JPMorgan - KASE

“Consolidated Net Income” means, with respect to any Person for any period, the aggregate of
the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated
basis, determined in accordance with GAAP, provided that (i) 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 or by proportional consolidation shall be included only to the extent of the amount
of dividends or distributions paid in cash to the referent Person or a Restricted Subsidiary
thereof, (ii) the Net Income of, or any dividends or other distributions from, any Unrestricted
Subsidiary, to the extent otherwise included, shall be excluded to the extent not distributed to
such Person or one of its Restricted Subsidiaries, (iii) 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 (which 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, (iv) the Net Income of any Person acquired in a pooling of interests transaction
for any period prior to the date of such acquisition shall be excluded, (v) the cumulative effect of
a change in accounting principles shall be excluded, (vi) income or loss attributable to
discontinued operations shall be excluded, (vii) any increase in cost of sales or other write-offs
resulting from the purchase accounting treatment of any acquisitions shall be excluded, (viii) all
Asset Sales and all other extraordinary, unusual or nonrecurring gains and losses shall be
excluded, (ix) any gain or loss, net of taxes, realized on the termination of any employee pension
benefit plan shall be excluded, and (x) with regard to a non-Wholly Owned Restricted Subsidiary,
any aggregate Net Income (or loss) in excess of such Person’s or such Subsidiary’s pro rata share
of such non-Wholly Owned Restricted Subsidiary’s Net Income (or loss) shall be excluded.
“Consolidated Net Worth” of a Person at any date means the amount by which the assets of such
Person and its consolidated Restricted Subsidiaries (less any revaluation or other write-up
subsequent to the date of the Indenture in any such assets (other than write-ups resulting from
foreign currency translations and writeups of tangible assets of a going concern business made
within twelve months after the acquisition of such business)) exceed the sum of (a) the total
liabilities of such Person and its consolidated Restricted Subsidiaries, plus (b) any Disqualified
Stock of such Person or any consolidated Restricted Subsidiaries of such Person issued to any
Person other than such Person or a Wholly Owned Restricted Subsidiary of such Person, in each
case determined in accordance with GAAP.
“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.
“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), or upon the happening of any event,
matures or is mandatorily redeemable or redeemable at the option of the Holder thereof, in
whole or in part, on or prior to the date on which is 91 days after the date that the Notes
mature.
“$”, “dollars” and “U.S. dollars” denote the lawful currency of the United States of America.
“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).
“Exchange Act” means the U.S. Securities Exchange Act of 1934.
“Existing Indebtedness” means the Indebtedness of the Company and its Restricted Subsidiaries
in existence on the date of the Indenture (including, without limitation, Indebtedness
outstanding under any Term Facility) until such Indebtedness is repaid, other than Indebtedness
owed to the Company or any of its Restricted Subsidiaries; provided that the Company’s 12%
Notes due 2006 (the “Dividend Notes”) shall constitute “Existing Indebtedness” only up to and
129