencing the Revolving Credit Facility, and any amendments,

                                       14



supplements and modifications thereto, any substitutes therefor, and any
replacements, restatements, renewals or extension thereof, in whole or in part.

         "Securities Act" means the Securities Act of 1933, including all
amendments thereto and regulations promulgated thereunder.

         "Security Documents" means the collective reference to the Guaranty
Agreement, the Collateral Agreement, the Mortgages, the Collateral Assignment
and each other agreement or writing pursuant to which the Borrower or any
Restricted Subsidiary thereof purports to pledge or grant a security interest in
any property or assets securing the Obligations or any such Person purports to
guaranty the payment and/or performance of the Obligations, in each case, as
amended, restated, supplemented or otherwise modified from time to time.

         "Senior Secured Leverage Ratio" shall have the meaning assigned thereto
in Section 10.1(b).

         "Senior Unsecured Debt" means (a) the High-Yield Notes or (b) the
$150,000,000 senior unsecured term loan made to the Borrower by BNP Paribas and
other lenders on the Closing Date.

         "Share Purchase" means the purchase of 12,000,000 shares of common
stock of the Borrower from G4 for a purchase price not to exceed $132,000,000.

         "Solvent" means, as to the Borrower and its Restricted Subsidiaries on
a particular date, that any such Person (a) has capital sufficient to carry on
its business and transactions and all business and transactions in which it is
about to engage and is able to pay its debts as they mature, and (b) owns
property having a value, both at fair valuation and at present fair saleable
value, greater than the amount required to pay its probable liabilities
(including contingencies).

         "South African Rand" means, at any time of determination, the then
official currency of South Africa.

         "Subordinated Debt" means the collective reference to any Debt of the
Borrower or any Restricted Subsidiary subordinated in right and time of payment
to the Obligations and containing such other terms and conditions (including,
without limitation, subordination terms), in each case as are satisfactory to
the Required Lenders.

         "Subsidiary" means as to any Person, any corporation, partnership,
limited liability company or other entity of which more than fifty percent (50%)
of the outstanding capital stock or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other managers of
such corporation, partnership, limited liability company or other entity is at
the time owned by or the management is otherwise controlled directly or
indirectly by such Person, or one or more of the Subsidiaries of such Person, or
a combination thereof (irrespective of whether, at the time, capital stock or
other ownership interests of any other class or classes of such corporation,
partnership, limited liability company or other entity shall have or might have
voting power by reason of the happening of any contingency). Unless otherwise
qualified references to "Subsidiary" or "Subsidiaries" herein shall refer to
those of the Borrower.

         "Survey Affidavit" shall have the meaning assigned thereto in Section
6.2(c).

         "Swingline Commitment" means the lesser of (a) Five Million Dollars
($5,000,000) and (b) the Revolving Credit Commitment.

                                       15



         "Swingline Facility" means the swingline facility established pursuant
to Section 2.2.

         "Swingline Lender" means BNP Paribas in its capacity as swingline
lender hereunder.

         "Swingline Loan" means any swingline loan made by the Swingline Lender
to the Borrower pursuant to Section 2.2, and all such swingline loans
collectively as the context requires.

         "Swingline Note" means the Swingline Note made by the Borrower payable
to the order of the Swingline Lender, substantially in the form of Exhibit A-2
hereto, evidencing the Swingline Loans, and any amendments, supplements and
modifications thereto, any substitutes therefor, and any replacements,
restatements, renewals or extensions thereof, in whole or in part.

         "Swingline Termination Date" means the first to occur of (a) the
resignation of BNP Paribas as Administrative Agent in accordance with Section
13.9 or (b) the Revolving Credit Maturity Date.

         "Syndication Agent" means BNP Paribas in its capacity as syndication
agent hereunder.

         "Synthetic Lease" means any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product
where such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an Operating Lease in accordance with GAAP.

         "S&P" means Standard & Poor's Rating Services, a division of The
McGraw-Hill Companies.

         "Taxes" shall have the meaning assigned thereto in Section 5.11(a).

         "Term Loan Commitment" means (a) as to any Lender, the obligation of
such Lender to extend the Term Loans to the account of the Borrower hereunder in
an aggregate principal amount not to exceed the amount set forth in the
Register, as such amount may be reduced or otherwise modified at any time or
from time to time pursuant to the terms hereof and (b) as to all Lenders, the
aggregate commitment to extend the Term Loans. The Term Loan Commitment of all
Lenders as of the Closing Date shall be $100,000,000.

         "Term Loan Facility" shall mean the term loan facility established
pursuant to Article IV.

         "Term Loan Maturity Date" means the first to occur of (a) July 9, 2009,
or (b) the date of termination by the Administrative Agent on behalf of the
Lenders pursuant to Section 12.2(a).

         "Term Loan Percentage" means, as to any Lender, the ratio of (a) the
outstanding principal balance of the Term Loan of such Lender to (b) the
aggregate outstanding principal balance of the Term Loans of all Lenders.

         "Term Loans" shall mean the term loans made to the Borrower by the
Lenders pursuant to Section 4.1.

         "Term Notes" means the collective reference to the Term Notes made by
the Borrower payable to the order of each Lender holding a Term Loan Commitment,
substantially in the form of Exhibit A-3 hereto, evidencing the Term Loan
Facility, and any amendments, modifications and supplements thereto, any
substitute therefor, and any replacement, restatements, renewals or extensions
thereof, in whole or in part.

                                       16



         "Termination Event" means except for any such event or condition that
could not reasonably be expected to have a Material Adverse Effect: (a) a
"Reportable Event" described in Section 4043 of ERISA for which the notice
requirement has not been waived by the PBGC, or (b) the withdrawal of the
Borrower or any ERISA Affiliate from a Pension Plan during a plan year in which
it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA, or
(c) the termination of a Pension Plan, the filing of a notice of intent to
terminate a Pension Plan or the treatment of a Pension Plan amendment as a
termination, under Section 4041 of ERISA, if the plan assets are not sufficient
to pay all plan liabilities, or (d) the institution of proceedings to terminate,
or the appointment of a trustee with respect to, any Pension Plan by the PBGC,
or (e) any other event or condition which would constitute grounds under Section
4042(a) of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan, or (f) the imposition of a Lien pursuant to
Section 412 of the Code or Section 302 of ERISA, or (g) the partial or complete
withdrawal of the Borrower of any ERISA Affiliate from a Multiemployer Plan if
withdrawal liability is asserted by such plan, or (h) any event or condition
which results in the reorganization or insolvency of a Multiemployer Plan under
Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA or the
institution by PBGC of proceedings to terminate a Multiemployer Plan under
Section 4042 of ERISA.

         "Termination Value" means, in respect of any one or more Hedging
Agreements, after taking into account the effect of any legally enforceable
netting agreement relating to such Hedging Agreements, (a) for any date on or
after the date such Hedging Agreements have been closed out and termination
value(s) determined in accordance therewith, such termination value(s), and (b)
for any date prior to the date referenced in clause (a), the amount(s)
determined as the mark-to-market value(s) for such Hedging Agreements, as
determined based upon one or more mid-market or other readily available
quotations provided by any recognized dealer in such Hedging Agreements (which
may include a Lender or any Affiliate of a Lender).

         "Total Leverage Ratio" shall have the meaning assigned thereto in
Section 10.1(a).

         "Treaty on European Union" means the Treaty of Rome of March 25, 1957,
as amended by the Single European Act of 1986 and the Maastricht Treaty (signed
February 7, 1992), as amended from time to time.

         "UCC" means the Uniform Commercial Code as in effect in the State of
New York, as amended or modified from time to time.

         "Uniform Customs" means the Uniform Customs and Practice for
Documentary Credits (1993 Revision), effective January, 1994 International
Chamber of Commerce Publication No. 500.

         "United States" means the United States of America.

         "Unrestricted Subsidiary" means any Subsidiary of the Borrower listed
on Schedule 1.1(a) or which is designated as an Unrestricted Subsidiary after
the Closing Date pursuant to Section 9.11, provided that (a) such Unrestricted
Subsidiary's obligations are non-recourse to the Borrower and its Subsidiaries
and (b) such Unrestricted Subsidiary meets the requirements set forth in Section
9.11.

         "Wholly-Owned" means, with respect to a Subsidiary, that all of the
shares of capital stock or other ownership interests of such Subsidiary are,
directly or indirectly, owned or controlled by the Borrower and/or one or more
of its Wholly-Owned Subsidiaries (except for directors' qualifying shares or
other shares required by Applicable Law to be owned by a Person other than the
Borrower).

                                       17



         "WIH" means WCC International Holdings, Inc., a Delaware corporation,
and its successors.

         SECTION 1.2 General. Unless otherwise specified, a reference in this
Agreement to a particular article, section, subsection, Schedule or Exhibit is a
reference to that article, section, subsection, Schedule or Exhibit of this
Agreement. Wherever from the context it appears appropriate, each term stated in
either the singular or plural shall include the singular and plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter. Any reference herein to "New York time"
shall refer to the applicable time of day in New York, New York.

         SECTION 1.3 Other Definitions and Provisions.

         (a)      Use of Capitalized Terms. Unless otherwise defined therein,
all capitalized terms defined in this Agreement shall have the defined meanings
when used in this Agreement, the Notes and the other Loan Documents or any
certificate, report or other document made or delivered pursuant to this
Agreement.

         (b)      Miscellaneous. The words "hereof", "herein" and "hereunder"
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.

         (c)      Plural and Singular. The meanings of defined terms are equally
applicable to the singular and plural forms of the defined terms.

         SECTION 1.4 Effectiveness of Euro Provisions. With respect to any state
(or the currency of such state) that is not a Participating Member State on the
date of this Agreement, the provisions of Sections 3.8(a), 3.8(b) and 3.11 shall
become effective in relation to such state (and the currency of such state) at
and from the date on which such state becomes a Participating Member State.

         SECTION 1.5 Currency Equivalents.

         (a)      For purposes of Articles II, III and IV, the applicable
outstanding amount of Letters of Credit and L/C Obligations shall be deemed to
refer to the Dollar Amount thereof.

         (b)      All Loans made under this Agreement, including, without
limitation, Loans made to refund drawings made under Alternative Currency
Letters of Credit, shall be made only in Dollars.

                                   ARTICLE II

                            REVOLVING CREDIT FACILITY

         SECTION 2.1 Revolving Credit Loans. Subject to the terms and conditions
of this Agreement, and in reliance upon the representations and warranties set
forth herein, each Lender severally agrees to make Revolving Credit Loans to the
Borrower from time to time from the Closing Date through, but not including, the
Revolving Credit Maturity Date as requested by the Borrower in accordance with
the terms of Section 2.3; provided, that (a) the aggregate principal amount of
all outstanding Revolving Credit Loans (after giving effect to any amount
requested) shall not exceed the Revolving Credit Commitment less the sum of all
outstanding Swingline Loans and L/C Obligations and (b) the principal amount of
outstanding Revolving Credit Loans from any Lender to the Borrower shall not at
any time exceed such Lender's Revolving Credit Commitment less such Lender's
Revolving Credit Commitment Percentage of outstanding L/C Obligations and
outstanding Swingline Loans. Each Revolving Credit Loan by a Lender shall be in
a principal amount equal to such Lender's Revolving Credit Commitment Percentage
of the

                                       18



aggregate principal amount of Revolving Credit Loans requested on such occasion.
Subject to the terms and conditions hereof, the Borrower may borrow, repay and
reborrow Revolving Credit Loans hereunder until the Revolving Credit Maturity
Date.

         SECTION 2.2 Swingline Loans.

         (a)      Availability. Subject to the terms and conditions of this
Agreement, the Swingline Lender agrees to make Swingline Loans to the Borrower
from time to time from the Closing Date through, but not including, the
Swingline Termination Date; provided, that the aggregate principal amount of all
outstanding Swingline Loans (after giving effect to any amount requested), shall
not exceed the lesser of (i) the Revolving Credit Commitment less the sum of all
outstanding Revolving Credit Loans and the L/C Obligations and (ii) the
Swingline Commitment. If the Swingline Lender has received notice (by telephone
or in writing) from the Administrative Agent (including at the request of any
Lender) at least one hour before the making of any Swingline Loan (A) directing
the Swingline Lender not to make such Swingline Loan as a result of the
limitations set forth in the proviso in Section 2.2(a), or (B) that one or more
of the applicable conditions specified in Article VI is not then satisfied, then
the Swingline Lender will not make such Swingline Loan.

         (b)      Refunding.

                  (i)      Swingline Loans shall be refunded by the Lenders on
demand by the Swingline Lender. Such refundings shall be made by the Lenders in
accordance with their respective Revolving Credit Commitment Percentages and
shall thereafter be reflected as Revolving Credit Loans of the Lenders on the
books and records of the Administrative Agent. Each Lender shall fund its
respective Revolving Credit Commitment Percentage of Revolving Credit Loans as
required to repay Swingline Loans outstanding to the Swingline Lender upon
demand by the Swingline Lender but in no event later than 2:00 p.m. (New York
time) on the next succeeding Business Day after such demand is made. No Lender's
obligation to fund its respective Revolving Credit Commitment Percentage of a
Swingline Loan shall be affected by any other Lender's failure to fund its
Revolving Credit Commitment Percentage of a Swingline Loan, nor shall any
Lender's Revolving Credit Commitment Percentage be increased as a result of any
such failure of any other Lender to fund its Revolving Credit Commitment
Percentage of a Swingline Loan.

                  (ii)     The Borrower shall pay to the Swingline Lender on
demand the amount of such Swingline Loans to the extent amounts received from
the Lenders are not sufficient to repay in full the outstanding Swingline Loans
requested or required to be refunded. In addition, the Borrower hereby
authorizes the Administrative Agent to charge any account maintained by the
Borrower with the Swingline Lender (up to the amount available therein) in order
to immediately pay the Swingline Lender the amount of such Swingline Loans to
the extent amounts received from the Lenders are not sufficient to repay in full
the outstanding Swingline Loans requested or required to be refunded. If any
portion of any such amount paid to the Swingline Lender shall be recovered by or
on behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise,
the loss of the amount so recovered shall be ratably shared among all the
Lenders in accordance with their respective Revolving Credit Commitment
Percentages (unless the amounts so recovered by or on behalf of the Borrower
pertain to a Swingline Loan extended after the occurrence and during the
continuance of an Event of Default of which the Administrative Agent has
received notice in the manner required pursuant to Section 13.5 and which such
Event of Default has not been waived by the Required Lenders or the Lenders, as
applicable).

                  (iii)    Each Lender acknowledges and agrees that its
obligation to refund Swingline Loans in accordance with the terms of this
Section 2.2 is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including, without limitation, non-satisfaction of the
conditions

                                       19



set forth in Article VI. Further, each Lender agrees and acknowledges that if
prior to the refunding of any outstanding Swingline Loans pursuant to this
Section 2.2, one of the events described in Section 12.1(i) or (j) shall have
occurred, each Lender will, on the date the applicable Revolving Credit Loan
would have been made, purchase an undivided participating interest in the
Swingline Loan to be refunded in an amount equal to its Revolving Credit
Commitment Percentage of the aggregate amount of such Swingline Loan. Each
Lender will immediately transfer to the Swingline Lender, in immediately
available funds, the amount of its participation and upon receipt thereof the
Swingline Lender will deliver to such Lender a certificate evidencing such
participation dated the date of receipt of such funds and for such amount.
Whenever, at any time after the Swingline Lender has received from any Lender
such Lender's participating interest in a Swingline Loan, the Swingline Lender
receives any payment on account thereof, the Swingline Lender will distribute to
such Lender its participating interest in such amount (appropriately adjusted,
in the case of interest payments, to reflect the period of time during which
such Lender's participating interest was outstanding and funded).

         SECTION 2.3 Procedure for Advances of Revolving Credit Loans and
Swingline Loans.

         (a)      Requests for Borrowing. The Borrower shall give the
Administrative Agent irrevocable prior written notice substantially in the form
attached hereto as Exhibit B (a "Notice of Borrowing") not later than 1:00 p.m.
(New York time) (i) on the same Business Day as each Base Rate Loan and each
Swingline Loan and (ii) at least three (3) Business Days before each LIBOR Rate
Loan, of its intention to borrow, specifying (A) the date of such borrowing,
which shall be a Business Day, (B) the amount of such borrowing, which shall be,
(x) with respect to Base Rate Loans (other than Swingline Loans) in an aggregate
minimum principal amount of $1,000,000, (y) with respect to LIBOR Rate Loans in
an aggregate minimum principal amount of $1,000,000 or, at the Borrower's
option, if such borrowing is to be used to pay a principal installment due under
Section 4.3, in an amount equal to the principal amount of such installment, and
(z) with respect to Swingline Loans in an aggregate principal amount of $100,000
or a whole multiple of $100,000 in excess thereof, (C) whether such Loan is to
be a Revolving Credit Loan or Swingline Loan, (D) in the case of a Revolving
Credit Loan whether the Loans are to be LIBOR Rate Loans or Base Rate Loans, and
(E) in the case of a LIBOR Rate Loan, the duration of the Interest Period
applicable thereto. A Notice of Borrowing received after 1:00 p.m. (New York
time) shall be deemed received on the next Business Day. The Administrative
Agent shall promptly notify the Lenders of each Notice of Borrowing.

         (b)      Disbursement of Revolving Credit and Swingline Loans. Not
later than 2:00 p.m. (New York time) on the proposed borrowing date, (i) each
Lender will make available to the Administrative Agent, for the account of the
Borrower, at the office of the Administrative Agent in funds immediately
available to the Administrative Agent, such Lender's Revolving Credit Commitment
Percentage of the Revolving Credit Loans to be made on such borrowing date and
(ii) the Swingline Lender will make available to the Administrative Agent, for
the account of the Borrower, at the office of the Administrative Agent in funds
immediately available to the Administrative Agent, the Swingline Loans to be
made on such borrowing date. The Borrower hereby irrevocably authorizes the
Administrative Agent to disburse the proceeds of each borrowing requested
pursuant to this Section 2.3 in immediately available funds by crediting or
wiring such proceeds to the deposit account of the Borrower identified in the
most recent notice substantially in the form of Exhibit C hereto (a "Notice of
Account Designation") delivered by the Borrower to the Administrative Agent or
as may be otherwise agreed upon by the Borrower and the Administrative Agent
from time to time. Subject to Section 5.7 hereof, the Administrative Agent shall
not be obligated to disburse the portion of the proceeds of any Revolving Credit
Loan requested pursuant to this Section 2.3 to the extent that any Lender has
not made available to the Administrative Agent its Revolving Credit Commitment
Percentage of such Loan. Revolving Credit Loans to be made for the purpose of
refunding Swingline Loans shall be made as Base Rate Loans and shall be made by
the Lenders as provided in Section 2.2(b).

                                       20



         SECTION 2.4 Repayment of Loans.

         (a)      Repayment on Termination Date. The Borrower hereby agrees to
repay the outstanding principal amount of (i) all Revolving Credit Loans in full
on the Revolving Credit Maturity Date, and (ii) all Swingline Loans in
accordance with Section 2.2(b), together, in each case, with all accrued but
unpaid interest thereon. Any Swingline Loan not repaid prior to the Revolving
Credit Maturity Date shall be repaid in full on such date.

         (b)      Mandatory Repayment of Revolving Credit Loans. If at any time
the outstanding principal amount of all Revolving Credit Loans plus the sum of
all outstanding Swingline Loans and L/C Obligations exceeds the Revolving Credit
Commitment, the Borrower agrees to repay immediately upon notice from the
Administrative Agent, by payment to the Administrative Agent for the account of
the Lenders, Extensions of Credit in an amount equal to such excess with each
such repayment applied first to the principal amount of outstanding Swingline
Loans, second to the principal amount of outstanding Revolving Credit Loans and
third, with respect to any Letters of Credit then outstanding, a payment of cash
collateral into a cash collateral account opened by the Administrative Agent,
for the benefit of the Lenders in an amount up to the aggregate then undrawn and
unexpired amount of such Letters of Credit (such cash collateral to be applied
in accordance with Section 12.2(b)).

         (c)      Optional Repayments. The Borrower may at any time and from
time to time repay the Loans, in whole or in part, upon at least three (3)
Business Days' irrevocable notice to the Administrative Agent with respect to
LIBOR Rate Loans and on the same day of irrevocable notice with respect to Base
Rate Loans and Swingline Loans, substantially in the form attached hereto as
Exhibit D (a "Notice of Prepayment") specifying the date and amount of repayment
and whether the repayment is of LIBOR Rate Loans, Base Rate Loans, Swingline
Loans or a combination thereof, and, if of a combination thereof, the amount
allocable to each. Upon receipt of such notice, the Administrative Agent shall
promptly notify each Lender. If any such notice is given, the amount specified
in such notice shall be due and payable on the date set forth in such notice.
Partial repayments shall be in an aggregate minimum amount of $1,000,000 or a
whole multiple of $1,000,000 in excess thereof with respect to Base Rate Loans
(other than Swingline Loans), $2,500,000 with respect to LIBOR Rate Loans and
$100,000 or a whole multiple of $100,000 in excess thereof with respect to
Swingline Loans. Each such repayment shall be accompanied by any amount required
to be paid pursuant to Section 5.9 hereof.

         (d)      Limitation on Repayment of LIBOR Rate Loans. The Borrower may
not repay any LIBOR Rate Loan on any day other than on the last day of the
Interest Period applicable thereto unless such repayment is accompanied by any
amount required to be paid pursuant to Section 5.9 hereof.

         (e)      Hedging Agreements. No repayment or prepayment pursuant to
this Section 2.4 shall affect any of the Borrower's obligations under any
Hedging Agreement.

         SECTION 2.5 Notes.

         (a)      Revolving Credit Notes. Except as otherwise provided in
Section 14.10 (a)-(e), each Lender's Revolving Credit Loans and the obligation
of the Borrower to repay such Revolving Credit Loans shall be evidenced by a
separate Revolving Credit Note executed by the Borrower payable to the order of
such Lender.

         (b)      Swingline Note. The Swingline Loans and the obligation of the
Borrower to repay such Swingline Loans shall be evidenced by a Swingline Note
executed by the Borrower payable to the order of the Swingline Lender.

                                       21



         SECTION 2.6 Permanent Reduction of the Revolving Credit Commitment.

         (a)      Voluntary Reduction. The Borrower shall have the right at any
time and from time to time, upon at least five (5) Business Days prior written
notice to the Administrative Agent, to permanently reduce, without premium or
penalty, (i) the entire Revolving Credit Commitment at any time or (ii) portions
of the Revolving Credit Commitment, from time to time, in an aggregate principal
amount not less than $3,000,000 or any whole multiple of $1,000,000 in excess
thereof. The amount of each partial permanent reduction shall permanently reduce
the Lenders' Revolving Credit Commitments pro rata in accordance with their
respective Revolving Credit Commitment Percentages.

         (b)      Excess Proceeds. If at any time proceeds ("Excess Proceeds")
remain after the prepayment in full of the Term Loans pursuant to Section
4.4(b), the Revolving Credit Commitment shall be permanently reduced on the date
of the required prepayment under Section 4.4(b) by an amount equal to the amount
of such Excess Proceeds; provided, however, if the balance of the Revolving
Credit Commitments falls below the amount of any outstanding Letters of Credit,
then such Excess Proceeds shall be used to cash collaterize such outstanding
Letters of Credit to the extent of such deficiency. The amount of each such
permanent reduction shall permanently reduce the Lenders' Revolving Credit
Commitments pro rata in accordance with their respective Revolving Credit
Commitment Percentages.

         (c)      Corresponding Payment. Each permanent reduction permitted
pursuant to this Section 2.6 shall be accompanied by a payment of principal
sufficient to reduce the aggregate outstanding Revolving Credit Loans, Swingline
Loans and L/C Obligations, as applicable, after such reduction to the Revolving
Credit Commitment as so reduced and if the Revolving Credit Commitment as so
reduced is less than the aggregate amount of all outstanding Letters of Credit,
the Borrower shall be required to deposit cash collateral in a cash collateral
account opened by the Administrative Agent in an amount equal to the amount by
which the aggregate face amount of all outstanding Letters of Credit exceeds the
Revolving Credit Commitment as so reduced. Such cash collateral shall be applied
in accordance with Section 12.2(b). Any reduction of the Revolving Credit
Commitment to zero shall be accompanied by payment of all outstanding Revolving
Credit Loans and Swingline Loans (and furnishing of cash collateral satisfactory
to the Administrative Agent for all L/C Obligations) and shall result in the
termination of the Revolving Credit Commitment and the Swingline Commitment and
the Revolving Credit Facility. Such cash collateral shall be applied in
accordance with Section 12.2(b). If the reduction of the Revolving Credit
Commitment requires the repayment of any LIBOR Rate Loan, such repayment shall
be accompanied by any amount required to be paid pursuant to Section 5.9 hereof.

         SECTION 2.7 Termination of Revolving Credit Facility. The Revolving
Credit Facility shall terminate on the earliest of (a) July 9, 2008, (b) the
date of termination by the Borrower pursuant to Section 2.6, or (c) the date of
termination by the Administrative Agent on behalf of the Lenders pursuant to
Section 12.2(a).

                                  ARTICLE III

                            LETTER OF CREDIT FACILITY

         SECTION 3.1 L/C Commitment. Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the L/C Participants set
forth in Section 3.4(a), agrees to issue standby letters of credit ("Letters of
Credit") for the account of the Borrower on any Business Day from the Closing
Date through but not including the date five (5) Business Days prior to the
Revolving Credit Maturity Date in such form as may be approved from time to time
by the Issuing Lender; provided, that the Issuing Lender shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (a) the L/C Obligations would exceed the L/C Commitment or (b) the
aggregate principal

                                       22



amount of outstanding Revolving Credit Loans, plus the aggregate principal
amount of outstanding Swingline Loans, plus the aggregate amount of L/C
Obligations would exceed the Revolving Credit Commitment. Each Letter of Credit
shall (i) be denominated in a Permitted Currency, (ii) be in a minimum amount of
$25,000 (or the equivalent thereof in any Alternative Currency with respect to
any Alternative Currency Letters of Credit), (iii) be a standby letter of credit
issued to support obligations of the Borrower or any of its Subsidiaries,
contingent or otherwise, incurred in the ordinary course of business, (iv)
expire on a date satisfactory to the Issuing Lender, which date shall be no
later than the earlier of (A) one (1) year after the date of its issuance or (B)
five (5) Business Days prior to the Revolving Credit Maturity Date and (v) be
subject to the Uniform Customs and/or ISP98, as set forth in the Application or
as determined by the Issuing Lender and, to the extent not inconsistent
therewith, the laws of the State of New York. The Issuing Lender shall not at
any time be obligated to issue any Letter of Credit hereunder if such issuance
would conflict with, or cause the Issuing Lender or any L/C Participant to
exceed any limits imposed by, any Applicable Law. References herein to "issue"
and derivations thereof with respect to Letters of Credit shall also include
extensions or modifications of any existing Letters of Credit, unless the
context otherwise requires.

         SECTION 3.2 Procedure for Issuance of Letters of Credit. The Borrower
may from time to time request that the Issuing Lender issue a Letter of Credit
by delivering to the Issuing Lender at the Issuing Lender's Lending Office an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request (which information shall include the Permitted
Currency in which the Letter of Credit shall be denominated). Upon receipt of
any Application, the Issuing Lender shall process such Application and the
certificates, documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures and shall,
subject to Section 3.1 and Article VI hereof, promptly issue the Letter of
Credit requested thereby (but in no event shall the Issuing Lender be required
to issue any Letter of Credit earlier than (a) three (3) Business Days, with
respect to a Letter of Credit denominated in Dollars, and (b) four (4) Business
Days, with respect to an Alternative Currency Letter of Credit, after its
receipt of the Application therefor and all such other certificates, documents
and other papers and information relating thereto) by issuing the original of
such Letter of Credit to the beneficiary thereof or as otherwise may be agreed
by the Issuing Lender and the Borrower. The Issuing Lender shall promptly
furnish to the Borrower a copy of such Letter of Credit and promptly notify each
Lender of the issuance and upon request by any Lender, furnish to such Lender a
copy of such Letter of Credit and the amount of such Lender's participation
therein. If the Issuing Lender has received notice (by telephone or in writing)
from the Administrative Agent (including at the request of any Lender) in
sufficient time to permit the Issuing Lender, through the exercise of
commercially reasonable efforts, to stop the issuance of any Letter of Credit
requested by the Borrower (A) directing the Issuing Lender not to issue such
Letter of Credit as a result of the limitations set forth in the proviso to the
first sentence of Section 3.1(a), or (B) that one or more of the applicable
conditions specified in Article VI is not then satisfied, then the Issuing
Lender will not issue such Letter of Credit.

         SECTION 3.3 .Commissions and Other Charges.

         (a)      The Borrower shall pay to the Administrative Agent, for the
account of the Issuing Lender and the L/C Participants, a letter of credit
commission with respect to each Letter of Credit in an amount equal to the face
amount of such Letter of Credit (reflected as the Dollar Amount thereof, as
determined by the Administrative Agent) multiplied by the Applicable Margin with
respect to Revolving Credit Loans that are LIBOR Rate Loans (determined on a per
annum basis). Such commission shall be payable quarterly in arrears on the last
Business Day of each calendar quarter and on the Revolving Credit Maturity Date
and shall be payable in Dollars based upon the Dollar Amount of such Letters of
Credit for such quarter, as determined by the Administrative Agent. The
Administrative Agent shall, promptly following its receipt thereof, distribute
to the Issuing Lender and the L/C Participants all commissions

                                       23



received pursuant to this Section 3.3(a) in accordance with their respective
Revolving Credit Commitment Percentages.

         (b)      In addition to the foregoing commission, the Borrower shall
pay the Issuing Lender, for its own account, an issuance fee with respect to
each Letter of Credit in an amount equal to the face amount of such Letter of
Credit multiplied by one quarter of one percent (0.25%). Such issuance fee shall
be payable upon issuance of each Letter of Credit and shall be payable in the
Permitted Currency in which the applicable Letter of Credit is denominated.

         (c)      In addition to the foregoing fees and commissions, the
Borrower shall pay or reimburse the Issuing Lender, for its own account, for
such normal and customary costs and expenses as are incurred or charged by the
Issuing Lender in issuing, effecting payment under, amending or otherwise
administering any Letter of Credit. Such costs and expenses shall be payable in
the Permitted Currency in which the Letter of Credit is denominated.

         SECTION 3.4 L/C Participations.

         (a)      The Issuing Lender irrevocably agrees to grant and hereby
grants to each L/C Participant, and, to induce the Issuing Lender to issue
Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept
and purchase and hereby accepts and purchases from the Issuing Lender, on the
terms and conditions hereinafter stated, for such L/C Participant's own account
and risk an undivided interest equal to such L/C Participant's Revolving Credit
Commitment Percentage in the Issuing Lender's obligations and rights under and
in respect of each Letter of Credit issued hereunder and the Dollar Amount of
each draft paid by the Issuing Lender thereunder. Each L/C Participant
unconditionally and irrevocably agrees with the Issuing Lender that, if a draft
is paid under any Letter of Credit for which the Issuing Lender is not
reimbursed in full by the Borrower through a Revolving Credit Loan or otherwise
in accordance with the terms of this Agreement, such L/C Participant shall pay
to the Issuing Lender upon demand at the Issuing Lender's address for notices
specified herein an amount equal to such L/C Participant's Revolving Credit
Commitment Percentage of the Dollar Amount of such draft, or any part thereof,
which is not so reimbursed.

         (b)      Upon becoming aware of any amount required to be paid by any
L/C Participant to the Issuing Lender pursuant to Section 3.4(a) in respect of
any unreimbursed portion of any payment made by the Issuing Lender under any
Letter of Credit, the Issuing Lender shall notify each L/C Participant of the
Dollar Amount and due date of such required payment and such L/C Participant
shall pay to the Issuing Lender the Dollar Amount specified on the applicable
due date. If any such amount is paid to the Issuing Lender after the date such
payment is due, such L/C Participant shall pay to the Issuing Lender on demand,
in addition to such amount, the product of (i) such amount, times (ii) the daily
average Federal Funds Rate as determined by the Administrative Agent during the
period from and including the date such payment is due to the date on which such
payment is immediately available to the Issuing Lender, times (iii) a fraction
the numerator of which is the number of days that elapse during such period and
the denominator of which is 360. A certificate of the Issuing Lender with
respect to any amounts owing under this Section 3.4(b) shall be conclusive in
the absence of manifest error. With respect to payment to the Issuing Lender of
the unreimbursed amounts described in this Section 3.4(b), if the L/C
Participants receive notice that any such payment is due (A) prior to 1:00 p.m.
(New York time) on any Business Day, such payment shall be due that Business
Day, and (B) after 1:00 p.m. (New York time) on any Business Day, such payment
shall be due on the following Business Day.

         (c)      Whenever, at any time after the Issuing Lender has made
payment under any Letter of Credit and has received from any L/C Participant its
Revolving Credit Commitment Percentage of such payment in accordance with this
Section 3.4, the Issuing Lender receives any payment related to such

                                       24



Letter of Credit (whether directly from the Borrower or otherwise), or any
payment of interest on account thereof, the Issuing Lender will distribute to
such L/C Participant its pro rata share of the Dollar Amount thereof; provided,
that in the event that any such payment received by the Issuing Lender shall be
required to be returned by the Issuing Lender, such L/C Participant shall return
to the Issuing Lender the portion thereof previously distributed by the Issuing
Lender to it.

         (d)      All payments made by any L/C Participant under this Section
3.4 shall be made in Dollars; provided that the Borrower shall be liable for any
currency exchange loss pursuant to the terms of Section 3.10.

         SECTION 3.5 Reimbursement of Letter of Credit Drawings.

         (a)      Reimbursement Obligation of the Borrower. In the event of any
drawing under any Letter of Credit, the Borrower agrees to reimburse (either
with the proceeds of a Revolving Credit Loan as provided for in this Section 3.5
or with funds from other sources), in same day funds in the applicable Permitted
Currency in which such Letter of Credit was denominated, the Issuing Lender on
each date on which the Issuing Lender notifies the Borrower of the date and
amount of a draft paid under any Letter of Credit for the amount of (i) such
draft so paid and (ii) any amounts referred to in Section 3.3(c) incurred by the
Issuing Lender in connection with such payment (other then those payable
pursuant to Section 3.5(c) below).

         (b)      Reimbursement By the Lenders. Unless the Borrower shall
immediately notify the Issuing Lender that the Borrower intends to reimburse the
Issuing Lender for such drawing from other sources or funds, the Borrower shall
be deemed to have timely given a Notice of Borrowing to the Administrative Agent
requesting that the Lenders make a Revolving Credit Loan funded in Dollars
bearing interest at the Base Rate on such date in the amount of (a) such draft
so paid and (b) any amounts referred to in Section 3.3(c) incurred by the
Issuing Lender in connection with such payment (including, without limitation,
any and all costs, fees and other expenses incurred by the Issuing Lender in
effecting the payment of any Letter of Credit denominated in an Alternative
Currency), and the Lenders shall make a Revolving Credit Loan funded in Dollars
bearing interest at the Base Rate in such amount, the proceeds of which shall be
applied to reimburse the Issuing Lender for the amount of the related drawing
and costs and expenses. Each Lender acknowledges and agrees that its obligation
to fund a Revolving Credit Loan in accordance with this Section 3.5 to reimburse
the Issuing Lender for any draft paid under a Letter of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including, without limitation, non-satisfaction of the conditions set forth in
Section 2.3(a) or Article VI. If the Borrower has elected to pay the amount of
such drawing with funds from other sources and shall fail to reimburse the
Issuing Lender as provided above, the unreimbursed amount of such drawing shall
bear interest at the rate which would be payable on any outstanding Base Rate
Loans which were then overdue from the date such amounts become payable (whether
at stated maturity, by acceleration or otherwise) until payment in full.

         (c)      Payment of Alternative Currency Letters of Credit. Each
payment by the Borrower on account of any Alternative Currency Letter of Credit
(including the Reimbursement Obligation with respect to any Alternative Currency
Letter of Credit) shall be made in such Alternative Currency not later than 1:00
p.m. (local time at the office of the Issuing Lender's Correspondent) on the
date specified for payment under this Agreement to the Administrative Agent's
account with the Issuing Lender's Correspondent for the account of the Issuing
Lender in immediately available funds, and shall be made without any set-off,
counterclaim or deduction whatsoever. Any payment received after such time but
before 2:00 p.m. (local time at the office of the Issuing Lender's
Correspondent) on such day shall be deemed a payment on such date for the
purposes of Section 12.1, but for all other purposes shall be deemed to have
been made on the next succeeding Business Day. Any payment received after 2:00
p.m.

                                       25



(the time of the Issuing Lender's Correspondent) shall be deemed to have been
made on the next succeeding Business Day for all purposes.

         SECTION 3.6 Obligations Absolute. The Borrower's obligations under this
Article III (including, without limitation, the Reimbursement Obligation) shall
be absolute and unconditional under any and all circumstances and irrespective
of any set-off, counterclaim or defense to payment which the Borrower may have
or have had against the Issuing Lender or any beneficiary of a Letter of Credit
or any other Person. The Borrower also agrees that the Issuing Lender and the
L/C Participants shall not be responsible for, and the Borrower's Reimbursement
Obligation under Section 3.5 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though
such documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among the Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower against any beneficiary of such Letter of
Credit or any such transferee. The Issuing Lender shall not be liable for any
error, omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Letter of
Credit, except for errors or omissions caused by the Issuing Lender's gross
negligence or willful misconduct. The Borrower agrees that any action taken or
omitted by the Issuing Lender under or in connection with any Letter of Credit
or the related drafts or documents, if done in the absence of gross negligence
or willful misconduct, shall be binding on the Borrower and shall not result in
any liability of the Issuing Lender or any L/C Participant to the Borrower. The
responsibility of the Issuing Lender to the Borrower in connection with any
draft presented for payment under any Letter of Credit shall, in addition to any
payment obligation expressly provided for in such Letter of Credit, be limited
to determining that the documents (including each draft) delivered under such
Letter of Credit in connection with such presentment are in conformity with such
Letter of Credit.

         SECTION 3.7 Excess L/C Obligations. If at any time (as determined by
the Administrative Agent pursuant to this Section 3.7) and because of currency
fluctuations or for any other reason, based upon the Dollar Amount of all
outstanding Loans and L/C Obligations, the outstanding amount of all L/C
Obligations exceeds the lesser of (a) the Aggregate Commitment less the sum of
the amount of all outstanding Loans and (b) the L/C Commitment, then, in each
such case, the Borrower shall, at its option, either (i) repay Loans in an
amount equal to such excess (to the extent such repayment will eliminate such
excess) or (ii) make a payment of cash collateral into a cash collateral account
opened by the Administrative Agent for the benefit of the Lenders in an amount
equal to such excess (such cash collateral to be applied in accordance with
Section 12.2(b)). The Borrower's compliance with this Section 3.7 shall be
tested from time to time by the Administrative Agent at its sole discretion, but
in any event shall be tested on (x) the date on which the Borrower requests the
Lenders to make a Loan or requests the Issuing Lender to issue a Letter of
Credit under Section 6.3 and (y) the date an interest payment is due under
Section 5.1(e). Each such repayment pursuant to this Section 3.7 shall be
accompanied by any amount required to be paid pursuant to Section 5.9 hereof.

         SECTION 3.8 Redenomination under EMU.

         (a)      Redenomination of Letters of Credit. Subject to Section 1.4
hereof, any Letter of Credit to be denominated in the currency of the applicable
Participating Member State shall be made in the euro.

         (b)      Redenomination of Obligations. Subject to Section 1.4 hereof,
any obligation of any party under this Agreement or any other Loan Document
which has been denominated in the currency of a Participating Member State shall
be redenominated into the euro.

         (c)      Further Assurances. The terms and provisions of this Agreement
will be subject to such reasonable changes of construction as determined by the
Administrative Agent to reflect the

                                       26



implementation of the EMU in any Participating Member State or any market
conventions relating to the fixing and/or calculation of interest being changed
or replaced and to reflect market practice at that time, and subject thereto, to
put the Administrative Agent, the Lenders and the Borrower in the same position,
so far as possible, that they would have been if such implementation had not
occurred. In connection therewith, the Borrowers agree, at the request of the
Administrative Agent, at the time of or at any time following the implementation
of the EMU in any Participating Member State or any market conventions relating
to the fixing and/or calculation of interest being changed or replaced, to enter
into an agreement amending this Agreement in such manner as the Administrative
Agent shall reasonably request.

         SECTION 3.9 Regulatory Limitation. In the event, as a result of
increases in the value of Alternative Currencies against the Dollar or for any
other reason, the obligation of the Issuing Lender to issue Alternative Currency
Letters of Credit (taking into account the Dollar Amount of the Obligations and
all other indebtedness required to be aggregated under 12 U.S.C.A. Section 84,
as amended, the regulations promulgated thereunder and any other Applicable Law)
is determined by the Issuing Lender to exceed its then applicable legal lending
limit under 12 U.S.C.A. Section 84, as amended, and the regulations promulgated
thereunder, or any other Applicable Law, the amount of additional Alternative
Currency Letters of Credit the Issuing Lenders shall be obligated to issue
hereunder shall immediately be reduced to the maximum amount which the Issuing
Lender may legally advance (as determined by the Issuing Lender) and, to the
extent necessary under such laws and regulations (as determined by the Issuing
Lender, with respect to the applicability of such laws and regulations to
itself), the Borrower shall reduce, or cause to be reduced, complying to the
extent practicable with the remaining provisions hereof, the Obligations
outstanding hereunder by an amount sufficient to comply with such maximum
amounts.

         SECTION 3.10 Exchange Indemnification and Increased Costs. The Borrower
shall, upon demand from the Issuing Lender or any L/C Participant, pay to the
Issuing Lender or such L/C Participant, the amount of (a) any loss or cost or
increased cost incurred by the Issuing Lender or such L/C Participant, (b) any
reduction in any amount payable to or in the effective return on the capital to
the Issuing Lender or such L/C Participant, (c) any interest or any other
return, including principal, foregone by the Issuing Lender as a result of the
introduction of, change over to or operation of the euro or (d) any currency
exchange loss, in each case that the Issuing Lender or such L/C Participant
sustains as a result of the Borrower's or any L/C Participant's repayment in
Dollars of any Alternative Currency Letter of Credit. A certificate of the
Issuing Lender setting forth in reasonable detail the basis for determining such
additional amount or amounts necessary to compensate the Issuing Lender shall be
conclusively presumed to be correct save for manifest error.

         SECTION 3.11 Rounding and Other Consequential Changes. Subject to
Section 1.4 hereof, without prejudice and in addition to any method of
conversion or rounding prescribed by any EMU Legislation and without prejudice
to the respective obligations of the Borrower to the Administrative Agent and
the Lenders and the Administrative Agent and the Lenders to the Borrower under
or pursuant to this Agreement, except as expressly provided in this Agreement,
each provision of this Agreement, including, without limitation, the right to
combine currencies to effect a set-off, shall be subject to such reasonable
changes of interpretation as the Administrative Agent may from time to time
specify to be necessary or appropriate to reflect the introduction of or change
over to the euro in Participating Member States.

         SECTION 3.12 Effect of Application. To the extent that any provision of
any Application related to any Letter of Credit is inconsistent with the
provisions of this Article III, the provisions of this Article III shall apply.

                                       27



                                   ARTICLE IV

                               TERM LOAN FACILITY

         SECTION 4.1 Term Loan. The Term Loan was advanced to the Borrower on
December 12, 2002 pursuant to the Existing Facility. After giving effect to the
repayment of the Term Loan on or before the Closing Date so that the outstanding
Term Loan equals $100,000,000, the outstanding Term Loan shall have been funded
by each Lender in a principal amount equal to such Lender's Term Loan Commitment
on the Closing Date, which aggregate principal amount shall equal the total Term
Loan Commitment as of the Closing Date.

         SECTION 4.2 Procedure for Advance of Term Loan. [This section
intentionally left blank.]

         SECTION 4.3 Repayment of Term Loan. The Borrower shall repay the
aggregate outstanding principal amount of the Term Loan in consecutive quarterly
installments on the last Business Day of each three month period specified
below, commencing October 31, 2003, and on the Term Loan Maturity Date, as set
forth below, except as the amounts of individual installments may be adjusted
pursuant to Section 4.4 hereof:



                                                               PRINCIPAL
                THREE MONTH PERIOD                            INSTALLMENT
 YEAR                ENDING                                       ($)
- -------------------------------------------------------------------------
                                                        
 2003               October 31                                 1,250,000
- ------------------------------------------------------------------------
 2004               January 31                                 1,250,000
- ------------------------------------------------------------------------
                    April 30                                   1,250,000
                    ----------------------------------------------------
                    July 31                                    1,250,000
                    ----------------------------------------------------
                    October 31                                 1,875,000
- ---------------------------------------------------------------------
 2005               January 31                                 1,875,000
                    ----------------------------------------------------
                    April 30                                   1,875,000
                    ----------------------------------------------------
                    July 31                                    1,875,000
                    ----------------------------------------------------
                    October 31                                 1,875,000
- ---------------------------------------------------------------------
  2006              January 31                                 1,875,000
                    ----------------------------------------------------
                    April 30                                   1,875,000
                    ----------------------------------------------------
                    July 31                                    1,875,000
                    ----------------------------------------------------
                    October 31                                 1,875,000
- ---------------------------------------------------------------------
 2007               January 31                                 1,875,000
                    ----------------------------------------------------
                    April 30                                   1,875,000
                    ----------------------------------------------------
                    July 31                                    1,875,000
                    ----------------------------------------------------
                    October 31                                 1,875,000
- ------------------------------------------------------------------------
  2008              January 31                                 1,875,000
                    ----------------------------------------------------
                    April 30                                   1,875,000
                    ----------------------------------------------------
                    July 31                                    1,875,000
                    ----------------------------------------------------
                    October 31                                16,250,000
- ---------------------------------------------------------------------
 2009               January 31                                16,250,000
                    ----------------------------------------------------
                    April 30                                  16,250,000
- ---------------------------------------------------------------------
                    Term Loan Maturity Date                  $16,250,000
- ------------------------------------------------------------------------


If not sooner paid, the Term Loan shall be paid in full, together with accrued
interest thereon, on the Term Loan Maturity Date. Amounts repaid under the Term
Loan pursuant to this Section 4.3 may not be reborrowed.

                                       28



         SECTION 4.4 Prepayments of Term Loan.

         (a)      Optional Prepayment of Term Loan. The Borrower shall have the
right at any time and from time to time, upon delivery to the Administrative
Agent of a Notice of Prepayment at least three (3) Business Days prior to any
repayment, to prepay the Term Loan in whole or in part without premium or
penalty except as provided in Section 5.9. Each optional prepayment of the Term
Loan hereunder shall be in an aggregate principal amount of at least $5,000,000
and shall be applied to the outstanding principal installments of the Term Loan
in inverse order of maturity thereof. Each repayment shall be accompanied by any
amount required to be paid pursuant to Section 5.9 hereof.

         (b)      Mandatory Prepayment of Loans.

                  (i)      Debt Proceeds. The Borrower shall make mandatory
principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi)
below in amounts equal to one hundred percent (100%) of the aggregate Net Cash
Proceeds from any incurrence of Debt (other than Debt permitted pursuant to
Section 11.1 or otherwise permitted by the Required Lenders) by the Borrower or
any of its Restricted Subsidiaries. Such prepayment shall be made within three
(3) Business Days after the date of receipt of Net Cash Proceeds of any such
transaction.

                  (ii)     Equity Proceeds. The Borrower shall make mandatory
principal prepayments of the Loans in the manner set forth in Section 4.4(b)(vi)
below in amounts equal to fifty percent (50%) of the aggregate Net Cash Proceeds
from any offering of equity securities by the Borrower or any of its Restricted
Subsidiaries, other than Net Cash Proceeds resulting solely from (A) offerings
of equity securities made in connection with any employee stock option,
incentive plan or stock purchase plan or made in connection with compensation or
incentive plans for directors and officers, in each case, entered into in the
ordinary course of business and (B) an offering of PIK Preferred Stock; provided
that (x) the Borrower may retain the first $100,000,000 of the Net Cash Proceeds
raised in such offerings of equity securities within the first twelve months of
the Closing Date, subject to such Net Cash Proceeds being reinvested in
Permitted Acquisitions or in other revenue producing assets related to a
Permitted Business within two hundred seventy (270) days of such offering and
(y) no Default or Event of Default is continuing or would result from such
offering. Such prepayment shall be made within three (3) Business Days after the
date of receipt of Net Cash Proceeds of any such transaction.

                  (iii)    Asset Sale Proceeds. To the extent permitted by
Applicable Law, no later than two hundred seventy (270) days following the
Borrower's or applicable Restricted Subsidiary's receipt thereof, the Borrower
shall make mandatory principal prepayments of the Loans in the manner set forth
in Section 4.4(b)(vi) below in amounts equal to (x) one hundred percent (100%)
of the aggregate Net Cash Proceeds from the sale or other disposition or series
of related sales or other dispositions of assets by the Borrower or any of its
Subsidiaries permitted pursuant to Section 11.5(f) or otherwise permitted by the
Required Lenders (y) fifty percent (50%) of the aggregate Net Cash Proceeds from
the sale or other disposition or series of related sales or other dispositions
by the Borrower of those assets listed on Schedule 4.4(b)(iii), provided that
the remaining balance of such Net Cash Proceeds have been reinvested in
Permitted Acquisitions or in other revenue producing assets related to a
Permitted Business within two hundred seventy (270) days after receipt of such
Net Cash Proceeds, and (z) zero (0%) of the Net Cash Proceeds from the sale or
other disposition or series of related sales or other dispositions by the
Borrower of its ownership interests in PCG, provided that such Net Cash Proceeds
have been reinvested in Permitted Acquisitions or in other revenue producing
assets related to a Permitted Business within two hundred seventy (270) days
after the receipt thereof. If Net Cash Proceeds are not reinvested by the date
which is two hundred seventy (270) days following the Borrower's or Restricted
Subsidiary's receipt thereof the Borrower shall make a mandatory prepayment in
an amount equal to such Net Cash Proceeds as described above on such date.
Notwithstanding any of the foregoing to the contrary, upon and during

                                       29



the continuance of an Event of Default and upon notice from the Administrative
Agent, all Net Cash Proceeds from the sale or other disposition or series of
related sales or other dispositions of assets by the Borrower or any of its
Restricted Subsidiaries, received by the Borrower and its Restricted
Subsidiaries shall be applied to make prepayments of the Loans pursuant to
Section 4.4(b)(vi), such prepayments to be made within three (3) Business Days
after the Borrower's or such Restricted Subsidiary's receipt of such Net Cash
Proceeds.

                  (iv)     Insurance and Condemnation Proceeds. No later than
one hundred eighty (180) days following the date of receipt by the Borrower or
any of its Restricted Subsidiaries of any Net Cash Proceeds under any of the
insurance policies maintained pursuant to Section 9.3 or from any condemnation
proceeding (the "Insurance and Condemnation Proceeds") which have not been
reinvested as of such date in similar replacement assets, the Borrower shall
make mandatory principal prepayments of the Loans in the manner set forth in
Section 4.4(b)(vi) below in amounts equal to one hundred percent (100%) of the
aggregate amount of such Insurance and Condemnation Proceeds received by the
Borrower or any of its Restricted Subsidiaries. Notwithstanding any of the
foregoing to the contrary, upon and during the continuance of an Event of
Default and upon notice from the Administrative Agent, all Insurance and
Condemnation Proceeds, received by the Borrower and its Subsidiaries shall be
applied to make prepayments of the Loans, such prepayments to be made within
three (3) Business Days after the Borrower's or such Restricted Subsidiary's
receipt of such Insurance and Condemnation Proceeds.

                  (v)      Excess Cash Flow. No later than one hundred and
twenty five (125) days after the end of any Fiscal Year commencing with the
Fiscal Year ending December 28, 2003, if at any Fiscal Year end the Total
Leverage Ratio exceeds 1.50 to 1.00, the Borrower shall make a mandatory
principal repayment of the Loans in an amount equal to fifty percent (50%) of
Excess Cash Flow, if any, for such Fiscal Year. Notwithstanding the foregoing,
Excess Cash Flow computed for the Fiscal Year ending December 28, 2003 shall be
for the period from July 1, 2003 through December 28, 2003.

                  (vi)     Notice; Manner of Payment.

                           (A)      Upon the occurrence of any event triggering
         the prepayment requirement under Sections 4.4(b)(i) through and
         including 4.4(b)(iv), the Borrower shall promptly deliver a Notice of
         Prepayment to the Administrative Agent and upon receipt of such notice,
         the Administrative Agent shall promptly so notify the Lenders.

                           (B)      Each prepayment under this Section 4.4(b)
         shall be applied as follows: (i) first, to reduce on a pro rata basis
         the remaining scheduled principal installments of the Term Loans
         pursuant to Section 4.3 and (ii) second, to the extent of any excess,
         to reduce permanently the Revolving Credit Commitment pursuant to
         Section 2.6(b) provided, that each Lender shall have the right, so long
         as there are outstandings under the Revolving Credit Facility, to
         refuse any such mandatory prepayment of the Term Loans, at which time
         the full amount of any such refused payments shall be applied to repay
         outstanding Revolving Credit Loans without a corresponding reduction of
         the Revolving Credit Commitment.

                           (C)      Amounts prepaid under the Term Loan pursuant
         to this Section 4.4 may not be reborrowed and will constitute a
         permanent reduction in such Term Loan Commitment. Each prepayment shall
         be accompanied by any amount required to be paid pursuant to Section
         5.9 hereof.

         SECTION 4.5 Term Notes. Except as otherwise provided in Section
14.10(a)-(e), each Lender's Term Loan and the obligation of the Borrower to
repay such Term Loan shall be evidenced by a separate Term Note executed by the
Borrower payable to the order of such Lender.

                                       30



                                   ARTICLE V

                             GENERAL LOAN PROVISIONS

         SECTION 5.1 Interest.

         (a)      Interest Rate Options. Subject to the provisions of this
Section 5.1, at the election of the Borrower, (i) Revolving Credit Loans and
Term Loans shall bear interest at (A) the Base Rate plus the Applicable Margin
or (B) the LIBOR Rate plus the Applicable Margin and (ii) Swingline Loans shall
bear interest at the Base Rate plus the Applicable Margin. The Borrower shall
select the rate of interest and Interest Period, if any, applicable to any Loan
at the time a Notice of Borrowing is given pursuant to Section 2.3 or Section
4.2, as applicable, or at the time a Notice of Conversion/Continuation is given
pursuant to Section 5.2. Any Loan or any portion thereof as to which the
Borrower has not duly specified an interest rate as provided herein shall be
deemed a Base Rate Loan.

         (b)      Interest Periods. In connection with each LIBOR Rate Loan, the
Borrower, by giving notice at the times described in Section 5.1(a), shall elect
an interest period (each, an "Interest Period") to be applicable to such Loan,
which Interest Period shall be a period of one (1), two (2), three (3), or six
(6) months with respect to each LIBOR Rate Loan; provided that:

                  (i)      the Interest Period shall commence on the date of
advance of or conversion to any LIBOR Rate Loan and, in the case of immediately
successive Interest Periods, each successive Interest Period shall commence on
the date on which the immediately preceding Interest Period expires;

                  (ii)     if any Interest Period would otherwise expire on a
day that is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; provided, that if any Interest Period with respect to a
LIBOR Rate Loan would otherwise expire on a day that is not a Business Day but
is a day of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the immediately preceding Business Day;

                  (iii)    any Interest Period with respect to a LIBOR Rate Loan
that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business Day of the relevant
calendar month at the end of such Interest Period;

                  (iv)     no Interest Period shall extend beyond the Revolving
Credit Maturity Date or the Term Loan Maturity Date, as applicable, and Interest
Periods shall be selected by the Borrower so as to permit the Borrower to make
the quarterly principal installment payments pursuant to Section 4.3 without
payment of any amounts pursuant to Section 5.9; and

                  (v)      there shall be no more than six (6) Interest Periods
in effect at any time.

         (c)      Applicable Margin. The Applicable Margin provided for in
Section 5.1(a) with respect to any Loan (the "Applicable Margin") shall be based
upon the table set forth below and shall be determined and adjusted quarterly on
the date (each a "Calculation Date") ten (10) Business Days after the date by
which the Borrower is required to provide an Officer's Compliance Certificate
for the most recently ended fiscal quarter of the Borrower; provided, however,
that (a) the initial Applicable Margin shall be based on Pricing Level III (as
shown below) and shall remain at Pricing Level III until receipt by the
Administrative Agent of the Officer's Compliance Certificate for the period
ended December 28, 2003 and, thereafter the Pricing Level shall be determined by
reference to the Total Leverage Ratio as of the last day of the most recently
ended fiscal quarter of the Borrower preceding the applicable Calculation

                                       31



Date, and (b) if the Borrower fails to provide the Officer's Compliance
Certificate as required by Section 8.2 for the most recently ended fiscal
quarter of the Borrower preceding the applicable Calculation Date, the
Applicable Margin from such Calculation Date shall be based on Pricing Level IV
(as shown below) until such time as an appropriate Officer's Compliance
Certificate is provided, at which time the Pricing Level shall be determined by
reference to the Total Leverage Ratio as of the last day of the most recently
ended fiscal quarter of the Borrower preceding such Calculation Date. The
Applicable Margin shall be effective from one Calculation Date until the next
Calculation Date. Any adjustment in the Applicable Margin shall be applicable to
all Extensions of Credit then existing or subsequently made or issued.



                                                  REVOLVING CREDIT LOANS                TERM LOANS
- -----------------------------------------------------------------------------------------------------------
PRICING
 LEVEL          TOTAL LEVERAGE RATIO             LIBOR          BASE RATE         LIBOR           BASE RATE
- -----------------------------------------------------------------------------------------------------------
                                                                                   
IV        Greater than 3.00 to 1.00              3.25%            2.00%            3.00%            1.75%
- --------------------------------------------------------------------------------------------------------
III       Greater than 2.50 to 1.00, but         3.00%            1.75%            3.00%            1.75%
          less than or equal to 3.00 to
          1.00
- --------------------------------------------------------------------------------------------------------
II        Greater than 2.00 to 1.00, but         2.75%            1.50%            3.00%            1.75%
          less than or equal to 2.50 to
          1.00
- --------------------------------------------------------------------------------------------------------
I         Less than or equal to 2.00             2.50%            1.25%            3.00%            1.75%
- --------------------------------------------------------------------------------------------------------


         (d)      Default Rate. Subject to Section 12.3, at the discretion of
the Administrative Agent or as directed by the Required Lenders, upon the
occurrence and during the continuance of an Event of Default, (i) the Borrower
shall no longer have the option to request the conversion of any outstanding
Loans to, or the continuation of any outstanding Loan as, LIBOR Rate Loans, (ii)
all outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two
percent (2%) in excess of the rate then applicable to LIBOR Rate Loans until the
end of the applicable Interest Period and thereafter at a rate equal to two
percent (2%) in excess of the rate then applicable to Base Rate Loans, and (iii)
all outstanding Base Rate Loans and other Obligations arising hereunder or under
any other Loan Document shall bear interest at a rate per annum equal to two
percent (2%) in excess of the rate then applicable to Base Rate Loans or such
other Obligations arising hereunder or under any other Loan Document. Interest
shall continue to accrue on the Notes after the filing by or against the
Borrower of any petition seeking any relief in bankruptcy or under any act or
law pertaining to insolvency or debtor relief, whether state, federal or
foreign.

         (e)      Interest Payment and Computation. Interest on each Base Rate
Loan shall be payable in arrears on the last Business Day of each consecutive
three month period ending October 31, January 31, April 30 and July 31 during
the term of this Agreement, commencing October 31, 2003; and interest on each
LIBOR Rate Loan shall be payable on the last day of each Interest Period
applicable thereto, and if such Interest Period is longer than three (3) months,
at the end of each three (3) month interval during such Interest Period.
Interest on LIBOR Rate Loans and all fees payable hereunder shall be computed on
the basis of a 360-day year and assessed for the actual number of days elapsed
and interest on Base Rate Loans shall be computed on the basis of a 365/366-day
year and assessed for the actual number of days elapsed.

         (f)      Maximum Rate. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest hereunder or under any of the Notes
charged or collected pursuant to the terms of this Agreement or pursuant to any
of the Notes exceed the highest rate permissible under any Applicable Law which
a court of competent jurisdiction shall, in a final determination, deem
applicable

                                       32



hereto. In the event that such a court determines that the Lenders have charged
or received interest hereunder in excess of the highest applicable rate, the
rate in effect hereunder shall automatically be reduced to the maximum rate
permitted by Applicable Law and the Lenders shall at the Administrative Agent's
option (i) promptly refund to the Borrower any interest received by the Lenders
in excess of the maximum lawful rate or (ii) apply such excess to the principal
balance of the Obligations on a pro rata basis. It is the intent hereof that the
Borrower not pay or contract to pay, and that neither the Administrative Agent
nor any Lender receive or contract to receive, directly or indirectly in any
manner whatsoever, interest in excess of that which may be paid by the Borrower
under Applicable Law.

         SECTION 5.2 Notice and Manner of Conversion or Continuation of Loans.
Provided that no Default or Event of Default has occurred and is then
continuing, the Borrower shall have the option to (a) convert at any time
following the third Business Day after the Closing Date all or any portion of
any outstanding Base Rate Loans (other than Swingline Loans) in a minimum
principal amount equal to $2,500,000 into one or more LIBOR Rate Loans and (b)
upon the expiration of any Interest Period, (i) convert all or any part of its
outstanding LIBOR Rate Loans in a minimum principal amount equal to $1,000,000
into Base Rate Loans (other than Swingline Loans) or (ii) continue such LIBOR
Rate Loans as LIBOR Rate Loans. Whenever the Borrower desires to convert or
continue Loans as provided above, the Borrower shall give the Administrative
Agent irrevocable prior written notice in the form attached as Exhibit E (a
"Notice of Conversion/Continuation") not later than 1:00 p.m. (New York time)
three (3) Business Days before the day on which a proposed conversion or
continuation of such Loan is to be effective specifying (A) the Loans to be
converted or continued, and, in the case of any LIBOR Rate Loan to be converted
or continued, the last day of the Interest Period therefor, (B) the effective
date of such conversion or continuation (which shall be a Business Day), (C) the
principal amount of such Loans to be converted or continued, and (D) the
Interest Period to be applicable to such converted or continued LIBOR Rate Loan.
The Administrative Agent shall promptly notify the Lenders of such Notice of
Conversion/Continuation.

         SECTION 5.3 Fees.

         (a)      Commitment Fee. Commencing on the Closing Date, the Borrower
shall pay to the Administrative Agent, for the account of the Lenders, a
non-refundable commitment fee at a rate per annum equal to 0.50% on the average
daily unused portion of the Revolving Credit Commitment; provided that the
amount of outstanding Swingline Loans shall not be considered usage of the
Revolving Credit Commitment for the purpose of calculating such commitment fee.
The commitment fee shall be payable in arrears on the last Business Day of each
consecutive three month period ending October 31, January 31, April 30 and July
31 during the term of this Agreement commencing October 31, 2003 and on the
Revolving Credit Maturity Date. Such commitment fee shall be distributed by the
Administrative Agent to the Lenders pro rata in accordance with the Lenders'
respective Revolving Credit Commitment Percentages.

         (b)      Administrative Agent's and Other Fees. In order to compensate
the Administrative Agent for structuring and syndicating the Loans and for its
obligations hereunder, the Borrower agrees to pay to the Administrative Agent,
for its account, the fees set forth in the separate fee letter agreement
executed by the Borrower and the Administrative Agent dated April 30, 2003, as
amended.

         SECTION 5.4 Manner of Payment. Each payment by the Borrower on account
of the principal of or interest on the Loans or of any fee, commission or other
amounts (including the Reimbursement Obligation) payable to the Lenders under
this Agreement or any Note shall be made not later than 1:00 p.m. (New York
time) on the date specified for payment under this Agreement to the
Administrative Agent at the Administrative Agent's Office for the account of the
Lenders (other than as set forth below) pro rata in accordance with their
respective Revolving Credit Commitment Percentages or Term Loan

                                       33



Percentages, as applicable, (except as specified below), in Dollars, in
immediately available funds and shall be made without any set-off, counterclaim
or deduction whatsoever. Any payment received after such time but before 2:00
p.m. (New York time) on such day shall be deemed a payment on such date for the
purposes of Section 12.1, but for all other purposes shall be deemed to have
been made on the next succeeding Business Day. Any payment received after 2:00
p.m. (New York time) shall be deemed to have been made on the next succeeding
Business Day for all purposes. Upon receipt by the Administrative Agent of each
such payment, the Administrative Agent shall distribute to each Lender at its
address for notices set forth herein its pro rata share of such payment in
accordance with such Lender's Revolving Credit Commitment Percentage or Term
Loan Percentage, as applicable, (except as specified below) and shall wire
advice of the amount of such credit to each Lender. Each payment to the
Administrative Agent of the Issuing Lender's fees or L/C Participants'
commissions shall be made in like manner, but for the account of the Issuing
Lender or the L/C Participants, as the case may be. Each payment to the
Administrative Agent of Administrative Agent's fees or expenses shall be made
for the account of the Administrative Agent and any amount payable to any Lender
under Sections 5.8, 5.9, 5.10, 5.11 or 14.2 shall be paid to the Administrative
Agent for the account of the applicable Lender. Subject to Section 5.1(b)(ii) if
any payment under this Agreement or any Note shall be specified to be made upon
a day which is not a Business Day, it shall be made on the next succeeding day
which is a Business Day and such extension of time shall in such case be
included in computing any interest if payable along with such payment.

         SECTION 5.5 Crediting of Payments and Proceeds. In the event that the
Borrower shall fail to pay any of the Obligations when due and the Obligations
have been accelerated pursuant to Section 12.2, all payments received by the
Lenders upon the Notes and the other Obligations and all net proceeds from the
enforcement of the Obligations shall be applied: (a) first to all expenses then
due and payable by the Borrower hereunder and under the other Loan Documents,
(b) then to all indemnity obligations then due and payable by the Borrower
hereunder and under the other Loan Documents, (c) then to all of the
Administrative Agent's and Issuing Lender's fees then due and payable, (d) then
to all commitment and other fees and commissions then due and payable, (e) then
to accrued and unpaid interest on the Notes, accrued and unpaid interest on the
Reimbursement Obligation and accrued and unpaid periodic payments or interest
(but not any settlement amounts) payable under any Hedging Obligations (pro rata
in accordance with all such amounts due), (f) then to the principal amount of
the Notes and Reimbursement Obligation and any settlement amounts payable under
any Hedging Obligations (pro rata in accordance with all such amounts due) and
(g) then to the cash collateral account described in Section 12.2(b) hereof to
the extent of any L/C Obligations then outstanding, in that order.

         SECTION 5.6 Adjustments. If any Lender (a "Benefited Lender") shall at
any time receive any payment of all or part of the Obligations owing to it, or
interest thereon, or if any Lender shall at any time receive any collateral in
respect to the Obligations owing to it (whether voluntarily or involuntarily, by
set-off or otherwise) (other than pursuant to Sections 5.8, 5.9, 5.10, 5.11 or
14.2 hereof) in a greater proportion than any such payment to and collateral
received by any other Lender, if any, in respect of the similar Obligations
owing to such other Lender, or interest thereon, such Benefited Lender shall
purchase for cash from the other Lenders such portion of each such other
Lender's Extensions of Credit, or shall provide such other Lenders with the
benefits of any such collateral, or the proceeds thereof, as shall be necessary
to cause such Benefited Lender to share the excess payment or benefits of such
collateral or proceeds ratably with each of the Lenders; provided, that if all
or any portion of such excess payment or benefits is thereafter recovered from
such Benefited Lender, such purchase shall be rescinded, and the purchase price
and benefits returned to the extent of such recovery, but without interest. The
Borrower agrees that each Lender so purchasing a portion of another Lender's
Extensions of Credit may exercise all rights of payment (including, without
limitation, rights of set-off) with respect to such portion as fully as if such
Lender were the direct holder of such portion.

                                       34



         SECTION 5.7 Nature of Obligations of Lenders Regarding Extensions of
Credit; Assumption by the Administrative Agent. The obligations of the Lenders
under this Agreement to make the Loans and issue or participate in Letters of
Credit are several and are not joint or joint and several. Unless the
Administrative Agent shall have received notice from a Lender prior to a
proposed borrowing date that such Lender will not make available to the
Administrative Agent such Lender's ratable portion of the amount to be borrowed
on such date (which notice shall not release such Lender of its obligations
hereunder), the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the proposed borrowing date in
accordance with Sections 2.3(b) and 4.2, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If such amount is made available to the Administrative
Agent on a date after such borrowing date, such Lender shall pay to the
Administrative Agent on demand an amount, until paid, equal to the product of
(a) the amount not made available by such Lender in accordance with the terms
hereof, times (b) the daily average Federal Funds Rate during such period as
determined by the Administrative Agent, times (c) a fraction the numerator of
which is the number of days that elapse from and including such borrowing date
to the date on which such amount not made available by such Lender in accordance
with the terms hereof shall have become immediately available to the
Administrative Agent and the denominator of which is 360. A certificate of the
Administrative Agent with respect to any amounts owing under this Section 5.7
shall be conclusive, absent manifest error. If such Lender's ratable portion of
such borrowing is not made available to the Administrative Agent by such Lender
within three (3) Business Days after such borrowing date, the Administrative
Agent shall be entitled to recover such amount made available by the
Administrative Agent with interest thereon at the rate per annum applicable to
Base Rate Loans hereunder, on demand, from the Borrower. The failure of any
Lender to make available its ratable portion of any Loan requested by the
Borrower shall not relieve it or any other Lender of its obligation, if any,
hereunder to make its ratable portion of such Loan available on the borrowing
date, but no Lender shall be responsible for the failure of any other Lender to
make its ratable portion of such Loan available on the borrowing date.
Notwithstanding anything set forth herein to the contrary, any Lender that fails
to make available its ratable portion of any Loan shall not (a) have any voting
or consent rights under or with respect to any Loan Document or (b) constitute a
"Lender" (or be included in the calculation of Required Lenders hereunder) for
any voting or consent rights under or with respect to any Loan Document.

         SECTION 5.8 Changed Circumstances.

         (a)      Circumstances Affecting LIBOR Rate Availability. If with
respect to any Interest Period the Administrative Agent or any Lender (after
consultation with the Administrative Agent) shall determine that, by reason of
circumstances affecting the foreign exchange and interbank markets generally,
deposits in eurodollars, in the applicable amounts are not being quoted via the
Dow Jones Market Screen 3750 or offered to the Administrative Agent or such
Lender for such Interest Period, then the Administrative Agent shall forthwith
give notice thereof to the Borrower. Thereafter, until the Administrative Agent
notifies the Borrower that such circumstances no longer exist, the obligation of
the Lenders to make LIBOR Rate Loans and the right of the Borrower to convert
any Loan to or continue any Loan as a LIBOR Rate Loan shall be suspended, and
the Borrower shall repay in full (or cause to be repaid in full) the then
outstanding principal amount of each such LIBOR Rate Loan together with accrued
interest thereon, on the last day of the then current Interest Period applicable
to such LIBOR Rate Loan or convert the then outstanding principal amount of each
such LIBOR Rate Loan to a Base Rate Loan as of the last day of such Interest
Period.

         (b)      Laws Affecting LIBOR Rate Availability. If, after the date
hereof, the introduction of, or any change in, any Applicable Law or any change
in the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any of the Lenders (or any of their
respective Lending Offices)

                                       35



with any request or directive (whether or not having the force of law) of any
such Governmental Authority, central bank or comparable agency, shall make it
unlawful or impossible for any of the Lenders (or any of their respective
Lending Offices) to honor its obligations hereunder to make or maintain any
LIBOR Rate Loan, such Lender shall promptly give notice thereof to the
Administrative Agent and the Administrative Agent shall promptly give notice to
the Borrower and the other Lenders. Thereafter, until the Administrative Agent
notifies the Borrower that such circumstances no longer exist, (i) the
obligations of the Lenders to make LIBOR Rate Loans and the right of the
Borrower to convert any Loan or continue any Loan as a LIBOR Rate Loan shall be
suspended and thereafter the Borrower may select only Base Rate Loans hereunder,
and (ii) if any of the Lenders may not lawfully continue to maintain a LIBOR
Rate Loan to the end of the then current Interest Period applicable thereto as a
LIBOR Rate Loan, the applicable LIBOR Rate Loan shall immediately be converted
to a Base Rate Loan for the remainder of such Interest Period.

         (c)      Increased Costs. If, after the date hereof, the introduction
of, or any change in, any Applicable Law, or in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any of the Lenders (or any of their respective Lending Offices) with any
request or directive (whether or not having the force of law) of such
Governmental Authority, central bank or comparable agency:

                  (i)      shall (except as provided in Section 5.11(e)) subject
any of the Lenders (or any of their respective Lending Offices) to any tax, duty
or other charge with respect to any Note, Letter of Credit or Application or
shall change the basis of taxation of payments to any of the Lenders (or any of
their respective Lending Offices) of the principal of or interest on any Note,
Letter of Credit or Application or any other amounts due under this Agreement in
respect thereof (except for changes in the rate of franchise tax or tax on the
overall net income of any of the Lenders or any of their respective Lending
Offices imposed by the jurisdiction in which such Lender is organized or is or
should be qualified to do business or such Lending Office is located); provided
that the Borrower shall not be obligated to pay any amounts pursuant to this
Section 5.8(c)(i) to the extent that such amounts are duplicative of any amounts
paid by the Borrower pursuant to Section 5.11; or

                  (ii)     shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the Board of Governors of
the Federal Reserve System), special deposit, insurance or capital or similar
requirement against assets of, deposits with or for the account of, or credit
extended by any of the Lenders (or any of their respective Lending Offices) or
shall impose on any of the Lenders (or any of their respective Lending Offices)
or the foreign exchange and interbank markets any other condition affecting any
Note; and the result of any of the foregoing events described in clause (i) or
(ii) above is to increase the costs to any of the Lenders of maintaining any
LIBOR Rate Loan or issuing or participating in Letters of Credit or to reduce
the yield or amount of any sum received or receivable by any of the Lenders
under this Agreement or under the Notes in respect of a LIBOR Rate Loan or
Letter of Credit or Application, then such Lender shall promptly notify the
Administrative Agent, and the Administrative Agent shall promptly notify the
Borrower of such fact and demand compensation therefor and, within fifteen (15)
days after such notice by the Administrative Agent, the Borrower shall pay to
such Lender such additional amount or amounts as will compensate such Lender or
Lenders for such increased cost or reduction. The Administrative Agent will
promptly notify the Borrower of any event of which it has knowledge which will
entitle such Lender to compensation pursuant to this Section 5.8(c); provided,
that the Administrative Agent shall incur no liability whatsoever to the Lenders
or the Borrower in the event it fails to do so. The amount of such compensation
shall be determined, in the applicable Lender's reasonable discretion, based
upon the assumption that such Lender funded its Revolving Credit Commitment
Percentage or Term Loan Percentage, as applicable, of the LIBOR Rate Loans in
the London interbank market and using any reasonable attribution or averaging
methods which such Lender reasonably deems appropriate and practical. A
certificate of such Lender setting forth the

                                       36



basis for determining such amount or amounts necessary to compensate such Lender
shall be forwarded to the Borrower through the Administrative Agent and shall be
conclusively presumed to be correct save for manifest error.

         SECTION 5.9 Indemnity. The Borrower hereby indemnifies each of the
Lenders against any actual loss or expense, as certified by such Lender, which
arises or is attributable to each Lender's obtaining, liquidating or employing
deposits or other funds acquired to effect, fund or maintain any Loan (a) as a
consequence of any failure by the Borrower to make any payment when due of any
amount due hereunder in connection with a LIBOR Rate Loan, (b) due to any
failure of the Borrower to borrow or continue any LIBOR Rate Loan or convert any
Base Rate Loan to a LIBOR Rate Loan on a date specified therefor in a Notice of
Borrowing or Notice of Conversion/Continuation or (c) due to any payment,
prepayment or conversion of any LIBOR Rate Loan on a date other than the last
day of the Interest Period therefor. The amount of such loss or expense shall be
determined, in the applicable Lender's sole discretion, based upon the
assumption that such Lender funded its Revolving Credit Commitment Percentage or
Term Loan Percentage, as applicable, of the LIBOR Rate Loans in the London
interbank market and using any reasonable attribution or averaging methods which
such Lender reasonably deems appropriate and practical. A certificate of such
Lender setting forth the basis for determining such amount or amounts necessary
to compensate such Lender shall be forwarded to the Borrower through the
Administrative Agent and shall be conclusively presumed to be correct save for
manifest error.

         SECTION 5.10 Capital Requirements. If either (a) the introduction of,
or any change in, or in the interpretation of, any Applicable Law or (b)
compliance with any guideline or request from any central bank or comparable
agency or other Governmental Authority (whether or not having the force of law),
has or would have the effect of reducing the rate of return on the capital of,
or has affected or would affect the amount of capital required to be maintained
by, any Lender or any corporation controlling such Lender as a consequence of
the Commitments and other commitments of this type or the LIBOR Rate Loans,
below the rate which such Lender or such other corporation could have achieved
but for such introduction, change or compliance, then within five (5) Business
Days after written demand by any such Lender, the Borrower shall pay to such
Lender from time to time as specified by such Lender additional amounts
sufficient to compensate such Lender or other corporation for such reduction. A
certificate as to such amounts submitted to the Borrower and the Administrative
Agent by such Lender, shall, in the absence of manifest error, be presumed to be
correct and binding for all purposes.

         SECTION 5.11 Taxes.

         (a)      Payments Free and Clear. Except as otherwise provided in
Section 5.11(e), any and all payments by the Borrower hereunder or under the
Notes or in respect of the Letters of Credit shall be made free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholding, and all liabilities with respect thereto
excluding, (i) in the case of each Lender and the Administrative Agent, income
and franchise taxes imposed by the jurisdiction under the laws of which such
Lender or the Administrative Agent (as the case may be) is organized or is or
should be qualified to do business or any political subdivision thereof and (ii)
in the case of each Lender, income and franchise taxes imposed by the
jurisdiction of such Lender's Lending Office or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If the
Borrower shall be required by law to deduct or withhold any Taxes from or in
respect of any sum payable hereunder or under any Note or in respect of any
Letter of Credit to any Lender or the Administrative Agent, (A) except as
otherwise provided in Section 5.11(e), the sum payable shall be increased as may
be necessary so that after making all required deductions or withholdings
(including deductions or withholdings applicable to additional sums payable
under this Section 5.11) such Lender or the Administrative Agent (as the case
may be) receives an amount equal to the amount such party would have received
had no such deductions or withholdings been made,

                                       37



(B) the Borrower shall make such deductions or withholdings, (C) the Borrower
shall pay the full amount deducted to the relevant taxing authority or other
authority in accordance with Applicable Law, and (D) the Borrower shall deliver
to the Administrative Agent and such Lender evidence of such payment to the
relevant taxing authority or other Governmental Authority in the manner provided
in Section 5.11(d).

         (b)      Stamp and Other Taxes. In addition, the Borrower shall pay any
present or future stamp, registration, recordation or documentary taxes or any
other similar fees or charges or excise or property taxes, levies of the United
States or any state or political subdivision thereof or any applicable foreign
jurisdiction which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Loans, the Letters of Credit or the other Loan Documents, or the perfection of
any rights or security interest in respect thereof (hereinafter referred to as
"Other Taxes").

         (c)      Indemnity. Except as otherwise provided in Section 5.11(e),
the Borrower shall indemnify each Lender and the Administrative Agent for the
full amount of Taxes and Other Taxes (including, without limitation, any Taxes
and Other Taxes imposed by any jurisdiction on amounts payable under this
Section 5.11) paid by such Lender or the Administrative Agent (as the case may
be) and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other Taxes were
correctly or legally asserted. Such indemnification shall be made within thirty
(30) days from the date such Lender or the Administrative Agent (as the case may
be) makes written demand therefor. A certificate of such Lender setting forth
the basis for determining such amount or amounts necessary to compensate such
Lender shall be forwarded to the Borrower through the Administrative Agent and
shall be conclusively presumed to be correct save for manifest error.

         (d)      Evidence of Payment. Within thirty (30) days after the date of
any payment of Taxes or Other Taxes, the Borrower shall furnish to the
Administrative Agent and the applicable Lender, at its address referred to in
Section 14.1, the original or a certified copy of a receipt evidencing payment
thereof or other evidence of payment satisfactory to the Administrative Agent.

         (e)      Delivery of Tax Forms. To the extent required by Applicable
Law to reduce or eliminate withholding or payment of taxes, each Lender and the
Administrative Agent shall deliver to the Borrower, with a copy to the
Administrative Agent, on or before the Closing Date or concurrently with the
delivery of the relevant Assignment and Acceptance, as applicable, (i) two
United States Internal Revenue Service Forms W-9, Forms W-8ECI or Forms W-8BEN,
as applicable (or successor forms) properly completed and certifying in each
case that such Lender is entitled to a complete exemption from withholding or
deduction for or on account of any United States federal income taxes, and (ii)
an Internal Revenue Service Form W-8BEN or W-8ECI or successor applicable form,
as the case may be, to establish an exemption from United States backup
withholding taxes. Each such Lender further agrees to deliver to the Borrower,
with a copy to the Administrative Agent, as applicable, two Form W-9, Form
W-8BEN or W-8ECI, or successor applicable forms or manner of certification, as
the case may be, on or before the date that any such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower, certifying in the case
of a Form W-9, Form W-8BEN or W-8ECI (or successor forms) that such Lender is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes (unless in any such case
an event (including, without limitation, any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders such forms inapplicable or the exemption to
which such forms relate unavailable and such Lender notifies the Borrower and
the Administrative Agent that it is not entitled to receive payments without
deduction or withholding of United States federal income taxes) and, in the case
of a Form W-9, Form W-8BEN or W-8ECI, establishing an exemption from United
States backup withholding tax. Notwithstanding

                                       38



anything in any Loan Document to the contrary, the Borrower shall not be
required to pay additional amounts to any Lender or the Administrative Agent
under Section 5.11 or Section 5.8(c), (i) if such Lender or the Administrative
Agent fails to comply with the requirements of this Section 5.11(e), other than
to the extent that such failure is due to a change in treaty, law or regulation
occurring after the date on which such Lender or the Administrative Agent became
a party to this Agreement or (ii) that are the result of such Lender's or the
Administrative Agent's gross negligence or willful misconduct, as applicable.

         (f)      Survival. Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and obligations of the
Borrower contained in this Section 5.11 shall survive the payment in full of the
Obligations and the termination of the Commitments.

         SECTION 5.12 Security. The Obligations shall be secured as provided in
the Security Documents.

                                   ARTICLE VI

                  CLOSING; CONDITIONS OF CLOSING AND BORROWING

         SECTION 6.1 Closing. The closing shall take place at 10:00 a.m. on July
9, 2003, or at such other date and time as the parties hereto shall mutually
agree.

         SECTION 6.2 Conditions to Closing. This Agreement shall become
effective as of the date hereof subject to the satisfaction of each of the
following conditions:

         (a)      Executed Loan Documents. This Agreement, the Revolving Credit
Notes, the Term Notes, the Swingline Note, the Security Documents, together with
any other applicable Loan Documents, shall have been duly authorized, executed
and delivered to the Administrative Agent by the parties thereto, shall be in
full force and effect and no Default or Event of Default shall exist thereunder,
and the Borrower shall have delivered original counterparts thereof to the
Administrative Agent.

         (b)      Closing Certificates; etc.

                  (i)      Officer's Certificate of the Borrower. The
Administrative Agent shall have received a certificate from a Responsible
Officer, in form and substance satisfactory to the Administrative Agent, to the
effect that all representations and warranties of the Borrower contained in this
Agreement and the other Loan Documents are true, correct and complete; that the
Borrower is not in violation of any of the covenants contained in this Agreement
and the other Loan Documents; that, after giving effect to the transactions
contemplated by this Agreement, no Default or Event of Default has occurred and
is continuing; and that the Borrower has satisfied each of the closing
conditions.

                  (ii)     Certificate of Secretary of the Borrower and
Guarantors. The Administrative Agent shall have received a certificate of the
secretary or assistant secretary of the Borrower and each Guarantor certifying
as to the incumbency and genuineness of the signature of each officer of the
Borrower and each Guarantor executing Loan Documents to which it is a party and
certifying that attached thereto is a true, correct and complete copy of (A) the
articles of incorporation of the Borrower and each Guarantor and all amendments
thereto, certified as of a recent date by the appropriate Governmental Authority
in its jurisdiction of incorporation, (B) the bylaws of the Borrower and each
Guarantor as in effect on the date of such certifications, (C) resolutions duly
adopted by the Board of Directors of the Borrower and each Guarantor authorizing
the borrowings contemplated hereunder and

                                       39



the execution, delivery and performance of this Agreement and the other Loan
Documents to which it is a party, and (D) each certificate required to be
delivered pursuant to Section 6.2(b)(iii).

                  (iii)    Certificates of Good Standing. The Administrative
Agent shall have received certificates as of a recent date of the good standing
of the Borrower and each Guarantor under the laws of its jurisdiction of
organization and, to the extent requested by the Administrative Agent, each
other jurisdiction where the Borrower is qualified to do business and a
certificate of the relevant taxing authorities of such jurisdictions certifying
that such Person has filed required tax returns and owes no delinquent taxes.

                  (iv)     Opinions of Counsel. The Administrative Agent shall
have received favorable opinions of counsel to the Borrower and the Guarantors
addressed to the Administrative Agent and the Lenders with respect to the
Borrower, the Guarantors, the Loan Documents and such other matters as the
Lenders shall request, all in form and substance reasonably satisfactory to the
Administrative Agent.

                  (v)      Tax Forms. The Administrative Agent shall have
received copies of the United States Internal Revenue Service forms required by
Section 5.11(e) hereof.

         (c)      Collateral.

                  (i)      Assignment of Existing Liens. The administrative
agent under the Existing Facility shall have assigned all of its right, title
and interest in and to the collateral under the Existing Facility to the
Administrative Agent under this Agreement pursuant to an instrument in form and
substance reasonably satisfactory to the Administrative Agent.

                  (ii)     Filings and Recordings. All filings and recordations
that are necessary to perfect the security interests of the Lenders in the
collateral described in the Security Documents (including, without limitation,
Assignment Agreements and Notices of Assignment executed by the applicable Loan
Party (but not the Governmental Authority party thereto) with respect to each
Material Government Contract existing as of the Closing Date) shall have been
received by the Administrative Agent and the Administrative Agent shall have
received evidence reasonably satisfactory thereto that upon such filings and
recordations such security interests constitute valid and perfected first
priority Liens therein.

                  (iii)    Pledged Collateral. The Administrative Agent shall
have received (A) original stock certificates or other certificates evidencing
the capital stock or other ownership interests pledged pursuant to the
Collateral Agreement (to the extent such ownership interests are certificated),
together with an undated stock power for each such certificate duly executed in
blank by the registered owner thereof and (B) each original promissory note
pledged pursuant to the Collateral Agreement.

                  (iv)     Lien Search. The Administrative Agent shall have
received the results of a Lien search (including a search as to judgments,
pending litigation and tax matters) made against the Borrower and each
Restricted Domestic Subsidiary under the UCC (or applicable judicial docket) as
in effect in any state in which each such Person is organized, indicating among
other things that its assets are free and clear of any Lien except for Liens
permitted hereunder or assigned in connection herewith.

                  (v)      Hazard and Liability Insurance. The Administrative
Agent shall have received certificates of insurance, evidence of payment of all
insurance premiums for the current policy year of each, and, if requested by the
Administrative Agent, copies (certified by a Responsible Officer) of insurance
policies in the form required under the Security Documents and otherwise in form
and substance reasonably satisfactory to the Administrative Agent.

                                       40



                  (vi)     Title Insurance. The existing policies of title
insurance on the properties subject to the Mortgage shall have been assigned to
the Administrative Agent, and the Administrative Agent shall have received
appropriate assignment and modification endorsements and datedowns with respect
to such policies. Further, the Borrower agrees to provide or obtain any
customary affidavits and indemnities as may be required or necessary to obtain
such endorsements and datedowns satisfactory to the Administrative Agent.

                  (vii)    Title Exceptions. The Administrative Agent shall have
received copies of all recorded documents creating exceptions to the title
policies referred to in Section 6.2(c)(vi) which have been filed since the
closing of the Existing Facility.

                  (viii)   Matters Relating to Flood Hazard Properties. The
Administrative Agent shall have received a copy of a certification from the
National Research Center, or any successor agency thereto, regarding each parcel
of real property subject to the Mortgages.

                  (ix)     Surveys. The Administrative Agent shall have received
copies of as-built surveys of a date not more than nine (9) months prior to the
Closing Date of each parcel of real property subject to the Mortgages certified
to the Administrative Agent by a registered engineer or land surveyor, provided,
however, that if such certification is not obtained prior to the Closing Date,
the Borrower shall provide such certification within forty-five (45) days of the
Closing Date (which requirement may be waived by the Administrative Agent in its
sole discretion). Each such survey shall be accompanied by an affidavit (a
"Survey Affidavit") of an authorized signatory of the owner of such property
stating that there have been no improvements or encroachments to the property
since the date of the respective survey such that the existing survey is no
longer accurate. Such survey shall show the area of such property, all
boundaries of the land with courses and distances indicated, including chord
bearings and arc and chord distances for all curves, and shall show dimensions
and locations of all easements, private drives, roadways, and other facts
materially affecting such property, and shall show such other details as the
Administrative Agent may reasonably request, including, without limitation, any
encroachment (and the extent thereof in feet and inches) onto the property or by
any of the improvements on the property upon adjoining land or upon any easement
burdening the property; any improvements, to the extent constructed, and the
relation of the improvements by distances to the boundaries of the property, to
any easements burdening the property, and to the established building lines and
the street lines; and if improvements are existing, (A) a statement of the
number of each type of parking space required by applicable laws, ordinances,
orders, rules, regulations, restrictive covenants and easements affecting the
improvement, and the number of each such type of parking space provided, and (B)
the locations of all utilities serving the improvement.

                  (x)      Environmental Assessments. The Administrative Agent
shall have received a Phase I environmental assessment and such other
environmental report reasonably requested by the Administrative Agent dated as
of a date not more than nine (9) months prior to the Closing Date regarding each
parcel of real property subject to the Mortgages by an environmental engineering
firm acceptable to the Administrative Agent showing no environmental conditions
or liabilities in violation of Environmental Laws that could reasonably be
expected to have a Material Adverse Effect, together with a reliance letter
confirming that the Administrative Agent may rely thereon; provided, however, if
such reliance letter is not obtained prior to the Closing Date, the Borrower
shall provide such reliance letter within forty-five (45) days of the Closing
Date (which requirement may be waived by the Administrative Agent in its sole
discretion).

                  (xi)     Appraisals. The Administrative Agent shall have
received appraisals dated as of a date not more than nine (9) months prior to
the Closing Date of each parcel of real property subject to the Mortgages, in
form and substance satisfactory to the Agents, together with a reliance letter
confirming

                                       41



that the Administrative Agent may rely thereon; provided, however, if such
reliance letter is not obtained prior to the Closing Date, the Borrower shall
provide such reliance letter within forty-five (45) days of the Closing Date
(which requirement may be waived by the Administrative Agent in its sole
discretion).

                  (xii)    Other Real Property Information. The Administrative
Agent shall have received such other certificates, documents and information as
are reasonably requested by the Lenders, including, without limitation,
engineering and structural reports, permanent certificates of occupancy and
evidence of zoning compliance, each in form and substance reasonably
satisfactory to the Administrative Agent.

         (d)      Consents; Defaults.

                  (i)      Governmental and Third Party Approvals. The Borrower
shall have obtained all necessary approvals, authorizations and consents of any
Person and of all Governmental Authorities and courts having jurisdiction with
respect to the transactions contemplated by this Agreement and the other Loan
Documents.

                  (ii)     No Injunction, Etc. No action, proceeding,
investigation, regulation or legislation shall have been instituted, threatened
or proposed before any Governmental Authority to enjoin, restrain, or prohibit,
or to obtain substantial damages in respect of, or which is related to or arises
out of this Agreement or the other Loan Documents or the consummation of the
transactions contemplated hereby or thereby, or which, in the Administrative
Agent's sole discretion, would make it inadvisable to consummate the
transactions contemplated by this Agreement and such other Loan Documents.

                  (iii)    No Event of Default. No Default or Event of Default
shall have occurred and be continuing.

         (e)      Financial Matters.

                  (i)      Financial Statements. The Administrative Agent shall
have received (A) the most recent audited Consolidated financial statements of
the Borrower and its Subsidiaries for each of the last three Fiscal Years, (B)
unaudited Consolidated interim financial statements of the Borrower and its
Subsidiaries for the fiscal quarter ended March 30, 2003, (C) a pro forma
balance sheet of the Borrower and its Subsidiaries as of the Closing Date giving
effect to the issuance of the indebtedness hereunder, the issuance of the
High-Yield Notes and the consummation of the Share Purchase and (D) projected
Consolidated financial statements (including balance sheets, income and cash
flow statements) of the Borrower and its Subsidiaries for a seven-year period
after the Closing Date, all in form and substance reasonably satisfactory to the
Administrative Agent.

                  (ii)     Financial Condition Certificate. The Borrower shall
have delivered to the Administrative Agent a certificate, in form and substance
satisfactory to the Administrative Agent, and certified as accurate by a
Responsible Officer, that (A) the Borrower and each of its Subsidiaries are each
Solvent, (B) the Borrower's payables are current and not past due, (C) attached
thereto are calculations evidencing compliance on a pro forma basis with the
covenants contained in Article X hereof, (D) the financial projections
previously delivered to the Administrative Agent represent the good faith
estimates (utilizing reasonable assumptions) of the financial condition and
operations of the Borrower and its Subsidiaries and (E) attached thereto is a
calculation of the Applicable Margin pursuant to Section 5.1(c).

                  (iii)    Payment at Closing; Fee Letters. The Borrower shall
have paid to the Administrative Agent and the Lenders the fees set forth or
referenced in Section 5.3 and any other accrued and unpaid fees or commissions
due hereunder (including, without limitation, reasonable legal

                                       42



fees and expenses) and to any other Person such amount as may be due thereto in
connection with the transactions contemplated hereby, including all taxes, fees
and other charges in connection with the execution, delivery, recording, filing
and registration of any of the Loan Documents.

         (f)      Senior Unsecured Debt. The Borrower shall have used its best
efforts to issue the High-Yield Notes and shall, in any event, have issued the
Senior Unsecured Debt and received the net proceeds thereof.

         (g)      Share Purchase. The Borrower shall have used a portion of the
price of the Senior Unsecured Debt to effect the Share Purchase.

         (h)      Paydown of Term Loans. The Borrower shall have repaid, on or
before the Closing Date, an amount of the term loans outstanding under the
Existing Facility so that the initial aggregate principal amount of Term Loans
outstanding under this Agreement will be $100,000,000.

         (i)      Miscellaneous.

                  (i)      Notice of Borrowing. The Administrative Agent shall
have received a Notice of Borrowing, as applicable, from the Borrower in
accordance with Section 2.3(a) and Section 4.2, and a Notice of Account
Designation specifying the account or accounts to which the proceeds of any
Loans made after the Closing Date are to be disbursed.

                  (ii)     WIH. The Borrower shall have formed WIH as a direct,
wholly-owned Subsidiary of the Borrower and shall have transferred all of the
outstanding capital stock of Wackenhut Corrections Corporation Australia, PTY
Ltd., Wackenhut Correction UK, Ltd. and WCC South Africa, PTY, Ltd. to WIH.

                  (iii)    Rating of the Facility and the Borrower. The Borrower
shall have received ratings from S&P and Moody's of, respectively, (A) at least
BB- and Ba3 on its senior secured debt and (B) at least B- and B3 on the
High-Yield Notes.

                  (iv)     Other Documents. All opinions, certificates and other
instruments and all proceedings in connection with the transactions contemplated
by this Agreement shall be satisfactory in form and substance to the Agents. The
Agents shall have received copies of all other documents, certificates and
instruments reasonably requested thereby, with respect to the transactions
contemplated by this Agreement.

         SECTION 6.3 Conditions to All Extensions of Credit. The obligations of
the Lenders to make any Extensions of Credit (including the initial Extension of
Credit), convert or continue any Loan and/or the Issuing Lender to issue or
extend any Letter of Credit and/or the Swingline Lender to make any Swingline
Loan are subject to the satisfaction of the following conditions precedent on
the relevant borrowing, continuation, conversion, issuance or extension date:

         (a)      Continuation of Representations and Warranties. The
representations and warranties contained in Article VII shall be true and
correct on and as of such borrowing, continuation, conversion, issuance or
extension date with the same effect as if made on and as of such date, except
for any representation and warranty made as of an earlier date, which
representation and warranty shall remain true and correct as of such earlier
date.

         (b)      No Existing Default. No Default or Event of Default shall have
occurred and be continuing (i) on the borrowing, continuation or conversion date
with respect to such Loan or after giving

                                       43



effect to the Loans to be made, continued or converted on such date or (ii) on
the issuance or extension date with respect to such Letter of Credit or after
giving effect to the issuance or extension of such Letter of Credit on such
date.

         (c)      Notices. The Administrative Agent shall have received a Notice
of Borrowing or Notice of Conversion/Continuation, as applicable, from the
Borrower in accordance with Section 2.3(a) and Section 4.2.

         (d)      Additional Documents. The Administrative Agent shall have
received each additional document, instrument, legal opinion or other item
reasonably requested by it.

                                  ARTICLE VII

                 REPRESENTATIONS AND WARRANTIES OF THE BORROWER

         SECTION 7.1 Representations and Warranties. To induce the
Administrative Agent and Lenders to enter into this Agreement and to induce the
Lenders to make Extensions of Credit, the Borrower hereby represents and
warrants to the Administrative Agent and Lenders both before and after giving
effect to the transactions contemplated hereunder that:

         (a)      Organization; Power; Qualification. Each of the Borrower and
its Subsidiaries is duly organized, validly existing and in good standing (or
its equivalent) under the laws of the jurisdiction of its incorporation or
formation, has the power and authority to own its properties and to carry on its
business as now being and hereafter proposed to be conducted and is duly
qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification and authorization, except where such failure to qualify could not
reasonably be expected to result in a Material Adverse Effect. The jurisdictions
in which the Borrower and its Subsidiaries are organized and qualified to do
business as of the Closing Date are described on Schedule 7.1(a).

         (b)      Ownership. Each Subsidiary of the Borrower as of the Closing
Date is listed on Schedule 7.1(b). As of the Closing Date, the capitalization of
the Borrower and its Subsidiaries consists of the number of shares, authorized,
issued and outstanding, of such classes and series, with or without par value,
described on Schedule 7.1(b). All outstanding shares have been duly authorized
and validly issued and are fully paid and nonassessable, with no personal
liability attaching to the ownership thereof, and not subject to any preemptive
or similar rights. The shareholders of the Subsidiaries of the Borrower and the
number of shares owned by each as of the Closing Date are described on Schedule
7.1(b). As of the Closing Date, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments or other rights of any
type or nature whatsoever, which are convertible into, exchangeable for or
otherwise provide for or permit the issuance of capital stock of the Borrower or
its Subsidiaries, except as described on Schedule 7.1(b).

         (c)      Authorization of Agreement, Loan Documents and Borrowing. Each
of the Borrower and its Restricted Subsidiaries has the right, power and
authority and has taken all necessary corporate and other action to authorize
the execution, delivery and performance of this Agreement and each of the other
Loan Documents to which it is a party in accordance with their respective terms.
This Agreement and each of the other Loan Documents have been duly executed and
delivered by the duly authorized officers of the Borrower and each of its
Subsidiaries party thereto, and each such document constitutes the legal, valid
and binding obligation of the Borrower or its Subsidiary party thereto,
enforceable in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar state
or federal debtor relief laws from time to time in effect which affect the
enforcement of creditors' rights in general and the availability of equitable
remedies.

                                       44



         (d)      Compliance of Agreement, Loan Documents and Borrowing with
Laws, Etc. The execution, delivery and performance by the Borrower and its
Subsidiaries of the Loan Documents to which each such Person is a party, in
accordance with their respective terms, the Extensions of Credit hereunder and
the transactions contemplated hereby do not and will not, by the passage of
time, the giving of notice or otherwise, (i) require any Governmental Approval
or violate any Applicable Law relating to the Borrower or any of its
Subsidiaries, (ii) conflict with, result in a breach of or constitute a default
under the articles of incorporation, bylaws or other organizational documents of
the Borrower or any of its Subsidiaries or, except as could not reasonably be
expected to result in a Material Adverse Effect, any indenture, agreement or
other instrument to which such Person is a party or by which any of its
properties may be bound or any Governmental Approval relating to such Person,
(iii) result in or require the creation or imposition of any Lien upon or with
respect to any property now owned or hereafter acquired by such Person other
than Liens arising under the Loan Documents or (iv) require any consent or
authorization of, filing with, or other act in respect of, an arbitrator or
Governmental Authority and no consent of any other Person is required in
connection with the execution, delivery, performance, validity or enforceability
of this Agreement except, in each case, (w) as may be required by laws affecting
the offering and sale of securities generally, (x) filings with the United
States Copyright Office and/or the United States Patent and Trademark Office,
(y) filings under the UCC and/or the Assignment of Claims Act (or analogous
state Applicable Law) and (z) those notices, consents and authorizations which
have been obtained prior to the Closing Date.

         (e)      Compliance with Law; Governmental Approvals. Each of the
Borrower and its Subsidiaries (i) has all Governmental Approvals required by any
Applicable Law for it to conduct its business, each of which is in full force
and effect, is final and not subject to review on appeal and is not the subject
of any pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, (ii) is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable Laws relating to it
or any of its respective properties and (iii) has timely filed all material
reports, documents and other materials required to be filed by it under all
Applicable Laws with any Governmental Authority and has retained all material
records and documents required to be retained by it under Applicable Law in each
case, except as could not reasonably be expected to result in a Material Adverse
Effect.

         (f)      Tax Returns and Payments. Each of the Borrower and its
Subsidiaries has duly filed or caused to be filed all federal, state, local and
other tax returns required by Applicable Law to be filed, and has paid, or made
adequate provision for the payment of, all federal, state, local and other
taxes, assessments and governmental charges or levies upon it and its property,
income, profits and assets which are due and payable except for such taxes,
assessments, charges and levies being contested in good faith by appropriate
proceedings. Such returns accurately reflect in all material respects all
liability for taxes of the Borrower and its Subsidiaries for the periods covered
thereby. There is no ongoing audit or examination or, to the knowledge of the
Borrower, other investigation by any Governmental Authority of the tax liability
of the Borrower and its Subsidiaries that could reasonably be expected to result
in a Material Adverse Effect. No Governmental Authority has asserted any Lien or
other claim against the Borrower or any Subsidiary thereof with respect to
unpaid taxes which has not been discharged or resolved other than any lien or
claim being contested in good faith by appropriate proceedings. The charges,
accruals and reserves on the books of the Borrower and any of its Subsidiaries
in respect of federal, state, local and other taxes for all Fiscal Years and
portions thereof since the organization of the Borrower and any of its
Subsidiaries are in the judgment of the Borrower adequate, and the Borrower does
not anticipate any additional taxes or assessments for any of such years.

         (g)      Intellectual Property Matters. Each of the Borrower and its
Restricted Subsidiaries owns or possesses rights to use all franchises,
licenses, copyrights, copyright applications, patents, patent rights or
licenses, patent applications, trademarks, trademark rights, service mark,
service mark rights, trade

                                       45



names, trade name rights, copyrights and rights with respect to the foregoing
which are required to conduct its business. No event has occurred which permits,
or after notice or lapse of time or both would permit, the revocation or
termination of any such rights, and neither the Borrower nor any Restricted
Subsidiary thereof is liable to any Person for infringement under Applicable Law
with respect to any such rights as a result of its business operations.

         (h)      Environmental Matters.

                  (i)      The properties owned, leased or operated by the
Borrower and its Subsidiaries now or in the past do not contain, and to their
knowledge have not previously contained, any Hazardous Materials in amounts or
concentrations which (A) constitute or constituted a violation of applicable
Environmental Laws or (B) could give rise to liability under applicable
Environmental Laws;

                  (ii)     The Borrower, each Subsidiary and such properties and
all operations conducted in connection therewith are in material compliance, and
have been in material compliance, with all applicable Environmental Laws, and
there is no contamination at, under or about such properties or such operations
which could interfere with the continued operation of such properties or impair
the fair saleable value thereof;

                  (iii)    Neither the Borrower nor any Subsidiary thereof has
received any written notification of any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters, Hazardous Materials, or compliance with Environmental Laws, nor does
the Borrower or any Subsidiary thereof have knowledge or reason to believe that
any such notice will be received or is being threatened;

                  (iv)     Hazardous Materials have not been transported or
disposed of to or from the properties owned, leased or operated by the Borrower
and its Subsidiaries in material violation of, or in a manner or to a location
which could give rise to material liability under, Environmental Laws, nor have
any Hazardous Materials been generated, treated, stored or disposed of at, on or
under any of such properties in material violation of, or in a manner that could
give rise to material liability under, any applicable Environmental Laws;

                  (v)      No judicial proceedings or governmental or
administrative action is pending, or, to the knowledge of the Borrower,
threatened, under any Environmental Law to which the Borrower or any Subsidiary
thereof is or will be named as a potentially responsible party with respect to
such properties or operations conducted in connection therewith, nor are there
any consent decrees or other decrees, consent orders, administrative orders or
other orders, or other administrative or judicial requirements outstanding under
any Environmental Law with respect to Borrower, any Subsidiary or such
properties or such operations; and

                  (vi)     There has been no release, or to the best of the
Borrower's knowledge, threat of release, of Hazardous Materials at or from
properties owned, leased or operated by the Borrower or any Subsidiary, now or
in the past, in violation of or in amounts or in a manner that could give rise
to liability under Environmental Laws.

         (i)      ERISA.

                  (i)      As of the Closing Date, neither the Borrower nor any
ERISA Affiliate maintains or contributes to, or has any obligation under, any
Employee Benefit Plans other than those identified on Schedule 7.1(i);

                                       46



                  (ii)     The Borrower and each ERISA Affiliate is in material
compliance with all applicable provisions of ERISA and the regulations and
published interpretations thereunder with respect to all Employee Benefit Plans
except for any required amendments for which the remedial amendment period as
described in Section 401(b) of the Code has not yet expired and except where a
failure to so comply could not reasonably be expected to have a Material Adverse
Effect. Each Employee Benefit Plan that is intended to be qualified under
Section 401(a) of the Code has been determined by the Internal Revenue Service
to be so qualified, and each trust related to such plan has been determined to
be exempt under Section 501(a) of the Code except for such plans that have not
yet received determination letters but for which the remedial amendment period
for submitting a determination letter has not yet expired. No liability has been
incurred by the Borrower or any ERISA Affiliate which remains unsatisfied for
any taxes or penalties with respect to any Employee Benefit Plan or any
Multiemployer Plan except for a liability that could not reasonably be expected
to have a Material Adverse Effect;

                  (iii)    As of the Closing Date, no Pension Plan has been
terminated, nor has any accumulated funding deficiency (as defined in Section
412 of the Code) been incurred (without regard to any waiver granted under
Section 412 of the Code), nor has any funding waiver from the Internal Revenue
Service been received or requested with respect to any Pension Plan, nor has the
Borrower or any ERISA Affiliate failed to make any contributions or to pay any
amounts due and owing as required by Section 412 of the Code, Section 302 of
ERISA or the terms of any Pension Plan prior to the due dates of such
contributions under Section 412 of the Code or Section 302 of ERISA, nor has
there been any event requiring any disclosure under Section 4041(c)(3)(C) or
4063(a) of ERISA with respect to any Pension Plan;

                  (iv)     Except where the failure of any of the following
representations to be correct in all material respects could not reasonably be
expected to have a Material Adverse Effect, neither the Borrower nor any ERISA
Affiliate has: (A) engaged in a nonexempt prohibited transaction described in
Section 406 of the ERISA or Section 4975 of the Code, (B) incurred any liability
to the PBGC which remains outstanding other than the payment of premiums and
there are no premium payments which are due and unpaid, (C) failed to make a
required contribution or payment to a Multiemployer Plan, or (D) failed to make
a required installment or other required payment under Section 412 of the Code;

                  (v)      No Termination Event has occurred or is reasonably
expected to occur; and

                  (vi)     Except where the failure of any of the following
representations to be correct in all material respects could not reasonably be
expected to have a Material Adverse Effect, no proceeding, claim (other than a
benefits claim in the ordinary course of business), lawsuit and/or investigation
is existing or, to the best knowledge of the Borrower after due inquiry,
threatened concerning or involving any (A) employee welfare benefit plan (as
defined in Section 3(1) of ERISA) currently maintained or contributed to by the
Borrower or any ERISA Affiliate, (B) Pension Plan or (C) Multiemployer Plan.

         (j)      Margin Stock. Neither the Borrower nor any Subsidiary thereof
is engaged principally or as one of its activities in the business of extending
credit for the purpose of "purchasing" or "carrying" any "margin stock" (as each
such term is defined or used, directly or indirectly, in Regulation U of the
Board of Governors of the Federal Reserve System). No part of the proceeds of
any of the Loans or Letters of Credit will be used for purchasing or carrying
margin stock or for any purpose which violates, or which would be inconsistent
with, the provisions of Regulation T, U or X of such Board of Governors.

         (k)      Government Regulation. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an "investment
company" (as each such term is defined or used in the Investment Company Act of
1940, as amended) and neither the Borrower nor any Subsidiary thereof is, or
after giving effect to any Extension of Credit will be, subject to regulation
under

                                       47



the Public Utility Holding Company Act of 1935 or the Interstate Commerce Act,
each as amended, or any other Applicable Law which limits its ability to incur
or consummate the transactions contemplated hereby.

         (l)      Material Contracts. Schedule 7.1(l) sets forth a complete and
accurate list of all Material Contracts of the Borrower and its Subsidiaries in
effect as of the Closing Date not listed on any other Schedule hereto; other
than as set forth in Schedule 7.1(l), each such Material Contract is, and after
giving effect to the consummation of the transactions contemplated by the Loan
Documents will be, in full force and effect in accordance with the terms
thereof. To the extent requested by the Administrative Agent, the Borrower and
its Subsidiaries have delivered to the Administrative Agent a true and complete
copy of each Material Contract required to be listed on Schedule 7.1(l) or any
other Schedule hereto. Neither the Borrower nor any Subsidiary (nor, to the
knowledge of the Borrower, any other party thereto) is in breach of or in
default under any Material Contract in any material respect.

         (m)      Employee Relations. Neither the Borrower nor any Restricted
Subsidiary is, as of the Closing Date, party to any collective bargaining
agreement nor has any labor union been recognized as the representative of its
employees except as set forth on Schedule 7.1(m). The Borrower knows of no
pending, threatened or contemplated strikes, work stoppage or other collective
labor disputes involving its employees or those of its Restricted Subsidiaries.

         (n)      Burdensome Provisions. Neither the Borrower nor any Subsidiary
thereof is a party to any indenture, agreement, lease or other instrument, or
subject to any corporate or partnership restriction, Governmental Approval or
Applicable Law which in the foreseeable future could be reasonably expected to
have a Material Adverse Effect. The Borrower and its Subsidiaries do not
presently anticipate that future expenditures needed to meet the provisions of
any statutes, orders, rules or regulations of a Governmental Authority will be
so burdensome as to have a Material Adverse Effect. No Subsidiary is party to
any agreement or instrument or otherwise subject to any restriction or
encumbrance that restricts or limits its ability to make dividend payments or
other distributions in respect of its capital stock to the Borrower or any
Subsidiary or to transfer any of its assets or properties to the Borrower or any
other Subsidiary in each case other than existing under or by reason of the Loan
Documents or Applicable Law.

         (o)      Financial Statements.

                  (i)      The (A) audited Consolidated balance sheet of the
Borrower and its Subsidiaries as of December 30, 2002 and the related audited
statements of income and retained earnings and cash flows for the Fiscal Year
then ended and (B) unaudited Consolidated balance sheet of the Borrower and its
Subsidiaries as of March 30, 2003 and related unaudited interim statements of
income and retained earnings, copies of which have been furnished to the
Administrative Agent, are complete and correct and fairly present on a
Consolidated basis the assets, liabilities and financial position of the
Borrower and its Subsidiaries as at such dates, and the results of the
operations and changes of financial position for the periods then ended (other
than customary year-end adjustments for unaudited financial statements). All
such financial statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP. The Borrower and its Subsidiaries
have no Debt, obligation or other unusual forward or long-term commitment which
is not fairly reflected in the foregoing financial statements or in the notes
thereto.

                  (ii)     The pro forma balance sheet of the Borrower and its
Subsidiaries delivered pursuant to Section 6.2(e)(i)(C) represents, as of the
Closing Date, the good faith estimate of the Borrower and its senior management
concerning the effect of the issuance of the indebtedness hereunder, the
issuance of the High-Yield Notes, the consummation of the Share Purchase and the
disposition by the Borrower of its ownership interest in PCG as contemplated
hereby.

                                       48



                  (iii)    The projected Consolidated financial statements of
the Borrower delivered pursuant to Section 6.2(e)(i)(D) represent, as of the
Closing Date, the good faith estimate of the Borrower and its senior management
based upon the assumptions set forth therein.

         (p)      No Material Adverse Change. Since December 30, 2002, there has
been no material adverse change in the properties, business, operations,
prospects, or condition (financial or otherwise) of the Borrower and its
Subsidiaries and no event has occurred or condition arisen that could reasonably
be expected to have a Material Adverse Effect.

         (q)      Solvency. As of the Closing Date and after giving effect to
the issuance of the Senior Unsecured Debt and the use of the proceeds thereof,
the Borrower and each of its Subsidiaries will be Solvent.

         (r)      Titles to Properties. Each of the Borrower and its
Subsidiaries has such title to the real property owned or leased by it as is
necessary or desirable to the conduct of its business and valid and legal title
to all of its personal property and assets, including, but not limited to, those
reflected on the balance sheets of the Borrower and its Subsidiaries delivered
pursuant to Section 7.1(o), except those which have been disposed of by the
Borrower or its Subsidiaries subsequent to such date which dispositions have
been in the ordinary course of business or as otherwise expressly permitted
hereunder. Schedule 7.1(r) is a complete and correct listing of real property
owned by the Borrower or any Restricted Domestic Subsidiary that has an
appraised value in excess of $1,000,000.

         (s)      Liens. None of the properties and assets of the Borrower or
any Subsidiary thereof is subject to any Lien, except Liens permitted pursuant
to Section 11.2. No financing statement under the UCC of any state which names
the Borrower or any Subsidiary thereof or any of their respective trade names or
divisions as debtor and which has not been terminated, has been filed in any
state or other jurisdiction and neither the Borrower nor any Subsidiary thereof
has signed any such financing statement or any security agreement authorizing
any secured party thereunder to file any such financing statement, except to
perfect those Liens permitted by Section 11.2 hereof and financing statements
filed solely for notification purposes by lessors and/or consignors.

         (t)      Debt and Guaranty Obligations. Schedule 7.1(t) is a complete
and correct listing of all Debt and Guaranty Obligations of the Borrower and its
Subsidiaries as of the Closing Date in excess of $1,000,000. The Borrower and
its Subsidiaries have performed and are in compliance with all of the material
terms of such Debt and Guaranty Obligations and all instruments and agreements
relating thereto, and no default or event of default, or event or condition
which with notice or lapse of time or both would constitute such a default or
event of default on the part of the Borrower or any of its Subsidiaries exists
with respect to any such Debt or Guaranty Obligation.

         (u)      Litigation. Except for matters existing on the Closing Date
and set forth on Schedule 7.1(u), there are no actions, suits or proceedings
pending nor, to the knowledge of the Borrower, threatened against or in any
other way relating adversely to or affecting the Borrower or any Subsidiary
thereof or any of their respective properties in any court or before any
arbitrator of any kind or before or by any Governmental Authority, in each case
except as could not reasonably be expected to result in a Material Adverse
Effect.

         (v)      Absence of Defaults. No event has occurred or is continuing
which constitutes a Default or an Event of Default, or which constitutes, or
which with the passage of time or giving of notice or both would constitute, a
default or event of default by the Borrower or any Restricted Subsidiary under
any Material Contract or judgment, decree or order to which the Borrower or its
Subsidiaries is a party or by which the Borrower or its Subsidiaries or any of
their respective properties may be bound or which would

                                       49



require the Borrower or its Subsidiaries to make any payment thereunder prior to
the scheduled maturity date therefor.

         (w)      Senior Debt Status. The Obligations of the Borrower and each
of its Subsidiaries under this Agreement and each of the other Loan Documents
ranks and shall continue to rank senior in priority of payment to all
Subordinated Debt of each such Person and is designated as "Senior Indebtedness"
under all instruments and documents, now or in the future, relating to all
Subordinated Debt of such Person.

         (x)      Accuracy and Completeness of Information. All written
information, reports and other papers and data produced by or on behalf of the
Borrower or any Subsidiary thereof (other than financial projections, which
shall be subject to the standard set forth in Section 8.1(c)) and furnished to
the Lenders were, at the time the same were so furnished, complete and correct
in all material respects to the extent necessary to give the recipient a true
and accurate knowledge of the subject matter. No document furnished or written
statement made to the Administrative Agent or the Lenders by the Borrower or any
Subsidiary thereof in connection with the negotiation, preparation or execution
of this Agreement or any of the Loan Documents contains or will contain any
untrue statement of a fact material to the creditworthiness of the Borrower or
its Subsidiaries or omits or will omit to state a fact necessary in order to
make the statements contained therein not misleading. The Borrower has disclosed
in writing to the Administrative Agent all pending claims or matters that could
reasonably be expected to have a Material Adverse Effect.

         SECTION 7.2 Survival of Representations and Warranties, Etc. All
representations and warranties set forth in this Article VII and all
representations and warranties contained in any certificate, or any of the Loan
Documents (including, but not limited to, any such representation or warranty
made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations
and warranties made under this Agreement shall be made or deemed to be made at
and as of the Closing Date (except those that are expressly made as of a
specific date), shall survive the Closing Date and shall not be waived by the
execution and delivery of this Agreement, any investigation made by or on behalf
of the Lenders or any borrowing hereunder.

                                  ARTICLE VIII

                        FINANCIAL INFORMATION AND NOTICES

         Until all the Obligations have been paid and satisfied in full and the
Commitments terminated, unless consent has been obtained in the manner set forth
in Section 14.11, the Borrower will furnish or cause to be furnished to the
Administrative Agent at the Administrative Agent's Office at the address set
forth in Section 14.1 and to the Lenders at their respective addresses as set
forth in the Register, or such other office as may be designated by the
Administrative Agent and Lenders from time to time:

         SECTION 8.1 Financial Statements and Projections.

         (a)      Quarterly Financial Statements. As soon as practicable and in
any event within fifty (50) days after the end of each of the first three fiscal
quarters of each Fiscal Year (or, if either such date is earlier, on the date of
any required public filing thereof, or five (5) days following any date on which
the Borrower may be required to file such statements), an unaudited Consolidated
balance sheet of the Borrower and its Subsidiaries as of the close of such
fiscal quarter and unaudited Consolidated statements of income, retained
earnings and cash flows for the fiscal quarter then ended and that portion of
the Fiscal Year then ended, including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures as of the end
of and for the corresponding period in the preceding Fiscal Year and

                                       50



prepared by the Borrower in accordance with GAAP and, if applicable, containing
disclosure of the effect on the financial position or results of operations of
any change in the application of accounting principles and practices during the
period, and certified by the chief financial officer or treasurer of the
Borrower to present fairly in all material respects the financial condition of
the Borrower and its Subsidiaries on a Consolidated basis as of their respective
dates and the results of operations of the Borrower and its Subsidiaries for the
respective periods then ended, subject to normal year end adjustments. Delivery
by the Borrower to the Administrative Agent for the benefit of the Lenders of
the Borrower's quarterly report to the SEC on Form 10-Q with respect to any
fiscal quarter within the period specified above shall be deemed to be
compliance by the Borrower with this Section 8.1(a).

         (b)      Annual Financial Statements. As soon as practicable and in any
event within ninety-five (95) days after the end of each Fiscal Year (or, if
either such date is earlier, on the date of any required public filing thereof,
or five (5) days following any date on which the Borrower may be required to
file such statements), an audited Consolidated balance sheet of the Borrower and
its Subsidiaries as of the close of such Fiscal Year and audited Consolidated
statements of income, retained earnings and cash flows for the Fiscal Year then
ended, including the notes thereto, all in reasonable detail setting forth in
comparative form the corresponding figures as of the end of and for the
preceding Fiscal Year and audited by an independent certified public accounting
firm acceptable to the Administrative Agent in accordance with GAAP and, if
applicable, containing disclosure of the effect on the financial position or
results of operations of any change in the application of accounting principles
and practices during the year, and accompanied by a report thereon by such
certified public accountants that is not qualified with respect to scope
limitations imposed by the Borrower or any of its Subsidiaries or with respect
to accounting principles followed by the Borrower or any of its Subsidiaries not
in accordance with GAAP. Delivery by the Borrower to the Administrative Agent
for the benefit of the Lenders of the Borrower's annual report to the SEC on
Form 10-K with respect to any fiscal year within the period specified above
shall be deemed to be compliance by the Borrower with this Section 8.1(b).

         (c)      Annual Business Plan and Financial Projections. As soon as
practicable and in any event within fifteen (15) days prior to the beginning of
each Fiscal Year commencing for Fiscal Year 2004, a business plan of the
Borrower and its Subsidiaries for the ensuing Fiscal Year, such plan to be
prepared in accordance with GAAP and to include the following: an operating and
capital budget, a projected income statement, statement of cash flows and
balance sheet and a report containing management's discussion and analysis of
such projections, accompanied by a certificate from the chief financial officer
or treasurer of the Borrower to the effect that, to the best of such officer's
knowledge, such projections are good faith estimates (utilizing reasonable
assumptions) of the financial condition and operations of the Borrower and its
Subsidiaries for such four (4) quarter period.

         SECTION 8.2 Officer's Compliance Certificate. At each time financial
statements are delivered pursuant to Sections 8.1(a) or (b) and at such other
times as the Administrative Agent shall reasonably request, a certificate of the
chief financial officer or the treasurer of the Borrower in the form of Exhibit
F attached hereto (an "Officer's Compliance Certificate").

         SECTION 8.3 Annual Accountants' Certificate. At each time financial
statements are delivered pursuant to Section 8.1(b), a certificate of the
independent public accountants certifying such financial statements addressed to
the Administrative Agent for the benefit of the Lenders:

         (a)      stating that in making the examination necessary for the
certification of such financial statements, they obtained no knowledge of any
Default or Event of Default or, if such is not the case, specifying such Default
or Event of Default and its nature and period of existence; and

                                       51



         (b)      including the calculations reviewed by such accountants in
connection with their audit of the Consolidated financial statements required to
establish whether or not the Borrower and its Subsidiaries are in compliance
with the financial covenants set forth in Article X hereof as at the end of each
respective period.

         SECTION 8.4 Other Reports.

         (a)      Promptly upon receipt thereof, copies of all material reports,
if any, submitted to the Borrower or its Board of Directors by its independent
public accountants in connection with their auditing function, including,
without limitation, any management report and any management responses thereto;
and

         (b)      Such other information regarding the operations, business
affairs and financial condition of the Borrower or any of its Subsidiaries as
the Administrative Agent or any Lender may reasonably request.

         SECTION 8.5 Notice of Litigation and Other Matters. Prompt (but in no
event later than ten (10) days after an officer of the Borrower obtains
knowledge thereof) telephonic and written notice of:

         (a)      the commencement of all proceedings and investigations by or
before any Governmental Authority and all actions and proceedings in any court
or before any arbitrator against or involving the Borrower or any Subsidiary
thereof or any of their respective properties, assets or businesses which could
reasonably be determined to result in a Material Adverse Effect;

         (b)      any notice of any material violation received by the Borrower
or any Subsidiary thereof from any Governmental Authority including, without
limitation, any notice of material violation of Environmental Laws;

         (c)      any labor controversy that has resulted in, or threatens to
result in, a strike or other work action against the Borrower or any Subsidiary
thereof which could reasonably be determined to result in a Material Adverse
Effect;

         (d)      any attachment, judgment, lien, levy or order exceeding
$1,000,000 that may be assessed against the Borrower or any Subsidiary thereof;

         (e)      (i) any Default or Event of Default, or (ii) any event which
constitutes or which with the passage of time or giving of notice or both would
constitute a default or event of default under any Material Contract to which
the Borrower or any of its Subsidiaries is a party or by which the Borrower or
any Subsidiary thereof or any of their respective properties may be bound;

         (f)      (i) any unfavorable determination letter from the Internal
Revenue Service regarding the qualification of an Employee Benefit Plan under
Section 401(a) of the Code (along with a copy thereof), (ii) all notices
received by the Borrower or any ERISA Affiliate of the PBGC's intent to
terminate any Pension Plan or to have a trustee appointed to administer any
Pension Plan, (iii) all notices received by the Borrower or any ERISA Affiliate
from a Multiemployer Plan sponsor concerning the imposition or amount of
withdrawal liability pursuant to Section 4202 of ERISA and (iv) the Borrower
obtaining knowledge or reason to know that the Borrower or any ERISA Affiliate
has filed or intends to file a notice of intent to terminate any Pension Plan
under a distress termination within the meaning of Section 4041(c) of ERISA;

                                       52



         (g)      contemporaneously with the delivery of the quarterly reports
required herein, (and, upon the occurrence and during the continuation of an
Event of Default, on a more frequent basis if requested by the Administrative
Agent), a list of all Material Government Contracts which have (i) been
completed or have lapsed or terminated and not renewed or (ii) been entered
into, in each case, since the most recent list provided by the Borrower and
signed by a Responsible Officer of the Borrower as of the last Business Day of
such fiscal quarter; and

         (h)      any event which makes any of the representations set forth in
Section 7.1 inaccurate in any respect.

         SECTION 8.6 Accuracy of Information. All written information, reports,
statements and other papers and data furnished by or on behalf of the Borrower
to the Administrative Agent or any Lender whether pursuant to this Article VIII
or any other provision of this Agreement, or any of the Security Documents,
shall, at the time the same is so furnished, comply with the representations and
warranties set forth in Section 7.1(x).

                                   ARTICLE IX

                              AFFIRMATIVE COVENANTS

         Until all of the Obligations have been paid and satisfied in full and
the Commitments terminated, unless consent has been obtained in the manner
provided for in Section 14.11, the Borrower will, and will cause each of its
Restricted Subsidiaries to:

         SECTION 9.1 Preservation of Corporate Existence and Related Matters.
Except as permitted by Section 11.4, preserve and maintain its separate
corporate existence and all rights, franchises, licenses and privileges
necessary to the conduct of its business, and qualify and remain qualified as a
foreign corporation and authorized to do business in each jurisdiction in which
the failure to so qualify could reasonably be expected to have a Material
Adverse Effect.

         SECTION 9.2 Maintenance of Property. In addition to the requirements of
any of the Security Documents, protect and preserve all properties useful in and
material to its business, including copyrights, patents, trade names, service
marks and trademarks; maintain in good working order and condition all
buildings, equipment and other tangible real and personal property; and from
time to time make or cause to be made all renewals, replacements and additions
to such property necessary for the conduct of its business, so that the business
carried on in connection therewith may be conducted in a commercially reasonable
matter.

         SECTION 9.3 Insurance. Maintain insurance (including, without
limitation, hazard and business interruption) with financially sound and
reputable insurance companies against such risks and in such amounts as are
customarily maintained by similar businesses and as may be required by
Applicable Law and as are required by any Security Documents, and on the Closing
Date and from time to time thereafter deliver to the Administrative Agent upon
its request a detailed list of the insurance then in effect, stating the names
of the insurance companies, the amounts and rates of the insurance, the dates of
the expiration thereof and the properties and risks covered thereby.

         SECTION 9.4 Accounting Methods and Financial Records. Maintain a system
of accounting, and keep such books, records and accounts (which shall be true
and complete in all material respects) as may be required or as may be necessary
to permit the preparation of financial statements in accordance with GAAP and in
compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.

                                       53



         SECTION 9.5 Payment and Performance of Obligations. Pay and perform all
Obligations under this Agreement and the other Loan Documents, and pay or
perform (a) all taxes, assessments and other governmental charges that may be
levied or assessed upon it or any of its property, and (b) all other
indebtedness, obligations and liabilities in accordance with customary trade
practices; provided, that the Borrower or such Restricted Subsidiary may contest
any item described in clauses (a) or (b) of this Section 9.5 in good faith so
long as adequate reserves are maintained with respect thereto in accordance with
GAAP.

         SECTION 9.6 Compliance With Laws and Approvals. Observe and remain in
compliance in all material respects with all Applicable Laws and maintain in
full force and effect all material Governmental Approvals, in each case
applicable to the conduct of its business.

         SECTION 9.7 Environmental Laws. In addition to and without limiting the
generality of Section 9.6, (a) materially comply with, and ensure such material
compliance by all tenants and subtenants with all applicable Environmental Laws
and obtain and comply with and maintain, and ensure that all tenants and
subtenants, if any, obtain and comply with and maintain, any and all licenses,
approvals, notifications, registrations or permits required by applicable
Environmental Laws, (b) conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required under
Environmental Laws, and promptly comply with all lawful orders and directives of
any Governmental Authority regarding Environmental Laws, and (c) defend,
indemnify and hold harmless the Administrative Agent and the Lenders, and their
respective parents, Subsidiaries, Affiliates, employees, agents, officers and
directors, from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or relating to the presence of
Hazardous Materials, or the violation of, noncompliance with or liability under
any Environmental Laws applicable to the operations of the Borrower or any such
Restricted Subsidiary, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable
attorney's and consultant's fees, investigation and laboratory fees, response
costs, court costs and litigation expenses, except to the extent that any of the
foregoing directly result from the gross negligence or willful misconduct of the
party seeking indemnification therefor.

         SECTION 9.8 Compliance with ERISA. In addition to and without limiting
the generality of Section 9.6, (a) except where the failure to so comply could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, (i) comply with all material applicable provisions of ERISA and
the regulations and published interpretations thereunder with respect to all
Employee Benefit Plans, (ii) not take any action or fail to take action the
result of which could be a liability to the PBGC or to a Multiemployer Plan,
(iii) not participate in any prohibited transaction that could result in any
civil penalty under ERISA or tax under the Code and (iv) operate each Employee
Benefit Plan in such a manner that will not incur any tax liability under
Section 4980B of the Code or any liability to any qualified beneficiary as
defined in Section 4980B of the Code and (b) furnish to the Administrative Agent
upon the Administrative Agent's request such additional information about any
Employee Benefit Plan as may be reasonably requested by the Administrative
Agent.

         SECTION 9.9 Compliance With Agreements. Comply in all respects with
each material term, condition and provision of all leases, agreements and other
instruments entered into in the conduct of its business including, without
limitation, any Material Contract; provided, that the Borrower or any such
Restricted Subsidiary may contest any such lease, agreement or other instrument
in good faith through applicable proceedings so long as adequate reserves are
maintained in accordance with GAAP.

         SECTION 9.10 Visits and Inspections. Permit representatives of the
Administrative Agent or any Lender, from time to time (during regular business
hours upon advance notice, provided no Default or

                                       54



Event of Default is continuing), to visit and inspect its properties; inspect,
audit and make extracts from its books, records and files, including, but not
limited to, management letters prepared by independent accountants; and discuss
with its principal officers, and its independent accountants, its business,
assets, liabilities, financial condition, results of operations and business
prospects.

         SECTION 9.11 Additional Subsidiaries.

         (a)      Additional Domestic Subsidiaries. Notify the Administrative
Agent of (i) the redesignation of an Unrestricted Subsidiary as a Restricted
Subsidiary in accordance with Section 9.11(c) below or (ii) the creation or
acquisition of any Domestic Subsidiary, and (unless such Domestic Subsidiary has
been designated as an Unrestricted Subsidiary pursuant to Section 9.11(d))
promptly thereafter (and in any event within thirty (30) days), cause such
Person to (A) become a Guarantor by executing and delivering to the
Administrative Agent a supplement to the Guaranty Agreement or such other
document as the Administrative Agent shall deem appropriate for such purpose,
(B) deliver to the Administrative Agent a duly executed Joinder Agreement and
comply with the terms of each Security Document, (C) deliver to the
Administrative Agent documents of the types referred to in clauses (ii) and
(iii) of Section 6.2(b) and favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding effect and
enforceability of the documentation referred to in clauses (A) and (B)) and (D)
deliver to the Administrative Agent such other documents and closing
certificates as may be reasonably requested by the Administrative Agent, all in
form, content and scope reasonably satisfactory to the Administrative Agent.

         (b)      Additional Foreign Subsidiaries. Notify the Administrative
Agent at the time that any Person becomes a first tier Foreign Subsidiary of the
Borrower or any Restricted Subsidiary, and at the request of the Administrative
Agent, promptly thereafter (and in any event within forty-five (45) days after
such request), cause (i) the Borrower or applicable Restricted Subsidiary to
deliver to the Administrative Agent a supplement to the Security Documents
pledging sixty-five percent (65%) of the total outstanding ownership interest or
capital stock of such new Foreign Subsidiary and a consent thereto executed by
such new Foreign Subsidiary (including, without limitation, if applicable,
original stock certificates (or the equivalent thereof pursuant to the
Applicable Laws and practices of any relevant foreign jurisdiction) evidencing
the capital stock of such new Foreign Subsidiary, together with an appropriate
undated stock power for each certificate duly executed in blank by the
registered owner thereof), (ii) the Borrower or such Restricted Subsidiary to
deliver to the Administrative Agent a favorable opinion of counsel (which shall
cover, among other things, the legality, validity, binding effect and
enforceability of such pledge), and (iii) such Person to deliver to the
Administrative Agent such other documents and closing certificates as may be
reasonably requested by the Administrative Agent, all in form, content and scope
reasonably satisfactory to the Administrative Agent.

         (c)      Redesignation of Unrestricted Subsidiaries. The Borrower may,
at any time and upon written notice to the Administrative Agent, redesignate an
Unrestricted Subsidiary as a Restricted Subsidiary. Further, promptly after the
date on which the Borrower or the Administrative Agent determines that all
Unrestricted Subsidiaries and their respective Subsidiaries represent ten
percent (10%) or more of the Consolidated EBITDA of the Borrower and its
Subsidiaries (notwithstanding the definition thereof, calculated to include all
Unrestricted Subsidiaries) for the four (4) consecutive fiscal quarters most
recently ended prior to such date, then the Borrower shall promptly identify in
writing to the Administrative Agent such Unrestricted Subsidiaries to be
redesignated as Restricted Subsidiaries to cause such remaining Unrestricted
Subsidiaries and their Subsidiaries (after giving effect to such redesignation)
to represent less than ten percent (10%) of the Consolidated EBITDA of the
Borrower and its Subsidiaries (notwithstanding the definition thereof,
calculated to include all Unrestricted Subsidiaries) for the four (4)
consecutive fiscal quarters most recently ended prior to such date.

                                       55



         (d)      Designation of Restricted Subsidiaries. So long as no Default
or Event of Default has occurred and is continuing, the Borrower shall be
permitted, on prior written notice to the Administrative Agent, to redesignate
any Restricted Subsidiary as an Unrestricted Subsidiary (or designate any newly
formed or acquired Subsidiary as an Unrestricted Subsidiary; provided that such
formation or acquisition is otherwise permitted hereunder), so long as the
Administrative Agent reasonably determines that at the time of such proposed
designation (or redesignation, as applicable), and after giving effect thereto,
all Unrestricted Subsidiaries and their respective Subsidiaries (including the
Subsidiary and its respective Subsidiaries to be designated or redesignated, as
applicable, as an Unrestricted Subsidiary) represent no more than ten percent
(10%) of the Consolidated EBITDA of the Borrower and its Subsidiaries
(notwithstanding the definition thereof, calculated to include all Unrestricted
Subsidiaries) for the four (4) consecutive fiscal quarters most recently ended
prior to such date. Such designation (or redesignation, as applicable) shall
have an effective date mutually acceptable to the Administrative Agent and
Borrower, but in no event earlier than five (5) Business Days following receipt
by the Administrative Agent of such written notice.

         SECTION 9.12 Use of Proceeds. The Borrower shall use the proceeds of
the Extensions of Credit (a) to finance the acquisition of Capital Assets, (b)
to refinance the Existing Facility, (c) to fund Restricted Payments permitted
hereunder, and (d) for working capital and general corporate requirements of the
Borrower and its Subsidiaries and payment of certain fees and expenses incurred
in connection with the transactions contemplated hereby.

         SECTION 9.13 Landlord Consents. Promptly after the Closing Date, the
Borrower shall diligently pursue and use all reasonable efforts to obtain
landlord consents, estoppel letters or consents and waivers, in form and
substance reasonably acceptable to the Administrative Agent, in respect of
Collateral held on leased premises.

         SECTION 9.14 Further Assurances. Make, execute and deliver all such
additional and further acts, things, deeds and instruments as the Administrative
Agent or the Required Lenders (through the Administrative Agent) may reasonably
require to document and consummate the transactions contemplated hereby and to
vest completely in and insure the Administrative Agent and the Lenders their
respective rights under this Agreement, the Notes, the Letters of Credit and the
other Loan Documents.

                                   ARTICLE X

                               FINANCIAL COVENANTS

         Until all of the Obligations have been paid and satisfied in full and
the Commitments terminated, unless consent has been obtained in the manner set
forth in Section 14.11, the Borrower and its Restricted Subsidiaries on a
Consolidated basis will not:

         SECTION 10.1 Leverage Ratios.

         (a)      Total Leverage Ratio. As of any fiscal quarter end, permit the
ratio (the "Total Leverage Ratio") of (i) the sum of (A) Debt of the Borrower
and its Restricted Subsidiaries on such date (other than any Non-Recourse
Project Financing Indebtedness), less (B) any undrawn Letters of Credit and cash
on hand of the Borrower and its Restricted Subsidiaries, to (ii) EBITDA for the
period of four (4) consecutive fiscal quarters ending on or immediately prior to
such date to be greater than the corresponding ratio set forth below:

                                       56





               PERIOD                                                           MAXIMUM RATIO
               ------                                                           -------------
                                                                             
Closing Date through March 27, 2004                                             3.50 to 1.00

March 28, 2004 through September 25, 2004                                       3.25 to 1.00

September 26, 2004 through July 2, 2005                                         3.00 to 1.00

July 3, 2005 through July 1, 2006                                               2.75 to 1.00

July 2, 2006 and thereafter                                                     2.50 to 1.00


         (b)      Senior Secured Leverage Ratio. As of any fiscal quarter end,
permit the ratio (the "Senior Secured Leverage Ratio") of (i) the sum of (A)
Debt of the Borrower incurred under this Agreement plus, without duplication,
other secured Debt of the Borrower and the Restricted Subsidiaries on such date
(other than any Non-Recourse Project Financing Indebtedness), less (B) any
undrawn Letters of Credit and cash on hand of the Borrower and its Restricted
Subsidiaries, to (ii) EBITDA for the period of four (4) consecutive fiscal
quarters ending on or immediately prior to such date to be greater than the
corresponding ratio set forth below:



                 PERIOD                                                         MAXIMUM RATIO
                 ------                                                         -------------
                                                                             
Closing Date through September 25, 2004                                         1.75 to 1.00

September 26, 2004 and thereafter                                               1.50 to 1.00


         SECTION 10.2 Fixed Charge Coverage Ratio. As of any fiscal quarter end,
permit the ratio of (a) the sum of (i) EBITDA for the period of four (4)
consecutive fiscal quarters ending on such date, plus (ii) Rental Expense (other
than Rental Expense related to Synthetic Leases), less (iii) Capital
Expenditures (excluding (x) the purchase of assets listed on Schedule
4.4(b)(iii), and (y) any acquisitions permitted under Section 11.3(a)), to (b)
the sum of (i) Interest Expense paid in cash, (ii) any federal, state or local
income taxes paid in cash (excluding cash taxes paid in respect of the sale of
PCG) by the Borrower and its Restricted Subsidiaries, (iii) scheduled principal
payments required to be made by the Borrower and its Restricted Subsidiaries
with respect to Debt, (iv) Rental Expense (other than Rental Expense related to
Synthetic Leases) and (v) Restricted Payments (excluding payments for the
repurchase of Parent Shares permitted pursuant to Section 11.6), in each case
for the period of four (4) consecutive fiscal quarters ending on such date to be
less than 1.10 to 1.00.

         SECTION 10.3 Capital Expenditures. Permit Capital Expenditures to be
greater than $10,000,000 in the aggregate during any Fiscal Year; provided,
however, any acquisition permitted under Section 11.3(a) shall not be included
in the calculation of Capital Expenditures. Notwithstanding the foregoing, the
maximum amount of Capital Expenditures permitted by this Section 10.3 in any
Fiscal Year shall be increased by the amount of Capital Expenditures that were
permitted to be made under this Section 10.3 in the immediately preceding Fiscal
Year (without giving effect to any carryover amount from prior Fiscal Years)
over the amount of Capital Expenditures actually made during such preceding
Fiscal Year.

         SECTION 10.4 Minimum Net Worth. As of any fiscal quarter end, permit
Net Worth for the fiscal quarter ending on or immediately prior to such date to
be less than the sum of (a) $140,000,000, plus (b) the net gain from the sale of
PCG, less (c) the amount of the Share Purchase, plus (d) an amount equal to
fifty percent (50%) of the Consolidated Net Income earned in each full fiscal
quarter ending after the Closing Date (with no deduction for a net loss in any
such fiscal quarter), plus (e) an amount equal to

                                       57



fifty percent (50%) of the aggregate increases in Consolidated shareholders'
equity of the Borrower and its Restricted Subsidiaries after the Closing Date by
reason of the issuance and sale of capital stock or other equity interests of
the Borrower or any Restricted Subsidiary (other than issuances to the Borrower
or a Wholly-Owned Restricted Subsidiary), including upon any conversion of debt
securities of the Borrower into such capital stock or other equity interests.

                                   ARTICLE XI

                               NEGATIVE COVENANTS

         Until all of the Obligations have been paid and satisfied in full and
the Commitments terminated, unless consent has been obtained in the manner set
forth in Section 14.11, the Borrower has not and will not and will not permit
any of its Restricted Subsidiaries to:

         SECTION 11.1 Limitations on Debt. Create, incur, assume or suffer to
exist any Debt except:

         (a)      the Obligations (excluding Hedging Agreements permitted
pursuant to Section 11.1(b));

         (b)      Debt incurred in connection with a Hedging Agreement with a
counterparty and upon terms and conditions (including interest rate) reasonably
satisfactory to the Administrative Agent; provided, that any counterparty that
is a Lender shall be deemed satisfactory to the Administrative Agent;

         (c)      (i) Debt existing on the Closing Date and not otherwise
permitted under this Section 11.1, as set forth on Schedule 7.1(t), and the
renewal, refinancing, extension and replacement (but not the increase in the
aggregate principal amount) thereof, (ii) any Non-Recourse Project Financing
Indebtedness and (iii) the Senior Unsecured Debt and the renewal, refinancing,
extension and replacement (but not the increase in the aggregate principal
amount or any decrease in the weighted average life) thereof;

         (d)      Debt of the Borrower and its Restricted Subsidiaries incurred
in connection with Capitalized Leases in an aggregate amount not to exceed
$3,000,000 on any date of determination;

         (e)      purchase money Debt of the Borrower and its Restricted
Subsidiaries in an aggregate amount not to exceed $3,000,000 on any date of
determination;

         (f)      Guaranty Obligations in favor of the Administrative Agent for
the benefit of the Administrative Agent and the Lenders;

         (g)      Debt in an aggregate principal amount not to exceed $5,000,000
at any time outstanding;

         (h)      Debt arising from intercompany loans from the Borrower to any
Restricted Subsidiary or from any Restricted Subsidiary to the Borrower; and

         (i)      Guaranty Obligations of the Borrower and its Restricted
Subsidiaries with respect to Debt permitted pursuant to this Section 11.1.

provided, that (x) no agreement or instrument with respect to Debt permitted to
be incurred by this Section (other than the High-Yield Note Indenture) shall
restrict, limit or otherwise encumber (by covenant or otherwise) the ability of
any Subsidiary of the Borrower to make any payment to the Borrower or any of its
Subsidiaries (in the form of dividends, intercompany advances or otherwise) for

                                       58



the purpose of enabling the Borrower to pay the Obligations and (y) in no event
shall WIH incur, assume or suffer to exist any Debt.

         SECTION 11.2 Limitations on Liens. Create, incur, assume or suffer to
exist, any Lien on or with respect to any of its assets or properties
(including, without limitation, shares of capital stock or other ownership
interests), real or personal, whether now owned or hereafter acquired, except:

         (a)      Liens for taxes, assessments and other governmental charges or
levies (excluding any Lien imposed pursuant to any of the provisions of ERISA or
Environmental Laws) not yet due or as to which the period of grace, if any,
related thereto has not expired or which are being contested in good faith and
by appropriate proceedings if adequate reserves are maintained to the extent
required by GAAP;

         (b)      the claims of materialmen, mechanics, carriers, warehousemen,
processors or landlords for labor, materials, supplies or rentals incurred in
the ordinary course of business, (i) which are not overdue for a period of more
than thirty (30) days or (ii) which are being contested in good faith and by
appropriate proceedings;

         (c)      Liens consisting of deposits or pledges made in the ordinary
course of business in connection with, or to secure payment of, obligations
under workers' compensation, unemployment insurance or similar legislation;

         (d)      Liens constituting encumbrances in the nature of zoning
restrictions, easements and rights or restrictions of record on the use of real
property, which in the aggregate are not substantial in amount and which do not,
in any case, materially detract from the value of such property or impair the
use thereof in the ordinary conduct of business;

         (e)      Liens of the Administrative Agent for the benefit of the
Administrative Agent and the Lenders;

         (f)      Liens not otherwise permitted by this Section 11.2 and in
existence on the Closing Date and described on Schedule 11.2, and any renewals
or extensions thereof, provided that the property covered thereby is not
increased and any renewal or extension of the obligations secured or benefited
thereby is permitted by Section 11.1(c)(i);

         (g)      Liens securing Debt permitted under Sections 11.1(d) and (e);
provided that (i) such Liens shall be created substantially simultaneously with
the acquisition or lease of the related asset, (ii) such Liens do not at any
time encumber any property other than the property financed by such Debt, (iii)
the amount of Debt secured thereby is not increased and (iv) the principal
amount of Debt secured by any such Lien shall at no time exceed one hundred
percent (100%) of the original purchase price or lease payment amount of such
property at the time it was acquired;

         (h)      other Liens securing Debt permitted by Section 11.1(g), not to
exceed $2,000,000 in the aggregate; and

         (i)      Liens securing Non-Recourse Project Financing Indebtedness.

         SECTION 11.3 Limitations on Loans, Advances, Investments and
Acquisitions. Purchase, own, invest in or otherwise acquire, directly or
indirectly, any capital stock, interests in any partnership or joint venture
(including, without limitation, the creation or capitalization of any Restricted
Subsidiary), evidence of Debt or other obligation or security, substantially all
of the business or assets of any other

                                       59



Person or any other investment or interest whatsoever in any other Person, or
make or permit to exist, directly or indirectly, any loans, advances or
extensions of credit to, or any investment in cash or by delivery of property
in, any Person except:

         (a)      (i) investments in or loans, advances or extensions of credit
to, Subsidiaries existing on the Closing Date, (ii) investments in or loans,
advances or extensions of credit to, Restricted Subsidiaries formed or acquired
after the Closing Date so long as the Borrower and its Subsidiaries comply with
the applicable provisions of Section 9.11, (iii) Permitted Acquisitions after
the Closing Date so long as the Borrower and its Subsidiaries comply with the
applicable provisions of Section 9.11, provided that any investment by the
Borrower or any Restricted Subsidiary in any Restricted Foreign Subsidiary
(other than any investment made from the Net Cash Proceeds of the sale of PCG)
must be (x) in the form of a loan to such Restricted Foreign Subsidiary which is
pledged to the Administrative Agent pursuant to the Collateral Agreement or (y)
made from the proceeds of newly-issued preferred stock of WIH having a
liquidation preference at least equal to 85% of the amount of such investment
which is pledged to the Administrative Agent pursuant to the Collateral
Agreement, and (iv) the other loans, advances and investments described on
Schedule 11.3 existing on the Closing Date;

         (b)      investments in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States or any agency thereof maturing
within one hundred twenty (120) days from the date of acquisition thereof, (ii)
commercial paper maturing no more than one hundred twenty (120) days from the
date of creation thereof and currently having an A-1 or higher rating from S&P
or a P-1 rating from Moody's, (iii) certificates of deposit maturing no more
than one hundred twenty (120) days from the date of creation thereof issued by
commercial banks incorporated under the laws of the United States, each having
combined capital, surplus and undivided profits of not less than $500,000,000
and having a rating of "A" or better by a nationally recognized rating agency;
provided, that the aggregate amount invested in such certificates of deposit
shall not at any time exceed $5,000,000 for any one such certificate of deposit
and $10,000,000 for any one such bank, (iv) money market accounts rated AAA or
A-1 or higher from S&P or P-1 or Aaa from Moody's, (v) time deposits maturing no
more than thirty (30) days from the date of creation thereof with commercial
banks or savings banks or savings and loan associations each having membership
either in the FDIC or the deposits of which are insured by the FDIC and in
amounts not exceeding the maximum amounts of insurance thereunder, or (vi)
municipal securities rated investment grade or better by either S&P or Moody's;

         (c)      Hedging Agreements permitted pursuant to Section 11.1;

         (d)      purchases of assets in the ordinary course of business;

         (e)      to the extent they constitute an investment, contributions to
and payments of benefits under any Employee Benefits Plan in existence as of the
Closing Date as required by the benefit commitment in such Employee Benefits
Plan as of the Closing Date;

         (f)      investments, loans, advances or extensions of credit in
addition to those permitted elsewhere in this Section 11.3 in an aggregate
amount not to exceed $2,000,000 in the aggregate at any time outstanding; and

         (g)      investments in or loans, advances or extensions of credit to
Unrestricted Subsidiaries and/or joint ventures in an amount not to exceed
$10,000,000 during the term of this Agreement.

                                       60



         SECTION 11.4 Limitations on Mergers and Liquidation. Merge, consolidate
or enter into any similar combination with any other Person or liquidate,
wind-up or dissolve itself (or suffer any liquidation or dissolution) except:

         (a)      any Subsidiary of the Borrower may merge with the Borrower or
any Restricted Subsidiary; provided that in any merger involving the Borrower or
a Restricted Subsidiary, the Borrower or such Restricted Subsidiary shall be the
surviving entity;

         (b)      any Restricted Subsidiary of the Borrower may merge into the
Person such Restricted Subsidiary was formed to acquire in connection with an
acquisition permitted by Section 11.3(a); provided that the Restricted
Subsidiary shall be the continuing or surviving Person or the survivor shall
comply with the requirements of Section 9.11; and

         (c)      any Restricted Subsidiary may wind-up into the Borrower or any
other Restricted Subsidiary.

         SECTION 11.5 Limitations on Sale of Assets. Convey, sell, lease,
assign, transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, the sale of any receivables and leasehold
interests and any sale-leaseback or similar transaction), whether now owned or
hereafter acquired except:

         (a)      the sale of inventory in the ordinary course of business;

         (b)      the sale of obsolete assets no longer used or usable in the
business of the Borrower or any of its Subsidiaries;

         (c)      the transfer of assets to the Borrower or any Restricted
Subsidiary pursuant to Section 11.4(c);

         (d)      the sale or discount without recourse of accounts receivable
arising in the ordinary course of business in connection with the compromise or
collection thereof;

         (e)      the disposition of any Hedging Agreement;

         (f)      the sale or other disposition of assets by the Borrower or any
Restricted Subsidiary not otherwise permitted under this Section 11.5; provided
that (i) as of the time of such sale or other disposition, no Default or Event
of Default shall be continuing or would result therefrom, (ii) the aggregate
book value of all assets sold or disposed of pursuant to this clause (f) in any
Fiscal Year shall not exceed $5,000,000, and (iii) the Borrower shall have
complied with the requirements of Section 4.4(b);

         (g)      the sale of any investments permitted under Section 11.3(b)
hereof; and

         (h)      the sale of those assets listed on Schedule 4.4(b)(iii).

         SECTION 11.6 Restricted Payments. Declare, pay or make any Restricted
Payment except:

         (a)      each Restricted Subsidiary may make Restricted Payments to the
Borrower and to Restricted Subsidiaries; and

         (b)      the Borrower shall be allowed to make the Share Purchase.

                                       61



         SECTION 11.7 Limitations on Exchange and Issuance of Capital Stock.
Issue, sell or otherwise dispose of any class or series of capital stock that,
by its terms or by the terms of any security into which it is convertible or
exchangeable, is, or upon the happening of an event or passage of time would be,
(a) convertible or exchangeable into Debt or (b) required to be redeemed or
repurchased, including at the option of the holder, in whole or in part, or has,
or upon the happening of an event or passage of time would have, a redemption or
similar payment due.

         SECTION 11.8 Transactions with Affiliates. Except for transactions
permitted by 11.1, 11.3, 11.6 and 11.7, directly or indirectly (a) make any loan
or advance to, or purchase or assume any note or other obligation to or from,
any of its officers, directors, shareholders or other Affiliates, or to or from
any member of the immediate family of any of its officers, directors,
shareholders or other Affiliates, or subcontract any operations to any of its
Affiliates or (b) enter into, or be a party to, any other transaction not
described in clause (a) above with any of its Affiliates, except pursuant to the
reasonable requirements of its business and upon fair and reasonable terms that
are no less favorable to it than it would obtain in a comparable arm's length
transaction with a Person not its Affiliate.

         SECTION 11.9 Certain Accounting Changes; Organizational Documents. (a)
Change its Fiscal Year end, or make any change in its accounting treatment and
reporting practices except as required by GAAP or (b) amend, modify or change
its articles of incorporation (or corporate charter or other similar
organizational documents) or amend, modify or change its bylaws (or other
similar documents) in any manner adverse in any respect to the rights or
interests of the Lenders.

         SECTION 11.10 Amendments; Payments and Prepayments of Certain Debt.
Amend or modify (or permit the modification or amendment of) any of the terms or
provisions of any Subordinated Debt, or cancel or forgive, make any voluntary or
optional payment or prepayment on, or redeem or acquire for value (including,
without limitation, by way of depositing with any trustee with respect thereto
money or securities before due for the purpose of paying when due) any
Subordinated Debt or Senior Unsecured Debt.

         SECTION 11.11 Restrictive Agreements.

         (a)      Enter into any Debt which contains any negative pledge on
assets or any covenants more restrictive than the provisions of Articles IX, X
and XI hereof, or which restricts, limits or otherwise encumbers its ability to
incur Liens (except for restrictions on Liens pursuant to the High-Yield Note
Indenture) on or with respect to any of its assets or properties other than the
assets or properties securing such Debt.

         (b)      Enter into or permit to exist any agreement which impairs or
limits the ability of any Restricted Subsidiary of the Borrower to pay dividends
to the Borrower.

         SECTION 11.12 Nature of Business. Alter the character or conduct of the
business conducted by the Borrower and its Restricted Subsidiaries as of the
Closing Date.

         SECTION 11.13 Impairment of Security Interests. (a) Take or omit to
take any action, which might or would have the result of materially impairing
the security interests in favor of the Administrative Agent with respect to the
Collateral or grant to any Person (other than the Administrative Agent for the
benefit of itself and the Lenders pursuant to the Security Documents) any
interest whatsoever in the Collateral, except for Liens permitted under Section
11.2 and asset sales permitted under Section 11.5, or (b) permit any Person
other than the Borrower to own any capital stock of WIH.

                                       62



                                  ARTICLE XII

                              DEFAULT AND REMEDIES

         SECTION 12.1 Events of Default. Each of the following shall constitute
an Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
Governmental Authority or otherwise:

         (a)      Default in Payment of Principal of Loans and Reimbursement
Obligations. The Borrower shall default in any payment of principal of any Loan,
Note or Reimbursement Obligation when and as due (whether at maturity, by reason
of acceleration or otherwise).

         (b)      Other Payment Default. The Borrower shall default in the
payment when and as due (whether at maturity, by reason of acceleration or
otherwise) of interest on any Loan, Note or Reimbursement Obligation or the
payment of any other Obligation, and such default shall continue for a period of
three (3) Business Days.

         (c)      Misrepresentation. Any representation, warranty, certification
or statement of fact made or deemed made by or on behalf of the Borrower or any
Restricted Subsidiary under this Agreement, any other Loan Document, or in any
document delivered in connection herewith or therewith that is subject to
materiality or Material Adverse Effect qualifications, shall be incorrect or
misleading in any respect when made or deemed made or any representation,
warranty, certification or statement of fact made or deemed made by or on behalf
of the Borrower or any Restricted Subsidiary herein, any other Loan Document, or
in any document delivered in connection herewith or therewith that is not
subject to materiality or Material Adverse Effect qualifications, shall be
incorrect or misleading in any material respect when made or deemed made.

         (d)      Default in Performance of Certain Covenants. The Borrower
shall default in the performance or observance of any covenant or agreement
contained in Sections 8.1, 8.2, 8.5(e)(i), 9.10, 9.11 or 9.13 or Articles X or
XI of this Agreement.

         (e)      Default in Performance of Other Covenants and Conditions. The
Borrower or any Subsidiary thereof shall default in the performance or
observance of any term, covenant, condition or agreement contained in this
Agreement (other than as specifically provided for otherwise in this Section
12.1) or any other Loan Document and such default shall continue for a period of
thirty (30) days after written notice thereof has been given to the Borrower by
the Administrative Agent.

         (f)      Hedging Agreement. The Borrower shall default in the
performance or observance of any terms, covenant, condition or agreement (after
giving effect to any applicable grace or cure period) under any Hedging
Agreement and such default causes the termination of such Hedging Agreement or
permits any counterparty to such Hedging Agreement to terminate any such Hedging
Agreement.

         (g)      Debt Cross-Default. The Borrower or any of its Subsidiaries
shall (i) default in the payment of any Debt (other than the Notes or any
Reimbursement Obligation) the aggregate outstanding amount of which Debt is in
excess of $2,000,000 beyond the period of grace if any, provided in the
instrument or agreement under which such Debt was created, or (ii) default in
the observance or performance of any other agreement or condition relating to
any Debt (other than the Notes or any Reimbursement Obligation) the aggregate
outstanding amount of which Debt is in excess of $2,000,000 or contained in any
instrument or agreement evidencing, securing or relating thereto or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to

                                       63



permit the holder or holders of such Debt (or a trustee or agent on behalf of
such holder or holders) to cause, with the giving of notice if required, any
such Debt to become due prior to its stated maturity (any applicable grace
period having expired).

         (h)      Change in Control. Any person or group of persons (within the
meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended)
shall obtain ownership or control in one or more series of transactions of more
than thirty percent (30%) of the common stock or thirty percent (30%) of the
voting power of the Borrower entitled to vote in the election of members of the
board of directors of the Borrower or there shall have occurred under any
indenture or other instrument evidencing any Debt in excess of $2,000,000 any
"change in control" (as defined in such indenture or other evidence of Debt)
obligating the Borrower to repurchase, redeem or repay all or any part of the
Debt or capital stock provided for therein (any such event, a "Change in
Control").

         (i)      Voluntary Bankruptcy Proceeding. The Borrower or any
Subsidiary thereof shall (i) commence a voluntary case under the federal
bankruptcy laws (as now or hereafter in effect), (ii) file a petition seeking to
take advantage of any other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or composition for adjustment of debts,
(iii) consent to or fail to contest in a timely and appropriate manner any
petition filed against it in an involuntary case under such bankruptcy laws or
other laws, (iv) apply for or consent to, or fail to contest in a timely and
appropriate manner, the appointment of, or the taking of possession by, a
receiver, custodian, trustee, or liquidator of itself or of a substantial part
of its property, domestic or foreign, (v) admit in writing its inability to pay
its debts as they become due, (vi) make a general assignment for the benefit of
creditors, or (vii) take any corporate action for the purpose of authorizing any
of the foregoing.

         (j)      Involuntary Bankruptcy Proceeding. A case or other proceeding
shall be commenced against the Borrower or any Subsidiary thereof in any court
of competent jurisdiction seeking (i) relief under the federal bankruptcy laws
(as now or hereafter in effect) or under any other laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding up or adjustment of
debts, or (ii) the appointment of a trustee, receiver, custodian, liquidator or
the like for the Borrower or any Subsidiary thereof or for all or any
substantial part of their respective assets, domestic or foreign, and such case
or proceeding shall continue without dismissal or stay for a period of sixty
(60) consecutive days, or an order granting the relief requested in such case or
proceeding (including, but not limited to, an order for relief under such
federal bankruptcy laws) shall be entered.

         (k)      Failure of Agreements. Any provision of this Agreement or any
provision of any other Loan Document shall for any reason cease to be valid and
binding on the Borrower or Subsidiary party thereto or any such Person shall so
state in writing, or any Loan Document shall for any reason cease to create a
valid and perfected first priority Lien on, or security interest in, any of the
collateral purported to be covered thereby, in each case other than in
accordance with the express terms hereof or thereof.

         (l)      Termination Event. The occurrence of any of the following
events: (i) the Borrower or any ERISA Affiliate fails to make full payment when
due of all amounts which, under the provisions of any Pension Plan or Section
412 of the Code, the Borrower or any ERISA Affiliate is required to pay as
contributions thereto, (ii) an accumulated funding deficiency in excess of
$1,000,000 occurs or exists, whether or not waived, with respect to any Pension
Plan, (iii) a Termination Event or (iv) the Borrower or any ERISA Affiliate as
employers under one or more Multiemployer Plans makes a complete or partial
withdrawal from any such Multiemployer Plan and the plan sponsor of such
Multiemployer Plans notifies such withdrawing employer that such employer has
incurred a withdrawal liability requiring payments in an amount exceeding
$1,000,000.

                                       64



         (m)      Judgment. A judgment or order for the payment of money which
causes the aggregate amount of all such judgments to exceed $2,000,000 in any
Fiscal Year shall be entered against the Borrower or any of its Subsidiaries by
any court and such judgment or order shall continue without discharge or stay or
shall not be bonded for a period of thirty (30) days.

         (n)      Environmental. Any one or more Environmental Claims shall have
been asserted against the Borrower or any of its Subsidiaries; the Borrower and
its Subsidiaries would be reasonably likely to incur liability as a result
thereof; and such liability could be reasonably expected, individually or in the
aggregate, to have a Material Adverse Effect.

         SECTION 12.2 Remedies. Upon the occurrence of an Event of Default, with
the consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Borrower:

         (a)      Acceleration; Termination of Facilities. Declare the principal
of and interest on the Loans, the Notes and the Reimbursement Obligations at the
time outstanding, and all other amounts owed to the Lenders and to the
Administrative Agent under this Agreement or any of the other Loan Documents
(including, without limitation, all L/C Obligations, whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented or
shall be entitled to present the documents required thereunder) and all other
Obligations (other than Hedging Obligations), to be forthwith due and payable,
whereupon the same shall immediately become due and payable without presentment,
demand, protest or other notice of any kind, all of which are expressly waived,
anything in this Agreement or the other Loan Documents to the contrary
notwithstanding, and terminate the Credit Facility and any right of the Borrower
to request borrowings or Letters of Credit thereunder; provided, that upon the
occurrence of an Event of Default specified in Section 12.1(i) or (j), the
Credit Facility shall be automatically terminated and all Obligations (other
than Hedging Obligations) shall automatically become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in this Agreement or in any other Loan Document to
the contrary notwithstanding.

         (b)      Letters of Credit. With respect to all Letters of Credit with
respect to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to the preceding paragraph, the Borrower shall at such
time deposit in a cash collateral account opened by the Administrative Agent an
amount equal to the aggregate then undrawn and unexpired amount of such Letters
of Credit (which such cash collateral shall be deposited in the applicable
Permitted Currency in which each Letter of Credit is denominated). Amounts held
in such cash collateral account shall be applied by the Administrative Agent to
the payment of drafts drawn under such Letters of Credit, and the unused portion
thereof after all such Letters of Credit shall have expired or been fully drawn
upon, if any, shall be applied to repay the other Obligations on a pro rata
basis. After all such Letters of Credit shall have expired or been fully drawn
upon, the Reimbursement Obligation shall have been satisfied and all other
Obligations shall have been paid in full, the balance, if any, in such cash
collateral account shall be returned to the Borrower.

         (c)      Rights of Collection. Exercise on behalf of the Lenders all of
its other rights and remedies under this Agreement, the other Loan Documents and
Applicable Law, in order to satisfy all of the Borrower's Obligations.

         SECTION 12.3 Rights and Remedies Cumulative; Non-Waiver; etc. The
enumeration of the rights and remedies of the Administrative Agent and the
Lenders set forth in this Agreement is not intended to be exhaustive and the
exercise by the Administrative Agent and the Lenders of any right or remedy
shall not preclude the exercise of any other rights or remedies, all of which
shall be cumulative, and shall be in addition to any other right or remedy given
hereunder or under the other Loan Documents or that may now or hereafter exist
at law or in equity or by suit or otherwise. No delay or failure to take

                                       65



action on the part of the Administrative Agent or any Lender in exercising any
right, power or privilege shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege or shall be construed to be a waiver of any Event of Default. No
course of dealing between the Borrower, the Administrative Agent and the Lenders
or their respective agents or employees shall be effective to change, modify or
discharge any provision of this Agreement or any of the other Loan Documents or
to constitute a waiver of any Event of Default.

         SECTION 12.4 Judgment Currency. The obligation of the Borrower to make
payments of any amounts payable hereunder or pursuant to any other Loan Document
in the currency specified for such payment shall not be discharged or satisfied
by any tender, or any recovery pursuant to any judgment, which is expressed in
or converted into any other currency, except to the extent that such tender or
recovery shall result in the actual receipt by each of the Administrative Agent
and Lenders of the full amount of the particular Permitted Currency expressed to
be payable pursuant to the applicable Loan Document. The Administrative Agent
shall, using all amounts obtained or received from the Borrower pursuant to any
such tender or recovery in payment of principal of and interest on the
Obligations, promptly purchase the applicable currency at the most favorable
spot exchange rate determined by the Administrative Agent to be available to it.
The obligation of the Borrower to make payments in the applicable currency shall
be enforceable as an alternative or additional cause of action solely for the
purpose of recovering in the applicable currency the amount, if any, by which
such actual receipt shall fall short of the full amount of the currency
expressed to be payable pursuant to the applicable Loan Document.

                                  ARTICLE XIII

                                   THE AGENTS

         SECTION 13.1 Appointment. Each of the Lenders hereby irrevocably
designates and appoints BNP Paribas as Administrative Agent of such Lender under
this Agreement and the other Loan Documents for the term hereof and each such
Lender irrevocably authorizes BNP Paribas, as Administrative Agent for such
Lender, to take such action on its behalf under the provisions of this Agreement
and the other Loan Documents and to exercise such powers and perform such duties
as are expressly delegated to the Administrative Agent by the terms of this
Agreement and such other Loan Documents, together with such other powers as are
reasonably incidental thereto. BNP Paribas is hereby appointed by each of the
Lenders as its contractual representative to serve as the sole and exclusive
Syndication Agent hereunder and under each other Loan Document, and each of the
Lenders irrevocably authorizes the Syndication Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agents agree to act as such
contractual representatives upon the express conditions contained in this
Article XIII. Notwithstanding any provision to the contrary elsewhere in this
Agreement or such other Loan Documents, the Administrative Agent and the
Syndication Agent shall not have any duties or responsibilities, except those
expressly set forth herein and therein, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or the other Loan
Documents or otherwise exist against the Administrative Agent. Any reference to
the Administrative Agent in this Article XIII shall be deemed to refer to the
Administrative Agent solely in its capacity as Administrative Agent and not in
its capacity as a Lender.

         SECTION 13.2 Delegation of Duties. The Agents may execute any of their
respective duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agents shall not be

                                       66



responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by the Agents with reasonable care.

         SECTION 13.3 Exculpatory Provisions. Neither the Agents nor any of
their officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or
Affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or the
other Loan Documents (except for actions occasioned solely by its or such
Person's own gross negligence or willful misconduct), or (b) responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by the Borrower or any of its Subsidiaries or any officer
thereof contained in this Agreement or the other Loan Documents or in any
certificate, report, statement or other document referred to or provided for in,
or received by either Agent under or in connection with, this Agreement or the
other Loan Documents or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the other Loan Documents or
for any failure of the Borrower or any of its Subsidiaries to perform its
obligations hereunder or thereunder. The Agents shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement, or to inspect the properties, books or records of the Borrower or any
of its Subsidiaries.

         SECTION 13.4 Reliance by the Agents. Each Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by such Agent. The
Agents may deem and treat the payee of any Note as the owner thereof for all
purposes unless such Note shall have been transferred in accordance with Section
14.10. The Agents shall be fully justified in failing or refusing to take any
action under this Agreement and the other Loan Documents unless it shall first
receive such advice or concurrence of the Required Lenders (or, when expressly
required hereby or by the relevant other Loan Documents, all the Lenders) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action except for its own gross
negligence or willful misconduct. The Agents shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
Notes in accordance with a request of the Required Lenders (or, when expressly
required hereby, all the Lenders), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Notes.

         SECTION 13.5 Notice of Default. Neither of the Agents shall be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
(except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Administrative Agent for the account of the Lenders)
unless it has received notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". In the event that either of the Agents receives
such a notice, it shall promptly give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders (or,
when expressly required hereby, all the Lenders); provided that unless and until
the Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders, except to the extent that
other provisions of this Agreement expressly require that any such action be
taken or not be taken only with the consent and authorization or the request of
the Lenders or Required Lenders, as applicable.

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         SECTION 13.6 Non-Reliance on the Agents and Other Lenders. Each Lender
expressly acknowledges that neither Agent nor any of its respective officers,
directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates has
made any representations or warranties to it and that no act by an Agent
hereafter taken, including any review of the affairs of the Borrower or any of
its Subsidiaries, shall be deemed to constitute any representation or warranty
by the Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon the Agents or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and its
Subsidiaries and made its own decision to make its Loans and issue or
participate in Letters of Credit hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Agents or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower and its Subsidiaries. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Agents hereunder or by the other Loan Documents, the Agents shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, financial and
other condition or creditworthiness of the Borrower or any of its Subsidiaries
which may come into the possession of the Agents or any of their respective
officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or
Affiliates.

         SECTION 13.7 Indemnification. The Lenders agree to indemnify the Agents
in their capacity as such and (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably according to
the respective amounts of their Revolving Credit Commitment Percentages or Term
Loan Percentages, as applicable, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes
or any Reimbursement Obligation) be imposed on, incurred by or asserted against
either Agent in any way relating to or arising out of this Agreement or the
other Loan Documents, or any documents, reports or other information provided to
the Agents or any Lender or contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by the an Agent under or in connection with any of the foregoing; provided that
no Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting solely from the Agent's bad faith, gross
negligence or willful misconduct. The agreements in this Section 13.7 shall
survive the payment of the Notes, any Reimbursement Obligation and all other
amounts payable hereunder and the termination of this Agreement.

         SECTION 13.8 The Agents in Their Individual Capacities. The Agents and
their respective Subsidiaries and Affiliates may make loans to, accept deposits
from and generally engage in any kind of business with the Borrower as though
the Agents were not the Agents hereunder. With respect to any Loans made or
renewed by it and any Note issued to it and with respect to any Letter of Credit
issued by it or participated in by it, each Agent shall have the same rights and
powers under this Agreement and the other Loan Documents as any Lender and may
exercise the same as though it were not an Agent, and the terms "Lender" and
"Lenders" shall include the Agents in their individual capacities.

         SECTION 13.9 Resignation of the Agents; Successor Agents. Subject to
the appointment and acceptance of a successor as provided below, the Agents may
resign at any time by giving notice thereof to the Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the right to appoint
a successor Administrative Agent or Syndication Agent, as applicable, which
successor shall have

                                       68



minimum capital and surplus of at least $500,000,000. If no successor
Administrative Agent or Syndication Agent, as applicable, shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within thirty (30) days after such Agent's giving of notice of resignation, then
the Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent or Syndication Agent, as applicable, which successor shall
have minimum capital and surplus of at least $500,000,000. Upon the acceptance
of any appointment as Administrative Agent or Syndication Agent, as applicable,
hereunder by a successor Administrative Agent or Syndication Agent, as
applicable, such successor Administrative Agent or Syndication Agent, as
applicable, shall thereupon succeed to and become vested with all rights,
powers, privileges and duties of the retiring Agent, and the retiring Agent
shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as Administrative Agent or Syndication
Agent, as applicable, the provisions of this Section 13.9 shall continue in
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was acting as Administrative Agent or Syndication Agent, as
applicable.

                                  ARTICLE XIV

                                  MISCELLANEOUS

         SECTION 14.1 Notices.

         (a)      Method of Communication. Except as otherwise provided in this
Agreement, all notices and communications hereunder shall be in writing (for
purposes hereof, the term "writing" shall include information in electronic
format such as electronic mail and internet web pages), or by telephone
subsequently confirmed in writing. Any notice shall be effective if delivered by
hand delivery or sent via electronic mail, posting on an internet web page,
telecopy, recognized overnight courier service or certified mail, return receipt
requested, and shall be presumed to be received by a party hereto (i) on the
date of delivery if delivered by hand or sent by electronic mail, posting on an
internet web page (provided the recipients of such notice have been made
specifically aware of the posting of such notice by any other method permitted
by this Section 14.1(a)), or telecopy, (ii) on the next Business Day if sent by
recognized overnight courier service and (iii) on the third Business Day
following the date sent by certified mail, return receipt requested. A
telephonic notice to the Administrative Agent as understood by the
Administrative Agent will be deemed to be the controlling and proper notice in
the event of a discrepancy with or failure to receive a confirming written
notice.

         (b)      Addresses for Notices. Notices to any party shall be sent to
it at the following addresses, or any other address as to which all the other
parties are notified in writing.

         If to the Borrower:        Wackenhut Corrections Corporation
                                    One Park Place
                                    621 NW 53rd Street
                                    Suite 700
                                    Boca Raton, Florida 33487
                                    Attention: John O'Rourke
                                    Telephone No.: 561-999-7401
                                    Telecopy No.: 561-999-7742

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         With copies to:            Akerman Senterfitt
                                    One Southeast Third Avenue
                                    28th Floor
                                    Miami, Florida 33131-1714
                                    Attention: Stephen K. Roddenberry, Esq.
                                    Telephone No.: 305-374-5600
                                    Telecopy No.: 305-374-5095

         And                        Wackenhut Corrections Corporation
                                    One Park Place
                                    621 NW 53rd Street
                                    Suite 700
                                    Boca Raton, Florida 33487
                                    Attention: John Bulfin, General Counsel
                                    Telephone No.: 591-622-5656
                                    Telecopy No.: 561-691-6777

         If to BNP Paribas as       in the case of any Notice of Borrowing,
         Administrative Agent:      Notice of Continuation/Conversion, Notice or
                                    Prepayment or other routine administrative
                                    notice, to:

                                    BNP Paribas
                                    787 Seventh Avenue
                                    New York, New York 10019
                                    Attention: James Broadus
                                    Telephone No.: 212-471-6630
                                    Telecopy No.: 212-471-6603

                                    in all other cases, to:

                                    BNP Paribas
                                    31st Floor
                                    787 Seventh Avenue
                                    New York, New York 10019
                                    Attention: Shayn March
                                    Telephone No.: 212-841-3938
                                    Telecopy No.: 212-841-3830

         With copies to:            BNP Paribas
                                    31st Floor
                                    787 Seventh Avenue
                                    New York, New York 10019
                                    Attention: Duane Helkowski
                                    Telephone No.: 212-841-2940
                                    Telecopy No.: 212-841-3830

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         If to BNP Paribas as       BNP Paribas
         Syndication Agent:         31st Floor
                                    787 Seventh Avenue
                                    New York, New York 10019
                                    Attention: Shayn March
                                    Telephone No.: 212-841-3938
                                    Telecopy No.: 212-841-3830

         With copies to:            BNP Paribas
                                    31st Floor
                                    787 Seventh Avenue
                                    New York, New York 10019
                                    Attention: Duane Helkowski
                                    Telephone No.: 212-841-2940
                                    Telecopy No.: 212-841-3830

         If to any Lender:          To the address referred to on the Register.

         (c)      Administrative Agent's Office. The Administrative Agent hereby
designates its office located at the address set forth above, or any subsequent
office which shall have been specified for such purpose by written notice to the
Borrower and Lenders, as the Administrative Agent's Office referred to herein,
to which payments due are to be made and at which Loans will be disbursed and
Letters of Credit issued.

         SECTION 14.2 Expenses; Indemnity. The Borrower will (a) pay all
reasonable out-of-pocket expenses (including, without limitation, all costs of
electronic or internet distribution of any information hereunder) of the
Administrative Agent in connection with (i) the preparation, execution and
delivery of this Agreement and each other Loan Document, whenever the same shall
be executed and delivered, including, without limitation, all reasonable
out-of-pocket syndication and due diligence expenses and reasonable fees and
disbursements of counsel for the Administrative Agent and (ii) the preparation,
execution and delivery of any waiver, amendment or consent by the Administrative
Agent or the Lenders relating to this Agreement or any other Loan Document,
including, without limitation, reasonable fees and disbursements of counsel for
the Administrative Agent, (b) pay all reasonable out-of-pocket expenses of the
Administrative Agent and each Lender actually incurred in connection with the
administration and enforcement of any rights and remedies of the Administrative
Agent and Lenders under the Credit Facility, including, without limitation, in
connection with any workout, restructuring, bankruptcy or other similar
proceeding, creating and perfecting Liens in favor of Administrative Agent on
behalf of Lenders pursuant to any Security Document, enforcing any Obligations
of, or collecting any payments due from, the Borrower or any Guarantor by reason
of an Event of Default (including in connection with the sale of, collection
from, or other realization upon any of the Collateral or the enforcement of the
Guaranty Agreement; consulting with appraisers, accountants, engineers,
attorneys and other Persons concerning the nature, scope or value of any right
or remedy of the Administrative Agent or any Lender hereunder or under any other
Loan Document or any factual matters in connection therewith, which expenses
shall include without limitation the reasonable fees and disbursements of such
Persons, and (c) defend, indemnify and hold harmless the Administrative Agent
and the Lenders, and their respective parents, Subsidiaries, Affiliates,
employees, agents, trustees, officers and directors, from and against any
losses, penalties, fines, liabilities, settlements, damages, costs and expenses,
suffered by any such Person in connection with any claim (including, without
limitation, any Environmental Claims), investigation, litigation or other
proceeding (whether or not the Administrative Agent or any Lender is a party
thereto) and the prosecution and defense thereof, arising out of or in any way
connected with the Loans, this Agreement, any other Loan Document, or any
documents, reports or other information provided to the

                                       71



Administrative Agent or any Lender or contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby, including, without
limitation, reasonable attorney's and consultant's fees, except to the extent
that any of the foregoing directly result from the gross negligence or willful
misconduct of the party seeking indemnification therefor.

         SECTION 14.3 Set-off.

         (a)      In addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, upon and after
the occurrence of any Event of Default and during the continuance thereof, the
Lenders and any assignee or participant of a Lender in accordance with Section
14.10 are hereby authorized by the Borrower at any time or from time to time,
without notice to the Borrower or to any other Person, any such notice being
hereby expressly waived, to set off and to appropriate and to apply any and all
deposits (general or special, time or demand, including, but not limited to,
indebtedness evidenced by certificates of deposit, whether matured or unmatured)
and any other indebtedness at any time held or owing by the Lenders, or any such
assignee or participant to or for the credit or the account of the Borrower
against and on account of the Obligations irrespective of whether or not (a) the
Lenders shall have made any demand under this Agreement or any of the other Loan
Documents or (b) the Administrative Agent shall have declared any or all of the
Obligations to be due and payable as permitted by Section 12.2 and although such
Obligations shall be contingent or unmatured. Notwithstanding the preceding
sentence, each Lender agrees to notify the Borrower and the Administrative Agent
after any such set-off and application, provided that the failure to give such
notice shall not affect the validity of such set-off and application.

         (b)      Any amount to be set-off pursuant to Section 14.3(a) shall be
denominated in Dollars and any amount denominated in an Alternative Currency
shall be in an amount equal to the Dollar Amount of such amount at the most
favorable spot exchange rate determined by the Administrative Agent to be
available to it; provided that if at the time of any such determination no such
spot exchange rate can reasonably be determined, the Administrative Agent may
use any reasonable method as it deems applicable to determine such rate, any
such determination to be conclusive absent manifest error.

         (c)      Each Lender and any assignee or participant of such Lender in
accordance with Section 14.10 are hereby authorized by the Borrower to combine
currencies, as deemed necessary by such Person, in order to effect any set-off
pursuant to Section 14.3(a).

         SECTION 14.4 Governing Law. This Agreement, the Notes and the other
Loan Documents, unless otherwise expressly set forth therein, shall be governed
by, construed and enforced in accordance with the laws of the State of New York
(including Section 5-1401 and Section 5-1402 of the General Obligations Law of
the State of New York), without regard to the conflicts of law provisions of
such state.

         SECTION 14.5 Jurisdiction and Venue.

         (a)      Jurisdiction. The Borrower hereby irrevocably consents to the
personal jurisdiction of the state and federal courts located in New York, New
York (and any courts from which an appeal from any of such courts must or may be
taken), in any action, claim or other proceeding arising out of any dispute in
connection with this Agreement, the Notes and the other Loan Documents, any
rights or obligations hereunder or thereunder, or the performance of such rights
and obligations. The Borrower hereby irrevocably consents to the service of a
summons and complaint and other process in any action, claim or proceeding
brought by the Administrative Agent or any Lender in connection with this
Agreement, the Notes or the other Loan Documents, any rights or obligations
hereunder or thereunder, or the performance of such rights and obligations, on
behalf of itself or its property, in the manner specified

                                       72



in Section 14.1 (other than by posting on an internet web page). Nothing in this
Section 14.5 shall affect the right of the Administrative Agent or any Lender to
serve legal process in any other manner permitted by Applicable Law or affect
the right of the Administrative Agent or any Lender to bring any action or
proceeding against the Borrower or its properties in the courts of any other
jurisdictions.

         (b)      Venue. The Borrower hereby irrevocably waives any objection it
may have now or in the future to the laying of venue in the aforesaid
jurisdiction in any action, claim or other proceeding arising out of or in
connection with this Agreement, any other Loan Document or the rights and
obligations of the parties hereunder or thereunder. The Borrower irrevocably
waives, in connection with such action, claim or proceeding, any plea or claim
that the action, claim or other proceeding has been brought in an inconvenient
forum.

         SECTION 14.6 Waiver of Jury Trial. THE AGENTS, EACH LENDER AND THE
BORROWER HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH
RESPECT TO ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE,
JUDICIAL PROCEEDING, CLAIM OR CONTROVERSY IN CONNECTION WITH THIS AGREEMENT
("DISPUTES"), THE NOTES OR THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS
HEREUNDER OR THEREUNDER, OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.

         SECTION 14.7 Reversal of Payments. To the extent the Borrower makes a
payment or payments to the Administrative Agent for the ratable benefit of the
Lenders or the Administrative Agent receives any payment or proceeds of the
collateral which payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds repaid, the Obligations or part thereof
intended to be satisfied shall be revived and continued in full force and effect
as if such payment or proceeds had not been received by the Administrative
Agent.

         SECTION 14.8 Injunctive Relief; Punitive Damages.

         (a)      The Borrower recognizes that, in the event the Borrower fails
to perform, observe or discharge any of its obligations or liabilities under
this Agreement, any remedy of law may prove to be inadequate relief to the
Lenders. Therefore, the Borrower agrees that the Lenders, at the Lenders'
option, shall be entitled to temporary and permanent injunctive relief in any
such case without the necessity of proving actual damages.

         (b)      The Administrative Agent, the Lenders and the Borrower (on
behalf of itself and its Subsidiaries) hereby agree that no such Person shall
have a remedy of punitive or exemplary damages against any other party to a Loan
Document and each such Person hereby waives any right or claim to punitive or
exemplary damages that they may now have or may arise in the future in
connection with any Dispute, whether such Dispute is resolved through
arbitration or judicially.

         SECTION 14.9 Accounting Matters. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time, provided that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied

                                       73



immediately before such change shall have become effective until such notice
shall have been withdrawn or such provision amended in accordance therewith.

         SECTION 14.10 Successors and Assigns; Participations

         (a)      Benefit of Agreement. This Agreement shall be binding upon and
inure to the benefit of the Borrower, the Administrative Agent and the Lenders,
all future holders of the Notes, and their respective successors and assigns,
except that the Borrower shall not assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of each
Lender.

         (b)      Assignment by Lenders. Each Lender may, in the ordinary course
of its business and in accordance with Applicable Law, sell or assign to any
Lender, any Affiliate of a Lender or in the case of the Term Loans any Approved
Fund and with the consent of the Borrower (so long as no Default or Event of
Default has occurred and is continuing) and the consent of the Administrative
Agent, which consents shall not be unreasonably withheld or delayed, assign to
one or more other Eligible Assignees (any of the foregoing assignees or
purchasers, a "Purchasing Lender") all or a portion of its interests, rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, all or a portion of the Extensions of Credit at the time
owing to it and the Notes held by it); provided that:

                  (i)      each such assignment shall be of a constant, and not
a varying, percentage of the Revolving Credit Commitment and/or the Term Loan
Commitment, as applicable, of the assigning Lender's rights and obligations
under this Agreement;

                  (ii)     if less than all of the assigning Lender's Revolving
Credit Commitment or Term Loan Commitment, as applicable, is to be assigned, the
Commitment so assigned shall not be less than $2,500,000 with respect to the
Revolving Credit Facility and $1,000,000 (or otherwise agreed by the
Administrative Agent and Borrower) with respect to the Term Loan Facility,
unless such sale or assignment is made to an existing Lender, to an Affiliate
thereof, or (with respect to any Term Loan) to an Approved Fund, in which case
no minimum amount shall apply;

                  (iii)    the Purchasing Lender shall have delivered to the
Administrative Agent all United States Internal Revenue Service Forms required
pursuant to Section 5.11(e) and all of the parties to each such assignment shall
execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance substantially in the
form of Exhibit G attached hereto (an "Assignment and Acceptance"), together
with (to the extent requested by any Purchasing Lender) any Note or Notes
subject to such assignment;

                  (iv)     no assignment of a Revolving Credit Commitment, or
participation in L/C Obligations or Swingline Loans shall be made without the
prior written consent of the Swingline Lender and the Issuing Lender and (so
long as no Default or Event of Default has occurred and is continuing) the
Borrower (which consent shall not be unreasonably withheld);

                  (v)      where consent of the Borrower to an assignment to a
Purchasing Lender is required hereunder (including consent to an assignment to
an Approved Fund), the Borrower shall be deemed to have given its consent five
(5) Business Days after the date written notice thereof has been delivered by
the assigning Lender (through the Administrative Agent) unless such consent is
expressly refused by the Borrower prior to such fifth (5th) Business Day;

                  (vi)     such assignment shall not, without the consent of the
Borrower, require the Borrower to file a registration statement with the
Securities and Exchange Commission or apply to or qualify the Loans or the Notes
under the blue sky laws of any state; and

                                       74



                  (vii)    unless otherwise agreed to by the Administrative
Agent, the assigning Lender shall pay to the Administrative Agent an assignment
fee of $3,500 upon the execution by such Lender of the Assignment and
Acceptance; provided that no such fee shall be payable upon any assignment by a
Lender to an Affiliate thereof; and provided further that, in any case of
contemporaneous assignments by a Lender (including a group of affiliated Lenders
that are funds managed by the same investment advisor) to a single assignee or
more than one fund managed by the same investment advisor (which funds are not
then Lenders hereunder), only a single $3,500 fee shall be payable for all such
contemporaneous assignments.

Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be at least five (5) Business Days after the execution thereof (unless
otherwise agreed to by the Administrative Agent), (A) the Purchasing Lender
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereby
and (B) the Lender thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement.

         (c)      Rights and Duties Upon Assignment. By executing and delivering
an Assignment and Acceptance, the assigning Lender thereunder and the Purchasing
Lender thereunder confirm to and agree with each other and the other parties
hereto as set forth in such Assignment and Acceptance.

         (d)      Register. The Administrative Agent shall maintain a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders and the amount of the
Extensions of Credit with respect to each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent and the Lenders may
treat each person whose name is recorded in the Register as a Lender hereunder
for all purposes of this Agreement. The Register shall be available for
inspection by the Borrower at any reasonable time and from time to time upon
reasonable prior notice.

         (e)      Issuance of New Notes. Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and a Purchasing Lender together with
any Note or Notes (if applicable) subject to such assignment and (if applicable)
the written consent to such assignment, the Administrative Agent shall, if such
Assignment and Acceptance has been completed and is substantially in the form of
Exhibit G:

                  (i)      accept such Assignment and Acceptance;

                  (ii)     record the information contained therein in the
Register;

                  (iii)    give prompt notice thereof to the applicable Lenders
and the Borrower; and

                  (iv)     promptly deliver a copy of such Assignment and
Acceptance to the Borrower.

Within five (5) Business Days after receipt of notice, the Borrower shall
execute and deliver to the Administrative Agent, in exchange for the surrendered
Note or Notes, a new Note or Notes to the order of such Purchasing Lender (to
the extent requested thereby) in amounts equal to the Revolving Credit
Commitment and/or Term Loan Commitment assumed by it pursuant to such Assignment
and Acceptance and a new Note or Notes to the order of the assigning Lender (to
the extent requested thereby) in an amount equal to the Revolving Credit
Commitment and/or Term Loan Commitment retained by it hereunder. Such new Note
or Notes shall be in an aggregate principal amount equal to the aggregate
principal amount of such surrendered Note or Notes, shall be dated the effective
date of such Assignment and Acceptance and shall otherwise be in substantially
the form of the assigned Notes delivered to the

                                       75



assigning Lender. Each surrendered Note or Notes shall be canceled and returned
to the Borrower. Notwithstanding anything in this Agreement to the contrary, any
Lender which has not been issued a Note or Notes hereunder may at any time
deliver a written request for a Note or Notes to the Administrative Agent and
the Borrower. Within five (5) Business Days after receipt of notice, the
Borrower shall execute and deliver to the Administrative Agent, a Note or Notes
(as applicable) to the order of such Lender in amounts equal to the Revolving
Credit Commitment and/or Term Loan Commitment of such Lender. Upon receipt
thereby, the Administrative Agent shall promptly deliver such Note or Notes to
such Lender.

         (f)      Participations. Each Lender may, without notice to or the
consent of the Borrower or the Administrative Agent, in the ordinary course of
its commercial banking business and in accordance with Applicable Law, sell
participations to one or more banks or other entities (any such bank or other
entity, a "Participant") in all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its
Extensions of Credit and the Notes held by it); provided that:

                  (i)      each such participation shall be in an amount not
less than $2,500,000 with respect to the Revolving Credit Facility and
$1,000,000 with respect to the Term Loan Facility;

                  (ii)     such Lender's obligations under this Agreement
(including, without limitation, its Revolving Credit Commitment and/or Term Loan
Commitment, as applicable) shall remain unchanged; (iii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations;

                  (iv)     such Lender shall remain the holder of the Notes held
by it for all purposes of this Agreement;

                  (v)      the Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement;

                  (vi)     such Lender shall not permit such Participant the
right to approve any waivers, amendments or other modifications to this
Agreement or any other Loan Document other than waivers, amendments or
modifications which would reduce the principal of or the interest rate on any
Loan or Reimbursement Obligation, extend the term or increase the amount of the
Revolving Credit Commitment and/or Term Loan Commitment of such Lender, reduce
the amount of any fees to which such Participant is entitled, extend any
scheduled payment date for principal of any Loan or, except as expressly
contemplated hereby or thereby, release substantially all of the Collateral; and

                  (vii)    any such disposition shall not, without the consent
of the Borrower, require the Borrower to file a registration statement with the
Securities and Exchange Commission to apply to qualify the Loans or the Notes
under the blue sky law of any state.

         The Borrower agrees that each Participant shall be entitled to the
benefits of Section 5.7, Section 5.8, Section 5.9, Section 5.10, Section 5.11
and Section 14.3 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section 14.10; provided
that a Participant shall not be entitled to receive any greater payment under
Section 5.7, Section 5.8, Section 5.9, Section 5.10, and Section 5.11 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower's prior written consent and such
Participant

                                       76



shall have delivered to the Administrative Agent all United States Internal
Revenue Service Forms required pursuant to Section 5.11(e).

         (g)      Disclosure of Information; Confidentiality. The Administrative
Agent and the Lenders shall hold all non-public information with respect to the
Borrower obtained pursuant to the Loan Documents (or any Hedging Agreement with
a Lender or the Administrative Agent) in accordance with their customary
procedures for handling confidential information; provided, that the
Administrative Agent may disclose information relating to this Agreement to Gold
Sheets and other similar bank trade publications, such information to consist of
deal terms and other information customarily found in such publications and
provided further, that the Administrative Agent or any Lender may disclose any
such information to the extent such disclosure is (i) required by law or
requested or required pursuant to any legal process, (ii) requested by, or
required to be disclosed to, any rating agency, or regulatory or similar
authority (including, without limitation, the National Association of Insurance
Commissioners) or (iii) used in any suit, action or proceeding for the purpose
of defending itself, reducing its liability or protecting any of its claims,
rights, remedies or interests under or in connection with the Loan Documents (or
any Hedging Agreement with a Lender or the Administrative Agent). Any Lender
may, in connection with any assignment, proposed assignment, participation or
proposed participation pursuant to this Section 14.10, disclose to the
Purchasing Lender, proposed Purchasing Lender, Participant, proposed
Participant, or to any direct or indirect contractual counterparty in swap
agreements or such contractual counterparty's professional advisor any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; provided, that prior to any such disclosure, each such Purchasing
Lender, proposed Purchasing Lender, Participant or proposed Participant,
contractual counterparty or professional advisor shall agree to be bound by the
provisions of this Section 14.10(g). Notwithstanding any other provision in this
Agreement, each of the parties hereto (and each employee, representative or
other agent of any such party) may disclose to any and all Persons, without
limitation of any kind, the U.S. tax treatment and U.S. tax structure of the
transaction contemplated hereby and all materials of any kind (including
opinions of other tax analyses) that are provided to such party relating to such
U.S. tax treatment and U.S. tax structure, other than any information for which
nondisclosure is reasonably necessary in order to comply with applicable
securities laws.

         (h)      Certain Pledges or Assignments. Any Lender may, without the
consent of the Borrower or the Administrative Agent, at any time pledge or
assign a security interest in all or any portion of its rights under this
Agreement or any other Loan Document to secure obligations of such Lender,
including without limitation any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment of a security
interest shall release a Lender form any of its obligations hereunder or
substitute such pledgee or assignee for such Lender as a party hereto. In the
case of any Lender that is a fund that invests in bank loans, such Lender may,
without the consent of the Borrower or Administrative Agent, assign or pledge
all or any portion of its rights under this Agreement, including the Loans and
Notes or any other instrument evidencing its rights as a Lender under this
Agreement, to any holder or, trustee for, or any other representative of holders
of, obligations owed or securities issued, by such fund, as security for such
obligations or securities; provided that any foreclosure or similar action by
such trustee or representative shall be subject to the provisions of this
Section 14.10(b) concerning assignments.

         SECTION 14.11 Amendments, Waivers and Consents. Except as set forth
below or as specifically provided in Section 14.23 or in any Loan Document, any
term, covenant, agreement or condition of this Agreement or any of the other
Loan Documents may be amended or waived by the Lenders, and any consent given by
the Lenders, if, but only if, such amendment, waiver or consent is in writing
signed by the Required Lenders (or by the Administrative Agent with the consent
of the Required Lenders) and delivered to the Administrative Agent and, in the
case of an amendment, signed by the Borrower; provided, that no amendment,
waiver or consent shall (a) increase the Revolving Credit

                                       77



Commitment or Term Loan Commitment of any Lender or increase the amount of the
Loans of any Lender without the prior written consent of such Lender, (b) reduce
the fee or the rate of interest payable on any Loan or Reimbursement Obligation
without the prior written consent of each Lender affected thereby, (c) reduce or
forgive the principal amount of any Loan or Reimbursement Obligation without the
prior written consent of each Lender affected thereby, (d) extend the scheduled
time or times of payment of the principal of any Loan or Reimbursement
Obligation (including, without limitation, the date of any principal
amortization payment set forth in Section 4.3 or the final maturity date) or the
time or times of payment of interest on any Loan or Reimbursement Obligation or
any fee or commission with respect thereto or the duration of any Interest
Period beyond six (6) months without the prior written consent of each Lender
affected thereby, (e) permit any subordination of the principal or interest on
any Loan or Reimbursement Obligation without the prior written consent of each
Lender, (f) release the Borrower from the Obligations (other than Hedging
Obligations) hereunder without the prior written consent of each Lender, (g)
permit any assignment (other than as specifically permitted or contemplated in
this Agreement) of any of the Borrower's rights and obligations hereunder
without the prior written consent of each Lender, (h) release any material
portion of the Collateral or release any Security Document (other than asset
sales permitted pursuant to Section 11.5 and as otherwise specifically permitted
or contemplated in this Agreement or the applicable Security Document) without
the prior written consent of each Lender, (i) release any Guarantor from its
obligations under the Guaranty Agreement without the prior written consent of
each Lender, (j) amend the provisions of this Section 14.11 or the definition of
Required Lenders without the prior written consent of each Lender or (k) extend
the time of the obligation of the Lenders holding Revolving Credit Commitments
to make or issue or participate in Letters of Credit, in each case, without the
prior written consent of each Lender holding Revolving Credit Loans or a
Revolving Credit Commitment.

In addition, no amendment, waiver or consent to the provisions of Section
4.4(b)(vi) with respect to the order of application of amounts prepaid, Section
5.4 with respect to the pro rata treatment of payments, or Section 5.5 with
respect to the order of application of proceeds shall be made without the
written consent of each Lender adversely affected thereby.

In addition, no amendment, waiver or consent to the provisions of (a) Article
XIII shall be made without the written consent of the Administrative Agent and
(b) Article III without the written consent of the Issuing Lender.

Notwithstanding anything to the contrary contained in this Agreement, if any
Lender does not consent to any amendment, waiver or consent requested by the
Borrower, and such amendment, waiver or consent is approved by the Required
Lenders, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent given not more than forty-five (45)
days after such approval, require such Lender to assign and delegate, without
recourse and in accordance with the provisions of Section 14.10(b), all of its
interests, rights and obligations under this Agreement and the other Loan
Documents to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment), provided that such
Lender shall have received payment of an amount equal to the outstanding
principal amount of its Loans, accrued interest thereon, accrued fees and all
other amounts owing to it hereunder from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or from the Borrower (in
the case of all other amounts).

         SECTION 14.12 Performance of Duties. The Borrower's obligations under
this Agreement and each of the other Loan Documents shall be performed by the
Borrower at its sole cost and expense.

         SECTION 14.13 All Powers Coupled with Interest. All powers of attorney
and other authorizations granted to the Lenders, the Administrative Agent and
any Persons designated by the

                                       78



Administrative Agent or any Lender pursuant to any provisions of this Agreement
or any of the other Loan Documents shall be deemed coupled with an interest and
shall be irrevocable so long as any of the Obligations remain unpaid or
unsatisfied, any of the Commitments remain in effect or the Credit Facility has
not been terminated.

         SECTION 14.14 Survival of Indemnities. Notwithstanding any termination
of this Agreement, the indemnities to which the Administrative Agent and the
Lenders are entitled under the provisions of this Article XIV and any other
provision of this Agreement and the other Loan Documents shall continue in full
force and effect and shall protect the Administrative Agent and the Lenders
against events arising after such termination as well as before.

         SECTION 14.15 Titles and Captions. Titles and captions of Articles,
Sections and subsections in, and the table of contents of, this Agreement are
for convenience only, and neither limit nor amplify the provisions of this
Agreement.

         SECTION 14.16 Severability of Provisions. Any provision of this
Agreement or any other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remainder of
such provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.

         SECTION 14.17 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns, and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page of this Agreement by telecopy or other
electronic means shall be as effective as delivery of a manually executed
counterpart of this Agreement.

         SECTION 14.18 Term of Agreement. This Agreement shall remain in effect
from the Closing Date through and including the date upon which all Obligations
arising hereunder or under any other Loan Document shall have been indefeasibly
and irrevocably paid and satisfied in full and all Commitments have been
terminated. The Administrative Agent is hereby permitted to release all Liens on
the Collateral in favor of the Administrative Agent, for the ratable benefit of
itself and the Lenders, upon repayment of the outstanding principal of and all
accrued interest on the Loans, payment of all outstanding fees and expenses
hereunder and the termination of the Lender's Commitments. No termination of
this Agreement shall affect the rights and obligations of the parties hereto
arising prior to such termination or in respect of any provision of this
Agreement which survives such termination.

         SECTION 14.19 Advice of Counsel. Each of the parties represents to each
other party hereto that it has discussed this Agreement with its counsel.

         SECTION 14.20 No Strict Construction. The parties hereto have
participated jointly in the negotiation and drafting of this Agreement. In the
event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Agreement.

         SECTION 14.21 Inconsistencies with Other Documents; Independent Effect
of Covenants.

         (a)      In the event there is a conflict or inconsistency between this
Agreement and any other Loan Document, the terms of this Agreement shall
control; provided, that any provision of the Security

                                       79



Documents which imposes additional burdens on the Borrower or its Subsidiaries
or further restricts the rights of the Borrower or its Subsidiaries or gives the
Administrative Agent or Lenders additional rights shall not be deemed to be in
conflict or inconsistent with this Agreement and shall be given full force and
effect.

         (b)      The Borrower expressly acknowledges and agrees that each
covenant contained in Articles IX, X, or XI hereof shall be given independent
effect. Accordingly, the Borrower shall not engage in any transaction or other
act otherwise permitted under any covenant contained in Articles IX, X, or XI
if, before or after giving effect to such transaction or act, the Borrower shall
or would be in breach of any other covenant contained in Articles IX, X, or XI.

         SECTION 14.22 Continuity of Contract. The parties hereto agree that the
occurrence or non-occurrence of EMU, any event or events associated with EMU
and/or the introduction of the euro in all or any part of the European Union (a)
will not result in the discharge, cancellation, rescission or termination in
whole or in part of this Agreement or any other Loan Document, (b) will not give
any party the right to cancel, rescind, terminate or vary this Agreement or any
other Loan Document or (c) will not give rise to an Event of Default, in each
case other than as specifically provided in this Agreement.

         SECTION 14.23 Increase of Revolving Credit Commitments. Notwithstanding
anything to the contrary contained in this Agreement, the Administrative Agent,
the Borrower and one or more financial institutions (including any existing
Lender) may from time to time enter into an amendment to this Agreement solely
for the purpose of adding such financial institution as a Lender with a
Revolving Credit Commitment under this Agreement (or, if such financial
institution is already a Lender, increasing its Revolving Credit Commitment);
provided that (i) after giving effect to such amendment, the aggregate Revolving
Credit Commitments of all of the Lenders (including any new Lender) will not
exceed $100,000,000, (ii) on the effective date of such amendment the
outstanding Revolving Credit Loans will be deemed to be reallocated among the
Lenders (including any new Lender) so that such Revolving Credit Loans are pro
rata to the Revolving Credit Commitments of all of the Lenders after giving
effect to such amendment, and the new Lender (or the existing Lender whose
Commitment is being increased) will pay to the Administrative Agent for the
account of the other Lenders such amount as is necessary to accomplish such
result and (iii) the Borrower shall simultaneously pay to each existing Lender
any funding losses to be incurred by such lender in connection with the payment
to be received by such Lender pursuant to clause (ii) above. Any such amendment
shall be in form and substance satisfactory to the Administrative Agent who
shall promptly provide a copy thereof to each Lender.

         SECTION 14.24 Transition Provisions. Notwithstanding anything to the
contrary in the Existing Facility or this Agreement, this Agreement shall
constitute an amendment and restatement, and not a novation, of the Existing
Facility and:

         (a)      all letters of credit issued by the Issuing Lender pursuant to
the Existing Facility and outstanding on the Closing Date shall be deemed to
have been issued pursuant to this Agreement and shall be considered Letters of
Credit for purposes hereof;

         (b)      all swingline loans made pursuant to the Existing Facility and
outstanding on the Closing Date shall be paid in full by the Borrower on the
Closing Date;

         (c)      (i) all revolving credit loans and term loans made under the
Existing Facility and outstanding on the Closing Date (after giving effect to
the $25,000,000 repayment of term loans made on the Closing Date) shall be
deemed to have been made pursuant to this Agreement and shall be considered
Revolving Credit Loans and Term Loans, respectively, for all purposes hereof,
(ii) effective as of the Closing Date, such Revolving Credit Loans and Term
Loans shall be reallocated among the Lenders to

                                       80



the extent necessary so that, after giving effect thereto, the outstanding
Revolving Credit Loans and Term Loans shall be allocated among the Lenders pro
rata according to their respective Revolving Credit Commitments and Term Loan
Commitments, as the case may be, (iii) on the Closing Date, the Lenders shall,
as directed by the Administrative Agent, make such payments among themselves as
is necessary to accomplish such reallocation and (iv) on the Closing Date, the
Borrower will pay all costs and expenses (including, without limitation,
breakage costs or increased funding costs) necessary to compensate each Lender
for such reallocation;

         (d)      all accrued fees payable under the Existing Facility and
unpaid on the Closing Date shall be deemed to be accrued and unpaid under this
Agreement and shall become due and payable under this Agreement as and when
provided herein, except that any accrued fees payable to any lender under the
Existing Facility who is not continuing as a Lender under this Agreement shall
be paid in full by the Borrower on the Closing Date.

                           [Signature pages to follow]

                                       81



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers, all as of the day and
year first written above.

                           WACKENHUT CORRECTIONS CORPORATION,
                           as Borrower

                           By: /s/ John G. O'Rourke
                               -------------------------------------------------
                               Name:  John G. O'Rourke
                               Title: Chief Financial Officer-
                                      Senior Vice President

                           BNP PARIBAS,
                           as Administrative Agent, Syndication Agent and Lender

                           By: /s/ Duane P. Helkowski
                               -------------------------------------------------
                               Name:  Duane P. Helkowski
                               Title: Managing Director

                           By: /s/ Richard Pace
                               -------------------------------------------------
                               Name:  Richard Pace
                               Title: Director



                           [ADDITIONAL LENDERS], as Lender

                           By:__________________________________________________
                              Name:
                              Title:

EX-99.1

                                                                    EXHIBIT 99.1


Press Release                         Source: Wackenhut Corrections Corporation

WACKENHUT CORRECTIONS CORPORATION ANNOUNCES COMPLETION OF NEW FINANCING
                          Wednesday July 9, 3:33 pm ET



BOCA RATON, Fla., July 9 /PRNewswire-FirstCall/ -- Wackenhut Corrections
Corporation (NYSE: WHC - News; "WCC") announced today that it has completed the
sale of $150 million in aggregate principal amount of ten-year, 81/4% senior
unsecured notes in a private offering to qualified institutional buyers under
Rule 144A of the Securities Act and to persons outside the United States
pursuant to Regulation S and the amendment of its senior secured credit
facility, consisting of a $100 million 6-year term loan ("Term Loan B") and a
$50 million 5-year revolver ("Revolver"). The interest rate for the Term Loan B
and the Revolver is LIBOR plus 3%.

o    (Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20010614/WCCLOGO)

The notes have not been registered under the securities laws of the United
States and may not be offered or sold in the United States except to qualified
institutional buyers. WCC has used the net proceeds from the offering, together
with approximately $100 million of borrowings under its amended senior secured
credit facility and approximately $16 million in cash-on-hand, to repurchase 12
million shares of its common stock from Group 4 Falck A/S, its former 57%
shareholder, and to refinance amounts outstanding under its previous senior
secured credit facility.

This press release does not constitute an offer to sell or a solicitation of an
offer to buy the securities described herein, nor shall there be any sale of
these securities in any state or jurisdiction in which such an offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities law of any such jurisdiction.


- --------------------------
Source: Wackenhut Corrections Corporation

EX-99.2

                                                                    EXHIBIT 99.2

Press Release                         Source: Wackenhut Corrections Corporation

WACKENHUT CORRECTIONS CORPORATION ANNOUNCES REPURCHASE OF GROUP 4 FALCK'S
CONTROLLING INTEREST

Wednesday July 9, 4:09 pm ET

BOCA RATON, Fla., July 9 /PRNewswire-FirstCall/ -- Wackenhut Corrections
Corporation (NYSE: WHC - News; "WCC") announced today that it has completed the
repurchase of all 12 million shares of WCC common stock held by its former
majority shareholder, Group 4 Falck of Denmark. The two Group 4 Falck members of
the WCC Board of Directors have tendered their resignations, reducing the WCC
Board from nine to seven members.

o  (Photo: http://www.newscom.com/cgi-bin/prnh/20010614/WCCLOGO )

George C. Zoley, Chairman of the Board and Chief Executive Officer of WCC,
stated: "This historic transaction transforms WCC from a corporate subsidiary
into a truly independent company with full access to the capital markets and the
ability to grow at its own pace. We have recently moved our corporate offices to
Boca Raton, Florida and will be establishing a new name for the company within
the next year pursuant to the Group 4 Falck share repurchase agreement. We are
confident that the elimination of the uncertainty created by Group 4 Falck's 12
million share overhang will represent a long term benefit for WCC shareholders."

WCC had previously given investor guidance for 2003 earnings per share within
the range of $1.04 to $1.06, which did not assume either the repurchase of 12
million shares from Group 4 Falck or the sale of WCC's 50% interest in the UK
joint venture, Premier Custodial Group Limited ("PCG").

With the repurchase of the 12 million shares, which reduces the number of
outstanding shares to 9.4 million (or 15.3 million weighted average shares for
2003), and with the sale of WCC's 50% interest in PCG, WCC estimates 2003
earnings per share to be within the range of $3.00 to $3.20, inclusive of an
after-tax book gain of approximately $32 million from the sale of PCG. Investor
guidance previously given by WCC for 2004 did not reflect the sale of WCC's
interest in PCG. Since WCC has not yet allocated the proceeds from that sale for
any specific purpose, WCC is not providing any updated investor guidance for
2004 at this time.

Mr. Zoley further stated: "With the approximately $80 million in pre-tax
proceeds, or $52 million in after-tax proceeds, that the company received from
the sale of its 50% interest in the UK joint venture and the company's enhanced
ability to access the capital markets, WCC plans to pursue one or more
acquisitions during the next nine months, rather than pay down borrowings under
its senior credit facility. The company will be considering opportunities in the
US and international markets within its existing business lines of correctional
and mental health care services." WCC also announced today that its Board of
Directors has adopted a shareholder rights plan. The rights plan is intended to
assist the company in pursuing its long-term business strategies and to enhance
stockholder value.

WCC is a world leader in the delivery of correctional and detention management,
health and mental health services to federal, state and local government
agencies around the globe. WCC offers a turnkey approach that includes design,
construction, financing and operations. The Company represents 31 government
clients servicing 48 facilities in the United States, Australia, South Africa,
New Zealand, and Canada with a total design capacity of approximately 36,000
beds.

This press release contains forward-looking statements regarding future events
and future performance of the Company that involve risks and uncertainties that
could materially affect actual results, including statements regarding estimated
earnings, revenues and costs and our ability to maintain growth and strengthen
contract relationships. Factors that could cause actual results to vary from
current expectations and forward-looking statements contained in this press
release include, but are not limited to: (1) WCC's ability to use the net
proceeds from the sale of its UK joint venture interest to acquire a prison or
mental health services business or to otherwise expand its existing operations
in those lines of business; (2) fluctuations in the exchange rate between the UK
pound and the US dollar; (3) WCC's ability to meet its earnings guidance for
2003 given the various risks to which its business is exposed; (4) WCC's ability
to access the capital markets in the future on satisfactory terms or at all; (5)
risks associated with WCC's ability to control operating costs associated with
contract start- ups; (6) WCC's ability to timely open facilities as planned,
profitably manage such facilities and successfully integrate such facilities
into WCC's operations without substantial costs; (7) WCC's ability to win
management contracts for which it has submitted proposals and to retain existing
management contracts; (8) WCC's ability to obtain future financing on acceptable
terms; (9) WCC's ability to sustain company-wide occupancy rates at its
facilities; and (10) other factors contained in WCC's Securities and Exchange
Commission filings, including the forms 10-K, 10-Q and 8-K reports.


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Source: Wackenhut Corrections Corporation