SC 13D

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D
(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)

(Amendment No. ___)*

ADVANCED LIGHTING TECHNOLOGIES, INC.

(Name of Issuer)

Common Shares, $0.001 par value per share

(Title of Class of Securities)

00753C 10 2

(CUSIP Number)

Richard A. Petrocelli
Saratoga Management Company LLC
     535 Madison Avenue
New York, New York 10022
(212) 906-7800

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) 

August 15, 2003

(Date of Event which Requires Filing of this Statement)

     If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box o.

     Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

     * The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

     The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Page 1 of 24

CUSIP No. 00753C 10 2 13D Page 2 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Saratoga Lighting Holdings LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* OO

CUSIP No. 00753C 10 2 13D Page 3 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Saratoga Partners IV, L.P. I.R.S. No. 13-4013670
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* PN

CUSIP No. 00753C 10 2 13D Page 4 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Saratoga Coinvestment IV LLC I.R.S. No. 13-4013670
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* OO

CUSIP No. 00753C 10 2 13D Page 5 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Saratoga Associates IV LLC I.R.S. No. 13-4013667
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* OO

CUSIP No. 00753C 10 2 13D Page 6 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Saratoga Management Company LLC I.R.S. No. 13-4013664
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* OO

CUSIP No. 00753C 10 2 13D Page 7 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) John P. Birkelund
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* OO, PF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* IN

CUSIP No. 00753C 10 2 13D Page 8 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Charles P. Durkin, Jr.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* OO, PF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* IN

CUSIP No. 00753C 10 2 13D Page 9 of 24 Pages

1	NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Christian L. Oberbeck
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) o  (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS* OO, PF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) N/A o
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER None
		8	SHARED VOTING POWER 4,475,351
		9	SOLE DISPOSITIVE POWER None
		10	SHARED DISPOSITIVE POWER 4,475,351
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,475,351 – See Item 5
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 16.7% – See Item 5
14	TYPE OF REPORTING PERSON* IN

Item 1. Security and Issuer.

     The class of equity securities to which this statement relates is the common shares, $ 0.001 par value per share (“Common Stock”), of Advanced Lighting Technologies, Inc. an Ohio corporation (“ADLT”). The principal executive offices of ADLT are located at 32000 Aurora Road, Solon, Ohio 44139.

Item 2. Identity and Background.

     This Schedule 13D is being filed jointly on behalf of the following persons (collectively, the “Reporting Persons”): (1) Saratoga Lighting Holdings LLC, a Delaware limited liability company (“Saratoga Lighting”); (2) Saratoga Partners IV, L.P., a Delaware limited partnership (“Saratoga Partners”); (3) Saratoga Coinvestment IV LLC, a Delaware limited liability company (“Saratoga Coinvestment”); (4) Saratoga Associates IV LLC, a Delaware limited liability company (“Saratoga Associates”); (5) Saratoga Management Company LLC, a Delaware limited liability company (“Saratoga Management”); (6) John P. Birkelund; (7) Charles P. Durkin, Jr.; and (8) Christian L. Oberbeck (the parties named in clauses (6) through (8) are hereinafter referred to as the “Saratoga Individuals”).

     Saratoga Lighting is a Delaware limited liability company which makes investments for long-term appreciation. Saratoga Management is the Managing Member of Saratoga Lighting and makes all of the management and investment decisions on behalf of Saratoga Lighting.

     Saratoga Partners is a Delaware limited partnership which makes investments for long-term appreciation. Saratoga Associates is the General Partner of Saratoga Partners. Saratoga Associates has appointed Saratoga Management as Manager of Saratoga Partners. Saratoga Management along with Saratoga Associates makes all of the management and investment decisions on behalf of Saratoga Partners.

     Saratoga Coinvestment is a Delaware limited liability company which makes investments for long-term appreciation. Saratoga Management is the Managing Member of Saratoga Coinvestment and makes all of the management and investment decisions on behalf of Saratoga Coinvestment.

     Saratoga Associates is a Delaware limited liability company. As the General Partner of Saratoga Partners, Saratoga Associates participates in management decisions made on behalf of Saratoga Partners. Saratoga Associates is managed by an Executive Committee, the membership of which is set forth in Schedule A.

     Saratoga Management is a Delaware limited liability company. As the Manager of Saratoga Partners, Saratoga Management is responsible for the day to day management of Saratoga Partners and participates in investment decisions made on behalf of Saratoga Partners. As the Managing Member of Saratoga Lighting and Saratoga Coinvestment, Saratoga Management participates in investment decisions made on behalf of Saratoga Lighting and Saratoga Coinvestment. Saratoga Management is managed by an Executive Committee, the membership of which is set forth in Schedule B.

     The address of the principal business and office of each of the Reporting Persons is 535 Madison Avenue, New York, New York 10022.

     The name, business address, citizenship, present principal occupation or employment and the name and business address of any corporation or organization in which each such employment is conducted, of each of the Executive Committee Members of Saratoga Associates and Saratoga Management are set forth on Schedules A and B, respectively, attached hereto.

     During the past five years, none of the Reporting Persons has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject, to federal or state securities laws or finding any violation with respect to such laws.

Page 10 of 24

Item 3. Source and Amount of Funds or Other Consideration.

     Saratoga Lighting paid an aggregate purchase price of $12,000,000 in cash from its working capital. In addition, pursuant to section 6.07 of the Saratoga/GE Stock Purchase Agreement (defined in Item 4 below and attached hereto as Exhibit 2), if at any time ADLT has a confirmed chapter 11 plan of reorganization that has become effective, and Saratoga Lighting and/or any one or more of its affiliates has the right, directly or indirectly, to elect a majority of the members of the board of directors of ADLT or any one or more of its successors, then promptly thereafter Saratoga Lighting shall cause ADLT to offer GE (and keep such offer open for at least 30 days) the rebate program described on Schedule B to the Saratoga/GE Stock Purchase Agreement. If ADLT fails to offer GE such rebate program, conforming in all material respects with the program on Schedule B to the Saratoga/GE Stock Purchase Agreement, then Saratoga Lighting shall be liable to GE for $3,000,000.

Item 4. Purpose of Transaction.

     On August 15, 2003, Saratoga Lighting entered into an agreement with GE, acting through its GE Consumer Products business component, pursuant to which Saratoga Lighting purchased 1,429,590 shares of Common Stock and 761,250 shares of ADLT Series A Convertible Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”), convertible at any time into 3,045,761 shares of Common Stock (the “Saratoga/GE Stock Purchase Agreement”). The Common Stock and Series A Preferred Stock represent (after giving effect to the conversion of the Series A Preferred Stock into Common Stock) approximately 16.7% of the voting power and equity ownership in ADLT.1

     Under the Saratoga/GE Stock Purchase Agreement, GE, subject to the receipt of any necessary consents and court approvals, assigned to Saratoga Lighting all right, title and interest of GE under (i) the Contingent Warrant Agreement dated as of September 30, 1999 (as subsequently amended) by and among ADLT, GE and the other parties identified on the signature pages thereto (the “Contingent Warrant Agreement”), (ii) the Registration Rights Agreement dated as of September 30, 1999 (as subsequently amended) by and among GE and the other parties listed on the signature pages thereto (the “Registration Rights Agreement”), (iii) the Right of First Refusal and Co-Sale Agreement dated as of September 30, 1999 (as subsequently amended) by and among GE and the other parties listed on the signature pages thereto (the “Right of First Refusal and Co-Sale Agreement”), (iv) the Option Agreement dated as of September 30, 1999 (as subsequently amended) by and among GE and the other parties listed on the signature pages thereto (the “Option Agreement”), (v) the Stock Purchase Agreement dated as of September 28, 1999 (as subsequently amended) by and between GE and ADLT (the “GE/ADLT Stock Purchase Agreement”), and (vi) the Irrevocable Proxies granted to GE and dated October 6, 1999 (the “Irrevocable Proxies”).

     The purpose of the acquisition of the Common Stock and Series A Preferred Stock and the related rights by Saratoga Lighting was to enable Saratoga Lighting to seek confirmation of a chapter 11 plan of reorganization that ADLT and Saratoga Lighting co-proposed and filed on August 15, 2003 with the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division, in case no. 03 B 05255 (the “Plan”, attached hereto as Annex A to Exhibit 3). ADLT is one of the debtors in chapter 11 cases jointly administered under case no. 03 B 05255. Under the Plan, if confirmed, Saratoga Lighting would control ADLT. On August 29, 2003, ADLT filed its Disclosure Statement with Respect to First Amended Chapter 11 Plan of Reorganization dated August 15, 2003 (the “Disclosure Statement”, attached hereto as Exhibit 3).

      Capitalized terms used in subsections (a) – (j) but not otherwise defined herein are as defined in the Plan. Except as described below, the Reporting Persons have no current plans or proposals which relate to or would result in any of the events described in Items (a) through (j) of Item 4 of this Schedule 13D:

1 Saratoga Lighting purchased 1,429,590 shares of Common Stock and 761,250 shares of Series A Preferred Stock. Saratoga Lighting is deemed to beneficially own 1,429,590 shares of Common Stock plus the number of shares of Common Stock that the shares of Series A Preferred Stock can convert into, which amounts to a total of 3,045,761 shares of Common Stock. This total (4,475,711) is divided by the total number of shares of Common Stock deemed outstanding, which is 26,853,108. Thus, Saratoga Lighting beneficially owns 4,475,711/26,853,108 = 16.67% of the deemed outstanding number of shares of ADLT Common Stock.

Page 11 of 24

     (a) In October 1999, pursuant to the GE/ADLT Stock Purchase Agreement, GE completed an investment in ADLT of approximately $20,554,000. In exchange for the investment, GE received 761,250 shares of the Series A Preferred Stock, which are convertible at any time into 3,045,761 shares of Common Stock (subject to adjustment). GE also received a Warrant to purchase up to an additional 1,000,000 shares of Common Stock (subject to adjustment), which GE fully exercised to acquire 998,703 shares of Common Stock.

     The Series A Preferred Stock has a liquidation preference of $27 per share, plus an amount equal to 8% per annum compounded annually from the date of issuance to the date of payment. ADLT is required to redeem any shares of Series A Preferred Stock which have not been converted or retired on September 30, 2010. In addition, Saratoga Lighting may, by notice, require ADLT to redeem the outstanding Series A Preferred Stock, within one year following either September 30, 2004, or the occurrence of certain corporate events.

      The terms of the Contingent Warrant Agreement provide that ADLT maintain an interest-coverage ratio over certain measurement periods. ADLT failed to maintain the required interest-coverage ratio over three measurement periods. As a result of the failure to maintain the interest-coverage ratio:

     (i) GE acquired (and Saratoga Lighting has, subject to any necessary consents and required bankruptcy court approvals, if any, succeeded to) the right to vote the number of shares currently voted by the Chief Executive Officer of ADLT, Wayne R. Hellman, and Alan J. Ruud, totaling approximately 5.6 million shares of Common Stock (as of December 31, 2002),

     (ii) GE held (and Saratoga Lighting has, subject to any necessary consents and required bankruptcy court approvals, if any, succeeded to) an option to purchase shares from Messrs. Hellman and Ruud which, together with the shares owned by Saratoga Lighting, would represent 25% of the voting power of ADLT,

     (iii) GE held (and Saratoga Lighting has, subject to any necessary consents and required bankruptcy court approvals, if any, succeeded to) the right to receive from ADLT an additional warrant to purchase approximately 6.75 million shares at $.63055 per share (the average of the closing prices for the 20 trading days ended September 30, 2002) (the “First Contingent Warrant”), and

     (iv) GE held (and Saratoga Lighting has, subject to any necessary consents and required bankruptcy court approvals, if any, succeeded to) the right to receive from ADLT an additional warrant to purchase approximately 18,000 shares at $.298 per share (the average of the closing prices for the 20 trading days ended December 31, 2002) (the “Second Contingent Warrant”).

     Pursuant to the Saratoga/GE Stock Purchase Agreement, as to the sale to Saratoga Lighting of related rights that require ADLT consent, GE will, upon receipt of any necessary consents and required bankruptcy court approvals, take all reasonable and necessary steps to transfer the related rights (specified in (i) – (iv) above) so that they may be effectively held and exercised by Saratoga Lighting to the same extent as if they were delivered at the execution of the Saratoga/GE Stock Purchase Agreement, on the assumption that no such consents and approvals were ever called for. In addition, GE agreed to use commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all other things necessary or desirable under applicable laws and regulations to consummate the transactions contemplated by the Saratoga/GE Stock Purchase Agreement. In addition, GE agreed that, in the event there are agreements, written or oral, among or on behalf of, on the one hand, any of the ADLT and/or the shareholders of ADLT and, on the other hand, GE or any of its affiliates that relate, directly or indirectly, to GE’s rights and obligations with respect to the Common Stock and Series A Preferred Stock purchased under the Saratoga/GE Stock Purchase Agreement and that have not been assigned to Saratoga Lighting, GE shall, if directed by Saratoga Lighting in its sole and absolute discretion, assign to Saratoga Lighting all rights, title and interest of GE under such agreements, subject to ADLT obtaining all necessary consents and required bankruptcy court approvals, if any.

     The Common Stock and Series A Preferred Stock acquired pursuant to the Saratoga/GE Stock Purchase Agreement represent (after giving effect to the conversion of the Series A Preferred Stock into Common Stock) approximately 16.7% of the voting power and equity ownership in ADLT. However, the total number of shares that Saratoga Lighting and/or GE owns or has a right to acquire and/or vote, such amount including those securities specified in items (i) – (iv) of this Item 4(a) above, exceeds 35% of the voting power of ADLT. Consequently, the

Page 12 of 24

terms of the Old Indenture relating to the Old Notes require that ADLT offer to repurchase the $100 million principal amount of the outstanding Old Notes at a price of 101% of the principal amount thereof, plus accrued interest. ADLT elected not to offer to repurchase the Old Notes and therefore is in default under the Old Indenture. Exercise of remedies on behalf of the Old Note Holders has been stayed by the automatic stay in ADLT’s chapter 11 case.

     Class 6 under the Plan comprises ADLT’s Series A Preferred Stock (761,250 shares issued and outstanding) and any contingent, disputed or unliquidated Claims related thereto or in connection therewith. Saratoga Lighting holds Class 6 Interests in 761,250 shares of Series A Preferred Stock; such Interests of Saratoga Lighting will be allowed under the Plan, upon its confirmation. On or as soon as practicable after the Effective Date, Saratoga Lighting, in full satisfaction, settlement, release, extinguishment and discharge of such Series A Preferred Stock, and upon payment by Saratoga Lighting to ADLT of $18,000,000 in cash, shall receive 29,000 shares of New Preferred Stock and 1,000 shares of New Common Stock, such that the holders of the Allowed Class 6 Preferred Interests shall have received 100% of the issued and outstanding New Preferred Stock (all of which will be held by Saratoga Lighting), 100% of the shares of New Common Stock issued and outstanding on the Effective Date and 90.8% of the Fully Diluted New Common Stock. Acceptance of the Plan by Class 6 shall, subject to consummation of the Plan, constitute an approval, as recipient of New Common Stock, of the Management Incentive Plan and the Senior Management Contracts (see section (d) below).

     If the Plan is confirmed, the Common Stock will be cancelled. After confirmation, each share of the New Common Stock will have one vote on all matters on which stockholders are entitled or permitted to vote, including the election of directors and such stockholders do not have cumulative voting rights. Holders of New Common Stock will be entitled to share ratably in dividends declared by the Board of Directors out of funds legally available therefor. Saratoga Lighting does not expect ADLT to declare or pay cash dividends to holders of New Common Stock in the foreseeable future. All the New Common Stock to be issued under the Plan will be fully paid and nonassessable and the holders thereof will have no preferences or conversion, exchange or pre-emptive rights. In the event of any liquidation, dissolution or winding-up of the affairs of ADLT, holders of New Common Stock will be entitled to share ratably in the assets of ADLT remaining after payment of, or provision for payment of, all of ADLT’s debts and obligations, including those arising in connection with the New Preferred Stock.

     Class 7 under the Plan comprises the Common Stock (23,807,347 shares issued and outstanding) and any contingent, disputed or unliquidated Claims related thereto or in connection therewith. Saratoga Lighting holds Class 7 Interests in 23,807,347 shares of Common Stock; such Interests of Saratoga Lighting will be allowed under the Plan, upon its confirmation. Class 7 Common Interests will be impaired by the Plan. If Class 7 accepts the Plan pursuant to §1129(a)(8) of the Bankruptcy Code then, on or as soon as practicable after the Effective Date, each holder of an Allowed Class 7 Interest as of the Distribution Record Date (and any holders in Class 8, other than Saratoga Lighting, electing to exercise their rights as set forth in section 3.13 of the Plan) shall receive, in full satisfaction, settlement, release, extinguishment, cancellation and discharge of such Interest, for each share of Common Stock held by such holder, the sum of $0.1197 (11.97 cents) per share (based on 23,807,347 shares outstanding) payable such that the holders of Class 7 Common Interests shall have received in the aggregate $2,850,000; provided, however, that the cash distributions to be received by such holders shall be reduced by the aggregate amount of allowed professional claims of professionals retained by or on behalf of the Equity Committee, up to $350,000, such that, at a minimum, such holders shall have received in the aggregate $2,500,000 (resulting in a cash distribution of $0.105 (10.5 cents) per share of Common Stock (based on 23,807,347 shares outstanding)).

     If Class 7 does not accept the Plan pursuant to §1129(a)(8) of the Bankruptcy Code then they will be entitled to $2,500,000, pro rata, including Saratoga Lighting, payable in quarterly installments of 24% of the amount payable to such holder starting, with respect to each holder of a Class 7 Interest, on the later of (i) the first calendar-quarter-end date after the Effective Date and (ii) the calendar-quarter-end date next following the date on which each such Common Stock Interest shall have become allowed, and on each of the next succeeding calendar-quarter-end dates thereafter, until such Allowed Old Common Stock Interest is paid in full the amount provided for in Section 3.12 of the Plan, subject to the proviso that on the 364^th day after the Effective Date of the Plan, each such holder shall receive the entire then-unpaid balance of the amount due under the Plan in respect of such Class 7 Interest, without interest. Regardless of the foregoing, holders of Old Common Stock Interests that remain disputed on such 364^th day shall be entitled to receive 100% of the amount due on their Allowed Interest on the date of allowance thereof.

Page 13 of 24

All payments to holders of Class 7 Old Common Stock Interests shall be made in cash unless otherwise agreed between reorganized ADLT and the holder of such Interest. No interest will accrue or be payable on Class 7 Old Common Stock Interests or the payments made to holders thereof.

     Class 8 comprises all other equity Interests in ADLT, including, without limitation, holders of options, warrants, conversion privileges or other legal or contractual rights to acquire ADLT’s Common Stock or other Old Other Interests. To the extent of its beneficial ownership as described in items (i) – (iv) of Item 4(a) above, Saratoga Lighting holds Class 8 interests. Saratoga Lighting has been told that there are approximately 830 Old Other Interests. Each holder of an Old Other Interest, including Saratoga Lighting, shall have the right to exercise its options, warrants, conversion privileges or other legal or contractual rights to obtain Common Stock representing such Interest, which shall become fully vested as of the date of exercise of such right notwithstanding any provision to the contrary in the contract or instrument giving rise to such Interest. To exercise such right, such holder shall (i) mark or check off the applicable box on the ballot cast by such holder indicating such holder’s exercise of such right and (ii) on or before the Effective Date, pay all required consideration and otherwise satisfy all other applicable conditions in order to exercise such right. If such holder timely exercises its right to obtain such Common Stock, such holder shall be entitled to the treatment provided to Class 7 set forth in Section 3.12 of the Plan with respect to such Common Stock. If such holder fails to timely exercise its right to obtain such Common Stock, such holder’s Old Other Interest shall be canceled and extinguished and such holder shall not receive or retain any property under the Plan on account of such Interest. Saratoga Lighting does not expect itself to exercise any of its rights of a holder of an Old Other Interest and it does not expect that any other holder of an Old Other Interest will do so either.

     (b) On February 5, 2003, ADLT and certain affiliated entities filed a voluntary petition to commence chapter 11 proceedings, which are currently pending in the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division, case no. 03 B 05255. The Plan and Disclosure Statement set forth ADLT’s plans and proposals relating to its reorganization. In order for ADLT to complete the currently contemplated reorganization, it must receive approval of the Plan from the holders of at least one Impaired Class of Claims, as provided by the Bankruptcy Code, as well as receive confirmation of the Plan by the Bankruptcy Court. If the Plan is confirmed, even if a holder of Claim or Interest did not vote or voted against the Plan, the Plan’s proposed treatment of such holder’s Claim or Interest will be binding on such holder.

     More specifically, the approvals required with respect to the holders of Impaired Claims and Interest are as follows:

     ADLT must receive approval of the Plan from (a) with respect to each Impaired Class of Claims entitled to vote on the Plan (i) the holders of Claims holding at least two-thirds (2/3) in amount of such Claims actually voting in such Class (other than Claims held by any holder designated pursuant to section 1126(e) of the Bankruptcy Code) and (ii) more than one-half (1/2) in number of the holders of such Claims actually voting in such Class (other than Claims held by any holder designated pursuant to section 1126(e) of the Bankruptcy Code); and (b) with respect to each Impaired Class of Interests entitled to vote on the Plan, the holders of such Interests holding at least two-thirds (2/3) in amount of such Interests actually voting in such Class (other than Interests held by any holder designated pursuant to section 1126(e) of the Bankruptcy Code). Additionally, ADLT reserves the right to request that the Bankruptcy Court confirm the Plan in accordance with section 1129(b) of the Bankruptcy Code if at least one Impaired Class of Claims approves the Plan, notwithstanding a failure to meet the requirements of section 1129(a)(8) thereof, on the basis that the Plan is fair and equitable, and does not discriminate unfairly, with respect to each Class of Claims or Interests that is Impaired under, and has not accepted, the Plan.

     (c) To the best of the Reporting Persons’ knowledge, no sale or transfer of a material amount of assets is contemplated.

     (d) Management. Saratoga Lighting expects that the following executive officers will continue to serve after confirmation of the Plan (except as otherwise noted below). These individuals are:

     Wayne R. Hellman—Chief Executive Officer (ADLT); President (ADLT Services, Ballastronix, LRI and Microsun).

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     Steven C. Potts—Chief Financial Officer, Treasurer & Secretary (ADLT, ADLT Services, Ballastronix, LRI and Microsun); Vice President and Chief Financial Officer (APL); Secretary and Treasurer (VLI). Mr. Potts is currently scheduled to leave ADLT at or about the time his replacement joins ADLT.

      Sabu Krishnan—Chief Operating Officer (ADLT) and President (VLI).

      Leroy Bartolomei—Vice President (ADLT) and President (non-debtor DSI).

      James L. Schoolenberg—Vice President (ADLT); Chief Executive Officer and President (APL).

      Wayne Platt—Executive Vice President (ADLT).

     Board of Directors. Except as noted below, during the Chapter 11 Cases Wayne R. Hellman, Francis H. Beam, John E. Breen, Theodore Filson, Louis S. Fisi, John Gonzalez, James Mohn and A. Gordon Tunstall continued as the members of ADLT’s Board of Directors; Sabu Krishnan was appointed to the Board on April 22, 2003. On August 15, 2003, when Saratoga Lighting purchased GE’s equity interests in and to ADLT and pursuant to the Saratoga/GE Stock Purchase Agreement, Messrs. Breen and Mohn (GE’s nominees to the Board) resigned. Upon such resignations, the remaining Board members elected Saratoga Lighting representatives Christian Oberbeck and Damon Ball to fill these Board vacancies, with the incumbency not to commence until their written acceptance thereof. To date, Mr. Oberbeck and Mr. Ball have not accepted these directorships. Starting immediately, Messrs. Oberbeck and Ball will receive any and all notices and communications that the other members of the Board of Directors receive.

     From and after the Effective Date, Saratoga Lighting expects that there will be seven (7) members of the reorganized ADLT’s Board of Directors: Wayne Hellman, Sabu Krishnan, Christian Oberbeck, Damon Ball, Richard Petrocelli and two additional individuals appointed by Saratoga Lighting in consultation with ADLT’s management. The identities and/or biographies of the reorganized ADLT’s new Board members are not known at this time and will be set forth in the final version of the Disclosure Statement filed with the Bankruptcy Court.

     During the Chapter 11 Cases, Wayne R. Hellman has continued as the sole member of each of the Subsidiary Debtors. The Board of Directors for each of the Subsidiary Debtors shall consist of one (1) or more members to be appointed by reorganized ADLT’s Board of Directors.

     Management Incentive Plan. On the Effective Date, Saratoga Lighting expects that the reorganized ADLT will adopt and implement the Management Incentive Plan (the 2003 Equity Incentive Plan of Advanced Lighting Technologies, Inc.) under which the management options will become effective and will vest, while the recipient continues in our employ, in four annual installments. Under the Management Incentive Plan, certain members of senior management will be entitled to receive management options to purchase in the aggregate 9.2% of the fully diluted New Common Stock. The percentages of New Common Stock or other incentives to be issued to members of senior management will be set forth in the final version of the Disclosure Statement filed with the bankruptcy court.

     Senior Management Contracts. On the Effective Date, Saratoga Lighting expects that the reorganized ADLT will enter into new employment agreements with certain members of senior management, consisting of Wayne R. Hellman, Sabu Krishnan, James L. Schoolenberg, Leroy Bartolomei, Wayne Platt and the individual appointed as the new chief financial officer (to replace Steven Potts) of ADLT or reorganized ADLT (as the case may be). The new employment agreements will provide for employment of such executives commencing on and after the Effective Date of the Plan. The monetary and certain other terms of the employment agreements will be set forth in the final versions of the Disclosure Statement and the employment agreements themselves filed with the bankruptcy court.

     Saratoga Lighting expects that the reorganized ADLT will implement a retention bonus program pursuant to which Wayne Hellman will receive a retention bonus payable in two equal installments on July 1, 2004 and July 1, 2005. The amount of the retention bonus to be paid to Hellman will be set forth in the final version of the Disclosure Statement filed with the Bankruptcy Court.

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     Hellman Loan. Pursuant to an agreement dated October 8, 1998, as amended, between ADLT and its Chairman and Chief Executive Officer, Wayne R. Hellman, ADLT has a loan recorded for approximately $14,144,000 to Mr. Hellman, including principal of approximately $12,789,000 and accrued interest as of June 30, 2001; subsequent accrued interest of $1,503,000 as of June 30, 2003 has not been recorded due to the uncertainty of Mr. Hellman’s available assets to repay the loan. The proceeds of the loan were used by Mr. Hellman to reduce the principal balance outstanding of margin loan accounts. In connection with the loan, ADLT obtained Mr. Hellman’s agreement to an extension of his employment agreement to December 31, 2003. The margin loans have been fully repaid and the loan agreement prohibits Mr. Hellman from encumbering his ADLT shares in any manner without the consent of ADLT. On July 26, 2002, ADLT and Mr. Hellman executed an amendment to the loan documents, implementing the agreement in principle, reached in January 2002, to extend the maturity of the loan to July 31, 2007. Under the terms of the amendment, Mr. Hellman was required to sell certain assets in an orderly manner to maximize the net proceeds to be used to pay a portion of the loan. In addition, Mr. Hellman agreed to apply any after-tax cash bonuses earned from ADLT toward repayment of the loan. The loan may be accelerated if Mr. Hellman ceases to be employed by ADLT as a result of his voluntary resignation or termination for cause. Pursuant to the Plan, the reorganized ADLT will forgive the Hellman Loan except to the extent of Mr. Hellman’s estimated net worth.

     (e) Saratoga Lighting believes that ADLT plans to make material changes in the capitalization of ADLT pursuant to the Plan. Currently, ADLT has 80,000,000 authorized shares of Common Stock, 23,807,347 of which are issued and outstanding. Currently, ADLT has 1,000,000 authorized shares of Series A Preferred Stock, 761,250 of which are issued and outstanding. The Plan provides that as of the Effective Date all of these shares will be cancelled. After the Effective Date, there will be 80,000,000 authorized shares of New Common Stock, with 1,000 shares of New Common Stock issued to Saratoga Lighting. After the Effective Date, Saratoga Lighting will also have 29,000 shares of New Preferred Stock. Saratoga Lighting shall have received 100% of the issued and outstanding New Preferred Stock, and Saratoga Lighting shall have received 100% of the shares of New Common Stock issued and outstanding on the Effective Date and 90.8% of the fully diluted New Common Stock. The par value of the New Common Stock and New Preferred Stock will be $.001.

     ADLT currently has Old Note Claims in the principal amount of $100,000,000. The Debtors estimate that there are approximately 70 holders of Old Note Claims; the Old Indenture Trustee has filed a proof of claim on behalf of all holders of Old Notes in the aggregate amount of $107,238,350.35. The Old Note Claims (which are “Class 3” in the Plan) will be treated under the Plan as follows:

     (A) if Class 3 accepts the Plan pursuant to §1129(a)(8)(A) of the Bankruptcy Code, such Old Note Claims shall be allowed in an aggregate amount equal to the sum of (i) $107,145,205 (being the sum of $100,000,000 plus interest at 8% from March 16, 2002 to the Petition Date) plus (ii) interest on the amount mentioned in (A)(i) above from the Petition Date to the Effective Date at the rate of 8% per annum, or

     (B) if Class 3 does not so accept the Plan, then such Old Note Claims shall be allowed in an aggregate amount equal to (i) $107,145,205 (being the sum of $100,000,000 plus interest at 8% from March 16, 2002 to the Petition Date) plus (ii) interest on the amount mentioned in (B)(i) above from the Petition Date to the Effective Date at that rate per annum which is the greater of:

     (1) 1.32% (such rate being (a) the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System for the week ending Friday January 31, 2003, the end of the calendar week preceding the Petition Date, and (b) specified as the interest rate allowed on judgments entered in federal courts pursuant to 28 U.S.C. §1961 and reported on the following site on the internet: http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

     (2) such other rate per annum as the Bankruptcy Court determines is legally required by the applicable provisions of the Bankruptcy Code for accruals of post-petition interest on unsecured debt.

     Class 3 Old Note Claims are Impaired by the Plan. On or as soon as practicable after the Effective Date, each holder of an Allowed Old Note Claim as of the Distribution Record Date shall receive from the Disbursing Agent, in full satisfaction, settlement, release, extinguishment and discharge of such Claim, a New Note in a principal amount equal to:

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      (A) the unpaid principal amount of such Old Note held by such holder, plus

      (B) the amount of interest accrued but unpaid on such Old Note from March 16, 2002 to the Petition Date, plus

      (C) interest on an amount equal to the sum of (A) and (B) in this sentence from the Petition Date to the Effective Date at the applicable rate as provided above in section 3.08 (A) or (B) of the Plan.

     Acceptance of the Plan by Class 3 shall, subject to consummation of the Plan, constitute a waiver by all holders of Class 3 Old Note Claims of any and all defaults under the Old Indenture that may exist as of the Effective Date, and an agreement to instruct the Old Indenture Trustee to take all actions to effectuate the Plan. The terms of the Notes, to the extent presently known, are as described in the New Indenture, attached as Exhibit D to Exhibit 4 hereto.

      (f) To the best of the Reporting Persons’ knowledge, no such material change is contemplated.

      (g) Saratoga Lighting believes that ADLT, on the Effective Date, plans to amend its current articles of incorporation to ensure that the requirements of 11 U.S.C. § 1123(b)(6) are satisfied, such that the articles of incorporation will include a provision prohibiting the issuance of nonvoting equity securities, and providing, as to the several classes of securities possessing voting power, an appropriate distribution of such power among such classes, including, in the case of any class of equity securities having a preference over another class of equity securities with respect to dividends, adequate provisions for the election of directors representing such preferred class in the event of default in the payment of such dividends. The amendment will be filed on the Effective Date. In addition, the reorganized ADLT Board of Directors will pass resolution adopting a Certificate of Designation setting forth the terms of the New Preferred Stock which will also be filed on the Effective Date. Saratoga Lighting expects to continue to urge ADLT to support extensions of ADLT’s exclusive right to file a chapter 11 plan and to solicit approvals of the Plan. As long as ADLT accepts Saratoga Lighting’s urging and ADLT supports the current Plan, a principal effect will be to impede the control or acquisition of ADLT by any other person.

     (h) The Common Stock was delisted from Nasdaq on January 10, 2003 and is currently traded on the over-the-counter bulletin board under the symbol “ADLTQ.OB.” The reported closing price of the Common Stock on June 30, 2003 was $0.09 per share. On the Effective Date, the reorganized ADLT will deregister as a registered issuer of equity securities under Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Act”) and will not list the New Common Stock in any public market. Periodic reporting to the Commission after the Effective Date is not required under existing law.

     (i) Pursuant to the Plan, all Common Stock and Series A Preferred Stock will be cancelled, and all Old Other Interests that are not timely exercised in accordance with the Plan will be cancelled. Thus, these classes of equity securities of ADLT will be eligible for termination of registration pursuant to Section 12(g)(4) of the Act due to the fact that the number of holders of record of each class of security will be reduced to less than 300 persons. Saratoga expects that the New Indenture for the New Notes will be qualified under the Trust Indenture Act of 1939, as amended. Under present law, as Saratoga understands it, the fact of this qualification does not require ADLT to file reports under the Act as amended.

      (j) The Reporting Persons are not aware of any similar such actions other than those described herein.

      Item 5. Interest in Securities of the Issuer.

     (a) and (b) Saratoga Lighting has acquired 1,429,590 shares of Common Stock and 761,250 shares of Series A Convertible Preferred Stock that may be converted into 3,045,761 shares of Common Stock, representing 16.7% of the outstanding Common Stock (after giving effect to the conversion of the Series A Preferred Stock into Common Stock).

     Each of Saratoga Lighting, Saratoga Partners, Saratoga Coinvestment, Saratoga Associates, Saratoga Management and the Saratoga Individuals may be deemed to beneficially own the shares of Common Stock and Series A Preferred Stock held by Saratoga Lighting (collectively, the “Investors' Shares”). As the Managing Member of Saratoga Lighting, Saratoga Partners may be deemed, for purposes of Rule 13d-3 under the Act, to

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beneficially own indirectly the Investors’ Shares that may be deemed to be beneficially owned by Saratoga Lighting. As the general partner of Saratoga Partners, Saratoga Associates may be deemed, for purposes of Rule 13d-3 under the Act, to beneficially own indirectly the Investors’ Shares that may be deemed to be owned beneficially by Saratoga Partners. As the Manager of Saratoga Partners and the Managing Member of Saratoga Coinvestment, Saratoga Management may be deemed, for purposes of Rule 13d-3 under the Act, to beneficially own indirectly the Investors’ Shares that may be deemed to be owned beneficially by Saratoga Partners. Because of the Saratoga Individuals’ ownership interest in Saratoga Associates and Saratoga Management, the Saratoga Individuals may be deemed, for purposes of Rule 13d-3 under the Act, to beneficially own indirectly the Investors’ Shares that may be deemed to be beneficially owned indirectly by Saratoga Associates and Saratoga Management. Each of Saratoga Partners, Saratoga Coinvestment, Saratoga Associates, Saratoga Management and the Saratoga Individuals disclaims beneficial ownership of the Investors’ Shares.

     (c) Except as disclosed herein, neither the Reporting Persons, nor, to the best of the knowledge of the Reporting Persons, any of its directors or executive officers, has effected any transaction in the Common Stock in the past 60 days.

      (d) Not applicable.

      (e) Not applicable.

      Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

     Capitalized terms used in subsections (a) – (i) but not otherwise defined in this Schedule 13D are as defined in the Contingent Warrant Agreement, which is attached hereto as Exhibit 6.

     (a) SARATOGA/GE STOCK PURCHASE AGREEMENT: Under the Saratoga/GE Stock Purchase Agreement, GE assigned to Saratoga Lighting all right, title and interest of GE under (i) the Contingent Warrant Agreement, (ii) the Registration Rights Agreement, (iii) the Right of First Refusal and Co-Sale Agreement, (iv) the Option Agreement, (v) the GE/ADLT Stock Purchase Agreement and (vi) the Irrevocable Proxies.

      (b) THE PLAN. Described in Item 4 above.

      (c) GE/ADLT STOCK PURCHASE AGREEMENT. Under the GE/ADLT Stock Purchase Agreement, the number of the Saratoga Lighting's nominees serving on the Board of Directors of ADLT must at all times be equal to the greater of (i) 20% of the number of members of ADLT’s Board of Directors or (ii) that number of members that corresponds most nearly to the Reporting Persons’ percentage ownership interest in ADLT.

     (d) IRREVOCABLE PROXIES. The various proxies granted to Saratoga Lighting are described in Item 4(a). The proxies are granted by Wayne R. Hellman, Hellman, LTD. and Alan J. Ruud. Regardless of when they become effective, the proxies all expire at the same time, which is the earlier of (i) eleven years from the date of the Second Occurrence under the Contingent Warrant or (ii) September 30, 2010 if Saratoga has not received notice of a Second Occurrence or Third Occurrence within the three year period prior to September 30, 2010.

     (e) RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT. Saratoga Lighting has the right of first refusal with respect to any sales of 1,000 shares or more (whether in one transaction or a series of related transactions) by Wayne R. Hellman, Alan J. Ruud or Hellman, LTD. Saratoga Lighting has the right to purchase such shares on the same terms as offered to a third party or at market prices for open market sales. Saratoga Lighting must exercise its right of first refusal within twenty days of receiving notice (or within two days for open market sales). Saratoga Lighting also has the right to participate in any sales by Wayne R. Hellman, Alan J. Ruud or Hellman, LTD. of blocks of 1,000 shares or more.

     (f) OPTION AGREEMENT. Saratoga Lighting is granted an option from each of Wayne R. Hellman and Alan J. Ruud to purchase shares upon a Second Occurrence under the Contingent Warrant Agreement. The number of shares subject to the options is the number of shares that when combined with other shares owned by Saratoga Lighting will give Saratoga Lighting a 25% interest in ADLT. The options must be exercised in full. The options

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generally last for one year after Saratoga Lighting has received notice of the Second Occurrence. The option price is the current market price at the time of the Second Occurrence. Saratoga Lighting’s right to exercise the options is subject to approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act”).

     (g) REGISTRATION RIGHTS AGREEMENT. The Registration Rights Agreement relates to all Common Stock owned by Saratoga Lighting (whether by virtue of conversion of the Series A Preferred Stock, exercise of the Initial Warrant, the First Contingent Warrant or the Second Contingent Warrant or otherwise). The Registration Rights Agreement provides that Saratoga Lighting may make one demand for a long-form registration and unlimited demands for short-form registrations to have common shares owned by Saratoga Lighting registered pursuant to the Securities Act of 1933, as amended (the “Securities Act”). These demand registration rights are subject to certain limitations as a result of other stockholders exercising their demand rights. Saratoga Lighting also has certain “piggy-back” registration rights. Saratoga Lighting must be notified prior to the filing of any registration statement under the Securities Act by ADLT.

     (h) ARTICLES OF INCORPORATION. The express terms of the Series A Preferred Stock include a number of put rights in favor of Saratoga Lighting. The purchase price under all of Saratoga Lighting’s put rights is $27 per share, plus an amount equal to 8% per annum compounded annually from the date of issuance to the date of payment. Saratoga Lighting has the right to put the Series A Preferred Stock (i) on September 30, 2004 (the “General Put Right”), (ii) if within 365 days after Saratoga Lighting has filed its Notification and Report Form as required under the HSR Act in connection with a Second Occurrence under the Contingent Warrant Agreement ADLT and Saratoga Lighting are unable to obtain required governmental approval under the HSR Act or (iii) if ADLT takes any action to give effect to certain major corporate actions, including actions to merge, sell all or a substantial portion of its assets (other than in the ordinary course of business), issue capital stock, or incur or have outstanding indebtedness for borrowed money in excess of $210,000,000 (the "Occurrence Based Put Right"). If ADLT does not purchase the Series A Preferred Stock within the applicable closing period (generally a one year period from the date of notice of the put) in connection with the General Put Right or the Occurrence Based Put Right, the conversion ratio applicable to the Series A Preferred Stock increases from four to one to eight to one. Under the terms of the Series A Preferred Stock, the shares of Series A Preferred Stock are voted on an “as if” converted basis.

     (i) SECOND CONTINGENT WARRANT. The Second Contingent Warrant provides that if ADLT issues additional shares of Common Stock to anyone other than Saratoga Lighting, Saratoga Lighting will be entitled to purchase, on the same terms given to the third party, the number of shares required to maintain Saratoga Lighting's voting power.

     Except as described above, to the best knowledge of the Reporting Persons, there are no contracts, arrangements, understandings or relationships (legal or otherwise), including, but not limited to, transfer or voting of any of the securities, finder’s fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies, between the persons enumerated in Item 2, and any other person, with respect to any securities of the Issuer, including any securities pledged or otherwise subject to a contingency the occurrence of which would give another person voting power or investment power over such securities other than standard default and similar provisions contained in loan agreements.

      Item 7. Material to be Filed as Exhibits

      Exhibit 1: Joint Filing Agreement and Power of Attorney.

     Exhibit 2: Stock Purchase Agreement dated as of August 15, 2003 between Saratoga Lighting Holdings LLC and General Electric Company acting through its GE Consumer Products business component.

     Exhibit 3: Disclosure Statement with Respect to First Amended Chapter 11 Plan of Reorganization, co-proposed and filed on August 15, 2003 with the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division, in case no. 03 B 05255.

      Annex A: First Amended Chapter 11 Plan of Reorganization

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      Annex B: Financial Projections

      Annex C: Liquidation Analysis

     Exhibit 4: Exhibits to First Amended Chapter 11 Plan of Reorganization, co-proposed and filed on August 15, 2003 with the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division, in case no. 03 B 05255 (as filed on August 29, 2003 with the Bankruptcy Court).

      Exhibit A: Management Incentive Plan (unavailable on the date hereof)

      Exhibit B: New ADLT Articles of Incorporation

      Exhibit C: New ADLT Code of Regulations (By-Laws)

      Exhibit D: New Indenture

      Exhibit E: Saratoga Management Services Agreement

      Exhibit F: Forms of Senior Management Contract (unavailable on the date hereof)

      Exhibit 5: Stock Purchase Agreement, dated as of September 28, 1999, between Advanced Lighting Technologies, Inc. and General Electric Company, incorporated by reference to Exhibit A of Schedule 13D filed by General Electric Company on October 18, 1999 (SEC FILE NUMBER:005-46215) pursuant to the Act.

     Exhibit 6: Contingent Warrant Agreement, dated as of September 30, 1999, among Advanced Lighting Technologies, Inc., General Electric Company, Wayne R. Hellman, Hellman, Ltd., Wayne R. Hellman, as voting trustee under Voting Trust Agreement dated October 10, 1995, Alan J. Ruud, and Alan J. Ruud, as voting trustee under Voting Trust Agreement dated January 2, 1998, incorporated by reference to Exhibit B of Schedule 13D filed by General Electric Company on October 18, 1999 (SEC FILE NUMBER: 005-46215) pursuant to the Act (the Irrevocable Proxies are attached as Exhibits A – E to the Contingent Warrant Agreement).

     Exhibit 7: First Amendment to Contingent Warrant Agreement, dated as of August 31, 2000, incorporated by reference to Form 10-Q for the Quarterly Period ended September 30, 2000 filed by Advanced Lighting Technologies, Inc. on November 14, 2000 (SEC FILE NUMBER: 000-27202) pursuant to the Act.

     Exhibit 8: Second Amendment to Contingent Warrant Agreement, dated as of June 29, 2001, incorporated by reference to Exhibit 10.24 in Form 10-K for the Annual Period ended June 30, 2001 filed by Advanced Lighting Technologies, Inc. on September 28, 2001 (SEC FILE NUMBER: 000-27202) pursuant to the Act.

     Exhibit 9: Third Amendment to Contingent Warrant Agreement, dated as of September 28, 2001, incorporated by reference to Exhibit 10.1 in Form 10-Q for the Quarterly Period ended September 30, 2000 filed by Advanced Lighting Technologies, Inc. on November 14, 2001 (SEC FILE NUMBER: 000-27202) pursuant to the Act.

     Exhibit 10: Fourth Amendment to Contingent Warrant Agreement, dated as of December 31, 2001, incorporated by reference to Exhibit 10.2 in Form 10-Q for the Quarterly Period ended December 31, 2001 filed by Advanced Lighting Technologies, Inc. on February 14, 2001 (SEC FILE NUMBER: 000-27202) pursuant to the Act.

     Exhibit 11: Fifth Amendment to Contingent Warrant Agreement, dated as of March 31, 2002, incorporated by reference to Exhibit 10.3 in Form 10-Q for the Quarterly Period ended March 31, 2002 filed by Advanced Lighting Technologies, Inc. on May 15, 2002 (SEC FILE NUMBER: 000-27202) pursuant to the Act.

.

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     Exhibit 12: Sixth Amendment to Contingent Warrant Agreement, dated as of June 30, 2002, incorporated by reference to Exhibit 10.15 in Form 10-K for the Annual Period ended June 30, 2002 filed by Advanced Lighting Technologies, Inc. on October 15, 2002 (SEC FILE NUMBER: 000-27202) pursuant to the Act.

     Exhibit 13: Option Agreement, dated as of September 30, 1999, among General Electric Company, Wayne R. Hellman, and Alan J. Ruud, incorporated by reference to Exhibit C of Schedule 13D filed by General Electric Company on October 18, 1999 (SEC FILE NUMBER: 005-46215) pursuant to the Act.

     Exhibit 14: Registration Rights Agreement, dated as of September 30, 1999, between Advanced Lighting Technologies, Inc. and General Electric Company, incorporated by reference to Exhibit D of Schedule 13D filed by General Electric Company on October 18, 1999 (SEC FILE NUMBER: 005-46215) pursuant to the Act.

     Exhibit 15: Right of First Refusal and Co-Sale Agreement, dated as of September 30, 1999, by and among Wayne R. Hellman, Hellman, Ltd., an Ohio limited liability company, Alan J. Rudd and General Electric Company, incorporated by reference to Exhibit E of Schedule 13D filed by General Electric Company on October 18, 1999 (SEC FILE NUMBER: 005-46215) pursuant to the Act.

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SIGNATURE

     After reasonable inquiry and to the best of the knowledge and belief of the undersigned, the undersigned certifies that the information set forth in this statement is true and correct.

Date: September 5, 2003

Saratoga Lighting Holdings LLC

Saratoga Partners IV, L.P.

Saratoga Coinvestment IV LLC

Saratoga Management Company LLC

Saratoga Associates IV LLC

John P. Birkelund

Charles P. Durkin, Jr.

Christian L. Oberbeck

Signed on behalf of each of the above

By:	/s/ Richard A. Petrocelli
Name:	Richard A. Petrocelli
Title:	Treasurer

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SCHEDULE A

CERTAIN MEMBERS AND EXECUTIVE COMMITTEE
MEMBERS OF SARATOGA ASSOCIATES IV LLC

     The names of the Executive Committee Members of Saratoga Associates IV LLC (“Saratoga Associates”) and their principal occupations are set forth below. If no address is given, the Executive Committee Member’s business address is that of Saratoga Associates at 535 Madison Avenue, New York, New York 10022. Unless otherwise indicated, each occupation set forth opposite an individual’s name refers to Saratoga Associates and each individual is a United States citizen.

Name and Business Address	Present Position
John P. Birkelund	Member, Executive Committee Member*
Charles P. Durkin, Jr	Member, Executive Committee Member*
Christian L. Oberbeck	Member, Executive Committee Member*

     * Each of the above party’s principal occupation is Member and Executive Committee Member of Saratoga Management Company LLC.

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SCHEDULE B

MEMBERS AND EXECUTIVE COMMITTEE
MEMBERS OF SARATOGA MANAGEMENT COMPANY LLC

     The names of the Executive Committee Members of Saratoga Management Company LLC (“Saratoga Management”) and principal occupations are set forth below. If no address is given, the Executive Committee Member’s business address is that of Saratoga Associates at 535 Madison Avenue, New York, New York 10022. Unless otherwise indicated, each occupation set forth opposite an individual's name refers to Saratoga Management and each individual is a United States citizen.

Name and Business Address	Present Position
John P. Birkelund	Member, Executive Committee Member*
Charles P. Durkin, Jr	Member, Executive Committee Member*
Christian L. Oberbeck	Member, Executive Committee Member*

     * Each of the above party’s principal occupation is Member and Executive Committee Member of Saratoga Management Company LLC.

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EX-1

                                                                      EXHIBIT 1

                  JOINT FILING AGREEMENT AND POWER OF ATTORNEY

     In accordance with Rule 13d-1(k) under the Securities Exchange Act of
1934, as amended, each of the persons named below agrees to the joint filing of
a Statement on Schedule 13D (including amendments thereto) with respect to the
common stock, par value $0.001, of Advanced Lighting Technologies, Inc., an
Ohio corporation, and further agrees that this Joint Filing Agreement be
included as an exhibit to such filings provided that, as contemplated by
Section 13d-1(k)(l)(ii), no person shall be responsible for the completeness or
accuracy of the information concerning the other persons making the filing,
unless such person knows or has reason to believe that such information is
inaccurate. This Joint Filing may be executed in any number of counterparts,
all of which together shall constitute one and the same instrument.

     Each of Saratoga Lighting Holdings LLC, Saratoga Partners IV, L.P.,
Saratoga Coinvestment IV LLC, Saratoga Associates IV LLC, Saratoga Management
Company LLC, John P. Birkelund, Charles P. Durkin, Jr., and Christian L.
Oberbeck (the "Named Parties") hereby constitutes and appoints each of Richard
A. Petrocelli and Christian L. Oberbeck, acting singly, as the true and lawful
attorneys-in-fact, with full power of substitution in any and all capacities,
to execute for and on behalf of the Named Parties, the Schedule 13D to which
this Joint Filing Agreement and Power of Attorney is an exhibit and all
amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
the issuer and relevant stock exchanges. Each of the Named Parties hereby
grants to such attorneys-in-fact full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as the attorney-in-fact might or could, and hereby
ratifies and confirms all that said attorneys-in-fact or their substitute or
substitutes may lawfully do or cause to be done by virtue hereof.





     The undersigned acknowledges that the foregoing attorneys-in-fact, in
serving in such capacity at the request of the undersigned, are not assuming
any of the undersigned's responsibilities to comply with Section 13(d) of the
Securities Exchange Act of 1934.

     The powers hereby conferred upon the said attorneys-in-fact shall continue
in force until notice of the revocation of this Power of Attorney has been
received by the said attorneys-in-fact.

     Date: September 5, 2003

                                            Saratoga Lighting Holdings LLC

                                            By Saratoga Management Company LLC,
                                               as Managing Member

                                            By: /s/ Christian L. Oberbeck
                                               ---------------------------------
                                            Name:  Christian L. Oberbeck
                                            Title: Executive Committee Member

     Date: September 5, 2003

                                            Saratoga Partners IV, L.P.

                                            By Saratoga Associates IV LLC, as
                                               General Partner

                                            By Saratoga Management Company LLC,
                                               as Manager

                                            By: /s/ Christian L. Oberbeck
                                               ---------------------------------
                                            Name:  Christian L. Oberbeck
                                            Title: Executive Committee Member

     Date: September 5, 2003

                                            Saratoga Coinvestment IV LLC

                                            By Saratoga Management Company LLC,
                                               as Managing Member

                                            By: /s/ Christian L. Oberbeck
                                               ---------------------------------
                                            Name:  Christian L. Oberbeck
                                            Title: Executive Committee Member





     Date: September 5, 2003

                                            Saratoga Associates IV LLC

                                            By Saratoga Management Company LLC,
                                               as Manager

                                            By: /s/ Christian L. Oberbeck
                                               ---------------------------------
                                            Name:  Christian L. Oberbeck
                                            Title: Executive Committee Member

     Date: September 5, 2003

                                            Saratoga Management Company LLC

                                            By: /s/ Christian L. Oberbeck
                                               ---------------------------------
                                            Name:  Christian L. Oberbeck
                                            Title: Executive Committee Member

     Date: September 5, 2003
                                                            *
                                            ------------------------------------
                                                   John P. Birkelund

     Date: September 5, 2003

                                                /s/ Charles P. Durkin, Jr.
                                            ------------------------------------

     Date: September 5, 2003

                                                /s/ Christian L. Oberbeck
                                            ------------------------------------
- ---------
     *Mr. Birkelund's signature will be filed by amendment promptly.

EX-2

                                                                      EXHIBIT 2


                            STOCK PURCHASE AGREEMENT

                                  dated as of
                                August 15, 2003

                                    between

                        SARATOGA LIGHTING HOLDINGS LLC,


                                      and

                            GENERAL ELECTRIC COMPANY

                   acting through its GE CONSUMER PRODUCTS business component

                       relating to the purchase and sale

                                       of

                 Common Stock, Preferred Stock and Other Rights

                                       of

                      ADVANCED LIGHTING TECHNOLOGIES, INC.





                            STOCK PURCHASE AGREEMENT

     AGREEMENT dated as of August 15, 2003 by and between SARATOGA LIGHTING
HOLDINGS LLC, ("Buyer") and GENERAL ELECTRIC COMPANY, acting through its GE
CONSUMER PRODUCTS business component ("Seller").

                              W I T N E S S E T H:

     WHEREAS, Seller is the record and beneficial owner of the Securities (as
defined below) and the rights under the Assigned Agreements (as defined below)
and desires to sell the Securities and the rights under the Assigned Agreements
to Buyer, and Buyer desires to purchase the Securities and the rights under the
Assigned Agreements from Seller, upon the terms and subject to the obtaining of
required approvals, if any, and court orders required, if any, all as
hereinafter set forth;

     The parties hereto agree as follows:

                                   ARTICLE 1
                                  DEFINITIONS

     Section 1.01. Definitions. (a) The following terms, as used herein, have
the following meanings:

     "Affiliate" means, with respect to any Person, any other Person directly
or indirectly controlling, controlled by, or under common control with such
Person; provided that neither the Company nor any subsidiary of the Company
shall be considered an Affiliate of Seller.

     "Assigned Agreements" means (i) the Contingent Warrant Agreement, (ii) the
Registration Rights Agreement dated as of September 30, 1999 (as subsequently
amended) by and between the Company and the Seller, (iii) the Right of First
Refusal and Co-Sale Agreement dated as of September 30, 1999 (as subsequently
amended) by and among the Seller and the other parties listed on the signature
pages thereto, (iv) the Options, (v) the Stock Purchase Agreement, and (vi) the
Irrevocable Proxies granted to Seller and dated October 6, 1999.

     "Bankruptcy Court" means the United States Bankruptcy Court for the
Northern District of Illinois, Eastern Division.

     "Business Day" means a day, other than Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by law
to close.





     "Common Stock" means the common stock, par value $.001 per share, of the
Company.

     "Company" means ADVANCED LIGHTING TECHNOLOGIES, INC.

     "Contingent Warrant Agreement" means the Contingent Warrant Agreement
dated as of September 30, 1999 (as subsequently amended) by and among the
Company, the Seller and the other parties identified on the signature pages
thereto.

     "Lien" means, with respect to any property or asset, any mortgage, lien,
pledge, charge, security interest, encumbrance or other adverse claim of any
kind in respect of such property or asset. For the purposes of this Agreement,
a Person shall be deemed to own subject to a Lien any property or 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 property or asset.

     "Options" means the Option Agreement dated as of September 30, 1999 (as
subsequently amended) by and among Seller and the other parties listed on the
signature pages thereto and the options issued and issuable thereunder.

     "Person" means an individual, corporation, partnership, limited liability
company, association, trust, estate or other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof.

     "Preferred Stock" means the Series A Preferred Stock, par value $.001 per
share, of the Company.

     "Stock Purchase Agreement" means the Stock Purchase Agreement dated as of
September 28, 1999 (as subsequently amended) by and between Seller and the
Company.

     "Proxies" means the Irrevocable Proxies referred to in the definition of
Assigned Agreements.


                                       2



     (b) Each of the following terms is defined in the Section set forth
opposite such term:

                 Term                                      Section
                 ----                                      -------
                 Buyer                                     Recitals
                 Company                                   Recitals
                 Effective Time                              2.01
                 Package                                     3.05
                 Purchase Price                              2.01
                 Securities                                  3.05
                 Seller                                    Recitals
                 Warrant Rights                              3.05

                                   ARTICLE 2
                               PURCHASE AND SALE

     Section 2.01. Purchase and Sale. Upon the terms of this Agreement and
effective upon the execution of this Agreement by Seller and Buyer ("Effective
Time"), Seller hereby sells to Buyer, and Buyer hereby buys from Seller, the
Securities. The purchase price for the Securities (the "Purchase Price") is
$12,000,000 in cash. The sale transaction shall be deemed to have occurred and
be effective at the Effective Time, irrespective of when the payment of the
Purchase Price and the delivery of certificates for the Securities shall have
been completed. The Purchase Price shall be paid as provided in Section
2.02(a). The delivery of certificates for the Securities shall be as provided
for in Section 2.02(b).

     Section 2.02. (a) Payment of Purchase Price. Promptly after the Effective
Time, Buyer shall deliver to Seller $12,000,000 in immediately available funds
by wire transfer (or other equivalent means, satisfactory to Seller) to Bankers
Trust (a/k/a Deutsche Bank); New York, N.Y - ABA No. 021001033; Account Name:
GE Company; Account No.: 50000770; Reference: GE Lighting; and

     (b) Delivery of Certificates for the Securities. Promptly after receipt of
the funds transfer referred to in Section 2.02(a), Seller shall deliver to
Buyer, at its address set forth in Section 7.01, certificates for the
Securities together with all other necessary endorsements and signature
guarantees and other evidence and documents, in form and substance sufficient
to trigger the Company's duty to register transfer of the Securities to Buyer
under ss.8-401 of the applicable Uniform Commercial Code.

     (c) Transfer Tax. Buyer will be responsible for transfer taxes, if any.


                                       3



                                   ARTICLE 3
                    REPRESENTATIONS AND WARRANTIES OF SELLER

     Seller represents and warrants to Buyer as of the date hereof that:

     Section 3.01. Corporate Existence and Power. Seller is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation.

     Section 3.02. Corporate Authorization. The execution, delivery and
performance by Seller of this Agreement and the consummation of the
transactions contemplated hereby are within Seller's corporate powers and have
been duly authorized by all necessary corporate action on the part of Seller.
This Agreement constitutes a valid and binding agreement of Seller.

     Section 3.03. Governmental Authorization. The execution, delivery and
performance by Seller of this Agreement and the consummation of the
transactions contemplated hereby require no action by or in respect of, or
filing with, any governmental body, agency or official.

     Section 3.04. Noncontravention. The execution, delivery and performance by
Seller of this Agreement and the consummation of the transactions contemplated
hereby do not and will not (i) violate the certificate of incorporation or
bylaws of Seller, (ii) assuming compliance with the matters referred to in
Section 3.03, violate any applicable law, rule, regulation, judgment,
injunction, order or decree, or (iii) except for required consents of the
Company, if any, and approvals of the Bankruptcy Court, if any, regarding
transfer of Seller's rights under the Contingent Warrant Agreement, the Options
and the Stock Purchase Agreement, require any consent or other action by any
Person under, constitute a default under, or give rise to any right of
termination, cancellation or acceleration of any right or obligation of Seller
under any provision of any agreement or other instrument binding upon Seller.

     Section 3.05. Ownership Of Securities and Rights to Contingent Warrants,
etc. (a) Seller owns (i) 1,429,590 shares of Common Stock and (ii) 761,250
shares of Preferred Stock (the "Securities"). The Securities are the only
issued and outstanding equity securities of the Company held by Seller,
directly or indirectly. In addition, Seller owns the right to receive warrants
for that number of shares of Common Stock specified in the Contingent Warrant
Agreement ("Warrant Rights"), with respect to which an application for
authority for issuance, filed by the Company, is pending before the Bankruptcy
Court. Seller also owns the rights existing under the Proxies and the Options.
The Securities, the Warrant Rights, the Options and the Proxies are herein
collectively called the "Package."


                                       4



     (b) Seller is the record and beneficial owner of the Package, free and
clear of any Lien and any other limitation or restriction (including any
restriction on the right to vote, sell or otherwise dispose of the Securities),
except as the consent of the Company and the approval of the Bankruptcy Court
may be required for transfer of the Warrant Rights and the Options. Upon
receipt of funds as provided for in Section 2.02(a), Seller will transfer and
deliver to Buyer as provided in Section 2.02 (b) valid title to the Securities
free and clear of any Lien and any such limitation or restriction. Upon the
delivery by the Company of the consent of the Company and the obtaining by the
Company of such approval of the Bankruptcy Court, if any, as may be required
for transfer of the Warrant Rights and the Options, Seller will take all
reasonable and necessary steps to deliver the same so that they may be
effectively held and exercised by Buyer the same as if they were delivered at
the Effective Time on the assumption that no consents and approvals were ever
called for.

     Section 3.06. Other Agreements. Other than the Assigned Agreements, there
are no agreements, written or oral, among or on behalf of, on the one hand, any
of the Company and/or the shareholders of the Company and, on the other hand,
the Seller or any of its Affiliates that relate, directly or indirectly, to
Seller's rights and obligations with respect to the Securities.

                                   ARTICLE 4
                    REPRESENTATIONS AND WARRANTIES OF BUYER

     Buyer represents and warrants to Seller as of the date hereof:

     Section 4.01. Entity Existence and Power. Buyer is a limited liability
company duly formed, validly existing and in good standing under the laws of
its jurisdiction of formation.

     Section 4.02. Entity Authorization. The execution, delivery and
performance by Buyer of this Agreement and the consummation of the transactions
contemplated hereby are within the powers of Buyer and have been duly
authorized by all necessary action on the part of Buyer. This Agreement
constitutes a valid and binding agreement of Buyer.

     Section 4.03. Governmental Authorization. The execution, delivery and
performance by Buyer of this Agreement and the consummation of the transactions
contemplated hereby require no material action by or in respect of, or filing
with, any governmental body, agency or official.

     Section 4.04. Noncontravention. The execution, delivery and performance by
Buyer of this Agreement and the consummation of the


                                       5



transactions contemplated hereby do not and will not (i) violate the
organization documents of Buyer or (ii) subject, with respect to the Warrant
Rights and the Options to obtaining such consents of the Company, if any, and
approvals of the Bankruptcy Court, if any, as may be required, (a) violate any
applicable material law, rule, regulation, judgment, injunction, order or
decree or (b) require any consent or other action by any Person under,
constitute a default under, or give rise to any right of termination,
cancellation or acceleration of any right or obligation of Buyer under any
provision of any agreement or other instrument binding upon Buyer.

     Section 4.05. Purchase for Investment. Buyer is purchasing the Securities,
the Options and the Warrant Rights for investment for its own account and not
with a view to, or for sale in connection with, any distribution thereof. Buyer
(either alone or together with its advisors) has sufficient knowledge and
experience in financial and business matters so as to be capable of evaluating
the merits and risks of its investment in the Securities and is capable of
bearing the economic risks of such investment.

                                   ARTICLE 5
                              COVENANTS OF SELLER

     Seller agrees that:

     Section 5.01. Confidentiality. Subject to Section 7.02, Seller and its
Affiliates will hold, and will use commercially reasonable efforts to cause
their respective officers, directors, employees, accountants, counsel,
consultants, advisors and agents to hold, in confidence, unless compelled to
disclose by judicial or administrative process or by other requirements of law,
all confidential documents and information concerning the Company provided by
the Company in the negotiation of this Agreement, except to the extent that
such information can be shown to have been (i) previously known on a
nonconfidential basis by Seller, (ii) in the public domain through no fault of
Seller or its Affiliates or (iii) later lawfully acquired by Seller from
sources other than those related to its prior ownership of the Company.

     Section 5.02. Resignations. Promptly after the Effective Time, Seller will
deliver to Buyer the resignations of each of the persons it nominated to be
directors of the Company from the board of directors of the Company.

     Section 5.03. Lost Certificates. Seller agrees that, in the event it is
unable to locate any certificate representing ownership of any of the
Securities, it will deliver to the Company evidence satisfactory to the Company
(in the exercise of its reasonable discretion) of the loss, theft or
destruction of such certificate and of


                                       6



reasonably satisfactory indemnification, all to the extent required by ss.8-405
of the applicable Uniform Commercial Code. If for any reason Buyer fails to
receive shipment from Seller of the certificates for the Securities and the
related endorsements, it will be Seller's responsibility to see that they are
found and delivered or replaced, all at Seller's expense with no cost to Buyer.

                                   ARTICLE 6
                         COVENANTS OF BUYER AND SELLER

     Buyer and Seller agree that:

     Section 6.01. Best Efforts; Further Assurances. Subject to the other terms
and conditions of this Agreement, Buyer and Seller will use commercially
reasonable efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary or desirable under applicable laws and
regulations to consummate the transactions contemplated by this Agreement.

     Section 6.02. Public Announcements. The parties agree to consult with each
other before issuing any press release or making any public statement with
respect to this Agreement or the transactions contemplated hereby and, except
for any press releases and public statements the making of which may be
required by applicable law or any listing agreement with any national
securities exchange, will not issue any such press release or make any such
public statement prior to such consultation.

     Section 6.03. Assignment; No Assumption. As an additional benefit to Buyer
in exchange for Buyer's payment for the Securities, Seller hereby transfers and
assigns to Buyer all right, title and interest of Seller (a) to purchase, or
receive, additional equity interests of any description of the Company in
existence on the date of this Agreement and (ii) under the Assigned Agreements,
subject in the case of the transfer and assignment of the Warrant Rights and
the Options, to required consents of the Company, if any, and to required
approvals of the Bankruptcy Court, if any. Should any such consents and
approvals be required, Buyer concedes that it is the responsibility of the
Company to obtain them, not the responsibility of Seller. Accordingly, Seller
will have no liability to Buyer if the same are not obtained and, if the same
are not obtained, Seller will have no duty to deliver or perform with respect
to the foregoing assignments of the Warrant Rights or the Options or both, as
the case may be except that at all times until such required consents and
approvals, if any, are obtained, Seller will not vote or consent under the
Proxies, except as directed by Buyer. The parties acknowledge and agree that
Buyer and its Affiliates assume no liabilities of Seller, whether to the
Company or any one or more of its Affiliates or to anyone else, and that Buyer
shall not be responsible for any such liabilities. Seller hereby
unconditionally


                                       7



indemnifies, and agrees to defend and hold harmless, Buyer and its Affiliates
from and against any such liabilities, except to the extent caused by Buyer's
actions or omissions as owner or purchaser of the Securities or assignee of the
Assigned Agreements.

     Section 6.04. Further Assignments. Seller agrees that, in the event there
are agreements, written or oral, among or on behalf of, on the one hand, any of
the Company and/or the shareholders of the Company and, on the other hand,
Seller or any of its Affiliates that relate, directly or indirectly, to
Seller's rights and obligations with respect to the Securities and that have
not been assigned to Buyer pursuant to Section 6.03, Seller shall, if directed
by Buyer in its sole and absolute discretion, assign to Buyer all right, title
and interest of Seller under such agreements, subject to the Company (and not
Seller) obtaining all necessary consents, if any, of third parties and court
approvals, if any. The parties shall acknowledge and agree, in connection
therewith, that Buyer and its Affiliates will assume no liabilities of Seller,
whether to the Company or any one or more of its Affiliates or to anyone else,
and that Buyer shall not be responsible for any such liabilities. Also in
connection therewith, Seller will unconditionally indemnify, and agree to
defend and hold harmless, Buyer and its Affiliates from and against any such
liabilities, except to the extent caused by Buyer's actions or omissions as
owner or purchaser of the Securities or assignee of such assigned agreements.

     Section 6.05. Purchase, License And Consignment Agreement. Buyer shall use
its commercially reasonable efforts to have the Company and APL Engineered
Materials assume in the bankruptcy proceedings of the Company now pending in
the Bankruptcy Court, the following agreements: the (i) Lamp Materials Purchase
Agreement entered into as of September 30, 1999, between General Electric
Company, acting through its GE Lighting business, and APL Engineered Materials,
Inc. and Advanced Lighting Technologies, Inc., (ii) the Know How and Patent
License and Technical Assistance Agreement dated as of September 30, 1999,
between APL Engineered Materials, Inc., Advanced Lighting Technologies, Inc.
and General Electric Company, acting through its GE Lighting business, and
(iii) the Consignment Agreement entered into as of January 4, 1999, between APL
Engineered Materials, Inc. and GE Lighting ("Consignment Agreement").

     Section 6.06. Seller's Waiver and Substitution of Language for Section 13
of Lamp Materials Purchase Agreement Entered Into as of September 30, 1999.
Effective automatically at any time that the Company shall have confirmed a
chapter 11 plan of reorganization and the same shall have become effective, and
Buyer and/or any one or more of its Affiliates shall have the right, directly
or indirectly, to elect a majority of the members of the board of directors of
the Company and any one or more of its successors, Seller hereby waives
compliance by the Company with Section 13 of the Lamp Materials Purchase
Agreement


                                       8



entered into as of September 30, 1999, if but only if the Company, in lieu of
compliance with said Section 13, complies with the substituted provisions set
forth on the annexed Schedule A, the same as if the language on Schedule A had
been added to the agreement by amendment.

     Section 6.07. Buyer Commitment to Rebate Program. If at any time the
Company shall have confirmed a chapter 11 plan of reorganization and the same
shall have become effective, and Buyer and/or any one or more of its Affiliates
shall have the right, directly or indirectly, to elect a majority of the
members of the board of directors of the Company or any one or more of its
successors, then promptly thereafter Buyer shall cause the Company to offer
Seller (and keep such offer open for at least 30 days), the rebate program
described on the annexed Schedule B. If the Company shall fail to offer Seller
said rebate program, conforming in all material respects with the program in
Schedule B, then Buyer shall be liable to Seller for $3,000,000 which Buyer and
Seller agree is a reasonable estimate of the actual damage Seller would suffer
if the rebate program is not offered.

     Section 6.08. Buyer Commitment to Seller Regarding Trade Payables. Buyer
shall use its reasonable commercial efforts to ensure that the Company's trade
payables to Seller are handled in accordance with Schedule C, which shall be
incorporated into the Company's plan of reorganization to be submitted and
approval of which will be sought from the Bankruptcy Court.

                                   ARTICLE 7
                                 MISCELLANEOUS

     Section 7.01. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile transmission) and
shall be given,

     if to Buyer, to:

          Saratoga Lighting Holdings LLC
          535 Madison Avenue
          New York, New York 10022
          Attention:  Damon Ball
          Facsimile No:  (212) 750-3343

     with a copy to:


                                       9



          Davis Polk & Wardwell
          450 Lexington Avenue
          New York, New York  10017
          Attention: Stephen H. Case
          Facsimile No.: (212) 450-3800

     if to Seller, to:

          General Electric Company
          Appliance Park, AP35-1119
          Louisville, Kentucky 40225
          Attention:  Steven J. Sedita
          Facsimile No.: (502) 452-0107

     with a copy to:

          General Counsel
          GE Consumer Products
          Appliance Park, AP2-225
          Louisville, Kentucky 40225
          Attention: Raymond M. Burse
          Facsimile No.: (502) 452-0347

or such other address or facsimile number as such party may hereafter specify
for the purpose by notice to the other parties hereto. All such notices,
requests and other communications shall be deemed received on the date of
receipt by the recipient thereof if received prior to 5:00 p.m. in the place of
receipt and such day is a Business Day in the place of receipt. Otherwise, any
such notice, request or communication shall be deemed not to have been received
until the next succeeding Business Day in the place of receipt.

     Section 7.02. Limited Disclosure Authorization. Notwithstanding any other
provision of this Agreement, each of Buyer and Seller is permitted to disclose
the tax treatment and tax structure of the transactions contemplated hereby
(including any materials, opinions or analyses relating to such tax treatment
or tax structure, but without disclosure of identifying information or, except
to the extent relating to such tax structure or tax treatment, any nonpublic
commercial or financial information). Moreover, notwithstanding any other
provision of this Agreement, there shall be no limitation on Buyer's and
Seller's ability to consult any tax adviser, whether or not independent from
Buyer, Seller or their Affiliates, regarding the tax treatment or tax structure
of the transactions contemplated hereby.

     Section 7.03. Survival. The representations and warranties of the parties
hereto contained in this Agreement shall survive the Effective Time
indefinitely.


                                      10



     Section 7.04. Amendments and Waivers. (a) Any provision of this Agreement
may be amended or waived if, but only if, such amendment or waiver is in
writing and is signed, in the case of an amendment, by each party to this
Agreement, or in the case of a waiver, by the party against whom the waiver is
to be effective.

     (b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.

     Section 7.05. Expenses. Except as otherwise provided herein, all costs and
expenses incurred in connection with this Agreement shall be paid by the party
incurring such cost or expense.

     Section 7.06. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of each other party hereto; except that (i) Buyer may
transfer or assign, in whole or from time to time in part, to one or more of
its Affiliates, the right to purchase all or a portion of the Securities, but
no such transfer or assignment will relieve Buyer of its obligations hereunder
and (ii) Seller may transfer or assign any of its rights or obligations to any
Affiliate of Seller.

     Section 7.07. Governing Law. This Agreement shall be governed by and
construed in accordance with the law of the State of New York, without regard
to the conflicts of law rules of such state.

     Section 7.08. Jurisdiction. The parties hereto agree that any suit, action
or proceeding seeking to enforce any provision of, or based on any matter
arising out of or in connection with, this Agreement or the transactions
contemplated hereby shall be brought in the United States District Court for
the Southern District of New York or any New York State court sitting in New
York City, so long as one of such courts shall have subject matter jurisdiction
over such suit, action or proceeding, and that any cause of action arising out
of this Agreement shall be deemed to have arisen from a transaction of business
in the State of New York, and each of the parties hereby irrevocably consents
to the jurisdiction of such courts (and of the appropriate appellate courts
therefrom) in any such suit, action or proceeding and irrevocably waives, to
the fullest extent permitted by law, any objection that it may now or hereafter
have to the laying of the venue of any such suit, action or proceeding in any
such court or that any such suit, action or proceeding brought in any such
court has been brought in an inconvenient


                                      11



forum. Process in any such suit, action or proceeding may be served on any
party anywhere in the world, whether within or without the jurisdiction of any
such court. Without limiting the foregoing, each party agrees that service of
process on such party as provided in Section 7.01 shall be deemed effective
service of process on such party.

     Section 7.09. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

     Section 7.10. Counterparts; Effectiveness; Third Party Beneficiaries. This
Agreement may be signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument. This Agreement shall become effective when each party
hereto shall have received a counterpart hereof signed by all of the other
parties hereto. No provision of this Agreement is intended to confer any
rights, benefits, remedies, obligations, or liabilities hereunder upon any
Person other than the parties hereto and their respective successors and
assigns.

     Section 7.11. Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter of this
Agreement and supersedes all prior agreements and understandings, both oral and
written, between the parties with respect to the subject matter of this
Agreement.

     Section 7.12. Captions. The captions herein are included for convenience
of reference only and shall be ignored in the construction or interpretation
hereof.

     Section 7.13. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon such
a determination, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated
hereby be consummated as originally contemplated to the fullest extent
possible.

     Section 7.14. Specific Performance. The parties hereto agree that
irreparable damage would occur if any provision of this Agreement were not
performed in accordance with the terms hereof and that the parties shall be


                                      12



entitled to an injunction or injunctions to prevent breaches of this Agreement
or to enforce specifically the performance of the terms and provisions hereof,
in addition to any other remedy to which they are entitled at law or in equity.


                                      13



     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.

                                           SARATOGA LIGHTING HOLDINGS LLC


                                           By: Saratoga Partners IV, L.P.,
                                               its sole member


                                           By: Saratoga Management Company LLC


                                           By: /s/ Christian L. Oberbeck
                                              ----------------------------------
                                              Name:  Christian L. Oberbeck
                                              Title:


                                           GENERAL ELECTRIC COMPANY,
                                                GE Consumer Products

                                           By: /s/ Steven Sedita
                                              ----------------------------------
                                              Name:  Steven Sedita
                                              Title: CFO & VP Finance



                     Schedule A to Stock Purchase Agreement

 Substituted Language for Section 13 of Lamp Materials Purchase Agreement
entered into as of September 30, 1999

(a) In the event that ADLT desires to sell all or substantially all of Seller
(whether as an asset, stock transfer, or otherwise) to a third party lighting
products competitor of Purchaser (a "Sale") then, in addition to the rights
specified in Section 12, ADLT shall give notice (an "Offer Notice") to
Purchaser that ADLT desires to engage in such a Sale. The Offer Notice shall
identify (i) whether ADLT is proposing to sell assets in addition to that of
Seller as part of the Sale, (ii) the price (the "Offer Price") that ADLT
proposes to be paid for all of the assets being sold, including Seller (the
"Offered Assets") and (iii) any other material terms sought by ADLT.

(b) The giving of an Offer Notice shall constitute an offer (the "Offer") by
ADLT to sell the Offered Assets to Purchaser for cash at the Offer Price and on
the other terms set forth in the Offer Notice. The Purchaser shall have a
60-day period (the "Offer Period") in which to accept such Offer by giving a
notice of acceptance to ADLT prior to the expiration of such Offer Period. If
the Purchaser fails to notify ADLT prior to the expiration of the Offer Period,
the Purchaser shall be deemed to have declined such Offer.

(c) If the Purchaser elects to purchase the Offered Assets, the Purchaser shall
purchase and pay, by bank or certified check (in immediately available funds),
the Offer Price within 20 business days after the date on which the Offer was
accepted; provided that, if the transaction is subject to any prior regulatory
approval, the time period during which such transaction may be consummated
shall be extended until the expiration of five business days after all such
approvals shall have been received, but in no event shall such period be
extended for more than an additional 60 days.

(d) Upon the earlier to occur of i) rejection of the Offer by the Purchaser,
ii) the expiration of the Offer Period without the Purchaser electing to
purchase all of the Offered Assets and the failure to obtain any required
consent or regulatory approval for the transaction within 60 days of full
acceptance of the Offer, ADLT shall have a one year period during which to
effect a Sale of the Offered Assets on the same in all respects material to
Purchaser or more favorable (as to ADLT) terms and conditions as were set forth
in the Offer Notice at a price not less than the Offer Price; provided that, if
such Sale is subject to regulatory approval, such one year period shall be
extended until the expiration of five business days after all such approvals
shall have been received.

(e) If ADLT does not consummate a Sale of the Offered Assets in accordance with
the foregoing time limitations, then the right of ADLT to effect such a Sale


pursuant to this Section 13(d) shall terminate and ADLT shall again comply with
the procedures set forth in this Section 13 with respect to any proposed Sale
of the Offered Assets.


                                       2



                     Schedule B to Stock Purchase Agreement

         On or promptly after the Effective Date, the Reorganized Debtors shall
offer to General Electric Company and its subsidiaries and other affiliates
(collectively herein, "GE") (and keep such offer open for at least 30 days) an
incremental sales incentive plan, pursuant to which GE could earn a 10% rebate
(up to a maximum of $13 million in the aggregate) on future purchases from the
Reorganized Debtors and its affiliates, excluding APL. To earn its rebate, GE
must make annual purchases (in the aggregate not to exceed $130 million) from
the Reorganized Debtors and their affiliates, excluding APL, in excess of the
aggregate purchases GE made from the Debtors, including its nondebtor
affiliates, but excluding APL, in ADLT's 2003 fiscal year. In no event shall
there be any rebate in any year on the amount of purchases equaling the total
purchases by GE from the Debtors, including its affiliates and subsidiaries,
but excluding APL, in ADLT's 2003 fiscal year.




                     Schedule C to Stock Purchase Agreement

         Section 3.06. (b) Claims: Secured Claims of GE. The Class 1(b) GE
Secured Claims shall receive nothing on the Effective Date, provided, however,
on the Effective Date, or as soon thereafter as the GE Secured Claims are
Allowed, GE may offset from the amounts owing by GE to the Debtors, including
the Debtors' nondebtor affiliates, and indefeasibly retain for GE's own
account, an amount up to, but not in excess of, the Allowed Amount of the GE
Secured Claims. If, after giving effect to the offset provided in this Section
3.06(b), GE has any remaining Claims against the Debtors, such Claims of GE
shall be treated as Class 5 Subsidiary Debtors General Unsecured Claims. Except
to the extent of the offset permitted under this Section 3.06(b), nothing in
this Section 3.06(b) shall be or be deemed to be a waiver or release of any
claim belonging to the Debtors or their nondebtor affiliates against GE.

EX-3

                                                                      EXHIBIT 3

                         UNITED STATES BANKRUPTCY COURT
                          NORTHERN DISTRICT OF ILLINOIS
                                EASTERN DIVISION


In re:                                    )     Chapter 11
                                          )
VENTURE LIGHTING                          )     Case No. 03 B 05255
INTERNATIONAL, INC., et al.,              )     (Jointly Administered)
                                          )
                                 Debtors. )     Honorable A. Benjamin Goldgar



                                NOTICE OF FILING

TO:      SEE ATTACHED SERVICE LIST

         PLEASE TAKE NOTICE that on the 29th day of August, 2003, the
undersigned filed the attached Disclosure Statement with Respect to First
Amended Chapter 11 Plan of Reorganization dated August 15, 2003, with the Clerk
of the United States Bankruptcy Court for the Northern District of Illinois,
Eastern Division, a copy of which is attached hereto and is hereby served upon
you.

                             CERTIFICATE OF SERVICE

         I, Jerry L. Switzer, Jr., certify that I caused the Disclosure
Statement with Respect to First Amended Chapter 11 Plan of Reorganization dated
August 15, 2003 to be served upon the parties on the attached Service List via
Federal Express or Messenger delivery (as indicated thereon) on the 29th day of
August, 2003.



                                                     ---------------------------
                                                         Jerry L. Switzer, Jr.


Jeff J. Marwil (06194504)
Jerry L. Switzer, Jr. (06210229)
Peter J. Young (06278765)
JENNER & BLOCK, LLC
One IBM Plaza
Chicago, Illinois 60611
(312) 222-9350
(312) 527-0484 (Fax)






               In re: Venture Lighting International, Inc., et al.
                               Case No. 03 B 05255

                                  SERVICE LIST
                                  ------------


Ira Bodenstein                                Securities and Exchange Commission
United States Trustee (Region 11)             Attn:  Angela D. Dodd
Attn:  Roman Sukley                           175 West Jackson Boulevard
227 West Monroe Street                        Suite 900
Suite 3350                                    Chicago, IL 60604
Chicago, IL 60606                             facsimile:  (312) 353-7398
facsimile:  312-886-5794

Robert Fishman                                Stroock & Stroock & Lavan LLP
Shaw, Gussis, Fishman, Glantz & Wolfson, LLC  Attn:  Michael J. Sage
1144 North Fulton Street                             Kris Hansen
Suite 200                                            Victor Glaser
Chicago, IL 60607                             180 Maiden Lane
facsimile:  312-541-0155                      New York, NY  10038
                                              facsimile:  212-806-6006

Michael B. Solow
Joel L. Miller
Kaye Scholer LLC
Three First National Plaza
70 West Madison Street
Suite 4100
Chicago, IL 60602
facsimile:  312-583-2360




                         UNITED STATES BANKRUPTCY COURT
                          NORTHERN DISTRICT OF ILLINOIS
                                EASTERN DIVISION


In re:                                      )     Chapter 11
                                            )
VENTURE LIGHTING                            )     Case No.  03-05255
INTERNATIONAL, INC., et al.,                )     (Jointly Administered)
                                            )
                              Debtors.      )     Honorable A. Benjamin Goldgar


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




                              DISCLOSURE STATEMENT

                                 WITH RESPECT TO

                        FIRST AMENDED CHAPTER 11 PLAN OF
                      REORGANIZATION DATED AUGUST 15, 2003




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











                               SUMMARY TERM SHEET

     This Summary Term Sheet provides an overview of the Recapitalization which
the Debtors and Saratoga are attempting to accomplish through the Plan as
described in this Disclosure Statement. The Debtors and Saratoga are seeking
your consent to the Plan. The Plan reflects the terms under which the Debtors
and Saratoga believe the Debtors can reorganize for the benefit of all creditors
and equity security holders.

     For a complete description of the Plan and the Recapitalization, please see
the Sections entitled "COMPANY BACKGROUND AND PURPOSE OF THE RECAPITALIZATION"
and "THE PLAN" contained in this Disclosure Statement. In addition, you should
carefully read the Section entitled "RISK FACTORS." Capitalized terms not
defined herein have the meanings ascribed to such terms in the Plan attached
hereto as Annex A.1

     The Plan for which the Debtors and Saratoga are seeking your consent
involves the Recapitalization described below:

o    Class 1(a) Claims: Miscellaneous Secured Claims. The Debtors estimate that
     there are approximately 2 Miscellaneous Secured Claims in the approximate
     aggregate amount of $508,000. Class 1(a) Miscellaneous Secured Claims are
     Unimpaired. Each Holder of an Allowed Class 1(a) Miscellaneous Secured
     Claim shall receive, in the sole discretion of the Debtors or the
     Reorganized Debtors, as the case may be, in full satisfaction, settlement,
     release, extinguishment and discharge of such Claim: (A) Cash equal to the
     amount of such Allowed Miscellaneous Secured Claim on or as soon as
     practicable after the later of (i) the Effective Date, (ii) the date that
     such Miscellaneous Secured Claim becomes Allowed and (iii) a date agreed to
     by the Debtors or the Reorganized Debtors, as the case may be, and the
     Holder of such Claim; (B) treatment such that such Miscellaneous Secured
     Claim is Reinstated; or (C) such other treatment on such other terms and
     conditions as may be agreed upon in writing by the Holder of such Claim and
     the Debtors or the Reorganized Debtors, as the case may be, or as the
     Bankruptcy Court may order.

o    Class 1(b) Claims: Secured Claims of GE. The Debtors estimate that there
     are approximately 3 GE Secured Claims in the approximate aggregate amount
     of $2,390,000. Class 1(b) GE Secured Claims are Impaired. The Class 1(b) GE
     Secured Claims shall receive nothing on the Effective Date, provided,
     however, on the Effective Date, or as soon thereafter as the GE Secured
     Claims are Allowed, GE may offset from the amounts owing by GE to the
     Debtors, including

- --------
         1 The Plan attached hereto as Annex A is the version filed with the
Bankruptcy Court on August 15, 2003. Drafts of certain Plan exhibits are being
filed contemporaneously with this Disclosure Statement under a separate cover
and are incorporated herein by reference. No later than one week prior to the
deadline for the filing of objections to this Disclosure Statement (on or before
September 19, 2003), the Debtors and Saratoga intend to file an amended Plan and
amended Plan exhibits to conform to the Disclosure Statement.



     the Debtors' nondebtor affiliates, and indefeasibly retain for GE's own
     account, an amount up to, but not in excess of, the Allowed Amount of the
     GE Secured Claims. If, after giving effect to the offset provided in
     Section 3.06(b) of the Plan, GE has any remaining Claims against the
     Debtors, such Claims of GE shall be treated as Class 5 Subsidiary Debtor
     General Unsecured Claims. Except to the extent of the offset permitted
     under Section 3.06(b) of the Plan, nothing in Section 3.06(b) of the Plan
     shall be or be deemed to be a waiver or release of any claim belonging to
     the Debtors or their nondebtor affiliates against GE.

o    Class 2 Claims: Classified Priority Claims. The Debtors estimate that there
     are approximately 5 Classified Priority Claims in the approximate aggregate
     amount of $23,500. Class 2 Classified Priority Claims are Unimpaired. To
     the extent that these Claims have not already been paid pursuant to prior
     order of the Bankruptcy Court, each Holder of an Allowed Class 2 Classified
     Priority Claim shall receive in full satisfaction, settlement, release,
     extinguishment and discharge of such Claim: (A) the amount of such unpaid
     Allowed Claim in Cash on or as soon as reasonably practicable after the
     later of (i) the Effective Date, (ii) the date on which such Class 2 Claim
     becomes Allowed and (iii) a date agreed to by the Debtors or the
     Reorganized Debtors, as the case may be, and the Holder of such Class 2
     Claim; or (B) such other treatment on such other terms and conditions as
     may be agreed upon in writing by the Holder of such Claim and the Debtors
     or the Reorganized Debtors, as the case may be, or as the Bankruptcy Court
     may order.

o    Class 3 Claims: Old Note Claims. The Debtors estimate that there are
     approximately 70 Old Note Claims; the Old Indenture Trustee has filed a
     proof of claim on behalf of all Holders of Old Notes in the aggregate
     amount of $107,238,350.35. The Old Note Claims are Allowed as follows:

          (A) if Class 3 accepts the Plan pursuant to ss.1129(a)(8)(A) of the
     Bankruptcy Code, such Old Note Claims shall be Allowed in an aggregate
     amount equal to the sum of (i) $107,145,205 (being the sum of $100,000,000
     plus interest at 8% from March 16, 2002 to the Petition Date) plus (ii)
     interest on the amount mentioned in (A)(i) of section 3.08 of the Plan from
     the Petition Date to the Effective Date at the rate of 8% per annum, or

          (B) if Class 3 does not so accept the Plan, then such Old Note Claims
     shall be Allowed in an aggregate amount equal to (i) $107,145,205 (being
     the sum of $100,000,000 plus interest at 8% from March 16, 2002 to the
     Petition Date) plus (ii) interest on the amount mentioned in (B)(i) of
     section 3.08 of the Plan from the Petition Date to the Effective Date at
     that rate per annum which is the greater of:

               (1) 1.32% (such rate being (a) the weekly average 1-year constant
          maturity Treasury yield, as published by the Board of Governors of the
          Federal Reserve System for the week ending Friday January 31, 2003,
          the end of the calendar week preceding



          the Petition Date, and (b) specified as the interest rate allowed on
          judgments entered in federal courts pursuant to 28 U.S.C. ss.1961 and
          reported on the following site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt),

               (2) such other rate per annum as the Bankruptcy Court determines
          is legally required by the applicable provisions of the Bankruptcy
          Code for accruals of post-petition interest on unsecured debt.

          Class 3 Old Note Claims are Impaired. On or as soon as practicable
     after the Effective Date, each Holder of an Allowed Old Note Claim as of
     the Distribution Record Date shall receive from the Disbursing Agent, in
     full satisfaction, settlement, release, extinguishment and discharge of
     such Claim, a New Note in a principal amount equal to:

               (A) the unpaid principal amount of such Old Note held by such
          Holder plus

               (B) the amount of interest accrued but unpaid on such Old Note
          from March 16, 2002 to the Petition Date plus

               (C) interest on an amount equal to the sum of (A) and (B) in this
          sentence from the Petition Date to the Effective Date at the
          applicable rate as provided above in section 3.08 (A) or (B) of the
          Plan.

          Acceptance of the Plan by Class 3 shall, subject to consummation of
     the Plan, constitute a waiver by all Holders of Class 3 Old Note Claims of
     any and all defaults under the Old Indenture that may exist as of the
     Effective Date, and an agreement to instruct the Old Indenture Trustee to
     take all actions to effectuate the Plan.

o    Class 4 Claims: ADLT General Unsecured Claims. The Debtors estimate that
     there are approximately 43 ADLT General Unsecured Claims in the approximate
     aggregate amount of $2,076,000 (certain ADLT General Unsecured Claims that
     have already been paid pursuant to prior order of the Bankruptcy Court are
     not included in this amount). The Class 4 ADLT General Unsecured Claims are
     Impaired. Each Holder of Class 4 ADLT General Unsecured Claims shall be
     entitled to receive interest on the Allowed Amount of such Holder's claim
     from the Petition Date to the Effective Date at that rate per annum which
     is the greater of:

               (1) 1.32% (such rate being (a) the weekly average 1-year constant
          maturity Treasury yield, as published by the Board of Governors of the
          Federal Reserve System for the week ending Friday January 31, 2003,
          the end of the calendar week preceding the Petition Date, and (b)
          specified as the interest rate allowed on judgments entered in federal



          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

               (2) such other rate per annum as the Bankruptcy Court determines
          is legally required by the applicable provisions of the Bankruptcy
          Code for accruals of post-petition interest on unsecured debt.

          The Holder of each Class 4 ADLT General Unsecured Claim shall have an
     election to accept either "85% Now Treatment" or "100% Stretch Treatment,"
     as described in ensuing sentences in Section 3.09 of the Plan. Such
     election shall be exercised by each such Holder (including Holders of
     Disputed Class 4 Claims, whether or not the proceedings to determine the
     Allowed Amount of such Holder's Disputed Class 4 ADLT General Unsecured
     Claim shall have been concluded at the Effective Date), pursuant to
     election forms which will be mailed to each such Holder by Reorganized ADLT
     within five Cleveland, Ohio Business Days after the Effective Date, subject
     to the requirement that each Holder who fails to have made its election and
     to have caused its fully completed election form to have been actually
     received by the Reorganized Debtors by 5:00 p.m. Cleveland time on the 20th
     Cleveland, Ohio Business Day after the Effective Date shall be conclusively
     deemed to have elected 85% Now Treatment.

          Each Holder who shall have elected 85% Now Treatment (or who shall
     have been automatically deemed to have made such election) shall be
     entitled to receive on the later of:

               (1) 45 days after the Effective Date,

               (2) the date on which such Holder's Class 4 ADLT General
          Unsecured Claim shall have become Allowed,

               (3) the date on which such Class 4 ADLT General Unsecured Claim,
          or any portion thereof, shall be paid pursuant to the established
          ordinary course of business or dealings between ADLT and the Holder of
          such Claim, and

               (4) such other date agreed to by the Debtors or the Reorganized
          Debtors, as the case may be, and the Holder of such Class 4 ADLT
          General Unsecured Claim,

     an amount in Cash equal to 85% of the Allowed Amount of such Holder's Class
     4 ADLT General Unsecured Claim.

          Holders who shall have elected 100% Stretch Treatment shall be
     entitled to receive, starting on the later of:

               (1) the first Calendar-Quarter-End Date after the Effective Date,
          and



               (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 4 ADLT General Unsecured Claim shall have become
          Allowed, and on each of the next succeeding Calendar-Quarter-End Dates
          thereafter, until such Allowed Class 4 ADLT General Unsecured Claim is
          paid in full, an amount in Cash equal to 25% of the Allowed Amount of
          such Holder's Class 4 ADLT General Unsecured Claim, plus interest
          accrued on such portion of such Allowed Claim from the Effective Date
          through the date of such payment calculated at a rate (a) equal to the
          weekly average 1-year constant maturity Treasury yield, as published
          by the Board of Governors of the Federal Reserve System for the end of
          the calendar week in which the Effective Date occurs, and (b) as
          specified as the interest rate allowed on judgments entered in federal
          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 4
          ADLT General Unsecured Claim, except that Holders of Claims that shall
          have elected 100% Stretch Treatment remain Disputed Class 4 ADLT
          General Unsecured Claims on such 364th day shall be entitled to
          receive 100% of their Allowed Claim on the date of Allowance thereof.

          All payments to Holders of Class 4 ADLT General Unsecured Claims shall
     be made in Cash, unless otherwise agreed between Reorganized ADLT and the
     Holder of such Claim.

o    Class 5 Claims: Subsidiary Debtor General Unsecured Claims. The Debtors
     estimate that there are approximately 700 Subsidiary Debtor General
     Unsecured Claims in the approximate aggregate amount of $2,412,000 (certain
     Subsidiary Debtor General Unsecured Claims that have already been paid
     pursuant to prior order of the Bankruptcy Court are not included in this
     amount). The Class 5 Subsidiary Debtor General Unsecured Claims are
     Impaired. Each Holder of Class 5 Subsidiary Debtor General Unsecured Claims
     shall be entitled to receive interest on the Allowed Amount of such
     Holder's claim from the Petition Date to the Effective Date at that rate
     per annum which is the greater of:

               (1) 1.32% (such rate being (a) the weekly average 1-year constant
          maturity Treasury yield, as published by the Board of Governors of the
          Federal Reserve System for the week ending Friday January 31, 2003,
          the end of the calendar week preceding the Petition Date, and (b)
          specified as the interest rate allowed on judgments entered in federal
          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or


               (2) such other rate per annum as the Bankruptcy Court determines
          is legally required by the applicable provisions of the Bankruptcy
          Code for accruals of post-petition interest on unsecured debt.

          The Holder of each Class 5 Subsidiary Debtor General Unsecured Claim
     shall have an election to accept either "85% Now Treatment" or "100%
     Stretch Treatment," as described in ensuing sentences in section 3.10 of
     the Plan. Such election shall be exercised by each such Holder (including
     Holders of Disputed Claims, whether or not the proceedings to determine the
     Allowed Amount of such Holder's Disputed Class 5 Subsidiary Debtor General
     Unsecured Claim shall have been concluded at the Effective Date), pursuant
     to election forms which will be mailed to each such Holder by Reorganized
     ADLT within five Cleveland, Ohio Business Days after the Effective Date,
     subject to the requirement that each Holder who fails to have made its
     election and to have caused its fully completed election form to have been
     actually received by the Reorganized Debtors by 5:00 p.m. Cleveland time on
     the 20th Cleveland, Ohio Business Day after the Effective Date shall be
     conclusively deemed to have elected 85% Now Treatment.

          Each Holder who shall have elected 85% Now Treatment (or who shall
     have been automatically deemed to have made such election) shall be
     entitled to receive on the later of:

               (1) 45 days after the Effective Date,

               (2) the date on which such Holder's Class 5 Subsidiary Debtor
          General Unsecured Claim shall have become Allowed,

               (3) the date on which such Class 5 Subsidiary Debtor General
          Unsecured Claim, or any portion thereof, shall be paid pursuant to the
          established ordinary course of business or dealings between ADLT and
          the Holder of such Claim, and

               (4) such other date agreed to by the Debtors or the Reorganized
          Debtors, as the case may be, and the Holder of such Class 5 Subsidiary
          Debtor General Unsecured Claim,

     an amount in Cash equal to 85% of the Allowed Amount of such Holder's Class
     5 Subsidiary Debtor General Unsecured Claim.

          Holders who shall have elected 100% Stretch Treatment shall be
     entitled to receive, starting on the later of:

               (1) the first Calendar-Quarter-End Date after the Effective Date,
          and

               (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 5 Subsidiary Debtor General Unsecured Claim
          shall have become Allowed, and on each of the next succeeding
          Calendar-


          Quarter-End Dates thereafter, until such Allowed Class 5 Subsidiary
          Debtor General Unsecured Claim is paid in full, an amount in Cash
          equal to 25% of the Allowed Amount of such Holder's Class 5 Subsidiary
          Debtor General Unsecured Claim, plus interest accrued on such portion
          of such Allowed Claim from the Effective Date through the date of such
          payment calculated at a rate (a) equal to the weekly average 1-year
          constant maturity Treasury yield, as published by the Board of
          Governors of the Federal Reserve System for the end of the calendar
          week in which the Effective Date occurs, and (b) as specified as the
          interest rate allowed on judgments entered in federal courts pursuant
          to 28 U.S.C. ss.1961 and reported on the following site on the
          internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 5
          Subsidiary Debtor General Unsecured Claim, except that Holders of
          Claims that shall have elected 100% Stretch Treatment remain Disputed
          Class 5 Subsidiary Debtor General Unsecured Claims on such 364th day
          shall be entitled to receive 100% of their Allowed Claim on the date
          of Allowance thereof.

          All payments to Holders of Class 5 Subsidiary Debtor General Unsecured
     Claims shall be made in Cash, unless otherwise agreed between Reorganized
     ADLT and the Holder of such Claim.

o    Class 6 Interests: Old Preferred Stock Interests. Class 6 Preferred
     Interests are Impaired. There is 1 Holder of the Class 6 Preferred
     Interests: Saratoga holds Class 6 Interests in 761,250 Old Preferred
     Shares; such Interests of Saratoga are Allowed under the Plan. On or as
     soon as practicable after the Effective Date, Saratoga, the Holder of the
     Allowed Class 6 Preferred Interest as of the Distribution Record Date shall
     receive, in full satisfaction, settlement, release, extinguishment and
     discharge of such Preferred Interest, and upon payment in Cash to ADLT by
     wire transfer of immediately available funds, $18,000,000, 29,000 shares of
     New Preferred Stock and 1,000 shares of New Common Stock, such that the
     Holders of the Allowed Class 6 Preferred Interests shall have received 100%
     of the authorized shares of New Preferred Stock, all of which are to be
     outstanding on the Effective Date and held by Saratoga, 100% of the shares
     of New Common Stock issued and outstanding on the Effective Date and 90.8%
     of the Fully Diluted New Common Stock. Acceptance of the Plan by Class 6
     shall, subject to consummation of the Plan, constitute an approval, as
     recipient of New Common Stock, of the Management Incentive Plan and the
     Senior Management Contracts.

o    Class 7 Interests: Old Common Stock Interests. The Debtors estimate that
     there are approximately 6,000 Holders of Old Common Stock (23,807,347
     shares issued and outstanding). Class 7 Common Interests are Impaired. If
     Class 7 accepts the Plan pursuant toss.1129(a)(8) of the Bankruptcy Code
     then, on or as soon as practicable after the Effective Date, each Holder of
     an Allowed Class 7


     Interest as of the Distribution Record Date (and any Holders in Class 8,
     other than Saratoga, electing to exercise their rights as set forth in
     section 3.13 of the Plan) shall receive from the Disbursing Agent, in full
     satisfaction, settlement, release, extinguishment, cancellation and
     discharge of such Interest, for each share of Old Common Stock held by such
     Holder, the sum of $0.1197 (11.97 cents) per share (based on 23,807,347
     shares outstanding) payable such that the Holders of Class 7 Common
     Interests shall have received in the aggregate $2,850,000; provided,
     however, that the Cash distributions to be received by such Holders shall
     be reduced by the aggregate amount of Allowed Professional Claims of
     Professionals retained by or on behalf of the Equity Committee up to
     $350,000, such that, at a minimum, such Holders shall have received in the
     aggregate $2,500,000 (resulting in a Cash distribution of $0.105 (10.5
     cents) per share of Old Common Stock (based on 23,807,347 shares
     outstanding)). If Class 7 does not accept the Plan pursuant toss.1129(a)(8)
     of the Bankruptcy Code then they will be entitled to $2,500,000, pro rata,
     including Saratoga, payable in quarterly installments of 25% of the amount
     payable to such Holder starting, with respect to each Holder of a Class 7
     Interest, on the later of (i) the first Calendar-Quarter-End Date after the
     Effective Date and (ii) the Calendar-Quarter-End Date next following the
     date on which each such Old Common Stock Interest shall have become
     Allowed, and on each of the next succeeding Calendar-Quarter-End Dates
     thereafter, until such Allowed Old Common Stock Interest is paid in full
     the amount provided for in Section 3.12 of the Plan, subject to the proviso
     that on the 364th day after the Effective Date of the Plan, each such
     Holder shall receive the entire then-unpaid balance of the amount due under
     the Plan in respect of such Class 7 Interest, without interest. Regardless
     of the foregoing, Holders of Old Common Stock Interests that remain
     Disputed on such 364th day shall be entitled to receive 100% of the amount
     due on their Allowed Interest on the date of Allowance thereof. All
     payments to Holders of Class 7 Old Common Stock Interests shall be made in
     Cash unless otherwise agreed between Reorganized ADLT and the Holder of
     such Interest. No interest will accrue or be payable on Class 7 Old Common
     Stock Interests or the payments made to Holders thereof.

o    Class 8 Interests: Old Other Interests. The Debtors estimate that there are
     approximately 830 Holders of Old Other Interests. Class 8 Interests are
     Impaired. Each Holder of an Old Other Interest shall have the right to
     exercise its options, warrants, conversion privileges or other legal or
     contractual rights to obtain Old Common Stock representing such Interest,
     which shall become fully vested as of the date of exercise of such right
     notwithstanding any provision to the contrary in the contract or instrument
     giving rise to such Interest. To exercise such right, such Holder shall (i)
     mark or check off the applicable box on the Ballot cast by such Holder
     indicating such Holder's exercise of such right and (ii) on or before the
     Effective Date, pay all required consideration and otherwise satisfy all
     other applicable conditions in order to exercise such right. If such Holder
     timely exercises its right to obtain such Old Common Stock, such Holder
     shall be entitled to the treatment provided to Class 7 set forth in Section
     3.12 of the Plan with respect to such Old Common Stock. If such Holder
     fails to timely exercise its right to obtain such Old Common Stock, such
     Holder's Old Other Interest shall


     be canceled and extinguished and such Holder shall not receive or retain
     any property under the Plan on account of such Interest.

o    Class 9 Interests: Subsidiary Interests. There are 6 Holders of Subsidiary
     Interests. In particular, ADLT is the Holder of the Subsidiary Interests in
     and to VLI, ADLT Services, Ballastronix and Microsun. VLI is the Holder of
     the Subsidiary Interests in and to LRI and APL (ADLT is the indirect Holder
     of such Interests). Class 9 Interests are Unimpaired. Each Holder of an
     Interest in Class 9 shall retain such Interest and its respective share or
     shares of common stock of the Subsidiary Debtors representing such
     Interest, but such Holder shall receive no distribution under the Plan on
     account of such Interest; provided, however, that as soon as practicable
     after the Effective Date, the Reorganized Debtors shall cause Microsun, LRI
     and ADLT Services to be dissolved or merged into one of the other Debtors.

o    A vote in favor of the Plan will be deemed to constitute, among other
     things, (i) your consent to the releases set forth in the Plan (provided
     that you so indicate your consent on your Ballot), (ii) if you are a Holder
     of an Old Note, your waiver of any and all defaults under the Old Indenture
     governing the Old Notes that may exist as of the Effective Date of the
     Plan, (iii) if you are a Holder of an Old Note, your agreement to instruct
     the Old Indenture Trustee to take all necessary actions to effectuate the
     Plan and (iv) your approval of the Management Incentive Plan and the Senior
     Management Contracts.

o    With respect to each Impaired Class of Claims entitled to vote on the Plan,
     we must receive approval of the Plan from (i) the Holders of such Claims
     holding at least two-thirds (2/3) in amount of such Claims actually voting
     in such Class (other than Claims held by any Holder designated pursuant to
     section 1126(e) of the Bankruptcy Code) and (ii) more than one-half (1/2)
     in number of the Holders of such Claims actually voting in such Class
     (other than Claims held by any Holder designated pursuant to section
     1126(e) of the Bankruptcy Code). With respect to each Impaired Class of
     Interests entitled to vote on the Plan, we must receive approval from the
     Holders of such Interests holding at least two-thirds (2/3) in amount of
     such Interests actually voting in such Class (other than Interests held by
     any Holder designated pursuant to section 1126(e) of the Bankruptcy Code).
     See "THE PLAN--Voting on the Plan."

o    If you wish to vote on the Plan, you must return your properly completed
     Ballot in accordance with the instructions set forth therein so that it is
     received by the Voting Agent prior to 5:00 p.m., Pacific time, on November
     24, 2003 (the "Voting Termination Date").

o    After you have cast your vote to accept or reject the Plan, you will need
     the approval of the Bankruptcy Court to withdraw or change your vote on the
     Plan.



     The confirmation and effectiveness of the Plan are subject to approval of
the Bankruptcy Court. See "RISK FACTORS--Risks Related to the Plan--Risk of
Non-Confirmation of the Plan." We cannot assure you that the Bankruptcy Court
will approve the Plan or that it will be consummated.






                                TABLE OF CONTENTS

Section                                                                    Page
- -------                                                                    ----

Solicitation of Plan Acceptances.............................................i

The Plan Solicitation.......................................................ii

IMPORTANT INFORMATION REGARDING THE PLAN.....................................x
     Where You Can Find More Information....................................xi
     Incorporation By Reference.............................................xi
     Projections............................................................ii

SUMMARY OF THE RECAPITALIZATION..............................................1
     The Company.............................................................1
     Background of the Restructuring.........................................1
     The Recapitalization....................................................2
     Board of Directors......................................................9
     Procedure for Approving the Plan.......................................10
     Expiration, Termination and Withdrawal.................................10
     Interpretation and Effect of Ballots...................................10
     Objections to the Plan and this Disclosure Statement...................11
     Solicitation of Acceptances............................................12
     Voting Procedures......................................................12
     Unimpaired Classes.....................................................13
     Voting Impaired Classes................................................13
     Summary of Distributions Under the Plan................................14
     Certain Consequences of the Plan.......................................15
         Consequences of Failure to Confirm the Plan........................15
         Consequences of the Recapitalization...............................15


                                       i



     Federal Income Tax Considerations......................................15
     Description of Capital Stock and New ADLT Articles of
         Incorporation and Code of Regulations (By-Laws)....................15
     Listing and Trading of Old Notes, New Notes, Old Common Stock
         and New Common Stock...............................................15
     Voting Agent...........................................................16
     Board Recommendation...................................................16
     Selected Financial Data................................................16

RISK FACTORS................................................................19
     Risks if the Recapitalization is Not Successfully Completed............19
     Risks Related to the Plan..............................................19
         Risk of Non-Confirmation of the Plan...............................19
     Risks Related to Ownership of New Common Stock.........................20
         Other Risks Relating to the Debtors and Their Businesses...........20

CAPITALIZATION..............................................................20

BANKRUPTCY SCHEDULES OF ASSETS AND LIABILITIES..............................21

COMPANY BACKGROUND AND PURPOSE FOR THE RECAPITALIZATION.....................22
     The Company............................................................22
     Background of the Restructuring........................................22
     Our Management Team....................................................23
     Purpose of the Recapitalization........................................25

VALUATION AND PROJECTED FINANCIAL INFORMATION...............................25
     Valuation Analysis.....................................................25
     Projected Financial Information........................................25

THE PLAN....................................................................26
     Brief Explanation of Chapter 11 Reorganization.........................26


                                      ii



     Solicitation of Acceptances of the Plan................................27
     Voting on the Plan.....................................................29
     Classifications of Claims and Interests................................30
         Unimpaired Classes.................................................30
         Voting Impaired Classes............................................31
     Summary of Distributions Under the Plan................................31
         Administrative Claims..............................................32
         Priority Tax Claims................................................33
         DIP Facility Claim.................................................33
         Class 1(a)--Miscellaneous Secured Claims...........................34
         Class 1(b)--GE Secured Claims......................................34
         Class 2--Classified Priority Claims................................34
         Class 3--Old Note Claims...........................................35
         Class 4--ADLT General Unsecured Claims.............................36
         Class 5--Subsidiary Debtor General Unsecured Claims................37
         Class 6--Preferred Interests.......................................39
         Class 7--Common Interests..........................................39
         Class 8--Old Other Interests.......................................40
         Class 9--Subsidiary Interests......................................40
     Summary of Other Provisions of or Relating to the Plan.................41
         Preservation of Rights.............................................41
         Adoption of Senior Management Contracts............................41
         Adoption of Management Incentive Plan..............................41
         Saratoga Management Services Agreement.............................42
         Saratoga/GE Stock Purchase Agreement...............................43


                                      iii



         Treatment of Hellman Loan..........................................45
         Treatment of Executory Contracts and Unexpired Leases..............46
         Conditions to Effectiveness........................................48
     Board of Directors.....................................................49
     New ADLT Articles of Incorporation.....................................49
     Means for Implementation of the Plan...................................49
     Expenses and Sources of Cash to be Used in Connection with the Plan....49
     Modification of the Plan...............................................50
     Withdrawal of the Plan.................................................51
     Withdrawal of Votes on the Plan........................................51
     Confirmation of the Plan...............................................51
     Acceptance of the Plan.................................................52
     Feasibility Test.......................................................52
     Best Interests of Creditors Test; Liquidation Value....................52
     Effects of Plan Confirmation...........................................53
         Discharge..........................................................53
     Injunction.............................................................54
         Discharged Claims and Terminated Interests.........................54
         Released Claims and Interests......................................54
         Exculpation........................................................55
     Releases...............................................................55
         Releases by Debtors................................................55
         Releases by Holders of Claims and Interests........................56
         Indemnification....................................................57
         Revesting of the Debtors...........................................57


                                      iv



     Retention of Jurisdiction..............................................58
         Exclusive Jurisdiction of Bankruptcy Court.........................58
         Non-Exclusive Jurisdiction of Bankruptcy Court.....................59
     Alternatives to Confirmation and Consummation of the Plan..............60
         Sale of Some or All of Debtors' Business Operations................60
         Alternative Plan of Reorganization.................................60
         Liquidation Under Chapter 7........................................61

ACTIONS TAKEN DURING THE CHAPTER 11 CASES...................................61
     Operations Since Commencement of the Chapter 11 Cases..................61
     Relief Requested from the Bankruptcy Court.............................61
         Provisions for Prior Lenders.......................................61
         Treatment of Employees.............................................62
         Applications for Retention of the Debtors' Professionals...........62
         Motion to Continue Using Existing Cash Management System...........62
         Motion to Pay Critical Vendors.....................................62
         Motion to Honor Customer Programs and Practices....................63
     Committees.............................................................63

MANAGEMENT, BOARD OF DIRECTORS AND INSIDER RELATIONSHIPS....................63
     Management.............................................................63
     Board of Directors.....................................................64
     Management Incentive Plan..............................................64
     Senior Management Employment Agreements................................64
     Certain Transactions and Relationships with Insiders or
         Otherwise Related Parties..........................................65

ACCOUNTING TREATMENT OF THE RECAPITALIZATION................................67

FEDERAL INCOME TAX CONSIDERATIONS...........................................68


                                       v



     Tax Consequences to the Company........................................73

SECURITIES LAW MATTERS......................................................73
     Solicitation of Acceptances of Plan....................................73
     Issuance and Resale of the New Notes, New Preferred Stock
         and New Common Stock Under a Bankruptcy Plan.......................74

DESCRIPTION OF THE OLD NOTES................................................74
     Material Terms.........................................................74

DESCRIPTION OF CAPITAL STOCK AND NEW ARTICLES OF INCORPORATION
AND CODE OF REGULATIONS (BY-LAWS)...........................................75
     Old Common Stock and New Common Stock..................................75
     Old Preferred Stock and New Preferred Stock............................75

PRICE RANGE OF OLD COMMON STOCK AND DELISTING...............................77
     Price Range of Old Common Stock........................................77
     Limited Trading Market.................................................77

IMPORTANT CONTACT INFORMATION...............................................78
     The Voting Agent.......................................................78

CONCLUSION AND RECOMMENDATION...............................................78


                                      vi



                      Disclosure Statement with Respect to
                 First Amended Chapter 11 Plan of Reorganization
                              Dated August 15, 2003

                        Solicitation of Plan Acceptances

         Advanced Lighting Technologies, Inc. ("ADLT") and certain of its
subsidiaries (the "Subsidiary Debtors" and, together with ADLT, the "Debtors")
and Saratoga Lighting Holdings LLC ("Saratoga") propose a recapitalization plan
(the "Recapitalization") as described in this Disclosure Statement (the
"Disclosure Statement"). The Recapitalization will be accomplished through the
first amended plan of reorganization (the "Plan") under Chapter 11 ("Chapter
11") of title 11 of the United States Code (the "Bankruptcy Code"). The
Recapitalization involves (A) the exchange of ADLT's $100,000,000 Senior Notes
due March 15, 2008 (the "Old Notes") for approximately $114,356,000 Senior Notes
due September 15, 2010 (the "New Notes"); (B) the exchange of ADLT's outstanding
preferred stock (the "Old Preferred Stock") currently held by Saratoga and an
$18 million Cash infusion into the Debtors by Saratoga for 100% of the shares of
new preferred stock (the "New Preferred Stock") and 100% of the shares of new
common stock issued as of the Effective Date (the "New Common Stock")
(representing 90.8% of the Fully Diluted New Common Stock) to be issued to
Saratoga; and (C) the exchange of ADLT's outstanding common stock (23,807,347
shares issued and outstanding) (the "Old Common Stock") for Cash distributions
between $0.1197 (11.97 cents) and $0.105 (10.5 cents) per share (in the
aggregate between $2,850,000 and $2,500,000). Certain members of the Debtors'
Senior Management shall receive Management Options under the Management
Incentive Program to purchase in the aggregate 9.2% of the Fully Diluted New
Common Stock.

         Holders of Miscellaneous Secured Claims shall receive, at the Debtors'
option, Cash equal to the amount of each such Allowed Claim or treatment such
that such Claim shall be Reinstated. The Holder of the GE Secured Claims shall
be entitled to off set from the amounts owing by such Holder to the Debtors,
including the Debtors' nondebtor affiliates, an amount up to, but not in excess
of, the Allowed Amount of the GE Secured Claims; if, after giving effect to this
offset, such Holder has any remaining Claims against the Debtors, such Claims
shall be treated as Class 5 Subsidiary Debtor General Unsecured Claims. Holders
of Class 4 ADLT General Unsecured Claims and Class 5 Subsidiary Debtor General
Unsecured Claims shall receive, at their option, either certain quarterly
installments of Cash to be paid over one (1) year such that the full amount of
each such Claim shall be paid in full, plus interest accruing after the
Effective Date, or a single Cash distribution equal to eighty five percent (85%)
of the Allowed amount of each such Claim.

         Prior to the Effective Date, Holders of Old Other Interests shall have
the right to exercise their options, warrants, conversion privileges or other
legal or contractual rights to obtain Old Common Stock representing such
Interests, in which event such Holders shall be entitled to the treatment
provided to Class 7 under the Plan with respect to such Old Common Stock.
Finally, each Holder of a Subsidiary Interest in Class 9 shall retain

                                       i


such Interest and its respective share or shares of common stock of the
Subsidiary Debtors representing such Interest, but such Holder shall receive no
distribution under the Plan on account of such Interest; provided, however, that
as soon as practicable after the Effective Date, the Reorganized Debtors shall
cause Microsun, LRI and ADLT Services to be dissolved or merged into one of the
other Debtors.

         References in this Disclosure Statement to the "Company," "we," "us,"
"our Company" and "ourselves" refer to Advanced Lighting Technologies, Inc. and
its subsidiaries unless the context clearly requires otherwise.

                              The Plan Solicitation

         Upon the terms and subject to the conditions set forth in this
Disclosure Statement and in the accompanying form of ballot (the "Ballot"), the
Debtors and Saratoga hereby solicit (the "Plan Solicitation") acceptances of the
Plan from the Holders of Impaired Claims and Impaired Interests in the following
Classes: (a) Class 1(b) GE Secured Claims; (b) Class 3 Old Note Claims; (c)
Class 4 ADLT General Unsecured Claims; (d) Class 5 Subsidiary Debtor General
Unsecured Claims; (e) Class 6 Preferred Interests; (f) Class 7 Common Interests;
and (g) Class 8 Old Other Interests.

Treatment of Classified Claims and Interests

         The proposed treatment of Classified Claims and Interests is as
follows:

         Class 1(a) Claims: Miscellaneous Secured Claims. Class 1(a)
Miscellaneous Secured Claims are Unimpaired. Each Holder of an Allowed Class
1(a) Miscellaneous Secured Claim shall receive, in the sole discretion of the
Debtors or the Reorganized Debtors, as the case may be, in full satisfaction,
settlement, release, extinguishment and discharge of such Claim: (A) Cash equal
to the amount of such Allowed Miscellaneous Secured Claim on or as soon as
practicable after the later of (i) the Effective Date, (ii) the date that such
Miscellaneous Secured Claim becomes Allowed and (iii) a date agreed to by the
Debtors or the Reorganized Debtors, as the case may be, and the Holder of such
Claim; (B) treatment such that such Miscellaneous Secured Claim is Reinstated;
or (C) such other treatment on such other terms and conditions as may be agreed
upon in writing by the Holder of such Claim and the Debtors or the Reorganized
Debtors, as the case may be, or as the Bankruptcy Court may order.

         Class 1(b) Claims: Secured Claims of GE. Class 1(b) GE Secured Claims
are Impaired. The Class 1(b) GE Secured Claims shall receive nothing on the
Effective Date, provided, however, on the Effective Date, or as soon thereafter
as the GE Secured Claims are Allowed, GE may offset from the amounts owing by GE
to the Debtors, including the Debtors' nondebtor affiliates, and indefeasibly
retain for GE's own account, an amount up to, but not in excess of, the Allowed
Amount of the GE Secured Claims. If, after giving effect to the offset provided
in Section 3.06(b) of the Plan, GE has any remaining Claims against the Debtors,
such Claims of GE shall be treated as Class 5 Subsidiary Debtor General
Unsecured Claims. Except to the extent of the offset permitted under Section
3.06(b) of the Plan, nothing in Section 3.06(b) of the Plan shall be or be
deemed

                                       ii


to be a waiver or release of any claim belonging to the Debtors or their
nondebtor affiliates against GE.

         Class 2 Claims: Classified Priority Claims. Class 2 Classified Priority
Claims are Unimpaired. To the extent that these Claims have not already been
paid pursuant to prior order of the Bankruptcy Court, each Holder of an Allowed
Class 2 Classified Priority Claim shall receive in full satisfaction,
settlement, release, extinguishment and discharge of such Claim: (A) the amount
of such unpaid Allowed Claim in Cash on or as soon as reasonably practicable
after the later of (i) the Effective Date, (ii) the date on which such Class 2
Claim becomes Allowed and (iii) a date agreed to by the Debtors or the
Reorganized Debtors, as the case may be, and the Holder of such Class 2 Claim;
or (B) such other treatment on such other terms and conditions as may be agreed
upon in writing by the Holder of such Claim and the Debtors or the Reorganized
Debtors, as the case may be, or as the Bankruptcy Court may order.

         Class 3 Claims: Old Note Claims.  The Old Note Claims are Allowed as
follows:

                  (A) if Class 3 accepts the Plan pursuant to ss.1129(a)(8)(A)
          of the Bankruptcy Code, such Old Note Claims shall be Allowed in an
          aggregate amount equal to the sum of (i) $107,145,205 (being the sum
          of $100,000,000 plus interest at 8% from March 16, 2002 to the
          Petition Date) plus (ii) interest on the amount mentioned in (A)(i) of
          section 3.08 of the Plan from the Petition Date to the Effective Date
          at the rate of 8% per annum, or

                  (B) if Class 3 does not so accept the Plan, then such Old Note
          Claims shall be Allowed in an aggregate amount equal to (i)
          $107,145,205 (being the sum of $100,000,000 plus interest at 8% from
          March 16, 2002 to the Petition Date) plus (ii) interest on the amount
          mentioned in (B)(i) of section 3.08 of the Plan from the Petition Date
          to the Effective Date at that rate per annum which is the greater of:

                           (1) 1.32% (such rate being (a) the weekly average
                  1-year constant maturity Treasury yield, as published by the
                  Board of Governors of the Federal Reserve System for the week
                  ending Friday January 31, 2003, the end of the calendar week
                  preceding the Petition Date, and (b) specified as the
                  interest rate allowed on judgments entered in federal courts
                  pursuant to 28 U.S.C. ss.1961 and reported on the following
                  site on the internet:
                  http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt),

                           (2) such other rate per annum as the Bankruptcy
                  Court determines is legally required by the applicable
                  provisions of the Bankruptcy Code for accruals of
                  post-petition interest on unsecured debt.

         Class 3 Old Note Claims are Impaired. On or as soon as practicable
after the Effective Date, each Holder of an Allowed Old Note Claim as of the
Distribution Record

                                      iii


Date shall receive from the Disbursing Agent, in full satisfaction, settlement,
release, extinguishment and discharge of such Claim, a New Note in a principal
amount equal to:

          (A) the unpaid principal amount of such Old Note held by such Holder
          plus

          (B) the amount of interest accrued but unpaid on such Old Note from
          March 16, 2002 to the Petition Date plus

          (C) interest on an amount equal to the sum of (A) and (B) in this
          sentence from the Petition Date to the Effective Date at the
          applicable rate as provided above in section 3.08 (A) or (B) of the
          Plan.

         Acceptance of the Plan by Class 3 shall, subject to consummation of the
Plan, constitute a waiver by all Holders of Class 3 Old Note Claims of any and
all defaults under the Old Indenture that may exist as of the Effective Date,
and an agreement to instruct the Old Indenture Trustee to take all actions to
effectuate the Plan.

         Class 4 Claims: ADLT General Unsecured Claims. The Class 4 ADLT General
Unsecured Claims are Impaired. Each Holder of Class 4 ADLT General Unsecured
Claims shall be entitled to receive interest on the Allowed Amount of such
Holder's claim from the Petition Date to the Effective Date at that rate per
annum which is the greater of:

                  (1) 1.32% (such rate being (a) the weekly average 1-year
          constant maturity Treasury yield, as published by the Board of
          Governors of the Federal Reserve System for the week ending Friday
          January 31, 2003, the end of the calendar week preceding the Petition
          Date, and (b) specified as the interest rate allowed on judgments
          entered in federal courts pursuant to 28 U.S.C. ss.1961 and reported
          on the following site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

                  (2) such other rate per annum as the Bankruptcy Court
          determines is legally required by the applicable provisions of the
          Bankruptcy Code for accruals of post-petition interest on unsecured
          debt.

         The Holder of each Class 4 ADLT General Unsecured Claim shall have an
election to accept either "85% Now Treatment" or "100% Stretch Treatment," as
described in ensuing sentences in Section 3.09 of the Plan. Such election shall
be exercised by each such Holder (including Holders of Disputed Class 4 Claims,
whether or not the proceedings to determine the Allowed Amount of such Holder's
Disputed Class 4 ADLT General Unsecured Claim shall have been concluded at the
Effective Date), pursuant to election forms which will be mailed to each such
Holder by Reorganized ADLT within five Cleveland, Ohio Business Days after the
Effective Date, subject to the requirement that each Holder who fails to have
made its election and to have caused its fully completed election form to have
been actually received by the Reorganized Debtors by 5:00 p.m. Cleveland time on
the 20th Cleveland, Ohio Business Day after the Effective Date shall be
conclusively deemed to have elected 85% Now Treatment.

                                       iv


          Each Holder who shall have elected 85% Now Treatment (or who shall
have been automatically deemed to have made such election) shall be entitled to
receive on the later of:

                   (1) 45 days after the Effective Date,

                   (2) the date on which such Holder's Class 4 ADLT General
          Unsecured Claim shall have become Allowed,

                   (3) the date on which such Class 4 ADLT General Unsecured
          Claim, or any portion thereof, shall be paid pursuant to the
          established ordinary course of business or dealings between ADLT and
          the Holder of such Claim, and

                   (4) such other date agreed to by the Debtors or the
          Reorganized Debtors, as the case may be, and the Holder of such Class
          4 ADLT General Unsecured Claim,

          an amount in Cash equal to 85% of the Allowed Amount of such Holder's
          Class 4 ADLT General Unsecured Claim.

          Holders who shall have elected 100% Stretch Treatment shall be
entitled to receive, starting on the later of:

                   (1) the first Calendar-Quarter-End Date after the Effective
          Date, and

                   (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 4 ADLT General Unsecured Claim shall have become
          Allowed, and on each of the next succeeding Calendar-Quarter-End Dates
          thereafter, until such Allowed Class 4 ADLT General Unsecured Claim is
          paid in full, an amount in Cash equal to 25% of the Allowed Amount of
          such Holder's Class 4 ADLT General Unsecured Claim, plus interest
          accrued on such portion of such Allowed Claim from the Effective Date
          through the date of such payment calculated at a rate (a) equal to the
          weekly average 1-year constant maturity Treasury yield, as published
          by the Board of Governors of the Federal Reserve System for the end of
          the calendar week in which the Effective Date occurs, and (b) as
          specified as the interest rate allowed on judgments entered in federal
          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 4
          ADLT General Unsecured Claim, except that Holders of Claims that shall
          have elected 100% Stretch Treatment remain Disputed Class 4 ADLT
          General Unsecured Claims on such 364th day shall be entitled to
          receive 100% of their Allowed Claim on the date of Allowance thereof.

                                       v


          All payments to Holders of Class 4 ADLT General Unsecured Claims shall
be made in Cash, unless otherwise agreed between Reorganized ADLT and the Holder
of such Claim.

         Class 5 Claims: Subsidiary Debtor General Unsecured Claims. The Class 5
Subsidiary Debtor General Unsecured Claims are Impaired. Each Holder of Class 5
Subsidiary Debtor General Unsecured Claims shall be entitled to receive interest
on the Allowed Amount of such Holder's claim from the Petition Date to the
Effective Date at that rate per annum which is the greater of:

                  (1) 1.32% (such rate being (a) the weekly average 1-year
          constant maturity Treasury yield, as published by the Board of
          Governors of the Federal Reserve System for the week ending Friday
          January 31, 2003, the end of the calendar week preceding the Petition
          Date, and (b) specified as the interest rate allowed on judgments
          entered in federal courts pursuant to 28 U.S.C. ss.1961 and reported
          on the following site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

                  (2) such other rate per annum as the Bankruptcy Court
          determines is legally required by the applicable provisions of the
          Bankruptcy Code for accruals of post-petition interest on unsecured
          debt.

         The Holder of each Class 5 Subsidiary Debtor General Unsecured Claim
shall have an election to accept either "85% Now Treatment" or "100% Stretch
Treatment," as described in ensuing sentences in section 3.10 of the Plan. Such
election shall be exercised by each such Holder (including Holders of Disputed
Claims, whether or not the proceedings to determine the Allowed Amount of such
Holder's Disputed Class 5 Subsidiary Debtor General Unsecured Claim shall have
been concluded at the Effective Date), pursuant to election forms which will be
mailed to each such Holder by Reorganized ADLT within five Cleveland, Ohio
Business Days after the Effective Date, subject to the requirement that each
Holder who fails to have made its election and to have caused its fully
completed election form to have been actually received by the Reorganized
Debtors by 5:00 p.m. Cleveland time on the 20th Cleveland, Ohio Business Day
after the Effective Date shall be conclusively deemed to have elected 85% Now
Treatment.

          Each Holder who shall have elected 85% Now Treatment (or who shall
have been automatically deemed to have made such election) shall be entitled to
receive on the later of:

                  (1) 45 days after the Effective Date,

                  (2) the date on which such Holder's Class 5 Subsidiary Debtor
          General Unsecured Claim shall have become Allowed,

                  (3) the date on which such Class 5 Subsidiary Debtor General
          Unsecured Claim, or any portion thereof, shall be paid pursuant to the
          established

                                       vi


          ordinary course of business or dealings between ADLT and the Holder of
          such Claim, and

                  (4) such other date agreed to by the Debtors or the
          Reorganized Debtors, as the case may be, and the Holder of such Class
          5 Subsidiary Debtor General Unsecured Claim, an amount in Cash equal
          to 85% of the Allowed Amount of such Holder's Class 5 Subsidiary
          Debtor General Unsecured Claim.

         Holders who shall have elected 100% Stretch Treatment shall be entitled
to receive, starting on the later of:

                  (1) the first Calendar-Quarter-End Date after the Effective
          Date, and

                   (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 5 Subsidiary Debtor General Unsecured Claim
          shall have become Allowed, and on each of the next succeeding
          Calendar-Quarter-End Dates thereafter, until such Allowed Class 5
          Subsidiary Debtor General Unsecured Claim is paid in full, an amount
          in Cash equal to 25% of the Allowed Amount of such Holder's Class 5
          Subsidiary Debtor General Unsecured Claim, plus interest accrued on
          such portion of such Allowed Claim from the Effective Date through the
          date of such payment calculated at a rate (a) equal to the weekly
          average 1-year constant maturity Treasury yield, as published by the
          Board of Governors of the Federal Reserve System for the end of the
          calendar week in which the Effective Date occurs, and (b) as specified
          as the interest rate allowed on judgments entered in federal courts
          pursuant to 28 U.S.C. ss.1961 and reported on the following site on
          the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 5
          Subsidiary Debtor General Unsecured Claim, except that Holders of
          Claims that shall have elected 100% Stretch Treatment remain Disputed
          Class 5 Subsidiary Debtor General Unsecured Claims on such 364th day
          shall be entitled to receive 100% of their Allowed Claim on the date
          of Allowance thereof.

         All payments to Holders of Class 5 Subsidiary Debtor General Unsecured
Claims shall be made in Cash, unless otherwise agreed between Reorganized ADLT
and the Holder of such Claim.

         Class 6 Interests: Old Preferred Stock Interests. Class 6 Preferred
Interests are Impaired. Saratoga holds Class 6 Interests in 761,250 Old
Preferred Shares; such Interests of Saratoga are hereby Allowed. On or as soon
as practicable after the Effective Date, Saratoga, the Holder of the Allowed
Class 6 Preferred Interest as of the Distribution Record Date shall receive, in
full satisfaction, settlement, release, extinguishment and discharge of such
Preferred Interest, and upon payment in Cash to ADLT by wire transfer of
immediately available funds, $18,000,000, 29,000 shares of New Preferred Stock
and 1,000 shares of New Common Stock, such that the Holders of the Allowed Class
6

                                      vii


Preferred Interests shall have received 100% of the authorized shares of New
Preferred Stock, all of which are to be outstanding on the Effective Date and
held by Saratoga, 100% of the shares of New Common Stock issued and outstanding
on the Effective Date and 90.8% of the Fully Diluted New Common Stock.
Acceptance of the Plan by Class 6 shall, subject to consummation of the Plan,
constitute an approval, as recipient of New Common Stock, of the Management
Incentive Plan and the Senior Management Contracts.

         Class 7 Interests: Old Common Stock Interests. Class 7 Common Interests
are Impaired. If Class 7 accepts the Plan pursuant to ss.1129(a)(8) of the
Bankruptcy Code then, on or as soon as practicable after the Effective Date,
each Holder of an Allowed Class 7 Interest as of the Distribution Record Date
(and any Holders in Class 8, other than Saratoga, electing to exercise their
rights as set forth in section 3.13 of the Plan) shall receive from the
Disbursing Agent, in full satisfaction, settlement, release, extinguishment,
cancellation and discharge of such Interest, for each share of Old Common Stock
held by such Holder, the sum of $0.1197 (11.97 cents) per share (based on
23,807,347 shares outstanding) payable such that the Holders of Class 7 Common
Interests shall have received in the aggregate $2,850,000; provided, however,
that the Cash distributions to be received by such Holders shall be reduced by
the aggregate amount of Allowed Professional Claims of Professionals retained by
or on behalf of the Equity Committee up to $350,000, such that, at a minimum,
such Holders shall have received in the aggregate $2,500,000 (resulting in a
Cash distribution of $0.105 (10.5 cents) per share of Old Common Stock (based on
23,807,347 shares outstanding)). If Class 7 does not accept the Plan pursuant to
ss.1129(a)(8) of the Bankruptcy Code then they will be entitled to $2,500,000,
pro rata, including Saratoga, payable in quarterly installments of 25% of the
amount payable to such Holder starting, with respect to each Holder of a Class 7
Interest, on the later of (i) the first Calendar-Quarter-End Date after the
Effective Date and (ii) the Calendar-Quarter-End Date next following the date on
which each such Old Common Stock Interest shall have become Allowed, and on each
of the next succeeding Calendar-Quarter-End Dates thereafter, until such Allowed
Old Common Stock Interest is paid in full the amount provided for in Section
3.12 of the Plan, subject to the proviso that on the 364th day after the
Effective Date of the Plan, each such Holder shall receive the entire
then-unpaid balance of the amount due under the Plan in respect of such Class 7
Interest, without interest. Regardless of the foregoing, Holders of Old Common
Stock Interests that remain Disputed on such 364th day shall be entitled to
receive 100% of the amount due on their Allowed Interest on the date of
Allowance thereof. All payments to Holders of Class 7 Old Common Stock Interests
shall be made in Cash unless otherwise agreed between Reorganized ADLT and the
Holder of such Interest. No interest will accrue or be payable on Class 7 Old
Common Stock Interests or the payments made to Holders thereof.

         Class 8 Interests: Old Other Interests. Class 8 Interests are Impaired.
Each Holder of an Old Other Interest shall have the right to exercise its
options, warrants, conversion privileges or other legal or contractual rights to
obtain Old Common Stock representing such Interest, which shall become fully
vested as of the date of exercise of such right notwithstanding any provision to
the contrary in the contract or instrument giving rise to such Interest. To
exercise such right, such Holder shall (i) mark or check

                                      viii


off the applicable box on the Ballot cast by such Holder indicating such
Holder's exercise of such right and (ii) on or before the Effective Date, pay
all required consideration and otherwise satisfy all other applicable conditions
in order to exercise such right. If such Holder timely exercises its right to
obtain such Old Common Stock, such Holder shall be entitled to the treatment
provided to Class 7 set forth in Section 3.12 of the Plan with respect to such
Old Common Stock. If such Holder fails to timely exercise its right to obtain
such Old Common Stock, such Holder's Old Other Interest shall be canceled and
extinguished and such Holder shall not receive or retain any property under the
Plan on account of such Interest.

         Class 9 Interests: Subsidiary Interests. Class 9 Interests are
Unimpaired. Each Holder of an Interest in Class 9 shall retain such Interest and
its respective share or shares of common stock of the Subsidiary Debtors
representing such Interest, but such Holder shall receive no distribution under
the Plan on account of such Interest; provided, however, that as soon as
practicable after the Effective Date, the Reorganized Debtors shall cause
Microsun, LRI and ADLT Services to be dissolved or merged into one of the other
Debtors.

Significant Disputed Claims

         Ruud Lighting, Inc. and certain related individuals (collectively, the
"Ruud Entities") filed three proofs of claim against ADLT and VLI asserting
various Claims, including, without limitation, a "Contingent Warranty Claim ...
[p]erhaps in excess of $50 million." The Debtors thereafter filed an objection
to these Claims. The Debtors and the Ruud Entities have reached an agreement to
resolve their competing claims, for which the Debtors intend to seek Bankruptcy
Court approval. Under the proposed settlement, all of the Ruud Entities' Claims
will be disallowed, with prejudice, in exchange for which certain promissory
notes owed by the Ruud Entities to ADLT due in December, 2006 will in the
aggregate be written down in amount. Additionally, the Debtors anticipate that
they may object to certain other proofs of claim filed against their estates.

         Payments and other distributions to be made pursuant to the Plan will
be available from the proceeds of the New Credit Facility and other funds held
by the Reorganized Debtors as of the Effective Date.

- --------------------------------------------------------------------------------
         THE DEADLINE TO ACCEPT OR REJECT THE PLAN IS 5:00 P.M., PACIFIC TIME,
ON NOVEMBER 24, 2003 (THE "VOTING TERMINATION DATE"). IN ORDER TO BE COUNTED,
BALLOTS MUST BE RECEIVED BY THE VOTING AGENT ON OR PRIOR TO THE VOTING
TERMINATION DATE.
- --------------------------------------------------------------------------------


                                       ix


                    IMPORTANT INFORMATION REGARDING THE PLAN

         ADLT's Board of Directors has unanimously approved the Plan and
recommends that all Holders of Claims or Interests in Classes 1(b), 3, 4, 5, 6,
7 and 8 vote to accept the Plan. These Classes will be Impaired by the Plan and
whose affirmative votes are being sought in connection with confirmation of the
Plan.

         Please read this Disclosure Statement and the Plan completely and
carefully. The Debtors and Saratoga believe that the Plan provides equal or
greater value to you than other available alternatives and, therefore, believe
that acceptance of the Plan is in your best interests and recommend that you
vote to accept the Plan.

         The statements contained in this Disclosure Statement are made as of
the date hereof (unless otherwise stated) and neither the delivery of this
Disclosure Statement nor any cancellation or other treatment of the Old Notes,
the Old Preferred Stock or the Old Common Stock, or issuance of the New Notes,
the New Preferred Stock or the New Common Stock, made pursuant to the Plan will,
under any circumstances, create any implication that the information contained
herein is correct at any time subsequent to the date hereof.

         The contents of this Disclosure Statement should not be construed as
legal, business, financial or tax advice. You should consult with your legal,
business, financial and tax advisors as to any matters concerning this
Disclosure Statement, the Plan and the transactions contemplated thereby.

         We believe that this Disclosure Statement contains information of a
kind, and in sufficient detail, adequate to enable a hypothetical reasonable
creditor or investor to make an informed judgment to vote whether to accept or
reject the Plan.

         Other than as explicitly set forth in this Disclosure Statement
(including the Annexes and Exhibits attached hereto and information incorporated
herein by reference), you should not rely upon any information relating to the
Debtors, the value of their assets, the nature of their liabilities or their
creditors' claims.

         This Disclosure Statement is not an offer to sell the New Notes, the
New Preferred Stock or the New Common Stock nor an offer to buy the Old Notes,
the Old Preferred Stock or the Old Common Stock in any jurisdiction where such
offer or sale is not permitted. This Disclosure Statement seeks only your
consent to the Plan. The exchange of the Old Notes, the Old Preferred Stock and
the Old Common Stock and the issuance of the New Notes, the New Preferred Stock
and the New Common Stock pursuant to the Plan will occur only upon confirmation
of the Plan by the Bankruptcy Court.

         Holders of Claims or Interests who have questions concerning the
procedure for voting, who did not receive a Ballot, received a damaged Ballot,
need an additional Ballot or have lost their Ballot, should contact our Voting
Agent:

                                       x


                                    Bankruptcy Management Corporation
                                    1330 East Franklin Avenue
                                    P.O. Box 937
                                    El Segundo, California  90245-0937
                                    Attn:  VLI Voting Agent
                                    Telephone:  (310) 321-5555
                                    Facsimile:  (310) 640-8071

         We do not intend to solicit votes on the Plan from Holders of
Unimpaired Claims or Unimpaired Interests in Classes 1(a), 2 and 9; therefore,
Ballots are not being transmitted to such Holders.

Where You Can Find More Information

         We currently file annual, quarterly and special reports, proxy
statements and other information with the Securities and Exchange Commission
(the "SEC"). You may read and copy any document we file with the SEC at the
SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549,
or at the SEC's regional office located at 175 West Jackson Boulevard, Suite
900, Chicago, Illinois 60604. You may obtain further information on the
operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Our
SEC filings are also available to the public over the Internet at the SEC's Web
site at http://www.sec.gov.

Incorporation By Reference

         We are incorporating by reference into this Disclosure Statement our
(a) Annual Report on Form 10-K for the fiscal year ended June 30, 2002, (b)
Quarterly Report on Form 10-Q for the first fiscal quarter ended September 30,
2002, (c) Quarterly Report on Form 10-Q for the second fiscal quarter ended
December 31, 2002, (d) Quarterly Report on Form 10-Q for the third fiscal
quarter ended March 31, 2003 and (e) all of our filings with the SEC under
Sections 13(a), 131(c), 14, or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), from the date of filing of the last aforementioned
report until the completion of the Recapitalization. The information
incorporated by reference is considered to be part of this Disclosure Statement
and later information that we file with the SEC, including our Annual Report on
Form 10-K for the fiscal year ended June 30, 2003, will automatically update and
supersede this information.

         You may obtain copies of these filings, at no cost, by writing or
telephoning us at:

                                    Advanced Lighting Technologies, Inc.
                                    32000 Aurora Road
                                    Solon, Ohio 44139
                                    Attn:  Jennifer Kurowski
                                    Phone:  (440) 519-0500

                                       xi


Projections

         This Disclosure Statement and certain of the Annexes hereto contain
projections of, among other things, future results of operations. We do not as a
matter of course publicly disclose projections, but we have prepared such
information in connection with the Plan solely for purposes of demonstrating
that, as required by section 1129(a)(11) of the Bankruptcy Code, confirmation of
the Plan is not likely to be followed by the liquidation, or the need for
further financial reorganization, of the Debtors and to assist in the
preparation of a valuation analysis. This information was prepared by us and was
not prepared with a view toward compliance with published guidelines of the SEC,
the American Institute of Certified Public Accountants or any other regulatory
or professional agency or body, generally accepted accounting principles or
consistency with our audited financial statements. In addition, Grant Thornton
LLP, our independent auditor, has neither compiled nor examined the estimates
and projections and, accordingly, does not express any opinion or any other form
of assurance with respect to, assumes no responsibility for, and disclaims any
association with, these estimates and projections. These estimates and
projections should be read together with the information contained under the
heading "RISK FACTORS" in this Disclosure Statement and the information and
financial statements and related notes thereto included in our Annual Report on
Form 10-K, Quarterly Reports on Form 10-Q and other filings with the SEC, which
are incorporated by reference into this Disclosure Statement.

         The projections are based upon a number of assumptions and estimates
presented with numerical specificity and considered reasonable by us when taken
as a whole. These assumptions and estimates, however, are inherently subject to
significant business, economic and competitive uncertainties and contingencies,
many of which are beyond our control and are based upon specific assumptions
with respect to future business decisions. Projections and estimates are
necessarily speculative in nature and it can be expected that the assumptions of
the estimates and projections will not prove to be valid. See the information
contained under the heading "RISK FACTORS" in this Disclosure Statement. Actual
results will vary from the estimates used in making the projections and the
variations may be material. Consequently, this Disclosure Statement should not
be regarded as a representation by us or any other person of results that will
actually be achieved.


                                      xii


                         SUMMARY OF THE RECAPITALIZATION

         This summary highlights some of the information contained elsewhere or
incorporated by reference in this document. It does not contain all of the
information that may be important to you. You should carefully read this entire
document and the other documents to which it refers before deciding whether to
vote in favor of the Plan.

The Company

         ADLT was formed on May 19, 1995, and acquired ownership, primarily by
merger, of affiliated companies, including the Subsidiary Debtors (other than
Ballastronix), that were previously under common ownership and management. ADLT
is an innovation-driven designer, manufacturer and marketer of metal halide
lighting products. ADLT believes that it is the only designer and manufacturer
in the world focused primarily on metal halide lighting. As a result of this
unique focus, ADLT has developed substantial expertise in all aspects of metal
halide lighting. ADLT believes that this focus enhances its responsiveness to
customer demand and has contributed to its technologically advanced product
development and manufacturing capabilities. Further information regarding ADLT
and its subsidiaries is set forth in our Annual Report on Form 10-K for the
fiscal year ended June 30, 2002, Quarterly Reports on Form 10-Q for the fiscal
quarters ended September 30, 2002, December 31, 2002 and March 31, 2003, and
other filings with the SEC, which are incorporated by reference into this
Disclosure Statement.

Background of the Restructuring

         Prior to the Petition Date, ADLT had established certain revolving
credit facilities with a bank group headed by PNC Bank, N.A. (the "Prior
Lenders"). These prepetition credit facilities were secured by certain liens and
security interests granted by ADLT and other borrowers and guarantors upon such
parties' respective assets and property.

         On or about August 21, 2002, the Prior Lenders issued a notice of
default under the governing credit agreement as a result of the borrowers'
breach of certain financial covenants. Thereafter, on September 16, the
borrowers and the Prior Lenders entered into a forbearance agreement pursuant to
which the Prior Lenders agreed to forbear from exercising their rights and
remedies under the credit agreement based on the borrowers' prior financial
covenant defaults. The borrowers were allowed access to their credit facilities,
but not in amounts sufficient to enable ADLT to make a required $4 million
interest payment to Holders of the Old Notes on September 16, 2002.

         On October 18, 2002, the borrowers and the Prior Lenders entered into
an amended forbearance agreement under which the Prior Lenders agreed to
continue making the prepetition credit facilities available to the borrowers,
provided that, among other things, ADLT retain a financial consultant to assist
in the refinance of the indebtedness owed to the Prior Lenders and an investment
banker to explore a possible sale of all or a significant portion of the
borrowers' assets in order to pay off the outstanding indebtedness to the Prior
Lenders. Throughout the fall of 2002, the borrowers sought to refinance the
obligations owing to the Prior Lenders.

         On or about January 7, 2003, the Prior Lenders declared the borrowers
to be in default under the amended forbearance agreement. The Prior Lenders then
advised the borrowers that

                                       1


(a) no further financing would be available after February 5, 2003 outside of
the Chapter 11 Cases, and (b) in no event prior to February 5, 2003 would
advances under the prepetition credit facilities exceed the borrowing base
thereunder. As a result, the borrowers determined that the commencement of the
Chapter 11 Cases with the support of a DIP facility offered by the Prior Lenders
was the surest way to preserve their businesses, assets and going concern
values.

         In response to ADLT's failure to make the scheduled interest payment in
September 2002, certain Holders of Old Notes formed an ad hoc committee to
negotiate with ADLT to restructure its capital structure or otherwise resolve
the situation. On January 22, 2003, the Old Indenture Trustee accelerated the
Old Notes.

         Prior to the Petition Date, ADLT and an ad hoc committee of Holders of
Old Notes engaged in restructuring negotiations. After the Petition Date, ADLT
continued negotiations with the Creditors Committee, which was and is dominated
by Holders of Old Notes, and GE, ADLT's former preferred shareholder.
Thereafter, the Debtors reached an agreement in principle with the Creditors
Committee and GE regarding the terms of a consensual joint plan and commenced
working on a joint plan, disclosure statement and related plan documents.
However, on August 15, 2003, GE sold its equity interests to Saratoga, which was
not interested in pursuing the joint plan. On August 15, 2003, the Debtors and
Saratoga, as co-Proponents, filed the Plan with the Bankruptcy Court.

The Recapitalization

         We will complete the Recapitalization in the Chapter 11 Cases through
the Plan as described below. In order for us to do so, we must receive approval
of the Plan from (a) with respect to each Impaired Class of Claims entitled to
vote on the Plan, (i) the Holders of Claims holding at least two-thirds (2/3) in
amount of such Claims actually voting in such Class (other than Claims held by
any Holder designated pursuant to section 1126(e) of the Bankruptcy Code) and
(ii) more than one-half (1/2) in number of the Holders of such Claims actually
voting in such Class (other than Claims held by any Holder designated pursuant
to section 1126(e) of the Bankruptcy Code); and (b) with respect to each
Impaired Class of Interests entitled to vote on the Plan, we must receive
approval from the Holders of such Interests holding at least two-thirds (2/3) in
amount of such Interests actually voting in such Class (other than Interests
held by any Holder designated pursuant to section 1126(e) of the Bankruptcy
Code). Additionally, we reserve the right to request that the Bankruptcy Court
confirm the Plan in accordance with section 1129(b) of the Bankruptcy Code,
notwithstanding the requirements of section 1129(a)(8) thereof, on the basis
that the Plan is fair and equitable, and does not discriminate unfairly, with
respect to each Class of Claims or Interests that is Impaired under, and has not
accepted, the Plan. Further the Plan must be confirmed (approved) by the
Bankruptcy Court. See "THE PLAN--Voting on the Plan." If the Plan is confirmed,
even if you did not vote or voted against the Plan, the Plan's proposed
treatment of your Claim or Interest will be binding on you.

     The Recapitalization will consist of the following:

o    Class 1(a) Claims: Miscellaneous Secured Claims. Class 1(a) Miscellaneous
     Secured Claims are Unimpaired. Each Holder of an Allowed Class 1(a)
     Miscellaneous Secured Claim shall receive, in the sole discretion of the
     Debtors or the Reorganized Debtors, as the case may be, in full
     satisfaction, settlement, release, extinguishment and discharge of

                                       2


     such Claim: (A) Cash equal to the amount of such Allowed Miscellaneous
     Secured Claim on or as soon as practicable after the later of (i) the
     Effective Date, (ii) the date that such Miscellaneous Secured Claim becomes
     Allowed and (iii) a date agreed to by the Debtors or the Reorganized
     Debtors, as the case may be, and the Holder of such Claim; (B) treatment
     such that such Miscellaneous Secured Claim is Reinstated; or (C) such other
     treatment on such other terms and conditions as may be agreed upon in
     writing by the Holder of such Claim and the Debtors or the Reorganized
     Debtors, as the case may be, or as the Bankruptcy Court may order.

o    Class 1(b) Claims: Secured Claims of GE. Class 1(b) GE Secured Claims are
     Impaired. The Class 1(b) GE Secured Claims shall receive nothing on the
     Effective Date, provided, however, on the Effective Date, or as soon
     thereafter as the GE Secured Claims are Allowed, GE may offset from the
     amounts owing by GE to the Debtors, including the Debtors' nondebtor
     affiliates, and indefeasibly retain for GE's own account, an amount up to,
     but not in excess of, the Allowed Amount of the GE Secured Claims. If,
     after giving effect to the offset provided in Section 3.06(b) of the Plan,
     GE has any remaining Claims against the Debtors, such Claims of GE shall be
     treated as Class 5 Subsidiary Debtor General Unsecured Claims. Except to
     the extent of the offset permitted under Section 3.06(b) of the Plan,
     nothing in Section 3.06(b) of the Plan shall be or be deemed to be a waiver
     or release of any claim belonging to the Debtors or their nondebtor
     affiliates against GE.

o    Class 2 Claims: Classified Priority Claims. Class 2 Classified Priority
     Claims are Unimpaired. To the extent that these Claims have not already
     been paid pursuant to prior order of the Bankruptcy Court, each Holder of
     an Allowed Class 2 Classified Priority Claim shall receive in full
     satisfaction, settlement, release, extinguishment and discharge of such
     Claim: (A) the amount of such unpaid Allowed Claim in Cash on or as soon as
     reasonably practicable after the later of (i) the Effective Date, (ii) the
     date on which such Class 2 Claim becomes Allowed and (iii) a date agreed to
     by the Debtors or the Reorganized Debtors, as the case may be, and the
     Holder of such Class 2 Claim; or (B) such other treatment on such other
     terms and conditions as may be agreed upon in writing by the Holder of such
     Claim and the Debtors or the Reorganized Debtors, as the case may be, or as
     the Bankruptcy Court may order.

o    Class 3 Claims: Old Note Claims. The Old Note Claims are Allowed as
     follows:

          (A) if Class 3 accepts the Plan pursuant to ss.1129(a)(8)(A) of the
     Bankruptcy Code, such Old Note Claims shall be Allowed in an aggregate
     amount equal to the sum of (i) $107,145,205 (being the sum of $100,000,000
     plus interest at 8% from March 16, 2002 to the Petition Date) plus (ii)
     interest on the amount mentioned in (A)(i) of section 3.08 of the Plan from
     the Petition Date to the Effective Date at the rate of 8% per annum, or

          (B) if Class 3 does not so accept the Plan, then such Old Note Claims
     shall be Allowed in an aggregate amount equal to (i) $107,145,205 (being
     the sum of $100,000,000 plus interest at 8% from March 16, 2002 to the
     Petition Date) plus (ii) interest on the amount mentioned in (B)(i) of
     section 3.08 of the

                                       3


     Plan from the Petition Date to the Effective Date at that rate per annum
     which is the greater of:

                    (1) 1.32% (such rate being (a) the weekly average 1-year
               constant maturity Treasury yield, as published by the Board of
               Governors of the Federal Reserve System for the week ending
               Friday January 31, 2003, the end of the calendar week preceding
               the Petition Date, and (b) specified as the interest rate allowed
               on judgments entered in federal courts pursuant to 28 U.S.C.
               ss.1961 and reported on the following site on the internet:
               http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt),

                    (2) such other rate per annum as the Bankruptcy Court
               determines is legally required by the applicable provisions of
               the Bankruptcy Code for accruals of post-petition interest on
               unsecured debt.

          Class 3 Old Note Claims are Impaired. On or as soon as practicable
     after the Effective Date, each Holder of an Allowed Old Note Claim as of
     the Distribution Record Date shall receive from the Disbursing Agent, in
     full satisfaction, settlement, release, extinguishment and discharge of
     such Claim, a New Note in a principal amount equal to:

          (A) the unpaid principal amount of such Old Note held by such Holder
          plus

          (B) the amount of interest accrued but unpaid on such Old Note from
          March 16, 2002 to the Petition Date plus

          (C) interest on an amount equal to the sum of (A) and (B) in this
          sentence from the Petition Date to the Effective Date at the
          applicable rate as provided above in section 3.08 (A) or (B) of the
          Plan.

          Acceptance of the Plan by Class 3 shall, subject to consummation of
     the Plan, constitute a waiver by all Holders of Class 3 Old Note Claims of
     any and all defaults under the Old Indenture that may exist as of the
     Effective Date, and an agreement to instruct the Old Indenture Trustee to
     take all actions to effectuate the Plan.

o    Class 4 Claims: ADLT General Unsecured Claims. The Class 4 ADLT General
     Unsecured Claims are Impaired. Each Holder of Class 4 ADLT General
     Unsecured Claims shall be entitled to receive interest on the Allowed
     Amount of such Holder's claim from the Petition Date to the Effective Date
     at that rate per annum which is the greater of:

               (1) 1.32% (such rate being (a) the weekly average 1-year constant
          maturity Treasury yield, as published by the Board of Governors of the
          Federal Reserve System for the week ending Friday January 31, 2003,
          the end of the calendar week preceding the Petition Date, and (b)
          specified as the interest rate allowed on judgments entered in federal
          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

                                       4


               (2) such other rate per annum as the Bankruptcy Court determines
          is legally required by the applicable provisions of the Bankruptcy
          Code for accruals of post-petition interest on unsecured debt.

          The Holder of each Class 4 ADLT General Unsecured Claim shall have an
     election to accept either "85% Now Treatment" or "100% Stretch Treatment,"
     as described in ensuing sentences in Section 3.09 of the Plan. Such
     election shall be exercised by each such Holder (including Holders of
     Disputed Class 4 Claims, whether or not the proceedings to determine the
     Allowed Amount of such Holder's Disputed Class 4 ADLT General Unsecured
     Claim shall have been concluded at the Effective Date), pursuant to
     election forms which will be mailed to each such Holder by Reorganized ADLT
     within five Cleveland, Ohio Business Days after the Effective Date, subject
     to the requirement that each Holder who fails to have made its election and
     to have caused its fully completed election form to have been actually
     received by the Reorganized Debtors by 5:00 p.m. Cleveland time on the 20th
     Cleveland, Ohio Business Day after the Effective Date shall be conclusively
     deemed to have elected 85% Now Treatment.

          Each Holder who shall have elected 85% Now Treatment (or who shall
     have been automatically deemed to have made such election) shall be
     entitled to receive on the later of:

               (1) 45 days after the Effective Date,

               (2) the date on which such Holder's Class 4 ADLT General
          Unsecured Claim shall have become Allowed,

               (3) the date on which such Class 4 ADLT General Unsecured Claim,
          or any portion thereof, shall be paid pursuant to the established
          ordinary course of business or dealings between ADLT and the Holder of
          such Claim, and

               (4) such other date agreed to by the Debtors or the Reorganized
          Debtors, as the case may be, and the Holder of such Class 4 ADLT
          General Unsecured Claim,

          an amount in Cash equal to 85% of the Allowed Amount of such Holder's
          Class 4 ADLT General Unsecured Claim.

          Holders who shall have elected 100% Stretch Treatment shall be
     entitled to receive, starting on the later of:

               (1) the first Calendar-Quarter-End Date after the Effective Date,
          and

               (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 4 ADLT General Unsecured Claim shall have become
          Allowed, and on each of the next succeeding Calendar-Quarter-End Dates
          thereafter, until such Allowed Class 4 ADLT General Unsecured Claim is
          paid in full, an amount in Cash equal to 25% of the Allowed Amount of
          such Holder's Class 4 ADLT General Unsecured Claim, plus interest
          accrued on such portion of such Allowed

                                       5


          Claim from the Effective Date through the date of such payment
          calculated at a rate (a) equal to the weekly average 1-year constant
          maturity Treasury yield, as published by the Board of Governors of the
          Federal Reserve System for the end of the calendar week in which the
          Effective Date occurs, and (b) as specified as the interest rate
          allowed on judgments entered in federal courts pursuant to 28 U.S.C.
          ss.1961 and reported on the following site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 4
          ADLT General Unsecured Claim, except that Holders of Claims that shall
          have elected 100% Stretch Treatment remain Disputed Class 4 ADLT
          General Unsecured Claims on such 364th day shall be entitled to
          receive 100% of their Allowed Claim on the date of Allowance thereof.

          All payments to Holders of Class 4 ADLT General Unsecured Claims shall
     be made in Cash, unless otherwise agreed between Reorganized ADLT and the
     Holder of such Claim.

o    Class 5 Claims: Subsidiary Debtor General Unsecured Claims. The Class 5
     Subsidiary Debtor General Unsecured Claims are Impaired. Each Holder of
     Class 5 Subsidiary Debtor General Unsecured Claims shall be entitled to
     receive interest on the Allowed Amount of such Holder's claim from the
     Petition Date to the Effective Date at that rate per annum which is the
     greater of:

               (1) 1.32% (such rate being (a) the weekly average 1-year constant
          maturity Treasury yield, as published by the Board of Governors of the
          Federal Reserve System for the week ending Friday January 31, 2003,
          the end of the calendar week preceding the Petition Date, and (b)
          specified as the interest rate allowed on judgments entered in federal
          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

               (2) such other rate per annum as the Bankruptcy Court determines
          is legally required by the applicable provisions of the Bankruptcy
          Code for accruals of post-petition interest on unsecured debt.

          The Holder of each Class 5 Subsidiary Debtor General Unsecured Claim
     shall have an election to accept either "85% Now Treatment" or "100%
     Stretch Treatment," as described in ensuing sentences in section 3.10 of
     the Plan. Such election shall be exercised by each such Holder (including
     Holders of Disputed Claims, whether or not the proceedings to determine the
     Allowed Amount of such Holder's Disputed Class 5 Subsidiary Debtor General
     Unsecured Claim shall have been concluded at the Effective Date), pursuant
     to election forms which will be mailed to each such Holder by Reorganized
     ADLT within five Cleveland, Ohio Business Days after the Effective Date,
     subject to the requirement that each Holder who fails to have made its
     election and to have caused its fully completed election form to have been
     actually received by the Reorganized Debtors by 5:00 p.m. Cleveland time on
     the 20th Cleveland, Ohio Business

                                       6


     Day after the Effective Date shall be conclusively deemed to have elected
     85% Now Treatment.

          Each Holder who shall have elected 85% Now Treatment (or who shall
     have been automatically deemed to have made such election) shall be
     entitled to receive on the later of:

               (1) 45 days after the Effective Date,

               (2) the date on which such Holder's Class 5 Subsidiary Debtor
          General Unsecured Claim shall have become Allowed,

               (3) the date on which such Class 5 Subsidiary Debtor General
          Unsecured Claim, or any portion thereof, shall be paid pursuant to the
          established ordinary course of business or dealings between ADLT and
          the Holder of such Claim, and

               (4) such other date agreed to by the Debtors or the Reorganized
          Debtors, as the case may be, and the Holder of such Class 5 Subsidiary
          Debtor General Unsecured Claim, an amount in Cash equal to 85% of the
          Allowed Amount of such Holder's Class 5 Subsidiary Debtor General
          Unsecured Claim.

          Holders who shall have elected 100% Stretch Treatment shall be
     entitled to receive, starting on the later of:

               (1) the first Calendar-Quarter-End Date after the Effective Date,
          and

               (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 5 Subsidiary Debtor General Unsecured Claim
          shall have become Allowed, and on each of the next succeeding
          Calendar-Quarter-End Dates thereafter, until such Allowed Class 5
          Subsidiary Debtor General Unsecured Claim is paid in full, an amount
          in Cash equal to 25% of the Allowed Amount of such Holder's Class 5
          Subsidiary Debtor General Unsecured Claim, plus interest accrued on
          such portion of such Allowed Claim from the Effective Date through the
          date of such payment calculated at a rate (a) equal to the weekly
          average 1-year constant maturity Treasury yield, as published by the
          Board of Governors of the Federal Reserve System for the end of the
          calendar week in which the Effective Date occurs, and (b) as specified
          as the interest rate allowed on judgments entered in federal courts
          pursuant to 28 U.S.C. ss.1961 and reported on the following site on
          the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 5
          Subsidiary Debtor General Unsecured Claim, except that Holders of
          Claims that shall have elected 100% Stretch Treatment remain Disputed
          Class 5 Subsidiary Debtor General Unsecured Claims on such 364th day
          shall be entitled to receive 100% of their Allowed Claim on the date
          of Allowance thereof.

                                       7


          All payments to Holders of Class 5 Subsidiary Debtor General Unsecured
     Claims shall be made in Cash, unless otherwise agreed between Reorganized
     ADLT and the Holder of such Claim.

o    Class 6 Interests: Old Preferred Stock Interests. Class 6 Preferred
     Interests are Impaired. Saratoga holds Class 6 Interests in 761,250 Old
     Preferred Shares; such Interests of Saratoga are hereby Allowed. On or as
     soon as practicable after the Effective Date, Saratoga, the Holder of the
     Allowed Class 6 Preferred Interest as of the Distribution Record Date shall
     receive, in full satisfaction, settlement, release, extinguishment and
     discharge of such Preferred Interest, and upon payment in Cash to ADLT by
     wire transfer of immediately available funds, $18,000,000, 29,000 shares of
     New Preferred Stock and 1,000 shares of New Common Stock, such that the
     Holders of the Allowed Class 6 Preferred Interests shall have received 100%
     of the authorized shares of New Preferred Stock, all of which are to be
     outstanding on the Effective Date and held by Saratoga, 100% of the shares
     of New Common Stock issued and outstanding on the Effective Date and 90.8%
     of the Fully Diluted New Common Stock. Acceptance of the Plan by Class 6
     shall, subject to consummation of the Plan, constitute an approval, as
     recipient of New Common Stock, of the Management Incentive Plan and the
     Senior Management Contracts.

o    Class 7 Interests: Old Common Stock Interests. Class 7 Common Interests are
     Impaired. If Class 7 accepts the Plan pursuant toss.1129(a)(8) of the
     Bankruptcy Code then, on or as soon as practicable after the Effective
     Date, each Holder of an Allowed Class 7 Interest as of the Distribution
     Record Date (and any Holders in Class 8, other than Saratoga, electing to
     exercise their rights as set forth in section 3.13 of the Plan) shall
     receive from the Disbursing Agent, in full satisfaction, settlement,
     release, extinguishment, cancellation and discharge of such Interest, for
     each share of Old Common Stock held by such Holder, the sum of $0.1197
     (11.97 cents) per share (based on 23,807,347 shares outstanding) payable
     such that the Holders of Class 7 Common Interests shall have received in
     the aggregate $2,850,000; provided, however, that the Cash distributions to
     be received by such Holders shall be reduced by the aggregate amount of
     Allowed Professional Claims of Professionals retained by or on behalf of
     the Equity Committee up to $350,000, such that, at a minimum, such Holders
     shall have received in the aggregate $2,500,000 (resulting in a Cash
     distribution of $0.105 (10.5 cents) per share of Old Common Stock (based on
     23,807,347 shares outstanding)). If Class 7 does not accept the Plan
     pursuant toss.1129(a)(8) of the Bankruptcy Code then they will be entitled
     to $2,500,000, pro rata, including Saratoga, payable in quarterly
     installments of 25% of the amount payable to such Holder starting, with
     respect to each Holder of a Class 7 Interest, on the later of (i) the first
     Calendar-Quarter-End Date after the Effective Date and (ii) the
     Calendar-Quarter-End Date next following the date on which each such Old
     Common Stock Interest shall have become Allowed, and on each of the next
     succeeding Calendar-Quarter-End Dates thereafter, until such Allowed Old
     Common Stock Interest is paid in full the amount provided for in Section
     3.12 of the Plan, subject to the proviso that on the 364th day after the
     Effective Date of the Plan, each such Holder shall receive the entire
     then-unpaid balance of the amount due under the Plan in respect of such
     Class 7 Interest, without interest. Regardless of the foregoing, Holders of
     Old Common Stock Interests that remain Disputed on such 364th day shall be
     entitled

                                       8


     to receive 100% of the amount due on their Allowed Interest on the date of
     Allowance thereof. All payments to Holders of Class 7 Old Common Stock
     Interests shall be made in Cash unless otherwise agreed between Reorganized
     ADLT and the Holder of such Interest. No interest will accrue or be payable
     on Class 7 Old Common Stock Interests or the payments made to Holders
     thereof.

o    Class 8 Interests: Old Other Interests. Class 8 Interests are Impaired.
     Each Holder of an Old Other Interest shall have the right to exercise its
     options, warrants, conversion privileges or other legal or contractual
     rights to obtain Old Common Stock representing such Interest, which shall
     become fully vested as of the date of exercise of such right
     notwithstanding any provision to the contrary in the contract or instrument
     giving rise to such Interest. To exercise such right, such Holder shall (i)
     mark or check off the applicable box on the Ballot cast by such Holder
     indicating such Holder's exercise of such right and (ii) on or before the
     Effective Date, pay all required consideration and otherwise satisfy all
     other applicable conditions in order to exercise such right. If such Holder
     timely exercises its right to obtain such Old Common Stock, such Holder
     shall be entitled to the treatment provided to Class 7 set forth in Section
     3.12 of the Plan with respect to such Old Common Stock. If such Holder
     fails to timely exercise its right to obtain such Old Common Stock, such
     Holder's Old Other Interest shall be canceled and extinguished and such
     Holder shall not receive or retain any property under the Plan on account
     of such Interest.

o    Class 9 Interests: Subsidiary Interests. Class 9 Interests are Unimpaired.
     Each Holder of an Interest in Class 9 shall retain such Interest and its
     respective share or shares of common stock of the Subsidiary Debtors
     representing such Interest, but such Holder shall receive no distribution
     under the Plan on account of such Interest; provided, however, that as soon
     as practicable after the Effective Date, the Reorganized Debtors shall
     cause Microsun, LRI and ADLT Services to be dissolved or merged into one of
     the other Debtors.

Board of Directors

         From and after the Effective Date, there will be seven (7) members of
Reorganized ADLT's Board of Directors: Wayne Hellman, Sabu Krishnan, Christian
Oberbeck, Damon Ball, Richard Petrocelli and two individuals appointed by
Saratoga in consultation with the Company's management. The Board of Directors
for each of the Subsidiary Debtors shall consist of one (1) or more members to
be appointed by Reorganized ADLT's Board of Directors. See "MANAGEMENT, BOARD OF
DIRECTORS AND INSIDER RELATIONSHIPS--BOARD OF DIRECTORS."

                                       9


Procedure for Approving the Plan

         Each Holder of an Impaired Claim or Impaired Interest entitled to vote
on the Plan will receive an appropriate ballot (each a "Ballot") for the purpose
of voting to accept or reject the Plan. Each such Holder that wishes to vote on
the Plan must (i) complete and execute its Ballot, (ii) check the box indicating
whether it votes in favor of or against the Plan, (iii) check the box indicating
whether it consents to the releases in the Plan, (iv) with respect to Holders of
Class 8 Old Other Interests, check the box indicating whether each such Holder
intends to exercise its existing options, warrants, conversion privileges or
other legal or contractual rights to obtain Old Common Stock representing such
Interests, and (v) return such Ballot in accordance with the instructions
contained therein so that it is received by the Voting Agent on or prior to the
Voting Termination Date. The Distribution Record Date for determining the
Holders of Claims or Interests entitled to (i) receive this Disclosure
Statement, the Plan, a Ballot and other solicitation materials, (ii) vote on the
Plan and (iii) receive distributions under the Plan is October 1, 2003. For a
discussion on voting on the Plan, see "THE PLAN--Voting on the Plan."

Expiration, Termination and Withdrawal

         The solicitation of your consent to the Plan will expire at 5:00 p.m.,
Pacific time on November 24, 2003 (the "Voting Termination Date"). Your consent
must be in writing on the Ballot and received by the Voting Agent no later than
the Voting Termination Date. Pursuant to Rule 3018 of the Federal Rules of
Bankruptcy Procedure (the "Bankruptcy Rules"), once you have voted to accept or
reject the Plan, you will need the approval of the Bankruptcy Court to withdraw
or change such acceptance or rejection.

Interpretation and Effect of Ballots

         The Debtors and Saratoga will decide any and all questions affecting
the validity of any Ballot submitted in connection with this Disclosure
Statement whose decision will be final and binding. The Debtors and Saratoga may
reject any Ballots that are not in proper form or that their counsel believes
would be unlawful or were submitted in bad faith. It is important that all
eligible Holders of Impaired Claims or Impaired Interests vote because, under
the Bankruptcy Code, for purposes of determining whether the requisite
acceptances of a particular Class have been received, only Holders in such Class
who actually vote will be counted. Accordingly, failure by a Holder to submit a
duly completed and signed Ballot will be deemed to constitute an abstention by
such Holder with respect to the vote on the Plan. Abstentions will not be
counted as votes for or against the Plan. Any Ballot which is otherwise properly
completed and executed except that it does not indicate an acceptance or
rejection of the Plan will be deemed to be an acceptance of the Plan.

                                       10


Objections to the Plan and this Disclosure Statement

         If confirmed by the Bankruptcy Court, the Plan will be binding upon all
Holders of Claims and Interests regardless of whether they have voted to accept
the Plan. The Bankruptcy Court has set a deadline for the filing of objections
to confirmation of the Plan (the "Confirmation Hearing Objection Deadline") for
November 24, 2003. Any objection to confirmation of the Plan must be in writing,
and

o    state the name and address of the objecting party and the amount of its
     Claim or the nature of its Interest held or asserted by it against the
     Debtors,

o    state with particularity the basis and nature of each objection, and

o    be filed with the Clerk of the Bankruptcy Court, together with proof of
     service thereof, and served upon the counsel for the Debtors and the other
     parties identified in the notice of the Confirmation Hearing accompanying
     this Disclosure Statement, so as to be received no later than the
     Confirmation Hearing Objection Deadline.

Only timely filed and served objections to confirmation of the Plan will be
considered by the Bankruptcy Court. Such objections are governed by Bankruptcy
Rule 9014.

         The Debtors will also seek an order from the Bankruptcy Court providing
that:

o    the failure of any person to file and serve timely objections to
     confirmation of the Plan shall preclude such person from objecting thereto;
     and

o    the Confirmation Hearing may be adjourned from time to time by the
     Bankruptcy Court without further notice except for the announcement of the
     adjournment date made at the Confirmation Hearing or at any subsequent
     adjourned Confirmation Hearing.

                                       11


Solicitation of Acceptances

         The Plan designates ten (10) Classes of Claims against, and Interests
in, the Debtors. We are soliciting acceptances of the Plan from the Holders of
Class 1(b) GE Secured Claims, Class 3 Old Note Claims, Class 4 ADLT General
Unsecured Claims, Class 5 Subsidiary Debtor General Unsecured Claims, Class 6
Preferred Interests, Class 7 Common Interests and Class 8 Old Other Interests.
All remaining Classes are or will be Unimpaired and deemed under the Bankruptcy
Code to have accepted the Plan (Classes 1(a), 2 and 9). If a Holder of a Class 8
Old Other Interest exercises its right to obtain Old Common Stock on account of
its Old Other Interest as provided in Section 3.13 of the Plan, such Holder
shall be entitled to the treatment provided to Class 7 in Section 3.12 of the
Plan with respect to such Old Common Stock. If such Holder fails to timely
exercise its right to obtain Old Common Stock, such Holder's Old Other Interest
shall be canceled and extinguished and such Holder shall not receive or retain
any property under the Plan on account of such Interest; in such event, pursuant
to section 1126(g) of the Bankruptcy Code, such Holder shall be conclusively
presumed to have rejected the Plan in respect of such Interest (even if such
Holder cast a Ballot accepting the Plan) because the Plan does not entitle the
Holders of such Interests to receive or retain any property under the Plan on
account of such Interests.

         Subject to consummation of the Plan, a vote in favor of the Plan will
also be deemed to constitute, among other things,

o    your consent to the releases set forth in the Plan (provided that you so
     indicate your consent on your Ballot),

o    if you are a Holder of an Old Note, your waiver of any and all defaults
     under the Old Indenture governing the Old Notes that may exist as of the
     Effective Date,

o    if you are a Holder of an Old Note, your agreement to instruct the Old
     Indenture Trustee to take all necessary actions to effectuate the Plan, and

o    your approval of the Management Incentive Plan and the Senior Management
     Contracts.

Voting Procedures

         For the Plan to be approved by the Bankruptcy Court, the Bankruptcy
Code requires, among other things, that it be accepted by (a) with respect to
each Impaired Class of Claims entitled to vote on the Plan, (i) the Holders of
Claims holding at least two-thirds (2/3) in amount of such Claims actually
voting in such Class (other than Claims held by any Holder designated pursuant
to section 1126(e) of the Bankruptcy Code) and (ii) more than one-half (1/2) in
number of the Holders of such Claims actually voting in such Class (other than
Claims held by any Holder designated pursuant to section 1126(e) of the
Bankruptcy Code); and (b) with respect to each Impaired Class of Interests
entitled to vote on the Plan, we must receive approval from the Holders of such
Interests holding at least two-thirds (2/3) in amount of such Interests actually
voting in such Class (other than Interests held by any Holder designated
pursuant to section 1126(e) of the Bankruptcy Code). Because only votes cast for
or against the Plan are counted, a failure to vote will not be counted, and it
is therefore possible that we may obtain the necessary acceptances of the Plan
by the votes of (a) Holders of Claims in each Impaired Class holding

                                       12


substantially less than two-thirds (2/3) of the aggregate amount of such Claims
and (b) substantially less than one-half (1/2) in number of all such Holders in
such Class. See "THE PLAN--Voting on the Plan." We reserve the right to request
that the Bankruptcy Court confirm the Plan in accordance with section 1129(b) of
the Bankruptcy Code, notwithstanding the requirements of section 1129(a)(8)
thereof, on the basis that the Plan is fair and equitable, and does not
discriminate unfairly, with respect to each Class of Claims or Interests that is
Impaired under, and has not accepted, the Plan.

Unimpaired Classes

         The following Classes of Claims and Interests are Unimpaired under the
Plan, and pursuant to section 1126(f) of the Bankruptcy Code, are conclusively
deemed to have accepted the Plan without the necessity of a formal solicitation
of the members of such Classes:

               Class 1(a)--Miscellaneous Secured Claims

               Class 2--Classified Priority Claims

               Class 9--Subsidiary Interests

Voting Impaired Classes

         The following Classes of Claims and Interests are Impaired under the
Plan, are entitled to vote on the Plan and from whom the formal solicitation of
acceptances is required:

               Class 1(b)--GE Secured Claims

               Class 3--Old Note Claims

               Class 4--ADLT General Unsecured Claims

               Class 5--Subsidiary Debtor General Unsecured Claims

               Class 6--Preferred Interests

               Class 7--Common Interests

               Class 8--Old Other Interests

         If a Holder of a Class 8 Old Other Interest exercises its right to
obtain Old Common Stock on account of its Old Other Interest as provided in
Section 3.13 of the Plan, such Holder shall be entitled to the treatment
provided to Class 7 in Section 3.12 of the Plan with respect to such Old Common
Stock. If such Holder fails to timely exercise its right to obtain Old Common
Stock, such Holder's Old Other Interest shall be canceled and extinguished and
such Holder shall not receive or retain any property under the Plan on account
of such Interest; in such event, pursuant to section 1126(g) of the Bankruptcy
Code, such Holder shall be conclusively presumed to have rejected the Plan in
respect of such Interest (even if such Holder cast a Ballot accepting the Plan)
because the Plan does not entitle the Holders of such Interests to receive or
retain any property under the Plan on account of such Interests.

         Section 1129(a)(10) of the Bankruptcy Code provides that if any classes
of claims are impaired under a plan, the plan cannot be confirmed unless at
least one of such impaired classes of claims has voted to accept the plan
(without counting any acceptance of the plan by any

                                       13


insiders). Accordingly, the affirmative vote of Class 1(b), Class 3, Class 4 or
Class 5 is necessary for confirmation of the Plan.

         Although the Interests of the Holders of Class 6 Preferred Interests,
the Holders of Class 7 Common Interests and the Holders of Class 8 Old Other
Interests are Impaired under the Plan and such Holders will receive a
distribution under the Plan, the requirement of section 1129(a)(10) of the
Bankruptcy Code cannot be met by the affirmative vote of a class of equity
interests.

Summary of Distributions Under the Plan

         All Holders of Allowed Claims will be paid in full (except that Holders
of General Unsecured Claims in Classes 4 and 5 (including the Holder of the
Class 1(b) GE Secured Claims, to the extent that after giving effect to the
offset provided in Section 3.06(b) of the Plan, such Holder has any remaining
Claims against the Debtors; such Claims shall be treated as Class 5 Subsidiary
Debtor General Unsecured Claims) may elect to receive alternative treatment) in
Cash either on the Effective Date or in installments over time, plus interest
accruing after the Effective Date (or on such other terms as the Holders of
these Claims and we may agree) or their contractual rights will be Reinstated
and any defaults cured, in accordance with section 1124(2) of the Bankruptcy
Code. The Holders of the Class 7 Common Interests will have their Old Common
Stock canceled and will receive Cash distributions pursuant to Section 3.12 of
the Plan. If a Holder of a Class 8 Old Other Interest exercises its right to
obtain Old Common Stock on account of its Old Other Interest as provided in
Section 3.13 of the Plan, such Holder shall be entitled to the treatment
provided to Class 7 in Section 3.12 of the Plan with respect to such Old Common
Stock. If such Holder fails to timely exercise its right to obtain Old Common
Stock, such Holder's Old Other Interest shall be canceled and extinguished and
such Holder shall not receive or retain any property under the Plan on account
of such Interest; in such event, pursuant to section 1126(g) of the Bankruptcy
Code, such Holder shall be conclusively presumed to have rejected the Plan in
respect of such Interest (even if such Holder cast a Ballot accepting the Plan)
because the Plan does not entitle the Holders of such Interests to receive or
retain any property under the Plan on account of such Interests.

         On the Effective Date, Saratoga shall receive 100% of the shares of the
New Preferred Stock and 100% of the shares of the New Common Stock. Saratoga's
ownership percentage of the New Common Stock shall be subject to dilution in
respect of the Management Options granted to certain members of Senior
Management pursuant to the Management Incentive Program. The issuance of New
Common Stock pursuant to the Management Options will result in percentage
ownership of New Common Stock as follows:

                                                             Pro Forma Assuming
         Class                                                 Recapitalization
         -----                                               ------------------
         Saratoga .....................................               90.8%

         Certain Members of Senior Management .........                9.2%

                                       14


Certain Consequences of the Plan

         Consequences of Failure to Confirm the Plan

         If we do not receive sufficient acceptances of the Plan to complete the
Recapitalization, we believe that our ability to reorganize in the Chapter 11
Cases will be materially and adversely affected. In that event, we may be forced
to sell some or all of our business operations, convert the Chapter 11 Cases to
cases under Chapter 7 of the Bankruptcy Code or propose a different plan of
reorganization, any of which could result in significantly less recovery for the
Holders of Claims and Interests than proposed in the Plan.

         Consequences of the Recapitalization

         If the Plan is approved and the Recapitalization is completed, you will
no longer have a debt claim against the Company, unless your Claim is Reinstated
or you receive a New Note.

Federal Income Tax Considerations

         The Plan will have tax effects on the Holders of Claims against, or
Interests in, the Debtors. The Plan will also have important tax effects on the
Debtors. For a discussion of these the tax consequences of the Plan, see
"FEDERAL INCOME TAX CONSIDERATIONS" below.

Description of Capital Stock and New ADLT Articles of Incorporation and Code of
Regulations (By-Laws)

         The rights, privileges, preferences and voting of the New Common Stock
will be substantially identical to the Old Common Stock. Each share of New
Common Stock will have one vote on all matters on which stockholders are
entitled or permitted to vote, including the election of directors, and will be
entitled to share ratably in dividends declared by the Board of Directors out of
funds legally available therefor. We do not expect to declare or pay Cash
dividends to Holders of our Old Common Stock or New Common Stock in the
foreseeable future. See "DESCRIPTION OF CAPITAL STOCK AND NEW ARTICLES OF
INCORPORATION AND CODE OF REGULATIONS (BY-LAWS)."

         If the Plan is approved and confirmed by the Bankruptcy Court, we will
cancel all shares of Old Common Stock outstanding on the Effective Date and
substitute therefor certain Cash distributions as provided in the Plan. We also
shall issue shares of New Preferred Stock and New Common Stock to Saratoga as
well as New Common Stock to certain members of Senior Management as provided in
the Management Incentive Program to be adopted pursuant to the Plan.

Listing and Trading of Old Notes, New Notes, Old Common Stock and New Common
Stock

         The Old Notes are not listed on any national or regional exchange or
included in The Nasdaq Stock Market(R) ("Nasdaq"). The Old Notes trade on a
limited basis in the over-the-counter market. Trading in the Old Notes is
limited and, if applicable, you are encouraged to obtain current information on
the market price of the Old Notes that you may hold.

                                       15


         The Old Common Stock was delisted from Nasdaq on January 10, 2003 and
is currently traded on the Over-the-Counter Bulletin Board under the symbol
"ADLTQ.OB." See "RISK FACTORS--Risks Related to Ownership of New Common Stock."
The reported closing price of the Old Common Stock on June 30, 2003 was $0.09
per share. On the Effective Date, Reorganized ADLT will deregister as a
registered issuer of equity securities under ss.12(g) of the Exchange Act and
will not list the New Common Stock in any public market. Periodic reporting to
the Commission will be governed by the New Indenture for the New Notes and
related regulations.

Voting Agent

         Bankruptcy Management Corporation will act as Voting Agent (the "Voting
Agent") for the Recapitalization. All correspondence and all inquiries relating
to the Recapitalization and Ballot should be sent to the Voting Agent at the
address and telephone number set forth on the back cover page of this document.

Board Recommendation

         Our Board of Directors has unanimously approved the terms of the Plan
and believes that it is in our best interests. The Board of Directors, as well
as Saratoga, strongly urges you to vote in favor of the Plan. However, you must
make your own decision as to whether to vote in favor of the Plan.

Selected Financial Data

         The following table contains certain selected financial data derived
from ADLT's Condensed Consolidated Financial Statements (Unaudited) for the
indicated periods as reported in our Quarterly Report on Form 10-Q for the third
fiscal quarter ended March 31, 2003. ADLT's Consolidated Financial Statements
include results for the Subsidiary Debtors and other subsidiaries and equity
investees. This information is qualified by the more detailed Consolidated
Financial Statements and Notes thereto of the Company. The selected financial
data should be read in conjunction with the Consolidated Financial Statements
and Notes thereto and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" included in such Quarterly Report. Later
financial information that we may file with the SEC will automatically update
and supersede this information.


                                       16


                      Advanced Lighting Technologies, Inc.

           Condensed Consolidated Statements of Operations (Unaudited)
                 (In thousands, except per share dollar amounts)


                                                 Three Months Ended        Nine Months Ended
                                                       March 31,                March 31,
                                               ---------------------      ---------------------
                                                 2003         2002          2003         2002
                                               ---------------------      ---------------------

                                                                           
Net sales                                      $37,469      $33,565       $109,624     $134,025
Costs and expenses
  Cost of sales                                 23,252       22,706         68,774       87,859
  Marketing and selling                          5,457        5,592         16,808       24,812
  Research and development                       2,055        1,529          6,321        6,863
  General and administrative                     2,628        3,602          8,934       11,857
  Provisions for loan impairment                     -          900          2,700        5,500
  Refinancing and non-recurring items               84            -          2,387            -
  Gain on settlement of lawsuit                      -            -              -         (554)
  Gain on sale of property                           -            -            (62)           -
  Special charges and asset impairment               -            -          6,714        9,009
  Amortization of intangible assets                 86           83            256          253
                                               -------     --------      ---------     --------
Income (loss) from operations                    3,907        (847)         (3,208)     (11,574)

Other income (expense):
  Interest expense                              (2,722)      (2,559)        (8,732)      (8,616)
  Interest income                                  140           82            415          144
  Income (loss) from investments                  (104)      (2,121)          (756)      (2,332)
  Reorganization expenses                       (3,963)           -         (3,963)           -
  Gain from sale of fixture subsidiaries             -            -              -          227
                                               -------     --------      ---------     --------

Income (loss) before income taxes,  minority
interest and cumulative effect of
accounting change                               (2,742)      (5,445)       (16,244)     (22,151)
Income tax expense                                 224          152            658          386
                                               -------      -------      ---------     --------

Income (loss) before minority interest and
cumulative effect of accounting change          (2,966)      (5,597)       (16,902)     (22,537)
Minority interest in income of
consolidated subsidiary                           (108)         (63)          (267)        (145)
                                               -------     --------      ---------     --------

Income (loss) before cumulative effect of
accounting change                               (3,074)      (5,660)       (17,169)     (22,682)
Cumulative effect of accounting change               -            -              -      (71,171)
                                               -------     --------      ---------     --------
                                                     -            -              -

Net income (loss)                              $(3,074)     $(5,660)      $(17,169)    $(98,853)
                                               -------     --------      ---------     --------

Earnings (loss) per share - basic and diluted:
  Income (loss) before cumulative effect
   of accounting change                          $(.16)       $(.27)         $(.90)      $(1.06)
  Cumulative effect of accounting change                                                  (3.04)
                                               -------    ---------      ---------     ---------
                                                     -            -             --

  Earnings (loss) per share - basic and          $(.16)       $(.27)         $(.90)      $(4.10)
   diluted:                                    -------     --------      ---------     --------
Weighted average shares outstanding:
  Basic and diluted                             23,807       23,462         23,733       23,383
                                               -------     --------      ---------     --------


                                       17



                      Advanced Lighting Technologies, Inc.
      Condensed Consolidated Statement of Shareholders' Equity (Unaudited)
                        Nine Months Ended March 31, 2003
                                 (in thousands)


                                                                                 Loan and
                                                                   Accumulated    Interest                 Common
                                     Common Stock                     Other     Receivable    Retained  Shareholders'
                     Preferred    -------------------   Paid-In   Comprehensive       From    Earnings         Equity
                         Stock     Shares   Par Value    Capital  Income (Loss)    Officer   (Deficit)      (Deficit)      Total
                     ---------    --------  ---------   --------  -------------    -------   ---------      ---------      -----
                                                                                              
Balance at
  July 1, 2002         $22,290    $23,588         $24   $214,804       $(2,940)    $(7,044)  $(201,562)        $3,282    $25,572
Net income
  (loss)                     -          -           -          -             -           -     (17,169)       (17,169)   (17,169)

Preferred shares
  accretion              2,185          -           -     (2,185)            -           -           -         (2,185)         -

Warrants to
  be issued
  to General
  Electric
  Company                    -          -          -           -             -           -           -              -          -
Reserve for
  loan impairment            -          -           -           -            -       2,700           -          2,700      2,700

Stock purchases
  by employees               -         61           -         20             -           -           -             20         20

Stock issued
  pursuant to
  employee benefit
  plan                       -        158           -         87             -           -           -             87         87

Foreign currency
translation
adjustment                   -          -           -          -           805                       -            805        805
                     ---------   --------      ------   --------     ---------    --------   ---------     ----------   --------
Balance at
March 31, 2002       $  24,475   $ 23,807      $   24   $212,726     $  (2,135)   $ (4,344)  $(218,731)    $  (12,460)  $ 12,015
                     =========   ========      ======   ========     ==========   ========   =========     ==========   ========





                                       18



                                  RISK FACTORS

         Eligible Holders of Claims and Interests should consider the factors
set forth below, as well as the other information set forth in this Disclosure
Statement or incorporated herein by reference, prior to determining whether to
vote to accept the Plan.

Risks if the Recapitalization is Not Successfully Completed

         If we do not complete the Recapitalization, we believe that our ability
to reorganize in the Chapter 11 Cases will be materially and adversely affected.
In that event, we may be forced to sell some or all of our business operations,
convert the Chapter 11 Cases to cases under Chapter 7 of the Bankruptcy Code or
propose a different plan of reorganization, any of which could result in
significantly less recovery for the Holders of Claims and Interests than
proposed in the Plan.

         We do not believe that we will be able to significantly improve our
financial position without completing the Recapitalization. Thus, if we do not
complete the Recapitalization through the Plan, we will have to consider other
alternatives, the results of which may be significantly less favorable to
Holders of Claims and Interests than the Recapitalization.

Risks Related to the Plan

         If we receive the requisite acceptances, we expect to complete the
Recapitalization. Completion of the Recapitalization may entail certain risks
for the Holders of Claims and Interests.

         Risk of Non-Confirmation of the Plan

         Section 1129 of the Bankruptcy Code, which sets forth the requirements
for confirmation of a plan of reorganization, requires, among other things, a
finding by a bankruptcy court that:

o    the  confirmation  of a plan is not likely to be  followed  by the need for
     further reorganization;

o    all  claims and  interests  have been  classified  in  compliance  with the
     provisions of section 1122 of the Bankruptcy Code; and

o    each holder of a claim or equity  interest  within each impaired  class has
     voted to accept the plan or has received or retained  under the plan,  cash
     or property of a value, as of the date the plan becomes effective,  that is
     not less than the value such holders  would receive or retain if the debtor
     were liquidated under Chapter 7 of the Bankruptcy Code.

         There can be no assurance that the Bankruptcy Court will conclude that
these tests and the other requirements of section 1129 of the Bankruptcy Code
have been met with respect to the Plan. There also can be no assurance that
modifications to the Plan would not be required for confirmation, or that such
modifications would not require a resolicitation of the Plan.

         We believe that the Plan meets all of the requirements for confirmation
thereof, including, in particular, that if the Plan is confirmed it will not be
followed by the need for further financial reorganization of the Debtors and
that the Holders of Impaired Claims and



                                       19



Impaired Interests will receive value under the Plan that is greater than the
value they would receive if we were liquidated under Chapter 7 of the Bankruptcy
Code. See "THE PLAN--Confirmation of the Plan." However, there can be no
assurance that the Bankruptcy Court will reach the same conclusions.

         The confirmation and effectiveness of the Plan are also subject to
certain conditions. No assurances can be given that these conditions will be
satisfied or waived or that any necessary consent will be obtained. See "THE
PLAN--Summary of Other Provisions of the Plan--Conditions to Effectiveness."

         Failure of confirmation of the Plan by the Bankruptcy Court would
likely result in a sale of some or all of our business operations, a conversion
of the Chapter 11 Cases to cases under Chapter 7 of the Bankruptcy Code or the
proposal of a different plan of reorganization. If we are ultimately unable to
complete the Recapitalization, there is a significant likelihood that Holders of
Impaired Claims and Impaired Interests would ultimately receive far less than
what they would receive under the terms of the Recapitalization.

Risks Related to Ownership of New Common Stock

         Although we believe that the Holders of the New Common Stock under the
Plan will be able to resell the New Common Stock without registration under the
Securities Act or other federal securities laws, such Holder's ability to sell
may be diminished if it is deemed to be an "underwriter" with respect to such
securities within the meaning of section 1145(b) of the Bankruptcy Code. Section
1145(b) of the Bankruptcy Code defines an "underwriter" for purposes of the
Securities Act as including a person who is a control person of the issuer of
the securities. We cannot assure that such Holders will not be deemed to be a
statutory underwriter and they are advised to consult with their own counsel as
to the availability of any exemptions under the Securities Act.

         Other Risks Relating to the Debtors and Their Businesses.

         There may be other risks associated with the future operation of the
Debtors' businesses and related matters. Some of these risk factors are
identified in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q,
which are incorporated by reference into this Disclosure Statement.

                                 CAPITALIZATION

         The following consolidated balance sheet of the Debtors is contained in
the Notes to the Company's Condensed Consolidated Financial Statements
(Unaudited) as reported in our Quarterly Report on Form 10-Q for the fiscal
quarter ended March 31, 2003. Later financial information that we may file with
the SEC will automatically update and supersede this information.



                                       20




          Condensed Consolidated Balance Sheet of Debtors-in-Possession
          (Unaudited)
          (Dollars in thousands)
          March 31, 2003

                                                                                              
                Current assets:
                  Cash and cash equivalents                                                      $  316
                  Trade receivables, net                                                         12,331
                  Receivables from subsidiaries not in bankruptcy                                17,716
                  Inventories                                                                     9,866
                  Other                                                                             740
                                                                                               --------
                    Total current assets                                                         40,969
                Property, plant and equipment, net                                               44,573
                Receivables from related parties                                                  7,747
                Investments in affiliates                                                         9,578
                Investments in and loans to subsidiaries not in bankruptcy                       72,151
                Long-term receivables from subsidiaries not in bankruptcy                        38,088
                Other assets                                                                      2,224
                                                                                               --------
                   Total assets                                                                $215,330
                                                                                               ========
                Liabilities:
                   Liabilities not subject to compromise
                      Debt                                                                     $ 19,789
                      Payables to subsidiaries not in bankruptcy                                 13,804
                      Other                                                                      11,255
                                                                                               --------
                          Total liabilities subject to compromise                                44,848
                Liabilities subject to compromise:
                   Debt                                                                          99,232
                   Other                                                                         15,325
                                                                                               --------
                     Liabilities subject to compromise                                          114,557
                                                                                               --------
                   Total liabilities                                                            159,406
                Preferred stock                                                                  24,476
                Shareholders' equity                                                             31,449
                                                                                              ---------
                   Total liabilities and equity                                               $ 215,330
                                                                                              =========




                 BANKRUPTCY SCHEDULES OF ASSETS AND LIABILITIES

         The Debtors filed their respective schedules of assets and liabilities
and consolidated statement of financial affairs with the Bankruptcy Court on
March 21, 2003. These schedules and statement of financial affairs are available
for review at the Office of the Clerk of the Bankruptcy Court or by contacting
the Debtors' counsel. A summary of the Debtors' respective assets and
liabilities is set forth below. The information set forth below is supplemented
and qualified by the Global Notes and Disclaimers Regarding Schedules of Assets
and Liabilities filed with the schedules and statement of financial affairs. The
information set forth below also will be superseded by any amended schedules or
statement of financial affairs that we may file with the Bankruptcy Court in the
future.

    Debtor                 Total Assets              Total Liabilities
    ------                 ------------              -----------------

    ADLT                    $243,220,340.59           $154,794,601.16

    VLI                     $ 78,244,707.62           $130,007,703.88



                                       21




    APL                     $ 56,834,756.53           $ 28,655,669.10

    Ballastronix            $    384,130.00           $ 28,661,429.00

    LRI                     $    525,074.00           $ 28,070,232.00

    Microsun                $          0.00           $ 44,236,894.00

    ADLT Services           $          0.00           $ 26,420,662.00

         To date in these Chapter 11 Cases, the Debtors have filed financial or
operating reports with the United States Trustee for the months of February
through June, 2003. These reports, along with all subsequent financial or
operating reports filed with the United States Trustee, are incorporated herein
by reference. Copies of these reports are available from the Clerk of the
Bankruptcy Court.

             COMPANY BACKGROUND AND PURPOSE FOR THE RECAPITALIZATION

The Company

         ADLT was formed on May 19, 1995, and acquired ownership, primarily by
merger, of affiliated companies, including the Subsidiary Debtors (other than
Ballastronix), that were previously under common ownership and management. ADLT
is an innovation-driven designer, manufacturer and marketer of metal halide
lighting products. ADLT believes that it is the only designer and manufacturer
in the world focused primarily on metal halide lighting. As a result of this
unique focus, ADLT has developed substantial expertise in all aspects of metal
halide lighting. ADLT believes that this focus enhances its responsiveness to
customer demand and has contributed to its technologically advanced product
development and manufacturing capabilities. Further information regarding ADLT
and its subsidiaries is set forth in our Annual Report on Form 10-K for the
fiscal year ended June 30, 2002, Quarterly Reports on Form 10-Q for fiscal
quarters ended September 30, 2002, December 31, 2002 and March 31, 2003, and
other filings with the SEC, which are incorporated by reference into this
Disclosure Statement.

Background of the Restructuring

         Prior to the Petition Date, ADLT had established certain revolving
credit facilities with a bank group headed by PNC Bank, N.A. (the "Prior
Lenders"). These prepetition credit facilities were secured by certain liens and
security interests granted by ADLT and other borrowers and guarantors upon such
parties' respective assets and property.

         On or about August 21, 2002, the Prior Lenders issued a notice of
default under the governing credit agreement as a result of the borrowers'
breach of certain financial covenants. Thereafter, on September 16, the
borrowers and the Prior Lenders entered into a forbearance agreement pursuant to
which the Prior Lenders agreed to forbear from exercising their rights and
remedies under the credit agreement based on the borrowers' prior financial
covenant defaults. The borrowers were allowed access to their credit facilities,
but not in amounts sufficient to enable ADLT to make a required $4 million
interest payment to the Holders of Old Notes on September 16, 2002.




                                       22



         On October 18, 2002, the borrowers and the Prior Lenders entered into
an amended forbearance agreement under which the Prior Lenders agreed to
continue making the prepetition credit facilities available to the borrowers,
provided that, among other things, ADLT retain a financial consultant to assist
in the refinance of the indebtedness owed to the Prior Lenders and an investment
banker to explore a possible sale of all or a significant portion of the
borrowers' assets in order to pay off the outstanding indebtedness to the Prior
Lenders. Throughout the fall of 2002, the borrowers sought to refinance the
obligations owing to the Prior Lenders.

         On or about January 7, 2003, the Prior Lenders declared the borrowers
to be in default under the amended forbearance agreement. The Prior Lenders then
advised the borrowers that (a) no further financing would be available after
February 5, 2003 outside of the Chapter 11 Cases, and (b) in no event prior to
February 5, 2003 would advances under the prepetition credit facilities exceed
the borrowing base thereunder. As a result, the borrowers determined that the
commencement of the Chapter 11 Cases with the support of a DIP facility offered
by the Prior Lenders was the surest way to preserve their businesses, assets and
going concern values.

         In response to ADLT's failure to make the scheduled interest payment in
September 2002, certain Holders of Old Notes formed an ad hoc committee to
negotiate with ADLT to restructure its capital structure or otherwise resolve
the situation. On January 22, 2003, the Old Indenture Trustee accelerated the
Old Notes.

         Prior to the Petition Date, ADLT and an ad hoc committee of Holders of
Old Notes engaged in restructuring negotiations. After the Petition Date, ADLT
continued negotiations with the Creditors Committee, which was and is dominated
by Holders of Old Notes, and GE, ADLT's former preferred shareholder.
Thereafter, the Debtors reached an agreement in principle with the Creditors
Committee and GE regarding the terms of a consensual joint plan and commenced
working on a joint plan, disclosure statement and related plan documents.
Indeed, on more than one occasion the Debtors advised the Court that the Debtors
had reached an agreement with the Creditors Committee and GE and intended to
seek confirmation of the joint plan. However, on August 15, 2003, GE sold its
equity interests to Saratoga, which was not interested in pursuing the joint
plan. On August 15, 2003, the Debtors and Saratoga, as co-Proponents, filed the
Plan with the Bankruptcy Court.

Our Management Team

         Our current executive management team consists of the following
individuals:

          Wayne R. Hellman is ADLT's Chief Executive Officer and serves as
President of ADLT Services, Ballastronix, LRI and Microsun. He also is Chairman
of ADLT's current Board of Directors and is the sole member of the Board of
Directors of each of the Subsidiary Debtors. Mr. Hellman has served as the Chief
Executive Officer of the Company since 1995 and as chief executive or other
senior officer of each of the Company's predecessor companies since 1983. From
1968 to 1983, Mr. Hellman was employed by the lighting division ("GE Lighting")
of GE. While at GE Lighting, Mr. Hellman served as Manager of Strategy Analysis
for the Lighting Business Group; Manager of Engineering for the Photo Lamp
Department; Halarc Project Venture Manager; Manager of Quartz Halogen
Engineering and Manager of Metal Halide Engineering. As the Halarc Project
Venture Manager, Mr. Hellman was given the responsibility of developing metal
halide technology. He is also currently a director of Fiberstars, Inc., a




                                       23



manufacturer and marketer of fiber optic lighting systems. The Company owns
approximately 20% of the issued and outstanding shares of Fiberstars, Inc. In
1998, Mr. Hellman married Diane Mazzola, who is director Louis S. Fisi's
step-daughter.

         Steven C. Potts is the Chief Financial Officer, Treasurer and Secretary
of ADLT, ADLT Services, Ballastronix, LRI and Microsun. He also serves as Vice
President and Chief Financial Officer of APL and as Secretary and Treasurer of
VLI. Mr. Potts has served as Chief Financial Officer and Treasurer since
October, 2000. Mr. Potts served as a director of the Company from January 22,
2002 until his resignation on May 29, 2002. Before joining the Company, Mr.
Potts served in several financial positions for General Dynamics, Inc., from
1975 until 1999. From 1995 to 1999, Mr. Potts served as Vice President of
Finance and Controller of General Dynamics, Land Systems Division. In this
position, Mr. Potts was responsible for directing financial operations and
information resource management for Land Systems and played a key role in
domestic and international acquisitions for General Dynamics. Mr. Potts is
currently scheduled to leave the Company at or about the time his replacement
joins the Company.

         Sabu Krishnan is ADLT's Chief Operating Officer. Mr. Krishnan was
elected to the office of Chief Operating Officer on February 13, 2003 and serves
as President of VLI. Mr. Krishnan was appointed a Director of ADLT on April 22,
2003. Mr. Krishnan joined VLI in 1995 and has served in management positions of
increasing responsibility at VLI. Mr. Krishnan's primary recent responsibility
has been the successful launch of the Company's Indian manufacturing operations
in both lamps and power supplies.

         Leroy Bartolomei is a Vice President of ADLT and serves as President of
non-debtor DSI. Mr. Bartolomei was elected as an executive officer of the
Company on January 22, 2002. Mr. Bartolomei has been President of DSI since its
formation in 1985. Prior to that, Mr. Bartolomei was employed by Optical Coating
Laboratory, Inc., where his last position was Senior Vice President of
Operations. Mr. Bartolomei holds several patents for thin film components and
processing.

         James L. Schoolenberg is a Vice President of ADLT and serves as Chief
Executive Officer and President of APL. Mr. Schoolenberg was elected as an
executive officer of the Company on January 22, 2002. Mr. Schoolenberg joined
APL in 1975 and has served as President and Chief Executive Officer of APL since
1994. He holds a Bachelor of Arts degree with majors in Physics and Chemistry.
Prior to joining APL, Mr. Schoolenberg was a faculty member of the Physics
Department at Western Michigan University. Mr. Schoolenberg was responsible for
the development of numerous new techniques and procedures improving the
efficiency of production runs and the quality of APL's metal halide products.

         Wayne Platt is an Executive Vice President of ADLT. Mr. Platt was
elected as an executive officer of the Company on January 22, 2002. Mr. Platt
joined VLI in 1998, and previously served as President of VLI. From 1996 to
1997, he served as Vice President of Manufacturing and Engineering of Sylvania
Lighting International in Geneva, Switzerland. Prior to that, he served for
eight years as Plant Manager of the High Intensity Discharge division of Osram
Sylvania in New Hampshire.




                                       24



Purpose of the Recapitalization

         The Recapitalization and the Plan is based on the restructuring
agreement between the Debtors and Saratoga. We believe that the proposed
Recapitalization most fairly provides for all creditors and equity security
holder constituencies. Upon completion of the Recapitalization, we believe that
we will be able to grow our businesses and provide enhanced value for our
stockholders.

                  VALUATION AND PROJECTED FINANCIAL INFORMATION

Valuation Analysis

         To assist Holders of Claims and Interests in determining whether to
accept (or reject) the Plan, our financial advisor, Brown Gibbons Lang & Company
Securities, Inc. ("BGL"), has prepared a valuation analysis of the Debtors and
the value, if any, of the Class 7 and Class 8 Interests (the "Equity
Valuation").

         In preparing the Equity Valuation, BGL relied on, among other things,
the financial projections prepared by our management and reviewed by our other
financial advisor, The Parkland Group, Inc. ("Parkland"). BGL's valuation
assumes that the operating results projected by us will be achieved in all
material respects, including revenue growth, improvements in operating margins,
earnings and cash flow, improvement in techniques for managing working capital,
expenses and other elements. Certain projected results may differ materially
from our historical operations results, and no assurance can be given that the
projected results will be achieved.

         In the Equity Valuation, BGL has concluded that, in its opinion, the
Holders of Claims and Interests will receive under the Plan property of a value
as of the Effective Date of the Plan, equal to or greater than the value of such
Claim or Interest. Among other things, BGL has concluded that the value of the
Interests of Class 7 (Holders of Old Common Stock) and Class 8 (Holders of Old
Other Interests) is zero.

Projected Financial Information

         Our management has prepared and Parkland has reviewed financial
projections that may be helpful to the Holders of Impaired Claims and Impaired
Interests in deciding whether to accept or reject the Plan. These financial
projections, and the assumptions upon which they are based, are contained in
Annex B to this Disclosure Statement.

         WE CAUTION THAT NO REPRESENTATION CAN BE MADE CONCERNING THE ACCURACY
OF THE PROJECTED FINANCIAL INFORMATION OR THE ABILITY TO ACHIEVE THE PROJECTED
RESULTS. MANY OF THE ASSUMPTIONS ON WHICH THESE PROJECTIONS ARE BASED ARE
SUBJECT TO SIGNIFICANT ECONOMIC AND COMPETITIVE UNCERTAINTIES. IT IS LIKELY THAT
SOME ASSUMPTIONS WILL NOT MATERIALIZE BECAUSE OF UNANTICIPATED EVENTS AND
CIRCUMSTANCES. ACCORDINGLY, THE ACTUAL RESULTS ACHIEVED THROUGHOUT THE
PROJECTION PERIOD ARE



                                       25



LIKELY TO VARY FROM THE PROJECTED RESULTS. THE VARIATIONS MAY BE MATERIAL,
ADVERSE OR POSITIVE.

                                    THE PLAN

         We are soliciting acceptances of the Plan so that we may complete the
Recapitalization through the Debtors' bankruptcy proceedings. To complete the
Recapitalization through the Plan, we must receive acceptances of the Plan from
(a) with respect to each Impaired Class of Claims entitled to vote on the Plan,
(i) the Holders of Claims holding at least two-thirds (2/3) in amount of such
Claims actually voting in such Class (other than Claims held by any Holder
designated pursuant to section 1126(e) of the Bankruptcy Code) and (ii) more
than one-half (1/2) in number of the Holders of such Claims actually voting in
such Class (other than Claims held by any Holder designated pursuant to section
1126(e) of the Bankruptcy Code); and (b) with respect to each Impaired Class of
Interests entitled to vote on the Plan, we must receive approval from the
Holders of such Interests holding at least two-thirds (2/3) in amount of such
Interests actually voting in such Class (other than Interests held by any Holder
designated pursuant to section 1126(e) of the Bankruptcy Code) (the "Requisite
Acceptances"). Because only those Holders who vote to accept or reject the Plan
will be counted for purposes of determining acceptance or rejection of the Plan,
the Plan could be approved by the affirmative vote of (a) Holders holding
significantly less than two-thirds (2/3) of the aggregate amount of Claims in
each Class and (b) significantly less than one-half (1/2) in number of the
Holders in such Class. See "--Brief Explanation of Chapter 11 Reorganization,"
below. We reserve the right to request that the Bankruptcy Court confirm the
Plan in accordance with section 1129(b) of the Bankruptcy Code, notwithstanding
the requirements of section 1129(a)(8) thereof, on the basis that the Plan is
fair and equitable, and does not discriminate unfairly, with respect to each
Class of Claims or Interests that is Impaired under, and has not accepted, the
Plan.

         A COPY OF THE PLAN IS ATTACHED TO THIS DISCLOSURE STATEMENT AS ANNEX A
AND IS INCORPORATED HEREIN BY REFERENCE. THE FOLLOWING IS A SUMMARY OF THE
MATERIAL PROVISIONS OF THE PLAN. YOU SHOULD CAREFULLY READ THE PLAN IN ITS
ENTIRETY FOR A FULL UNDERSTANDING OF ITS TERMS.

Brief Explanation of Chapter 11 Reorganization

         Chapter 11 of the Bankruptcy Code is the principal business
reorganization chapter of the Bankruptcy Code. Under Chapter 11, a debtor is
authorized to reorganize its business for the benefit of itself and its
creditors and stockholders. In addition to permitting rehabilitation of the
debtor, another goal of Chapter 11 is to promote equality of treatment of
creditors and equity security holders of equal rank with respect to the
distribution of a debtor's assets. In furtherance of these two goals, upon the
filing of a petition for reorganization under Chapter 11, section 362 of the
Bankruptcy Code generally provides for an automatic stay of substantially all
acts and proceedings against the debtor and its property, including all attempts
to collect claims or to enforce liens that arose prior to the commencement of
the debtor's case under Chapter 11.

         Approval and confirmation of a plan of reorganization by a bankruptcy
court is the principal objective of a Chapter 11 case. In general, a Chapter 11
plan of reorganization:




                                       26



o    divides claims and equity interests into separate classes;

o    specifies the property that each class is to receive under the plan; and

o    contains other provisions necessary or desirable for the reorganization of
     the debtor.

         In general, there are two forms of treatment that may be provided to a
holder of a claim or equity interest under a chapter 11 plan of reorganization
- -- "unimpaired" treatment and "impaired" treatment. Unimpaired treatment means
that the legal, equitable and contractual rights of a holder of a claim or
equity interest are unchanged under the plan. Impaired treatment means that the
legal, equitable or contractual rights of a holder of a claim or equity interest
are somehow changed under the plan and can include situations where a holder of
a claim or equity interest does not receive or retain any property under a plan.

         In Chapter 11, the right to vote on a plan of reorganization is
determined by the treatment that a particular holder of a claim or equity
interest receives under the plan. If the holder of a claim or equity interest is
unimpaired under a plan, the holder is deemed to accept the plan and it is
therefore unnecessary to solicit such holder's vote on the plan. Similarly, it
is not necessary to solicit a vote from a holder of a claim or equity interest
who is not entitled to receive or retain any property under a plan and such
holder is deemed to reject the plan under the Bankruptcy Code. However, if an
impaired holder of a claim or equity interest is entitled to receive property
under the plan, then such holder is not deemed to automatically accept or reject
the plan.

         Chapter 11 of the Bankruptcy Code, however, does not require each
holder of a claim or equity interest in a voting class to vote in favor of a
plan of reorganization in order for a bankruptcy court to confirm the plan.
Instead, in order for a particular class to accept a plan, acceptances must be
received:

o    if such class is a class of claims against a debtor, from the holders of
     claims constituting at least two-thirds (2/3) in amount of the allowed
     claims actually voted in such class and more than one-half (1/2) in number
     of the holders of allowed claims in such class, or

o    if such class is a class of equity interests in a debtor, from the holders
     of at least two-thirds (2/3) in amount of the allowed equity interests in
     such class of equity interests that have actually voted to accept or reject
     the plan.

         In addition to the voting requirements described above, the bankruptcy
court must also find that the plan of reorganization meets a number of statutory
tests before the court may confirm (approve) the plan of reorganization. Many of
these tests are designed to protect the interests of holders of claims or equity
interests who do not vote to accept the plan of reorganization but who will
nonetheless be bound by the plan's provisions if it is confirmed by the
bankruptcy court. See "--Confirmation of the Plan," "--Feasibility Test" and
"--Best Interests of Creditors Test; Liquidation Value," below.

Solicitation of Acceptances of the Plan

         Under the Plan, Class 1(a) (Miscellaneous Secured Claims), Class 2
(Classified Priority Claims) and 9 (Subsidiary Interests) are Unimpaired.
Accordingly, as discussed above, such



                                       27



Classes are deemed to have accepted the Plan and the solicitation of votes on
the Plan from the Holders in such Classes is not necessary. As such, we will not
solicit any votes on the Plan from any Holders in these Classes. The Holders of
Claims or Interests in Class 1(b) (GE Secured Claims), Class 3 (Old Note
Claims), Class 4 (ADLT General Unsecured Claims), Class 5 (Subsidiary Debtor
General Unsecured Claims), Class 6 (Preferred Interests), Class 7 (Common
Interests) and Class 8 (Old Other Interests) are not deemed to have
automatically accepted or rejected the Plan and are Impaired and entitled to
receive property under the Plan. We intend to seek to solicit acceptances of the
Plan from these Classes of Claims and Interests. If a Holder of a Class 8 Old
Other Interest exercises its right to obtain Old Common Stock on account of its
Old Other Interest as provided in Section 3.13 of the Plan, such Holder shall be
entitled to the treatment provided to Class 7 in Section 3.12 of the Plan with
respect to such Old Common Stock. If such Holder fails to timely exercise its
right to obtain Old Common Stock, such Holder's Old Other Interest shall be
canceled and extinguished and such Holder shall not receive or retain any
property under the Plan on account of such Interest; in such event, pursuant to
section 1126(g) of the Bankruptcy Code, such Holder shall be conclusively
presumed to have rejected the Plan in respect of such Interest (even if such
Holder cast a Ballot accepting the Plan) because the Plan does not entitle the
Holders of such Interests to receive or retain any property under the Plan on
account of such Interests.

         Subject to the occurrence of the Effective Date, a vote in favor of the
Plan will be deemed to constitute, among other things, (a) your consent to the
releases set forth in the Plan (provided that you so indicate your consent on
your Ballot), (b) if you are a Holder of an Old Note, your waiver of any and all
defaults under the Old Indenture governing the Old Notes that may exist as of
the Effective Date, (c) if you are a Holder of an Old Note, your agreement to
instruct the Old Indenture Trustee to take all necessary actions to effectuate
the Plan and (d) your consent to the Management Incentive Plan and the Senior
Management Contracts.

         Section 1125(a) of the Bankruptcy Code defines "adequate information"
as information of a kind, and in sufficient detail, as far as is reasonably
practicable in light of the nature and history of a company and the condition of
such company's books and records, that would enable a hypothetical reasonable
investor typical of holders of claims or equity interests of the relevant class
to make an informed judgment about the plan of reorganization. To the extent the
solicitation of votes on the Plan is deemed to constitute an offer of the New
Notes, the New Preferred Stock or the New Common Stock, we are relying on
section 3(a)(9) of the Securities Act of 1933 as amended (the "Securities Act")
and similar provisions under state securities laws to exempt such offer from
registration under the Securities Act and applicable state securities laws.
Although the solicitation of votes under the Plan is not governed by Regulation
14A promulgated under the Exchange Act, we have nevertheless included in this
Disclosure Statement the material information that would be required in a
Regulation 14A solicitation. We believe that this Disclosure Statement contains
adequate information for Holders to cast an informed vote to accept or reject
the Plan and that this Disclosure Statement and the solicitation of acceptances
comply with applicable provisions of the Bankruptcy Code (including sections
1125(a) and 1126(b)), the Bankruptcy Rules (including Rule 3018) and
non-bankruptcy law, to the extent applicable. We also believe that properly
executed Ballots comply with the applicable provisions of the Bankruptcy Code
and Bankruptcy Rules concerning plan acceptances.

         This Disclosure Statement, together with the Plan, is being transmitted
to all known Holders of Class 1(b) GE Secured Claims, Class 3 Old Note Claims,
Class 4 ADLT General



                                       28



Unsecured Claims, Class 5 Subsidiary Debtor General Unsecured Claims, Class 6
Preferred Interests, Class 7 Common Interests and Class 8 Old Other Interests.

         IF THE PLAN IS CONFIRMED BY THE BANKRUPTCY COURT, EACH HOLDER OF CLAIMS
OR INTERESTS WILL RECEIVE THE SAME CONSIDERATION AS OTHER HOLDERS OF CLAIMS OR
INTERESTS IN SUCH HOLDER'S CLASS (UNLESS, IF APPLICABLE, SUCH HOLDER ELECTS
LESSER, ALTERNATIVE TREATMENT), WHETHER OR NOT SUCH HOLDER VOTED TO ACCEPT THE
PLAN. MOREOVER, UPON CONFIRMATION, THE PLAN WILL BE BINDING UPON ALL HOLDERS OF
CLAIMS AND INTERESTS REGARDLESS OF WHETHER OR NOT SUCH HOLDERS VOTED TO ACCEPT
THE PLAN.

Voting on the Plan

         As more fully described above, only certain impaired classes of claims
and equity interests are entitled to vote on a plan of reorganization. The Plan
designates ten (10) separate Classes of Claims and Interests. We are soliciting
the votes of Class 1(b) (GE Secured Claims), Class 3 (Old Note Claims), Class 4
(ADLT General Unsecured Claims), Class 5 (Subsidiary Debtor General Unsecured
Claims), Class 6 (Preferred Interests), Class 7 (Common Interests) and Class 8
(Old Other Interests). We are not soliciting the vote of any of the remaining
three (3) Classes because such Classes are Unimpaired and deemed to accept the
Plan.

         The solicitation of acceptances of the Plan will expire on November 24,
2003. Acceptances and rejections of the Plan may not be revoked or changed
without permission of the Bankruptcy Court upon a showing of cause, as provided
in Bankruptcy Rule 3018(a).

         As previously stated, the Plan must be accepted by (a) with respect to
each Impaired Class of Claims entitled to vote on the Plan, (i) the Holders of
Claims holding at least two-thirds (2/3) in amount of such Claims actually
voting in such Class (other than Claims held by any Holder designated pursuant
to section 1126(e) of the Bankruptcy Code) and (ii) more than one-half (1/2) in
number of the Holders of such Claims actually voting in such Class (other than
Claims held by any Holder designated pursuant to section 1126(e) of the
Bankruptcy Code); and (b) with respect to each Impaired Class of Interests
entitled to vote on the Plan, we must receive approval from the Holders of such
Interests holding at least two-thirds (2/3) in amount of such Interests actually
voting in such Class (other than Interests held by any Holder designated
pursuant to section 1126(e) of the Bankruptcy Code). Because only those Holders
who vote to accept or reject the Plan will be counted for purposes of
determining acceptance or rejection of the Plan, the Plan could be approved by
the affirmative vote of (a) Holders holding significantly less than two-thirds
(2/3) of the aggregate amount of Claims in each Class and (b) significantly less
than one-half (1/2) in number of the Holders in such Class. We reserve the right
to request that the Bankruptcy Court confirm the Plan in accordance with section
1129(b) of the Bankruptcy Code, notwithstanding the requirements of section
1129(a)(8) thereof, on the basis that the Plan is fair and equitable, and does
not discriminate unfairly, with respect to each Class of Claims or Interests
that is Impaired under, and has not accepted, the Plan.

         The Debtors and Saratoga reserve the right to amend the terms of the
Plan or waive any conditions thereto in accordance with the terms of the Plan if
and to the extent the Debtors and Saratoga, acting jointly, determine that such
amendments or waivers are necessary or desirable in



                                       29



order to consummate the Plan. As provided in the Plan, we will give Holders of
Claims and Interests notice of such amendments or waivers as may be required by
applicable law. The Debtors and Saratoga further reserve the right to use
acceptances of the Plan to confirm any amendment of the Plan so long as such
amendment does not materially and adversely affect the rights of the Class of
Holders of Claims or Interests under the Plan whose acceptances we seek to use.

Classifications of Claims and Interests

         Section 1123 of the Bankruptcy Code provides that a plan of
reorganization must classify claims against and equity interests in a debtor.
Under section 1122 of the Bankruptcy Code, a plan must classify each right to
payment against the debtor and each right to an equitable remedy for breach of
performance which gives rise to a right to payment (collectively, a "Claim") and
any interest in the debtor represented by an equity security (an "Interest")
into a category or class (a "Class") that contains substantially similar Claims
and Interests. The Plan divides the Claims of known creditors and the Interests
of stockholders into Classes and sets forth the treatment offered each Class.
See "--Summary of Distributions Under the Plan" below. We believe we have
classified all Claims and Interests in compliance with the provisions of section
1123, but it is possible that a Holder of a Claim or Interest may challenge our
classification of Claims and Interests and that the Bankruptcy Court may find
that a different classification is required for the Plan to be confirmed. In
such event, it is our present intention, to the extent permitted by the
Bankruptcy Code and the provisions of the Plan, to make modifications of the
classification of Claims or Interests that are required by the Bankruptcy Court
for confirmation.

         Unimpaired Classes

         The following Classes of Claims and Interests are Unimpaired under the
Plan, and pursuant to section 1126(f) of the Bankruptcy Code, are conclusively
deemed to have accepted the Plan:

                       Class 1(a)--Miscellaneous Secured Claims
                       Class 2--Classified Priority Claims
                       Class 9--Subsidiary Interests




                                       30



         Voting Impaired Classes

         The Plan classifies Class 1(b) (GE Secured Claims), Class 3 (Old Note
Claims), Class 4 (ADLT General Unsecured Claims), Class 5 (Subsidiary Debtor
General Unsecured Claims), Class 6 (Preferred Interests), Class 7 (Common
Interests) and Class 8 (Old Other Interests) as Impaired Classes that will
receive a distribution under the Plan that are entitled to vote to accept or
reject the Plan. If a Holder of a Class 8 Old Other Interest exercises its right
to obtain Old Common Stock on account of its Old Other Interest as provided in
Section 3.13 of the Plan, such Holder shall be entitled to the treatment
provided to Class 7 in Section 3.12 of the Plan with respect to such Old Common
Stock. If such Holder fails to timely exercise its right to obtain Old Common
Stock, such Holder's Old Other Interest shall be canceled and extinguished and
such Holder shall not receive or retain any property under the Plan on account
of such Interest; in such event, pursuant to section 1126(g) of the Bankruptcy
Code, such Holder shall be conclusively presumed to have rejected the Plan in
respect of such Interest (even if such Holder cast a Ballot accepting the Plan)
because the Plan does not entitle the Holders of such Interests to receive or
retain any property under the Plan on account of such Interests.

Summary of Distributions Under the Plan

          Only Claims and Interests (i) as to which our liability and the amount
thereof are agreed to by us and the Holder of such Claim or Interest, (ii) as to
which our liability and the amount thereof are determined by Final Order of a
court of competent jurisdiction, (iii) which have been expressly Allowed in a
liquidated amount under the provisions of the Plan (but only to the extent so
Allowed), (iv) which is a Professional Claim for which a fee award amount has
been approved by Final Order of the Bankruptcy Court, (v) which is in an amount
and of the classification and type as set forth in our books and records or (vi)
which is, in the case of an Interest (Old Preferred Stock, Old Common Stock and
Old Other Interests) or any portion thereof only, held of record as set forth in
the books and records maintained by us or on our behalf as of the Distribution
Record Date ("Allowed Claims" and "Allowed Interests" respectively) are entitled
to receive distributions under the Plan; provided, however, that Holders of
Class 8 Old Other Interests exercising their rights to acquire Old Common Stock
pursuant to the terms of Section 3.13 of the Plan shall be considered to be
Holders of Old Common Stock as of the Distribution Record Date for purposes of
receiving distributions under Class 7 pursuant to Section 3.12 of the Plan.

         The distributions to be made under the Plan to the Holders of Allowed
Claims or Allowed Interests are in full satisfaction of any and all Claims and
Causes of Action of such Holders in respect of the Allowed Claims or Allowed
Interests. After the Effective Date, the Holders of Allowed Claims shall not be
entitled to enforce any rights in respect of our agreements or documents giving
rise to such Claims other than to enforce their right to receive the
distributions to be made to such Holders under the provisions of the Plan;
provided, however, that to the extent that Holders of Claims shall be entitled
to receive treatment such that their Claims are Reinstated, the agreements and
documents giving rise to such Claims shall not be canceled but shall remain in
full force and effect. Holders of Claims that we dispute shall continue to have
the right to seek to enforce such Claims after the Effective Date under the
agreements, instruments, documents or other legal bases giving rise to such
Claims, and we will continue to have the right to defend ourselves against such
Claims, defenses or setoffs accordingly and to assert any Claims that we or our
subsidiaries may have against such Holders.




                                       31



         The following describes the Plan's classification of Claims against and
Interests in the Debtors and the treatment that Holders of Allowed Claims and
Allowed Interests will receive under the Plan, unless they were to agree to
accept less favorable treatment by settlement or otherwise.

         If the Plan is confirmed by the Bankruptcy Court, each Holder of a
Claim or Interest will receive the same treatment as the other Holders of the
same Class of Claims or Interests (unless, if applicable, such Holder elects
lesser, alternative treatment), whether or not such Holder voted to accept the
Plan. Such treatment will be in full satisfaction, release and discharge of such
Holder's respective Claim or Interest, except as provided in the Plan. Upon
confirmation of the Plan, Claims and Interests will be modified as, and to the
extent, set forth in the Plan. Upon confirmation, the Plan will be binding on
all of our creditors and stockholders regardless of whether such creditors or
stockholders voted to accept the Plan.

         The following summary of the proposed distributions under the Plan does
not purport to be complete and is subject to, and qualified in its entirety by,
the Plan.

         Administrative Claims

         Administrative Claims are Claims constituting a cost or expense of
administration of the Chapter 11 Cases under section 503(b) of the Bankruptcy
Code. Administrative Claims include, without limitation, any actual and
necessary expenses of preserving our estate, any actual and necessary costs and
expenses of operating our business, any indebtedness or obligations incurred or
assumed by us as debtors-in-possession in connection with the conduct of our
businesses, cure claims arising from the assumption of executory contracts or
unexpired leases, any allowances of compensation or reimbursement of expenses
for Professionals, to the extent allowed by Final Order under sections 330
and/or 503(b) of the Bankruptcy Code, and fees or charges assessed under section
1930 of Title 28 of the United States Code.

         In general, to the extent that these Claims have not already been paid
pursuant to prior order of the Bankruptcy Court or applicable law, each Holder
of an Administrative Claim that is an Allowed Claim against us will be paid in
full, in Cash, on the Effective Date of the Plan (or as soon as practicable
after any such Administrative Claim becomes an Allowed Claim if the date of
allowance is later than the Effective Date), or will be paid upon such other
terms as may be mutually agreed upon.

         Payments to Professionals retained in the Chapter 11 Cases by us or the
Committees for compensation and reimbursement of expenses and all payments to
reimburse expenses of members of such Committees will be made in accordance with
the procedures established by the Bankruptcy Code and the Bankruptcy Rules
relating to the payment of interim and final compensation and expenses, as such
procedures have been modified by order of the Bankruptcy Court. The Bankruptcy
Court will review and determine all requests for compensation and reimbursement
of expenses. We estimate that the Administrative Claims of Professionals will
approximate $20,395,000. See "Expenses and Sources of Cash to be Used in
Connection with the Plan."




                                       32



         Further, pursuant to an order entered by the Bankruptcy Court on
February 6, 2003, Intercompany Claims generated by and among the Debtors and/or
ADLT's non-debtor subsidiaries were granted superpriority status under section
364(c)(1) of the Bankruptcy Code with priority over any and all administrative
expenses of the kind specified in sections 503(b) and 507(b) of the Bankruptcy
Code, subject and subordinate to the priorities, liens, claims and security
interests that may be granted under any order granted in these Chapter 11 Cases,
and the Debtors were granted authority to pay such Intercompany Claims, in the
Debtors' business discretion, in the ordinary course of the Debtors' businesses
without further order of the Bankruptcy Court.

         Finally, we will pay in Cash on the Effective Date of the Plan, the
reasonable (i) fees and expenses of the Old Indenture Trustee under the Old
Indenture and (ii) legal fees incurred by the Old Indenture Trustee in
connection with the Chapter 11 Cases. However, if we dispute any such amounts,
then relief will be sought from the Bankruptcy Court with respect to such
Disputed amounts.

         In addition to the foregoing, section 503(b) of the Bankruptcy Code
provides for the payment of compensation to creditors and other persons making a
"substantial contribution" to a Chapter 11 case and to attorneys for, and other
professional advisors to, such persons. Although we are currently unaware of any
entities that may seek compensation under the substantial contribution doctrine,
one or more entities could file applications with the Bankruptcy Court for
allowances of compensation and reimbursement of expenses for substantial
contribution. We cannot estimate the amounts that such entities may seek for
such compensation. Requests for compensation and reimbursement of expenses under
this "substantial contribution" standard must be approved by the Bankruptcy
Court after a hearing on notice, at which we and other parties in interest may
participate, and, if appropriate, object to the allowance of any compensation or
reimbursement of expenses.

         Priority Tax Claims

         Certain Claims for unpaid taxes are entitled to priority in right of
payment under section 507(a)(8) of the Bankruptcy Code (the "Priority Tax
Claims"). Pursuant to the Plan, as required by section 1129(a)(9)(c) of the
Bankruptcy Code, each Holder of a Priority Tax Claim that is an Allowed Claim
will be paid, at our election either, (i) on the later of the Effective Date and
the first business day following the date such Priority Tax Claim is Allowed,
(ii) over a period not to exceed six (6) years from the date such Priority Tax
Claim was assessed, in equal quarterly installments of principal plus interest
accruing after the Effective Date thereon at the rate defined in 28 U.S.C. ss.
1961 or such other rate as shall be fixed by the Bankruptcy Court or (iii) on
such other terms and conditions as may be agreed upon in writing by the Holder
of such Priority Tax Claim and us or as the Bankruptcy Court may order. We
estimate that the Priority Tax Claims will approximate $248,000.

         DIP Facility Claim

         The DIP Facility Claim consists of the Claim of the Bank Group, as
debtor-in-possession lenders (collectively, the "DIP Lenders") under the DIP
Facility. Borrowings under the DIP Facility are secured by security interests in
substantially all of our assets and those of our subsidiaries. On the later of
(i) the Effective Date, (ii) the date on which the DIP Facility Claim



                                       33



becomes Allowed and (iii) such other date agreed to by the Debtors or the
Reorganized Debtors, as the case may be, and the Holders of the DIP Facility
Claim, the Holders of the Allowed DIP Facility Claim shall receive in full
satisfaction, settlement, release and discharge of and in exchange for such
Allowed DIP Facility Claim: (A) Cash equal to the unpaid portion of such Allowed
DIP Facility Claim; or (B) such other treatment on such other terms and
conditions as may be agreed upon in writing by the Holders of such Claim and the
Debtors or the Reorganized Debtors, as the case may be, including, without
limitation, Reinstatement of such Claim, or as the Bankruptcy Court may order.
We estimate that the DIP Facility Claim will approximate $26,519,000. The DIP
Facility will be replaced as of the Effective Date by the New Credit Facility.

         Class 1(a)--Miscellaneous Secured Claims

         Pursuant to the Plan, each Holder of an Allowed Class 1(a)
Miscellaneous Secured Claim shall receive, in the sole discretion of the Debtors
or the Reorganized Debtors, as the case may be, in full satisfaction,
settlement, release, extinguishment and discharge of such Claim: (A) Cash equal
to the amount of such Allowed Miscellaneous Secured Claim on or as soon as
practicable after the later of (i) the Effective Date, (ii) the date that such
Miscellaneous Secured Claim becomes Allowed and (iii) a date agreed to by the
Debtors or the Reorganized Debtors, as the case may be, and the Holder of such
Claim; (B) treatment such that such Miscellaneous Secured Claim is Reinstated;
or (C) such other treatment on such other terms and conditions as may be agreed
upon in writing by the Holder of such Claim and the Debtors or the Reorganized
Debtors, as the case may be, or as the Bankruptcy Court may order. We estimate
that the Miscellaneous Secured Claims will approximate $508,000.

         Class 1(b)--GE Secured Claims

         Pursuant to the Plan, the Class 1(b) GE Secured Claims shall receive
nothing on the Effective Date, provided, however, on the Effective Date, or as
soon thereafter as the GE Secured Claims are Allowed, GE may offset from the
amounts owing by GE to the Debtors, including the Debtors' nondebtor affiliates,
and indefeasibly retain for GE's own account, an amount up to, but not in excess
of, the Allowed Amount of the GE Secured Claims. If, after giving effect to the
offset provided in Section 3.06(b) of the Plan, GE has any remaining Claims
against the Debtors, such Claims of GE shall be treated as Class 5 Subsidiary
Debtor General Unsecured Claims. Except to the extent of the offset permitted
under Section 3.06(b) of the Plan, nothing in Section 3.06(b) of the Plan shall
be or be deemed to be a waiver or release of any claim belonging to the Debtors
or their nondebtor affiliates against GE. We estimate that the GE Secured Claims
will approximate $2,390,000.

         Class 2--Classified Priority Claims

         Priority Claims in Class 2 comprise Claims against the Debtors that are
entitled to priority in distribution under section 507(a) or (b) of the
Bankruptcy Code. These include employment related Claims for wages, salaries or
commissions earned within 90 days prior to the bankruptcy filing, or Claims for
contributions to an employee benefit plan arising from services rendered within
180 days before the bankruptcy filing, in each case subject to a statutory cap
as to amount. To the extent that these Claims have not already been paid
pursuant to prior order of the Bankruptcy Court, each Holder of an Allowed Class
2 Classified Priority Claim shall



                                       34



receive in full satisfaction, settlement, release, extinguishment and discharge
of such Claim: (A) the amount of such unpaid Allowed Claim in Cash on or as soon
as reasonably practicable after the later of (i) the Effective Date, (ii) the
date on which such Class 2 Claim becomes Allowed and (iii) a date agreed to by
the Debtors or the Reorganized Debtors, as the case may be, and the Holder of
such Class 2 Claim; or (B) such other treatment on such other terms and
conditions as may be agreed upon in writing by the Holder of such Claim and the
Debtors or the Reorganized Debtors, as the case may be, or as the Bankruptcy
Court may order. We estimate that the Classified Priority Claims will
approximate $23,500.

         Class 3--Old Note Claims

         Class 3 consists of the Old Note Claims. Class 3 Old Note Claims are
Impaired. The Old Indenture Trustee has filed a proof of claim on behalf of all
Holders of Old Notes in the aggregate amount of $107,238,350.35. The Old Note
Claims will be Allowed under the Plan as follows:

                  (A) if Class 3 accepts the Plan pursuant to ss.1129(a)(8)(A)
          of the Bankruptcy Code, such Old Note Claims shall be Allowed in an
          aggregate amount equal to the sum of (i) $107,145,205 (being the sum
          of $100,000,000 plus interest at 8% from March 16, 2002 to the
          Petition Date) plus (ii) interest on the amount mentioned in (A)(i) of
          section 3.08 of the Plan from the Petition Date to the Effective Date
          at the rate of 8% per annum, or

                  (B) if Class 3 does not so accept the Plan, then such Old Note
          Claims shall be Allowed in an aggregate amount equal to (i)
          $107,145,205 (being the sum of $100,000,000 plus interest at 8% from
          March 16, 2002 to the Petition Date) plus (ii) interest on the amount
          mentioned in (B)(i) of section 3.08 of the Plan from the Petition Date
          to the Effective Date at that rate per annum which is the greater of:

                          (1) 1.32% (such rate being (a) the weekly average
                 1-year constant maturity Treasury yield, as published by the
                 Board of Governors of the Federal Reserve System for the week
                 ending Friday January 31, 2003, the end of the calendar week
                 preceding the Petition Date, and (b) specified as the
                 interest rate allowed on judgments entered in federal courts
                 pursuant to 28 U.S.C. ss.1961 and reported on the following
                 site on the internet:
                 http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt),

                          (2) such other rate per annum as the Bankruptcy
                 Court determines is legally required by the applicable
                 provisions of the Bankruptcy Code for accruals of
                 post-petition interest on unsecured debt.

         Class 3 Old Note Claims are Impaired. On or as soon as practicable
after the Effective Date, each Holder of an Allowed Old Note Claim as of the
Distribution Record Date shall receive from the Disbursing Agent, in full
satisfaction, settlement, release, extinguishment and discharge of such Claim, a
New Note in a principal amount equal to:

                   (A) the unpaid principal amount of such Old Note held by such
          Holder plus




                                       35



                   (B) the amount of interest accrued but unpaid on such Old
          Note from March 16, 2002 to the Petition Date plus

                   (C) interest on an amount equal to the sum of (A) and (B) in
          this sentence from the Petition Date to the Effective Date at the
          applicable rate as provided above in section 3.08 (A) or (B) of the
          Plan.

         Acceptance of the Plan by Class 3 shall, subject to consummation of the
Plan, constitute a waiver by all Holders of Class 3 Old Note Claims of any and
all defaults under the Old Indenture that may exist as of the Effective Date,
and an agreement to instruct the Old Indenture Trustee to take all actions to
effectuate the Plan.

         Class 4--ADLT General Unsecured Claims

         Class 4 consists of all unsecured Claims against ADLT (and not the
Subsidiary Debtors) that are not specifically included in other Classes under
the Plan. We estimate that ADLT General Unsecured Claims will approximate
$2,076,000 (certain ADLT General Unsecured Claims that have already been paid
pursuant to prior order of the Bankruptcy Court are not included in this
amount). Each Holder of Class 4 ADLT General Unsecured Claims shall be entitled
to receive interest on the Allowed Amount of such Holder's claim from the
Petition Date to the Effective Date at that rate per annum which is the greater
of:

                  (1) 1.32% (such rate being (a) the weekly average 1-year
          constant maturity Treasury yield, as published by the Board of
          Governors of the Federal Reserve System for the week ending Friday
          January 31, 2003, the end of the calendar week preceding the Petition
          Date, and (b) specified as the interest rate allowed on judgments
          entered in federal courts pursuant to 28 U.S.C. ss.1961 and reported
          on the following site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

                   (2) such other rate per annum as the Bankruptcy Court
          determines is legally required by the applicable provisions of the
          Bankruptcy Code for accruals of post-petition interest on unsecured
          debt.

         The Holder of each Class 4 ADLT General Unsecured Claim shall have an
election to accept either "85% Now Treatment" or "100% Stretch Treatment," as
described in ensuing sentences in Section 3.09 of the Plan. Such election shall
be exercised by each such Holder (including Holders of Disputed Class 4 Claims,
whether or not the proceedings to determine the Allowed Amount of such Holder's
Disputed Class 4 ADLT General Unsecured Claim shall have been concluded at the
Effective Date), pursuant to election forms which will be mailed to each such
Holder by Reorganized ADLT within five Cleveland, Ohio Business Days after the
Effective Date, subject to the requirement that each Holder who fails to have
made its election and to have caused its fully completed election form to have
been actually received by the Reorganized Debtors by 5:00 p.m. Cleveland time on
the 20th Cleveland, Ohio Business Day after the Effective Date shall be
conclusively deemed to have elected 85% Now Treatment.

         Each Holder who shall have elected 85% Now Treatment (or who shall have
been automatically deemed to have made such election) shall be entitled to
receive on the later of:




                                       36



                    (1) 45 days after the Effective Date,

                    (2) the date on which such Holder's Class 4 ADLT General
               Unsecured Claim shall have become Allowed,

                    (3) the date on which such Class 4 ADLT General Unsecured
               Claim, or any portion thereof, shall be paid pursuant to the
               established ordinary course of business or dealings between ADLT
               and the Holder of such Claim, and

                    (4) such other date agreed to by the Debtors or the
               Reorganized Debtors, as the case may be, and the Holder of such
               Class 4 ADLT General Unsecured Claim, an amount in Cash equal to
               85% of the Allowed Amount of such Holder's Class 4 ADLT General
               Unsecured Claim.

          Holders who shall have elected 100% Stretch Treatment shall be
entitled to receive, starting on the later of:

                   (1) the first Calendar-Quarter-End Date after the Effective
          Date, and

                   (2) the Calendar-Quarter-End Date next following the date on
          which each such Class 4 ADLT General Unsecured Claim shall have become
          Allowed, and on each of the next succeeding Calendar-Quarter-End Dates
          thereafter, until such Allowed Class 4 ADLT General Unsecured Claim is
          paid in full, an amount in Cash equal to 25% of the Allowed Amount of
          such Holder's Class 4 ADLT General Unsecured Claim, plus interest
          accrued on such portion of such Allowed Claim from the Effective Date
          through the date of such payment calculated at a rate (a) equal to the
          weekly average 1-year constant maturity Treasury yield, as published
          by the Board of Governors of the Federal Reserve System for the end of
          the calendar week in which the Effective Date occurs, and (b) as
          specified as the interest rate allowed on judgments entered in federal
          courts pursuant to 28 U.S.C. ss.1961 and reported on the following
          site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt, with
          the further understanding that on the 364th day after the Effective
          Date of the Plan, each Holder who shall have elected 100% Stretch
          Treatment shall receive the entire then-unpaid balance of its Class 4
          ADLT General Unsecured Claim, except that Holders of Claims that shall
          have elected 100% Stretch Treatment remain Disputed Class 4 ADLT
          General Unsecured Claims on such 364th day shall be entitled to
          receive 100% of their Allowed Claim on the date of Allowance thereof.

         All payments to Holders of Class 4 ADLT General Unsecured Claims shall
be made in Cash, unless otherwise agreed between Reorganized ADLT and the Holder
of such Claim.

                  Class 5--Subsidiary Debtor General Unsecured Claims

         Class 5 includes all unsecured Claims against the Subsidiary Debtors
(and not ADLT) that are not specifically included in other Classes under the
Plan. We estimate that Class 5 Subsidiary Debtor General Unsecured Claims will
approximate $2,412,000 (certain Subsidiary Debtor General Unsecured Claims that
have already been paid pursuant to prior order of the Bankruptcy Court are not
included in this amount). The Class 5 Subsidiary Debtor General Unsecured Claims
are Impaired. Each Holder of Class 5 Subsidiary Debtor General



                                       37



Unsecured Claims shall be entitled to receive interest on the Allowed Amount of
such Holder's claim from the Petition Date to the Effective Date at that rate
per annum which is the greater of:

                  (1) 1.32% (such rate being (a) the weekly average 1-year
          constant maturity Treasury yield, as published by the Board of
          Governors of the Federal Reserve System for the week ending Friday
          January 31, 2003, the end of the calendar week preceding the Petition
          Date, and (b) specified as the interest rate allowed on judgments
          entered in federal courts pursuant to 28 U.S.C. ss.1961 and reported
          on the following site on the internet:
          http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

                  (2) such other rate per annum as the Bankruptcy Court
          determines is legally required by the applicable provisions of the
          Bankruptcy Code for accruals of post-petition interest on unsecured
          debt.

         The Holder of each Class 5 Subsidiary Debtor General Unsecured Claim
shall have an election to accept either "85% Now Treatment" or "100% Stretch
Treatment," as described in ensuing sentences in section 3.10 of the Plan. Such
election shall be exercised by each such Holder (including Holders of Disputed
Claims, whether or not the proceedings to determine the Allowed Amount of such
Holder's Disputed Class 5 Subsidiary Debtor General Unsecured Claim shall have
been concluded at the Effective Date), pursuant to election forms which will be
mailed to each such Holder by Reorganized ADLT within five Cleveland, Ohio
Business Days after the Effective Date, subject to the requirement that each
Holder who fails to have made its election and to have caused its fully
completed election form to have been actually received by the Reorganized
Debtors by 5:00 p.m. Cleveland time on the 20th Cleveland, Ohio Business Day
after the Effective Date shall be conclusively deemed to have elected 85% Now
Treatment.

         Each Holder who shall have elected 85% Now Treatment (or who shall have
been automatically deemed to have made such election) shall be entitled to
receive on the later of:

                  (1) 45 days after the Effective Date,

                  (2) the date on which such Holder's Class 5 Subsidiary Debtor
          General Unsecured Claim shall have become Allowed,

                  (3) the date on which such Class 5 Subsidiary Debtor General
          Unsecured Claim, or any portion thereof, shall be paid pursuant to the
          established ordinary course of business or dealings between ADLT and
          the Holder of such Claim, and

                  (4) such other date agreed to by the Debtors or the
          Reorganized Debtors, as the case may be, and the Holder of such Class
          5 Subsidiary Debtor General Unsecured Claim, an amount in Cash equal
          to 85% of the Allowed Amount of such Holder's Class 5 Subsidiary
          Debtor General Unsecured Claim.

         Holders who shall have elected 100% Stretch Treatment shall be entitled
to receive, starting on the later of:

                    (1) the first Calendar-Quarter-End Date after the Effective
               Date, and


                                       38



                    (2) the Calendar-Quarter-End Date next following the date on
               which each such Class 5 Subsidiary Debtor General Unsecured Claim
               shall have become Allowed, and on each of the next succeeding
               Calendar-Quarter-End Dates thereafter, until such Allowed Class 5
               Subsidiary Debtor General Unsecured Claim is paid in full, an
               amount in Cash equal to 25% of the Allowed Amount of such
               Holder's Class 5 Subsidiary Debtor General Unsecured Claim, plus
               interest accrued on such portion of such Allowed Claim from the
               Effective Date through the date of such payment calculated at a
               rate (a) equal to the weekly average 1-year constant maturity
               Treasury yield, as published by the Board of Governors of the
               Federal Reserve System for the end of the calendar week in which
               the Effective Date occurs, and (b) as specified as the interest
               rate allowed on judgments entered in federal courts pursuant to
               28 U.S.C. ss.1961 and reported on the following site on the
               internet:
               http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt,
               with the further understanding that on the 364th day after the
               Effective Date of the Plan, each Holder who shall have elected
               100% Stretch Treatment shall receive the entire then-unpaid
               balance of its Class 5 Subsidiary Debtor General Unsecured Claim,
               except that Holders of Claims that shall have elected 100%
               Stretch Treatment remain Disputed Class 5 Subsidiary Debtor
               General Unsecured Claims on such 364th day shall be entitled to
               receive 100% of their Allowed Claim on the date of Allowance
               thereof.

          All payments to Holders of Class 5 Subsidiary Debtor General Unsecured
Claims shall be made in Cash, unless otherwise agreed between Reorganized ADLT
and the Holder of such Claim.

         Class 6--Preferred Interests

         Class 6 comprises our Old Preferred Stock (761,250 shares issued and
outstanding) and any contingent, disputed or unliquidated Claims related thereto
or in connection therewith. Saratoga holds Class 6 Interests in 761,250 Old
Preferred Shares; such Interests of Saratoga are Allowed under the Plan. On or
as soon as practicable after the Effective Date, Saratoga, the Holder of the
Allowed Class 6 Preferred Interest as of the Distribution Record Date shall
receive, in full satisfaction, settlement, release, extinguishment and discharge
of such Preferred Interest, and upon payment in Cash to ADLT by wire transfer of
immediately available funds, $18,000,000, 29,000 shares of New Preferred Stock
and 1,000 shares of New Common Stock, such that the Holders of the Allowed Class
6 Preferred Interests shall have received 100% of the authorized shares of New
Preferred Stock, all of which are to be outstanding on the Effective Date and
held by Saratoga, 100% of the shares of New Common Stock issued and outstanding
on the Effective Date and 90.8% of the Fully Diluted New Common Stock.
Acceptance of the Plan by Class 6 shall, subject to consummation of the Plan,
constitute an approval, as recipient of New Common Stock, of the Management
Incentive Plan and the Senior Management Contracts.

         Class 7--Common Interests

         Class 7 comprises our Old Common Stock (23,807,347 shares issued and
outstanding) and any contingent, disputed or unliquidated Claims related thereto
or in connection therewith. Class 7 Common Interests are Impaired. If Class 7
accepts the Plan pursuant to ss.1129(a)(8) of the Bankruptcy Code then, on or as
soon as practicable after the Effective Date, each Holder of an Allowed Class 7
Interest as of the Distribution Record Date (and any Holders in Class 8, other


                                       39



than Saratoga, electing to exercise their rights as set forth in section 3.13 of
the Plan) shall receive from the Disbursing Agent, in full satisfaction,
settlement, release, extinguishment, cancellation and discharge of such
Interest, for each share of Old Common Stock held by such Holder, the sum of
$0.1197 (11.97 cents) per share (based on 23,807,347 shares outstanding) payable
such that the Holders of Class 7 Common Interests shall have received in the
aggregate $2,850,000; provided, however, that the Cash distributions to be
received by such Holders shall be reduced by the aggregate amount of Allowed
Professional Claims of Professionals retained by or on behalf of the Equity
Committee up to $350,000, such that, at a minimum, such Holders shall have
received in the aggregate $2,500,000 (resulting in a Cash distribution of $0.105
(10.5 cents) per share of Old Common Stock (based on 23,807,347 shares
outstanding)). If Class 7 does not accept the Plan pursuant to ss.1129(a)(8) of
the Bankruptcy Code then they will be entitled to $2,500,000, pro rata,
including Saratoga, payable in quarterly installments of 25% of the amount
payable to such Holder starting, with respect to each Holder of a Class 7
Interest, on the later of (i) the first Calendar-Quarter-End Date after the
Effective Date and (ii) the Calendar-Quarter-End Date next following the date on
which each such Old Common Stock Interest shall have become Allowed, and on each
of the next succeeding Calendar-Quarter-End Dates thereafter, until such Allowed
Old Common Stock Interest is paid in full the amount provided for in Section
3.12 of the Plan, subject to the proviso that on the 364th day after the
Effective Date of the Plan, each such Holder shall receive the entire
then-unpaid balance of the amount due under the Plan in respect of such Class 7
Interest, without interest. Regardless of the foregoing, Holders of Old Common
Stock Interests that remain Disputed on such 364th day shall be entitled to
receive 100% of the amount due on their Allowed Interest on the date of
Allowance thereof. All payments to Holders of Class 7 Old Common Stock Interests
shall be made in Cash unless otherwise agreed between Reorganized ADLT and the
Holder of such Interest. No interest will accrue or be payable on Class 7 Old
Common Stock Interests or the payments made to Holders thereof.

         Class 8--Old Other Interests

         Class 8 comprises all other Interests in ADLT, including, without
limitation, holders of options, warrants, conversion privileges or other legal
or contractual rights to acquire our Old Common Stock or other Old Other
Interests. We estimate that there are approximately 830 Old Other Interests.
Each Holder of an Old Other Interest shall have the right to exercise its
options, warrants, conversion privileges or other legal or contractual rights to
obtain Old Common Stock representing such Interest, which shall become fully
vested as of the date of exercise of such right notwithstanding any provision to
the contrary in the contract or instrument giving rise to such Interest. To
exercise such right, such Holder shall (i) mark or check off the applicable box
on the Ballot cast by such Holder indicating such Holder's exercise of such
right and (ii) on or before the Effective Date, pay all required consideration
and otherwise satisfy all other applicable conditions in order to exercise such
right. If such Holder timely exercises its right to obtain such Old Common
Stock, such Holder shall be entitled to the treatment provided to Class 7 set
forth in Section 3.12 of the Plan with respect to such Old Common Stock. If such
Holder fails to timely exercise its right to obtain such Old Common Stock, such
Holder's Old Other Interest shall be canceled and extinguished and such Holder
shall not receive or retain any property under the Plan on account of such
Interest.


                                       40



         Class 9--Subsidiary Interests

         Class 9 comprises all authorized, issued and outstanding Interests in
any of the Subsidiary Debtors. Class 9 Interests are Unimpaired and the Holders
thereof are deemed to have accepted the Plan. Each Holder of an Interest in
Class 9 shall retain such Interest and its respective share or shares of common
stock of the Subsidiary Debtors representing such Interest, but such Holder
shall receive no distribution under the Plan on account of such Interest;
provided, however, that as soon as practicable after the Effective Date, the
Reorganized Debtors shall cause Microsun, LRI and ADLT Services to be dissolved
or merged into one of the other Debtors.

Summary of Other Provisions of or Relating to the Plan

         Preservation of Rights

         Except to the extent that any Claim is Allowed in an amount set forth
in the Plan, nothing shall affect, prejudice, diminish or impair our rights and
legal and equitable defenses to contest or defend ourselves against any Claims
or Interests in any lawful manner or forum or to contest the right of any Holder
of a Claim or Interest to setoff or recoup against any asserted Claims or
Interests, any amounts owed by such Holders to us or any of our subsidiaries.
The distributions provided for in Article III of the Plan shall at all times be
subject to section 502(d) of the Bankruptcy Code, which provides that no claim
of a creditor shall be allowed unless such creditor has paid in full any amount
owed to the debtor, or has turned over any property belonging to the debtor.

         Notwithstanding any other provisions of the Plan, no payments or
distributions will be made on account of a Claim or Interest until such Claim or
Interest becomes an Allowed Claim or Allowed Interest, as applicable. With
respect to any Claim or Interest that is disputed, all payments or distributions
shall be made pursuant to the Plan as soon as practicable after the date on
which such Claim or Interest becomes an Allowed Claim or Allowed Interest, as
applicable.

         Objections to Claims or Interests, or complaints or motions to
subordinate or estimate Claims or Interests, shall be filed with the Bankruptcy
Court, and served on the Holders of such Claims or Interests to which objection
is made, no later than one-hundred twenty (120) days after the Effective Date,
unless otherwise ordered by the Bankruptcy Court.

         Administrative Claims arising, accruing and/or incurred by the Debtors
on and after the Petition Date (other than Professional Claims of Professionals
retained in the Chapter 11 Cases) shall be filed with the Bankruptcy Court no
later than forty five (45) days after the Effective Date, unless otherwise
ordered by the Bankruptcy Court. Any such Administrative Claims filed after this
bar date shall be deemed Disallowed in full.

         Adoption of Senior Management Contracts.

         On the Effective Date, the Reorganized Company will enter into the
Senior Management Contracts with certain members of Senior Management. Copies of
the Senior Management Contracts are annexed as Exhibits F-1 to F-__ to the Plan.

         Adoption of Management Incentive Plan.

         On the Effective Date, the Reorganized Company will adopt the
Management Incentive Plan and issue the Management Options in accordance
therewith whereby certain members of

                                       41



Senior Management will be entitled to purchase 9.2% of the Fully Diluted New
Common Stock. A copy of the Management Incentive Plan is annexed as Exhibit A to
the Plan.

          Saratoga Management Services Agreement

          On the Effective Date, the Reorganized Company and Saratoga Management
Company, LLC ("SMC"), a Saratoga affiliate, will enter into a management
services agreement whereby the Reorganized Company shall (i) make an annual
payment of $600,000 in the aggregate to SMC in consideration for SMC providing
management-consulting services to and on behalf of the Reorganized Company (plus
0.5% of the aggregate amount of cash (and the fair market value of other
property as reasonably determined by the Reorganized Company's Board of
Directors) received by the Reorganized Company after the Effective Date in
connection with issuances of the Reorganized Company's equity securities), (ii)
pay to SMC an advisory fee equal to one percent (1%) of the enterprise value of
the Reorganized Company as of the Effective Date and (iii) pay to SMC advisory
and/or structuring fees in connection with any significant business
transactions. The management-consulting fee will be payable provided that there
is no default under the New Indenture relating to the New Notes. Upon any such
default and during the continuation of such default under the New Indenture, the
management-consulting fee shall accrue but not be payable until such default is
cured. The advisory fee shall be earned as of the Effective Date and shall be
payable from the cash proceeds of the sale(s) of certain non-core assets of the
Reorganized Company (the specific assets have not yet been determined), which
such sale(s) is expected to take place within the first year of the Effective
Date. A copy of the Saratoga Management Services Agreement is annexed as Exhibit
E to the Plan.


                                       42



         Saratoga/GE Stock Purchase Agreement

         On or about August 15, 2003, Saratoga and GE entered into a certain
Stock Purchase Agreement dated as of August 15, 2003 (the "Saratoga/GE Stock
Purchase Agreement") pursuant to which Saratoga purchased all of GE's Old
Preferred Stock and Old Common Stock in ADLT. Pursuant to the Saratoga/GE Stock
Purchase Agreement, if at any time ADLT shall have confirmed a chapter 11 plan
of reorganization and the same shall have become effective, and Saratoga and/or
any one or more of its affiliates shall have the right, directly or indirectly,
to elect a majority of the members of the Board of Directors of ADLT or any one
or more of its successors, then promptly thereafter Saratoga shall cause ADLT to
offer GE (and keep such offer open for at least 30 days), the rebate program
described on Schedule B annexed to the Saratoga/GE Stock Purchase Agreement. If
ADLT shall fail to offer GE such rebate program, then Saratoga shall be liable
to GE for $3,000,000 which Saratoga and GE agree is a reasonable estimate of the
actual damage GE would suffer if the rebate program is not offered. Schedule B
to the Saratoga/GE Stock Purchase Agreement provides that "[o]n or promptly
after the Effective Date, the Reorganized Debtors shall offer to General
Electric Company and its subsidiaries and affiliates (collectively herein, "GE")
(and keep such offer open for at least 30 days) an incremental sales incentive
plan, pursuant to which GE could earn a 10% rebate (up to a maximum of $13
million in the aggregate) on future purchases from the Reorganized Debtors and
its affiliates, excluding APL. To earn its rebate, GE must make annual purchases
(in the aggregate not to exceed $130 million) from the Reorganized Debtors and
their affiliates, excluding APL, in excess of the aggregate purchases GE made
from the Debtors, including its nondebtor affiliates, but excluding APL, in
ADLT's 2003 fiscal year. In no event shall there by any rebate in any year on
the amount of purchases equaling the total purchases by GE from the Debtors,
including its affiliates and subsidiaries, but excluding APL, in ADLT's 2003
fiscal year."

         Pursuant to the Saratoga/GE Stock Purchase Agreement, Saratoga shall
use its commercially reasonable efforts to have ADLT and APL assume in the
Chapter 11 Cases the following agreements: (i) the Lamp Materials Purchase
Agreement entered into as of September 30, 1999, between GE, acting through its
GE Lighting business, and APL and ADLT, (ii) the Know How and Patent License and
Technical Assistance Agreement dated as of September 30, 1999, between APL, ADLT
and GE, acting through its GE Lighting business, and (iii) the Consignment
Agreement entered into as of January 4, 1999, between APL and GE Lighting.

         Pursuant to the Saratoga/GE Stock Purchase Agreement, effective
automatically at any time that ADLT shall have confirmed a chapter 11 plan of
reorganization and the same shall have become effective, and Saratoga and/or any
one or more of its affiliates shall have the right, directly or indirectly, to
elect a majority of the members of the Board of Directors of ADLT and any one or
more of its successors, GE waives compliance by ADLT with Section 13 of the Lamp
Materials Purchase Agreement entered into as of September 30, 1999, if but only
if ADLT, in lieu of compliance with such Section 13, complies with the
substituted provisions set forth on Schedule A annexed to the Saratoga/GE Stock
Purchase Agreement, the same as if the language of such Schedule A had been
added to the agreement by amendment. Schedule A to the Saratoga/GE Stock
Purchase Agreement provides as follows:

          (a) In the event that ADLT desires to sell all or substantially all of
          Seller [APL] (whether as an asset, stock transfer, or otherwise) to a
          third party lighting products


                                       43



          competitor of Purchaser [GE] (a "Sale") then, in addition to the
          rights specified in Section 12, ADLT shall give notice (an "Offer
          Notice") to Purchaser that ADLT desires to engage in such a Sale. The
          Offer Notice shall identify (i) whether ADLT is proposing to sell
          assets in addition to that of Seller as part of the Sale, (ii) the
          price (the "Offer Price") that ADLT proposes to be paid for all of the
          assets being sold, including Seller (the "Offered Assets") and (iii)
          any other material terms sought by ADLT.

          (b) The giving of an Offer Notice shall constitute an offer (the
          "Offer") by ADLT to sell the Offered Assets to Purchaser for cash at
          the Offer Price and on the other terms set forth in the Offer Notice.
          The Purchaser shall have a 60-day period (the "Offer Period") in which
          to accept such Offer by giving a notice of acceptance to ADLT prior to
          the expiration of such Offer Period. If the Purchaser fails to notify
          ADLT prior to the expiration of the Offer Period, the Purchaser shall
          be deemed to have declined such Offer.

          (c) If the Purchaser elects to purchase the Offered Assets, the
          Purchaser shall purchase and pay, by bank or certified check (in
          immediately available funds), the Offer Price within 20 business days
          after the date on which the Offer was accepted; provided that, if the
          transaction is subject to any prior regulatory approval, the time
          period during which such transaction may be consummated shall be
          extended until the expiration of five business days after all such
          approvals shall have been received, but in no event shall such period
          be extended for more than an additional 60 days.

          (d) Upon the earlier to occur of i) rejection of the Offer by the
          Purchaser, ii) the expiration of the Offer Period without the
          Purchaser electing to purchase all of the Offered Assets and iii) the
          failure to obtain any required consent or regulatory approval for the
          transaction within 60 days of full acceptance of the Offer, ADLT shall
          have a one year period during which to effect a Sale of the Offered
          Assets on the same in all respects material to Purchaser or more
          favorable (as to ADLT) terms and conditions as were set forth in the
          Offer Notice at a price not less than the Offer Price; provided that,
          if such Sale is subject to regulatory approval, such one year period
          shall be extended until the expiration of five business days after all
          such approvals shall have been received.

          (e) If ADLT does not consummate a Sale of the Offered Assets in
          accordance with the foregoing time limitations, then the right of ADLT
          to effect such a Sale pursuant to this Section 13(d) shall terminate
          and ADLT shall again comply with the procedures set forth in this
          Section 13 with respect to any proposed Sale of the Offered Assets.

         Pursuant to the Saratoga/GE Stock Purchase Agreement, Saratoga shall
use its reasonable commercial efforts to ensure that ADLT's trade payables to GE
are handled in accordance with Schedule C annexed to such agreement, which shall
be incorporated into ADLT's plan of reorganization to be submitted and approval
of which will be sought from the Bankruptcy Court. Schedule C to the Saratoga/GE
Stock Purchase Agreement provides as follows:

                  Section 3.06. (b) Class 1(b) Claims: Secured Claims of GE. The
          Class 1(b) GE Secured Claims shall receive nothing on the Effective
          Date, provided, however, on the Effective Date, or as soon thereafter
          as the GE Secured Claims are Allowed, GE may offset from the amounts
          owing by GE to the Debtors, including the Debtors' nondebtor


                                       44



          affiliates, and indefeasibly retain for GE's own account, an amount up
          to, but not in excess of, the Allowed Amount of the GE Secured Claims.
          If, after giving effect to the offset provided in this Section
          3.06(b), GE has any remaining Claims against the Debtors, such Claims
          of GE shall be treated as Class 5 Subsidiary Debtor General Unsecured
          Claims. Except to the extent of the offset permitted under this
          Section 3.06(b), nothing in this Section 3.06(b) shall be or be deemed
          to be a waiver or release of any claim belonging to the Debtors or
          their nondebtor affiliates against GE.

          Treatment of Hellman Loan

          Beginning in October 1998, ADLT made a series of loans to Hellman so
that he could avoid forced liquidation of a substantial block of his ADLT stock
(approximately 10% of the then-outstanding ADLT stock) which secured certain
personal margin loans from Prudential Securities, Inc. ("Prudential"). Due to a
decline in the ADLT stock price in October 1998, Hellman received a margin call
from Prudential which he was not financially able to meet. ADLT agreed to
advance funds to Hellman to cover the margin call because, among other reasons,
a forced liquidation of Hellman's ADLT stock would impair shareholder value and
would have a devastating effect on Hellman's personal finances which in turn
could adversely affect Hellman's performance in his critical position as
Chairman of the Board and CEO of ADLT. ADLT and Hellman thereafter amended the
Hellman Loan Documents several times to, among other things, extend the maturity
date and advance additional funds to Hellman to cover subsequent margin calls
triggered by further declines in the ADLT stock price. In addition to the
reasons referenced above, ADLT determined that the additional loans were in the
shareholders' best interests because the liquidation of Hellman's stock would
impair ADLT's ability to take advantage of certain tax benefits and would
trigger certain obligations owed to GE.

         As of June 30, 2003, Hellman owed ADLT approximately $15,647,000,
consisting of principal of approximately $12,789,000 and interest of
approximately $2,858,000. The Hellman Loan matures on July 31, 2007. Under the
Hellman Loan Documents, ADLT has a security interest in substantially all of
Hellman's personal assets, including residences in Ohio and Florida. Hellman
also is obligated to prepay the Loan with proceeds from any settlement of his
claims against Prudential.

         As part of the reorganization, ADLT, along with Saratoga, believe it is
appropriate to resolve the Hellman Loan under the Plan. These parties, along
with Hellman, have agreed in principle, subject to formal documentation and
Court approval, that pursuant to section 1123(b)(3)(A) of the Bankruptcy Code,
the Hellman Loan Documents shall be modified to reduce the amount of the
outstanding indebtedness owed by Hellman to $_________________ ("Designated
Amount"), which is the approximate amount of Hellman's personal net worth as of
the Effective Date. Additionally, on or before the Effective Date, the proceeds
from Hellman's settlement with Prudential of approximately $_______ will be paid
over to ADLT for application to the Hellman Loan (such funds shall be applied
prior to the reduction of the Hellman Loan amount to Hellman's net worth). Other
than reducing the amount of the Hellman Loan as set forth above, the Hellman
Loan Documents shall otherwise remain in full force and effect.

         Hellman is in the process of providing ADLT with a personal financial
statement and certain backup documents, which ADLT is in the process of
reviewing. ADLT also is in the process of completing its own investigation
regarding Hellman's assets and liabilities.


                                       45



         ADLT believes that the treatment of the Hellman Loan under the Plan is
fair and equitable and in the best interests of creditors. In reaching this
decision, ADLT considered several factors, including: (i) the likely difficulty
in collection; (ii) the probability of success in any litigation challenging the
enforceability of the Hellman Loan Documents; (iii) the complexity of such
litigation, including attendant expense, inconvenience and delay; and (iv) the
paramount interest of creditors. First, in terms of difficulty of collection,
Hellman has informed ADLT that, based on the advice of his personal bankruptcy
counsel, unless the Hellman Loan is forgiven beyond his net worth, he will file
personal bankruptcy prior to the Effective Date so as to discharge that portion
of the Hellman Loan. Second, with respect to the probability of success, Hellman
and his counsel have challenged whether the Hellman Loan Documents are legally
unenforceable. Although ADLT believes that Hellman's purported defenses to the
Loan lack merit, there is some risk that Hellman might prevail on such defenses.
Third, ADLT would likely incur substantial attorneys' fees and expenses in any
action to collect the Hellman Loan, including litigating the enforceability of
the Hellman Loan Documents and Hellman's defenses thereto.

         Additionally, the foregoing treatment of the Hellman Loan is generally
consistent with ADLT's treatment of the Hellman Loan in its books and records.
In particular, ADLT has continuously written down the value of the Hellman Loan
to reflect ADLT's assessment of the degree to which the Loan is impaired (i.e.,
the extent to which Hellman's personal assets are insufficient to repay the
Loan). The proposed treatment of the Hellman Loan under the Plan conforms to the
reality of the circumstances.

         Finally, it is critical to note that the reduction of the Hellman Loan
does not constitute compensation to Hellman for, among other things, services
performed on behalf of ADLT or to be performed by Hellman on behalf of
Reorganized ADLT, which might otherwise be taxable. Rather, the write-down of
the Hellman Loan is based solely on ADLT's assessment of the collectibility of
the Loan and the other factors set forth above. Accordingly, ADLT does not
believe that the treatment of the Hellman Loan under the Plan will trigger any
tax consequences for ADLT or Reorganized ADLT (as the case may be). The tax
treatment and consequences of the modification of the Hellman Loan are not
confidential. See also "--Senior Management Employment Agreements" below.

         Treatment of Executory Contracts and Unexpired Leases

         On the Effective Date, all executory contracts and unexpired leases
that exist between the Debtors and any person shall be deemed assumed in
accordance with the provisions and requirements of section 365 of the Bankruptcy
Code if such contracts:

o    have not terminated or expired pursuant to their own terms;

o    have not previously been assumed, assumed and assigned or rejected pursuant
     to an order of the Bankruptcy Court on or prior to the Confirmation Date;

o    are not the subject of pending motions to assume, assume and assign or
     reject as of the Confirmation Date; or

o    are not listed on the Schedule of Rejected Contracts.



                                       46



         Notwithstanding any other provisions of Section 6.01 of the Plan, (a)
that certain Lamp Materials Purchase Agreement entered into by and between APL,
ADLT and GE, as of September 30, 1999, as amended by letter agreement dated
October 4, 1999, (b) that certain Patent and Technical Assistance Agreement
entered into by and among APL, ADLT and GE, as of September 30, 1999, and (c)
that certain Consignment Agreement entered into as of January 4, 1999 between
APL and GE (collectively, the "GE Contracts"), are deemed assumed under Section
6.01 of the Plan, and GE waives any and all defaults, claims for such defaults
and rights to assert the need for adequate assurance of future performance under
11 U.S.C. ss. 365(b)(1)(A), (B) and (C) with respect to such GE Contracts.

         The Debtors shall have the right, subject to the consent of Saratoga,
at any time prior to the Confirmation Date, to amend the Schedule of Rejected
Contracts upon notice to the other party to such contract or lease:

o    to delete any executory contract or unexpired lease listed therein, thus
     providing for its assumption pursuant to the Plan; or

o    to add any executory contract or unexpired lease to the Schedule of
     Rejected Contracts, thus providing for its rejection pursuant to the Plan.

         The Confirmation Order (except as otherwise provided therein) shall
constitute an order of the Bankruptcy Court approving such assumptions. Each
contract or lease assumed will be assumed only to the extent that any such
contract or lease constitutes an executory contract or unexpired lease.
Assumption of a contract or lease does not constitute our admission that such
contract or lease is an executory contract or unexpired lease. All executory
contracts and unexpired leases that are assumed will be assumed under their
present terms or upon such terms as are agreed to between us and the other party
to the executory contract or unexpired lease. Each executory contract and
unexpired lease that is assumed and relates to the use, ability to acquire, or
occupancy of real property shall include:

o    all modifications, amendments, supplements, restatements, or other
     agreements made directly or indirectly by any agreement, instrument, or
     other document that in any manner affect such executory contract or
     unexpired lease; and

o    all executory contracts or unexpired leases appurtenant to the premises,
     including all other interests in real estate related to such premises,
     unless any of the interests has been rejected pursuant to an order of the
     Bankruptcy Court.

         If an executory contract or unexpired lease is rejected, the other
party to the agreement may file a Claim for damages incurred by reason of the
rejection. (In the case of rejection of leases of real property or of employment
agreements, damage Claims are subject to certain limitations imposed by the
Bankruptcy Code.) In order to assume an executory contract or unexpired lease,
we must first cure any existing defaults pursuant to section 365(b) of the
Bankruptcy Code. If an executory contract or unexpired lease is assumed, we have
a duty to perform our contractual obligations according to the terms of the
agreement. Failure to perform these obligations once the lease or executory
contract is assumed would result in a Claim for damages which ordinarily would
be entitled to priority treatment as an administrative expense. See "--Summary
of Distributions Under the Plan-Administrative Claims" above.



                                       47



         Conditions to Effectiveness

         The Plan shall not be consummated and the Effective Date shall not
occur unless and until the following conditions have occurred or have been duly
waived (if waivable) pursuant to the terms of the Plan:

o    the Confirmation Order shall have been entered and shall have become a
     Final Order and such order shall not have been vacated, reversed, stayed,
     modified, amended, enjoined or restrained by order of a court of competent
     jurisdiction;

o    all Plan Documents required to be executed or delivered under the Plan on
     or prior to the Effective Date shall be in a form that is reasonably
     acceptable to the Debtors and Saratoga;

o    all Plan Documents required to be executed or delivered under the Plan on
     or prior to the Effective Date shall have been executed and delivered by
     the parties thereto;

o    the Bankruptcy Court shall have entered an order (contemplated to be part
     of the Confirmation Order) authorizing and directing the Debtors and the
     Reorganized Debtors to take all actions necessary or appropriate to enter
     into, implement, and consummate the Plan Documents, contracts, instruments,
     releases, indentures and other agreements or documents created, amended,
     supplemented, modified or adopted in connection with the Plan;

o    the New ADLT Articles of Incorporation shall have been filed with the Ohio
     Secretary of State in accordance with Ohio law;

o    all authorizations, consents and regulatory approvals required, if any, in
     connection with the Plan's effectiveness shall have been obtained;

o    the New Credit Facility shall have become effective;

o    the New Indenture and all related documents shall have been entered into by
     the parties thereto;

o    the Saratoga Management Services Agreement shall have been entered into by
     the parties thereto;

o    the Senior Management Contracts shall have been entered into by the parties
     thereto;

o    the Management Incentive Plan shall have been adopted by ADLT and the
     Management Options to be issued on the Effective Date thereunder shall have
     been issued;

o    no order of a court shall have been entered and shall remain in effect
     restraining the Debtors or Saratoga from consummating the Plan; and

o    an Indenture for the New Notes shall have been qualified by the Commission
     under the Trust Indenture Act of 1939, as amended.


                                       48



         Failure to satisfy these conditions would likely result in our
inability to complete the Recapitalization and consummate the Plan. See "RISK
FACTORS--Risks Related to the Plan." Additionally, the Confirmation Order shall
contain a finding of fact that the Reorganized Debtors, the Creditors Committee,
GE and each of their Professionals acted in good faith within the meaning of and
with respect to the actions described in section 1125(e) of the Bankruptcy Code
and are therefore not liable for the violation of any applicable law, rule or
regulation governing such actions.

Board of Directors

         From and after the Effective Date, there will be seven (7) members of
Reorganized ADLT's Board of Directors: Wayne Hellman, Sabu Krishnan, Christian
Oberbeck, Damon Ball, Richard Petrocelli and two individuals appointed by
Saratoga in consultation with the Company's management. The Board of Directors
for each of the Subsidiary Debtors shall consist of one (1) or more members to
be appointed by Reorganized ADLT's Board of Directors. See "MANAGEMENT, BOARD OF
DIRECTORS AND INSIDER RELATIONSHIPS--Board of Directors."

New ADLT Articles of Incorporation

         The New ADLT Articles of Incorporation shall satisfy the provisions of
the Plan and the Bankruptcy Code and shall include or provide for, without
limitation, (a) authorization to issue the New Notes, the New Common Stock and
the New Preferred Stock and (b) a prohibition on the issuance of nonvoting
equity securities to the extent, and only to the extent, required by section
1123(a)(6) of the Bankruptcy Code. A copy of the New ADLT Articles of
Incorporation is annexed as Exhibit B to the Plan.

Means for Implementation of the Plan

         The Effective Date of the Plan is the Business Day that is no more than
ten (10) Business Days in New York, N.Y. following the date on which all
conditions to consummation set forth in Article IX of the Plan have been
satisfied or, if capable of being duly and expressly waived, any conditions to
the occurrence of consummation set forth in the Plan have been satisfied or
waived; provided, however, that the Effective Date may be extended upon the
written approval of each of the Debtors and Saratoga.

         On the Effective Date, we are authorized to and shall issue the New
Notes, the New Preferred Stock and the New Common Stock and to take such other
actions, including making certain cash payments, as are contemplated by the
Plan. Such actions shall include, without limitation, transfer to the Disbursing
Agent of the New Notes, the New Preferred Stock and the New Common Stock
distributable to certain Holders of Allowed Claims or Allowed Interests under
the Plan.

Expenses and Sources of Cash to be Used in Connection with the Plan

         The following table reflects the professional fees and expenses that we
have incurred or expect to incur with respect to the Chapter 11 Cases. Such fees
and expenses have a statutory priority over any Class of Claims or Interests
entitled to vote on the Plan. We believe that the available cash and cash
generated by operations, together with the proceeds from the New Credit


                                       49



Facility, will be sufficient to cover all of our cash obligations as of the
Effective Date and that we will thereafter have sufficient working capital to
meet our obligations as they become due. See "Risk Factors" and "Accounting
Treatment of the Recapitalization" below.

Debtors' legal fees and expenses....................................$ 6,681,000
Debtors' financial advisor fees and expenses .......................$ 5,558,000
Debtors' accounting fees and expenses ..............................$   744,000
Creditors Committee's professional fees and expenses................$ 3,492,000
Equity Committee's professional fees and expenses...................$ 1,168,000
Saratoga's legal fees and expenses..................................$   900,000
United States Trustee's fees........................................$    67,000
Bank Group's professional fees and expenses.........................$ 1,381,000
Prior Lenders' professional fees and expenses.......................$   404,000
                                                                    -----------
         TOTAL .....................................................$20,395,000

Modification of the Plan

         The Debtors and Saratoga, acting jointly, may alter, amend or modify
the Plan, including all exhibits to the Plan, in accordance with section 1127 of
the Bankruptcy Code or as otherwise permitted at any time prior to the date of
confirmation (the "Confirmation Date") without additional disclosure pursuant to
section 1125 of the Bankruptcy Code, except as the Bankruptcy Court or
Bankruptcy Code may otherwise require. Prior to confirmation, a plan may be
modified provided that the plan, as modified, does not violate sections 1122
(governing classification of claims and interests) and 1123 (setting forth
certain plan requirements) of the Bankruptcy Code. The potential impact of any
amendment, modification or supplement on the Holders of Claims and Interests
cannot presently be foreseen, but may include a change in the economic impact of
the Plan on some or all of the Classes of Claims and Interests or a change in
the relative rights of such Classes. However, if any of the terms of the Plan
are amended, modified or supplemented in a manner determined by us or the
Bankruptcy Court to constitute a material adverse change, we will promptly
disclose any such amendment, modification or supplement in a manner reasonably
calculated to inform the Holders adversely affected thereby, and, if and to the
extent required by the Bankruptcy Court, resolicit acceptances.

         After the Confirmation Date and prior to substantial consummation of
the Plan, and in accordance with the provisions of section 1127(b) of the
Bankruptcy Code and the Bankruptcy Rules, the Debtors and Saratoga and any party
in interest may, so long as the treatment of Holders of Claims or Interests
under the Plan is not adversely affected, institute proceedings in the
Bankruptcy Court to remedy any defect or omission or reconcile any
inconsistencies in the Plan, this Disclosure Statement or the Confirmation Order
and any other matters as may be necessary to carry out the purposes and effects
of the Plan; provided, however, prior notice of such proceedings shall be served
in accordance with Bankruptcy Rules 2002 and 9014.


                                       50



Withdrawal of the Plan

         The Debtors and Saratoga, acting jointly, reserve the right, at any
time prior to Confirmation of the Plan, to revoke and withdraw the Plan. If the
Plan is revoked or withdrawn or if the Confirmation Date does not occur, the
Plan shall be null and void and have no force and effect. In such event, nothing
contained in the Plan shall be deemed to constitute a waiver or release of any
claims by the Debtors or Saratoga or against the Debtors or any other Person or
to prejudice in any manner the rights of the Debtors, Saratoga or any Person in
any further proceedings involving the Debtors.

Withdrawal of Votes on the Plan

         Once the acceptance or rejection of any Holder of an Impaired Claim or
Impaired Interest entitled to vote on the Plan has been transmitted to the
Voting Agent in accordance herewith, such acceptance or rejection may only be
withdrawn or modified for cause shown by such Holder to the Bankruptcy Court
upon notice and a hearing.

Confirmation of the Plan

         Parties in interest, including all Holders of Claims and Interests,
will receive notice of the date and time fixed by the Bankruptcy Court for the
Confirmation Hearing. The Bankruptcy Court will also establish procedures for
solicitation and confirmation of the Plan.

         For the Plan to be confirmed, the Bankruptcy Code requires the
Bankruptcy Court to determine that the Plan complies with the requirements of
section 1129 of the Bankruptcy Code. The confirmation requirements of section
1129 include, among other things, that:

o    the Plan be accepted by at least one Class of Impaired Claims without
     considering the votes of "insiders;"

o    the Plan is feasible (that is, there is a reasonable probability that we
     will be able to perform our obligations under the Plan and continue to
     operate our business without further financial reorganization or
     liquidation) (see "-Feasibility Test," below); and

o    the Plan meets the requirements of section 1129(a)(7) of the Bankruptcy
     Code, which requires that, with respect to each Impaired Class, each Holder
     of a Claim or an Interest either (i) accepts the Plan or (ii) receives at
     least as much pursuant to the Plan as such Holder would receive in a
     liquidation under Chapter 7 of the Bankruptcy Code.

         There are several other confirmation standards that we must
demonstrate, including, without limitation, that:

o    the Plan is proposed in good faith;

o    the Plan and its proponents comply with the Bankruptcy Code;

o    payments for services in or in connection with the Chapter 11 Cases or the
     Plan are approved by or subject to Bankruptcy Court approval;


                                       51



o    our management, officers, directors or trustees have been disclosed, as
     well as their compensation, and their continuation in office is consistent
     with the interests of creditors, stockholders and public policy;

o    all statutory fees have been or will be paid; and

o    there is a continuation of retiree health benefits at certain levels as
     provided under section 1114 of the Bankruptcy Code.

         Although we believe that we will meet each of these tests, as well as
the other requirements of section 1129 of the Bankruptcy Code, there can be no
assurance that the Bankruptcy Court will reach the same conclusion and confirm
the Plan. See "RISK FACTORS--Risks Related to the Plan."

Acceptance of the Plan

         Under section 1129(a)(10) of the Bankruptcy Code, if a class of claims
is impaired under a plan, a condition to confirmation is that such plan must be
accepted by holders of at least one class of "impaired" claims without
considering the votes of "insiders" within the meaning of the Bankruptcy Code.
The Impaired Classes of Claims under the Plan are Class 1(b) (GE Secured
Claims), Class 3 (Old Note Claims), Class 4 (ADLT General Unsecured Claims) and
Class 5 (Subsidiary Debtor General Unsecured Claims). Accordingly, at least one
of these Classes must accept the Plan in order for the requirement of section
1129(a)(10) to be met.

Feasibility Test

         The Bankruptcy Code also requires that, to confirm a plan of
reorganization, the bankruptcy court must find that confirmation of such plan is
feasible, meaning that it is not likely to be followed by liquidation or the
need for further financial reorganization of the debtor (the "Feasibility
Test"). For the Plan to meet the Feasibility Test, the Bankruptcy Court must
find that we will possess the resources and working capital necessary to provide
all creditors with the treatment specified in the Plan and to continue to
operate our businesses upon and after the consummation of the Plan. Based on the
projections and other financial information set forth in Annex B, we believe the
Plan satisfies the Feasibility Test.

Best Interests of Creditors Test; Liquidation Value

         In addition, the Bankruptcy Code requires that, to confirm a plan of
reorganization, each holder of a claim or equity interest in an impaired class
must either:

o    accept the plan; or

o    receive or retain under the plan cash or property of a value, as of the
     effective date of the plan, that is not less than the value such holder
     would receive or retain if the debtor were liquidated under Chapter 7 of
     the Bankruptcy Code (the "Best Interests" test).

         To calculate what holders of each impaired class of claims or equity
interests would receive in a Chapter 7 liquidation, the bankruptcy court must
determine the "liquidation value"

                                       52



of the debtor, which would consist primarily of the net proceeds from a forced
sale of the debtor's assets by a Chapter 7 trustee. The proceeds from a Chapter
7 liquidation that would be available to all unsecured claims would be reduced
or diluted by:

o    secured claims to the extent of the value of the collateral securing such
     claims;

o    the costs and expenses of liquidation, including the costs incurred to sell
     the assets;

o    the administrative expenses of the Chapter 7 cases, including the fees of a
     trustee, counsel, financial advisors, accountants and other professionals;

o    additional contingent claims and losses arising during the operation of our
     business in Chapter 7;

o    priority claims arising in the Chapter 7 and prior Chapter 11 cases; and

o    administrative expenses and claims in the prior Chapter 11 cases, including
     the fees of counsel, financial advisors, accountants and other
     professionals.

         Based on the information set forth in the Liquidation Analysis attached
as Annex C hereto, we believe that Confirmation of the Plan will provide each
Holder of a Claim or Interest in Classes 1(b) and 3-8 with an equal or greater
recovery than it would receive if the Company were liquidated under Chapter 7 of
the Bankruptcy Code. In our view, a Chapter 7 liquidation involves additional
uncertainty not fully reflected in the Liquidation Analysis with respect to both
timing and amount of payments to Holders of such Claims and Interests. We
believe that the Plan provides as much certainty as is possible regarding these
matters.

         Accordingly, we believe that the Plan meets the requirements of section
1129(a)(7) of the Bankruptcy Code.

Effects of Plan Confirmation

         Discharge

         Except as otherwise provided in the Bankruptcy Code, the Plan or the
Confirmation Order, subject to the occurrence of the Effective Date, the
provisions of the Plan shall be binding on us, our subsidiaries and our
creditors and equity security holders, regardless of whether the Claims or
Interests of any such creditor or equity security holder is Impaired under the
Plan, and regardless of whether any such creditor or equity security holder has
accepted the Plan. Furthermore, except as otherwise provided in the Bankruptcy
Code, the Plan or the Confirmation Order, subject to the occurrence of the
Effective Date, we and our subsidiaries shall retain all of our property free
and clear of all Claims and Interests of creditors and equity security holders,
and we and our subsidiaries shall be discharged and forever released from any
debt that arose before the Confirmation Date, regardless of whether (i) a proof
of claim has been filed or deemed filed in respect of such debt, (ii) any Claim
in respect of such debt has been Allowed under section 502 of the Bankruptcy
Code, or (iii) the Holder of any Claim in respect of such debt has accepted the
Plan. In addition, subject to the occurrence of the Effective Date,

                                       53



confirmation of the Plan shall terminate all rights and Interests of the Holders
of our Old Preferred Stock (Class 6), Old Common Stock (Class 7) and Old Other
Interests (Class 8).

Injunction

         Discharged Claims and Terminated Interests

         Except as otherwise expressly provided for in the Plan or the
Confirmation Order and to the fullest extent authorized or provided by the
Bankruptcy Code, including sections 524 and 1141 thereof, the entry of the
Confirmation Order shall, provided that the Effective Date occurs, permanently
enjoin all persons that have held, currently hold or may hold a Claim or other
debt or liability that is discharged or an Interest or other right of an equity
security holder that is Impaired or terminated pursuant to the terms of the Plan
from taking any of the following actions against us or our property on account
of any such discharged Claims, debts or liabilities or such terminated Interests
or rights:

o    commencing, conducting or continuing in any manner, directly or indirectly,
     any suit, action or other proceeding of any kind;

o    enforcing, levying, attaching, collecting or otherwise recovering in any
     manner or by any means, whether directly or indirectly, any judgment,
     award, decree or order;

o    creating, perfecting or enforcing in any manner, directly or indirectly,
     any lien or encumbrance of any kind;

o    asserting any setoff, offset, right of subrogation or recoupment of any
     kind, directly or indirectly, against any debt, liability or obligation due
     to us; and

o    proceeding in any manner in any place whatsoever, including employing any
     process, that does not conform to or comply with or is inconsistent with
     the provisions of the Plan.

         Released Claims and Interests

         As of the Effective Date of the Plan, the Confirmation Order shall
constitute an injunction permanently enjoining any Person that has held,
currently holds or may hold a Claim, Interest, demand, debt, right, Cause of
Action or liability that is released pursuant to Section 11.04 of the Plan from
enforcing or attempting to enforce any such Claim, Interest, demand, debt,
right, Cause of Action or liability against (i) us and our subsidiaries, both
before and after the Recapitalization, (ii) our agents and Professionals, (iii)
any of our and our subsidiaries' directors, officers or employees who continue
in such positions subsequent to the Effective Date or (iv) any of our and our
subsidiaries' former directors, officers or employees, or any of our or their
respective property, based on, arising from or relating to, in whole or in part,
any act, omission, or other occurrence taking place on or prior to the Effective
Date with respect to or in any way relating to the Chapter 11 Cases, all of
which claims, demands, debts, rights, Causes of Action or liabilities will be
deemed released on the Effective Date; provided, however, that with respect to
the former directors, officers and employees of the Debtors, this injunction
shall apply only to the enforcement of Claims, demands, debts, rights, Causes of
Action or liabilities with respect to which such former directors, officers and
employees would be entitled to

                                       54



indemnification from us or our subsidiaries under contract or law; provided
further, however, that this injunction shall not apply to (a) any Claims
Creditors may assert under the Plan to enforce their rights thereunder to the
extent permitted by the Bankruptcy Code or (b) any Claims Creditors or other
third parties may have against each other, which claims are not related to us or
our subsidiaries, it being understood, however, that any defenses, offsets or
counterclaims of any kind or nature whatsoever which we may have or assert in
respect of any of the claims of the type described in (a) or (b) of this proviso
are fully preserved.

         Exculpation

         None of the Debtors, the Reorganized Debtors, the Creditors Committee,
their respective Professionals, Saratoga or the Exculpated Persons shall have or
incur any liability to any Person, including, without limitation, any Holder of
a Claim or Interest or any other party in interest, or any of their respective
agents, employees, representatives, financial advisors, attorneys or affiliates
or any of their successors or assigns, for any act taken or omission made in
good faith in connection with, relating to, or arising out of, the Chapter 11
Cases, Filing, negotiating, prosecuting, administrating, formulating,
implementing, confirming or consummating the Plan or the Property to be
distributed under the Plan, including all pre-petition and post-petition
activities leading to the promulgation and confirmation of the Plan, this
Disclosure Statement (including any information provided or statement made in
this Disclosure Statement or omitted therefrom), or any contract, instrument,
release or other agreement or document created in connection with or related to
the Plan or the administration of the Debtors or these Chapter 11 Cases.

         "Exculpated Persons" means (i) the directors, officers and employees of
the Debtors in each of the Chapter 11 Cases as of the Petition Date or that have
become officers, directors or employees thereafter but prior to the Effective
Date, (ii) the Debtors' agents and Professionals, (iii) the members of the
Creditors Committee, (iv) the Creditors Committee's Professionals, (v) GE, (vi)
Saratoga and (vii) the respective Affiliates, current and former officers,
directors, employees, agents, stockholders, managers, advisors and professionals
(including the current and former officers, directors, employees, agents,
members, stockholders and professionals of the exculpated professionals) of the
foregoing exculpated persons identified in subclause (ii) above; provided,
however, that the foregoing exculpated parties identified in subclasses (i)
through (vii) above shall be exculpated only for liabilities arising out of
actions taken in such capacity.

Releases

         Releases by Debtors

         Effective as of the Confirmation Date, but subject to the occurrence of
the Effective Date, and except as otherwise provided in the Plan or the
Confirmation Order, for good and valuable consideration, the adequacy of which
is hereby confirmed, the Debtors and the Reorganized Debtors, in their
individual capacities and as debtors-in-possession, shall be deemed to have
forever released, waived and discharged (i) the agents and Professionals of the
Debtors, (ii) the directors, officers and employees of the Debtors who continue
in such positions subsequent to the Effective Date, (iii) the former directors,
officers and employees of the Debtors, (iv) the members of the Creditors
Committee and its Professionals, (v) GE and (vi) Saratoga, from any and all
claims, obligations, suits, judgments, damages, demands, debts, rights, Causes
of Action and liabilities (other than the rights of the Debtors or the
Reorganized Debtors to enforce the

                                       55



Plan, the Plan Documents, contracts, instruments, releases, indentures and other
agreements or documents delivered thereunder), whether for tort, fraud,
contract, violations of federal or state securities laws, or otherwise, whether
liquidated or unliquidated, fixed or contingent, matured or unmatured, known or
unknown, foreseen or unforeseen, then existing or thereafter arising, in law,
equity or otherwise that are based in whole or part on any act, omission,
transaction, event or other occurrence taking place on or prior to the Effective
Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11
Cases or the Plan; provided, however, that no person identified in subclauses
(i)-(vi) above shall be released or discharged from any Claims, obligations,
suits, judgments, debts or Causes of Action arising out of or in connection with
indebtedness for money borrowed by any such person from the Debtors, or for
goods, services or other consideration provided to such person by the Debtors
pursuant to contract or otherwise, unless otherwise expressly provided for
elsewhere in the Plan; and provided, further, however that the persons
identified in subclause (iii) above shall be released under Section 11.04(a) of
the Plan only for claims, obligations, suits, judgments, damages, rights, Causes
of Action and liabilities with respect to which such persons would be entitled
to indemnification from the Debtors or the Reorganized Debtors under contract or
law.

           Releases by Holders of Claims and Interests

         Effective as of the Confirmation Date, but subject to the occurrence of
the Effective Date, and except as otherwise provided in the Plan or the
Confirmation Order, to the fullest extent permitted under applicable law, in
consideration for the obligations of the Persons set forth below under the Plan
and, if applicable, the cash, securities, contracts, releases and other
agreements or documents to be delivered in connection with the Plan, each Holder
(as well as any trustee or agent on behalf of each such Holder) of a Claim or an
Interest and any Affiliate of any such Holder shall be deemed to have forever
waived, released and discharged (i) the Debtors, (ii) the Reorganized Debtors,
(iii) the agents and Professionals of the Debtors, (iv) the directors, officers
and employees of the Debtors who continue in such positions subsequent to the
Effective Date, (v) the former directors, officers and employees of the Debtors,
(vi) Saratoga, and (vii) the members of the Creditors Committee and its
Professionals from any and all claims, obligations, suits, judgments, damages,
rights, Causes of Action and liabilities, whether for tort, fraud, contract,
violations of federal or state securities laws, or otherwise, whether liquidated
or unliquidated, fixed or contingent, matured or unmatured, known or unknown,
foreseen or unforeseen, then existing or thereafter arising, in law, equity or
otherwise that are based in whole or part on any act, omission, transaction,
event or other occurrence taking place on or prior to the Effective Date
relating to the Debtors, the Reorganized Debtors or any Affiliate of the
Debtors, the Chapter 11 Cases or the Plan, and/or which may have directly or
indirectly impacted or harmed in any way the value of any Claim against or
Interest in the Debtors or their Affiliates; provided, however, that the persons
identified in subclause (v) above shall be released under Section 11.04(b) of
the Plan only for claims, obligations, suits, judgments, damages, rights Causes
of Action and liabilities with respect to which such persons would be entitled
to indemnification from the Debtors or the Reorganized Debtors under contract or
law; provided further, that such waiver, release and discharge shall be
effective as to the above-named released parties (other than the Debtors and the
Reorganized Debtors) only if such Holder affirmatively marked or checked off the
applicable box on the Ballot cast by such Holder indicating such Holder's
agreement to grant such waiver, release and discharge; if such Holder did not
cast a

                                       56



Ballot or did not mark or check off the applicable box on its Ballot, such
Holder shall not be deemed to have granted such waiver, release and discharge as
to such non-Debtor parties.

         Indemnification

         To the extent not inconsistent with the Plan or the Confirmation Order
and to the fullest extent permitted by applicable law, including, without
limitation, the extent provided in our constituent documents, contracts
(including, without limitation, any indemnification agreement), statutory law or
common law, we will indemnify, defend, hold harmless and reimburse the
Exculpated Persons from and against any and all losses, claims, Causes of
Action, damages, fees, expenses, liabilities and actions:

o    for any act taken or omission made in good faith in connection with or in
     any way related to negotiating, formulating, implementing, filing,
     confirming or consummating the Plan, this Disclosure Statement, or any
     contract, instrument, release or other agreement or document created in
     connection with the Plan or the administration of the Chapter 11 Cases; or

o    for any act or omission in connection with or arising out of the
     administration of the Plan or the property to be distributed under the Plan
     or our operations or activities.

         Any Claims of any such Exculpated Persons against us on account of such
indemnification obligations shall be unaltered and Unimpaired within the meaning
of section 1124 of the Bankruptcy Code, but none of the Debtors shall have any
obligation to indemnify any Exculpated Persons for any acts or omissions that
constitute gross negligence or willful misconduct as such is finally determined
by the Bankruptcy Court. Such indemnification obligations shall survive
unaffected by entry of the Confirmation Order, irrespective of whether such
indemnification is owed for an act or event occurring before or after the
Petition Date.

           Revesting of the Debtors

         Subject to the provisions of the Plan and the Confirmation Order, the
Debtors will continue to exist after the Effective Date as the Reorganized
Debtors, with all applicable corporate powers; provided, however, that as soon
as practicable after the Effective Date, the Reorganized Debtors shall cause
Microsun, LRI and ADLT Services to be dissolved or merged into one of the other
Debtors. The property of their respective estates will revest in each of the
Debtors on the Effective Date. From and after the Effective Date, we will be
able to operate our businesses and use, acquire and dispose of property and
compromise or settle any Claims or Interests without supervision or approval by
the Bankruptcy Court and free of any restrictions of the Bankruptcy Code, other
than those restrictions expressly imposed by the Plan and the Confirmation
Order. As of the Effective Date, all of the property of the Debtors and their
subsidiaries will be free and clear of all Claims and Interests, except as
expressly provided in the Plan. Without limiting the foregoing, the Reorganized
Debtors will be able to pay the charges that we incur after the Effective Date
for professionals' fees, disbursements, expenses or related support services
without application to the Bankruptcy Court. Additionally, the Company is
currently analyzing whether after the Effective Date, certain non-debtor
subsidiaries of ADLT, which the Company determines are non-essential, should be
liquidated and/or dissolved.


                                       57



Retention of Jurisdiction

         Exclusive Jurisdiction of Bankruptcy Court

         Notwithstanding the entry of the Confirmation Order, after the
Effective Date, the Bankruptcy Court will retain exclusive jurisdiction of all
matters arising out of, arising in or related to, the Chapter 11 Cases to the
fullest extent permitted by applicable law, including, without limitation,
jurisdiction to:

o    classify or establish the priority or secured or unsecured status of any
     Claim or Interest (whether filed before or after the Effective Date and
     whether or not contingent, disputed or unliquidated) or resolve any dispute
     as to the treatment necessary to reinstate a Claim pursuant to the Plan;

o    grant or deny any applications for allowance of compensation or
     reimbursement of expenses pursuant to sections 330, 331 or 503(b) of the
     Bankruptcy Code or otherwise provided for in the Plan, for periods ending
     on or before the Effective Date;

o    determine and resolve any matters related to the assumption, assumption and
     assignment or rejection of any executory contract or unexpired lease to
     which any of the Debtors is a party or with respect to which any of us may
     be liable, and to hear, determine and, if necessary, liquidate any Claims
     arising therefrom;

o    ensure that all payments due under the Plan and performance of the
     provisions of the Plan are accomplished as provided therein and resolve any
     issues relating to distributions to holders of Allowed Claims, or Allowed
     Interests pursuant to the provisions of the Plan;

o    construe, take any action and issue such orders, prior to and following the
     Confirmation Date and consistent with section 1142 of the Bankruptcy Code,
     as may be necessary for the enforcement, implementation, execution and
     consummation of the Plan and all Plan Documents, contracts, instruments,
     releases, indentures and other agreements or documents created in
     connection with the Plan, including, without limitation, this Disclosure
     Statement and the Confirmation Order, for the maintenance of the integrity
     of the Plan and our protection in accordance with sections 524 and 1141 of
     the Bankruptcy Code following consummation;

o    determine and resolve any cases, controversies, suits or disputes that may
     arise in connection with the consummation, interpretation, implementation
     or enforcement of the Plan (and all Exhibits thereto) or the Confirmation
     Order, including the indemnification and injunction provisions set forth in
     and contemplated by the Plan or the Confirmation Order, or any entity's
     rights arising under or obligations incurred in connection therewith;

o    hear any application of any of the Debtors or the Reorganized Debtors, as
     the case may be, and/or Saratoga to modify the Plan before or after the
     Effective Date pursuant to section 1127 of the Bankruptcy Code and Section
     13.04 of the Plan or modify this Disclosure Statement, the Confirmation
     Order or any contract, instrument, release, indenture or other agreement or
     document created in connection with the Plan, this Disclosure Statement or
     the Confirmation Order, or remedy any defect or omission or

                                       58



     reconcile any inconsistency in any bankruptcy court order, the Plan, this
     Disclosure Statement, the Confirmation Order or any contract, instrument,
     release, indenture or other agreement or document created in connection
     with the Plan, this Disclosure Statement or, the Confirmation Order, in
     such manner as may be necessary or appropriate to consummate the Plan, to
     the extent authorized by the Bankruptcy Code and the Plan;

o    issue injunctions, enter and implement other orders or take such other
     actions as may be necessary or appropriate to restrain interference by any
     entity with consummation, implementation or enforcement of the Plan or the
     Confirmation Order;

o    enter and implement such orders as are necessary or appropriate if the
     Confirmation Order is for any reason modified, stayed, reversed, revoked or
     vacated;

o    determine any other matters that may arise in connection with or relating
     to the Plan, this Disclosure Statement, the Confirmation Order or any
     contract, instrument, release, indenture or other agreement or document
     created in connection with the Plan, this Disclosure Statement or the
     Confirmation Order, except as otherwise provided in the Plan;

o    determine such other matters and for such other purposes as may be provided
     in the Confirmation Order;

o    hear and determine any other matters related to the Plan and not
     inconsistent with Chapter 11 of the Bankruptcy Code;

o    continue to enforce the automatic stay through the Effective Date;

o    hear and determine (i) disputes arising in connection with the
     interpretation, implementation or enforcement of the Plan or (ii) issues
     presented or arising under the Plan, including disputes among holders and
     arising under the Plan Documents, or other agreements, documents or
     instruments executed in connection with the Plan;

o    enter a final decree closing the Chapter 11 Cases or converting them into
     Chapter 7 cases; and

o    determine and resolve any and all controversies relating to the rights and
     obligations of the Old Indenture Trustee, the Voting Agent and the
     Disbursing Agent in connection with the Chapter 11 Cases, including,
     without limitation, any dispute arising in connection with the payment of
     the reasonable fees and expenses of the Old Indenture Trustee, the Voting
     Agent and the Disbursing Agent in connection with their duties in the
     Chapter 11 Cases.

         Non-Exclusive Jurisdiction of Bankruptcy Court

         Following the Effective Date, the Bankruptcy Court will retain
non-exclusive jurisdiction of the Chapter 11 Cases to the fullest extent
permitted by applicable law, including, without limitation, jurisdiction to:


                                       59



o    allow, disallow, determine, liquidate or estimate any Claim or Interest,
     including the compromise, settlement and resolution of any request for
     payment of any Claim, the resolution of any objections to the allowance of
     Claims or Interests and to hear and determine any other issue presented by
     or arising under the Plan, including during the pendency of any appeal
     relating to any objection to such Claim or Interest (to the extent
     permitted under applicable law);

o    recover all our assets and property, wherever located;

o    hear and determine any motions or contested matters involving taxes, tax
     refunds, tax attributes and tax benefits and similar or related matters
     with respect to the Debtors and their respective estates arising prior to
     the Effective Date or relating to the period of administration of the
     Chapter 11 Cases, including, without limitation, matters concerning
     federal, state and local taxes in accordance with sections 346, 505 and
     1146 of the Bankruptcy Code;

o    hear and determine any motions, applications, adversary proceedings,
     contested matters and other litigated matters pending on, filed or
     commenced after the Effective Date that may be commenced by us thereafter,
     including proceedings with respect to our rights to recover property under
     sections 542, 543 or 553 of the Bankruptcy Code, or to bring any Avoidance
     Action, or to otherwise collect to recover on account of any claim or Cause
     of Action that we may have; and

o    hear any other matter not inconsistent with the Bankruptcy Code.

     Alternatives to Confirmation and Consummation of the Plan

         If the Plan is not confirmed by the Bankruptcy Court and consummated,
the alternatives to the Plan include a sale of some or all of our business
operations, a proposal of an alternative plan of reorganization or a liquidation
under Chapter 11 or Chapter 7 of the Bankruptcy Code.

         Sale of Some or All of Debtors' Business Operations

         If the Plan is not confirmed, some or all of the Debtors' business
operations might be sold. We believe that the Plan, as described herein, enables
Holders of Claims and Interests to realize more value than any such sale(s).

         Alternative Plan of Reorganization

         If the Plan is not confirmed, the Debtors, or if our exclusive period
in which to file a plan of reorganization has expired, any other party in
interest, could attempt to formulate a different plan of reorganization. Such a
plan might involve either a reorganization and continuation of our business or a
sale or orderly liquidation of our business. With respect to an alternative
plan, we have explored various other alternatives in connection with the
extensive process involved in the formulation and development of the Plan. We
believe that the Plan, as described herein, enables holders of Claims and
Interests to realize the most value under the circumstances.


                                       60



         Liquidation Under Chapter 7

         If no plan of reorganization can be confirmed (and the sale(s) of the
Company's business divisions do not occur), the Chapter 11 Cases may be
converted to cases under Chapter 7 of the Bankruptcy Code, pursuant to which a
trustee would be elected or appointed to liquidate our assets for distribution
to creditors in accordance with the priorities established by the Bankruptcy
Code. A discussion of the effects that a Chapter 7 liquidation would have on the
recovery of Holders of Claims and Interests is set forth under "-Best Interests
of Creditors Test; Liquidation Value," above. We believe that Holders of
Impaired Claims and Impaired Interests would realize a greater recovery under
the Plan than would be realized under a Chapter 7 liquidation.

                    ACTIONS TAKEN DURING THE CHAPTER 11 CASES

Operations Since Commencement of the Chapter 11 Cases

         From and after the Petition Date, the Debtors have continued to operate
their respective businesses and manage their respective properties as
debtors-in-possession pursuant to sections 1107 and 1108 of the Bankruptcy Code.

         We do not expect the Chapter 11 Cases to be protracted. To expedite our
emergence from Chapter 11, we have sought and obtained, among other things, the
relief detailed below from the Bankruptcy Court. We believe that this relief has
facilitated and will continue to facilitate the orderly administration of the
Chapter 11 Cases.

Relief Requested from the Bankruptcy Court

         Provisions for Prior Lenders

         We previously were a party to a certain credit agreement with the Prior
Lenders, which prior to the Petition Date provided us with certain revolving
credit facilities and other financial accommodations. Borrowings under the
prepetition credit facilities were secured by security interests in
substantially all of our assets and those of certain of our subsidiaries. As of
the Petition Date, the outstanding loan balance under the prepetition credit
facilities was approximately $27 million. Pursuant to (a) the Final Order
Authorizing Debtors-in-Possession to Enter Into Post-Petition Credit Agreement,
Obtain Post-Petition Financing Pursuant to Section 364 of the Bankruptcy Code,
Provide Adequate Protection and Grant Liens, Security Interests and
Superpriority Claims entered by the Bankruptcy Court on March 13, 2003 (the
"Prior DIP Order") and (b) the Final Order Pursuant to Bankruptcy Code Section
364(c) and Bankruptcy Rule 4001 (i) Authorizing Debtors to Obtain Permanent
Post-Petition Financing, Granting Senior Liens and Priority Administrative
Expense Status, Modifying the Automatic Stay, and Authorizing Debtors to Enter
Into Agreements with Foothill Capital Corporation, as Agent, and (ii)
Authorizing Repayment of Pre-Petition and Post-Petition Secured Debt Owing to
PNC Bank, as Existing Agent entered by the Bankruptcy Court on June 25, 2003
(the "Final DIP Order"), the prepetition claims of the Prior Lenders under the
prepetition credit facilities have been paid in full.

         Pursuant to the Prior DIP Order, the Debtors obtained
debtor-in-possession financing from the Prior Lenders. Pursuant to the Final DIP
Order, the debtor-in-possession financing


                                       61



provided by the Prior Lenders has been repaid in full and replaced by the DIP
Facility provided by the Bank Group. Among other things, the Debtors replaced
the debtor-in-possession financing provided by the Prior Lenders with the DIP
Facility provided by the Bank Group in order to eliminate sale covenants in the
Prior DIP Order requiring the Debtors to sell their businesses pursuant to a
schedule concluding July 30, 2003. Neither the Debtors nor the Committees
believed that a sale of the Debtors' businesses was in the best interests of the
Debtors' estates, creditors or equity securityholders.

         Treatment of Employees

         To ensure the continuity of our work force and to further accommodate
the unimpaired treatment of employee benefits, the Debtors sought and obtained
approval of the Bankruptcy Court to honor payroll checks outstanding as of the
date of filing (or to issue replacement checks), to permit employees to utilize
their paid vacation time which was accrued (so long as they remain our
employees), to continue paying medical benefits under the applicable health
plans and to pay severance to terminated employees under certain circumstances,
all in accordance with our existing procedures. Employee Claims and benefits not
paid or honored, as the case may be, prior to the consummation of the Plan will
be paid or honored in full as soon as practicable on or after the Effective Date
or as soon thereafter as such payment or other obligation becomes due or
performable.

         Applications for Retention of the Debtors' Professionals

         The Debtors sought and obtained Bankruptcy Court authority to retain
and employ certain professionals to represent and assist us in connection with
the Chapter 11 Cases. Some of these professionals have been intimately involved
with the negotiation and development of the Plan and include, among others: (i)
Jenner & Block, LLC, as our Chapter 11 counsel; (ii) Cowden, Humphrey, Nagorney
& Lovett, Co. LPA, as our special corporate and securities counsel; (iii) Brown,
Gibbons, Lang & Company Securities, Inc., as our investment bankers and
financial consultants; and (iv) The Parkland Group, Inc., as our financial
consultants.

         Motion to Continue Using Existing Cash Management System

         Because of the administrative hardship that any operating changes would
have been imposed on the Debtors, we sought and obtained Bankruptcy Court
authority to, among other things, continue using our existing cash management
system, bank accounts and business forms and to follow our internal investment
and deposit guidelines. Continued use of the existing cash management system has
facilitated our smooth and orderly transition into Chapter 11, has minimized the
disruption to our businesses while in Chapter 11 and, we believe, will expedite
our emergence from Chapter 11.

         Motion to Pay Critical Vendors

         Because of the critical importance of certain goods and services to our
continued business operations, we sought and obtained Bankruptcy Court
authority, but not the obligation, to pay the prepetition claims of certain
critical vendors. The authority to pay these claims has facilitated our smooth
and orderly transition into Chapter 11 and has minimized the disruption to our
businesses while in Chapter 11.


                                       62



         Motion to Honor Customer Programs and Practices

         We sought and obtained Bankruptcy Court authority to honor the Debtors'
prepetition warranty and rebate programs in favor of customers. The authority to
continue these programs and practices has helped maintain good relations with
customers and, thus, has minimized the disruption to our businesses while in
Chapter 11.

Committees

         In accordance with section 1102(a) of the Bankruptcy Code, the U.S.
Trustee has appointed the Creditors Committee and the Equity Committee in the
Chapter 11 Cases. Under the Plan, the duties and powers of these Committees will
terminate on the Effective Date of the Plan.

            MANAGEMENT, BOARD OF DIRECTORS AND INSIDER RELATIONSHIPS

Management

         Our executive officers will continue to serve after confirmation of the
Plan and completion of the Recapitalization (except as otherwise noted below).
These individuals are:

                   Wayne R. Hellman--Chief Executive Officer (ADLT); President
          (ADLT Services, Ballastronix, LRI and Microsun). On of the Effective
          Date, his annual salary will be $______________, plus bonus and
          benefits.

                   Steven C. Potts--Chief Financial Officer, Treasurer &
          Secretary (ADLT, ADLT Services, Ballastronix, LRI and Microsun); Vice
          President and Chief Financial Officer (APL); Secretary and Treasurer
          (VLI). Mr. Potts' current annual salary is $190,000, plus benefits.
          Mr. Potts is currently scheduled to leave the Company at or about the
          time his replacement joins the Company.

                   Sabu Krishnan--Chief Operating Officer (ADLT) and President
          (VLI). On the Effective Date, his annual salary will be
          $_________________, plus bonus and benefits.

                   Leroy Bartolomei--Vice President (ADLT) and President
          (non-debtor DSI). On of the Effective Date, his annual salary will be
          $___________, plus bonus and benefits.

                   James L.  Schoolenberg--Vice  President  (ADLT);  Chief
          Executive Officer and President (APL). On of the Effective Date, his
          annual salary will be $______________, plus bonus and benefits.

                   Wayne  Platt--Executive  Vice President  (ADLT). On of the
          Effective Date, his annual salary will be $________________, plus
          bonus and benefits.

         Brief biographies of these individuals are set forth under "COMPANY
BACKGROUND AND PURPOSE FOR THE RECAPITALIZATION--Our Management Team."


                                       63



Board of Directors

         Except as noted below, during the Chapter 11 Cases Wayne R. Hellman,
Francis H. Beam, John E. Breen, Theodore Filson, Louis S. Fisi, John Gonzalez,
James Mohn and A. Gordon Tunstall continued as the members of ADLT's Board of
Directors; Sabu Krishnan was appointed to the Board on April 22, 2003. On August
15, 2003, when Saratoga purchased GE's equity interests in and to ADLT, Messrs.
Breen and Mohn (GE's designees to the Board) resigned. Upon such resignations,
the remaining Board members nominated Saratoga representatives Christian
Oberbeck and Damon Ball to fill these Board vacancies subject to their
acceptance thereof. As of the date hereof, Messrs. Oberbeck and Ball had not yet
accepted these positions on the Board.

         From and after the Effective Date, there will be seven (7) members of
Reorganized ADLT's Board of Directors: Wayne Hellman, Sabu Krishnan, Christian
Oberbeck, Damon Ball, Richard Petrocelli and two individuals appointed by
Saratoga in consultation with the Company's management. [The identities and/or
biographies of Reorganized ADLT's Board members will be set forth in the final
version of this Disclosure Statement filed with the Bankruptcy Court.]

         During the Chapter 11 Cases, Wayne R. Hellman has continued as the sole
member of each of the Subsidiary Debtors' respective Board of Directors. The
Board of Directors for each of the Subsidiary Debtors shall consist of one (1)
or more members to be appointed by Reorganized ADLT's Board of Directors.

Management Incentive Plan

         On the Effective Date, the Reorganized Company will adopt and implement
the Management Incentive Plan (the 2003 Equity Incentive Plan of Advanced
Lighting Technologies, Inc.) under which the Management Options will become
effective and will vest, while the recipient continues in our employ, in four
annual installments. Under the Management Incentive Plan, certain members of
Senior Management will be entitled to receive Management Options to purchase in
the aggregate 9.2% of the Fully Diluted New Common Stock, as follows: [The
percentages of New Common Stock or other incentives to be issued to members of
Senior Management will be set forth in the final version of this Disclosure
Statement filed with the Bankruptcy Court.]

         The terms and conditions of the Management Incentive Plan are set forth
on Exhibit A to the Plan.

Senior Management Employment Agreements

         On the Effective Date, we will enter into new employment agreements
with certain members of Senior Management, consisting of Wayne R. Hellman, Sabu
Krishnan, James L. Schoolenberg, Leroy Bartolomei, Wayne Platt and the
individual appointed as the new chief financial officer (to replace Steven
Potts) of ADLT or Reorganized ADLT (as the case may be). The Senior Management
Contracts will provide for the employment of such executives commencing on and
after the Effective Date of the Plan. The Senior Management Contracts are
attached as Exhibits F-1 to F-__ to the Plan. Terms of these contracts include,
without

                                       64



limitation, the following: [The monetary and certain other terms of the
Senior Management Contracts will be set forth in the final versions of this
Disclosure Statement and the contracts themselves filed with the Bankruptcy
Court.]

         The Reorganized Company will implement a retention bonus program
pursuant to which Wayne Hellman will receive a retention bonus payable in two
equal installments on July 1, 2004 and July 1, 2005. [The amount of the
retention bonus to be paid to Hellman will be set forth in the final version of
this Disclosure Statement filed with the Bankruptcy Court.] See "Summary of
Other Provisions of or Relating to the Plan; Treatment of Hellman Loan" above.

Certain Transactions and Relationships with Insiders or Otherwise Related
Parties2

         Pursuant to an agreement dated October 8, 1998, as amended, between
ADLT and its Chairman and Chief Executive Officer, Wayne R. Hellman, ADLT has a
loan recorded for approximately $14,144,000 to Mr. Hellman, including principal
of approximately $12,789,000 and accrued interest as of June 30, 2001;
subsequent accrued interest of $1,503,000 as of June 30, 2003 has not been
recorded due to the uncertainty of Mr. Hellman's available assets to repay the
loan. The proceeds of the loan were used by Mr. Hellman to reduce the principal
balance outstanding of margin loan accounts. In connection with the loan, ADLT
obtained Mr. Hellman's agreement to an extension of his employment agreement to
December 31, 2003. The margin loans have been fully repaid and the loan
agreement prohibits Mr. Hellman from encumbering his ADLT shares in any manner
without the consent of ADLT. On July 26, 2002, ADLT and Mr. Hellman executed an
amendment to the loan documents, implementing the agreement in principle,
reached in January 2002, to extend the maturity of the loan to July 31, 2007.
Under the terms of the amendment, Mr. Hellman was required to sell certain
assets in an orderly manner to maximize the net proceeds to be used to pay a
portion of the loan. In addition, Mr. Hellman agreed to apply any after-tax cash
bonuses earned from ADLT toward repayment of the loan. The loan may be
accelerated if Mr. Hellman ceases to be employed by ADLT as a result of his
voluntary resignation or termination for cause. Pursuant to the Plan,
Reorganized ADLT will forgive the Hellman Loan to the Designated Amount (as
defined above).

         The Company had sales to GE (materials, lamps and lamp components)
totaling approximately $5,903,000 in fiscal year 2002, approximately $7,575,000
in fiscal year 2001 and approximately $7,869,000 in fiscal year 2000. The
Company purchased lamps and raw materials from GE totaling approximately
$3,353,000 in fiscal year 2002, approximately $9,396,000 in fiscal year 2001 and
approximately $13,928,000 in fiscal year 2000. Included in the balance sheet
caption of trade receivables are receivables from GE in the approximately amount
of $2,060,000 at June 30, 2002 and approximately $1,942,000 at June 30, 2001.
Included in the balance sheet caption of trade payables are payables to GE of
approximately $1,962,000 at June 30, 2002 and approximately $3,318,000 at June
30, 2001.

         The Company had fiscal year 2002 sales to Ruud Lighting, Inc.
(primarily lamps and power supplies) totaling approximately $4,134,000
subsequent to ADLT's sale of Ruud Lighting


- -----------------------
         2 Nothing herein shall be or be deemed to be an admission that GE was
or is an insider of the Debtors, and all claims and defenses of the Debtors in
connection therewith are hereby specifically preserved.

                                       65



in December 2001. The Company purchased fixtures from Ruud Lighting totaling
approximately $1,500,000 during the same period. Included in the balance sheet
caption of trade receivables are receivables from Ruud Lighting in the amount of
approximately $1,350,000 at June 30, 2002. Included in the balance sheet caption
of trade payables are payables to Ruud Lighting of approximately $927,000 at
June 30, 2002.

         During May 1998, the Company began to charter airplanes from an
unrelated company. This unrelated company leased the airplanes from an affiliate
of the Company owned by certain officers of the Company. These officers
guaranteed the repayment of approximately $6,400,000 of indebtedness incurred by
the affiliate to purchase the airplanes. The airplanes have been sold and no
further costs related thereto are being incurred. Fees paid by the Company under
these arrangements were approximately $56,000 in fiscal year 2001 and
approximately $474,000 in fiscal year 2000.

         The Company incurred fees for consulting services to two directors of
the Company and to a consulting firm owned by another director of the Company.
Fees paid by the Company under these arrangements totaled approximately $400,000
in fiscal year 2002, $201,000 in fiscal year 2001 and $203,000 in fiscal year
2000.

         The Company sold lamps and lamp components to an overseas company
aggregating approximately $1,373,000 in fiscal year 2001 and approximately
$1,194,00 in fiscal year 2000. The Company purchased lamps from this overseas
company aggregating approximately $1,377,000 in fiscal year 2001 and
approximately $1,108,000 in fiscal year 2000. An executive officer and director
of the overseas company was a director of the Company from January 1996 until
January 2001.

         During fiscal year 1996, one of the Company's subsidiaries sold the
assets of its non-lamp product line to an affiliate of the Company owned
principally by certain officers of the Company for an amount equal to the
carrying amount of such assets as of June 30, 1995. As of June 30, 2002 and
2001, the Company had an 8.5% note from the affiliate for $220,000 related to
the sale of the assets of the non-lamp product line which is recorded as a
long-term receivable from related parties in the consolidated balance sheet.
Total principal and accrued interest at June 30, 2002 was approximately
$322,000.

         The foregoing information relating to transactions and relationships
with insiders or otherwise related parties was derived from the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 2002. This information is
amended and superseded by information contained in our Quarterly Reports on Form
10-Q for the fiscal quarters ended September 30, 2002, December 31, 2002 and
March 31, 2003, and such later information that we may file with the SEC.

         Additionally, in connection with certain consulting services provided
to the Company in 2002 relating to potential refinancing, the Company paid
consulting fees of approximately $580,000 to Tunstall Consulting, Inc., which is
owned and/or controlled by the Company's director, A. Gordon Tunstall.

                                       66



                  ACCOUNTING TREATMENT OF THE RECAPITALIZATION

         Pursuant to the AICPA's Statement of Position No. 90-7, Financial
Reporting by Entities in Reorganization under the Bankruptcy Code ("SOP 90-7"),
fresh-start reporting is adopted by a company undergoing a reorganization under
chapter 11 of the Bankruptcy Code, when the holders of existing voting
securities immediately before confirmation of the plan receive less than 50% of
the voting securities of the emerging entity and the emerging entity's
reorganization value is less than the total of its post-petition liabilities and
allowed claims. The Recapitalization may require the Company to adopt
fresh-start reporting under SOP 90-7 on the basis that holders of Old Common
Stock immediately before the Recapitalization will receive less than 50% of the
New Common Stock to be issued in the Recapitalization (in fact, such holders
will not receive any New Common Stock) and that the Company's estimated
reorganization value for purposes of SOP 90-7 (the approximate fair value of the
entity before considering liabilities) may be less than the Company's
post-petition liabilities and Allowed Claims.

         Fresh-start reporting would require the Company to restate its assets
and liabilities to reflect their reorganization value, which approximates fair
value at the date of the reorganization. In so restating, SOP 90-7 would require
the Company to allocate its reorganization value to its assets based upon their
fair values in accordance with the procedures specified by Accounting Principles
Board (APB) Opinion No. 16, Business Combinations (as superseded by Statement of
Financial Accounting Standards No. 141, Business Combinations), for transactions
reported on the purchase method. Any amount of the reorganization value that
exceeds the amounts allocable to the specific tangible and the identifiable
intangible assets would be allocated to a specific intangible referred to as
"Reorganization value in excess of amounts allocable to identifiable assets"
("Excess Reorganization Value"). This Excess Reorganization Value would be
evaluated for impairment at least annually and whenever there is an impairment
indicator using the fair value guidelines of Statement of Financial Accounting
Standards No. 142, Goodwill and Other Intangible Assets. Each liability existing
on the date the Plan is confirmed by the Bankruptcy Court, other than deferred
taxes, would be stated at the present value of the amounts to be paid,
determined using an appropriate discount rate. Deferred taxes would be reported
in accordance with GAAP. However, any benefits derived from preconfirmation net
operating losses will first reduce the Excess Reorganization Value and other
intangibles until exhausted and thereafter be reported as a direct addition to
additional paid-in capital. Finally, any accounting principle changes required
to be adopted in the financial statements of the Company within the twelve
months following the adoption of fresh-start reporting must be adopted at the
time fresh-start reporting is adopted.

         At the present time, it cannot be determined with certainty whether the
Company's estimated reorganization value for purposes of SOP 90-7 will be less
than the Company's post-petition liabilities and Allowed Claims. However,
fresh-start reporting, if required, should not have a material adverse effect on
the Company's cash flows and, accordingly, should not impact either the
Feasibility Test or the valuation analysis.

         If the Company's estimated reorganization value for purposes of SOP
90-7 is greater than the post-petition liabilities and Allowed Claims, the
accounting for the issuance of equity interests to settle payables would be
accounted for under the provisions of Statement of Financial Accounting
Standards No. 15, Accounting by Debtors and Creditors for Troubled Debt
Restructurings. Under these provisions, equity interests issued in settlement of
the Company's
                                       67



obligations would be accounted for at their fair value. The difference between
the fair value of the equity interests granted and the carrying amount of the
obligations settled, if any, would be recognized as a gain on the restructuring
of the obligations. Additionally, if fresh-start reporting is not applicable,
the carrying amount of assets and liabilities continue to be reflected at their
historical cost. Accounting for a transaction under these circumstances should
not have a material adverse effect on the Company's cash flows and, accordingly,
should not impact either the Feasibility Test or the valuation analysis.

                        FEDERAL INCOME TAX CONSIDERATIONS

         The following summary of certain material federal income tax
consequences of the transactions to be accomplished through the Plan is based
upon the provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), the final, temporary and proposed regulations promulgated thereunder,
and administrative rulings and judicial decisions now in effect, all of which
are subject to change (possibly with retroactive effect) or different
interpretations. The following summary is not binding on the Internal Revenue
Service ("IRS") and there can be no assurance that the IRS will take a similar
view with respect to the tax consequences described below. We have not and will
not request any opinion of counsel or ruling from the IRS regarding any of the
tax matters described. Accordingly, no assurance can be given that the IRS will
not challenge certain of the tax positions described herein or that such a
challenge would not be successful.

         This discussion is for general information only and does not address
all of the possible federal income tax consequences to the Debtors or to any
Holder, and does not address any state, local or foreign tax consequences of the
transactions contemplated in the Plan. Certain taxpayers are subject to special
treatment under the federal income tax laws, including non-U.S. persons, dealers
in securities, insurance companies, financial institutions, banks, tax-exempt
entities, persons who hold securities as a part of a straddle, hedge,
constructive sale, or synthetic security transaction, and persons who are
subject to the alternative minimum tax or whose "functional currency" is not the
U.S. dollar. The discussion below does not apply to any such persons subject to
special treatment under the federal income tax laws; the discussion below
applies only to U.S. taxpayers who hold stock or notes as capital assets within
the meaning of Code Section 1221.

         THE FOLLOWING DISCUSSION IS NOT INTENDED AS TAX ADVICE TO ANY
INDIVIDUAL HOLDER. TAX CONSEQUENCES MAY VARY ACCORDING TO INDIVIDUAL
CIRCUMSTANCES. HOLDERS ARE STRONGLY ADVISED TO SEEK PROFESSIONAL TAX ADVICE
REGARDING THE CONSEQUENCES OF THE PLAN TO THEM IN THEIR PARTICULAR
CIRCUMSTANCES.

Tax Consequences to Holders

         Class 1(a) Claims. Class 1(a) Claims (Miscellaneous Secured Claims) are
Unimpaired and will be paid in Cash (or may be Reinstated or receive such other
treatment as may be agreed in writing). The payment will be treated as interest
to the extent of any accrued interest the Holder has not previously included in
income. The remaining payment will give rise to gain or loss to the Holder to
the extent there is any difference between the amount received and the


                                       68



Holder's adjusted tax basis in the Claim (including accrued but unpaid interest
that has previously been included in the Holder's income).

         In general, any gain or loss will be capital gain or loss, and will be
long term if the Claim has been held for more than one year at the time payment
is received. However, if the Holder of such Claim acquired that Claim at a
market discount, then a portion of any gain, up to the amount of accrued market
discount, will be treated as ordinary interest income.

         Class 1(b) Claims. The Class 1(b) Claims (GE Secured Claims) are
Impaired. Pursuant to the Plan, nothing will be paid directly in respect of the
Class 1(b) Claims. Instead, GE, the Holder of the Class 1(b) Claims, may offset
from amounts it owes to the Debtors (including their nondebtor affiliates) an
amount up to (but not greater than) the Allowed Class 1(b) Claims. Any Allowed
Class 1(b) Claims that remain after giving effect to this offset will be treated
as Class 5 Subsidiary Debtor General Unsecured Claims.

         By reason of the offset, GE will be treated as having received payments
on its Class 1(b) Claims, and as having made payments in respect of amounts it
owes to the Debtors. The tax treatment of amounts deemed paid by GE by reason of
the offset depends on the nature of the debts deemed paid and GE's method of
accounting. Amounts deemed received by GE in respect of its Class 1(b) Claims
will be treated by GE as interest income to the extent of any accrued interest
in respect of such Class 1(b) Claims that GE has not previously included in
income, and the remainder will be treated as payment on such Class 1(b) Claims.
The tax treatment of those payments depends on the original nature of the Class
1(b) Claims and GE's method of accounting, and should not be affected by the
Plan. To the extent Allowed Class 1(b) Claims remain after giving effect to the
offset described above, such Claims will be treated as Class 5 Subsidiary Debtor
General Unsecured Claims. See Class 5 Claims below.

         Class 2 Claims. Class 2 Claims (Classified Priority Claims) are
Unimpaired and will be paid in Cash (or receive such other treatment as may be
agreed in writing). The payment will be treated as interest to the extent of any
accrued interest the Holder has not previously included in income. The remaining
payment will give rise to gain or loss to the Holder to the extent there is any
difference between the amount received and the Holder's adjusted tax basis in
such Claim (including accrued but unpaid interest that has previously been
included in the Holder's income).

         In general, any gain or loss will be capital gain or loss, and will be
long term if the Claim has been held for more than one year at the time payment
is received. However, if the Holder of such Claim acquired that Claim at a
market discount, then a portion of any gain, up to the amount of accrued market
discount, will be treated as ordinary interest income.

         Class 3 Claims. Class 3 Claims (Old Note Claims) are Impaired. Pursuant
to the Plan, each Holder of an Allowed Class 3 Claim will receive New Notes
maturing on September 15, 2010 bearing interest payable semiannually at a rate
of either (i) [__]% per year (if the Plan is approved by Holders of Class 3
Claims) or (ii) the greater of 1.32% per year or such other rate determined by
the Bankruptcy Court (if the Plan is not approved by the Holders of Class 3
Claims). The principal amount of the New Notes will equal (a) the principal
amount of such Old Notes, (b) the amount of interest accrued but unpaid on such
Old Notes from March 16, 2002 to the Petition Date, and (c) interest from the
Petition Date to the Effective Date on the amount equal to the sum of (a) and
(b) above at a rate of either (i) 8% per year (if the Plan is approved by



                                       69



Holders of Class 3 Claims) or (ii) the greater of 1.32% per year or such other
rate determined by the Bankruptcy Court (if the Plan is not approved by the
Holders of Class 3 Claims).

         The Old Notes and the New Notes should be considered "securities" for
purposes of the reorganization provisions of the Code. Accordingly, a portion of
the New Notes will be attributable to unpaid interest that has accrued while the
Holder held the Old Notes (the "interest component"), and the remainder will be
attributable to the principal of the Old Notes (the "principal component"). With
respect to the interest component, the Holder will recognize interest income to
the extent such amounts have not previously been reported as income. The
Holder's tax basis in the entire interest component will be equal to the value
of the interest component, and the holding period will begin upon receipt. With
respect to the principal component, the Holder will not recognize any gain or
loss realized as a result of the exchange. The Holder's tax basis in the
principal component will be equal to such Holder's adjusted tax basis in the Old
Notes (not including any tax basis attributable to accrued interest), and the
holding period of the principal component will include the period during which
the Holder held the Old Notes.

         For purposes of the original issue discount ("OID") rules, the issue
price of the New Notes is equal to the fair market value of the Old Notes on the
date of the Exchange. If the principal amount of the New Notes exceeds the issue
price of the New Notes (which is likely to occur, for example, if the rate of
interest payable on the New Notes is 1.32%), a Holder of New Notes will need to
accrue and take into account OID over the term of the New Notes.

         Some Holders of Old Notes may have acquired the Old Notes at a "market
discount," i.e., for a purchase price that is less than their principal amount.
To the extent New Notes are received in the exchange for Old Notes with market
discount, such New Notes should be treated as market discount bonds with accrued
market discount equal to the amount of market discount accrued on the portion of
the Old Notes exchanged for such New Notes.

          If the New Notes are not considered securities, a Holder of
Old Notes would recognize gain (but not loss) on the exchange to the extent the
New Notes are worth more than the Holder's tax basis in the Old Notes. The
amount of any gain recognized would not be more than the value of the New Notes.
Such gain would generally be capital gain, but would be recharacterized as
ordinary income to the extent of any market discount on the Old Notes or any
accrued but unpaid interest on the Old Notes that has not been taken into
account by the Holder.

         Class 4 Claims. Class 4 Claims (ADLT General Unsecured Claims) are
Impaired. Each Holder of a Class 4 Claim will have the option of electing to
receive either (a) 85% of such Holder's Allowed Class 4 Claim paid at one time
generally shortly after the Effective Date, or (b) 100% of such Holder's Allowed
Class 4 Claim paid in equal quarterly installments generally beginning shortly
after the Effective Date, plus interest accruing on such Claim after the
Effective Date. In addition, each Holder of a Class 4 Claim will receive
interest in cash on such Holder's Allowed Class 4 Claim from the Petition Date
to the Effective Date at a rate of 1.32% per year or such other rate (if greater
than 1.32% per year) determined by the Bankruptcy Court.

         The interest payments should be included in income as interest income,
and the remaining payments should be treated as payments on the Claim. The tax
treatment of those payments depends on the original nature of the Claim and the
Holder's method of accounting,


                                       70



and should not be affected by the Plan. Electing to receive payments over time
may affect the timing and character of any gain that is recognized by a Holder
of a Class 4 Claim in the exchange.

         Class 5 Claims. Class 5 Claims (Subsidiary Debtor General Unsecured
Claims) are impaired. Each Holder of a Class 5 Claim will have the option of
electing to receive either (a) cash equal to 85% of such Holder's Allowed Class
5 Claim paid at one time generally shortly after the Effective Date, or (b) cash
equal to 100% of such Holder's Allowed Class 5 Claim paid in equal quarterly
installments generally beginning shortly after the Effective Date, plus interest
accruing on such Claim after the Effective Date. In addition, each Holder of a
Class 5 Claim will receive interest in cash on such Holder's Allowed Class 5
Claim from the Petition Date to the Effective Date at a rate of 1.32% per year
or such other rate (if greater than 1.32% per year) determined by the Bankruptcy
Court.

         The interest payments should be included in income as interest income,
and the remaining payments should be treated as payments on the Claim. The tax
treatment of those payments depends on the original nature of the Claim and the
Holder's method of accounting, and should not be affected by the Plan. Electing
to receive payments over time may affect the timing and character of any gain
that is recognized by a Holder of a Class 5 Claim in the exchange.

         Class 6 Interests. Class 6 Interests (Old Preferred Stock Interests)
are Impaired. Saratoga holds Class 6 Interests in 761,250 Old Preferred Shares,
which Interests are Allowed. Pursuant to the Plan, in full satisfaction of the
Allowed Class 6 Interests and upon Saratoga's cash payment to ADLT of
$18,000,000, Saratoga will receive 29,000 shares of New Preferred Stock and
1,000 shares of New Common Stock, such that as of the Effective Date Saratoga
will have received 100% of the authorized shares of New Preferred Stock and 100%
of the authorized shares of New Common Stock (90.8% of the Fully Diluted New
Common Stock).

         The New Preferred Stock and New Common Stock received in exchange for
Old Preferred Shares should be treated as part of a tax-free exchange pursuant
to a plan of reorganization, i.e., a recapitalization for tax purposes under
Code Section 368(a)(1)(E), and the New Preferred Stock and New Common Stock
received for cash should be treated as received in exchange for a contribution
to the capital of the Company. Saratoga should not recognize gain or loss or be
deemed to have received a dividend from the Company as a result of the exchange.
Saratoga's tax basis in the New Preferred Stock and New Common Stock will be
equal to the sum of the cash contributed by Saratoga to the Company and
Saratoga's tax basis in the Old Preferred Shares. Basis will be allocated among
the New Preferred Stock and New Common Stock in proportion to the fair market
value of such stock. Saratoga's holding period for the New Preferred Stock and
New Common Stock received for the Old Preferred Shares includes the period
during which Saratoga held the Old Preferred Shares, and its holding period for
the New Preferred Stock and New Common Stock received in exchange for cash
begins on the date Saratoga acquires the New Preferred Stock and New Common
Stock.

         Class 7 Interests. Class 7 Interests (Old Common Stock Interests) are
Impaired. If the Plan is accepted by the Holders of Class 7 Interests (including
Holders of Class 8 Interests other than Saratoga who have exercised their rights
to acquire Old Common Stock), Holders of Class 7 Interests will receive a cash
payment shortly after the Effective Date. If the Plan is not accepted


                                       71



by the Holders of Class 7 Interests, such Holders (including Saratoga) will
receive a cash payment payable in equal quarterly installments beginning shortly
after the Effective Date.

         A Holder of Old Common Stock other than Saratoga will recognize gain or
loss to the extent of the difference between the amount of Cash and such
Holder's adjusted tax basis in the Old Common Stock. In the event the Plan is
not accepted by Holders of Class 7 Interests, a Holder who recognizes gain (and
not loss) in the exchange will (unless such Holder elects otherwise) report such
gain on the "installment method," which generally provides that gain is reported
ratably as payments are received. In general, any gain or loss will be capital
gain or loss, and will be long-term gain or loss with respect to the Old Common
Stock that has been held for more than one year at the time payment is received.
However, a small portion of the Cash received by a Holder of Old Common Stock
who will receive total payments of more than $3000 will be deemed to constitute
interest income, which will be ordinary income in the year it is deemed
received.

         Any cash payment received by Saratoga in respect of its Class 7
Interests will be treated as a dividend to the extent (if any) of the Company's
earnings and profits for its current taxable year. If the cash payment to
Saratoga exceeds the Company's current earnings and profits (or if the Company
has no current earnings and profits), it will be treated first as a return of
capital to the extent of Saratoga's basis in the Old Common Stock, and the
remainder (if any) will be treated as short-term capital gain.

         Class 8 Interests. Class 8 Interests (Old Other Interests, including
any capital stock of ADLT other than Old Common Stock and Old Preferred Stock,
and all outstanding options, warrants, conversion privileges and other legal or
contractual rights to acquire shares of Old Common Stock) are Impaired. Each
Holder of an Old Other Interest will have the right to exercise its options,
warrants, conversion privileges or other legal or contractual rights to obtain
Old Common Stock representing such Interest, which will become fully vested as
of the date of exercise of such right notwithstanding any provision to the
contrary in the contract or instrument giving rise to such Interest. A Holder of
an Old Other Interest will generally not exercise such interest unless the
amount that such Holder must pay to exercise such interest is less than the
amount of Cash to be received in respect of the Old Common Stock received as a
result of such exercise.

         To the extent a Holder of an Old Other Interest received the Interest
for services, such Holder will recognize ordinary income upon the exercise of
the Interest equal to the excess of the fair market value of the Old Common
Stock received over the sum of the exercise price and the amount (if any) paid
to acquire the Old Other Interest. In all other cases, the exercise of such
Holder's rights will not be a taxable event for the Holder. A Holder's adjusted
basis in the Old Common Stock received will be equal to the sum of the exercise
price, plus the amount (if any) paid to acquire the Old Other Interest, plus the
amount of income (if any) recognized as a result of the exercise of the Old
Other Interest.

         Each Holder of an Old Other Interest who exercises such Interest will
be treated, with respect to the Old Common Stock received as a result of such
exercise, as a Holder of a Class 7 Interest. See Class 7 Interests above for
treatment of Holders of Class 7 Interests.

          Class 9 Interests. The Plan contemplates no change for Holders of
Subsidiary Interests.



                                       72



Tax Consequences to the Company

         Tax Recapitalization. The Plan will be considered a "recapitalization"
within the meaning of Code Section 368(a)(1)(E) (the "Tax Recapitalization").
The Tax Recapitalization should not result in gain or loss to the Company. ADLT
will retain its pre-Tax Recapitalization tax attributes, including tax basis and
holding period in assets, and its net operating losses ("NOLs") and capital loss
carryovers ("CLCs").

         Deemed Payment of Class 1(b) Claims. By reason of the offset described
in connection with the satisfaction of Class 1(b) GE Secured Claims above, the
Company will be treated as having received payments in respect of amounts owed
to it by GE, and as having made payments in respect of amounts it owes to GE.
The tax treatment of amounts deemed paid by the Company by reason of the Class
1(b) Claim offset depends on the nature of the obligations deemed paid and the
Company's method of accounting. Amounts deemed received by the Company will be
treated as interest income to the extent (if any) of accrued interest in respect
of such amounts owed by GE that the Company has not previously included in
income, and the remainder will be treated as payment of amounts owed by GE to
the Company. The tax treatment of such payments depends on the nature of the
underlying obligation owed to the Company by GE.

         Payment of Class 4 Claims and Class 5 Claims. As part of the Plan, the
Company will make payments in respect of Class 4 Claims and Class 5 Claims. The
tax treatment of amounts paid by the Company in respect of such Claims depends
on the nature of the Claims and the Company's method of accounting.

         Payment of Interest. As part of the Plan, the Company will make
payments denominated as interest to Holders of Claims of various Classes. Such
payments will give rise to an interest paid deduction for the Company equal to
the amount of cash or fair market value of property paid that is denominated as
interest.

         Limitation on NOLs under Section 382. By reason of Saratoga's
acquisition of the Old Preferred Shares on August 15, 2003, an "ownership
change" for purposes of Sections 382 and 383 of the Code has occurred (i.e., an
ownership change of more than 50% measured by the value of the Company).
Accordingly, our use of NOLs, CLCs, and certain other tax attribute carryovers
and built-in losses at the time of the ownership change (collectively "tax
attributes") is limited to an annual amount equal to (a) the fair market value
of our capital stock immediately after the ownership change, multiplied by (b)
the applicable "long-term tax exempt rate," which is 4.35%.

                             SECURITIES LAW MATTERS

         This Section discusses certain securities law issues that are raised by
the Plan and the Recapitalization. This Section should not be considered
applicable to all situations or to all Holders of Allowed Claims or Allowed
Interests. Such Holders should consult their own legal counsel with respect to
these and other issues.



                                       73



Solicitation of Acceptances of Plan

         The New Notes, New Preferred Stock and New Common Stock to be issued
under the Plan have not been registered with the SEC or any state securities
commission. To the extent the solicitation of votes on the Plan is deemed to
constitute an offer to sell the New Notes, New Preferred Stock and New Common
Stock, we are relying on the exemption from registration provided by section
3(a)(9) of the Securities Act and similar exemptions set forth in applicable
state securities laws. We have no contract, arrangement or understanding
relating to, and will not, directly or indirectly, pay any commission or other
remuneration to any broker, dealer, salesperson, agent, or any other person for
soliciting votes to accept or reject the Plan and the exchange contemplated
thereby. In addition, none of our financial advisors and no broker, dealer,
salesperson, agent or any other person, is engaged or authorized to express any
statement, opinion, recommendation, or judgment with respect to the relative
merits and risks of the Plan and the exchange contemplated thereby.

Issuance and Resale of the New Notes, New Preferred Stock and New Common Stock
Under a Bankruptcy Plan

         We will rely on section 1145 of the Bankruptcy Code to exempt the
issuance of the New Notes, New Preferred Stock, New Common Stock and Management
Options from the registration requirements of the Securities Act (and of any
state securities or "blue sky" laws). Section 1145 exempts from registration the
sale of a debtor's securities under a Chapter 11 plan if such securities are
offered or sold in exchange for a claim against, or equity interest in, or a
claim for an administrative expense in a case concerning, such debtor. In
reliance upon this exemption, the New Notes, New Preferred Stock, New Common
Stock and Management Options generally will be exempt from the registration
requirements of the Securities Act. Accordingly, recipients will be able to
resell the New Notes, New Preferred Stock, New Common Stock and Management
Options without registration under the Securities Act or other federal
securities laws, unless the recipient is an "underwriter" with respect to such
securities, within the meaning of section 1145(b) of the Bankruptcy Code.

         Section 1145(b) of the Bankruptcy Code defines an "underwriter" for
purposes of the, Securities Act as one who (i) purchases a claim with a view to
distribution of any security to be received in exchange for the claim, or (ii)
offers to sell securities issued under a plan for the holders of such
securities, or (iii) offers to buy securities issued under a plan from persons
receiving such securities, if the offer to buy is made with a view to
distribution, or (iv) is a control person of the issuer of the securities.

         We cannot assure you that you will not be deemed to be a statutory
underwriter and you are advised to consult with your own counsel as to the
availability of any exemptions under the Securities Act.

                          DESCRIPTION OF THE OLD NOTES

Material Terms

         The Old Notes were issued pursuant to an Indenture dated as of March
18, 1998 (the "Old Indenture") between ADLT and The Bank of New York (the "Old
Indenture Trustee"). The Old Notes accrue interest at the rate of 8% per annum
payable semi-annually and mature on March 15, 2008. Old Notes with a face amount
of $100 million are currently outstanding.


                                       74



ADLT is the sole obligor on the Old Notes, and therefore the Old Notes are
structurally subordinate to Claims against the Subsidiary Debtors or ADLT's
other subsidiaries. The Old Notes are redeemable at ADLT's option, in whole or
in part, on or after March 15, 2003, at certain defined redemption prices, plus
any accrued and unpaid interest. Prior to March 15, 2001, ADLT had the right to
redeem up to 35% of the principal amount of the Old Notes with the proceeds of
any public equity offering; ADLT did not exercise this redemption right.

         Under the Plan, the Old Notes will be exchanged for the New Notes. The
New Notes will be issued under the New Indenture in the aggregate principal
amount determined pursuant to the applicable formula in Section 3.08 of the
Plan, coming due on September 15, 2010 and bearing interest payable
semi-annually (1) if Class 3 accepts the Plan pursuant to ss. 1129(a)(8)(A) at a
rate per annum of ___%, or (2) if Class 3 does not so accept the Plan then
either (a) at a rate per annum either as stipulated to by the Proponents and the
Creditors Committee at or before the signing of the Confirmation Order by the
Bankruptcy Court or (b) in the event no such stipulation is arrived at, then at
that annual rate determined by the Bankruptcy Court and specified in the
Confirmation Order such that the New Notes will have a value equal to the
Allowed Amount of the Old Note Claims, within the meaning of ss.
1129(b)(2)(B)(i) of the Bankruptcy Code. The New Indenture is annexed as Exhibit
D to the Plan.

                DESCRIPTION OF CAPITAL STOCK AND NEW ARTICLES OF
                INCORPORATION AND CODE OF REGULATIONS (BY-LAWS)

         The current authorized capital stock of ADLT consists of (i) 80,000,000
shares of Old Common Stock, of which 23,807,347 shares are issued and
outstanding, and (ii) 761,250 shares of Old Preferred Stock. Upon Completion of
the Recapitalization, the authorized capital stock of the Company will consist
of 29,000 shares of New Preferred Stock and 80,000,000 shares of New Common
Stock.


                                      75



Old Common Stock and New Common Stock

         Each share of Old Common Stock has, and the New Common Stock will have,
one vote on all matters on which stockholders are entitled or permitted to vote,
including the election of directors and such stockholders do not have cumulative
voting rights. Holders of Old Common Stock are, and Holders of New Common Stock
will be, entitled to share ratably in dividends declared by the Board of
Directors out of funds legally available therefor. We do not expect to declare
or pay cash dividends to Holders of Old Common Stock or New Common Stock in the
foreseeable future. All outstanding shares of Old Common Stock are, and the New
Common Stock issued in the Recapitalization will be, fully paid and
nonassessable and the Holders thereof will have no preferences or conversion,
exchange or pre-emptive rights. In the event of any liquidation, dissolution or
winding-up of the affairs of ADLT, Holders of New Common Stock will be entitled
to share ratably in the assets of ADLT remaining after payment of, or provision
for payment of, all of our debts and obligations, including those arising in
connection with the New Preferred Stock.

Old Preferred Stock and New Preferred Stock

         The current authorized preferred stock of ADLT consists of 761,250
shares of Old Preferred Stock. The Old Preferred Stock is held by Saratoga and
was acquired as set forth below.

         In October 1999, GE completed an investment in ADLT of approximately
$20,554,000. In exchange for the investment, GE received 761,250 shares of the
Old Preferred Stock, which is convertible at any time into 3,045,000 shares of
Old Common Stock (subject to adjustment). GE also received a Warrant (the
"Initial Warrant") to purchase an additional 1,000,000 shares of Old Common
Stock (subject to adjustment), which GE fully exercised to acquire 998,703
shares of Old Common Stock. On August 15, 2003, pursuant to the Saratoga/GE
Stock Purchase Agreement (as defined above), GE sold all of its Old Preferred
Stock and Old Common Stock in ADLT to Saratoga. Saratoga now holds 1,429,590
shares of Old Common Stock. The Old Preferred Stock and the Old Common Stock
held by Saratoga represent approximately 16.7% of the voting power and equity
ownership of ADLT (as of December 31, 2002).

         The Old Preferred Stock has a liquidation preference of $27 per share,
plus an amount equal to 8% per annum compounded annually from the date of
issuance to the date of payment. ADLT is required to redeem any shares of Old
Preferred Stock, which have not been converted or retired on September 30, 2010.
In addition, Saratoga may, by notice, require ADLT to redeem the outstanding Old
Preferred Stock, within one year following either September 30, 2004, or the
occurrence of certain corporate events.

         The terms of the preferred investment provide that ADLT maintain an
interest coverage ratio over certain measurement periods. ADLT failed to
maintain the required interest coverage ratio over three measurement periods. As
a result of the failure to maintain the interest coverage ratio: (i) GE has the
ability to vote the number of shares currently voted by the Chief Executive
Officer of ADLT, Wayne R. Hellman, and Alan J. Ruud, totaling approximately 5.6
million shares of Old Common Stock (as of December 31, 2002), (ii) GE has the
option to purchase shares from Messrs. Hellman and Ruud which, together with the
shares owned by Saratoga, would represent 25% of the voting power of ADLT, (iii)
GE has the right to receive from ADLT an additional warrant to purchase
approximately 6.75 million shares at $.63055 per share (the average of the
closing prices for the 20 trading days ended September 30, 2002), and (iv) GE
has the right to receive from ADLT an additional warrant to purchase
approximately 18,000 shares at $.298 per share (the average of the closing
prices for the 20 trading days ended December 31, 2002. Pursuant to the
Saratoga/GE Stock Purchase Agreement, GE sold its interests in and to these
proxies, purchase rights and warrants to Saratoga subject to obtaining any
required consents. The ability to vote the shares, purchase shares or obtain the
warrants is dependent upon compliance with antitrust laws and other conditions.
Prior to its sale to Saratoga, GE demanded that ADLT issue the two
aforementioned warrants, and ADLT filed a motion seeking authority from the
Bankruptcy Court to do so. At the request of the Debtors and Saratoga, the
Bankruptcy Court has suspended any further proceedings on this motion. GE is not
required to purchase additional shares of ADLT. The number of shares that
Saratoga and/or GE owns or has a right to acquire and/or vote exceeds 35% of the
voting power of ADLT. Consequently, the terms of the Old Indenture relating to
the Old Notes requires that ADLT offer to repurchase the $100 million principal
amount of the outstanding Old Notes at a price of 101% of the principal amount
thereof, plus accrued interest. ADLT elected not to offer to repurchase the Old
Notes and therefore is in default under the Old Indenture.


                                      76



         All shares of the Old Preferred Stock will be cancelled pursuant to the
Plan. In exchange for the Old Preferred Stock and an $18 million Cash infusion
into the Company, Saratoga will be entitled to 100% of the shares of the New
Preferred Stock and 100% of the shares of the New Common Stock issued as of the
Effective Date (90.8% of the Fully Diluted New Common Stock).

         The New Preferred Stock will consist of 29,000 authorized shares of
preferred stock, par value $0.01 per share, of Reorganized ADLT with a fixed
redemption price of $29,000,000 ($1,000 per share) with accrued but unpaid
dividends at 8% per annum, issuable to Saratoga.

         The New Common Stock will consist of 80,000,000 authorized shares of
common stock, par value $0.01 per share, of Reorganized ADLT, having one vote
per share, without preemptive rights or cumulative voting rights.

         The terms of the New Preferred Stock and the New Common Stock are set
forth in the New ADLT Articles of Incorporation which is annexed as Exhibit B to
the Plan.

                 PRICE RANGE OF OLD COMMON STOCK AND DELISTING

         Price Range of Old Common Stock

         The range of the high and low sales prices for each of the fiscal
quarters during the last three fiscal years (as reported by Nasdaq) is set forth
below:

                                                                                                
          Quarter Ended:                                      Quarter Ended:
          --------------                                      --------------
          September 2000                                      March 2002
          High:.................................$19.94        High:......................................$1.94
          Low:..................................$11.31        Low:.......................................$0.56
          December 2000                                       June 2002
          High:.................................$12.81        High:......................................$1.72
          Low:...................................$4.00        Low:.......................................$0.65
          March 2001                                          September 2002
          High:..................................$9.88        High:......................................$1.15
          Low:...................................$4.00        Low:.......................................$0.28
          June 2001                                           December 2002
          High:..................................$6.73        High:......................................$0.45
          Low:...................................$3.90        Low:.......................................$0.10
          September 2001                                      March 2003
          High:..................................$5.86        High:......................................$0.35
          Low:...................................$1.30        Low:.......................................$0.01
          December 2001                                       June 2003
          High:..................................$2.40        High:......................................$0.38
          Low:...................................$1.10        Low:.......................................$0.08



         Limited Trading Market

         The Old Common Stock was delisted on January 10, 2003 pursuant to a
Nasdaq delisting proceeding and is currently traded on the Over-the-Counter
Bulletin Board. On the Effective Date, Reorganized ADLT will deregister as a
registered issuer of equity securities under ss.12(g) of the Exchange Act and
will not list the New Common Stock in any public market. Periodic reporting to
the Commission will be governed by the Indenture for the New Notes and related
regulations.


                                      77



                         IMPORTANT CONTACT INFORMATION

         Any Holder of Claims or Interests who wishes to vote in favor or
against the Plan should complete the Ballot and forward it pursuant to the
instructions contained therein.

         The Voting Agent

         If you have any additional questions, or need additional copies of this
Disclosure Statement, the Ballot or any other Recapitalization materials, please
contact the Voting Agent at the address or telephone number as listed below.

         Bankruptcy Management Corporation
         1330 East Franklin Avenue
         P.O. Box 937
         El Segundo, California  90245-0937
         Attn:  VLI Voting Agent
         Telephone:  (310) 321-5555
         Facsimile:  (310) 640-8071

                          CONCLUSION AND RECOMMENDATION

         WE BELIEVE THAT CONFIRMATION OF THE PLAN IS DESIRABLE AND IN THE BEST
INTEREST OF THE HOLDERS OF CLAIMS AND INTERESTS AS THE PLAN PROVIDES FOR AN
EQUITABLE DISTRIBUTION TO SUCH HOLDERS. ANY ALTERNATIVE TO CONFIRMATION OF THE
PLAN, SUCH AS A SALE(S) OF THE DEBTORS' BUSINESSES, CONVERSION TO A CHAPTER 7
LIQUIDATION OR DISMISSAL OF THE CASE, OR ATTEMPTS BY ANOTHER PARTY IN INTEREST
TO FILE A PLAN, COULD RESULT IN SIGNIFICANT DELAYS, LITIGATION AND COST, AND
LIKELY WOULD RESULT IN SIGNIFICANTLY LESS RECOVERY BY HOLDERS OF CLAIMS AND
INTERESTS.


                                      78



         In light of the significant benefits to be attained by the Holders and
Claims and Interests pursuant to consummation of the transactions contemplated
by the Plan, we recommend that such eligible Holders vote to accept the Plan. We
have reached this decision after considering the alternatives to the Plan that
are available to us and their likely effect on our business operations and
creditors. We determined, after consulting with financial and legal advisors,
that the Plan would result in greater recovery for Holders of Claims and
Interests than would any other Chapter 11 reorganization or liquidation under
Chapter 7. For a comparison of estimated distributions under Chapter 7 of the
Bankruptcy Code and under the Plan, see "Annex C--Liquidation Analysis." For
these reasons, we support the Plan and urge all eligible Holders of Claims and
Interests to accept and support the Plan.

 Dated: The Date Set Forth
        On the Cover Page


Jeff J. Marwil (06194504)
Jerry L. Switzer, Jr. (06210229)
Peter J. Young (06278765)
Jenner & Block, LLC
One IBM Plaza
Chicago, Illinois 60611
(312) 222-9350
(312) 527-0484 (Fax)

Counsel for Debtors and Debtors-in-Possession


                                      79





                                    Annex A
                            to Disclosure Statement
                            -----------------------

                First Amended Chapter 11 Plan of Reorganization1
                -----------------------------------------------









- --------
     1 The Plan included in this Annex A is the version filed with the
Bankruptcy Court on August 15, 2003. Drafts of certain Plan exhibits are being
filed contemporaneously with the Disclosure Statement under a separate cover
and are incorporated herein by reference. No later than one week prior to the
deadline for the filing of objections to this Disclosure Statement (on or
before September 19, 2003), the Debtors and Saratoga intend to file an amended
Plan and amended Plan exhibits to conform to the Disclosure Statement.





                         UNITED STATES BANKRUPTCY COURT
                          NORTHERN DISTRICT OF ILLINOIS
                                EASTERN DIVISION


In re:                              )         Chapter 11
                                    )
VENTURE LIGHTING                    )         Case No.  03-05255
INTERNATIONAL, INC., et al.,        )         (Jointly Administered)
                                    )
                      Debtors.      )         Honorable A. Benjamin Goldgar



                 FIRST AMENDED CHAPTER 11 PLAN OF REORGANIZATION

                                 August 15, 2003

                                 Co-Proponents:

                                   THE DEBTORS
                                       and
                         SARATOGA LIGHTING HOLDINGS LLC


          JENNER & BLOCK, LLC                    DAVIS POLK & WARDWELL
             One IBM Plaza                        450 Lexington Avenue
        Chicago, Illinois 60611                   New York, N.Y. 10017
         Attn.: Jeff J. Marwil                  Attn:  Stephen H. Case1
         Jerry L. Switzer, Jr.                        212-450-4064
            Peter J. Young
            (312) 222-9350

      Counsel for Debtors and                         Counsel for
       Debtors-in-Possession                 SARATOGA LIGHTING HOLDINGS LLC



- --------
1 Not admitted in any Illinois state or federal court






                                  INTRODUCTION

     This first amended plan under chapter 11 of the Bankruptcy Code, dated the
date set forth on the cover page is co-proposed by: (i) ADVANCED LIGHTING
TECHNOLOGIES, INC. and each of its direct and indirect subsidiaries which are
debtors and debtors-in-possession in the above-captioned cases and (ii) SARATOGA
LIGHTING HOLDINGS LLC. Reference is made to the Disclosure Statement
accompanying this Plan for a discussion of the Debtors' history, businesses,
results of operations, historical financial information, properties, projections
for future operations, risk factors, a summary and analysis of this Plan, and
certain related matters, including a description of the New Common Stock to be
issued under this Plan. The Debtors and Saratoga are each proponents of this
Plan within the meaning of section 1129 of the Bankruptcy Code.

     ALL HOLDERS OF CLAIMS AGAINST OR INTERESTS IN THE DEBTORS ARE ENCOURAGED TO
READ THIS PLAN AND THE DISCLOSURE STATEMENT IN THEIR ENTIRETY BEFORE VOTING TO
ACCEPT OR REJECT THIS PLAN. SUBJECT TO CERTAIN RESTRICTIONS AND REQUIREMENTS SET
FORTH IN SECTION 1127 OF THE BANKRUPTCY CODE, BANKRUPTCY RULE 3019 AND IN THIS
PLAN, THE PROPONENTS RESERVE THE RIGHT TO ALTER, AMEND, MODIFY, REVOKE OR
WITHDRAW THIS PLAN PRIOR TO ITS SUBSTANTIAL CONSUMMATION.

     Capitalized terms herein shall have the meanings set forth in Article I
hereof.

Unconsolidated Plan.

     The Debtors have obtained authority from the Bankruptcy Court to have the
Chapter 11 Cases jointly administered for administrative and procedural purposes
only. Accordingly, this Plan is being proposed as a joint plan of reorganization
of the Debtors for administrative and procedural purposes only. This Plan is not
premised upon the substantive consolidation of the Debtors or the Chapter 11
Cases and nothing herein shall be otherwise construed. Claims against, and
Interests in, the Debtors (other than Administrative Claims, Priority Tax Claims
and the DIP Facility Claim) are classified in Article II hereof and treated in
Article III hereof.

                                   ARTICLE I

                    DEFINITIONS, INTERPRETATION AND EXHIBITS

     Section 1.01. Definitions. Unless the context requires otherwise, the
following terms shall have the following meanings whether presented in this Plan
or the Disclosure Statement with initial capital letters or otherwise. As used
herein:

     "ADLT" means the Debtor, Advanced Lighting Technologies, Inc.

     "ADLT General Unsecured Claims" means General Unsecured Claims against
ADLT's Estate (but not against the Subsidiary Debtors' respective Estates).

                                       2



     "ADLT Services" means the Debtor, ADLT SERVICES, INC.

     "Administrative Claim" means a Claim for (a) any cost or expense of
administration (including, without limitation, the fees and expenses of
Professionals) of any of the Chapter 11 Cases asserted or arising under sections
503, 507(a)(1), 507(b) or 1114(e)(2) of the Bankruptcy Code, including, but not
limited to (i) any actual and necessary post-petition cost or expense of
preserving the Debtors' respective Estates or operating the businesses of the
Debtors, (ii) any payment to be made under this Plan to cure a default on an
assumed executory contract or unexpired lease, (iii) any post-petition cost,
indebtedness or contractual obligation duly and validly incurred or assumed by
the Debtors in the ordinary course of their respective businesses, (iv)
compensation or reimbursement of expenses of Professionals to the extent Allowed
by the Bankruptcy Court under sections 330(a) or 331 of the Bankruptcy Code, and
(v) all Allowed Claims that are entitled to be treated as Administrative Claims
pursuant to a Final Order of the Bankruptcy Court under section 546(c)(2)(A) of
the Bankruptcy Code; (b) any U.S. Trustee's Fee Claims; and (c) the reasonable
pre-petition and post-petition fees and expenses of the Old Indenture Trustee.

     "Affiliate" shall have the meaning set forth in section 101(2) of the
Bankruptcy Code and includes ADLT, the Subsidiary Debtors, ADLT's other
subsidiaries and any corporation, limited liability company, joint venture or
partnership in which ADLT or any Subsidiary Debtor directly or indirectly owns,
controls, or holds with the power to vote, 20% or more of the outstanding voting
securities of such entity, as well as any corporation which directly or
indirectly owns, controls, or holds the power to vote 20% or more of the
outstanding voting securities of ADLT or any Subsidiary Debtor.

     "Allowed" means, with respect to any Claim or Interest or portion thereof
(other than a Disputed Claim or a Disputed Interest) (a) as to which the
liability of the Debtors and the amount thereof are agreed to by the Debtors or
the Reorganized Debtors and the Holder of the Claim or Interest, (b) as to which
the liability of the Debtors and the amount thereof are determined by Final
Order of a court of competent jurisdiction, (c) which has been expressly allowed
in a liquidated amount under the provisions of this Plan (but only to the extent
so allowed), (d) which is a Professional Claim for which a fee award amount has
been approved by Final Order of the Bankruptcy Court, (e) which is in an amount
and of the classification and type as set forth in the Debtors' books and
records or (f) which is, in the case of an Interest or any portion thereof only,
held of record as set forth in the books and records maintained by or on behalf
of the applicable Debtor as of the Distribution Record Date.

     "Allowed Claim" means a Claim that is Allowed.

     "Allowed Interest" means an Interest that is Allowed.

     "APL" means the Debtor, APL ENGINEERED MATERIALS, INC.

     "Avoidance Action" means any and all Causes of Action which a trustee,
debtor-in-possession, the estate or other appropriate party in interest may
assert under sections 502, 510, 522(f), 522(h), 542, 543, 544, 545, 547, 548,
549, 550, 551, 553 and 724(a) of the Bankruptcy

                                       3


Code (other than those which are released or dismissed as part of and pursuant
to this Plan), including the Debtors' rights of setoff, recoupment,
contribution, reimbursement, subrogation or indemnity (as those terms are
defined by the non-bankruptcy law of any relevant jurisdiction) and any other
indirect claim of any kind whatsoever, whenever and wherever arising or
asserted.

     "Ballastronix" means the Debtor, BALLASTRONIX (DELAWARE), INC.

     "Ballot" means the ballot, other than a Master Ballot, accompanying the
Disclosure Statement upon which Holders of Impaired Claims and Impaired
Interests entitled to vote on this Plan shall indicate their acceptance or
rejection of this Plan in accordance with the instructions regarding voting.

     "Bank Group" means, collectively, WELLS FARGO FOOTHILL, INC. and ABLECO
FINANCE, L.L.C.

     "Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as codified in
title 11 of the United States Code, 11 U.S.C. ss.ss. 101-1330, as in effect on
the Petition Date, together with all amendments and modifications thereto that
apply to the Chapter 11 Cases.

     "Bankruptcy Court" means the United States Bankruptcy Court for the
Northern District of Illinois, Eastern Division, or, if such court ceases to
exercise jurisdiction over these proceedings, the court or adjunct thereof that
exercises jurisdiction over the Chapter 11 Cases.

     "Bankruptcy Rules" means (i) the Federal Rules of Bankruptcy Procedure and
the Official Bankruptcy Forms, as amended and promulgated under section 2075 of
title 28 of the United States Code, (ii) the Federal Rules of Civil Procedure,
as amended and promulgated under section 2072 of title 28 of the United States
Code, (iii) the Local Rules of the Bankruptcy Court, and (iv) any standing
orders governing practice and procedure issued by the Bankruptcy Court, each as
in effect on the Petition Date, together with all amendments and modifications
thereto that were subsequently made applicable to the Chapter 11 Cases or
proceedings therein, as the case may be.

     "Business Day" means, with respect to any place, any day which is not a
Saturday, a Sunday, a "legal holiday" as defined in Bankruptcy Rule 9006(a), or
a day on which banking institutions conducting business in such place are
authorized or obligated by law, executive order or governmental decree to be
closed.

     "Calendar-Quarter-End Date" means any March 31, June 30, September 30 and
December 31, except that (a) if the Effective Date occurs on or before December
31, 2003 or (b) if the Effective Date is on or after any March 1, June 1,
September 1 or December 1 and on or before the next succeeding March 30, June
30, September 30 or December 31, as the case may be ("Designated Date"), then
neither (c) December 31, 2003 nor (d) such March 31, June 30, September 30 or
December 31 next following a Designated Date shall be deemed a
"Calendar-Quarter-End Date" within the meaning of this Plan.

                                       4


     "Cash" means money, currency and coins, negotiable checks, balances in bank
accounts and other lawful currency of the United States of America and its
equivalents. Payments of Cash under this Plan shall be made by check or
federal-reserve wire transfer.

     "Causes of Action" means any and all actions, claims, rights, defenses,
third-party claims, damages, executions, demands, crossclaims, counterclaims,
suits, causes of action, choses in action, controversies, agreements, promises,
rights to legal remedies, rights to equitable remedies, rights to payment and
claims whatsoever, whether known, unknown, reduced to judgment, not reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, secured or unsecured and whether asserted or assertable
directly, indirectly or derivatively, at law, in equity or otherwise, accruing
to the Debtors, including, but not limited to, the Avoidance Actions.

     "Certificates" has the meaning set forth in Section 5.04 of this Plan.

     "Chapter 11 Cases" means the cases under Chapter 11 of the Bankruptcy Code
commenced by the Debtors in the Bankruptcy Court on the Petition Date.

     "Claim" means (i) any right to payment, whether or not such right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, Disputed, undisputed, legal, equitable, secured or unsecured or (ii)
any right to an equitable remedy for breach of performance if such breach gives
rise to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured, unmatured, Disputed,
undisputed, secured or unsecured.

     "Class" means each class, subclass or category of Claims or Interests as
classified in Article II of this Plan.

     "Classified Priority Claims" means any and all Claims to the extent
entitled to priority under section 507(a) or (b) of the Bankruptcy Code, other
than Administrative Claims and Priority Tax Claims.

     "Commission" means the Securities and Exchange Commission.

     "Committee" means any committee(s) appointed in the Chapter 11 Cases
pursuant to section 1102(a) of the Bankruptcy Code by the United States Trustee,
as the membership of such committee(s) is from time to time constituted and
reconstituted, including, without limitation, the Creditors Committee and the
Equity Committee.

     "Company" means, collectively, the Debtors and their subsidiaries.

     "Confirmation" means the entry by the Bankruptcy Court of the Confirmation
Order.

                                       5


     "Confirmation Date" means the date on which the Clerk of the Bankruptcy
Court enters the Confirmation Order on the docket of the Bankruptcy Court with
respect to the Chapter 11 Cases within the meaning of the Bankruptcy Rules 5003
and 9021.

     "Confirmation Hearing" means the hearing held before the Bankruptcy Court
to consider Confirmation of this Plan pursuant to sections 1128 and 1129 of the
Bankruptcy Code.

     "Confirmation Order" means the order entered by the Bankruptcy Court
confirming this Plan pursuant to section 1129 of the Bankruptcy Code.

     "Creditor" means any Person that is the Holder of any Claim against any of
the Debtors.

     "Creditors Committee" means the Official Committee of Unsecured Creditors
appointed by the United States Trustee on February 13, 2003.

     "day(s)" means, unless expressly otherwise provided, calendar day(s).

     "Debtors" means, collectively, ADLT, VLI, APL, Ballastronix, Microsun, LRI
and ADLT Services, as debtors and debtors-in-possession in the Chapter 11 Cases.

     "DIP Facility" means the debtor-in-possession credit facility provided to
the Debtors during the Chapter 11 Cases as evidenced by and set forth in that
certain post-petition Loan and Security Agreement, and all related agreements
and documents, as thereafter amended and/or assigned, by and among the Debtors,
as borrowers, and the Bank Group, as lenders, as approved by order of the
Bankruptcy Court entered on June 25, 2003.

     "DIP Facility Claim" means the Claim arising under or as a result of the
DIP Facility.

     "Disallowed" means, with respect to any Claim or Interest or portion
thereof, any Claim against or Interest in the Debtors which (a) has been
withdrawn, in whole or in part, by agreement of the Debtors or the Reorganized
Debtors and the Holder thereof, (b) has been withdrawn, in whole or in part, by
the Holder thereof or (c) has been disallowed, in whole or part, by Final Order
of a court of competent jurisdiction. In each case a Disallowed Claim or a
Disallowed Interest is disallowed only to the extent of disallowance or
withdrawal.

     "Disallowed Claim" means a Claim, or any portion thereof, that is
Disallowed.

     "Disbursing Agent" means Reorganized ADLT or such other Entity that is
designated by the Debtors to disburse Property pursuant to this Plan.

     "Disclosure Statement" means the Debtors' Disclosure Statement With Respect
to First Amended Joint Chapter 11 Plan of Reorganization, dated the date set
forth on the cover page thereof, including all exhibits, appendices, schedules
and annexes attached thereto, as submitted by the Proponents, as the same may be
altered, amended, supplemented or modified

                                       6


from time to time, and which was prepared and distributed in accordance with
sections 1125 and 1126(b) of the Bankruptcy Code and Bankruptcy Rule 3018.

     "Disputed" means any Claim or Interest that has been neither Allowed nor
Disallowed.

     "Disputed Claim" means a Claim, or any portion thereof, that is Disputed.
For purposes of this Plan, a Claim that has been neither Allowed nor Disallowed
shall be considered a Disputed Claim.

     "Disputed Interest" means an Interest, or any portion thereof, that is
Disputed.

     "Distribution Record Date" means the record date established by order of
the Bankruptcy Court for purposes of, among other things, determining the
Holders of the Old Notes, the Old Preferred Stock and the Old Common Stock
entitled to (i) receive notices, Ballots and other solicitation materials in
connection with Confirmation of this Plan and the Confirmation Hearing, (ii)
vote to accept or reject this Plan and (iii) receive distributions under this
Plan; provided, however, that Holders of Class 8 Old Other Interests exercising
their rights to acquire Old Common Stock pursuant to the terms of Section 3.13
of this Plan shall be considered to be Holders of Old Common Stock as of the
Distribution Record Date for purposes of receiving distributions under Class 7
pursuant to Section 3.12 of this Plan.

     "DSI" means non-debtor DEPOSITION SCIENCES, INC., a wholly owned subsidiary
of ADLT.

     "Effective Date" means the Business Day that is no more than ten (10)
Business Days in New York, N.Y. following the date on which all conditions to
consummation set forth in Article IX have been satisfied or, if capable of being
duly and expressly waived, any conditions to the occurrence of consummation set
forth in this Plan have been satisfied or waived; provided, however, that the
Effective Date may be extended upon the written approval of each of the Debtors
and Saratoga.

     "Entity" means any individual, corporation, limited or general partnership,
joint venture, association, joint stock company, limited liability company,
estate, entity, trust, trustee, United States Trustee, unincorporated
organization, government, governmental unit (as defined in the Bankruptcy Code),
agency or political subdivision thereof.

     "Equity Committee" means the Official Equity Committee appointed by the
United States Trustee on April 7, 2003.

     "Estates" means the estates created in these Chapter 11 Cases pursuant to
section 541 of the Bankruptcy Code upon commencement of the Chapter 11 Cases.

     "Exchange Act" means the Securities and Exchange Act of 1934, as amended.

                                       7


     "Exculpated Persons" means (i) the directors, officers and employees of the
Debtors in each of the Chapter 11 Cases as of the Petition Date or that have
become officers, directors or employees thereafter but prior to the Effective
Date, (ii) the Debtors' agents and Professionals, (iii) the members of the
Creditors Committee, (iv) the Creditors Committee's Professionals, (v) GE, (vi)
Saratoga and (vii) the respective Affiliates, current and former officers,
directors, employees, agents, stockholders, managers, advisors and professionals
(including the current and former officers, directors, employees, agents,
members, stockholders and professionals of the exculpated Professionals) of the
foregoing exculpated persons identified in subclause (ii) above; provided,
however, that the foregoing exculpated parties identified in subclasses (i)
through (vii) above shall be exculpated only for liabilities arising out of
actions taken in such capacity.

     "File, Filed or Filing" means file, filed or filing with the Bankruptcy
Court in the Chapter 11 Cases.

     "Final Decree" means the final decree entered by the Bankruptcy Court after
the Effective Date and pursuant to section 350(a) of the Bankruptcy Code and
Bankruptcy Rule 3022.

     "Final Order" means an order, ruling, judgment, the operation or effect of
a judgment or other decree issued and entered by the Bankruptcy Court or by any
state or other federal court or other court of competent jurisdiction which has
not been reversed, vacated, stayed, modified or amended and as to which (i) the
time to appeal or petition for review, rehearing, certiorari, reargument or
retrial has expired and as to which no appeal or petition for review, rehearing,
certiorari, reargument or retrial is pending or (ii) any appeal or petition for
review, rehearing, certiorari, reargument or retrial has been finally decided
and no further appeal or petition for review, rehearing, certiorari, reargument
or retrial can be taken or granted.

     "Fully Diluted New Common Stock" means all shares of New Common Stock
issued and outstanding as of the Effective Date and all shares of New Common
Stock issuable under the Management Incentive Plan, but prior to dilution on
account of any other issuances of New Common Stock after the Effective Date.

     "GAAP" means generally accepted accounting principles in the United States
of America in effect from time to time, including, without limitation, those 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 approved by a significant segment of the
accounting profession. All computations contained or referred to shall be
computed in conformity with GAAP applied on a consistent basis.

     "GE" means GENERAL ELECTRIC COMPANY, including its wholly-owned
subsidiaries, successors and assigns.

     "General Unsecured Claims" means all Claims other than Administrative
Claims, Priority Tax Claims, the DIP Facility Claim, Miscellaneous Secured
Claims, Classified

                                       8


Priority Claims and Old Note Claims. General Unsecured Claims consist of ADLT
General Unsecured Claims and Subsidiary Debtor General Unsecured Claims.

     "Saratoga Management Services Agreement" means the management services
agreement among the Reorganized Company and Saratoga whereby the Reorganized
Company shall make an annual payment of $600,000 in the aggregate to Saratoga in
consideration for Saratoga providing management-consulting services to and on
behalf of the Reorganized Company, a copy of which is annexed as Exhibit H to
this Plan.

     "Hellman" means WAYNE R. HELLMAN, ADLT's Chief Executive Officer and
Chairman of the Board.

     "Hellman Loan" means the loan indebtedness and other obligations owed by
Hellman to ADLT pursuant to the Hellman Loan Documents. As of June 30, 2003, the
outstanding indebtedness due under the Hellman Loan was approximately
$15,647,000, consisting of principal of approximately $12,789,000 and interest
of approximately $2,858,000.

     "Hellman Loan Documents" means the Loan Agreement between Hellman and ADLT
dated on or about October 8, 1998, and all related loan documents, including,
without limitation, Secured Promissory Note, Security Agreement, Real Estate
Mortgages, Collateral Assignment of Contract and Allonge No. 2 to Promissory
Note From 24 Karat Street, Inc., as thereafter amended by (a) that certain First
Amendment to Loan Agreement, Secured Promissory Note and Security Agreement
dated on or about November 22, 2000, (b) that certain Second Amendment to Loan
Agreement, Secured Promissory Note and Security Agreement dated on or about
March 15, 2001 and (c) that certain Third Amendment to Loan Agreement, Secured
Promissory Note and Security Agreement dated on or about July 26, 2002.

     "Holder" means an Entity holding a beneficial interest in a Claim or
Interest and, when used in conjunction with a Class or type of Claim or
Interest, means a holder of a beneficial interest in a Claim or Interest in such
Class or of such type.

     "Impaired" means, when used with reference to a Claim or Interest, a Claim
or Interest that is impaired within the meaning of section 1124 of the
Bankruptcy Code.

     "Impaired Claim" means a Claim which is Impaired.

     "Impaired Interest" means an Interest which is Impaired.

     "Intercompany Claims" means all Claims held by any Debtor (or any
subsidiary or Affiliate of any such Debtor) against any or all other Debtors (or
any subsidiary or Affiliate of any such Debtor), including, without limitation,
all derivative Claims asserted by or on behalf of one Debtor against the other.

     "Interests" means any and all equity interests, ownership interests or
shares in the Debtors and issued by the Debtors prior to the Petition Date
(including, without limitation, all capital stock, stock certificates, common
stock, preferred stock, partnership interests, rights,

                                       9


options, warrants, contingent warrants, convertible or exchangeable securities,
investment securities, subscriptions or other agreements and contractual rights
to acquire or obtain such an interest or share in the Debtors, partnership
interests in the Debtors' stock appreciation rights, conversion rights,
repurchase rights, redemption rights, dividend rights, preemptive rights and
liquidation preferences, puts, calls or commitments of any character whatsoever
relating to any such equity, ownership interests or shares of capital stock of
the Debtors or obligating the Debtors to issue, transfer or sell any shares of
capital stock) whether or not certificated, transferable, voting or denominated
"stock" or a similar security.

     "Liens" means, with respect to any asset or Property (or the rents,
revenues, income, profits or proceeds therefrom), and in each case, whether the
same is consensual or nonconsensual or arises by contract, operation of law,
legal process or otherwise: (a) any and all mortgages, liens, pledges,
attachments, charges, leases evidencing a capitalizable lease obligation,
conditional sale or other title retention agreement, or other security interest
or encumbrance or other legally cognizable security devices of any kind in
respect of any asset or Property, or upon the rents, revenues, income, profits
or proceeds therefrom; or (b) any arrangement, express or implied, under which
any Property is transferred, sequestered or otherwise identified for the purpose
of subjecting or making available the same for the payment of debt or
performance of any other obligation in priority to the payment of general
unsecured Creditors.

     "LRI" means the Debtor, LIGHTING RESOURCES INTERNATIONAL, INC.

     "Management Incentive Plan" means the 2003 Equity Incentive Plan of
Advanced Lighting Technologies, Inc. to be adopted by the Reorganized Company on
the Effective Date for the purpose of granting to certain members of Senior
Management the Management Options entitling them to purchase New Common Stock in
an aggregate amount of 9.2% of the Fully Diluted New Common Stock, a copy of
which is annexed as Exhibit A to this Plan.

     "Management Options" means the options to purchase New Common Stock, awards
and other incentives that are to be granted under the Management Incentive Plan
to certain members of Senior Management.

     "Master Ballot" means the ballot provided to a bank, brokerage firm or
other nominee, or agent or proxy holder thereof holding Old Notes or Old Common
Stock in its own name on behalf of a Holder, or any agent thereof, used to
accept or reject this Plan.

     "Microsun" means the Debtor, MICROSUN TECHNOLOGIES, INC.

     "Miscellaneous Secured Claims" means any Secured Claim other than the DIP
Facility Claim.

     "New ADLT By-Laws" means the by-laws of Reorganized ADLT, a copy of which
is annexed as Exhibit C to this Plan.

                                       10


     "New ADLT Certificate of Incorporation" means the certificate of
incorporation of Reorganized ADLT, a copy of which is annexed as Exhibit B to
this Plan.

     "New Common Stock" means the _____________ authorized shares of common
stock, par value $0.01 per share, of Reorganized ADLT, having one vote per
share, without preemptive rights or cumulative voting rights, issued pursuant to
the terms of this Plan and having the terms set forth in the New ADLT
Certificate of Incorporation.

     "New Credit Facility" means either of the following (but only if the same
is reasonably satisfactory to Saratoga in form and substance in all material
respects): (i) the new working capital credit facility that may be entered into
by the Company on or prior to the Effective Date or (ii) the DIP Facility, if
Reinstated by mutual agreement of the Company and the Bank Group.

     "New Indenture" means the Indenture between Reorganized ADLT and the New
Indenture Trustee pursuant to which the New Notes will be issued, a copy of
which is annexed as Exhibit D to this Plan.

     "New Indenture Trustee" means The Bank of New York (or another entity
qualified to act as trustee pursuant to the Trust Indenture Act of 1939, as
amended) in its capacity as trustee under the New Indenture, as designated by
the Proponents.

     "New Notes" means the Senior Notes to be issued under the New Indenture in
the aggregate principal amount determined pursuant to the applicable formula in
Section 3.08, coming due on September 15, 2010 and bearing interest payable
semi-annually (1) if Class 3 accepts this Plan pursuant to ss.1129(a)(8)(A) at a
rate per annum of ___%, or (2) if Class 3 does not so accept this Plan then
either (a) at a rate per annum either as stipulated to by the Proponents and the
Creditors' Committee at or before the signing of the Confirmation Order by the
Bankruptcy Court or (b) in the event no such stipulation is arrived at, then at
that annual rate determined by the Bankruptcy Court and specified in the
Confirmation Order such that the New Notes will have a value equal to the
Allowed Amount of the Claims of the Holders of the Old Notes, within the meaning
of ss.1129(b)(2)(B)(i) of the Bankruptcy Code.

     "New Preferred Stock" means the _____________ authorized shares of
preferred stock, par value $____ per share, of Reorganized ADLT issuable to
Saratoga and having the terms set forth in the New ADLT Certificate of
Incorporation.

     "Objection" means any objection, application, motion, complaint or any
other legal proceeding seeking, in whole or in part, to Disallow, determine,
liquidate, classify, reclassify or establish the priority, expunge, subordinate
or estimate any Claim (including the resolution of any request for payment of
any Administrative Claim) or Interest other than a Claim or an Interest that is
Allowed.

     "Old Common Stock" means all authorized, issued and outstanding shares
(approximately 23,807,347 shares) of common stock of ADLT, par value $0.001 per
share, as of

                                       11


the Petition Date and any contingent, disputed or unliquidated Claims related
thereto or in connection therewith.

     "Old Indenture" means that Indenture dated as of March 18, 1998 between
ADLT and the Old Indenture Trustee pursuant to which the Old Notes were issued.

     "Old Indenture Trustee" means The Bank of New York, in its capacity as
trustee under the Old Indenture.

     "Old Indenture Trustee Claim" has the meaning set forth in Section 7.07 of
this Plan.

     "Old Notes" means the Senior Notes issued under the Old Indenture in the
aggregate principal amount of $100,000,000 bearing interest at an annual rate of
8% payable semi-annually and coming due on March 15, 2008.

     "Old Note Claims" means the Claims of the Holders of the Old Notes
resulting from, arising under or arising in connection with the purchase or sale
of the Old Notes, including, without limitation, the principal and interest in
connection therewith, and any contingent, disputed or unliquidated Claims in
connection therewith.

     "Old Other Interests" means any Interest in ADLT, other than any Old Common
Stock Interest or any Old Preferred Stock Interest, including, without
limitation, any other capital stock of ADLT, and all issued, outstanding and
unexpired options, warrants, conversion privileges or other legal or contractual
rights to acquire shares of Old Common Stock or other Old Other Interests.

     "Old Preferred Stock" means all authorized, issued and outstanding shares
(761,250 shares) of preferred stock of ADLT, par value $0.001 per share, as of
the Petition Date and any contingent, disputed or unliquidated Claims related
thereto or in connection therewith.

     "Person" means and includes a natural person, individual, partnership,
corporation (as defined in section 101(a) of the Bankruptcy Code), or
organization including, without limitation, corporations, limited partnerships,
limited liability companies, general partnerships, joint ventures, joint stock
companies, trusts, land trusts, estate business trusts, unincorporated
organizations or associations, or other organizations, irrespective of whether
they are legal entities, governmental bodies (or any agency, instrumentality or
political subdivision thereof), or any other form of legal entities; provided,
however, "Person" does not include governmental units, except that a
governmental unit that (A) acquires an asset from a Person (i) as a result of
the operation of a loan guarantee agreement or (ii) as receiver or liquidating
agent of a Person; (B) is a guarantor of a pension benefit payable by or on
behalf of a Debtor or an Affiliate of a Debtor; or (C) is the legal or
beneficial owner of an asset of (i) an employee pension benefit plan that is a
governmental plan, as defined in section 414(d) of the Internal Revenue Code of
1986 or (ii) an eligible deferred compensation plan, as defined in section
457(b) of the Internal Revenue Code of 1986, shall be considered for purposes of
section 1102 of the Bankruptcy Code to be a Person with respect to such asset or
such benefit.

                                       12


     "Petition Date" means February 5, 2003, the date on which the Debtors Filed
their petitions for relief commencing the Chapter 11 Cases.

     "Plan" means this First Amended Joint Chapter 11 Plan of Reorganization,
dated the date appearing on the cover page hereof, including all exhibits,
appendices, schedules and annexes attached hereto, as submitted by the
Proponents, as such Plan or any one or more components thereof may be altered,
amended, supplemented or modified from time to time, with the written consent of
both the Debtors and Saratoga in accordance with the provisions of the
Bankruptcy Code, the Bankruptcy Rules, the Confirmation Order and the terms and
conditions of Section 13.04 of this Plan.

     "Plan Documents" means and includes, collectively, the New ADLT Certificate
of Incorporation, the New ADLT By-Laws, the New Credit Facility, the New
Indenture, the Senior Management Contracts, the Management Incentive Plan and
any other documents and agreements required to be executed or delivered under
this Plan on or prior to the Effective Date.

     "Priority Tax Claim" means any and all Claims accorded priority in payment
pursuant to section 507(a)(8) of the Bankruptcy Code.

     "Professional Claim" means a claim for compensation and/or reimbursement of
expenses pursuant to sections 327, 328, 330, 331 or 503(b) of the Bankruptcy
Code relating to services incurred on and after the Petition Date and prior to
and including the Effective Date in connection with an application made to the
Bankruptcy Court in the Chapter 11 Cases.

     "Professionals" means any professional employed in these Chapter 11 Cases
pursuant to sections 327 or 1103 of the Bankruptcy Code or to be compensated
pursuant to sections 327, 328, 330, 331, 503(b)(2) or (4), or 1103 of the
Bankruptcy Code.

     "Property" means all assets or property of the Debtors' respective Estates
of any nature whatsoever, real or personal, tangible or intangible, including
contract rights, accounts and Causes of Action, previously or now owned by the
Debtors, or acquired by the Debtors' Estates, as defined in section 541 of the
Bankruptcy Code.

     "Reinstated or Reinstatement" means (i) leaving unaltered the legal,
equitable, and contractual rights to which a Claim entitles the Holder of such
Claim so as to leave such Claim Unimpaired in accordance with section 1124 of
the Bankruptcy Code or (ii) notwithstanding any contractual provision or
applicable law that entitles the Holder of such Claim to demand or receive
accelerated payment of such Claim after the occurrence of a default (a) curing
any such default that occurred before or after the Petition Date, other than a
default of a kind specified in section 365(b)(2) of the Bankruptcy Code; (b)
reinstating the maturity of such Claim as such maturity existed before such
default; (c) compensating the Holder of such Claim for any damages incurred as a
result of any reasonable reliance by such Holder on such contractual provision
or such applicable law; and (d) not otherwise altering the legal, equitable, or
contractual rights to which such Claim entitled the Holder of such Claim.

                                       13


     "Reorganized ADLT" means ADLT on and after the Effective Date.

     "Reorganized Company" means, collectively, the Debtors and their
subsidiaries on and after the Effective Date.

     "Reorganized Debtors" means the Debtors on and after the Effective Date.

     "Reorganized Subsidiary Debtors" means the Subsidiary Debtors on and after
the Effective Date.

     "Saratoga" means Saratoga Lighting Holdings LLC.

     "Schedule of Rejected Contracts" means the schedule listing executory
contracts and unexpired leases to be rejected by the Debtors (along with the
associated amounts for rejection damage claims), which schedule is to be served
on the counterparties to such executory contracts and unexpired leases, along
with a motion or motions to approve the rejection thereof under section 365(c)
of the Bankruptcy Code, and Filed by the Debtors at least fifteen (15) days
before the date first scheduled by the Bankruptcy Court for the Confirmation
Hearing.

     "Scheduling Motion" means the motion filed, or to be filed, by the Debtors
in the Chapter 11 Cases seeking entry of an order, among other things,
scheduling the Confirmation Hearing, approving notice thereof, establishing
deadlines and procedures for objections to confirmation of this Plan,
establishing procedures for soliciting acceptances of this Plan and establishing
the Record Distribution Date.

     "Secured Claim" means any Claim arising before the Petition Date that is
(a) secured in whole or part, as of the Petition Date, by a Lien which is valid,
perfected and enforceable under applicable law on Property in which the Debtors'
respective Estates has an interest and is not subject to avoidance under the
Bankruptcy Code or applicable non-bankruptcy law, or (b) subject to setoff under
section 553 of the Bankruptcy Code, but, with respect to both case (a) and (b),
only to the extent of the Estate's interest in the value of the assets or
Property securing any such Claim or the amount subject to setoff, as the case
may be.

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

     "Senior Management" means Hellman, SABU KRISHNAN, JAMES L. SCHOOLENBERG,
LEROY BARTOLOMEI, WAYNE PLATT, and the individual appointed as the new chief
financial officer of ADLT or Reorganized ADLT (as the case may be).

     "Senior Management Contracts" means the employment agreements with certain
members of Senior Management to be entered into by the Reorganized Company,
copies of the forms of which are annexed as Exhibits F-1 to F-___ to this Plan.

     "Subsidiary Debtor General Unsecured Claims" means General Unsecured Claims
against one or more of the Subsidiary Debtors' Estates (but not against ADLT's
Estate).

                                       14


     "Subsidiary Debtors" means, collectively, VLI, APL, Ballastronix, Microsun,
LRI and ADLT Services, as debtors and debtors-in-possession in the Chapter 11
Cases.

     "Subsidiary Interests" means any and all authorized, issued and outstanding
Interests in any of the Subsidiary Debtors as of the Petition Date.

     "Tax" means any tax, charge, fee, levy, impost or other assessment by any
federal, state, local or foreign governmental authority, including, without
limitation, income, excise, property, sales, transfer, employment, payroll,
franchise, profits, license, use, ad valorem, estimated, severance, stamp,
occupation and withholding tax, together with any interest, penalties, fines or
additions attributable to, imposed on, or collected by any such federal, state,
local or foreign governmental authority.

     "Termination Date" means February 1, 2004 or such later date as may be
established by the Debtors and Saratoga.

     "Unclaimed Property" means any distribution of Cash or any other Property
made to the Holder of an Allowed Claim or Allowed Interest pursuant to this Plan
that (a) is returned to the Reorganized Debtors as undeliverable and no
appropriate forwarding address is received within the later of (y) one (1) year
after the Effective Date and (z) one (1) year after such distribution is made to
such Holder or (b) in the case of a distribution made in the form of a check, is
not negotiated and no request for reissuance is made as provided for in Section
5.09 of this Plan.

     "Unimpaired" means any Claim that is not Impaired within the meaning of
section 1124 of the Bankruptcy Code.

     "United States Trustee" means the United States Trustee for Region 11
appointed under section 581(a)(3) of title 28 of the United States Code to serve
in the Northern District of Illinois.

     "U.S. Trustee's Fee Claims" means any fees or charges assessed against the
Debtors' respective Estates pursuant to section 1930(a)(6) of title 28 of the
United States Code.

     "VLI" means the Debtor, VENTURE LIGHTING INTERNATIONAL, INC.

     "Voting Agent" means Bankruptcy Management Corporation, which has been
designated by the Bankruptcy Court to (i) receive and tabulate Ballots and
Master Ballots used to accept or reject this Plan in these Chapter 11 Cases,
(ii) file a balloting report and such other documents with the Bankruptcy Court
reflecting and attesting to the tabulation of such Ballots and Master Ballots
and (iii) take such other actions as may be necessary to assist the Debtors and
the Bankruptcy Court to tabulate such Ballots and Master Ballots.

     Section 1.02. Rules of Interpretation. All references to "this Plan" herein
shall be construed, where applicable, to include references to this document and
all its exhibits, appendices, schedules and annexes, if any (and any amendments
thereto made in accordance

                                       15


with the Bankruptcy Code). Whenever from the context it appears appropriate,
each term stated in either the singular or the plural shall include the singular
and the plural, and pronouns stated in the masculine, feminine or neuter gender
shall include the masculine, feminine and the neuter. The words "herein,"
"hereof," "hereto," "hereunder," and other words of similar import refer to this
Plan as a whole and not to any particular paragraph, subparagraph, or clause
contained in this Plan. The words "includes" and "including" shall in all cases
be automatically deemed to have appearing thereafter the words "without
limitation" and are not limiting and mean that the things specifically
identified are set forth for purposes of illustration, clarity or specificity
and do not in any respect qualify, characterize or limit the generality of the
class within which such things are included. The captions and headings in this
Plan are for convenience of reference only and shall not limit or otherwise
affect the provisions hereof. Any term used in this Plan that is not defined in
this Plan, either in Article I hereof or elsewhere, but that is used in the
Bankruptcy Code or the Bankruptcy Rules shall have the meaning assigned to that
term in (and shall be construed in accordance with the rules of construction
under) the Bankruptcy Code or the Bankruptcy Rules (with the Bankruptcy Code
controlling in the case of a conflict or ambiguity). Without limiting the
preceding sentence, the rules of construction set forth in section 102 of the
Bankruptcy Code shall apply to this Plan, unless superseded herein. In computing
any period of time prescribed or allowed by this Plan, the provisions of
Bankruptcy Rule 9006(a) and Section 13.15 hereof shall apply, but Bankruptcy
Rule 9006(a) shall govern.

     Section 1.03. Exhibits. All Exhibits to this Plan are incorporated into and
are a part of this Plan as if set forth in full herein, regardless of when
Filed.

                                   ARTICLE II

                     CLASSIFICATION OF CLAIMS AND INTERESTS

     Section 2.01. Generally. Pursuant to section 1122 of the Bankruptcy Code,
set forth below is a designation of Classes of Claims and Interests. A Claim or
an Interest is classified in a particular Class only to the extent that the
Claim or Interest qualifies within the description of the Class and is
classified in a different Class to the extent the Claim or Interest qualifies
within the description of that different Class. A Claim or Interest is placed in
a particular Class for the purpose of receiving distributions pursuant to this
Plan only to the extent that such Claim or Interest is an Allowed Claim or an
Allowed Interest in that Class and such Claim or Interest has not been paid,
released, settled or otherwise satisfied prior to the Effective Date.

     Section 2.02. Unclassified Claims. In accordance with section 1123(a)(1) of
the Bankruptcy Code, Administrative Claims, Priority Tax Claims and the DIP
Facility Claim are not classified and are excluded from the Classes designated
in this Article II of this Plan. The treatment accorded Administrative Claims,
Priority Tax Claims and the DIP Facility Claim is set forth in Article III of
this Plan.

     Section 2.03. Unimpaired Classes. This Plan classifies the following
Unimpaired Claims and Unimpaired Interests that are not entitled to vote on this
Plan. Pursuant to section 1126(f) of the Bankruptcy Code, each Holder of a Claim
or Interest in the following Classes is conclusively presumed to have accepted
this Plan in respect of such Claims or Interests. Accordingly, Holders of Claims
or Interests in such Classes are not entitled to vote to accept or

                                       16


reject this Plan and the votes of such Holders are not being solicited in
connection with this Plan. Such Claims against and Interests in the Debtors are
classified as follows:

          (a) Class 1(a) shall consist of all Miscellaneous Secured Claims
     ("Class 1(a) Claims" or "Class 1 Miscellaneous Secured Claims").

          (b) Class 2 shall consist of all Classified Priority Claims ("Class 2
     Claims" or "Class 2 Classified Priority Claims").

          (c) Class 9 shall consist of all Subsidiary Interests ("Class 9
     Interests" or "Class 9 Subsidiary Interests").

     Section 2.04. Impaired Classes Entitled to Vote. This Plan classifies the
following Impaired Claims and Impaired Interests that shall receive a
distribution under this Plan that are entitled to vote to accept or reject this
Plan:

          (a) Class 1(b) shall consist of the Secured Claims of GE ("Class 1(b)
     Claims" or "GE Secured Claims").

          (b) Class 3 shall consist of all Old Note Claims ("Class 3 Claims" or
     "Class 3 Old Note Claims").

          (c) Class 4 shall consist of all ADLT General Unsecured Claims ("Class
     4 Claims" or "Class 4 ADLT General Unsecured Claims").

          (d) Class 5 shall consist of all Subsidiary Debtor General Unsecured
     Claims ("Class 5 Claims" or "Class 5 Subsidiary Debtor General Unsecured
     Claims").

          (e) Class 6 shall consist of all Interests of the Holders of Old
     Preferred Stock ("Class 6 Interests" or "Class 6 Preferred Interests").

          (f) Class 7 shall consist of all Interests of Holders of Old Common
     Stock ("Class 7 Interests" or "Class 7 Common Interests").

          (g) Class 8 shall consist of all Interests of Holders of Old Other
     Interests ("Class 8" or "Class 8 Other Interests").

     If a Holder of a Class 8 Old Other Interest exercises its right to obtain
Old Common Stock on account of its Old Other Interest as provided in Section
3.13 of this Plan, such Holder shall be entitled to the treatment provided to
Class 7 in Section 3.12 of this Plan with respect to such Old Common Stock. If
such Holder fails to timely exercise its right to obtain Old Common Stock, such
Holder's Old Other Interest shall be canceled and extinguished and such Holder
shall not receive or retain any property under this Plan on account of such
Interest; in such event, pursuant to section 1126(g) of the Bankruptcy Code,
such Holder shall be conclusively presumed to have rejected this Plan in respect
of such Interest (even if such Holder cast a Ballot accepting this Plan) because
this Plan does not entitle the Holders of such Interests to receive or retain
any property under this Plan on account of such Interests.

                                       17


                                  ARTICLE III

                     PROVISIONS FOR TREATMENT OF CLASSES OF
                              CLAIMS AND INTERESTS

     Section 3.01. Satisfaction of Claims and Interests. The treatment of and
consideration to be received by Holders of Allowed Claims or Allowed Interests
pursuant to this Article III and this Plan shall be in full satisfaction,
settlement, release, extinguishment and discharge of their respective Claims
against or Interests in the Debtors and the Debtors' respective Estates, except
as otherwise provided in this Plan or the Confirmation Order.

     Section 3.02. Unclassified Claims, Classified Unimpaired and Impaired
Claims and Classified Interests. Administrative Claims and Priority Tax Claims
are treated in accordance with section 1129(a)(9)(A) and section 1129(a)(9)(C)
of the Bankruptcy Code, respectively. Such Claims, as well as the DIP Facility
Claim, are Unimpaired under this Plan and, in accordance with section 1123(a)(1)
of the Bankruptcy Code, are not designated as Classes of Claims for purposes of
this Plan and for purposes of sections 1123, 1124, 1126 and 1129 of the
Bankruptcy Code. In addition, the Class 1(a) Miscellaneous Secured Claims, Class
2 Classified Priority Claims and Class 9 Subsidiary Interests are classified as
Classes of Claims or Interests that are Unimpaired and, in accordance with
section 1126(f) of the Bankruptcy Code, such Classes are conclusively presumed
to have accepted this Plan and are not entitled to vote to accept or reject this
Plan. Class 1(b) Secured Claims, Class 3 Old Note Claims, Class 4 ADLT General
Unsecured Claims, Class 5 Subsidiary Debtor General Unsecured Claims, Class 6
Preferred Interests, Class 7 Common Interests and Class 8 Old Other Interests
are Impaired and are entitled to vote to accept or reject this Plan. If a Holder
of a Class 8 Old Other Interest exercises its right to obtain Old Common Stock
on account of its Old Other Interest as provided in Section 3.13 of this Plan,
such Holder shall be entitled to the treatment provided to Class 7 in Section
3.12 of this Plan with respect to such Old Common Stock. If such Holder fails to
timely exercise its right to obtain Old Common Stock, such Holder's Old Other
Interest shall be canceled and extinguished and such Holder shall not receive or
retain any property under this Plan on account of such Interest; in such event,
pursuant to section 1126(g) of the Bankruptcy Code, such Holder shall be
conclusively presumed to have rejected this Plan in respect of such Interest
(even if such Holder cast a Ballot accepting this Plan) because this Plan does
not entitle the Holders of such Interests to receive or retain any property
under this Plan on account of such Interests.

     Section 3.03. Administrative Claims. Administrative Claims are Unimpaired.
Unless otherwise provided for herein and unless already paid pursuant to prior
order of the Bankruptcy Court or applicable law, each Holder of an Allowed
Administrative Claim shall receive in full satisfaction, settlement, release,
extinguishment and discharge of such Claim: (A) the amount of such unpaid
Allowed Claim in Cash on or as soon as reasonably practicable after the later of
(i) the Effective Date, (ii) the date on which such Administrative Claim becomes
Allowed and (iii) a date agreed to in writing by the Debtors or the Reorganized
Debtors, as the case may be, and the Holder of such Administrative Claim; or (B)
such other treatment on such other terms and conditions as may be agreed upon in
writing by the Holder of such Claim and the Debtors or the Reorganized Debtors,
as the case may be, or as the Bankruptcy Court may order.

                                       18


     Section 3.04. Priority Tax Claims. Priority Tax Claims are Unimpaired. Each
Holder of an Allowed Priority Tax Claim shall receive, at the option of the
Debtors or the Reorganized Debtors, as the case may be, in full satisfaction,
settlement, release, extinguishment and discharge of such Claim: (A) the amount
of such unpaid Allowed Claim in Cash on or as soon as reasonably practicable
after the later of (i) the Effective Date, (ii) the date on which such Priority
Tax Claim becomes Allowed and (iii) a date agreed to by the Debtors or the
Reorganized Debtors, as the case may be, and the Holder of such Priority Tax
Claim; (B) equal Cash payments from the Reorganized Debtors made on the last
Business Day of every three (3) month period following the Effective Date, over
a period not exceeding six (6) years after the assessment of the tax on which
such Claim is based, totaling the principal amount of such Claim plus simple
interest on any outstanding balance from the Effective Date calculated at the
interest rate publicly quoted on the Effective Date for obligations backed by
the full faith and credit of the United States of America maturing in ninety
(90) days; or (C) such other treatment on such other terms and conditions as may
be agreed upon in writing by the Holder of such Claim and the Debtors or the
Reorganized Debtors, as the case may be, or as the Bankruptcy Court may order.
The Debtors or the Reorganized Debtors, as the case may be, shall have the
right, in their sole discretion, to prepay at any time any Allowed Priority Tax
Claim without premium or penalty of any sort or nature.

     Section 3.05. DIP Facility Claim. The DIP Facility Claim is Unimpaired. On
the later of (i) the Effective Date, (ii) the date on which the DIP Facility
Claim becomes Allowed and (iii) such other date agreed to by the Debtors or the
Reorganized Debtors, as the case may be, and the Holders of the DIP Facility
Claim, the Holders of the Allowed DIP Facility Claim shall receive in full
satisfaction, settlement, release and discharge of and in exchange for such
Allowed DIP Facility Claim: (A) Cash equal to the unpaid portion of such Allowed
DIP Facility Claim; or (B) such other treatment on such other terms and
conditions as may be agreed upon in writing by the Holders of such Claim and the
Debtors or the Reorganized Debtors, as the case may be, including, without
limitation, Reinstatement of such Claim, or as the Bankruptcy Court may order.

     Section 3.06. (a) Class 1(a) Claims: Miscellaneous Secured Claims. Class
1(a) Miscellaneous Secured Claims are Unimpaired. Each Holder of an Allowed
Class 1(a) Miscellaneous Secured Claim shall receive, in the sole discretion of
the Debtors or the Reorganized Debtors, as the case may be, in full
satisfaction, settlement, release, extinguishment and discharge of such Claim:
(A) Cash equal to the amount of such Allowed Miscellaneous Secured Claim on or
as soon as practicable after the later of (i) the Effective Date, (ii) the date
that such Miscellaneous Secured Claim becomes Allowed and (iii) a date agreed to
by the Debtors or the Reorganized Debtors, as the case may be, and the Holder of
such Claim; (B) treatment such that such Miscellaneous Secured Claim is
Reinstated; or (C) such other treatment on such other terms and conditions as
may be agreed upon in writing by the Holder of such Claim and the Debtors or the
Reorganized Debtors, as the case may be, or as the Bankruptcy Court may order.

         Section 3.06. (b) Class 1(b) Claims: Secured Claims of GE. Class 1(b)
GE Secured Claims are Impaired. The Class 1(b) GE Secured Claims shall receive
nothing on the Effective Date, provided, however, on the Effective Date, or as
soon thereafter as the GE Secured Claims are Allowed, GE may offset from the
amounts owing by GE to the Debtors, including the

                                       19


Debtors' nondebtor affiliates, and indefeasibly retain for GE's own account, an
amount up to, but not in excess of, the Allowed Amount of the GE Secured Claims.
If, after giving effect to the offset provided in this Section 3.06(b), GE has
any remaining Claims against the Debtors, such Claims of GE shall be treated as
Class 5 Subsidiary Debtors General Unsecured Claims. Except to the extent of the
offset permitted under this Section 3.06(b), nothing in this Section 3.06(b)
shall be or be deemed to be a waiver or release of any claim belonging to the
Debtors or their nondebtor affiliates against GE.

     Section 3.07. Class 2 Claims: Classified Priority Claims. Class 2
Classified Priority Claims are Unimpaired. To the extent that these Claims have
not already been paid pursuant to prior order of the Bankruptcy Court, each
Holder of an Allowed Class 2 Classified Priority Claim shall receive in full
satisfaction, settlement, release, extinguishment and discharge of such Claim:
(A) the amount of such unpaid Allowed Claim in Cash on or as soon as reasonably
practicable after the later of (i) the Effective Date, (ii) the date on which
such Class 2 Claim becomes Allowed and (iii) a date agreed to by the Debtors or
the Reorganized Debtors, as the case may be, and the Holder of such Class 2
Claim; or (B) such other treatment on such other terms and conditions as may be
agreed upon in writing by the Holder of such Claim and the Debtors or the
Reorganized Debtors, as the case may be, or as the Bankruptcy Court may order.

     Section 3.08. Class 3 Claims: Old Note Claims. The Old Note Claims are
Allowed as follows:

     (A) if Class 3 accepts this Plan pursuant to ss.1129(a)(8)(A) of the
Bankruptcy Code, such Old Note Claims shall be Allowed in an aggregate amount
equal to the sum of (i) $__________ (being the sum of $100,000,000 plus interest
at 8% from March 1, 2002 to the Petition Date) plus (ii) interest on the amount
mentioned in (A)(i) of this section 3.08 from the Petition Date to the Effective
Date at the rate of 8% per annum, or

     (B) if Class 3 does not so accept this Plan, then such Old Note Claims
shall be Allowed in an aggregate amount equal to (i) $__________ (being the sum
of $100,000,000 plus interest at 8% from March 1, 2002 to the Petition Date)
plus (ii) interest on the amount mentioned in (B)(i) of this section 3.08 from
the Petition Date to the Effective Date at that rate per annum which is the
greater of:

          (1) 1.32% (such rate being (a) the weekly average 1-year constant
     maturity Treasury yield, as published by the Board of Governors of the
     Federal Reserve System for the week ending Friday January 31, 2003, the end
     of the calendar week preceding the Petition Date, and (b) specified as the
     interest rate allowed on judgments entered in federal courts pursuant to 28
     U.S.C. ss.1961 and reported on the following site on the internet:
     http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt),

          (2) such other rate per annum as the Bankruptcy Court determines is
     legally required by the applicable provisions of the Bankruptcy Code for
     accruals of post-petition interest on unsecured debt.

     Class 3 Old Note Claims are Impaired. On or as soon as practicable after
the Effective Date, each Holder of an Allowed Old Note Claim as of the
Distribution Record Date shall

                                       20


receive from the Disbursing Agent, in full satisfaction, settlement, release,
extinguishment and discharge of such Claim, for each $1,000 in principal amount
of Old Notes held by such Holder: (a) a New Note in a principal amount equal to:

          (A) the unpaid principal amount of such Old Note plus

          (B) the amount of interest accrued but unpaid on such Old Note from
     March 1, 2002 to the Petition Date plus

          (C) interest on an amount equal to the sum of (A) and (B) in this
     sentence from the Petition Date to the Effective Date at the applicable
     rate as provided above in Section 3.08 (A) or (B).

     Acceptance of this Plan by Class 3 shall, subject to consummation of this
Plan, constitute a waiver by all Holders of Class 3 Old Note Claims of any and
all defaults under the Old Indenture that may exist as of the Effective Date,
and an agreement to instruct the Old Indenture Trustee to take all actions to
effectuate this Plan.

     Section 3.09. Class 4 Claims: ADLT General Unsecured Claims. The Class 4
ADLT General Unsecured Claims are Impaired. Each Holder of Class 4 ADLT General
Unsecured Claims shall be entitled to receive interest on the Allowed Amount of
such Holder's claim from the Petition Date to the Effective Date at that rate
per annum which is the greater of:

          (1) 1.32% (such rate being (a) the weekly average 1-year constant
     maturity Treasury yield, as published by the Board of Governors of the
     Federal Reserve System for the week ending Friday January 31, 2003, the end
     of the calendar week preceding the Petition Date, and (b) specified as the
     interest rate allowed on judgments entered in federal courts pursuant to 28
     U.S.C. ss.1961 and reported on the following site on the internet:
     http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

          (2) such other rate per annum as the Bankruptcy Court determines is
     legally required by the applicable provisions of the Bankruptcy Code for
     accruals of post-petition interest on unsecured debt.

     The Holder of each Class 4 ADLT General Unsecured Claim shall have an
election to accept either "85% Now Treatment" or "100% Stretch Treatment," as
described in ensuing sentences in this Section 3.09. Such election shall be
exercised by each such Holder (including Holders of Disputed Class 4 Claims,
whether or not the proceedings to determine the Allowed Amount of such Holder's
Disputed ADLT General Unsecured Claim shall have been concluded at the Effective
Date), pursuant to election forms which will be mailed to each such Holder by
Reorganized ADLT within five Cleveland, Ohio Business Days after the Effective
Date, subject to the requirement that each Holder who fails to have made its
election and to have caused its fully completed election form to have been
actually received by the Reorganized Debtors by 5:00 p.m. Cleveland time on the
20th Cleveland, Ohio Business Day after the Effective Date shall be conclusively
deemed to have elected 85% Now Treatment.

     Each Holder who shall have elected 85% Now Treatment (or who shall have
been automatically deemed to have made such election) shall be entitled to
receive on the later of:

                                       21


          (1) 45 days after the Effective Date,

          (2) the date on which such Holder's ADLT Class 4 General Unsecured
     Claim shall have become Allowed,

          (3) the date on which such ADLT Class 4 General Unsecured Claim, or
     any portion thereof, shall be paid pursuant to the established ordinary
     course of business or dealings between ADLT and the Holder of such Claim,
     and

          (4) such other date agreed to by the Debtors or the Reorganized
     Debtors, as the case may be, and the Holder of such Class 4 ADLT General
     Unsecured Claim, an amount in cash equal to 85% of the Allowed Amount of
     such Holder's Class 4 ADLT General Unsecured Claim.

     Holders who shall have elected 100% Stretch Treatment shall be entitled to
receive, starting on the later of:

          (1) the first Calendar-Quarter-End Date after the Effective Date, and

          (2) the Calendar-Quarter-End Date next following the date on which
     each such ADLT Class 4 General Unsecured Claim shall have become Allowed,
     and on each of the next succeeding Calendar-Quarter-End Dates thereafter,
     until such Allowed Class 4 ADLT General Unsecured Claim is paid in full, an
     amount in cash equal to 25% of the Allowed Amount of such Holder's Class 4
     ADLT General Unsecured Claim, with the further understanding that on the
     364th day after the Effective Date of this Plan, each Holder who shall have
     elected 100% Stretch Treatment shall receive the entire then-unpaid balance
     of its Class 4 ADLT General Unsecured Claim, except that Holders of Claims
     that shall have elected 100% Stretch Treatment remain Disputed Class 4 ADLT
     General Unsecured Claims on such 364th day shall be entitled to receive
     100% of their Allowed Claim on the date of Allowance thereof.

     All payments to Holders of Class 4 ADLT General Unsecured Claims shall be
made in Cash, unless otherwise agreed between Reorganized ADLT and the Holder of
such Claim.

     Section 3.10. Class 5 Claims: Subsidiary Debtor General Unsecured Claims.
The Class 5 Subsidiary Debtor General Unsecured Claims are Impaired. Each Holder
of Class 5 Subsidiary Debtor General Unsecured Claims shall be entitled to
receive interest on the Allowed Amount of such Holder's claim from the Petition
Date to the Effective Date at that rate per annum which is the greater of:

          (1) 1.32% (such rate being (a) the weekly average 1-year constant
     maturity Treasury yield, as published by the Board of Governors of the
     Federal Reserve System for the week ending Friday January 31, 2003, the end
     of the calendar week preceding the Petition Date, and (b) specified as the
     interest rate allowed on judgments entered in federal courts pursuant to 28
     U.S.C. ss.1961 and reported on the following site on the internet:
     http://www.federalreserve.gov/releases/H15/data/wf/tcm1y.txt), or

                                       22


          (2) such other rate per annum as the Bankruptcy Court determines is
     legally required by the applicable provisions of the Bankruptcy Code for
     accruals of post-petition interest on unsecured debt.

     The Holder of each Class 5 Subsidiary Debtor General Unsecured Claim shall
have an election to accept either "85% Now Treatment" or "100% Stretch
Treatment," as described in ensuing sentences in this Section 3.10. Such
election shall be exercised by each such Holder (including Holders of Disputed
Claims, whether or not the proceedings to determine the Allowed Amount of such
Holder's Disputed Class 5 Subsidiary Debtor General Unsecured Claim shall have
been concluded at the Effective Date), pursuant to election forms which will be
mailed to each such Holder by Reorganized ADLT within five Cleveland, Ohio
Business Days after the Effective Date, subject to the requirement that each
Holder who fails to have made its election and to have caused its fully
completed election form to have been actually received by the Reorganized
Debtors by 5:00 p.m. Cleveland time on the 20th Cleveland, Ohio Business Day
after the Effective Date shall be conclusively deemed to have elected 85% Now
Treatment.

     Each Holder who shall have elected 85% Now Treatment (or who shall have
been automatically deemed to have made such election) shall be entitled to
receive on the later of:

          (1) 45 days after the Effective Date,

          (2) the date on which such Holder's Class 5 Subsidiary Debtor General
     Unsecured Claim shall have become Allowed,

          (3) the date on which such Class 5 Subsidiary Debtor General Unsecured
     Claim, or any portion thereof, shall be paid pursuant to the established
     ordinary course of business or dealings between ADLT and the Holder of such
     Claim, and

          (4) such other date agreed to by the Debtors or the Reorganized
     Debtors, as the case may be, and the Holder of such Class 5 Subsidiary
     Debtor General Unsecured Claim, an amount in cash equal to 85% of the
     Allowed Amount of such Holder's Class 5 Subsidiary Debtor General Unsecured
     Claim.

     Holders who shall have elected 100% Stretch Treatment shall be entitled to
receive, starting on the later of:

          (1) the first Calendar-Quarter-End Date after the Effective Date, and

          (2) the Calendar-Quarter-End Date next following the date on which
     each such Class 5 Subsidiary Debtor General Unsecured Claim shall have
     become Allowed, and on each of the next succeeding Calendar-Quarter-End
     Dates thereafter, until such Allowed Class 5 Subsidiary Debtor General
     Unsecured Claim is paid in full, an amount in cash equal to 25% of the
     Allowed Amount of such Holder's Class 5 Subsidiary Debtor General Unsecured
     Claim, with the further understanding that on the 364th day after the
     Effective Date of this Plan, each Holder who shall have elected 100%
     Stretch Treatment shall receive the entire then-unpaid balance of its Class
     5 Subsidiary Debtor General Unsecured Claim, except that Holders of Claims
     that shall have elected 100% Stretch Treatment remain Disputed Class 5
     Subsidiary Debtor General Unsecured Claims on

                                       23


     such 364th day shall be entitled to receive 100% of their Allowed Claim on
     the date of Allowance thereof.

     All payments to Holders of Class 5 Subsidiary Debtor General Unsecured
Claims shall be made in Cash, unless otherwise agreed between Reorganized ADLT
and the Holder of such Claim.

     Section 3.11. Class 6 Interests: Old Preferred Stock Interests. Class 6
Preferred Interests are Impaired. Saratoga holds Class 6 Interests in 761,250
Old Preferred Shares; such Interests of Saratoga are hereby Allowed. On or as
soon as practicable after the Effective Date, Saratoga, the Holder of the
Allowed Class 6 Preferred Interest as of the Distribution Record Date shall
receive, in full satisfaction, settlement, release, extinguishment and discharge
of such Preferred Interest, upon payment in cash to ADLT in cash by wire
transfer of immediately available funds, $18,000,000, ___________ shares of New
Preferred Stock and ______ shares of New Common Stock, such that the Holders of
the Allowed Class 6 Preferred Interests shall have received 100% of the
authorized shares of New Preferred Stock, all of which are to be outstanding on
the Effective Date and held by Saratoga, 100% of the shares of New Common Stock
issued and outstanding on the Effective Date and 91.8% of the Fully Diluted New
Common Stock. Acceptance of this Plan by Class 6 shall, subject to consummation
of this Plan, constitute an approval, as recipient of New Common Stock, of the
Management Incentive Plan, the Senior Management Contracts and the
reincorporation of ADLT as a Delaware corporation.

     Section 3.12. Class 7 Interests: Old Common Stock Interests. Class 7 Common
Interests are Impaired. If Class 7 accepts this Plan pursuant to ss.1129(a)(8)
of the Bankruptcy Code then, on or as soon as practicable after the Effective
Date, each Holder of an Allowed Class 7 Interest as of the Distribution Record
Date (and any Holders in Class 8, other than Saratoga, electing to exercise
their rights as set forth in Section 3.13 of this Plan) shall receive from the
Disbursing Agent, in full satisfaction, settlement, release, extinguishment,
cancellation and discharge of such Interest, for each share of Old Common Stock
held by such Holder, the sum of $0.1197 (11.97 cents) per share (based on
23,807,347 shares outstanding) payable such that the Holders of Class 7 Common
Interests shall have received in the aggregate $2,850,000; provided, however,
that the Cash distributions to be received by such Holders shall be reduced by
the aggregate amount of Allowed Professional Claims of Professionals retained by
or on behalf of the Equity Committee up to $350,000, such that, at a minimum,
such Holders shall have received in the aggregate $2,500,000 (resulting in a
Cash distribution of $0.105 (10.5 cents) per share of Old Common Stock (based on
23,807,347 shares outstanding)). If Class 7 does not accept this Plan pursuant
to ss.1129(a)(8) of the Bankruptcy Code then they will be entitled to
$2,500,000, pro rata, including Saratoga, payable in quarterly installments of
25% of the amount payable to such Holder starting, with respect to each Holder
of a Class 7 Interest, on the later of (i) the first Calendar-Quarter-End Date
after the Effective Date and (ii) the Calendar-Quarter-End Date next following
the date on which each such Old Common Stock Interest shall have become Allowed,
and on each of the next succeeding Calendar-Quarter-End Date thereafter, until
such Allowed Old Common Stock Interest is paid in full the amount provided for
in this Section 3.12, subject to the proviso that on the 364th day after the
Effective Date of this Plan, each such Holder shall receive the entire
then-unpaid balance of the amount due under this Plan in respect of such Class 7
Interest, without interest. Regardless of the foregoing, Holders of Old Common
Stock Interests that remain Disputed on such 364th day shall be entitled to
receive 100% of the amount due on

                                       24


their Allowed Interest on the date of Allowance thereof. All payments to Holders
of Class 7 Old Common Stock Interests shall be made in Cash unless otherwise
agreed between Reorganized ADLT and the Holder of such Interest. No interest
will accrue or be payable on Class 7 Old Common Stock Interests or the payments
made to Holders thereof.

     Section 3.13. Class 8 Interests: Old Other Interests. Class 8 Interests are
Impaired. Each Holder of an Old Other Interest shall have the right to exercise
its options, warrants, conversion privileges or other legal or contractual
rights to obtain Old Common Stock representing such Interest, which shall become
fully vested as of the date of exercise of such right notwithstanding any
provision to the contrary in the contract or instrument giving rise to such
Interest. To exercise such right, such Holder shall (i) mark or check off the
applicable box on the Ballot cast by such Holder indicating such Holder's
exercise of such right and (ii) on or before the Effective Date, pay all
required consideration and otherwise satisfy all other applicable conditions in
order to exercise such right. If such Holder timely exercises its right to
obtain such Old Common Stock, such Holder shall be entitled to the treatment
provided to Class 7 set forth in Section 3.12 of this Plan with respect to such
Old Common Stock. If such Holder fails to timely exercise its right to obtain
such Old Common Stock, such Holder's Old Other Interest shall be canceled and
extinguished and such Holder shall not receive or retain any property under this
Plan on account of such Interest.

     Section 3.14. Class 9 Interests: Subsidiary Interests. Class 9 Interests
are Unimpaired. Each Holder of an Interest in Class 9 shall retain such Interest
and its respective share or shares of common stock of the Subsidiary Debtors
representing such Interest, but such Holder shall receive no distribution under
this Plan on account of such Interest; provided, however, that as soon as
practicable after the Effective Date, the Reorganized Debtors shall cause
Microsun, LRI and ADLT Services to be dissolved or merged into one of the other
Debtors.

                                   ARTICLE IV

                 ACCEPTANCE OR REJECTION OF THIS PLAN; CRAMDOWN

     Section 4.01. Acceptance by Impaired Classes of Claims and Interests.

          (a) Acceptance by an Impaired Class of Claims. Pursuant to section
     1126(c) of the Bankruptcy Code, an Impaired Class of Claims shall have
     accepted this Plan if (a) the Holders of at least two-thirds (2/3) in
     amount of the Allowed Claims actually voting in such Class (other than
     Claims held by any Holder designated pursuant to section 1126(e) of the
     Bankruptcy Code) have timely and properly voted to accept this Plan, which,
     in the case of the Class 3 Old Note Claims, shall be determined by dividing
     the principal amount of the Old Notes voted in favor of this Plan by the
     total principal amount of the Old Notes voted, and (b) more than one-half
     (1/2) in number of the Holders of such Allowed Claims actually voting in
     such Class (other than Claims held by any Holder designated pursuant to
     section 1126(e) of the Bankruptcy Code) have timely and properly voted to
     accept this Plan.

                                       25


          (b) Acceptance by an Impaired Class of Interests. Pursuant to section
     1126(d) of the Bankruptcy Code, an Impaired Class of Interests shall have
     accepted this Plan if the Holders of at least two-thirds (2/3) in amount of
     the Allowed Interests actually voting in such Class (other than Interests
     held by any Holder designated pursuant to section 1126(e) of the Bankruptcy
     Code) have timely and properly voted to accept this Plan.

     Section 4.02. Voting Classes. Except as otherwise required by the
Bankruptcy Code or the Bankruptcy Rules or as otherwise provided in this Section
4.02, (i) Holders of Old Note Claims (Class 3), (ii) Holders of ADLT General
Unsecured Claims (Class 4), (iii) Holders of Subsidiary Debtor General Unsecured
Claims (Class 5), (iv) Holders of the Old Preferred Interests (Class 6), (v)
Holders of Old Common Interests (Class 7) and (vi) Holders of Old Other
Interests (Class 8), each shall be entitled to vote separately as a Class to
accept or reject this Plan in accordance with Section 4.01(a) of this Plan.
Holders of Unimpaired Claims under this Plan (Miscellaneous Secured Claims
(Class 1), Classified Priority Claims (Class 2) and Subsidiary Interests (Class
9)) shall not be entitled to vote to accept or reject this Plan, and shall be
conclusively presumed to have accepted this Plan pursuant to section 1126(f) of
the Bankruptcy Code, and the votes of Holders in such Classes shall not be
solicited. If a Holder of a Class 8 Old Other Interest exercises its right to
obtain Old Common Stock on account of its Old Other Interest as provided in
Section 3.13 of this Plan, such Holder shall be entitled to the treatment
provided to Class 7 in Section 3.12 of this Plan with respect to such Old Common
Stock. If such Holder fails to timely exercise its right to obtain Old Common
Stock, such Holder's Old Other Interest shall be canceled and extinguished and
such Holder shall not receive or retain any property under this Plan on account
of such Interest; in such event, pursuant to section 1126(g) of the Bankruptcy
Code, such Holder shall be conclusively presumed to have rejected this Plan in
respect of such Interest (even if such Holder cast a Ballot accepting this Plan)
because this Plan does not entitle the Holders of such Interests to receive or
retain any property under this Plan on account of such Interests. Administrative
Claims, Priority Tax Claims and the DIP Facility Claim are Unimpaired and not
classified under this Plan and hence are not entitled to vote to accept or
reject this Plan.

     Section 4.03. Ballot Instructions. Each Holder of Old Notes or Old Common
Stock is required to complete and return a Ballot to the holder of record
thereof (in the case of the Old Notes, the Old Indenture Trustee) who shall then
compute and deliver to the Voting Agent a Master Ballot compiling the votes so
received.

     All questions as to the validity, form, and eligibility (including time of
receipt) of Ballots or Master Ballots shall be resolved by the Debtors and
Saratoga whose determination shall be final and binding, subject only to review
by the Bankruptcy Court upon application with due notice to any affected parties
in interest. The Debtors reserve the right to reject any and all Ballots and
Master Ballots not in proper form.

     Section 4.04. Cramdown. If all applicable requirements for Confirmation of
this Plan are met as set forth in section 1129(a)(1) through (13) of the
Bankruptcy Code except subsection (8) thereof, the Debtors reserve the right to
request that the Bankruptcy Court confirm this Plan in accordance with section
1129(b) of the Bankruptcy Code, notwithstanding the requirements of section
1129(a)(8) thereof, on the basis that this Plan is fair and equitable, and does
not discriminate unfairly, with respect to each Class of Claims or Interests
that is Impaired under,

                                       26


and has not accepted, this Plan. No re-solicitation of votes for the Plan as so
modified shall be required.

     Section 4.05. Confirmation of All Cases. This Plan shall not be deemed to
have been confirmed as to any Debtor unless and until this Plan has been
confirmed in each of the Debtors' Chapter 11 Cases.

                                   ARTICLE V

               PROVISIONS GOVERNING DISTRIBUTIONS UNDER THIS PLAN

     Section 5.01. Timing of Distributions. Except as set forth in Section 5.03
below, an initial distribution of Property shall be made to Holders of Allowed
Claims and Allowed Interests in accordance with Article III of this Plan.
Subsequent distributions may be made from time to time in the reasonable
discretion of the Disbursing Agent except as otherwise required under this Plan.
If a Claim or Interest is not an Allowed Claim or an Allowed Interest as of the
applicable distribution date, distributions shall be made only if and when the
Claim or Interest is Allowed and in accordance with Article III of this Plan
and, with respect to the cure of defaults for assumed executory contracts and
unexpired leases, Section 6.02 of this Plan, and in each case, subject to
Article VI of this Plan.

     Section 5.02. Distribution Record Date. As of the close of business on the
Distribution Record Date, all transfer ledgers, transfer books, registers and
any other records maintained by the designated transfer agents with respect to
ownership of the Old Notes, the Old Preferred Stock or the Old Common Stock will
be closed and, for purposes of this Plan, there shall be no further changes in
the record holders of the Old Notes, Old Preferred Stock or the Old Common
Stock. The Disbursing Agent shall have no obligation to recognize the transfer
of any Old Notes, Old Preferred Stock or Old Common Stock occurring after the
Distribution Record Date, and will be entitled for all purposes to recognize and
deal only with those Holders of the Old Notes, Old Preferred Stock or the Old
Common Stock as of the close of business on the Distribution Record Date, as
reflected on such ledgers, books, registers or records.

     Section 5.03. Distributions to Holders of Allowed Claims. Except as
otherwise provided in this Plan, on the Effective Date, the Reorganized Debtors
shall deliver to the Disbursing Agent sufficient Cash to make the distributions
to be made on the Effective Date to the Holders of Allowed Claims. Subsequent
distributions will be made by the Reorganized Debtors or the Disbursing Agent,
as the Reorganized Debtors may determine at the time. Payments and other
distributions to be made pursuant to this Plan will be available from the
proceeds of the New Credit Facility and other funds held by the Reorganized
Debtors as of the Effective Date. If any dispute arises as to the identity of a
Holder of an Allowed Claim who is to receive any distribution, the Reorganized
Debtors shall, in lieu of making such distribution to such Holder, delay such
distribution until the disposition thereof shall be determined by Final Order of
the Bankruptcy Court or by written agreement among the interested parties to
such dispute.

     Section 5.04. Class 3, Class 6 and Class 7 Distributions. Distributions to
Classes 3, 6 and 7 shall be made by the Disbursing Agent as set forth in this
Section 5.04. The Disbursing

                                       27


Agent may establish reasonable and customary rules and procedures in connection
with its duties. Additionally, the Disbursing Agent may, in its discretion,
waive or modify any term or provision of this Section 5.04 if the Disbursing
Agent reasonably determines that application of such term or provision to any
Holder in Class 3, Class 6 or Class 7 would be impracticable.

          (a) Class 3. Promptly after the Effective Date, the Disbursing Agent
     shall mail to the Holders of Allowed Class 3 Old Note Claims (or, in lieu
     thereof, to the Old Indenture Trustee, who in turn shall mail or otherwise
     distribute to Holders of Allowed Class 3 Old Note Claims) appropriate
     transmittal materials (which shall specify that delivery of Old Notes shall
     be effected, and risk of loss and title to the Old Notes theretofore
     evidencing the Allowed Class 3 Claims, shall pass, only upon proper
     delivery of such Old Notes to the Disbursing Agent). In order to receive a
     distribution of New Notes the Holder thereof must surrender the Old Notes
     representing such Allowed Class 3 Claim in accordance with Section 5.05
     below and the Disbursing Agent shall not be obligated to deliver New Notes
     until such Holder surrenders such Holder's Old Notes as provided therein.
     Promptly upon surrender of such Old Notes, such Holder shall receive in
     exchange therefor the distribution of New Notes to which such Holder is
     entitled under Section 3.08 hereof; provided, however, that if there is any
     dispute as to the identity of a Holder of an Allowed Class 3 Claim, the
     Disbursing Agent shall, in lieu of making such distribution to such Holder,
     delay such distribution until the disposition thereof shall be determined
     by Final Order of the Bankruptcy Court or by written agreement among the
     interested parties to such dispute. Notwithstanding the date of actual
     distribution, all New Notes to be distributed on account of Allowed Class 3
     Claims shall be deemed to have been issued and be outstanding on the
     Effective Date.

          (b) Class 6. Promptly after the Effective Date, the Disbursing Agent
     shall deliver to the Holder of the Allowed Class 6 Preferred Interests
     (currently Saratoga) appropriate transmittal materials (which shall specify
     that delivery shall be effected, and risk of loss and title to the
     Certificates theretofore representing shares of Old Preferred Stock shall
     pass, only upon proper delivery of such Certificates to the Disbursing
     Agent). In order to receive a distribution of New Common and Preferred
     Stock, the Holder thereof must surrender the Certificate(s) representing
     such Allowed Class 6 Preferred Interests in accordance with Section 5.05
     below and the Disbursing Agent shall not be obligated to deliver New Common
     and Preferred Stock until each such Holder surrenders such Holder's
     Certificate(s) as provided therein. Promptly upon surrender of such
     Certificate(s), such Holder shall receive in exchange therefor the
     distribution of New Common and Preferred Stock to which such Holder is
     entitled under Section 3.11 hereof. Saratoga is the only Holder of a Class
     6 Preferred Interest, and there is no dispute that Saratoga's Interests in
     761,250 shares of Old Preferred Share Interests has been Allowed.
     Notwithstanding the date of actual distribution, all New Common and
     Preferred Stock to be distributed on account of Allowed Class 6 Preferred
     Interests shall be deemed to have been issued and outstanding on the
     Effective Date.

          (c) Class 7. Promptly after the Effective Date, the Disbursing Agent
     shall mail to the Holders of Allowed Class 7 Common Interests (or, in lieu
     thereof, to any depository bank, brokerage firm or other nominee, or agent
     or proxy holder thereof holding Old Common Stock in its own name on behalf
     of such Holders, who in turn shall

                                       28


     mail to the applicable Holders of Allowed Class 7 Common Interests)
     appropriate transmittal materials (which shall specify that delivery shall
     be effected, and risk of loss and title to the Certificates theretofore
     representing shares of Old Common Stock shall pass, only upon proper
     delivery of such Certificates to the Disbursing Agent). In order to receive
     a Cash distribution, the Holder thereof must surrender the Certificate(s)
     representing such Allowed Class 7 Common Interests in accordance with
     Section 5.05 below and the Disbursing Agent shall not be obligated to
     deliver such Cash distribution until such Holder surrenders such Holder's
     Certificate(s) as provided therein. Promptly upon surrender of such
     Certificate(s), such Holder shall receive in exchange therefor the Cash
     distribution to which such Holder is entitled under Section 3.12 hereof;
     provided, however, that if there is any dispute as to the identity of a
     Holder of Allowed Class 7 Common Interests, the Disbursing Agent shall, in
     lieu of making such distribution to such Holder, delay such distribution
     until the disposition thereof shall be determined by Final Order of the
     Bankruptcy Court or by written agreement among the interested parties to
     such dispute.

     Section 5.05. Surrender and Forfeiture of Rights. As a condition to
receiving a distribution of New Common and Preferred Stock and, in the case of
the Allowed Class 6 Preferred Interests, or, in the case of Allowed Class 7
Common Interests, a Cash distribution, under this Plan, after the Effective
Date, each Holder of an Allowed Class 3 Old Note Claim, Allowed Class 6
Preferred Interest or Allowed Class 7 Common Interest must surrender the
Certificate(s) representing such Allowed Class 3 Claim, Allowed Class 6 Interest
or Allowed Class 7 Interest, as the case may be, to the Disbursing Agent for
cancellation. Any Holder of an Allowed Class 3 Claim, Allowed Class 6 Interest
or Allowed Class 7 Interest that fails to (i) surrender its Certificate(s) or
(ii) execute and deliver an affidavit of loss and/or provide indemnity
reasonably satisfactory to Reorganized ADLT and, in the case of the Old Notes,
the Old Indenture Trustee before the later to occur of (y) the first anniversary
of the Effective Date and (z) six (6) months following the date such Holder's
Class 3 Claim, Class 6 Interest or Class 7 Interest becomes an Allowed Claim or
Interest, as applicable, shall be deemed to have forfeited all of its rights,
Claims and/or Interests and may not participate in any distribution under this
Plan.

     Section 5.06. Delivery of Distributions. Distributions to Holders of
Allowed Claims or Interests shall be made by the Disbursing Agent (A) at the
last known addresses of such Holders, (B) at the addresses set forth in any
written notices of address changes delivered to the Disbursing Agent, (C) in the
case of Holders of Allowed Class 3 Old Note Claims, at the addresses contained
in the official records of the Old Indenture Trustee or (D) at the addresses set
forth in any properly completed letters of transmittal accompanying Certificates
properly remitted to the Disbursing Agent. If any Holder's distribution is
returned as undeliverable, no further distributions to such Holder shall be made
unless and until the Disbursing Agent is notified of such Holder's then current
address, at which time all missed distributions shall be made to such Holder
without interest. All distributions pursuant to this Plan shall be at the
Reorganized Debtors' expense.

     Section 5.07. Method of Cash Distributions. Any Cash payment to be made
pursuant to this Plan may be made by Cash, draft, check, wire transfer, or as
otherwise required or provided in any relevant agreement or applicable law at
the option of the Reorganized Debtors.

                                       29


     Section 5.08. Failure to Present Checks. Checks issued in respect of
distributions under this Plan shall be null and void if not presented to the
drawee bank within sixty (60) days after the date of issuance. Any amounts
returned to the Reorganized Debtors in respect of such non-presented checks
shall be held by the Reorganized Debtors, as appropriate. Requests for
reissuance for any such check shall be made directly to the Reorganized Debtors
by the Holder of the Allowed Claim with respect to which such check originally
was issued. All amounts represented by any check voided under this Section 5.08
will be held until the later of one (1) year after (A) the Effective Date or (B)
the date that a particular Claim is Allowed, and all requests for reissuance by
the Holder of the Allowed Claim in respect of a check voided under this Section
5.08 are required to be made prior to such date. Thereafter, all such amounts
shall be deemed to be Unclaimed Property, in accordance with Section 5.09 of
this Plan, and all Claims in respect of void checks and the underlying
distributions shall be forever barred, estopped and enjoined from assertion in
any manner against the Debtors or their respective Properties, or the
Reorganized Debtors or their respective Properties.

     Section 5.09. Unclaimed Distributions. All Property distributed on account
of Claims must be claimed within the later of (A) one (1) year after the
Effective Date or (B) one (1) year after such distribution is made to such
Holder or, in the case of a distribution made in the form of a check, must be
presented to the drawee bank and a request for reissuance be made as provided
for in Section 5.08 of this Plan. All Unclaimed Property shall be retained by
and shall revest in the Reorganized Debtors and shall no longer be subject to
distribution. All full or partial payments made by the Debtors or the Disbursing
Agent (as the case may be) and received by the Holder of a Claim or Interest
prior to the Effective Date shall be deemed to be payments under this Plan for
purposes of satisfying the obligations of the Debtors pursuant to this Plan.
Nothing contained in this Plan shall require the Reorganized Debtors to attempt
to locate any Holder of an Allowed Claim or Allowed Interest other than by
reviewing the records of the Reorganized Debtors. Pursuant to section 1143 of
the Bankruptcy Code, all Claims in respect of Unclaimed Property shall be deemed
Disallowed and the Holder of any Claim Disallowed in accordance with this
Section 5.09 shall be forever barred, expunged, estopped and enjoined from
assertion in any manner against the Debtors or their respective Properties, or
the Reorganized Debtors or their respective Properties.

     Section 5.10. Limitation on Distribution Rights. If a claimant holds more
than one Claim in any one Class, all Claims of the claimant in that Class shall
be aggregated into one Claim and one distribution shall be made with respect to
the aggregated Claim.

     Section 5.11. Fractional Dollars. Notwithstanding any other provision of
this Plan, Cash distributions of fractions of dollars shall not be made; rather,
whenever any payment of a fraction of a dollar would be called for, the actual
payment made shall reflect a rounding of such fraction to the nearest whole
dollar (up or down), with half dollars being rounded down. To the extent that
Cash remains undistributed as a result of the rounding of such fraction to the
nearest whole cent, such Cash shall be treated as Unclaimed Property pursuant to
Section 5.09 of this Plan.

     Section 5.12. Fractional New Notes. No New Notes shall be issued or
distributed in a denomination less than $1000. Whenever any distribution to a
Holder of an Allowed Old Note Claim would otherwise call for distribution of a
fraction of a New Note based on the minimum

                                       30


$1000 denomination, the actual distribution of New Notes to such Holder shall be
rounded to the next higher or lower $1000 denominational increment, with
five-hundred dollar ($500) fractions being rounded down. The total number of New
Notes to be distributed shall be adjusted as necessary to account for the
rounding provided for in this Section 5.12. No consideration shall be provided
in lieu of fractional New Notes that are rounded down.

     Section 5.13. Compliance With Tax Requirements. In connection with each
distribution with respect to which the filing of an information return (such as
an Internal Revenue Service Form 1099 or 1042) or withholding is required, the
Reorganized Debtors shall file such information return with the Internal Revenue
Service and provide any required statements in connection therewith to the
recipients of such distribution or effect any such withholding and deposit all
moneys so withheld as required by law. With respect to any Person from whom a
tax identification number, certified tax identification number or other tax
information required by law to avoid withholding has not been received by the
Reorganized Debtors within thirty (30) days from the date of such request, the
Reorganized Debtors may, at their option, withhold the amount required and
distribute the balance to such Person or decline to make such distribution until
the information is received.

     Section 5.14. De Minimis Distributions. No Cash payment of less than five
($5.00) dollars shall be made to any Holder of a Claim on account of its Allowed
Claim.

     Section 5.15. Documentation Necessary to Release Liens. Each Creditor which
is to receive a distribution under this Plan in full satisfaction of a Secured
Claim shall not receive such distribution until such Creditor executes and
delivers any documents necessary to release all Liens arising under any
applicable security agreement or non-bankruptcy law (in recordable form if
appropriate) in connection with such Secured Claim and such other documents as
the Debtors or the Reorganized Debtors, as the case may be, may reasonably
request or otherwise turns over and releases any and all property of the Debtors
that secures or purportedly secures such Claim. Any such holder that fails to
execute and deliver such release of liens within 120 days of the Effective Date
shall be deemed to have no further Claim against the Debtors, the Reorganized
Debtors or their respective assets or Properties in respect of such Claim and
shall not participate in any distribution hereunder on account of such Claim.
Notwithstanding the immediately preceding sentence, any such Holder of a
Disputed Claim shall not be required to execute and deliver such release until
such time as the Claim is Allowed or Disallowed.

                                   ARTICLE VI

                    EXECUTORY CONTRACTS AND UNEXPIRED LEASES;
                      INDEMNIFICATION OBLIGATIONS; BENEFIT
                                    PROGRAMS

     Section 6.01. Treatment of Executory Contracts and Unexpired Leases. On the
Effective Date, all executory contracts and unexpired leases that exist between
the Debtors and any Person which (A) have not expired or terminated pursuant to
their own terms, (B) have not previously been assumed, or assumed and assigned
or rejected pursuant to an order of the Bankruptcy Court on or prior to the
Confirmation Date, (C) are not the subject of pending motions to assume, or
assume and assign or reject as of the Confirmation Date, or (D) are not

                                       31


listed on the Schedule of Rejected Contracts, shall be deemed assumed in
accordance with the provisions and requirements of section 365 of the Bankruptcy
Code; provided, however, that (a) that certain Lamp Materials Purchase Agreement
entered into by and between APL and GE, as of September 30, 1999, as amended by
letter agreement dated October 4, 1999, and that certain Patent and Technical
Assistance Agreement entered into by and among APL, ADLT and GE, as of September
30, 1999 (collectively, the "GE Contracts") are deemed assumed under this
Section 6.01, notwithstanding any other provisions of this Section 6.01, and GE
waives any and all defaults, claims for such defaults and rights to assert the
need for adequate assurance of future performance under 11 U.S.C. ss.
365(b)(10(A), (B) and (C). The Debtors shall have the right, subject to the
consent of the Creditors Committee and GE, at any time prior to the Confirmation
Date, to amend the Schedule of Rejected Contracts upon notice to the
counterparty to such contract or lease (i) to delete any executory contract or
unexpired lease listed therein, thus providing for its assumption pursuant to
this Section 6.01 or (ii) to add any executory contract or unexpired lease
thereto, thus providing for its rejection pursuant to this Section 6.01. The
Confirmation Order (except as otherwise provided therein) shall constitute an
order of the Bankruptcy Court pursuant to section 365 of the Bankruptcy Code,
effective as of the Effective Date, approving such assumptions, including,
without limitation, the assumption of the GE Contracts. Each contract and lease
assumed pursuant to this Section 6.01 shall be assumed only to the extent that
any such contract or lease constitutes an executory contract or unexpired lease.
Assumption of a contract or lease pursuant to this Section 6.01 shall not
constitute an admission by the Debtors or the Reorganized Debtors that such
contract or lease is an executory contract or unexpired lease or that the
Debtors or the Reorganized Debtors have any liability thereunder. All executory
contracts and unexpired leases that are assumed shall be assumed under their
present terms or upon such terms as are agreed to between the Debtors and the
other party to the executory contract or unexpired lease. Each executory
contract and unexpired lease that is assumed and relates to the use, ability to
acquire, or occupancy of real property shall include: (y) all modifications,
amendments, supplements, restatements, or other agreements made directly or
indirectly by any agreement, instrument, or other document that in any manner
affect such executory contract or unexpired lease and (z) all executory
contracts or unexpired leases appurtenant to the premises, including all
easements, licenses, permits, rights, privileges, immunities, options, rights of
first refusal, powers, uses, reciprocal easement agreements, vaults, tunnel or
bridge agreements or franchises, and any other interests in real estate or
rights in rein related to such premises, unless any of the foregoing agreements
has been rejected pursuant to an order of the Bankruptcy Court.

     Section 6.02. Cure of Defaults for Assumed Contracts and Leases. All
undisputed cure and any other monetary default payments required by section
365(b)(1) of the Bankruptcy Code under which any executory contract and
unexpired lease to be assumed pursuant to this Plan is in default shall be
satisfied by the Reorganized Debtors (to the extent such obligations are
enforceable under the Bankruptcy Code and applicable non-bankruptcy law),
pursuant to section 365(b)(1) of the Bankruptcy Code, at the option of the
Reorganized Debtors: (A) by payment of such undisputed cure amount, without
interest, in Cash within sixty (60) days following the Effective Date; (B) such
other amount as ordered by the Bankruptcy Court; or (C) on such other terms as
may be agreed to by the parties to such executory contract or unexpired lease.
In the event of a dispute pursuant to Section 6.03 of this Plan, payment of the
amount otherwise payable hereunder shall be made without interest, in Cash (i)
on or before the later of sixty (60) days following the Effective Date or thirty
(30) days following entry of a Final Order liquidating

                                       32


and allowing any disputed amount or (ii) on such other terms as may be agreed to
by the parties to such executory contract or unexpired lease.

     Section 6.03. Resolution of Objections to Assumption of Executory Contracts
and Unexpired Leases; Cure Payments.

          (a) Resolution of Objections to Assumption of Executory Contracts and
     Unexpired Leases. Any party objecting to the Debtors' proposed assumption
     of an executory contract or unexpired lease or the ability of the
     Reorganized Debtors to provide "adequate assurance of future performance"
     (within the meaning of section 365 of the Bankruptcy Code) under the
     contract or lease to be assumed shall File and serve on counsel for the
     Debtors a written Objection to the assumption of such contract or lease
     within thirty (30) days after the service of the notice of entry of the
     Confirmation Order. Failure to File an Objection within the time period set
     forth above shall constitute the assumption and revestment of such contract
     or lease, including an acknowledgment that the proposed assumption provided
     adequate assurance of future performance. To the extent that any Objections
     to the assumption of a contract or lease are timely Filed and served and
     such Objections are not resolved between the Debtors and the objecting
     parties, the Bankruptcy Court shall resolve such disputes at a hearing to
     be held on a date to be determined by the Bankruptcy Court.

          (b) Resolution of Cure Payments. If the counterparty to any assumed
     executory contract or unexpired lease believes that, as of the Confirmation
     Date, a cure payment is due and owing under such contract or lease, such
     counterparty shall File and serve on counsel for the Debtors a notification
     setting forth the amount of the cure payment which such party believes is
     due and owing, which notification shall be Filed and served no later than
     thirty (30) days after the service of the earlier of (A) notice of entry of
     the Confirmation Order or (B) other notice that the executory contract or
     unexpired lease has been assumed pursuant to any other Final Order of the
     Bankruptcy Court. Failure to File such a notification within the time
     period set forth above shall constitute an acknowledgment that no cure
     payment is due and owing in connection with the assumption of such contract
     or lease and an acknowledgment that no other defaults exist under said
     contract or lease. To the extent that any such notifications are timely
     Filed and served and are not resolved between the Debtors and the
     applicable counterparty, the Bankruptcy Court shall resolve such disputes
     at a hearing to be held on a date to be determined by the Bankruptcy Court.
     The resolution of such disputes shall not affect the Debtors' assumption of
     the contracts or leases that are subject of such a dispute, but rather
     shall affect only the "cure" amount the Debtors must pay in order to assume
     such contract or lease. Notwithstanding the immediately preceding sentence,
     if the Debtors in their discretion determine that the amount asserted to be
     the necessary "cure" amount would, if ordered by the Bankruptcy Court, make
     the assumption of the contract or lease imprudent, then the Debtors may
     elect to (i) reject the contract or lease pursuant to Section 6.01 hereof
     or (ii) request an expedited hearing on the resolution of the "cure"
     dispute, exclude assumption or rejection of the contract or lease from the
     scope of the Confirmation Order, and retain the right to reject the
     contract or lease pursuant to Section 6.01 hereof pending the outcome of
     such dispute.

                                       33


     Section 6.04. Claims for Rejection Damages. Objections to the amounts
listed on the Schedule of Rejected Contracts for damages allegedly arising from
the rejection pursuant to this Plan or the Confirmation Order of any executory
contract or any unexpired lease shall be Filed with the Bankruptcy Court and
served on counsel for the Debtors not later than thirty (30) days after the
service of the earlier of (A) notice of entry of the Confirmation Order or (B)
other notice that the executory contract or unexpired lease has been rejected
pursuant to any other Final Order of the Bankruptcy Court. Any Holder of a Claim
arising from the rejection of any executory contract or any unexpired lease that
fails to File such Objection on or before the dates specified in this paragraph
shall be forever barred, estopped and enjoined from asserting any Claims in any
manner against the Debtors or their respective Properties, or the Reorganized
Debtors or their respective Properties, for any amounts in excess of the amount
scheduled by the Debtors on the Schedule of Rejected Contracts for such contract
or lease, and the Debtors and the Reorganized Debtors shall be forever
discharged from all indebtedness or liability with respect to such Claims for
such excess amounts and such Holders shall be bound by the terms of this Plan.

     Section 6.05. Treatment of Rejection Claims. The Bankruptcy Court shall
determine any Objections Filed in accordance with Section 6.04 hereof at a
hearing to be held on a date to be determined by the Bankruptcy Court. Subject
to any statutory limitation, including, without limitation, the limitations
contained in sections 502(b)(6) and 502(b)(7) of the Bankruptcy Code, any Claims
arising out of the rejection of executory contracts and unexpired leases shall,
pursuant to section 502(g) of the Bankruptcy Code, (a) be Impaired and treated
as Class 4 ADLT General Unsecured Claims in accordance with Section 3.09 of this
Plan, or (b) be Impaired and treated as Class 5 Subsidiary Debtor General
Unsecured Claims in accordance with Section 3.10 of this Plan, as the case may
be.

     Section 6.06. Executory Contracts and Unexpired Leases Entered Into and
Other Obligations Incurred After the Petition Date. On the Effective Date, all
contracts, leases, and other agreements entered into by the Debtors on or after
the Petition Date, which agreements have not terminated or expired in accordance
with their terms on or before the Confirmation Date, shall revest in and remain
in full force and effect as against the Reorganized Debtors and the other
parties to such contracts, leases and other agreements.

     Section 6.07. Reorganized Debtors' Indemnification Obligations. To the
extent not inconsistent with this Plan, any obligations of the Debtors, pursuant
to their respective articles of incorporation or by-laws, applicable state law
or their specific agreement, to indemnify a Person (including, without
limitation, Professionals retained by or on behalf of the Debtors or their
Estates) with respect to all present and future actions, suits and proceedings
against the Debtors, the Reorganized Debtors or such indemnified Person, based
upon any act or omission related to service with, or for or on behalf of, the
Debtors or the Reorganized Debtors, shall survive Confirmation of this Plan and
shall not be impaired by Confirmation of this Plan, but shall be deemed and
treated as executory contracts that are assumed by the Debtors pursuant to this
Plan and section 365 of the Bankruptcy Code, except to the extent any such
obligation has been released, discharged or modified pursuant to this Plan or
order of the Bankruptcy Court on or before the Confirmation Date. Such
indemnification obligations shall survive unaffected by this Plan and shall be
performed and honored by the Reorganized Debtors.

                                       34


     Section 6.08. Benefit Programs. Except and to the extent previously assumed
by an order of the Bankruptcy Court on or before the Confirmation Date, all
officer, director or employee compensation and benefit programs of the Debtors,
including programs subject to sections 1114 and 1129(a)(13) of the Bankruptcy
Code, entered into before or after the Petition Date and not since terminated,
shall be deemed to be, and shall be treated as though they are, executory
contracts that are assumed under Section 6.01 of this Plan, but only to the
extent that rights under such programs are held by the Debtors or Persons who
are employees of the Debtors as of the Confirmation Date, and the Debtors'
obligations under such programs to Persons who are employees of the Debtors on
the Confirmation Date shall survive Confirmation of this Plan, except for (A)
any officer, director or employee compensation and benefit program that entitled
such Persons to acquire any Old Common Stock or Old Other Interests, (B)
executory, contracts or plans specifically rejected pursuant to this Plan (to
the extent such rejection does not violate sections 1114 and 1129(a)(13) of the
Bankruptcy Code) and (C) executory contracts or plans as have previously been
rejected, are the subject of a motion to reject, or have been specifically
waived by the beneficiaries of any plans or contracts; provided, however, that
the Debtors' obligations, if any, to pay all "retiree benefits" as defined in
section 1114(a) of the Bankruptcy Code shall continue; provided further,
however, that nothing herein shall extend or otherwise modify the duration of
such period or prohibit the ability of the Debtors or the Reorganized Debtors to
modify the terms and conditions of the retiree benefits as otherwise permitted
by such plans and applicable non-bankruptcy law. Unless otherwise provided in
this Plan, any entitlement to acquire Old Common Stock or Old Other Interests
held as of the Effective Date by any officer, director or employee of the
Debtors, whether automatic or contained in a compensation and benefit program or
other contract or agreement, shall receive the treatment provided in Section
3.13 of this Plan relating to Class 8 Old Other Interests.

                                  ARTICLE VII

                      MEANS FOR IMPLEMENTATION OF THIS PLAN

     Section 7.01. Corporate Action. The entry of the Confirmation Order shall
constitute authorization for the Debtors and the Reorganized Debtors to take or
cause to be taken all corporate actions necessary or appropriate to consummate
and implement the provisions of this Plan prior to, on and after the Effective
Date, including all actions taken in connection with the reincorporation of ADLT
as a Delaware corporation, and all such actions taken or caused to be taken
shall be deemed to have been authorized and approved by the Bankruptcy Court,
including, without limitation, (a) the adoption of the New ADLT Certificate of
Incorporation and the New ADLT By-Laws; (b) the cancellation of the Old Notes,
the Old Preferred Stock and the Old Common Stock; (c) the issuance of the New
Notes, the New Common Stock and the New Preferred Stock; (d) the execution of
the Saratoga Management Services Agreement; (e) the execution of all documents
relating to the New Credit Facility, including documents granting liens and
security interests in certain of the Debtors' assets to the lenders thereunder;
(f) the incumbency of directors and officers in accordance with Section 10.02 of
this Plan; (i) the execution of the Senior Management Contracts; (g) the
adoption of the Management Incentive Plan; and (h) the issuance of the
Management Options. Reincorporation of ADLT will occur by ADLT being merged into
a newly-created Delaware corporation (Advanced Lighting Technologies (Delaware),
Inc.) pursuant to a tax-free merger under an appropriate merger agreement. All
such actions shall be deemed to have occurred and shall be in effect pursuant to

                                       35


applicable non-bankruptcy law and the Bankruptcy Code, without any requirement
of further action by the partners, stockholders or directors of the Debtors or
the Reorganized Debtors. On the Effective Date, the appropriate officers,
partners and directors of the Debtors and the Reorganized Debtors are authorized
and directed to execute and deliver this Plan Documents, and all other
agreements, documents and instruments contemplated by this Plan in the name and
on behalf of the Debtors and the Reorganized Debtors.

     Section 7.02. New Certificate of Incorporation and By-Laws. The New ADLT
Certificate of Incorporation shall satisfy the provisions of this Plan and the
Bankruptcy Code and shall include or provide for, without limitation, (a)
reincorporation of ADLT as a Delaware corporation, (b) authorization to issue
the New Notes, the New Common Stock and the New Preferred Stock; and (c) a
prohibition on the issuance of nonvoting equity securities to the extent, and
only to the extent, required by section 1123(a)(6) of the Bankruptcy Code.

     Section 7.03. Issuance of New Notes. On the Effective Date, the Old Notes
shall be canceled and exchanged for the New Notes in accordance with Section
3.08 of this Plan. This exchange of the Old Notes for the New Notes shall be in
full satisfaction, settlement, release and discharge of all Allowed Class 3 Old
Note Claims. The Old Notes shall be cancelled and the New Notes shall be
credited to the accounts maintained on behalf of the Holders thereof at the
applicable record holder.

     Section 7.04. Issuance of New Stock. On the Effective Date: (a) the Old
Preferred Stock shall be, upon payment by Saratoga of $18,000,000 in Cash,
exchanged for _____ shares of New Preferred Stock and _____ shares of New Common
Stock; (b) Allowed Class 3 Old Note Claims shall be exchanged for New Notes; and
(c) Allowed Class 7 Common Interests shall be converted into the right to
receive Cash distributions, in accordance with Sections 3.12, 3.08 and 3.13 of
this Plan, respectively. This exchange of the Old Notes, the Old Preferred Stock
and the Old Common Stock shall be in full satisfaction, settlement, release and
discharge of such Allowed Claims and Interests. The Old Notes, the Old Preferred
Stock and the Old Common Stock shall be cancelled and the shares of New Common
Stock, the New Notes and the New Preferred Stock and the rights to receive Cash
distributions, respectively, shall be credited to the accounts maintained on
behalf of the Holders thereof at the applicable record holder.

     Section 7.05. New Credit Facility. On or prior to the Effective Date, ADLT
shall enter into the New Credit Facility.

     Section 7.06. Cancellation of Existing Securities. On the Effective Date,
the Old Notes, the Old Preferred Stock, the Old Common Stock (including any
shares of Old Common Stock that have been authorized to be issued but that have
not been issued as of the Effective Date) and the Old Other Interests shall be
canceled and extinguished and the Holders thereof shall have no rights and such
instruments shall evidence no rights, except the right to receive the
distributions, if any, to be made to Holders of such instruments under this
Plan. Except with respect to the performance by the Old Indenture Trustee or its
agents of the Old Indenture Trustee's obligations under this Plan or in
connection with any distribution to be made under this Plan, effective as of the
Effective Date, the Old Indenture Trustee and its agents, successors and assigns
shall be discharged of all of their obligations associated with the Old
Indenture and related agreements and released from all Claims arising in these
Chapter 11 Cases and, effective as of the Effective

                                       36


Date, such Old Indenture shall be deemed canceled, except that such cancellation
shall not impair the rights of the Holders of the Old Notes to receive
distributions under this Plan or the rights of the Old Indenture Trustee under
its charging lien pursuant to the Old Indenture to the extent that the Old
Indenture Trustee has not received payment on account of the Old Indenture
Trustee Claim pursuant to Section 7.07 of this Plan.

     Section 7.07. Rights of Old Indenture Trustee Under Old Indenture. The Old
Indenture Trustee shall be entitled to an Administrative Claim as provided for
in, and subject to the restrictions of, this Section 7.07 of this Plan, and no
Reorganized Debtor shall have any obligations to any indenture trustee,
including the Old Indenture Trustee, agent or servicer (or to any Disbursing
Agent replacing such indenture trustee, agent or servicer) under the Old
Indenture for any fees, costs or expenses except as expressly set forth in this
Section 7.07 of this Plan. No later than five (5) Business Days prior to the
Effective Date, the Old Indenture Trustee shall provide the Debtors with a
statement of the Old Indenture Trustee Claim projected through the Effective
Date. Upon the timely receipt of one or more invoices in accordance with the
preceding sentence, the Reorganized Debtors shall, on the Effective Date, pay in
Cash (i) the reasonable fees and expenses of the Old Indenture Trustee under the
Old Indenture and (ii) the reasonable legal fees and expenses of the Old
Indenture Trustee incurred in connection with the Chapter 11 Cases
(collectively, the "Old Indenture Trustee Claim"). Notwithstanding the
foregoing, to the extent that the Reorganized Debtors dispute any portion of the
Old Indenture Trustee Claim, the Reorganized Debtors shall reserve Cash on the
Effective Date in such Disputed amount and such dispute shall be presented to
the Bankruptcy Court for adjudication as to whether such Disputed amount is
reasonable and payable under the terms of the Old Indenture. On the Effective
Date, subject to the payment of the non-Disputed portion of the Old Indenture
Trustee Claim, all liens of the Old Indenture Trustee in any distributions to
Holders of Allowed Class 3 Claims shall be released and discharged to the extent
paid herein. Once the Old Indenture Trustee has completed performance of all of
its duties set forth in this Plan or in connection with any distributions to be
made under this Plan, if any, the Old Indenture Trustee, and its successors and
assigns, shall be relieved of all obligations as Old Indenture Trustee effective
as of the Effective Date.

     Section 7.08. Operations Between the Confirmation Date and the Effective
Date. Except as permitted by Section 7.09, the Debtors shall continue to operate
as debtors-in-possession, subject to the supervision of the Bankruptcy Court,
during the period from the Confirmation Date through and until the Effective
Date.

     Section 7.09. Revesting of Assets. Except as otherwise expressly provided
in this Plan, pursuant to sections 1123(a)(5), 1123(b)(3) and 1141(b) of the
Bankruptcy Code, all Property comprising the Estates of each of the Debtors,
including, without limitation, all Causes of Action shall automatically be
retained and revest in the relevant Reorganized Debtor or its respective
successor, free and clear of all Claims, Liens, contractually-imposed
restrictions, charges, encumbrances and Interests of Creditors and equity
security holders on the Effective Date with all such Claims, Liens,
contractually-imposed restrictions, charges, encumbrances and Interests, being
extinguished except as otherwise provided in this Plan or in connection with the
New Credit Facility. As of the Effective Date, each Reorganized Debtor may
operate its respective businesses and use, acquire and dispose of Property and
settle and compromise Claims or Interests without supervision of the Bankruptcy
Court free of any restrictions of the Bankruptcy

                                       37


Code or Bankruptcy Rules, other than those restrictions expressly imposed by
this Plan and Confirmation Order. Without limiting the foregoing, each
Reorganized Debtor may pay the charges it incurs for professional fees,
disbursements, expenses, or related support services incurred after the
Effective Date without any application to the Bankruptcy Court.

     Section 7.10. Registration and Non-Listing of Securities, Periodic
Reporting. On the Effective Date, Reorganized ADLT will deregister as a
registered issuer of equity securities under ss.12(g) of the Exchange Act and
will not list the New Common Stock in any public market. Periodic reporting to
the Commission will be governed by the Indenture for the New Notes and related
regulations.

     Section 7.11. Approval of Agreements. The solicitation of votes on this
Plan shall be deemed a solicitation of the Holders of New Notes, New Common
Stock and Old Preferred Stock for the approval of all agreements and
transactions contemplated by this Plan, including, without limitation, the New
ADLT Certificate of Incorporation, the New ADLT By-Laws, the New Credit
Facility, the Senior Management Contracts and the Management Incentive Plan.
Entry of the Confirmation Order shall constitute approval of such agreements and
transactions as the Confirmation Order shall so provide.

     Section 7.12. [Intentionally left blank.]

     Section 7.13. Adoption of Senior Management Contracts. On the Effective
Date, the Reorganized Company shall enter into the Senior Management Contracts
and all previous employee contracts with members of Senior Management shall be
deemed canceled and extinguished and the members of Senior Management party to
such previous contracts shall have no rights thereunder.

     Section 7.14. Adoption of Management Incentive Plan. On the Effective Date,
the Reorganized Company shall adopt the Management Incentive Plan and shall
issue the Management Options in accordance therewith and in the amounts set
forth therein.

     Section 7.15. Adoption of Saratoga Management Services Agreement. On the
Effective Date, the Reorganized Company shall enter into the Saratoga Management
Services Agreement.

     Section 7.16. Treatment of Hellman Loan. Pursuant to section 1123(b)(3)(A)
of the Bankruptcy Code, the Hellman Loan Documents shall be modified to reduce
the amount of the outstanding indebtedness owed by Hellman to ADLT to $______
million ("Designated Amount"), which is the approximate amount of Hellman's
personal net worth as of the Effective Date; as the balance of the Hellman Loan
is uncollectible, it shall, on the Effective Date be settled, compromised,
forgiven and released by ADLT to the extent it exceeds the Designated Amount.
Except for this reduction in the amount of the indebtedness, the Hellman Loan
Documents, including the liens on and security interests in Hellman's personal
assets securing Hellman's obligations under those loan documents, shall remain
in full force and effect. ADLT's forgiveness of the aforementioned portion of
the Hellman Loan is based solely upon ADLT's determination that it is
uncollectible; such forgiveness shall not be construed as compensation to
Hellman for, among other things, services performed by Hellman on behalf of the
Company or to be performed by Hellman on behalf of the Reorganized Company.

                                       38


                                  ARTICLE VIII

                   PRESERVATION OF CAUSES OF ACTION AND RIGHT
                          TO DEFEND AGAINST AND CONTEST
                              CLAIMS AND INTERESTS

     Section 8.01. Preservation of Rights. Except to the extent that any Claim
is Allowed in an amount set forth in this Plan, which Allowed Claims shall not
be subject to objection by the Debtors or the Reorganized Debtors at any time or
for any reason, nothing, including, without limitation, the failure of the
Debtors or the Reorganized Debtors to object to a Claim or Interest for any
reason during the pendency of the Chapter 11 Cases, shall affect, prejudice,
diminish or impair the rights and legal and equitable defenses of the Debtors or
the Reorganized Debtors with respect to any Claim or Interest, including,
without limitation, all rights of the Debtors or the Reorganized Debtors (i) to
contest or defend themselves against such Claims or Interests in any lawful
manner or forum when and if such Claim or Interest is sought to be enforced by
the Holder thereof or (ii) in respect of legal and equitable defenses to setoffs
or recoupments against Claims or Interests, and the distributions provided for
in Article III of this Plan shall at all times be subject to this Section 8.01
of this Plan and to section 502(d) of the Bankruptcy Code.

     Section 8.02. Rights of Action. Except as otherwise provided in this Plan,
all Causes of Action, whether or not scheduled, shall automatically be retained
and preserved and shall revest in the Reorganized Debtors. Pursuant to section
1123(b)(3) of the Bankruptcy Code, the Reorganized Debtors (as representatives
of the Debtors' Estates) shall retain and have the exclusive right to enforce
and prosecute such Causes of Action against any Entity, that arose before the
Effective Date, other than those expressly released or compromised as part of or
pursuant to this Plan.

     Section 8.03. Setoffs. Except to the extent that any Claim is Allowed in an
amount set forth in Article III of this Plan, the Debtors or the Reorganized
Debtors, as the case may be, may, but shall not be required to, set off against
any Claims and the payments or distributions to be made pursuant to this Plan in
respect of such Claims, any and all debts, liabilities and claims of every type
and nature whatsoever which the Estates, the Debtors or the Reorganized Debtors
may have against their Creditors, but except as specifically set forth in the GE
claims offset settlement agreement, neither the failure to do so nor the
allowance of any such Claims, whether pursuant to this Plan or otherwise, shall
constitute a waiver or release by the Debtors of any such claims the Debtors may
have against such Creditors, and all such claims shall be reserved to and
retained by the Reorganized Debtors.

     Section 8.04. Objection Deadline. Objections to Claims or Interests, or
complaints or motions to subordinate or estimate Claims or Interest, shall be
filed with the Bankruptcy Court, and served on the Holders of such Claims or
Interests to which objection is made, no later than one-hundred twenty (120)
days after the Effective Date, unless otherwise ordered by the Bankruptcy Court.

     Section 8.05. No Payment or Distribution Pending Allowance. All references
to Claims and Interests and amounts of Claims and Interests refer to the amount
of the Claim or Interest Allowed by agreement of the Debtors or Reorganized
Debtors and the Holder of such Claim or

                                       39


Interest, by operation of law, by Final Order or by this Plan. Notwithstanding
any other provision in this Plan, no payment or distribution shall be made on
account of or with respect to any Claim or Interest to the extent it is a
Disputed Claim or Disputed Interest unless and until the Disputed Claim or
Disputed Interest becomes an Allowed Claim or an Allowed Interest, as
applicable.

     Section 8.06. Bar Date for Administrative Claims. Administrative Claims
arising, accruing and/or incurred by the Debtors on and after the Petition Date
(other than Professional Claims of Professionals retained in the Chapter 11
Cases) shall be filed with the Bankruptcy Court no later than forty five (45)
days after the Effective Date, unless otherwise ordered by the Bankruptcy Court.
Any such Administrative Claims filed after this bar date shall be automatically
deemed Disallowed in full.

                                   ARTICLE IX

                     CONDITIONS TO CONSUMMATION OF THIS PLAN

     Section 9.01. Confirmation Order. The Confirmation Order shall not be
entered unless and until the form and substance thereof, as well as any
amendments to this Plan, have been approved by the Debtors and Saratoga. The
Confirmation Order shall, inter alia;

          (A) authorize the issuance of the New Notes and the New Common Stock,

          (B) authorize the adoption of the Saratoga Management Services
     Agreement,

          (C) authorize the adoption of the Management Incentive Plan,

          (D) authorize the adoption of the Senior Management Contracts, and

          (E) provide that the provisions of the Confirmation Order are
     non-severable and mutually dependent.

     The Confirmation Order shall contain a finding of fact that the Debtors,
the Reorganized Debtors, the Creditors Committee, GE and each of their
Professionals acted in good faith within the meaning of and with respect to the
actions described in section 1125(e) of the Bankruptcy Code and are therefore
not liable for the violation of any applicable law, rule or regulation governing
such actions.

     It shall be a condition precedent to confirmation that should the rate of
interest borne by the New Notes be a rate determined by the Bankruptcy Court as
provided in the definition of "New Notes," that such rate be less than ____%. If
the Bankruptcy Court finds that such rate should be equal to or greater than
_____%, then the Plan shall not be confirmed.

     Section 9.02. Conditions to Consummation. This Plan shall not be
consummated and the Effective Date shall not occur unless and until the
following conditions have occurred or have been duly waived (if waivable)
pursuant to Section 9.04 below:

                                       40


          (a) the Confirmation Order shall have been entered and shall have
     become a Final Order and such order shall not have been vacated, reversed,
     stayed, modified, amended, enjoined or restrained by order of a court of
     competent jurisdiction;

          (b) all Plan Documents required to be executed or delivered under this
     Plan on or prior to the Effective Date shall be in a form that is
     reasonably acceptable to the Debtors and Saratoga;

          (c) all Plan Documents required to be executed or delivered under this
     Plan on or prior to the Effective Date shall have been executed and
     delivered by the parties thereto;

          (d) the Bankruptcy Court shall have entered an order (contemplated to
     be part of the Confirmation Order) authorizing and directing the Debtors
     and the Reorganized Debtors to take all actions necessary or appropriate to
     enter into, implement, and consummate this Plan Documents, contracts,
     instruments, releases, indentures and other agreements or documents
     created, amended, supplemented, modified or adopted in connection with this
     Plan;

          (e) the New ADLT Certificate of Incorporation shall have been filed
     with the Delaware Secretary of State in accordance with Delaware law, and
     all other actions shall have been taken to reincorporate ADLT in Delaware;

          (f) all authorizations, consents and regulatory approvals required, if
     any, in connection with this Plan's effectiveness shall have been obtained;

          (g) the New Credit Facility shall have become effective;

          (h) the New Indenture and all related documents shall have been
     entered into by the parties thereto;

          (i) [intentionally left blank]

          (j) [intentionally left blank]

          (k) the Saratoga Management Services Agreement shall have been entered
     into by the parties thereto;

          (l) the Senior Management Contracts shall have been entered into by
     the parties thereto;

          (m) the Management Incentive Plan shall have been adopted by ADLT and
     the Management Options to be issued on the Effective Date thereunder shall
     have been issued;

          (n) [intentionally left blank];

                                       41


          (o) no order of a court shall have been entered and shall remain in
     effect restraining the Debtors or Saratoga from consummating this Plan; and

          (p) an Indenture for the New Notes shall have been qualified by the
     Commission under the Trust Indenture Act of 1939, as amended.

     Section 9.03. Termination of Plan. The Effective Date must occur by the
Termination Date. If the Effective Date has not occurred by the Termination
Date, and the Termination Date has not been extended by the Debtors and
Saratoga, then this Plan shall be null and void and of no further effect.

     Section 9.04. Waiver of Conditions to Confirmation and Consummation. The
condition precedent to confirmation set forth in Section 9.01 may be waived only
by Saratoga with the consent of the Debtors. Any one or more of the conditions
to consummation in Section 9.02 may be waived at any time by a writing signed by
authorized representatives of each of the Debtors and Saratoga without notice or
order of the Bankruptcy Court or any further action other than proceeding to
consummation of this Plan. The Debtors shall provide prior written notice of the
Effective Date to the Creditors Committee and Saratoga.

                                   ARTICLE X

               OPERATION AND MANAGEMENT OF THE REORGANIZED DEBTORS

     Section 10.01. Post-Effective Date Operation of Business. From and after
the Effective Date, the Reorganized Debtors will continue to exist and engage in
business, in accordance with the applicable law in the respective jurisdictions
in which they are incorporated and pursuant to their respective articles of
incorporation and codes of regulations (by-laws) in effect prior to the
Effective Date, except to the extent such articles of incorporation and codes of
regulations (by-laws) are amended or superseded pursuant to this Plan; provided,
however, that as soon as practicable after the Effective Date, the Reorganized
Debtors shall cause Microsun, LRI and ADLT Services to be dissolved or merged
into one of the other Debtors. Without in any way limiting the foregoing, from
and after the Effective Date, the Reorganized Debtors will operate their
businesses substantially as described in the Disclosure Statement in all
material respects.

     Section 10.02. Post-Confirmation Officers and Directors. From and after the
Effective Date, the officers of the Reorganized Debtors (a) shall be those
Persons serving in those positions as set forth in the Disclosure Statement and
(b) will be reimbursed for all reasonable costs and expenses, and will receive
compensation, with all such payments to be made by the respective Reorganized
Debtors. From and after the Effective Date, there will be seven (7) members of
Reorganized ADLT's Board of Directors designated by Saratoga. The Board of
Directors for each of the Subsidiary Debtors shall consist of one (1) or more
members to be appointed by Reorganized ADLT's Board of Directors.

                                       42


                                   ARTICLE XI

                             EFFECTS OF CONFIRMATION

     Section 11.01. Discharge. To the fullest extent permitted by applicable law
(including, without limitation, section 105 of the Bankruptcy Code), and except
as otherwise provided in this Plan or in the Confirmation Order: (A) all
consideration distributed under this Plan shall be in exchange for, and in
complete satisfaction, settlement, discharge and release of, all Claims of any
nature whatsoever against the Debtors or any of their respective assets or
Properties and, regardless of whether any property shall have been distributed
or retained pursuant to this Plan on account of such Claims, upon the Effective
Date, the Debtors, and each of them, shall (i) be deemed discharged and released
under section 1141(d)(1)(A) of the Bankruptcy Code from any and all Claims,
including, but not limited to, demands and liabilities that arose before the
Confirmation Date, debts (as such term is defined in section 101(12) of the
Bankruptcy Code), Liens, security interests, and encumbrances of and against all
Property of the respective Estates, the Debtors and their Affiliates, that arose
before Confirmation, including, without limitation, all debts of the kind
specified in sections 502(g), 502(h) or 502(i) of the Bankruptcy Code, whether
or not (a) such Claim has been Allowed pursuant to section 502 of the Bankruptcy
Code, or (b) the Holder of such Claim has voted to accept this Plan and (ii)
terminate all Interests of the Holders of Old Preferred Stock, Old Common Stock
and Old Other Interests; and (B) as of the Confirmation Date, all entities,
including, without limitation, all Holders of Claims or Interests, shall be
barred and enjoined from asserting against the Debtors or the Reorganized
Debtors, their successors or their property any other or further Claims, debts,
rights, Causes of Action, liabilities or Interests relating to the Debtors based
upon any act, omission, transaction or other activity of any nature that
occurred prior to the Confirmation Date. In accordance with the foregoing,
except as provided in this Plan or the Confirmation Order, the Confirmation
Order shall be a judicial determination of discharge of all such Claims and
other debts and liabilities against the Debtors and termination of all Interests
of the Holders of Old Preferred Stock, Old Common Stock and Old Other Interests,
pursuant to sections 524 and 1141 of the Bankruptcy Code, and such discharge and
termination shall void any judgment obtained against the Debtors at any time, to
the extent that such judgment relates to a discharged Claim or terminated
Interest.

     Section 11.02. Injunction.

          (a) Discharged Claims and Terminated Interests. Except as otherwise
     expressly provided for in this Plan or the Confirmation Order and to the
     fullest extent authorized or provided by the Bankruptcy Code, including
     sections 524 and 1141 thereof, the entry of the Confirmation Order shall,
     provided that the Effective Date occurs, permanently enjoin all Persons
     that have held, currently hold or may hold a Claim or other debt or
     liability that is discharged or an Interest or other right of an equity
     security holder that is Impaired or terminated pursuant to the terms of
     this Plan from taking any of the following actions against the Debtors, the
     Reorganized Debtors or their respective Properties on account of any such
     discharged Claims, debts or liabilities or such terminated Interests or
     rights: (a) commencing, conducting or continuing in any manner, directly or
     indirectly, any suit, action or other proceeding of any kind; (b)
     enforcing, levying, attaching, collecting or otherwise recovering in any
     manner or by any means, whether directly or indirectly, any judgment,
     award, decree or order; (c) creating,

                                       43


     perfecting or enforcing in any manner directly or indirectly, any Lien or
     encumbrance of any kind; (d) asserting any setoff, offset, right of
     subrogation or recoupment of any kind, directly or indirectly, against any
     debt, liability or obligation due to the Debtors or the Reorganized
     Debtors; and (e) proceeding in any manner in any place whatsoever,
     including employing any process, that does not conform to or comply with or
     is inconsistent with the provisions of this Plan.

          (b) Released Claims. As of the Effective Date, the Confirmation Order
     shall constitute an injunction permanently enjoining any Person that has
     held, currently holds or may hold a Claim, demand, debt, right, Cause of
     Action or liability that is released pursuant to Section 11.04 of this Plan
     from enforcing or attempting to enforce any such Claim, demand, debt,
     right, Cause of Action or liability against any (i) Debtor, (ii)
     Reorganized Debtor, (iii) agent or Professional of the Debtors, (iv)
     director, officer or employee of any Debtor who continues in such position
     subsequent to the Effective Date or (v) former director, officer or
     employee of any Debtor, or any of their respective property, based on,
     arising from or relating to, in whole or in part, any act, omission, or
     other occurrence taking place on or prior to the Effective Date with
     respect to or in any way relating to the Chapter 11 Cases, all of which
     claims, demands, debts, rights, Causes of Action or liabilities shall be
     deemed released on the Effective Date; provided, however, that with respect
     to the former directors, officers and employees of the Debtors, this
     injunction shall apply only to the enforcement of Claims, demands, debts,
     rights, Causes of Action or liabilities with respect to which such former
     directors, officers and employees would be entitled to indemnification from
     the Debtors or the Reorganized Debtors under contract or law; and, provided
     further, however, that this injunction shall not apply to (a) any claims
     Creditors may assert under this Plan to enforce their rights thereunder to
     the extent permitted by the Bankruptcy Code or (b) any claims Creditors or
     other third parties may have against each other, which claims are not
     related to the Debtors and the Reorganized Debtors, it being understood,
     however, that any defenses, offsets or counterclaims of any kind or nature
     whatsoever which the Debtors may have or assert in respect of any of the
     claims of the type described in (a) or (b) of this proviso are fully
     preserved.

     Section 11.03. Exculpation. None of the Debtors, the Reorganized Debtors,
the Creditors Committee, their respective Professionals, Saratoga or the
Exculpated Persons shall have or incur any liability to any Person, including,
without limitation, any Holder of a Claim or Interest or any other party in
interest, or any of their respective agents, employees, representatives,
financial advisors, attorneys or affiliates or any of their successors or
assigns, for any act taken or omission made in good faith in connection with,
relating to, or arising out of, the Chapter 11 Cases, Filing, negotiating,
prosecuting, administrating, formulating, implementing, confirming or
consummating this Plan or the Property to be distributed under this Plan,
including all pre-petition and post-petition activities leading to the
promulgation and confirmation of this Plan, the Disclosure Statement (including
any information provided or statement made in the Disclosure Statement or
omitted therefrom), or any contract, instrument, release or other agreement or
document created in connection with or related to this Plan or the
administration of the Debtors or these Chapter 11 Cases.

     Section 11.04. Releases.

                                       44


          (a) Releases by Debtors. Effective as of the Confirmation Date, but
     subject to the occurrence of the Effective Date, and except as otherwise
     provided in this Plan or the Confirmation Order, for good and valuable
     consideration, the adequacy of which is hereby confirmed, the Debtors and
     the Reorganized Debtors, in their individual capacities and as
     debtors-in-possession, shall be deemed to have forever released, waived and
     discharged (i) the agents and Professionals of the Debtors, (ii) the
     directors, officers and employees of the Debtors who continue in such
     positions subsequent to the Effective Date, (iii) the former directors,
     officers and employees of the Debtors, (iv) the members of the Creditors
     Committee and its Professionals and (v) GE and Saratoga, from any and all
     claims, obligations, suits, judgments, damages, demands, debts, rights,
     Causes of Action and liabilities (other than the rights of the Debtors or
     the Reorganized Debtors to enforce this Plan, this Plan Documents,
     contracts, instruments, releases, indentures and other agreements or
     documents delivered thereunder), whether for tort, fraud, contract,
     violations of federal or state securities laws, or otherwise, whether
     liquidated or unliquidated, fixed or contingent, matured or unmatured,
     known or unknown, foreseen or unforeseen, then existing or thereafter
     arising, in law, equity or otherwise that are based in whole or part on any
     act, omission, transaction, event or other occurrence taking place on or
     prior to the Effective Date in any way relating to the Debtors, the
     Reorganized Debtors, the Chapter 11 Cases or this Plan; provided, however,
     that no person identified in subclauses (i)-(v) above shall be released or
     discharged from any Claims, obligations, suits, judgments, debts or Causes
     of Action arising out of or in connection with indebtedness for money
     borrowed by any such person from the Debtors, or for goods, services or
     other consideration provided to such person by the Debtors pursuant to
     contract or otherwise, unless otherwise expressly provided for elsewhere in
     this Plan; and provided, further, however that the persons identified in
     subclause (iii) above shall be released under this Section 11.04(a) only
     for claims, obligations, suits, judgments, damages, rights, Causes of
     Action and liabilities with respect to which such persons would be entitled
     to indemnification from the Debtors or the Reorganized Debtors under
     contract or law.

          (b) Releases by Holders of Claims and Interests. Effective as of the
     Confirmation Date, but subject to the occurrence of the Effective Date, and
     except as otherwise provided in this Plan or the Confirmation Order, to the
     fullest extent permitted under applicable law, in consideration for the
     obligations of the Persons set forth below under this Plan and, if
     applicable, the Cash, securities, contracts, releases and other agreements
     or documents to be delivered in connection with this Plan, each Holder (as
     well as any trustee or agent on behalf of each such Holder) of a Claim or
     an Interest and any Affiliate of any such Holder shall be deemed to have
     forever waived, released and discharged (i) the Debtors, (ii) the
     Reorganized Debtors, (iii) the agents and Professionals of the Debtors,
     (iv) the directors, officers and employees of the Debtors who continue in
     such positions subsequent to the Effective Date, (v) the former directors,
     officers and employees of the Debtors, (vi) Saratoga, and (vii) the members
     of the Creditors Committee and its Professionals from any and all claims,
     obligations, suits, judgments, damages, rights, Causes of Action and
     liabilities, whether for tort, fraud, contract, violations of federal or
     state securities laws, or otherwise, whether liquidated or unliquidated,
     fixed or contingent, matured or unmatured, known or unknown, foreseen or
     unforeseen, then existing or thereafter arising, in law, equity or
     otherwise that are based

                                       45


     in whole or part on any act, omission, transaction, event or other
     occurrence taking place on or prior to the Effective Date relating to the
     Debtors, the Reorganized Debtors or any Affiliate of the Debtors, the
     Chapter 11 Cases or this Plan, and/or which may have directly or indirectly
     impacted or harmed in any way the value of any Claim against or Interest in
     the Debtors or their Affiliates; provided, however, that the persons
     identified in subclause (v) above shall be released under this Section
     11.04(b) only for claims, obligations, suits, judgments, damages, rights
     Causes of Action and liabilities with respect to which such persons would
     be entitled to indemnification from the Debtors or the Reorganized Debtors
     under contract or law; provided further, that such waiver, release and
     discharge shall be effective as to the above-named released parties (other
     than the Debtors and the Reorganized Debtors) only if such Holder
     affirmatively marked or checked off the applicable box on the Ballot cast
     by such Holder indicating such Holder's agreement to grant such waiver,
     release and discharge; if such Holder did not cast a Ballot or did not mark
     or check off the applicable box on its Ballot, such Holder shall not be
     deemed to have granted such waiver, release and discharge as to such
     non-Debtor parties.

     Section 11.05. Indemnification. To the extent not inconsistent with this
Plan or the Confirmation Order and to the fullest extent permitted by applicable
law, including, without limitation, the extent provided in the Debtors'
constituent documents, contracts (including, without limitation, any
indemnification agreement), statutory law or common law, the Reorganized Debtors
will indemnify, defend, hold harmless and reimburse the Exculpated Persons from
and against any and all losses, claims, Causes of Action, damages, fees,
expenses, liabilities and actions (A) for any act taken or omission made in good
faith in connection with or in any way related to negotiating, formulating,
filing, implementing, confirming or consummating this Plan, the Disclosure
Statement or any contract, instrument, release or other agreement or document
created in connection with this Plan or the administration of the Chapter 11
Cases or (B) for any act or omission in connection with or arising out of the
administration of this Plan or the Property to be distributed under this Plan or
the operations or activities of the Debtors or the Reorganized Debtors, and any
Claims of any such Exculpated Person against the Debtors or the Reorganized
Debtors on account of such indemnification obligations shall be unaltered and
Unimpaired within the meaning of section 1124(1) of the Bankruptcy Code, except
that neither the Debtors nor the Reorganized Debtors shall have any obligation
to indemnify any Exculpated Person for any acts or omissions that constitute
gross negligence or willful misconduct as such is finally determined by the
Bankruptcy Court. Such indemnification obligations shall survive unaffected by
entry of the Confirmation Order, irrespective of whether such indemnification is
owed for an act or event occurring before or after the Petition Date.

     Section 11.06. Other Documents and Actions. The Debtors and the Reorganized
Debtors are authorized, subject to Saratoga's consent, to execute such documents
and take such other action as is necessary to effectuate the transactions
provided for in this Plan.

     Section 11.07. Term of Injunctions or Stays. Unless otherwise provided
herein or in the Confirmation Order, all injunctions or stays provided for in
the Chapter 11 Cases under sections 105(a) or 362 of the Bankruptcy Code, or
otherwise, and in existence on the Confirmation Date, shall remain in full force
and effect until the Effective Date.

                                       46


     Section 11.08. Preservation of Insurance. Except as necessary to be
consistent with this Plan, this Plan and the discharge provided herein shall not
diminish or impair (A) the enforceability of insurance policies that may cover
Claims against the Debtors or any other Person or Entity or (B) the continuation
of workers' compensation programs in effect, including self-insurance programs.

     Section 11.09. Guaranties. Notwithstanding the existence of guaranties by
the Debtors of obligations of any Entity or Entities, and the Debtors' joint
obligations with another Entity or Entities with respect to the same
obligations, all Claims against the Debtors based upon any such guaranties shall
be satisfied, discharged and released in the manner provided in this Plan and
the Holders of Claims shall be entitled to only one distribution with respect to
any given obligation of the Debtors.

     Section 11.10. Waiver of Subordination Rights. Any distributions under this
Plan shall be received and retained free of and from any obligations to hold or
transfer the same to any other Creditor, and shall not be subject to levy,
garnishment, attachment or other legal process by any Holder by reason of
claimed contractual subordination rights and the Confirmation Order shall
constitute an injunction enjoining any Person from enforcing or attempting to
enforce any contractual, legal or equitable subordination rights to Property
distributed under this Plan, in each case other than as provided in this Plan.

     Section 11.11. No Successor Liability. Except as otherwise expressly
provided in this Plan, the Reorganized Debtors do not, pursuant to this Plan or
otherwise, assume, agree to perform, pay, or indemnify Creditors or otherwise
have any responsibilities for any liabilities or obligations of the Debtors
relating to or arising out of the operations of or assets or Property of the
Debtors, whether arising prior to, on, or after the Confirmation Date. The
Reorganized Debtors are not, and shall not be, successors to the Debtors by
reason of any theory of law or equity, and shall not have any successor or
transferee liability of any kind or character, except that the Reorganized
Debtors shall assume the obligations specified in this Plan and the Confirmation
Order.

                                  ARTICLE XII

                            RETENTION OF JURISDICTION

     Section 12.01. Exclusive Jurisdiction of Bankruptcy Court. Notwithstanding
the entry of the Confirmation Order and the occurrence of the Effective Date,
the Bankruptcy Court shall retain after the Effective Date exclusive
jurisdiction of all matters arising out of, arising in or related to, the
Chapter 11 Cases to the fullest extent permitted by applicable law, including,
without limitation, jurisdiction to:

          (a) classify or establish the priority, secured or unsecured status of
     any Claim or Interest (whether Filed before or after the Effective Date and
     whether or not contingent, Disputed or unliquidated) or resolve any dispute
     as to the treatment necessary to Reinstate a Claim pursuant to this Plan;

                                       47


          (b) grant or deny any applications for allowance of compensation or
     reimbursement of expenses pursuant to sections 330, 331 or 503(b) of the
     Bankruptcy Code or otherwise provided for in this Plan, for periods ending
     on or before the Effective Date;

          (c) determine and resolve any matters related to the assumption,
     assumption and assignment, or rejection of any executory contract or
     unexpired lease to which any Debtor is a party or with respect to which any
     Debtor may be liable, and to hear, determine and, if necessary, liquidate
     any Claims arising therefrom;

          (d) ensure that all payments due under this Plan and performance of
     the provisions of this Plan are accomplished as provided herein and resolve
     any issues relating to distributions to Holders of Allowed Claims or
     Allowed Interests pursuant to the provisions of this Plan;

          (e) construe, take any action and issue such orders, prior to and
     following the Confirmation Date and consistent with section 1142 of the
     Bankruptcy Code, as may be necessary for the enforcement, implementation,
     execution and consummation of this Plan and all Plan Documents, contracts,
     instruments, releases, indentures and other agreements or documents created
     in connection with this Plan, including, without limitation, the Disclosure
     Statement and the Confirmation Order, for the maintenance of the integrity
     of this Plan and protection of the Reorganized Debtors in accordance with
     sections 524 and 1141 of the Bankruptcy Code following consummation;

          (f) determine and resolve any cases, controversies, suits or disputes
     that may arise in connection with the consummation, interpretation,
     implementation or enforcement of this Plan (and all Exhibits to this Plan)
     or the Confirmation Order, including the indemnification and injunction
     provisions set forth in and contemplated by this Plan or the Confirmation
     Order, or any Entity's rights arising under or obligations incurred in
     connection therewith;

          (g) hear any application of the Debtors or the Reorganized Debtors to
     modify this Plan before or after the Effective Date pursuant to section
     1127 of the Bankruptcy Code and Section 13.04 hereof or modify the
     Disclosure Statement, the Confirmation Order or any contract, instrument,
     release, indenture or other agreement or document created in connection
     with this Plan, the Disclosure Statement or the Confirmation Order, or
     remedy any defect or omission or reconcile any inconsistency in any
     Bankruptcy Court order, this Plan, the Disclosure Statement, the
     Confirmation Order or any contract, instrument, release, indenture or other
     agreement or document created in connection with this Plan, the Disclosure
     Statement or the Confirmation Order, in such manner as may be necessary or
     appropriate to consummate this Plan, to the extent authorized by the
     Bankruptcy Code and this Plan;

          (h) issue injunctions, enter and implement other orders or take such
     other actions as may be necessary or appropriate to restrain interference
     by any Entity with consummation, implementation or enforcement of this Plan
     or the Confirmation Order;

                                       48


          (i) enter and implement such orders as are necessary or appropriate if
     the Confirmation Order is for any reason modified, stayed, reversed,
     revoked or vacated;

          (j) determine any other matters that may arise in connection with or
     relating to this Plan, the Disclosure Statement, the Confirmation Order or
     any contract, instrument, release, indenture or other agreement or document
     created in connection with this Plan, the Disclosure Statement or the
     Confirmation Order, except as otherwise provided in this Plan;

          (k) determine such other matters and for such other purposes as may be
     provided in the Confirmation Order;

          (l) hear and determine any other matters related hereto and not
     inconsistent with chapter 11 of the Bankruptcy Code;

          (m) continue to enforce the automatic stay through the Effective Date;

          (n) hear and determine (i) disputes arising in connection with the
     interpretation, implementation or enforcement of this Plan or (ii) issues
     presented or arising under this Plan, including disputes among Holders and
     arising under this Plan Documents, or other agreements, documents or
     instruments executed in connection with this Plan;

          (o) enter a final decree closing the Chapter 11 Cases or converting
     them into chapter 7 cases; and

          (p) determine and resolve any and all controversies relating to the
     rights and obligations of the Old Indenture Trustee, the Voting Agent and
     the Disbursing Agent in connection with the Chapter 11 Cases, including,
     without limitation, any dispute arising in connection with the payment of
     the reasonable fees and expenses of the Old Indenture Trustee, the Voting
     Agent and the Disbursing Agent in connection with their duties in the
     Chapter 11 Cases.

     Section 12.02. Non-Exclusive Jurisdiction of Bankruptcy Court. Following
the Effective Date, the Bankruptcy Court shall retain non-exclusive jurisdiction
of the Chapter 11 Cases to the fullest extent permitted by applicable law,
including, without limitation, jurisdiction to:

          (a) allow, disallow, determine, liquidate or estimate any Claim or
     Interest, including the compromise, settlement and resolution of any
     request for payment of any Claim, the resolution of any Objections to the
     allowance of Claims or Interests and to hear and determine any other issue
     presented hereby or arising hereunder, including during the pendency of any
     appeal relating to any Objection to such Claim or Interest (to the extent
     permitted under applicable law);

          (b) recover all assets of the Debtors and Property of their respective
     Estates, wherever located;

                                       49


          (c) hear and determine any motions or contested matters involving
     taxes, tax refunds, tax attributes and tax benefits and similar or related
     matters with respect to the Debtors or the Debtors' respective Estates
     arising prior to the Effective Date or relating to the period of
     administration of the Chapter 11 Cases, including, without limitation,
     matters concerning federal, state and local taxes in accordance with
     sections 346, 505 and 1146 of the Bankruptcy Code;

          (d) hear and determine any motions, applications, adversary
     proceedings, contested matters and other litigated matters pending on,
     Filed or commenced after the Effective Date that may be commenced by the
     Debtors thereafter, including proceedings with respect to the rights of the
     Debtors to recover Property under sections 542, 543 or 553 of the
     Bankruptcy Code, or to bring any Avoidance Action, or to otherwise collect
     to recover on account of any claim or Cause of Action that the Debtors may
     have; and

          (e) hear any other matter not inconsistent with the Bankruptcy Code.

     Section 12.03. Failure of Bankruptcy Court to Exercise Jurisdiction. If the
Bankruptcy Court abstains from exercising or declines to exercise jurisdiction
over any matter arising under, arising in or related to the Debtors, including
with respect to the matters set forth above in Section 12.01 and Section 12.02
hereof, this Article XII shall not prohibit or limit the exercise of
jurisdiction by any other court having competent jurisdiction with respect to
such subject matter.

                                  ARTICLE XIII

                            MISCELLANEOUS PROVISIONS

     Section 13.01. Binding Effect of Plan. The provisions of this Plan shall be
binding upon and inure to the benefit of the Debtors, Saratoga, the Estates, the
Reorganized Debtors, any Holder of any Claim or Interest treated herein or any
Person named or referred to in this Plan, the Old Indenture Trustee and each of
their respective heirs, executors, administrators, representatives,
predecessors, successors, assigns, agents, officers and directors, and, to the
fullest extent permitted under the Bankruptcy Code and other applicable law,
each other Person affected by this Plan.

     Section 13.02. Withdrawal of this Plan. The Debtors and Saratoga, acting
jointly, reserve the right, at any time prior to Confirmation of this Plan, to
revoke or withdraw this Plan. If this Plan is revoked or withdrawn or if the
Confirmation Date does not occur, this Plan shall be null and void and have no
force and effect. In such event, nothing contained herein shall be deemed to
constitute a waiver or release of any claims by the Debtors or Saratoga or
against the Debtors or any other Person or to prejudice in any manner the rights
of the Debtors, Saratoga or any Person in any further proceedings involving the
Debtors.

     Section 13.03. Final Order. Except as otherwise expressly provided in this
Plan, any requirement in this Plan for a Final Order may be waived by the
Debtors and Saratoga, acting jointly, or, after the Effective Date, the
Reorganized Debtors upon written notice to the Bankruptcy Court.

                                       50


     Section 13.04. Modification of this Plan. The Debtors and Saratoga, acting
jointly, may alter, amend or modify this Plan, including all exhibits to this
Plan, in accordance with section 1127 of the Bankruptcy Code or as otherwise
permitted at any time prior to the Confirmation Date. After the Confirmation
Date and prior to the substantial consummation of this Plan, and in accordance
with the provisions of section 1127(b) of the Bankruptcy Code and the Bankruptcy
Rules, the Debtors and Saratoga and any party in interest may, so long as the
treatment of Holders of Claims or Interests under this Plan is not adversely
affected, institute proceedings in the Bankruptcy Court to remedy any defect or
omission or to reconcile any inconsistencies in this Plan, the Disclosure
Statement or the Confirmation Order and any other matters as may be necessary to
carry out the purposes and effects of this Plan; provided, however, prior notice
of such proceedings shall be served in accordance with Bankruptcy Rules 2002 and
9014.

     Section 13.05. Business Days. If any payment or act under this Plan is
required to be made or performed on a date that is not a Business Day in any
particular location where performance was to occur, then the making of such
payment or the performance of such act may be completed on the next succeeding
Business Day, without interest, but shall be deemed to have been completed as of
the required date.

     Section 13.06. Severability. Should the Bankruptcy Court determine, on or
prior to the Confirmation Date, that any provision of this Plan is either
illegal on its face or illegal as applied to any Claim or Interest, such
provision shall be unenforceable as to all Holders of Claims or Interests or to
the specific Holder of such Claim or Interest, as the case may be, as to which
such provision is illegal. Unless otherwise determined by the Bankruptcy Court,
such a determination of unenforceability shall in no way limit or affect the
enforceability and operative effect of any other provision of this Plan. The
Debtors reserve the right not to proceed with Confirmation or consummation of
this Plan if any such ruling occurs.

     Section 13.07. Governing Law. EXCEPT TO THE EXTENT THAT THE BANKRUPTCY CODE
OR BANKRUPTCY RULES OR OTHER FEDERAL LAWS ARE APPLICABLE, AND SUBJECT TO THE
PROVISIONS OF ANY CONTRACT, INSTRUMENT, RELEASE, INDENTURE OR OTHER AGREEMENT OR
DOCUMENT ENTERED INTO IN CONNECTION WITH THIS PLAN, THE CONSTRUCTION,
IMPLEMENTATION AND ENFORCEMENT OF THIS PLAN AND ALL RIGHTS AND OBLIGATION
ARISING UNDER THIS PLAN SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO
CONFLICTS-OF-LAW PRINCIPLES WHICH WOULD APPLY THE LAW OF A JURISDICTION OTHER
THAN THE STATE OF OHIO OR THE UNITED STATES OF AMERICA.

     Section 13.08. Dissolution of Committees. On the Effective Date, the
Committees shall be automatically dissolved and all members, Professionals and
agents of the Committees shall be deemed released of their duties,
responsibilities and obligations, and shall be without further duties,
responsibilities and authority in connection with the Debtors, the Chapter 11
Cases, this Plan or its implementation.

                                       51


     Section 13.09. Payment of Statutory Fees. All U.S. Trustee's Fee Claims, as
determined, if necessary, by the Bankruptcy Court at the hearing pursuant to
section 1128 of the Bankruptcy Code, shall be paid on or before the Effective
Date.

     Section 13.10. Notices. Any notice required or permitted to be provided
under this Plan shall be in writing and served by either (A) certified mail,
return receipt requested, postage prepaid, (B) hand delivery, (C) reputable
overnight delivery service, freight prepaid or (D) facsimile, to be addressed as
follows:

     If to Debtors/Reorganized Debtors:

          Advanced Lighting Technologies, Inc.
          32000 Aurora Road
          Solon, Ohio  44139
          Attn.: Wayne R. Hellman, Chief Executive Officer
          facsimile:  (440) 519-0503

     With a copy to:

          Jenner & Block, LLC
          One IBM Plaza
          Chicago, Illinois 60611
          Attn.: Jeff J. Marwil
          Jerry L. Switzer, Jr.
          Peter J. Young
          facsimile:  (312) 527-0484

     If to Creditors Committee:

          GSC Partners
          500 Campus Drive, #220
          Florham Park, New Jersey  07932
          Attn.: Thomas Libassi
          facsimile:  (973) 437-1037

     With copies to:

          Stroock & Stroock & Lavan LLP
          180 Maiden Lane
          New York, New York  10038
          Attn.: Michael J. Sage
          Kristopher M. Hansen
          A. Victor Glaser
          facsimile:  (212) 806-6006

                   and

                                       52


          Kaye Scholer LLC
          Three First National Plaza
          70 West Madison Street
          Suite 4100
          Chicago, Illinois 60602
          Attn:  Michael B. Solow
          Joel L. Miller
          Facsimile:  (312) 583-2360

     If to Equity Committee:

          Robert F. Spangler
          4708 Hunt Creek
          Harrisburg, Pennsylvania  17112
          facsimile:  (717) 652-1948

     With a copy to:

          Shaw, Gussis, Fishman, Glantz, Wolfson & Towbin, LLC
          1144 West Fulton Street, Suite 200
          Chicago, Illinois  60607
          Attn.: Robert M. Fishman
          Brian M. Graham
          Mark L. Radtke
          facsimile:  (312) 541-0155

     If to Old Indenture Trustee:

          The Bank of New York
          101 Barclay Street, 8 West
          New York, New York  10286
          Attn.: Gerard Facendola
          facsimile:  (212) 815-5131

     If to GE:

          General Electric Company
          c/o GE Consumer Products
          Appliance Park
          AP 2-225
          Louisville, Kentucky  40225
          Attn.: Raymond M. Burse, General Counsel
          facsimile:  (502) 452-0347

                                       53


     With a copy to:

          Wyatt, Tarrant & Combs, LLP
          250 W. Main Street, Suite 1600
          Lexington, Kentucky 40502
          Attn:  Mary L. Fullington
          facsimile:  (859) 259-0649

     If to Saratoga:

          Saratoga Lighting Holdings LLC
          4th Floor
          535 Madison Avenue
          New York, NY 10022
          Attn.: Christian Oberbeck
          facsimile:  (212) 906-7800

     With a copy to:

          Davis Polk & Wardwell
          450 Lexington Avenue
          New York, N.Y. 10017
          Attn:  Stephen H. Case
          facsimile:  (212) 450-4800


     If to the United States Trustee:

          Ira Bodenstein, U.S. Trustee (Region 11)
          227 West Monroe Street, Suite 3350
          Chicago, Illinois  60606
          Attn:  Roman Sukley
          facsimile:  (312) 886-5794

     Section 13.11. Filing of Additional Documents. On or before substantial
consummation of this Plan, the Debtors, with the consent of Saratoga, shall
issue, execute, deliver, and File with the Bankruptcy Court or record any
agreements and other documents, and take any action as may be necessary or
appropriate to effectuate, consummate and further evidence the terms and
conditions of this Plan.

     Section 13.12. Section 1125 of the Bankruptcy Code. (a) The Debtors and
Saratoga have, and upon Confirmation of this Plan shall be deemed to have,
solicited acceptances of this Plan in good faith and in compliance with the
applicable provisions of the Bankruptcy Code and (b) the Debtors and Saratoga
(and their Affiliates, officers, directors, employees, consultants, agents,
advisors, members, attorneys, accountants, financial advisors, other
representatives and Professionals) have participated in good faith and in
compliance with the applicable provisions of the Securities Act and the
Bankruptcy Code in the offer, issuance, sale, and purchase of the

                                       54


securities offered and sold under this Plan, and are not, and on account of such
offer, issuance, sale, solicitation, and/or purchase will not be, liable at any
time for the violation of any applicable law, rule, or regulation governing the
solicitation of acceptances or rejections of this Plan or the offer, issuance,
sale, or purchase of the securities offered and sold under this Plan.

     Section 13.13. Section 1146 Exemption. To the fullest extent permitted
under section 1146(c) of the Bankruptcy Code, the issuance, transfer or exchange
of any security under this Plan, if any, or the execution, delivery or recording
of an instrument of transfer under this Plan, or the revesting, transfer or sale
of any real or other Property of or to the Debtors or the Reorganized Debtors,
shall not be taxed under any state or local law imposing a stamp tax, transfer
tax or similar tax or fee. Consistent with the foregoing, each recorder of deeds
or similar official for any county, city or governmental unit in which any
instrument hereunder is to be recorded shall, pursuant to the Confirmation
Order, be ordered and directed to accept such instrument, without requiring the
payment of any documentary stamp tax, deed stamps, stamp tax, transfer tax,
mortgage recording tax, intangible tax or similar tax.

     Section 13.14. Section 1145 Exemption. To the fullest extent permitted
under section 1145 of the Bankruptcy Code, the issuance of the New Notes, the
New Common Stock, the New Preferred Stock and the Management Options shall be
exempt from the registration requirements of Section 5 of the Securities Act and
any and all federal, state and local laws requiring the registration or
licensing of an issuer, underwriter, broker or dealer in such securities.

     Section 13.15. Time. Unless otherwise specified herein, in computing any
period of time prescribed or allowed by this Plan, the day of the act or event
from which the designated period begins to run shall not be included. The last
day of the period so computed shall be included, unless it is not a Business Day
in any location where performance is to occur, in which event the period runs
until the end of next succeeding day that is a Business Day. Otherwise, the
provisions of Bankruptcy Rule 9006 shall apply.

     Section 13.16. No Attorneys' Fees. No attorneys' fees will be paid by the
Debtors with respect to any Claim or Interest except as expressly specified
herein or Allowed by a Final Order of the Bankruptcy Court.

     Section 13.17. No Injunctive Relief. No Claim or Interest shall under any
circumstances be entitled to specific performance or other injunctive, equitable
or other prospective relief.

     Section 13.18. Non-Voting Equity Securities. The Debtors shall comply with
the provisions of section 1123(a)(6) of the Bankruptcy Code.

     Section 13.19. Continued Confidentiality Obligations. Pursuant to the terms
thereof, members of, and advisors and Professionals to, any Committee, any other
Holder of a Claim or Interest and their respective predecessors, successors and
assigns, shall continue to be obligated and bound by the terms of any
confidentiality agreement executed by them in connection with these Chapter 11
Cases or the Debtors, to the extent that such agreement, by its terms, may
continue in effect after the Confirmation Date.

     Section 13.20. No Admissions or Waivers. Notwithstanding anything herein to
the contrary, nothing contained in this Plan shall be deemed an admission or
waiver by the Debtors

                                       55


with respect to any matter set forth herein, including, without limitation,
liability on any Claim or Interest or the propriety of any classification of any
Claim or Interest.

     Section 13.21. Entire Agreement. This Plan and Exhibits set forth the
entire agreement and undertakings relating to the subject matter hereof and they
supersede all prior discussions and documents. The Debtors shall not be bound by
any terms, conditions, definitions, warranties, understandings, or
representations with respect to the subject matter hereof, other than as
expressly provided for herein.

     Section 13.22. Waiver. The Debtors and Saratoga, acting jointly, or the
Reorganized Debtors, as applicable, reserve the right to waive any of their
rights under this Plan, and any conditions precedent provided for under this
Plan.

     Section 13.23. Bar Date for Professionals. Applications for compensation
for services rendered and reimbursement of expenses incurred by Professionals
(a) from the later of the Petition Date or the date on which retention was
approved through the Effective Date or (b) at any time during the Chapter 11
Cases when such compensation is sought pursuant to sections 503(b)(3) through
(b)(5) of the Bankruptcy Code, shall be Filed no later than forty-five (45) days
after the Effective Date or such later date as the Bankruptcy Court approves,
and shall be served on (i) the Debtors, (ii) counsel to the Debtors, (iii)
counsel to the Creditors Committee, (iv) counsel for the Equity Committee and
(v) the United States Trustee, at the addresses set forth in Section 13.10 of
this Plan. Applications that are not timely Filed shall not be considered by the
Court. The Reorganized Debtors may pay any Professional fees and expenses
incurred after the Effective Date without any application to the Bankruptcy
Court.

                              CONFIRMATION REQUEST

     The Debtors hereby request confirmation of this Plan pursuant to section
1129(a) or section 1129(b) of the Bankruptcy Code.

Dated: The Date Set Forth.
       On the Cover Page


Jeff J. Marwil (06194504)
Jerry L. Switzer, Jr. (06210229)
Peter J. Young (06278765)
Jenner & Block, LLC
One IBM Plaza
Chicago, Illinois 60611
(312) 222-9350 (312) 527-0484 (Fax)

Counsel for Debtors and Debtors-in-Possession

                                       56


                                    EXHIBIT A
            To First Amended Joint Chapter 11 Plan of Reorganization

                           Management Incentive Plan


               [To be filed under separate cover at a later date.]









                                    EXHIBIT B
            To First Amended Joint Chapter 11 Plan of Reorganization

                      New ADLT Certificate of Incorporation


               [To be filed under separate cover at a later date.]









                                    EXHIBIT C
            To First Amended Joint Chapter 11 Plan of Reorganization

                                New ADLT By-Laws


               [To be filed under separate cover at a later date.]









                                    EXHIBIT D
            To First Amended Joint Chapter 11 Plan of Reorganization

                                  New Indenture


               [To be filed under separate cover at a later date.]









                                    EXHIBIT E
            To First Amended Joint Chapter 11 Plan of Reorganization


               [To be filed under separate cover at a later date.]











                                    EXHIBIT F
            To First Amended Joint Chapter 11 Plan of Reorganization

                       Form of Senior Management Contracts

               [To be filed under separate cover at a later date.]







                                    EXHIBIT G
            To First Amended Joint Chapter 11 Plan of Reorganization


               [To be filed under separate cover at a later date.]











                                    EXHIBIT H
            To First Amended Joint Chapter 11 Plan of Reorganization

                     Saratoga Management Services Agreement

               [To be filed under separate cover at a later date.]





                                    Annex B
                            to Disclosure Statement
                            -----------------------

                             Financial Projections
                             ---------------------





Advanced Lighting Technologies, Inc.
Projected Free Cash Flow
Dollars in Thousands

                                                                                                 
                                                 1Q-04    2Q-04   3Q-04    4Q-04     2004    1Q-05   2Q-05   3Q-05   4Q-05     2005
                                                 -----    -----   -----    -----     ----    -----   -----   -----   -----     ----

Recurring EBITDA                                 5,319    5,578   6,622    6,434   23,951    6,885   6,966   7,473   7,061   28,386
Less:  Capex                                    (1,341)  (1,341) (1,341)  (1,341)  (5,364)  (1,704) (1,704) (1,704) (1,704)  (6,817)
Less:  Cash Taxes                                    -        -       -     (695)    (695)       -       -       -    (870)    (870)
Change in Working Capital - Source/(Use)
   Receivables - Net                              (575)  (1,397) (1,341)  (1,739)  (5,052)  (2,061) (2,780)  2,201  (1,261)  (3,901)
   Inventory                                     2,264     (407)    (52)     (20)   1,785   (1,115)    (62)    (67)    (26)  (1,271)
   Post-Petition Payables                          536    2,560  (5,163)     896   (1,172)   1,334     435     915     108    2,792
   Prepaid Expenses                                 41       62     (87)      13       28      (42)     66     (96)     14      (58)
   Accrued Expenses                                126     (247)      -        -     (121)     558       -       -       -      558
   Interest Expense                               (647)    (659) (2,024)    (502)  (3,832)  (5,105)   (547) (5,095)   (507) (11,254)
                                                -------  ------- -------  -------  ------   ------- ------- ------- -------  -------
Free Cash Flow                                   5,721    4,148  (3,386)   3,045    9,528   (1,249)  2,373   3,627   2,816    7,567

 Classified Claims
 Class 1(a) - Miscellaneous Secured Claims           -       (7)    (20)     (20)     (47)     (20)    (20)    (20)    (19)     (79)
 Class 1(b) - Secured Claims of GE                   -        -       -        -        -        -       -       -       -        -
 Class 2 - Classified Priority Claims                -      (24)      -        -      (24)       -       -       -       -        -
 Class 3 - Old Notes                                 -        -       -        -        -        -       -       -       -        -
 Class 4 - ADLT General Unsecured                    -        -  (1,785)       -   (1,785)       -       -       -       -        -
 Class 5 - Subsidiary Debtor General Unsecured       -        -  (1,958)       -   (1,958)       -       -       -       -        -
 Class 6 - Old Preferred Stock Interests             -        -       -        -        -        -       -       -       -        -
 Class 7 - Old Common Stock Interests                -        -  (2,500)       -   (2,500)       -       -       -       -        -
 Class 8 - Old Other Interests                       -        -       -        -        -        -       -       -       -        -
 Class 9 - Subsidiary Interests                      -        -       -        -        -        -       -       -       -        -
                                                -------  ------- -------  -------  ------   ------- ------- ------- -------  -------
 Total Claims                                        -      (30) (6,264)     (20)  (6,314)     (20)    (20)    (20)    (19)     (79)
 Net Cash Flow                                   5,721    4,118  (9,650)   3,025    3,214   (1,269)  2,354   3,607   2,797    7,489

 Revolver Borrowing Capacity                     4,030   12,434   9,281   12,558   12,558   11,017  13,789  14,791  15,059   15,059
 Cash Balance                                    3,007   11,066   3,007    3,007    3,007    3,007   3,007   4,737   6,639    6,639
                                                -------  ------- -------  -------  -------  ------- ------- ------- -------  -------
 Revolver Borrowing Capacity plus Cash           7,037   23,501  12,287   15,565   15,565   14,024  16,796  19,528  21,698   21,698

                                                 Note 1 - Revolver Borrowing Capacity is based on terms and conditions
                                                          anticipated to be in place at the Effective Date, assumed to be
                                                          December 31, 2003.
                                                 Note 2 - No receipts have been forecasted from the Ruud Notes,
                                                          Hexagram or Fiberstars stock. To the extent any proceeds are
                                                          realized, they would have a positive effect on availability.
                                                 Note 3 - In exchange for Class 3 - Old Notes, New Notes will be
                                                          received. Pursuant to the indenture, claimholders will be
                                                          receiving interest payments captured above in the Interest Expense
                                                          above the Free Cash Flow








Advanced Lighting Technologies, Inc.
Projected Free Cash Flow
Dollars in Thousands

                                                                                               
                                                 1Q-06   2Q-06   3Q-06   4Q-06     2006   1Q-07   2Q-07   3Q-07    4Q-07     2007
                                                 -----   -----   -----   -----     ----   -----   -----   -----    -----     ----

 Recurring EBITDA                                7,718   7,855   8,478   8,097   32,148   8,984   9,194   9,991    9,666   37,835
Less:  Capex                                    (1,874) (1,874) (1,874) (1,874)  (7,494) (2,151) (2,151) (2,151)  (2,151)  (8,602)
Less:  Cash Taxes                                    -       -       -    (972)    (972)      -       -       -   (2,273)  (2,273)
Change in Working Capital - Source/(Use)
   Receivables - Net                            (1,510) (3,053)  2,143  (1,405)  (3,825) (1,716) (3,336)  1,929   (1,549)  (4,672)
   Inventory                                    (1,241)    (78)    (84)    (32)  (1,435) (1,167)   (101)   (110)     (41)  (1,419)
   Post-Petition Payables                          614    (301)    624     102    1,039     725    (270)    736      114    1,306
   Prepaid Expenses                                (49)     70    (106)     16      (69)    (53)     75    (119)      18      (79)
   Accrued Expenses                                611       -       -       -      611     750       -       -        -      750
   Interest Expense                             (5,076)   (496) (5,065)   (485) (11,121) (5,053)   (473) (5,042)    (462) (11,030)
                                                ------- ------- ------- ------- -------- ------- ------- ------- -------- --------
Free Cash Flow                                    (806)  2,124   4,115   3,448    8,881     320   2,939   5,236    3,321   11,816

 Classified Claims
 Class 1(a) - Miscellaneous Secured Claims         (19)    (19)    (19)    (19)     (75)    (18)    (18)    (18)     (18)     (72)
 Class 1(b) - Secured Claims of GE                   -       -       -       -        -       -       -       -        -        -
 Class 2 - Classified Priority Claims                -       -       -       -        -       -       -       -        -        -
 Class 3 - Old Notes                                 -       -       -       -        -       -       -       -        -        -
 Class 4 - ADLT General Unsecured                    -       -       -       -        -       -       -       -        -        -
 Class 5 - Subsidiary Debtor General Unsecured       -       -       -       -        -       -       -       -        -        -
 Class 6 - Old Preferred Stock Interests             -       -       -       -        -       -       -       -        -        -
 Class 7 - Old Common Stock Interests                -       -       -       -        -       -       -       -        -        -
 Class 8 - Old Other Interests                       -       -       -       -        -       -       -       -        -        -
 Class 9 - Subsidiary Interests                      -       -       -       -        -       -       -       -        -        -
                                                ------- ------- ------- ------- -------- ------- ------- ------- -------- --------
 Total Claims                                      (19)    (19)    (19)    (19)     (75)    (18)    (18)    (18)     (18)     (72)

 Net Cash Flow                                    (826)  2,105   4,097   3,429    8,806     301   2,921   5,218    3,304   11,744

 Revolver Borrowing Capacity                    15,924  16,734  16,205  16,507   16,507  17,511  18,414  17,964   18,310   18,310
 Cash Balance                                    4,514   6,319  10,139  12,701   12,701  12,742  15,405  20,393   22,882   22,882
                                                ------- ------- ------- ------- -------- ------- ------- ------- -------- --------
 Revolver Borrowing Capacity plus Cash          20,438  23,054  26,344  29,208   29,208  30,252  33,819  38,358   41,192   41,192





                                                                        
                                                 1Q-08    2Q-08    3Q-08    4Q-08      2008
                                                 -----    -----    -----    -----      ----

 Recurring EBITDA                               10,108   10,418   11,443   11,187    43,155
Less:  Capex                                    (2,314)  (2,314)  (2,314)  (2,314)   (9,258)
Less:  Cash Taxes                                    -        -        -   (4,149)   (4,149)
Change in Working Capital - Source/(Use)
   Receivables - Net                            (1,305)  (3,640)   1,717   (1,727)   (4,955)
   Inventory                                    (1,252)    (127)    (137)     (52)   (1,567)
   Post-Petition Payables                        1,085     (252)     832      127     1,791
   Prepaid Expenses                                (53)      81     (133)      20       (85)
   Accrued Expenses                                812        -        -       (0)      812
   Interest Expense                             (5,030)    (450)  (5,019)    (439)  (10,939)
                                                ------- -------- -------- -------- ---------
Free Cash Flow                                   2,050    3,716    6,388    2,652    14,806

 Classified Claims
 Class 1(a) - Miscellaneous Secured Claims         (18)     (17)     (17)     (17)      (69)
 Class 1(b) - Secured Claims of GE                   -        -        -        -         -
 Class 2 - Classified Priority Claims                -        -        -        -         -
 Class 3 - Old Notes                                 -        -        -        -         -
 Class 4 - ADLT General Unsecured                    -        -        -        -         -
 Class 5 - Subsidiary Debtor General Unsecured       -        -        -        -         -
 Class 6 - Old Preferred Stock Interests             -        -        -        -         -
 Class 7 - Old Common Stock Interests                -        -        -        -         -
 Class 8 - Old Other Interests                       -        -        -        -         -
 Class 9 - Subsidiary Interests                      -        -        -        -         -
                                                ------- -------- -------- -------- ---------
 Total Claims                                      (18)     (17)     (17)     (17)      (69)
 Net Cash Flow                                   2,032    3,698    6,371    2,635    14,736
 Revolver Borrowing Capacity                    19,179   20,178   19,814   20,212    20,212
 Cash Balance                                   24,710   28,212   34,420   36,309    36,309
                                                ------- -------- -------- -------- ---------
 Revolver Borrowing Capacity plus Cash          43,889   48,390   54,234   56,521    56,521








                                    Annex C
                            to Disclosure Statement
                            -----------------------

                              Liquidation Analysis
                              --------------------






                          CONFIDENTIAL AND PROPRIETARY

                      Advanced Lighting Technologies, Inc.
       -----------------------------------------------------------------
                                 8/29/03 9:37 AM

                 Consolidated Chapter 7 Liquidation Analysis1,2
                   Projected Accounts as of December 31, 2003



                                                                                             
                                                            Book Value
                                                            excluding
             Division                                       eliminations        % Recoverable  Liquidation Value
             --------                                       ------------        -------------  -----------------

APL                                                          32,794,991              21.4%         7,028,573
DSI                                                          36,022,681              5.0%          1,790,208
Canada                                                       13,092,530              16.8%         2,205,873
UK                                                           20,633,983              22.6%         4,660,081
Australia                                                    11,752,563              42.5%         4,994,986
Venture Marketing                                            31,922,115              24.3%         7,752,519
Venture Factory                                              52,313,143              6.4%          3,326,212
India Power Systems                                           8,102,431              15.6%         1,266,928
India Lighting                                               26,190,561              8.0%          2,102,179
Realty                                                        8,506,235              -5.6%          (479,534)
Corporate                                                   126,667,517              1.4%          1,783,080
Other Assets                                                  1,845,031              77.9%         1,436,468
                                                            -----------              -----        -----------
Total Proceeds3                                             369,843,781              10.2%        37,867,572

Proceeds from Liquidation
DIP Facility
Administrative Claims - Chapter 7 Expenses
Administrative Claims - Chapter 11 Expenses                  27,400,699             100.0%        27,400,699
Priority Tax Claims                                           1,136,027             100.0%         1,136,027
Class 1(a):  Miscellaneous Secured Claims                     2,500,000             100.0%         2,500,000
Class 1(b):  GE Secured Claims4                                 248,000             100.0%           248,000
Class 2: Classified Priority Claims                             508,000             100.0%           508,000
Class 5: Subsidiary Debtor                                    2,389,962             100.0%         2,389,962
           General Unsecured Claims                              23,500             100.0%            23,500
Classes 3 and 4:  Old Note Claims                             2,276,480             100.0%         2,276,480
                    and ADLT General Unsecured Claims       109,314,127              1.3%          1,384,904
Class 6:  Old Preferred Stock Interests                      25,221,123              0.0%                  -
Class 7:  Old Common Stock Interests                                  -              0.0%                  -




1    Assumes no additional expenses such as severance, shut down costs,
     environmental clean up funds, etc.
2    The debtor by debtor unconsolidated liquidation analyses are available upon
     request
3    Proceeds net of accrued expenses, post-petition accounts payable and
     secured debt at subsidiary levels
4    Accounts owed by GE to the various debtors that are being offset against
     the GE Secured Claims are included within the liquidation asset values

EX-4

                                                                      EXHIBIT 4


                         UNITED STATES BANKRUPTCY COURT
                         NORTHERN DISTRICT OF ILLINOIS
                                EASTERN DIVISION


In re:                               )     Chapter 11
                                     )
VENTURE LIGHTING                     )     Case No.03 B 05255
INTERNATIONAL, INC., et al.          )     (Jointly Administered)
                                     )
                     Debtors.        )     Honorable A. Benjamin Goldgar


                                NOTICE OF FILING
                                ----------------

TO:  SEE ATTACHED SERVICE LIST

     PLEASE TAKE NOTICE that on the 29th day of August, 2003, the undersigned
filed the attached Exhibits to First Amended Chapter 11 Plan of Reorganization
dated August 15, 2003, with the Clerk of the United States Bankruptcy Court for
the Northern District of Illinois, Eastern Division, a copy of which is
attached hereto and is hereby served upon you.

                             CERTIFICATE OF SERVICE
                             ----------------------

     I, Jerry L. Switzer, Jr., certify that I caused the Exhibits to First
Amended Chapter 11 Plan of Reorganization dated August 15, 2003 to be served
upon the parties on the attached Service List via Federal Express or Messenger
delivery (as indicated thereon) on the 29th day of August, 2003.


                                               /s/ Jerry L. Switzer, Jr.
                                               -------------------------
                                                   Jerry L. Switzer

Jeff J. Marwil (06194504)
Jerry L. Switzer, Jr. (06210229)
Peter J. Young (06278765)
JENNER & BLOCK, LLC
One IBM Plaza
Chicago, Illinois 60611
(312) 222-9350
(312) 527-0484 (Fax)





              In re: Venture Lighting International, Inc., et al.
                              Case No. 03 B 05255

                                  SERVICE LIST
                                  ------------


- -------------------------------------------------------------------------------
VIA MESSENGER                                VIA MESSENGER
Ira Bodenstein                               Securities and Exchange Commission
United States Trustee (Region 11)            Attn:    Angela D. Dodd
Attn:    Roman Sukley                        175 West Jackson Boulevard
227 West Monroe Street                       Suite 900
Suite 3350                                   Chicago, IL 60604
Chicago, IL 60606                            facsimile: (312) 353-7398
facsimile: 312-886-5794
- -------------------------------------------------------------------------------
VIA MESSENGER                                VIA FEDERAL EXPRESS
Robert Fishman                               Stroock & Stroock & Lavan LLP
Shaw, Gussis, Fishman, Glantz &              Attn:  Michael J. Sage
Wolfson, LLC                                        Kris Hansen
1144 North Fulton Street                            Victor Glaser
Suite 200                                    180 Maiden Lane
Chicago, IL 60607                            New York., NY 10038
facsimile: 312-541-0155                      facsimile: 212-806-6006
- -------------------------------------------------------------------------------
VIA MESSENGER
Michael B. Solow
Joel L. Miller
Kaye Scholer LLC
Three First National Plaza
70 West Madison Street
Suite 4100
Chicago, IL 60602
facsimile: 312-583-2360
- -------------------------------------------------------------------------------



                                       2





                                   EXHIBIT A
               To First Amended Chapter 11 Plan of Reorganization
               --------------------------------------------------

                           Management Incentive Plan
                           -------------------------




               [To be filed under separate cover at a later date]





                                   EXHIBIT B
               To First Amended Chapter 11 Plan of Reorganization


                      New ADLT Articles of Incorporation1



- ---------
     1 After the filing of the Plan on August 15, 2003, the Debtors and
Saratoga determined that due to possible adverse tax consequences, they would
not seek to reincorporate ADLT as a Delaware corporation on the Effective Date.
Accordingly, ADLT will not be required to adopt a new certificate of
incorporation under Delaware law. Additionally, the Debtors and Saratoga have
not yet determined whether ADLT will be required to adopt new, amended articles
of incorporation under Ohio law as of the Effective Date. Included in this
Exhibit B are ADLT's existing articles of incorporation. In the event that
amended articles of incorporation are required, the Debtors will file such
amended articles with the final version of the Plan on or about September 19,
2003.





                          SECOND AMENDED AND RESTATED
                           ARTICLES OF INCORPORATION
                                       OF
                      ADVANCED LIGHTING TECHNOLOGIES, INC.


     FIRST: The name of the Corporation shall be Advanced Lighting
Technologies, Inc.

     SECOND: The place in the State of Ohio where the principal office of the
Corporation is to be located is in the City of Solon in Cuyahoga County.

     THIRD: The purpose or purposes for which the Corporation is formed are to
engage in any Lawful act or activity for which corporations may be formed under
ss.ss. 1701.01 to 1701.98, inclusive, of the Ohio Revised Code.

     FOURTH: The Corporation shall be authorized to issue four million
(4,000,000) shares of common stock, par value one thousandth of one cent
($.001), and one million (1,000,000) shares of preferred stock, par value one
thousandth of one cent ($.001). Any and all shares so issued, the consideration
for which, as fixed by the incorporator or the Board of Directors, has been
paid or delivered, shall be fully paid and nonassessable. The shares of each
class shall have the following express terms:

     PART A: SERIES OF PREFERRED SHARES.

     1. Rights of Directors to Adopt Amendments in Respect of Preferred Shares.
The Board of Directors is hereby authorized to adopt amendments to this Article
FOURTH in respect of any unissued Preferred Shares (whether or not previously
designated as shares of a particular series and including Preferred Shares of
any series issued and thereafter acquired by the Corporation), to the full
extent permitted by the Ohio Revised Code, creating one or more series of
Preferred Shares and, with respect to each such series, fix or change, in whole
or in part, the express terms (within the limits set forth in Sections 1701.01
through 1701.99 of the Ohio Revised Code) of (a) any class of shares before the
issuance of any shares of that class or (b) one or more series within a class
before the issuance of any shares of that series.

     2. Preferred Shares, Generally. All shares of any series shall be
identical in all respects, except that the shares of any one series issued at
different times may differ as to the dates from which dividends or
distributions thereon shall be cumulative. Preferred Shares shall have equal
rank and priority with respect to the payment of dividends and shall be
identical in all respects except as permitted by the foregoing provision of
this Part A. Nothing contained herein shall be construed to limit or restrict
in any way the rights in respect of unissued shares of any class or series
granted to the Board of Directors by the laws of Ohio now or hereafter in
force.





     PART B: EXPRESS TERMS OF THE COMMON SHARES

     1. Subject to Preferred Shares. The Common Shares shall be subject to the
express terms of the Preferred Shares.

     2. Right to Dividends. Subject to any rights to receive dividends to which
the holders of shares of outstanding Preferred Shares, if any, may be entitled,
the holders of shares of Common Shares shall be entitled to receive dividends,
if and when declared, payable from time to time by the Board of Directors from
any funds legally available therefor.

     3. Voting. Each outstanding share of Common Shares of the Corporation
shall entitle the holder thereof to one (1) vote and, except as otherwise
stated or expressed in a resolution or resolutions adopted by the Board of
Directors providing for the issuance of any Preferred Shares or as otherwise
provided by law, the exclusive voting power for all purposes shall be vested in
the holders of the Common Shares.

     FIFTH: A. The number of Directors of the Corporation, none of whom need be
shareholders, shall be not less than three (3) nor more than ten (10).
Initially, the number of Directors of the Corporation shall be fixed at three
(3). By the majority vote of the Directors then in office, the number of
persons which shall constitute the Board of Directors for each ensuing year
shall be fixed, and may from time-to-time be increased or decreased.

          B. The Board of Directors shall be and is divided into three (3)
classes. Each Director shall serve for a term ending on the date of the third
annual meeting following the annual meeting at which such Director was elected;
provided, however, that each initial Director in Class I shall hold office
until the annual meeting of shareholders in 1996, and each initial Director in
Class II shall hold office until the annual meeting of shareholders in 1997.
Elections of Directors need not be by ballot unless the Regulations so provide.
No reduction in the number of Directors of any class shall have the effect of
removing any Director of any class prior to the expiration of his term of
office.

          C. In the event of any increase or decrease in the authorized number
of Directors: (i) each Director then serving as such shall nevertheless
continue as a Director of the class of which he or she is a member until the
expiration of his or her current term, or his or her prior death, retirement,
resignation, or removal; and (ii) the newly created or eliminated directorships
resulting from such increase or decrease shall be apportioned by the Board of
Directors among the three (3) classes of Directors as to maintain such classes
as nearly equal as possible.

          D. Notwithstanding any of the foregoing provisions of this Article
FIFTH, each Director shall serve until his or her successor is elected and
qualified or until his or her death, retirement, resignation or removal. Should
a


                                      -2-



vacancy occur or be created, whether arising through death, resignation or
removal of a Director or through an increase in the number of Directors of any
class, such vacancy shall be filled by action of a majority of the Directors in
office. A Director so elected to fill a vacancy shall serve for the remainder
of the then present term of office of the class to which he or she was elected.

          E. Shareholders may remove directors of the Corporation only for
cause. "Cause" for the removal of a Director by the shareholders shall exist
only upon the occurrence of one (1) of the following events: (1) the conviction
of the Director of a felony; or (2) a finding by a court of law that the
Director has been or is guilty of negligence or misconduct in the performance
of his duties as a Director of the Corporation. A majority of the Directors may
remove a Director with or without cause.

          F. Nominations for the election of Directors shall be made in
accordance with the Regulations.

          G. Wherever the term "Board of Directors" is used in these Articles
of Incorporation, such term shall mean the Board of Directors of the
Corporation; provided, however, that, to the extent any committee of directors
of the Corporation is lawfully entitled to exercise the powers of the Board of
Directors, such committee, to the extent provided by resolution of the Board of
Directors or the Regulations, may exercise any power or authority of the Board
of Directors under the Articles of Incorporation in the management of the
business and affairs of the Corporation (including, without limitation, the
declaration of a dividend or the authorization of the issuance of any shares of
Common Shares or Preferred Shares) other than the authority of filling
vacancies in the Board of Directors or in any committee thereof.

     SIXTH: No holder of shares of any class shall be entitled as such to
subscribe for or purchase shares of any class now or hereafter authorized, or
securities convertible into or exchangeable for such shares, or securities to
which there are attached or appertained any warrants or rights entitling the
holder thereof to subscribe for or purchase such shares.

     SEVENTH: The Corporation may purchase from time to time shares of any
class issued by it, upon agreement with the holder thereof. Such purchases may
be made either in the open market or at private or public sale, in such manner
and amount, from the holder or holders of outstanding shares of the
Corporation, and at such prices and upon such terms as the Board of Directors
shall, from time to time, determine. Unless a different procedure is
established in a written agreement among the Corporation and all of the
shareholders of the Corporation, the Board of Directors is hereby empowered to
authorize such purchases from time to time without any vote of the holders of
any class of shares authorized and outstanding at the time of any such
purchases.


                                      -3-



     EIGHTH: A Director of the Corporation shall not be disqualified by his
office from dealing or contracting with the Corporation either as a seller,
purchaser or otherwise, nor shall any contract, or transaction be void or
voidable with respect to the Corporation for the reason that it is between the
Corporation and one or more of its Directors or officers, or between the
Corporation and any other person in which one or more of its Directors or any
officers are directors, trustees, or officers, or have a financial or personal
interest, or for the reason that one or more interested Directors or officers
participate in or vote at the meeting of the Directors or a committee thereof
which authorizes such contract or transaction, if in any such case (a) the
material facts as to his or their relationship or interests and as to the
contract or transaction are disclosed or are known to the Directors or the
committee and the Directors or committee, in good faith reasonably justified by
such facts, authorize the contract or transaction by the affirmative vote of a
majority of the disinterested Directors, even though the disinterested
Directors constitute less than a quorum; or (b) the material facts as to his or
their relationship or interest and as to the contract or transaction are
disclosed or are known to the shareholders entitled to vote thereon and the
contract or transaction is specifically approved at a meeting of the
shareholders held for such purpose by the affirmative vote of the holders of
shares entitling them to exercise a majority of the voting power of the
Corporation held by persons not interested in the contract or transaction; or
(c) the contract or transaction is fair as to the Corporation as of the time it
is authorized or approved by the Directors, a committee thereof, or the
shareholders. Common or interested Directors may be counted in determining the
presence of a quorum at a meeting of the Directors, or a committee thereof
which authorizes the contract or transaction.

     NINTH: The Court of Common Pleas of the county in which this Corporation
maintains its principal office is hereby authorized to order the appointment of
a provisional Director for this Corporation, in accordance with the provisions
of ss.ss. 1701.56 and 1701.911 of the Ohio Revised Code.

     TENTH: No holder of shares of the Corporation shall have the right to
cumulate the vote of such shares in the election of Directors.

     ELEVENTH: Whenever, under the laws of the State of Ohio, now or hereafter
in effect, action is authorized or required to be taken by the vote or consent
of the holders of shares entitling them to exercise two-thirds of the voting
power of the Corporation or of any class or classes of shares thereof, such
action shall be effected by the vote, consent or authorization of the holders
of shares entitling them to exercise a majority of such voting power, unless a
greater proportion of votes is made mandatory for such particular action by the
laws of the State of Ohio.


                                      -4-



                            CERTIFICATE OF ADOPTION
                                       OF
                       AMENDED ARTICLES OF INCORPORATION
                                       OF
                      ADVANCED LIGHTING TECHNOLOGIES, INC.

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

     Wayne R. Hellman and Louis S. Fisi, President and Secretary, respectively,
of ADVANCED LIGHTING TECHNOLOGIES, INC., an Ohio corporation, having its
principal office in the City of Solon, Ohio, do hereby certify that on the 13th
day of November, 1996, pursuant to the authority of Ohio Revised Code Section
1701.71, a majority of the holders of the issued and outstanding shares of said
Corporation entitled to vote did, at a meeting of the shareholders, unanimously
approve the following action and adopt the following resolution amending the
existing Articles of Incorporation:

     RESOLVED, that the first sentence of Article Fourth of the Second Amended
     and Restated Articles of Incorporation of ADVANCED LIGHTING TECHNOLOGIES,
     INC. is hereby amended as follows:

     FOURTH: The Corporation shall be authorized to issue eighty million
     (80,000,000) shares of common stock, par value one thousandth of one cent
     ($.001), and one million (1,000,000) shares of preferred stock, par value
     one thousandth of one cent ($.001).

     IN WITNESS WHEREOF, Wayne R. Hellman and Louis S. Fisi, President and
Secretary, respectively, acting for and on behalf of said Corporation, have
hereunto subscribed their names this 10th day of February, 1997.


                                               /s/ Wayne R. Hellman
                                               ---------------------------------
                                               Wayne R. Hellman, President



                                               /s/ Louis S. Fisi
                                               ---------------------------------
                                               Louis S. Fisi, Secretary





                          CERTIFICATE OF AMENDMENT TO
                              AMENDED AND RESTATED
                          ARTICLES OF INCORPORATION OF
                      ADVANCED LIGHTING TECHNOLOGIES, INC.

     Louis S. Fisi, Executive Vice President/Secretary of ADVANCED LIGHTING
TECHNOLOGIES, INC., an Ohio corporation (the "Corporation"), having its
principal office in the City of Solon, Ohio, does hereby certify that on the 28
day of September, 1999, pursuant to the authority of Ohio Revised Code Section
1701.70(B)(1), Article Four of the Second Amended and Restated Articles of
Incorporation of the Corporation and the Code of Regulations of the
Corporation, the directors of said Corporation did unanimously approve by
unanimous written consent the following action and adopt the following
resolution amending the existing Articles of Incorporation:

Amendment to Second Amended and Restated Articles of Incorporation Relating to
Express Terms of Series A Convertible Preferred Shares

     RESOLVED, that, pursuant to Section 1701.70(B)(1) of the Ohio Revised Code
and Article Four of the Second Amended and Restated Articles of Incorporation
of Advanced Lighting Technologies, Inc. (the "Corporation"), effective on the
date of filing of a certified copy of this resolution with the Secretary of
State of the State of Ohio, such Article Four is hereby amended to include
Paragraph 3 to Part A to fix the express terms of the Corporation's Series A
Preferred Shares, which paragraph 3 is attached to these Resolutions as Exhibit
A, and such amendment shall, and does hereby, amend such Second Amended and
Restated Articles of Incorporation effective on such date.

     IN WITNESS WHEREOF, Louis S. Fisi, Executive Vice President and Secretary,
acting for and on behalf of said Corporation, has hereunto subscribed his name
this 29 day of September, 1999.


                                           /s/ Louis S. Fisi
                                           -------------------------------------
                                           Louis S. Fisi, Executive Vice
                                           President/Secretary


                                     Page 1



                                   EXHIBIT A


3. Series A Convertible Preferred Shares.

I. Definitions. For purposes of this Paragraph 3 of this Part A of this Article
Fourth, the following terms shall have the following meanings:

     (a) "Additional Common Shares" shall mean Common Shares issued by the
Corporation after the Effective Date.

     (b) "Additional Issuance" shall have the meaning ascribed to such term in
Subsection V(c)(iii)(A) hereof.

     (c) "Appraised Value" shall mean, in respect of any Common Share on any
date herein specified, the fair saleable value of such Common Share (determined
without giving affect to the discount for (i) a minority interest or (ii) any
lack of liquidity of the Common Share or (iii) the fact that the Corporation
may have no class of equity registered under the Exchange Act) based on the
equity value of the Corporation, as determined by an investment banking or
valuation firm selected in accordance with the following sentences, divided by
the number of Common Shares outstanding on a Fully Diluted Basis as determined
in accordance with GAAP (assuming the payment of the exercise prices for such
shares). The determination of the Appraised Value per Common Share shall be
made by an investment banking or valuation firm of nationally recognized
standing selected by the Corporation and acceptable to the Majority Holders. If
the investment banking or valuation firm selected by the Corporation is not
acceptable to the Majority Holders and the Corporation and the Majority Holders
cannot agree on a mutually acceptable investment banking or valuation firm,
then the Majority Holders and the Corporation shall each choose one such
investment banking or valuation firm and the respective chosen firms shall
agree on another investment banking or valuation firm which shall make the
determination. The Corporation shall retain, at its sole cost, such investment
banking or valuation firm, as may be necessary for the determination of
Appraised Value required by the terms of these Third Amended and Restated
Articles of Incorporation.

     (d) "Business Day" shall mean any day that is not a Saturday or Sunday or
a day on which banks are required to be closed in the State of New York.

     (e) "Closing Period" shall have the meaning ascribed to such term in
Subsection VII(f) hereof.


                                    Page 2



     (f) "Common Shares" shall mean the Common Shares, par value one thousandth
of one cent ($.001), of the Corporation.

     (g) "Contingent Shares" shall mean the Common Shares issued upon exercise
of the Contingent Warrants.

     (h) "Contingent Warrant Agreement" shall mean the Contingent Warrant
Agreement, dated the Effective Date, among the Original Purchaser, the
Corporation, Hellman, Ltd., Wayne R. Hellman, Wayne R. Hellman, as voting
trustee under Voting Trust Agreement dated October 10, 1995, Alan J. Ruud and
Alan J. Ruud, as voting trustee under Voting Trust Agreement dated January 2,
1998.

     (i) "Contingent Warrants" shall mean the First Contingent Warrant and the
Second Contingent Warrant issued under the Contingent Warrant Agreement, dated
as of the Effective Date, between the Corporation and the Original Purchaser.

     (j) "Control Share Acquisition Resolution" shall mean the resolution to be
voted upon by the shareholders of the Corporation at the Corporation's 1999
annual meeting to amend the Corporation's Articles of Incorporation to provide
that Section 1701.831 of the Ohio Revised Code shall not apply to "control
share acquisitions" (as defined in Section 1701.01 of the Ohio Revised Code) of
shares of capital stock of the Corporation.

     (k) "Conversion Ratio" shall have the meaning ascribed to such term in
Subsection V(a) hereof.

     (1) "Conversion Shares" shall mean the Common Shares to be issued upon the
conversion of Series A Preferred Shares.

     (m) "Convertible Securities" shall mean evidences of indebtedness, shares
of capital stock or other securities that are convertible into or exchangeable,
with or without payment of additional consideration in cash or property, for
Additional Common Shares, either immediately or upon the occurrence of a
specified date or a specified event.

     (n) "Corporation Put Right Notice" shall have the meaning ascribed to such
term in Subsection VII(e) hereof.

     (o) "Credit Agreements" shall have the meaning ascribed to such term in
Subsection VII(f) hereof.

     (p) "Current Market Price" shall mean, in respect of any Common Share on
any date herein specified, if there shall then be a public market for the


                                    Page 3



Common Shares, the average of the daily market prices for 20 consecutive
Business Days immediately preceding such date or, if there is no such public
market, the Appraised Value per Common Share. The daily market price for each
such Business Day shall be (i) the last sale price on such day on the principal
stock exchange or NASDAQ-NMS on which such Common Shares are then listed or
admitted to trading, or (ii) if no sale takes place on such day on any such
exchange or NASDAQ-NMS, the average of the last reported closing bid and asked
prices on such day as officially quoted on any such exchange or NASDAQ-NMS, or
(iii) if the Common Shares are not then listed or admitted to trading on any
stock exchange or NASDAQ-NMS, the average of the last reported closing bid and
asked prices on such day in the over-the-counter market, as furnished by the
NASDAQ or the National Quotation Bureau, Inc., or (iv) if neither such
corporation at the time is engaged in the business of reporting such prices, as
furnished by any similar firm then engaged in such business, or (v) if there is
no such firm, as furnished by any member of the NASD selected mutually by the
Majority Holders and the Corporation or, if they cannot agree upon such
selection, as selected by two such members of the NASD, one of which shall be
selected by the Majority Holders and one of which shall be selected by the
Corporation.

     (q) "Effective Date" shall mean the date on which the Amendment to these
Articles of Incorporation designating the Series A Preferred Shares became
effective.

     (r) "Fully Diluted Basis" means, with respect to any determination or
calculation, that such determination or calculation is performed on a fully
diluted basis (assuming the issuance of all Common Shares issuable under any
then outstanding options, warrants or convertible securities of any kind)
determined in accordance with GAAP for purposes of determining book value or
net income per share.

     (s) "Governmental Approval" shall have the meaning ascribed to such term
in Subsection VII(c) hereof.

     (t) "Indebtedness for Borrowed Money" shall mean as to any Person, at a
particular time, all items which constitute, without duplication (a)
indebtedness for borrowed money, (b) indebtedness in respect of the deferred
purchase price of property, (c) indebtedness evidenced by notes, bonds,
debentures or similar instruments, (d) capital lease obligations (i.e.,
obligations with respect to leases which are required to be capitalized for
financial reporting purposes in accordance with GAAP), (e) all obligations of
such Person in respect of capital stock subject to mandatory redemption or
redemption at the option of the holder thereof, in whole or in part, and (f)
all contingent obligations of such Person in respect of any of the foregoing.
As to the Corporation and any


                                    Page 4



Subsidiary, the term Indebtedness for Borrowed Money shall not include
indebtedness to the Corporation from any Subsidiary, indebtedness to any
Subsidiary from the Corporation or indebtedness to any Subsidiary from any
Subsidiary.

     (u) "Liquidation Preference Amount" shall have the meaning ascribed to
such term in Subsection III(a) hereof.

     (v) "Majority Holders" shall mean the holders of Series A Preferred Shares
convertible into more than 50% of the aggregate number of Conversion Shares
then issuable upon conversion of all then outstanding Series A Preferred
Shares.

     (w) "NASDAQ Approval" shall mean approval of the transactions contemplated
by the Stock Purchase Agreement by the shareholders of the Corporation pursuant
to NASDAQ Rule 4460(i)(D).

     (x) "Original Purchaser" shall mean General Electric Company, a New York
corporation.

     (y) "Other Property" shall have the meaning ascribed to such term in
Subsection V(c)(viii) hereof.

     (z) "Permitted Issuances" shall mean (i) the issuance or conversion of
options issued pursuant to any stock option plan, employee incentive plan,
employee stock purchase plan or employee retirement and savings plan approved
by the Corporation's Board of Directors, (ii) the issuance of Conversion
Shares, Contingent Shares or Warrant Shares, and (iii) the issuance of Common
Shares to satisfy obligations in respect of acquisitions of securities or
assets of any Person, provided (A) such contracts were entered into prior to
September 30, 1999, and (B) the number of Common Shares subject to this
subclause (iii) shall not exceed 110,000 in the aggregate.

     (aa) "Person" shall mean any natural person, corporation, firm,
partnership. association, government, governmental agency or other entity,
whether acting in an individual, fiduciary or other capacity.

     (bb) "Preferred Shares" shall mean the Series A Preferred Shares and the
shares of any other series of Preferred Shares created in accordance with these
Articles of Incorporation.

     (cc) "Purchase Price" shall mean $6.75 per Common Share (as the same may
be adjusted from time to time to take into account any action by the
Corporation in respect of its Common Shares, including, without limitation,
stock splits, dividends, combinations and reclassifications).


                                    Page 5



     (dd) "Put Option" shall have the meaning ascribed to such term in
Subsection VII(h) hereof.

     (ee) "Put Option Date" shall have the meaning ascribed to such term in
Subsection VII(h) hereof.

     (ff) "Put Option Notice" shall have the meaning ascribed to such term in
Subsection VII(h) hereof.

     (gg) "Put Option Purchase Price" shall have the meaning ascribed to such
term in Subsection VII(h) hereof.

     (hh) "Put Shares" shall have the meaning ascribed to such term in
Subsection VII(h) hereof.

     (ii) "Redemption Date" shall have the meaning ascribed to such term in
Subsection VI(a) hereof.

     (jj) "Redemption Notice" shall have the meaning ascribed to such term in
Subsection VI(c) hereof.

     (kk) "Redemption Price" shall have the meaning ascribed to such term in
Subsection VI(a) hereof.

     (ll) "Second Occurrence Failure" shall have the meaning ascribed thereto
in the Contingent Warrant Agreement.

     (mm) "Series A Preferred Shares" shall mean the Series A Convertible
Preferred Shares, par value one thousandth of one cent ($.001), of the
Corporation.

     (nn) "Stock Purchase Agreement" shall mean the Stock Purchase Agreement
dated September 28, 1999, between Advanced Lighting Technologies, Inc., an Ohio
corporation, and the Original Purchaser.

     (oo) "Stock Plans" shall mean the Corporation's 1995 Incentive Award Plan,
the Corporation's Billion Dollar Market Capitalization Incentive Award Plan,
the Corporation's 1998 Incentive Award Plan, the Corporation's Employee Stock
Purchase Plan and the Corporation's 401(k) Retirement and Savings Plan.

     (pp) "Subsequent Closing Period" shall have the meaning ascribed to such
term in Subsection VII(f) hereof.

     (qq) "Subsidiaries" shall mean any other corporations of which more than
50% of the outstanding shares of capital stock having ordinary voting power for
the election of directors is owned directly or indirectly by the Corporation,
by


                                    Page 6



the Corporation and one or more Subsidiaries, or by one or more other
Subsidiaries.

     (rr) "Warrant" shall mean the warrant in the form of Exhibit 1 attached to
the Stock Purchase Agreement for the right to purchase additional Common
Shares.

     (ss) "Warrant Shares" shall mean Common Shares to be issued upon exercise
of the Warrant.

II. Dividends. No dividends shall be declared and set aside for any Series A
Preferred Shares of the Corporation except in the event that the Board of
Directors of the Corporation shall declare a dividend payable upon the then
outstanding Common Shares of the Corporation, in which event the holders of the
Series A Preferred Shares shall be entitled to the amount of dividends per
share as would be declared payable on the number of Common Shares into which
each Series A Preferred Share held by each holder thereof could be converted
pursuant to the provisions of Subsection V hereof, such number determined as of
the record date for the determination of holders of Common Shares entitled to
receive such dividend.

III. Liquidation, Dissolution or Winding Up.

     (a) Treatment at Liquidation, Dissolution or Winding Up. Upon any
liquidation. dissolution or winding up of the Corporation, whether voluntary or
involuntary, the holders of Series A Preferred Shares shall be entitled to
receive, prior and in preference to any distribution of any of the assets or
surplus funds of the Corporation to the holders of the Common Shares by reason
of their ownership thereof, the amount of $27.00 per Series A Preferred Share
(as adjusted for any stock dividends, combinations or splits with respect to
such shares), plus interest thereon calculated at a rate per annum equal to 8%
compounded annually from the date of issuance of each Series A Preferred Share
until the date of payment (the "Liquidation Preference Amount"). Interest shall
be determined on the basis of a 365 day year for the actual number of days
elapsed from the date of issuance until the date of payment. If upon the
occurrence of any liquidation, dissolution or winding up, the assets and
surplus funds required to be distributed among the Series A Preferred Shares
shall be insufficient to permit the payment to such holders of the full
preferential amount, then the entire assets and surplus funds of the
Corporation legally available for distribution shall be distributed among the
holders of the Series A Preferred Shares so that all holders of Series A
Preferred Shares shall receive an amount per share pro rata in accordance with
the preferential amount payable with respect to each Series A Preferred Share.
After payment to the holders of the Series A Preferred Shares of the amounts
set forth above, the entire remaining assets and funds of the Corporation
legally available


                                    Page 7



for distribution, if any, shall be distributed among the holders of the Common
Shares in proportion to the Common Shares then held by them; provided, however,
that the holders of Series A Preferred Shares shall be entitled by reason of
their ownership thereof to participate in any such distribution of any
remaining assets or surplus funds to the holders of the Common Shares as if the
holders of the Series A Preferred Shares converted such securities into Common
Shares at the Conversion Ratio set forth in Subsection V below (as adjusted as
set forth herein) immediately prior to the date of such event in addition to
receipt of the amounts to which they are entitled on account of their ownership
of the Series A Preferred Shares as set forth above.

     (b) Treatment of Reorganizations, Consolidations, Mergers, and Sales of
Assets. For purposes of this Section III, any acquisition of the Corporation by
means of (i) consolidation, merger or other form of corporate reorganization in
which outstanding shares of the Corporation are exchanged for securities or
other consideration issued, or caused to be issued, by the acquiring
corporation or its subsidiary, or (ii) a sale of all or substantially all of
the assets of the Corporation, shall be treated as a liquidation, dissolution
or winding up of the Corporation and the holders of the Series A Preferred
Shares, at their option, shall have the right to receive, in lieu of the
preferential distributions described in this Section III, at the closing, the
same consideration per share payable to holders of the Common Shares as if the
holders of the Series A Preferred Shares converted such securities into Common
Shares at the Conversion Ratio set forth in Section V below (as adjusted as set
forth herein) immediately prior to the closing of such transaction.

     (c) Distributions Other than Cash. Whenever a distribution provided for in
this Section III shall be payable in securities or property other than cash,
the value of such distribution shall be the fair market value of such
securities or other property as determined in good faith by the Board of
Directors.

IV. Voting.

     (a) General. In addition to special voting rights provided by applicable
law, each holder of Series A Preferred Shares shall be entitled to vote on all
matters and shall be entitled to cast four (4) votes for each Series A
Preferred Share held at the record date for the determination of shareholders
entitled to vote on such matter or, if no record date is established. at the
date such vote is taken or any written consent of shareholders is first
executed, such votes to be counted together with all other shares of capital
stock having general voting powers and not separately as a class.
Notwithstanding any adjustment to the Conversion Ratio (as defined in Section
V) pursuant to Section V, Section VI or Section VII hereof, no holder of Series
A Preferred Shares shall at any time be entitled to cast more than four (4)
votes for each Series A Preferred Share held by such holder. In all cases where
the holders of Series A Preferred Shares have the right to vote


                                    Page 8



separately as a class, such holders shall be entitled to one vote for each such
share held by them.

     (b) Special Meetings. The holders of at least a majority of the aggregate
number of Series A Preferred Shares then outstanding (evidenced in writing by
such holders or by vote at a meeting of shareholders called for such purpose)
shall have the right at any time to call for a special meeting of the Board of
Directors of the Corporation for such specified purposes as such holders may
deem desirable. Such special meeting shall be convened in accordance with the
applicable notice provisions of the Corporation's Code of Regulations.

V. Conversion. The holders of Series A Preferred Shares shall have conversion
rights as follows:

     (a) Optional Conversion; Fractional Shares. Each issued and outstanding
Series A Preferred Share shall be convertible, at the option of the holder
thereof, at any time and from time to time without the payment of additional
consideration, at the office of the Corporation or any transfer agent for such
stock, into 4 fully paid and nonassessable Common Shares (the "Conversion
Ratio"). The Corporation shall not be required to issue a fractional Common
Share upon conversion of any Series A Preferred Share. If any fraction of a
share would, but for this provision, be issuable upon conversion of a Series A
Preferred Share, in lieu of such fractional share, the Corporation may, at its
option, pay a cash adjustment in respect of such final fraction in an amount
equal to the same fraction of the Current Market Price per Common Share on the
date of conversion.

     (b) Reservation of Common Shares. The Corporation shall at all times
reserve and keep available out of its authorized but unissued Common Shares,
solely for the purpose of issuance upon the conversion of the Series A
Preferred Shares, such number of Common Shares issuable upon the conversion of
all outstanding Series A Preferred Shares. All Common Shares which are so
issuable shall, when issued, be duly and validly issued, fully paid and
nonassessable and free from all taxes, liens and charges. The Corporation shall
take all such actions as may be necessary to assure that all such Common Shares
may be so issued without violation of any applicable law or governmental
regulation or any requirements of any domestic securities exchange upon which
Common Shares may be listed (except for official notice of issuance which shall
be immediately delivered by the Corporation upon each such issuance).

     (c) Adjustments. Subject to NASDAQ Approval, the following adjustments
shall apply as set forth in this Section V. The Corporation shall give each
holder of Preferred Shares notice of any event described below in accordance
with Section V(d) below.


                                    Page 9



     (i) Share Dividends, Subdivisions and Combinations. If at any time the
Corporation shall:

          (A) take a record of the holders of its Common Shares for the purpose
     of entitling them to receive a dividend payable in, or other distribution
     of, Additional Common Shares,

          (B) subdivide its outstanding Common Shares into a larger number of
     Common Shares, or

          (C) combine its outstanding Common Shares into a smaller number of
     Common Shares,

then, the Conversion Ratio shall be adjusted such that the number of Common
Shares into which each Series A Preferred Share is convertible immediately
after the occurrence of any such event shall be adjusted to equal the number of
Common Shares that a record holder of the same number of Common Shares into
which a Series A Preferred Share is convertible immediately prior to the
occurrence of such event would own or be entitled to receive after the
happening of such event.

     (ii) Certain Other Distributions and Adjustments.

          (A) If at any time the Corporation shall take a record of the holders
     of its Common Shares for the purpose of entitling them to receive any
     dividend or other distribution of:

               (1) cash,

               (2) any evidences of its indebtedness, any shares of its stock
          or any other securities or property of any nature whatsoever (other
          than cash, Convertible Securities or Additional Common Shares), or

               (3) any warrants or other rights to subscribe for or purchase
          any evidences of its indebtedness, any shares of its stock or any
          other securities or property of any nature whatsoever (other than
          cash, Convertible Securities or Additional Common Shares),

then, the holders of Series A Preferred Shares shall be entitled to receive
such dividend or distribution as if such holder had converted such Series A
Preferred Shares into Common Shares.

          (B) A reclassification of the Common Shares (other than a change in
     par value, or from par value to no par value or from no par value


                                    Page 10



     to par value) into Common Shares and shares of any other class of stock
     shall be deemed a distribution by the Corporation to the holders of its
     Common Shares of such shares of such other class of stock within the
     meaning of Subsection (c)(ii)(A) above and, if the outstanding Common
     Shares shall be changed into a larger or smaller number of Common Shares
     as a part of such reclassification, such change shall be deemed a
     subdivision or combination, as the case may be, of the outstanding Common
     Shares within the meaning of Subsection (c)(i) hereof.

     (iii) Issuance of Additional Common Shares.

          (A) If at any time the Corporation shall (except as hereinafter
     provided) issue or sell any Additional Common Shares (an "Additional
     Issuance"), other than Permitted Issuances, in exchange for consideration
     in an amount per Additional Common Share less than either the Purchase
     Price or the Current Market Price on the date of such Additional Issuance
     (before giving effect to such Additional Issuance) then, effective at the
     time of such Additional Issuance, the number of Common Shares which will
     be issued upon conversion of the Series A Preferred Shares shall be
     increased to a number determined by multiplying the number of Common
     Shares subject to issuance upon conversion of the Series A Preferred
     Shares immediately before such Additional Issuance by a fraction, the
     numerator of which shall be the number of Common Shares immediately after
     giving effect to such Additional Issuance (calculated on a Fully Diluted
     Basis) and the denominator of which shall be the sum of:

               (1) the number of Common Shares outstanding immediately before
          giving effect to such Additional Issuance (calculated on a Fully
          Diluted Basis), plus

               (2) the number of Common Shares that the aggregate consideration
          received by the Corporation with respect to such Additional Issuance
          would purchase at the "Calculation Price" on the date of such
          Additional Issuance (before giving effect to such Additional
          Issuance).

For purposes of the preceding calculation, the term "Calculation Price" shall
mean (a) the Purchase Price if the consideration received per Additional Common
Share is less than the Purchase Price but greater than the Current Market
Price, (b) the Current Market Price if the consideration received per
Additional Common Share is less than the Current Market Price but greater than
the Purchase Price and (c) the greater of the Purchase Price and the Current
Market Price if the consideration received per Additional Common Share is less
than both the Purchase Price and the Current Market Price.


                                    Page 11



In computing adjustments under this Subsection, fractional interests in Common
Shares shall be taken into account to the nearest one-thousandth of a share.

          (B) Subsection (c)(iii)(A) shall not apply to any issuance of
     Additional Common Shares for which an adjustment is provided under
     Subsections (c)(i) and (c)(ii). No adjustment of the number of Common
     Shares into which the Series A Preferred Shares are convertible shall be
     made under Subsection (c)(iii)(A) upon the issuance of any Additional
     Common Shares that are issued pursuant to the exercise of any warrants or
     other subscription or purchase rights or pursuant to the exercise of any
     conversion or exchange rights in any Convertible Securities, if any such
     adjustment shall previously have been made upon the issuance of such
     warrants or other rights or upon the issuance of such Convertible
     Securities (or upon the issuance of any warrant or other rights therefor)
     pursuant to Subsections (c)(iv) and (c)(v).

     (iv) Issuance of Warrants or Other Rights. If at any time the Corporation
shall take a record of the holders of its Common Shares for the purpose of
entitling them to receive a distribution of, or shall in any manner (whether
directly or by assumption in a merger in which the Corporation is the surviving
corporation) issue or sell, any warrants or other rights to subscribe for or
purchase any Additional Common Shares or any Convertible Securities, whether or
not the rights to exchange or convert thereunder are immediately exercisable,
and the price per share for which a Common Share is issuable upon the exercise
of such warrants or other rights or upon conversion or exchange of such
Convertible Securities shall be less than either the Purchase Price or the
Current Market Price on the date of such issue or sale, then the number of
Common Shares which will be issued upon conversion of the Series A Preferred
Shares shall be adjusted as provided in Subsection (c)(iii)(A) on the basis
that the maximum number of Additional Common Shares issuable pursuant to all
such warrants or other rights necessary to effect the conversion or exchange of
all such Convertible Securities shall be deemed to have been issued and
outstanding and the Corporation shall be deemed to have received all of the
consideration payable therefor, if any, as of the date of the issuance of such
warrants or other rights. No further adjustments to the number of Common Shares
which will be issued upon conversion of the Series A Preferred Shares shall be
made upon the actual issue of Common Shares or of Convertible Securities upon
exercise of warrants or other rights contemplated by this Subsection (c)(iv) or
upon the actual issue of Common Shares upon conversion or exchange of
Convertible Securities contemplated by this Subsection (c)(iv).

     (v) Issuance of Convertible Securities. If at any time the Corporation
shall take a record of the holders of its Common Shares for the purpose of
entitling them to receive a distribution of, or shall in any manner (whether
directly


                                    Page 12



or by assumption in a merger in which the Corporation is the surviving
corporation) issue or sell, any Convertible Securities, whether or not the
rights to exchange or convert thereunder are immediately exercisable, and the
price per share for which a Common Share is issuable upon such conversion or
exchange shall be less than either the Purchase Price or the Current Market
Price on the date of such issue or sale, then the number of Common Shares which
will be issued upon conversion of the Series A Preferred Shares shall be
adjusted as provided in Subsection (c)(iii)(A) on the basis that the maximum
number of Additional Common Shares necessary to effect the conversion or
exchange of all such Convertible Securities shall be deemed to have been issued
and outstanding and the Corporation shall have received all of the
consideration payable therefor, if any, as of the date of issuance of such
Convertible Securities. No adjustment to the number of Common Shares into which
the Series A Preferred Shares are convertible shall be made under this
Subsection (c)(v) upon the issuance of any Convertible Securities that are
issued pursuant to the exercise of any warrants or other subscription or
purchase rights therefor, if any such adjustment shall previously have been
made upon the issuance of such warrants or other rights pursuant to Subsection
(c)(iv). No further adjustments of the number of Common Shares into which the
Series A Preferred Shares are convertible shall be made upon the actual issue
of such Common Shares upon conversion or exchange of such Convertible
Securities and, if any issue or sale of such Convertible Securities is made
upon exercise of any warrant or other right to subscribe for or to purchase any
such Convertible Securities for which adjustments of the number of Common
Shares into which the Series A Preferred Shares are convertible have been or
are to be made pursuant to other provisions of this Subsection (c), no further
adjustments of the number of Common Shares into which the Preferred Shares are
convertible shall be made by reason of such issue or sale.

     (vi) Superseding Adjustment. If, at any time after any adjustment of the
number of Common Shares into which the Series A Preferred Shares are
convertible shall have been made pursuant to Subsections (c)(iv) and (c)(v) as
the result of any issuance of warrants, rights or Convertible Securities,

          (A) such warrants or rights, or the right of conversion or exchange
     in such other Convertible Securities, shall expire, and all or a portion
     of such warrants or rights, or the right of conversion or exchange with
     respect to all or a portion of such other Convertible Securities, as the
     case may be, shall not have been exercised, or

          (B) the consideration per share for which Common Shares are issuable
     pursuant to such warrants or rights, or the terms of such other
     Convertible Securities, shall be increased solely by virtue of provisions
     therein contained for an automatic increase in such consideration per
     share upon the occurrence of a specified date or event,


                                    Page 13



then the previous adjustment made to the number of Common Shares into which the
Preferred Shares are convertible shall be rescinded and annulled and the
Additional Common Shares that were deemed to have been issued by virtue of the
computation made in connection with the adjustment so rescinded and annulled
shall no longer be deemed to have been issued by virtue of such computation.
Thereupon, a recomputation shall be made of the effect of such rights or
options or other Convertible Securities on the basis of

          (C) treating the number of Additional Common Shares or other
     property, if any, theretofore actually issued or issuable pursuant to the
     previous exercise of any such warrants or rights or any such right of
     conversion or exchange, as having been issued on the date or dates of any
     such exercise and for the consideration actually received and receivable
     therefor, and

          (D) treating any such warrants or rights or any such other
     Convertible Securities that then remain outstanding as having been granted
     or issued immediately after the time of such increase of the consideration
     per share for which Common Shares or other property are issuable under
     such warrants or rights or other Convertible Securities; whereupon a new
     adjustment of the number of Common Shares into which the Series A
     Preferred Shares are convertible shall be made, which new adjustment shall
     supersede the previous adjustment so rescinded and annulled.

     (vii) Other Provisions Applicable to Adjustments under this Section. The
following provisions shall be applicable to the making of adjustments to the
number of Common Shares into which the Series A Preferred Shares are
convertible provided for in this Subsection (c):

          (A) Computation of Consideration. To the extent that any Additional
     Common Shares or any Convertible Securities or any warrants or other
     rights to subscribe for or purchase any Additional Common Shares or any
     Convertible Securities shall be issued for cash consideration, the
     consideration received by the Corporation therefor shall be the amount of
     the cash received by the Corporation therefor, or, if such Additional
     Common Shares or Convertible Securities are offered by the Corporation for
     subscription, the subscription price, or, if such Additional Common Shares
     or Convertible Securities are sold to underwriters or dealers for public
     offering without a subscription offering, the initial public offering
     price (in any such case subtracting any amounts paid or receivable for
     accrued interest or accrued dividends and without taking into account any
     compensation, discounts or expenses paid or incurred by the Corporation
     for and in the underwriting of, or otherwise in connection


                                    Page 14



     with, the issuance thereof). To the extent that such issuance shall be for
     a consideration other than cash, then, except as herein otherwise
     expressly provided, the amount of such consideration shall be deemed to be
     the fair value of such consideration at the time of such issuance as
     determined in good faith by the Board of Directors of the Corporation. In
     case any Additional Common Shares or any Convertible Securities or any
     warrants or other rights to subscribe for or purchase such Additional
     Common Shares or Convertible Securities shall be issued in connection with
     any merger in which the Corporation issues any securities, the amount of
     consideration therefor shall be deemed to be the fair value, as determined
     in good faith by the Board of Directors of the Corporation, of such
     portion of the assets and business of the nonsurviving corporation as such
     Board in good faith shall determine to be attributable to such Additional
     Common Shares, Convertible Securities, warrants or other rights, as the
     case may be. The consideration for any Additional Common Shares issuable
     pursuant to any warrants or other rights to subscribe for or purchase the
     same shall be the consideration received by the Corporation for issuing
     such warrants or other rights plus the additional consideration payable to
     the Corporation upon exercise of such warrants or other rights. The
     consideration for any Additional Common Shares issuable pursuant to the
     term of any Convertible Securities shall be the consideration received by
     the Corporation for issuing warrants or other rights to subscribe for or
     purchase such Convertible Securities, plus the consideration paid or
     payable to the Corporation in respect of the subscription for or purchase
     of such Convertible Securities, plus the additional consideration, if any,
     payable to the Corporation upon the exercise of the right of conversion or
     exchange in such Convertible Securities. In case of the issuance at any
     time of any Additional Common Shares or Convertible Securities in payment
     or satisfaction of any dividends upon any class of stock other than Common
     Shares, the Corporation shall be deemed to have received for such
     Additional Common Shares or Convertible Securities a consideration equal
     to the amount of such dividend so paid or satisfied.

          (B) When Adjustments to Be Made. The adjustments required by this
     Subsection (c) shall be made whenever and as often as any specified event
     requiring an adjustment shall occur, except that any adjustment to the
     number of Common Shares into which the Series A Preferred Shares are
     convertible that would otherwise be required may be postponed (except in
     the case of a subdivision or combination of Common Shares, as provided for
     in Subsection (c)(i)) up to, but not beyond the date of conversion if such
     adjustment either by itself or with other adjustments not previously made
     adds or subtracts less than 1% of the Common Shares into which the Series
     A Preferred Shares are convertible immediately prior to the making of such
     adjustment. Any adjustment representing a change


                                    Page 15



     of less than such minimum amount (except as aforesaid) that is postponed
     shall be carried forward and made as soon as such adjustment, together
     with other adjustments required by this Subsection (c) and not previously
     made, would result in a minimum adjustment or on the date of conversion.
     For the purpose of any adjustment, any specified event shall be deemed to
     have occurred at the close of business on the date of its occurrence.

          (C) Fractional Interests. In computing adjustments under this
     Subsection (c), fractional interests in Common Shares shall be taken into
     account to the nearest 1/1000th of a share.

          (D) When Adjustment Not Required. If the Corporation shall take a
     record of the holders of its Common Shares for the purpose of entitling
     them to receive a dividend or distribution or subscription or purchase
     rights and shall, thereafter and before the distribution to shareholders
     thereof, legally abandon its plan to pay or deliver such dividend,
     distribution, subscription or purchase rights, then thereafter no
     adjustment shall be required by reason of the taking of such record and
     any such adjustment previously made in respect thereof shall be rescinded
     and annulled.

          (E) Escrow of Shares. If after any property becomes distributable
     pursuant to this Subsection (c) by reason of the taking of any record of
     the holders of Common Shares, but prior to the occurrence of the event for
     which such record is taken and the holders of Series A Preferred Shares
     convert such Series A Preferred Shares, any Additional Common Shares
     issuable upon exercise by reason of such adjustment shall be deemed the
     last Common Shares into which the Series A Preferred Shares have been
     converted (notwithstanding any other provision to the contrary herein) and
     such shares or other property shall be held in escrow for such holder by
     the Corporation to be issued to such holder upon and to the extent that
     the event actually takes place. Notwithstanding any other provision to the
     contrary herein, if the event for which such record was taken fails to
     occur or is rescinded, then such escrowed shares shall be cancelled by the
     Corporation and escrowed property returned to the Corporation.

          (F) Challenge to Good Faith Determination. Whenever the Board of
     Directors of the Corporation shall be required to make a determination in
     good faith of the fair value of any item under this Subsection (c), such
     determination may be challenged in good faith by the Majority Holders, and
     any dispute shall be resolved by an investment banking or valuation firm
     of recognized national standing selected by the Corporation and acceptable
     to the Majority Holders.


                                    Page 16



          (G) Prohibition on Adjustment. The provisions of Subsections
     (c)(iii), (c)(iv) and (c)(v) shall not operate to reduce the number of
     Common Shares which will be issued upon conversion of the Series A
     Preferred Shares.

     (viii) Reorganization, Reclassification, Merger, Consolidation or
Disposition of Assets. In case the Corporation shall reorganize its capital,
reclassify its capital stock, consolidate or merge with or into another
corporation (where the Corporation is not the surviving corporation or where
there is a change in or distribution with respect to the Common Shares), or
sell, transfer or otherwise dispose of all or substantially all its property,
assets or business to another corporation and, pursuant to the terms of such
reorganization, reclassification, merger, consolidation or disposition of
assets, Common Shares of the successor or acquiring corporation, or any cash,
shares of stock or other securities or property of any nature whatsoever
(including warrants or other subscription or purchase rights) in addition to or
in lieu of common stock of the successor or acquiring corporation ("Other
Property"), are to be received by or distributed to the holders of Common
Shares of the Corporation, then each holder of Series A Preferred Shares shall
have the right thereafter to receive, upon conversion of such Series A
Preferred Shares, the number of Common Shares of the successor or acquiring
corporation or of the Corporation, if it is the surviving corporation, and
Other Property receivable upon or as a result of such reorganization,
reclassification, merger, consolidation or disposition of assets by a holder of
the number of Common Shares into which the Series A Preferred Shares owned by
such holder are convertible immediately prior to such event. In case of any
such reorganization, reclassification, merger, consolidation or disposition of
assets, the successor or acquiring corporation (if other than the Corporation)
shall expressly assume the due and punctual observance and performance of each
and every covenant and condition of the Series A Preferred Shares to be
performed and observed by the Corporation and all the obligations and
liabilities hereunder, subject to such modifications as may be deemed
appropriate (as determined by resolution of the Board of Directors of the
Corporation) in order to provide for adjustments of Common Shares into which
the Series A Preferred Shares are convertible which shall be as nearly
equivalent as practicable to the adjustments provided for in this Subsection
(c). For purposes of this Subsection (c)(viii), "common stock of the successor
or acquiring corporation" shall include stock of such corporation of any class
that is not preferred as to dividends or assets over any other class of stock
of such corporation and that is not subject to redemption and shall also
include any evidences of indebtedness, shares of stock or other securities that
are convertible into or exchangeable for any such stock, either immediately or
upon the arrival of a specified date or the happening of a specified event and
any warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Subsection (c)(viii) shall similarly apply to


                                    Page 17



successive reorganizations, reclassifications, mergers, consolidations or
disposition of assets.

     (ix) Other Action Affecting Common Shares. In case at any time or from
time to time the Corporation shall take any action in respect of its Common
Shares, other than any action described in this Subsection (c), then, unless
such action will not have a materially adverse effect upon the rights of
holders of Series A Preferred Shares, the number of Common Shares or other
stock into which the Series A Preferred Shares are convertible shall be
adjusted in such manner as may be equitable in the circumstances.

     (d) Notices to Holders of Series A Preferred Shares.

          (i) Notice of Adjustments. Not less than 10 nor more than 30 days
     prior to the record date or effective date, as the case may be, of any
     action that requires or might require an adjustment or readjustment
     pursuant to Subsection (c), the Corporation shall forthwith prepare and
     deliver to each holder of Series A Preferred Shares, a signed copy of a
     certificate executed by the chief financial officer of the Corporation
     setting forth, in reasonable detail, the event requiring the adjustment
     and the method by which such adjustment was calculated (including a
     description of the basis on which the Board of Directors of the
     Corporation determined the fair value of any evidences of indebtedness,
     shares of stock, other securities or property or warrants or other
     subscription or purchase rights referred to in Subsection (c)(vii)(A),
     specifying the number of Common Shares into which the Series A Preferred
     Shares are convertible and (if such adjustment was made pursuant to
     Subsections (c)(viii) or (c)(ix)) describing the number and kind of any
     other shares of stock or Other Property into which the Series A Preferred
     Shares are convertible, after giving effect to such adjustment or change.
     The Corporation shall keep at its office or agency copies of all such
     certificates and cause the same to be available for inspection at said
     office during normal business hours by any holder of Series A Preferred
     Shares or any prospective purchaser of Series A Preferred Shares
     designated by a holder thereof.

          (ii) Notice of Corporate Action. If at any time:

          (A) the Corporation shall take a record of the holders of its Common
     Shares for the purpose of entitling them to receive a dividend or other
     distribution, or any right to subscribe for or purchase any evidences of
     its indebtedness, any shares of stock of


                                    Page 18



     any class or any other securities or property, or to receive any other
     right, or

          (B) there shall be any capital reorganization of the Corporation, any
     reclassification or recapitalization of the capital stock of the
     Corporation or any consolidation or merger of the Corporation with, or any
     sale, transfer or other disposition of all or substantially all the
     property, assets or business of the Corporation to, another corporation,
     person or entity, or

          (C) there shall be a voluntary or involuntary dissolution,
     liquidation or winding up of the Corporation;

then, in any one or more of such cases, the Corporation shall give to each
holder of Series A Preferred Shares (A) at least 30 days prior written notice
of the date on which a record date shall be selected for such dividend,
distribution or right or for determining rights to vote in respect of any such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up, and (B) in the case of any
such reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up, at least 30 days prior
written notice of the date when the same shall take place. Such notice in
accordance with the foregoing clause also shall specify (A) the date on which
any such record is to be taken for the purpose of such dividend, distribution
or right, the date on which the holders of Common Shares shall be entitled to
any such dividend, distribution or right, and the amount and character thereof,
and (B) the date on which any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, dissolution, liquidation or winding
up is to take place and the time, if any such time is to be fixed, as of which
the holders of Common Shares shall be entitled to exchange their Common Shares
for securities or other property deliverable upon such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
dissolution, liquidation or winding up. Each such written notice shall be
sufficiently given if addressed to each holder of Series A Preferred Shares at
the last address of such holder appearing on the books of the Corporation.

VI. Redemption of Series A Preferred Shares.

     (a) Mandatory Redemption. The Corporation shall redeem all of the issued
and outstanding Series A Preferred Shares on September 30, 2010 (the
"Redemption Date"). The redemption price for the Series A Preferred Shares
redeemed shall be the Liquidation Preference Amount (the "Redemption Price").
If on the Redemption Date the funds of the Corporation legally available are
insufficient to redeem all of the Series A Preferred Shares, the number of
Series A Preferred Shares legally permitted to be redeemed shall be redeemed
and Series A


                                    Page 19



Preferred Shares which the Corporation is legally unable to redeem shall be
redeemed as soon thereafter as funds become legally available for such
redemption. In addition, with respect to any Series A Preferred Shares that the
Corporation is legally or otherwise unable to redeem within the one year period
commencing on the Redemption Date and, if the Conversion Ratio has not been
increased pursuant to Section VII, then, subject to NASDAQ Approval, the
Conversion Ratio applicable to such Series A Preferred Shares shall increase
from 4 Common Shares for each Series A Preferred Share to 8 Common Shares for
each Series A Preferred Share and the holders of the Series A Preferred Shares
shall have the right to convert such Series A Preferred Shares at any time
prior to redemption thereof by the Corporation.

     (b) Proration. To the extent the Corporation is legally unable to redeem
all Series A Preferred Shares on the Redemption Date, the Series A Preferred
Shares to be redeemed shall be selected pro rata in accordance with the ratio
the number of Series A Preferred Shares held by each respective holder bears to
the total number of Series A Preferred Shares then issued and outstanding. Not
less than 30 or more than 60 days' previous notice shall be given to the
holders of record of the Series A Preferred Shares to be redeemed, by
registered or certified mail, postage prepaid.

     (c) Mechanics. At least 60 days prior to the Redemption Date, written
notice (hereinafter referred to as the "Redemption Notice") shall be mailed,
postage prepaid, to each holder of record of the Series A Preferred Shares, at
its address shown on the records of the Corporation; provided, however, that
the Corporation's failure to give such Redemption Notice shall in no way affect
its obligation to redeem Series A Preferred Shares as provided in Section VI(a)
hereof. The Redemption Notice shall contain the following information:

          (i) the number of Series A Preferred Shares held by the holder and
     the total number of Series A Preferred Shares held by all holders;

          (ii) the Redemption Date and the applicable Redemption Price;

          (iii) the number of Series A Preferred Shares to be redeemed; and

          (iv) a statement that the holder is to surrender to the Corporation,
     at the place designated herein, its certificate or certificates
     representing the Series A Preferred Shares to be redeemed.

     (d) Surrender of Certificates. Each holder of Series A Preferred Shares to
be redeemed shall surrender the certificate or certificates representing such
shares to the Corporation, and thereupon the applicable Redemption Price for
such shares as set forth in this Section 6 shall be paid to the order of the
person


                                    Page 20



whose name appears on such certificate or certificates and each surrendered
certificate shall be cancelled and retired and new certificates representing
any Series A Preferred Shares not redeemed shall be issued to the holder at no
additional cost.

VII. Put Options.

     (a) General Put Option. On September 30, 2004, the Majority Holders shall
have the right to require the Corporation to purchase all or part of the Series
A Preferred Shares that the Majority Holders then own at a purchase price equal
to the Put Option Purchase Price. If the Corporation fails to so purchase any
Put Shares under this Section VII(a) within any applicable Closing Period or
any applicable Subsequent Closing Period (each as defined in clause (f) below),
then, subject to NASDAQ Approval, the Conversion Ratio applicable to all
outstanding Series A Preferred Shares shall increase from 4 Common Shares for
each Series A Preferred Share to 8 Common Shares for each Series A Preferred
Share.

     (b) Opt Out/NASDAQ Put. If either (i) the Control Share Acquisition
Resolution is not approved by the affirmative vote of the holders of shares
entitling them to exercise a majority of the voting power of the Corporation at
the Corporation's 1999 annual meeting of shareholders, or (ii) NASDAQ Approval
is not obtained at the Corporation's 1999 annual meeting of shareholders, then
the Majority Holders shall have the right to require the Corporation to
purchase all or part of the Series A Preferred Shares that the Majority Holders
then own at a purchase price equal to the Put Option Purchase Price.

     (c) Governmental Approval Put. If within 365 days after the Original
Purchaser has filed its Notification and Report Form as required under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, in connection
with a Second Occurrence Failure by the Corporation under the Contingent
Warrant Agreement, the Corporation and the Original Purchaser are unable to
obtain all governmental and other approvals required under any applicable laws,
statutes, orders, rules, regulations or policies, or any guidelines promulgated
thereunder, including, without limitation, under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended ("Government Approval"), then
the Majority Holders shall have the right to require the Corporation to
purchase all or part of the Series A Preferred Shares that the Majority Holders
then own at a purchase price equal to the Put Option Purchase Price.

     (d) Occurrence Based Put. If the Corporation or any of its Subsidiaries
shall (i) authorize or issue any shares of capital stock of any class or any
options, warrants, or rights to purchase capital stock of any class or any
securities convertible into capital stock of any class, other than (A)
Conversion Shares issued upon conversion of the Series A Preferred Shares, (B)
Warrant Shares


                                    Page 21



issued upon exercise of the Warrant, (C) Common Shares issued to employees of
the Corporation pursuant to the Stock Plans, (D) Contingent Shares issued upon
exercise of the Contingent Warrants, (E) capital stock of any Subsidiary issued
to the Corporation or any Subsidiary or (F) Common Shares issued to satisfy
obligations in respect of acquisitions of securities or assets of any Person,
provided that (I) such contracts were entered into prior to September 30,1999,
and (II) the number of Common Shares subject to this subparagraph (F) shall not
exceed 110,000 in the aggregate, or (ii) directly or indirectly sell, lease, or
otherwise dispose of more than 10% of the properties and assets of the
Corporation and its Subsidiaries on a consolidated basis, in the aggregate, to
any Person (other than the Corporation any Subsidiary), whether in one
transaction or in a series of transactions over any period of twelve
consecutive months, or (iii) merge into or with or consolidate with any other
Person other than a Subsidiary, or (iv) create, incur, assume, or otherwise
become or remain liable, directly or indirectly, for any Indebtedness for
Borrowed Money that would cause the Corporation to have Indebtedness for
Borrowed Money in excess of $210,000,000 in the aggregate at any time, whether
by loan, guaranty, mortgage, or otherwise, excluding indebtedness incurred in
connection with a redemption of Series A Preferred Shares, then in any such
case the Majority Holders shall have the right to require the Corporation to
purchase all or part of the Series A Preferred Shares that the Majority Holders
then own at a purchase price equal to the Put Option Purchase Price. If the
Corporation fails to so purchase any Put Shares under this Section VII(d)
within any applicable Closing Period or any applicable Subsequent Closing
Period, then, subject to NASDAQ Approval, the Conversion Ratio applicable to
all outstanding Series A Preferred Shares shall increase from 4 Common Shares
for each Series A Preferred Share to 8 Common Shares for each Series A
Preferred Share.

     (e) Mechanics. The Corporation shall deliver written notice to each holder
of Series A Preferred Shares at such holder's address on the books and records
of the Corporation of each event giving rise to a Put Option under clauses (b),
(c) and (d) of this Section VII (the "Corporation Put Right Notice"). The
Corporation Put Right Notice shall be mailed by first class certified mail,
return receipt requested, no later than two (2) business days after the
occurrence of the event giving rise to the Put Option. In order to exercise a
Put Option under clause (b), (c) or (d) of this Section VII, a holder of the
Series A Preferred Shares shall, no later than ninety (90) days after receipt
of the Corporation Put Right Notice, send written notice to the Corporation
specifying that the holder has elected to exercise its Put Option. In order to
exercise a Put Option under clause (a) of this Section VII, a holder of the
Series A Preferred Shares shall, no later than September 30, 2004, send written
notice to the Corporation specifying that it has elected to exercise the Put
Option.


                                    Page 22



     (f) Closing Period. If the purchase or redemption of Put Shares under
clauses (a), (b), (c) or (d), as the case may be, would not cause or constitute
a default under any agreement or indenture relating to indebtedness of the
Corporation then outstanding (collectively, the "Credit Agreements"), the
closing of the purchase of Put Shares under this Section VII shall occur as
soon as practicable after the delivery of a Put Option Notice with respect to
such Put Shares on a date mutually acceptable to the Majority Holders and the
Corporation, but in no event later than one year from the date of delivery of
the applicable Put Option Notice (the "Closing Period"). If the Corporation may
purchase part but not all of the Put Shares without causing a default under the
Credit Agreements, the Corporation shall purchase, within the Closing Period,
that number of Put Shares (pro rata from each holder based on the number of Put
Shares held by each holder and the total number of Put Shares held by all
holders) that it may purchase without causing or constituting a default under
the Credit Agreements. Subject to any earlier conversion of any Put Shares, the
Corporation shall from time to time purchase Put Shares at any time that any
such purchase would not cause or constitute a default under the Credit
Agreements. The closing of the purchase of any Put Shares under the preceding
sentence shall occur as soon as practicable after the date that the
determination is made that such purchase will not cause or constitute a default
under the Credit Agreements on a date mutually acceptable to the Majority
Holders and the Corporation, but in no event later than sixty (60) days after
the date of such determination (each, a "Subsequent Closing Period"). Until
purchased by the Corporation in accordance with the terms of this Section VII,
the holders of the Put Shares shall have the right to convert Put Shares
notwithstanding delivery of a Put Option Notice.

     (g) Surrender of Certificates. Each holder of Put Shares to be purchased
pursuant to a Put Option shall surrender the certificate or certificates
representing all such Put Shares to the Corporation on or before the closing of
the purchase of the Put Shares, and thereupon the applicable Put Option
Purchase Price for such shares as set forth in this Section VII shall be paid
to the order of the person whose name appears on such certificate or
certificates for each Put Share purchased and each surrendered certificate
shall be cancelled and retired and new certificates representing any Series A
Preferred Shares not purchased shall be issued to the holder at no additional
cost. If any Put Shares are not purchased within the Closing Period or
Subsequent Closing Period, as the case may be, each certificate issued
representing such shares shall bear a legend indicating the increase, if any,
in the Conversion Ratio pursuant to this Section VII.

     (h) Certain Definitions. For purpose of this Section VII, the following
terms shall have the following meanings:


                                    Page 23



     "Put Option" shall mean the option of the Majority Holders to require the
Corporation to purchase the Series A Preferred Shares owned by the Majority
Holders under clauses (a), (b), (c) and (d) of this Section VII.

     "Put Option Date" shall mean the date on which the Original Purchaser has
actual notice that an event giving rise to a Put Option under this Section VII
has occurred.

     "Put Option Notice" shall mean the written notice sent by the Original
Purchaser to the Corporation pursuant to which the Original Purchaser notifies
the Corporation that it is exercising its Put Option right under clause (a),
(b), (c) or (d) of this Section VII.

     "Put Option Purchase Price" shall mean the Liquidation Preference Amount.

     "Put Shares" shall mean any Series A Preferred Shares with respect to
which the Majority Holders have elected to exercise their right to require the
Corporation to purchase under clauses (a), (b), (c) or (d) of this Section VII.

VIII. No Reissuance of Preferred Stock. No Series A Preferred Share or Series A
Preferred Shares acquired by the Corporation by reason of redemption, purchase,
conversion or otherwise shall be reissued, and all such shares shall be
cancelled, retired and eliminated from the shares which the Corporation shall
be authorized to issue. The President or any Vice President and the Secretary
or any Assistant Secretary of the Corporation are hereby authorized and
directed on behalf of the Corporation to file such documents from time to time
as may be necessary to reduce the authorized number of Series A Preferred
Shares accordingly.


                                    Page 24



                  Prescribed by J. Kenneth Blackwell
                  Please obtain fee amount and mailing instructions from the
                  Forms Inventory List (using the 3 digit form # located at the
[SEAL]            bottom of this form). To obtain the Forms Inventory List or
                  for assistance, please call Customer Service:
                  Central Ohio: (614)-466-3910
                  Toll Free: 1-877-SOS-FILE (1-877-767-3453)


                                 CERTIFICATION

                       RETURN THE ATTACHED DOCUMENTS TO:

- -------------------------------------------------------------------------------
              BAKER & HOSTETLER LLP            Mo Keifer       462-4718
- -------------------------------------------------------------------------------
           NAME OF YOUR FIRM OR COMPANY        ATTENTION      PHONE NUMBER
- -------------------------------------------------------------------------------

COMPANY NAME               1    Advanced Lighting Technologies, Inc.
                                ------------------------------------------------
COMPANY NAME               2
                                ------------------------------------------------
COMPANY NAME               3
                                ------------------------------------------------

Please write the numbers 1, 2, or 3 in the appropriate boxes identifying the
company and the information being requested. Write the word ALL if a particular
request is being made for all of the above companies.

  [ ]  Good Standing Certificate            [ ]  Certificate of Full Force and
                                                 Effect
  [ ]  No Record Certificate
                                            [ ]  Certificate Re: Name Change
  [ ]  Long Form Good Standing Certificate
            (lists all chartered filings)   [ ]  Certificate Re: Merger

                          [ ]  Cancellation Certificate


                                     COPIES

  [X]  Certified Copies                     [ ]  Plain Copies

  [ ]  CERTIFICATE ORGANIZATION             [ ]  SOS Certificate of Filing

  [X]  FILING - AMENDMENT                   [ ]  Limited Liability Co.

  [ ]  Limited Partnership                  [ ]  Subsequent Appointment of Agent


                                    Page 25



                  Prescribed by J. Kenneth Blackwell
                  Please obtain fee amount and mailing instructions from the
                  Forms Inventory List (using the 3 digit form # located at the
[SEAL]            bottom of this form). To obtain the Forms Inventory List or
                  for assistance, please call Customer Service:
                  Central Ohio: (614)-466-3910
                  Toll Free: 1-877-SOS-FILE (1-877-767-3453)


[ ]  UNIFORM COMMERCIAL CODE FILINGS

[X]  CORPORATE FILINGS

                   -----------------------------------------
                               CORPORATIONS ONLY

                                  [X] EXPEDITE
                                      SERVICE
                   -----------------------------------------

                                 CORRESPONDENCE

                    PLEASE RETURN THE ATTACHED DOCUMENTS TO:


BAKER & HOSTETLER LLP
- -------------------------------------------------------------------------------
NAME OF YOUR FIRM OR COMPANY

Mo Keifer, Paralegal
- -------------------------------------------------------------------------------
ATTN

65 East State Street, Suite 2100
- -------------------------------------------------------------------------------
STREET ADDRESS

Columbus, OH 43215
- -------------------------------------------------------------------------------
CITY                                        STATE                      ZIP

614-462-4718
- -------------------------------------------------------------------------------
TELEPHONE


                 ---------------------------------------------
                                    UCC ONLY

                              [ ] MAIL [ ] PICK UP
                       IF NOT CHECKED, IT WILL BE MAILED
                 ---------------------------------------------


                                    Page 26



Return To:
BAKER & HOSTETLER
ATTN M KEIFER
65 E STATE ST STE 2100
COLUMBUS, OH 43215-0000

- ---------------------------cut along the dotted line----------------------------
             ====================================================

                               The State of Ohio
                                  Certificate

                   Secretary of State - J. Kenneth Blackwell

                                     904931

It is hereby certified that the Secretary of State of Ohio has custody of the
business records for ADVANCED LIGHTING TECHNOLOGIES, INC. and that said
business records show the filing and recording of:

     Document(s)                                    Document No(s):
     DOMESTIC/AMENDMENT TO ARTICLES                 199928002410


                                   ---------

         United States of America          Witness my hand and the seal of the
              State of Ohio                Secretary of State at Columbus, Ohio,
     Office of the Secretary of State       This 6th day of October, A.D. 1999

                                           /s/ J. Kenneth Blackwell
                                           ------------------------
                  [SEAL]                       J. Kenneth Blackwell
                                               Secretary of State


                                    Page 27



                            CERTIFICATE OF ADOPTION
                                       OF
                                FOURTH AMENDMENT
                                       TO
             SECOND AMENDED AND RESTATED ARTICLES OF INCORPORATION
                                       OF
                      ADVANCED LIGHTING TECHNOLOGIES, INC

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

     Alan J. Ruud, President, of ADVANCED LIGHTING TECHNOLOGIES, INC., an Ohio
corporation, having its principal office in the City of Solon, Ohio, does
hereby certify that on the 17th day of February, 2000, pursuant to the
authority of Ohio Revised Code Section 17001.71(A) and Article Eleventh of the
Second Amended and Restated Articles of Incorporation, as amended, of said
Corporation, the holders of a majority of the issued and outstanding common
shares and preferred shares of said Corporation entitled to vote at a meeting
of shareholders, approved the following action and adopted the following
resolution amending the existing Second Amended and Restated Articles of
Incorporation:

     RESOLVED, that, pursuant to Section 1701.71(A) of the Ohio Revised Code,
     Advanced Lighting Technologies, Inc. (the "Corporation") effective on the
     date of filing of a certified copy of this resolution with the Secretary
     of State of the State of Ohio, the Second Amended and Restated Articles of
     Incorporation, as amended, of the Corporation are hereby amended to add
     the following new Article TWELFTH:

          "TWELFTH: Section 1701.831 of the Ohio Revised Code shall not apply
          to control share acquisitions of shares of the Corporation."

Such amendment shall, and does hereby, amend such Second Amended and Restated
Articles of Incorporation effective on such date.

     IN WITNESS WHEREOF, Alan J. Ruud, President, acting for and on behalf of
said Corporation, has hereunto subscribed his name this 7 day of March, 2000.


                                    /s/ Alan J. Ruud
                                    -------------------------------
                                    Alan J. Ruud, President





Return To:
CORPORATE SERVICES OF OHIO, INC
50 W BROAD ST STE 1120
COLUMBUS, OH 43215-0000

- ---------------------------cut along the dotted line----------------------------
             ====================================================

                               The State of Ohio
                                  Certificate

                   Secretary of State - J. Kenneth Blackwell

                                     904931

It is hereby certified that the Secretary of State of Ohio has custody of the
business records for ADVANCED LIGHTING TECHNOLOGIES, INC. and that said
business records show the filing and recording of:

     Document(s)                                    Document No(s):
     DOMESTIC/AMENDMENT TO ARTICLES                 200007700925


                                   ---------

         United States of America          Witness my hand and the seal of the
              State of Ohio                Secretary of State at Columbus, Ohio,
     Office of the Secretary of State       This 16th day of March, A.D. 2000

                                           /s/ J. Kenneth Blackwell
                                           ------------------------
                  [SEAL]                       J. Kenneth Blackwell
                                               Secretary of State





                                   EXHIBIT C
               To First Amended Chapter 11 Plan of Reorganization


                    New ADLT Code of Regulations (By-Laws)1



- ---------
     1 After the filing of the Plan on August 15, 2003, the Debtors and
Saratoga determined that due to possible adverse tax consequences, they would
not seek to reincorporate ADLT as a Delaware corporation on the Effective Date.
Accordingly, ADLT will not be required to adopt new by-laws under Delaware law.
Additionally, the Debtors and Saratoga have not yet determined whether ADLT
will be required to adopt a new, amended code of regulations (by-laws) under
Ohio law as of the Effective Date. Included in this Exhibit C is ADLT's
existing code of regulations (by-laws). In the event that an amended code of
regulations (by-laws) is required, the Debtors will file such amended code of
regulations with the final version of the Plan on or about September 19, 2003.






                              CODE OF REGULATIONS

                                       OF

                      ADVANCED LIGHTING TECHNOLOGIES, INC.


                                   ARTICLE I

                                    OFFICES


     Section 1. Principal Office

     The principal office of the Corporation shall be at Solon, Ohio, or at
such other place in the State of Ohio as may be designated from time-to-time by
the Board of Directors.

     Section 2. Other Offices

     The Corporation may also have offices at such other places without, as
well as within, the State of Ohio as the Board of Directors shall from
time-to-time determine.

                                   ARTICLE II

                                  SHAREHOLDERS


     Section 1. Annual Meeting

     The annual meeting of shareholders shall be held at the principal office
of the Corporation or at such other place as may be determined by the Board of
Directors and designated in the notice of said meeting, on such month and day,
at such hour and at such place as the Directors may determine; and if not so
determined, at 10:00 a.m. on the first Monday of October of each year, if not a
legal holiday, and if a legal holiday, then on the next day not a legal
holiday, for the purpose of electing Directors and considering reports to be
laid before said meeting. Upon due notice, there may also be considered and
acted upon at an annual meeting any matter which could properly be considered
and acted upon at a special meeting, in which case and for which purpose, the
annual meeting shall also be considered as, and shall be, a special meeting. If
the annual meeting shall not be held or if Directors shall not be elected
thereat, a special meeting may be called and held for that purpose.





     Section 2. Special Meetings

     Special meetings of the shareholders may be called by the Chairman of the
Board, the Chief Executive Officer, the President, or, in the case of the
President's absence, death or disability, the Vice-President authorized to
exercise the authority of the President or by the Directors by action at a
meeting, or a majority of the Directors acting without a meeting, or by the
person or persons holding not less than a majority of all of the shares
outstanding and entitled to vote thereat.

     Upon request in writing delivered either in person or by registered mail
to the President or Secretary by any person or persons entitled to call a
meeting of shareholders, it shall be the duty of the President or Secretary to
give to the shareholders entitled thereto, notice of a meeting to be held on a
day not less than ten (10) nor more than sixty (60) days after the receipt of
such request, as such officer may specify. If such notice shall not be given
within fifteen (15) days after the delivery of such request, the person or
persons calling the meeting may fix the time of the meeting and give notice
thereof, as hereinafter provided in Section 4 of this Article II, or cause such
notice to be given by any designated representative.

     Section 3. Place of Meetings

     Any meeting of the shareholders of the Corporation may be held either
within or without the State of Ohio.

     Section 4. Notice of Meetings

     Notice of all shareholders' meetings, whether annual or special, shall be
given in writing and may be given by the Chairman of the Board, the Chief
Executive Officer, the President or a Vice-President or by the Secretary or an
Assistant Secretary (or in case of their refusal, by or at the direction of the
person or persons entitled to call meetings under the provisions of these
Regulations), which notice shall state the purpose or purposes for which the
meeting is called and the time when and place where it is to be held. Not more
than sixty (60) nor less than seven (7) days prior to any such meeting, a copy
of such notice shall be served upon or mailed to each shareholder of record
entitled to notice thereof, directed, postage prepaid, to his last address as
it appears upon the records of the Corporation. If any meeting shall be
adjourned to another time or place, no further notice as to such reconvened
meeting need be given other than by announcement at the meeting at which such
adjournment shall be taken. No business shall be transacted at any such
reconvened meeting except as might have been lawfully transacted at the meeting
at which such adjournment shall have been taken.


                                       2



     Section 5. Waiver of Notice

     Notice of the time, place and purposes of any meeting of shareholders may
be waived in writing, either before or after the holding of such meeting, by
any shareholder, which writing shall be filed with or entered upon the records
of the meeting. The attendance of any shareholder at any such meeting without
protesting, prior to or at the commencement of the meeting, the lack of proper
notice, shall be deemed to be a waiver by such shareholder of notice of such
meeting.

     Section 6. Record Date for Notice and Voting

     The Board of Directors may fix a date, which shall not be a past date, not
exceeding sixty (60) days preceding the date of any meeting of shareholders, as
a record date for the determination of the shareholders entitled to notice of
such meeting or to vote thereat, and/or the Board of Directors may close the
books of the Corporation against transfer of shares during the whole or any
part of such period, including the date of the meeting of the shareholders and
the period ending with the date, if any, to which adjourned.

     Section 7. Inspectors of Election

     In advance of any meeting of shareholders, the Board of Directors may
appoint Inspectors of Election to act at such meeting and at any adjournment or
adjournments thereof. If such Inspectors shall not be so appointed, the
Chairman of any such meeting may, and on the request of any shareholder or his
proxy shall, make such appointments. No such Inspector need be a shareholder of
the Corporation.

     In case any person appointed as such Inspector shall fail to appear or
refuse to act, the vacancy may be filled by appointment made by the Board of
Directors in advance of the meeting; or if not so filled, such vacancy may, and
on request of any shareholder or his proxy shall, be filled at the meeting by
the Chairman thereof.

     The Inspectors shall determine the number of shares outstanding, the
voting rights of each, the shares represented at the meeting, the existence of
a quorum, the authenticity, validity and effect of proxies; shall receive
votes, ballots, consents, waivers or releases; hear and determine all
challenges and questions in any way arising in connection with the vote; count
and tabulate all votes, consents, waivers and releases; determine and announce
the result; and do such acts as may be proper to conduct the election or vote
with fairness to all shareholders. On request, the Inspectors shall make a
report in writing of any challenge, question or matter determined by them, and
shall make and execute a certificate of any fact found by them.


                                       3



     If there shall be three (3) or more Inspectors, the decision, act or
certificate of a majority of them shall be effective in all respects as the
decision, act or certificate of all. The certificate of the Inspectors shall be
prima facie evidence of the facts stated therein and of the vote as certified
by them.

     Section 8. Quorum

     The holders of a majority of the outstanding shares entitled to vote,
present in person or by proxy at any meeting of shareholders, shall constitute
a quorum for such meeting, but no action required by law, the Articles or the
Regulations to be authorized or taken by the holders of a designated proportion
of the shares of any particular class or of each class, may be authorized or
taken by a lesser proportion.

     The holders of a majority of the voting shares represented at a meeting,
whether or not a quorum is present, may adjourn such meeting from time-to-time.

     Section 9. Voting

     Except when votes are cumulated in the election of Directors as
hereinafter provided and except as otherwise provided in the Articles, each
outstanding share, regardless of class, shall entitle the holder thereof to one
(1) vote on each matter properly submitted to the shareholders for their vote,
consent, waiver, release or other action.

     If notice in writing is given by any shareholder to the President,
Vice-President or the Secretary of the Corporation, not less than forty-eight
(48) hours (but, if less than ten (10) days' notice of the meeting was given,
not less than twenty-four (24) hours) before the time fixed for the holding of
a meeting of the shareholders for the purpose of electing Directors, that such
shareholder desires that the voting at such election shall be cumulative, and
if an announcement of the giving of such notice is made upon the convening of
the meeting by the Chairman or Secretary or by or on behalf of the shareholder
giving such notice, each shareholder shall have the right to cumulate the
voting power he possesses and to give one (1) candidate as many votes as equal
the number of Directors to be elected multiplied by the number of his votes, or
to distribute his votes on the same principle among two (2) or more candidates,
as he may see fit.

     Section 10. Proxies

     A person who is entitled to attend a shareholders' meeting, to vote
thereat or to execute consents, waivers or releases, may be represented at such
meeting or vote thereat, and execute consents, waivers and releases, and
exercise any of his other rights, by proxy or proxies appointed by a writing
signed by such person.


                                       4



     A telegram or cablegram appearing to have been transmitted by such person,
or a facsimile, photographic, photostatic or equivalent reproduction of a
writing, appointing a proxy is a sufficient writing.

     No appointment of a proxy shall be valid after the expiration of eleven
(11) months after it is made unless the writing shall specify the date on which
it is to expire or the length of time it is to continue in force.

     The presence at a meeting of the person appointing a proxy shall not
revoke the appointment. Without affecting any vote previously taken, the person
appointing a proxy may revoke a revocable appointment by a later appointment
received by the Corporation, or by giving notice of revocation to the
Corporation in writing or in open meeting.

     A writing appointing a proxy is not revoked by the death or incompetency
of the maker unless, before the vote is taken or the authority granted is
otherwise exercised, written notice of such death or incompetency is received
by the Corporation from the executor or administrator of the estate of such
maker or from the fiduciary having control of the shares in respect of which
the proxy was appointed.

     Unless the writing appointing a proxy shall otherwise provide:

     (1)  Each proxy has the power of substitution and, when three (3) or more
          proxies are appointed, a majority of them or of their substitutes may
          appoint one (1) or more substitutes to act for all; and

     (2)  If more than one (1) proxy is appointed, then (a) with respect to
          voting or executing consents, waivers or releases, or objections to
          consents at a shareholders' meeting, a majority of such proxies as
          shall attend the meeting, or if only one (1) attends, then that one
          (1) may exercise all the voting and consenting authority thereat; and
          if one (1) or more do attend and a majority do not agree on any
          particular issue, each proxy so attending shall be entitled to
          exercise such authority with respect to an equal number of shares;
          and (b) with respect to exercising any other authority, a majority
          may act for all.

     Section 11. Action Without Meeting

     Any action which may be authorized or taken at a meeting of the
shareholders may be authorized or taken without a meeting with the affirmative
vote or approval of, and in a writing or writings signed by all the
shareholders who would be entitled to notice of a meeting of the shareholders
held for such


                                       5



purpose, which writing or writings shall be filed with or entered upon the
records of the Corporation.

     Section 12. Accounts and Reports to Shareholders

     The Corporation shall keep correct and complete books and records of
account, together with minutes of the proceedings of its incorporators,
shareholders, Directors and committees of the Directors and records of its
shareholders showing their names and addresses and the number and class of
shares issued or transferred of record to or by them from time-to-time.

     At the annual meeting of shareholders, or the meeting held in lieu
thereof, the Corporation shall lay before the shareholders a financial
statement consisting of a balance sheet and a statement of profit and loss and
surplus in the form required by law. The financial statement shall have
appended thereto an opinion in the form required by law. Upon the written
request of any shareholder made within sixty (60) days after notice of any such
meeting shall have been given, the Corporation, not later than the fifth (5th)
day after receiving such request or the fifth (5th) day before such meeting,
whichever shall be the later date, shall mail to such shareholder a copy of
such financial statement.

     Any shareholder of the Corporation, upon written demand stating the
specific purpose thereof, shall have the right to examine, in person or by
agent or attorney, at any reasonable time and for any reasonable and proper
purpose, the Articles of the Corporation, its Regulations, its books and
records of account, minutes and records of shareholders aforesaid, and voting
trust agreements, if any, on file with the Corporation, and to make copies or
extracts thereof.

                                  ARTICLE III

                               BOARD OF DIRECTORS

     Section 1. Number and Classification of Directors

     The number of Directors of the Corporation, none of whom need be
shareholders, shall be not less than three (3) nor more than ten (10).
Initially, the number of Directors of the Corporation shall be fixed at three
(3). By the majority vote of the Directors then in office, the number of
persons which shall constitute the Board of Directors for the ensuing year
shall be fixed, and may from time-to-time be increased or decreased.

     The Board of Directors shall be and is divided into three (3) classes.
Each Director shall serve for a term ending on the date of the third annual
meeting following the annual meeting at which such Director was elected;
provided, however, that each initial Director in Class I shall hold office
until the annual


                                       6



meeting of Shareholders in 1996, and each initial Director in Class II shall
hold office until the annual meeting of Shareholders in 1997. Elections of
Directors need not be by ballot unless the Regulations so provide. Until
otherwise so increased or decreased, each class shall consist of the Directors
initially specified in Article FIFTH of the Articles. No reduction in the
number of directors of any class shall have the effect of removing any director
of any class prior to the expiration of his term of office.

     In the event of any increase or decrease in the authorized number of
Directors: (i) each Director then serving as such shall nevertheless continue
as a Director of the class of which he or she is a member until the expiration
of his or her current term, or his or her prior death, retirement, resignation,
or removal; and (ii) the newly created or eliminated directorships resulting
from such increase or decrease shall be apportioned by the Board of Directors
among the three (3) classes of Directors as to maintain such classes as nearly
equal as possible.

     Each person elected a Director of the Corporation shall qualify as such by
either (1) accepting in writing his election as a Director, (2) being present
and acting as a Director in a duly called meeting of the Board of Directors, or
(3) acting as a Director by signing a writing to take action without a meeting.

     Section 2. Election of Directors

     The Directors shall be elected at the annual meeting of the shareholders
or, if not so elected, at a special meeting of the shareholders called for that
purpose. Such election shall be by ballot whenever requested by any Shareholder
entitled to vote at such election; provided, that unless such a request is
made, the election may be conducted in any manner approved at such meeting. At
any such meeting of Shareholders for the election of Directors, the persons
receiving the greatest number of votes shall be the Directors.

     Only persons who are nominated in accordance with the following procedures
shall be eligible for election as Directors of the Corporation. Nominations for
the election of Directors may be made by the Board of Directors or by any
Shareholder entitled to vote for the election of Directors. Such nominations,
other than those made by or on behalf of the Board of Directors, shall be made
in writing, hand delivered or mailed by first class United States Mail, postage
prepaid, to the secretary of the Corporation not less than fourteen (14) days
nor more than fifty (50) days prior to any meeting of the Shareholders called
for the election of Directors; provided, however, that if less than twenty-one
(21) days notice of the meeting is given to Shareholders, such written notice
shall be delivered or mailed, as proscribed, to the secretary of the
Corporation not later than the close of the seventh day following the day on
which notice of the meeting was mailed to Shareholders.


                                       7



     To be in proper written form, a Shareholder's notice to the secretary must
set forth (a) as to each person whom the Shareholder proposes to nominate for
election as a Director (i) the name, age, business address and residence of the
person, (ii) the principal occupation or employment of the person, (iii) the
class or series and number of shares of capital stock of the Corporation that
is owned beneficially or of record by such person, and (iv) any other
information relating to such person that would be required to be disclosed in a
proxy statement or other filing required to be made in connection with
solicitations of proxies for election of directors pursuant to Section 14 of
the Securities Exchange Act of 1934, as amended, and the rules and regulation
promulgated thereunder (the "Exchange Act"), and (b) as to the Shareholder
giving the notice (i) the name and record address of such Shareholder, (ii) the
class or series and number of shares of capital stock of the Corporation that
is owned beneficially or of record by such Shareholder, (iii) a description of
all arrangements or understandings between such Shareholder and each proposed
nominee and any other person or persons (including their names) pursuant to
which the nomination(s) are to be made by such Shareholder, (iv) a
representation that such Shareholder intends to appear in person or by proxy at
the meeting to nominate the person's named in its notice, and (v) any other
information relating to such Shareholder that would be required to be disclosed
in a proxy statement or other filing required to be made in connection with
solicitations of proxies for election of directors pursuant to Section 14 of
the Exchange Act. Such notice must be accompanied by a written consent of each
proposed nominee to being named as a nominee and to serve as a director if
elected.

     The Chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with the
foregoing procedure, and if he should so determine, the defective nomination
shall be disregarded.

     Section 3. Term of Office

     Notwithstanding any of the foregoing provisions of this Article III, each
director shall serve until his or her successor is elected and qualified or
until his or her death, retirement, resignation or removal. Should a vacancy
occur or be created, whether arising through death, resignation or removal of a
director or through an increase in the number of directors of any class, such
vacancy shall be filled by action of a majority of the Directors in office. A
director so elected to fill a vacancy shall serve for the remainder of the then
present term of office of the class to which he or she was elected.

     Section 4. Removal

     Directors of the Corporation shall only be removed by the shareholders for
cause. "Cause" for the removal of a director by the shareholders shall exist
only


                                       8



upon the occurrence of one (1) of the following events: (1) the conviction
of the director of a felony; or (2) a finding by a court of law that the
director has been or is guilty of negligence or misconduct in the performance
of his duties as a director of the Corporation. A majority of the directors may
remove a director with or without cause.

     Section 5. Meetings

     The annual meeting of the Board of Directors shall be held immediately
after the annual meeting of the shareholders and such meeting may be held
without further notice.

     Other meetings of the Directors may be called by the Chairman of the
Board, the Chief Executive Officer, the President, any Vice-President or any
two (2) Directors.

     Meetings of the Directors may be held at any place within or without the
State of Ohio, and may be held through any communications equipment that
permits all persons participating to hear each other, and participation through
any such communications equipment shall constitute presence at such meeting.

     Written notice of the time and place of each meeting of the Directors,
other than the annual meeting, shall be given to each Director, either by
personal delivery or by mail, telegram, cablegram, facsimile or any other
method reasonably designed to lead to the receipt of actual notice, at least
two (2) days before the meeting, which notice need not specify the purposes of
the meeting. Such notice may be waived in writing either before or after the
holding of such meeting. Such writing may be given by personal delivery or by
mail, telegram, cablegram facsimile or any other method reasonably designed to
lead to the receipt of actual notice. The attendance of any Director at any
such meeting without protesting, prior to or at the announcement of the
meeting, the lack of proper notice shall be deemed to be a waiver by him of
notice of such meeting.

     Section 6. Quorum

     A majority of the total number of Directors elected and serving shall be
necessary to constitute a quorum for a meeting of the Directors. The act of a
majority of Directors present at a meeting at which a quorum shall be present
shall be the act of the Board of Directors. If at any meeting there shall be
less than a quorum present, the majority of those present may adjourn the
meeting from time-to-time without notice, other than announcement at the
meeting, until a quorum shall attend.


                                       9



     Section 7. Fixing of Record Dates

     The Board of Directors may fix a date, which shall not be a past date, not
exceeding sixty (60) days preceding any dividend or distribution payment date
or any date for the receipt or exercise of rights of purchase of, or
subscription for, or exchange or conversion of, shares or other securities,
subject to contract rights with respect thereto, or any date for the
participation in the execution of written consents, waivers or releases, as a
record date for the determination of the shareholders entitled to receive such
dividends or distributions, receive or exercise such rights or participate in
the execution of such consents, waivers or releases and/or the Board of
Directors may close the books of the Corporation against transfers of shares
during the whole or any part of such period.

     Section 8. Committees

     The Board of Directors may from time-to-time create an Executive Committee
and/or any other committee(s) of the Directors, to consist of not less than
three (3) Directors, and may authorize the delegation to any such committee of
any of the authority of the Directors, however conferred, other than that of
filling vacancies among the Directors or in any committee of the Directors.

     The Directors may appoint one (1) or more Directors as alternate members
of any such committee, who may take the place of any absent member or members
at any meeting of such committee.

     Each such committee shall serve at the pleasure of the Directors, shall
act only in the intervals between meetings of the Directors and shall be
subject to the control and direction of the Directors.

     A majority of the total number of committee members shall be necessary to
constitute a quorum for a meeting of any such committee. The act of a majority
of committee members present at a meeting at which a quorum shall be present
shall be the act of such committee. Any such committee may also act by a
writing or writings signed by all of its members.

     An act or authorization of an act by any such committee within the
authority delegated to it shall be as effective for all purposes as the act or
authorization of the Directors.

     Section 9. Compensation

     The Board of Directors shall fix the compensation of the Chairman of the
Board and of the President and shall fix or authorize the President or a
Compensation Committee to fix the compensation of any or all other officers.
The Board of Directors may allow compensation to members of any committee and


                                      10



may vote compensation to any Director for attendance at meetings or for any
special services.

     Section 10. Action Without Meeting

     Any action which may be authorized or taken at a meeting of the Directors
may be authorized or taken without a meeting with the affirmative vote or
approval of, and in a writing or writings signed by, all the Directors, which
writing or writings shall be filed with or entered upon the records of the
Corporation.

                                   ARTICLE IV

                                    OFFICERS

     Section 1. Officers

     The Corporation may have a Chairman of the Board of Directors and shall
have a President, a Secretary, and a Treasurer, all of whom shall be chosen by
the Board of Directors. The Corporation may also have a Chief Executive
Officer, Vice-Chairman of the Board or Executive Vice-President, one (1) or
more Vice-Presidents, Assistant Secretaries, Assistant Treasurers and such
other officers as the Board may deem necessary, all of whom shall be chosen by
the Board of Directors or by an officer or officers designated by it. The
Chairman and Vice-Chairman of the Board shall be, but the other officers may
but need not be, a member of the Board of Directors. Each officer shall hold
office until his successor shall be chosen and qualified, unless otherwise
specified by the Board of Directors. Any officer shall be subject to removal,
with or without cause, at any time by the vote of a majority of the Board of
Directors.

     Any two (2) or more offices may, in the discretion of the Board of
Directors, be held at the same time by the same person. However, no officer
shall execute, acknowledge or verify any instrument in more than one (1)
capacity if such instrument shall be required by law or by the Regulations or
by-laws to be executed, acknowledged or verified by any two (2) or more
officers.

     Section 2. Chairman of the Board

     The Chairman of the Board shall have the authority to preside at all
meetings of the shareholders and of the Board of Directors, and shall have such
other duties and powers as may be assigned to or vested in him by the Board of
Directors or the Executive Committee.


                                      11



     Section 3. Vice-Chairman of the Board

     If such office is created by the Board of Directors, the Vice-Chairman of
the Board shall have such powers and perform such duties as may from
time-to-time be delegated to him by the Chairman of the Board and shall have
such other powers and perform such other duties as are provided in these
Regulations as they may from time-to-time be assigned to him or vested in him
by the Board of Directors or the Executive Committee. In the absence of the
Chairman of the Board, the Vice-Chairman of the Board shall have the authority
to preside at all meetings of the shareholders and of the Board of Directors.

     Section 4. Chief Executive Officer

     The Chief Executive Officer shall have general charge and supervision of
the business of the Corporation. In the absence of the Chairman of the Board
and the Vice Chairman of the Board, if any, the Chief Executive Officer shall
preside at all meetings of the Board of Directors and of the shareholders. He
shall have such other powers and perform such other duties as are provided in
these Regulations and as may from time-to-time be assigned to him by the Board
of Directors or the Executive Committee.

     Section 5. The President

     The President shall, in the absence, disability or inability to act of the
Chief Executive Officer, exercise all powers and perform all duties of the
Chief Executive Officer, and shall have such other powers and perform such
other duties as are provided in these Regulations and as may from time-to-time
be assigned to him by the Board of Directors, the Executive Committee or the
Chief Executive Officer.

     Section 6. Chief Operating Officer

     The Chief Operating Officer shall have such powers and perform such other
duties as are provided in these Regulations and as may from time-to-time be
assigned to or vested in him by the Board of Directors, the Executive
Committee, the President or the Chief Executive Officer.

     Section 7. Vice-Presidents

     The Executive Vice-President, or, if there be none, the Vice-Presidents,
in the order of their seniority by designation (or, if not designated, in the
order of their seniority of election), shall perform the duties of the
President in his absence or during his disability to act. The Executive
Vice-President and the Vice-Presidents shall have such other duties and powers
as may be assigned to or


                                      12



vested in them by the Board of Directors, the Executive Committee, the
President, or the Chief Executive Officer.

     Section 8. The Secretary

     The Secretary shall issue notices of all meetings for which notice shall
be required to be given; shall keep the minutes of all meetings; shall have
charge of the corporate seal, if any, and corporate record books; shall cause
to be prepared for each meeting of shareholders the list of shareholders
entitled to vote thereat; and shall have such other duties and powers as may be
assigned to or vested in him by the Board of Directors, the Executive
Committee, the President or the Chief Executive Officer.

     Section 9. The Treasurer

     The Treasurer shall have the custody of all monies and securities of the
Corporation and shall keep adequate and correct accounts of the Corporation's
business transactions, including accounts of its assets, liabilities, receipts,
disbursements, gains, losses, stated capital and shares; shall prepare and lay
before the shareholders' meetings the data referred to in Section 12 of Article
II hereof; and shall mail copies of such data as required in said Section to
any shareholder requesting same. The funds of the Corporation shall be
deposited in the name of the Corporation by the Treasurer in such depositaries
as the Board of Directors may from time-to-time designate. The Treasurer shall
have such other duties and powers as may be assigned to or vested in him by the
Board of Directors, the Executive Committee, the President or the Chief
Executive Officer.

     Section 10. Other Officers

     Other officers of the Corporation shall have such duties and powers as may
be assigned to or vested in them by the Board of Directors, the Executive
Committee, the President or the Chief Executive Officer.

     Section 11. Authority to Sign

     Except as otherwise specifically provided by the Board of Directors or by
the Executive Committee, checks, notes, drafts, contracts or other instruments
authorized by the Board of Directors or by the Executive Committee shall be
executed and delivered on behalf of the Corporation by the Chief Executive
Officer, President, the Treasurer or a Vice-President and by the Secretary,
Assistant Secretary or an Assistant Treasurer.

     Section 12. When Duties of Officers May be Delegated

     The Board of Directors may, for any reason that may seem sufficient to the
Board, and effective for such length of time which may be unlimited, as the


                                      13



Board may determine, delegate any or all of the duties and powers of the
Corporation to any other officer.

                                   ARTICLE V

                                  CERTIFICATES

     Section 1. Certificates

     The certificates representing shares of the Corporation shall be in such
form, consistent with law, as shall be approved by the Board of Directors.

     Section 2. Transfer and Registration

     The Board of Directors shall have authority to make such rules and
regulations, not inconsistent with law, the Articles or these Regulations, as
it may deem expedient concerning the issuance, transfer and registration of
shares and the issuance and transfer of certificates evidencing such shares and
may appoint transfer agents and registrars of such shares.

     Transfer books may be kept in any state of the United States or in any
foreign country for the purposes of transferring shares issued by the
Corporation; but if no transfer agent shall be appointed to act in this state,
the Corporation shall keep an office in this state at which shares shall be
transferable and at which it shall keep books in which shall be recorded the
names and addresses of all shareholders and all transfers of shares.

     Section 3. Substituted Certificates

     Any person claiming a certificate for shares alleged to have been lost,
stolen or destroyed shall make an affidavit or affirmation of the fact, give
the Corporation and its registrar or registrars and its transfer agent or
agents a bond or indemnity satisfactory to the Board and, if required by the
Board of Directors, advertise the same in such manner as the Board of Directors
may require; whereupon, a new certificate may be issued of the same tenor and
for the same number of shares as the one alleged to have been lost, stolen or
destroyed.

                                   ARTICLE VI

                     RESIGNATIONS OF DIRECTORS AND OFFICERS

     Any Director or officer shall resign at any time by delivering written
notice to the Corporation. Any such resignation shall take effect immediately
or at such other time as may be specified therein. Unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.


                                      14



                                  ARTICLE VII

            INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, ETC,

     (1) The Corporation may indemnify or agree to indemnify any person who was
or is a party, or is threatened to be made a party, to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, other than an action by or in the right of the
Corporation, by reason of the fact that he is or was a Director, officer,
employee or agent of the Corporation, or is or was serving at the request of
the Corporation as a director, trustee, officer, employee, member, manager or
agent of another corporation, domestic or foreign, nonprofit or for profit, a
limited liability company, partnership, joint venture, trust or other
enterprise, against expenses, including attorneys' fees actually and reasonably
incurred by him in connection with such action, suit or proceeding, judgments,
fines and amounts paid in settlement, if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal action or proceeding, if he had
no reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, or conviction, or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create
a presumption that the person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal action or proceeding, he had
reasonable cause to believe that his conduct was unlawful.

     (2) The Corporation shall indemnify or agree to indemnify any person who
was or is a party, or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the Corporation to
procure a judgment in its favor by reason of the fact that he is or was a
Director, officer, employee, member, manager or agent of the Corporation, or
is, or was serving at the request of the Corporation as a director, trustee,
officer, employee or an agent of another corporation, domestic or foreign,
nonprofit or for profit, a limited liability company, partnership, joint
venture, trust or other enterprise against expenses, including attorneys' fees,
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation, except that no indemnification shall be made in respect of (i) any
claim, issue or matter as to which such person is adjudged to be liable for
negligence or misconduct in the performance of his duty to the Corporation
unless, and only to the extent that the court of common pleas, or the court in
which such action or suit was brought, determines upon application that,
despite the adjudication of liability, but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses as the court of common pleas or such other court shall deem proper; or
(ii) any


                                      15



action or suit in which the only liability asserted against a Director is
pursuant to Section 1701.95 of the Ohio Revised Code.

     (3) To the extent that a Director, trustee, officer, employee, member,
manager or agent has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in division (1) or (2) of this
ARTICLE VII, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses, including attorneys' feed actually and reasonably
incurred by him in connection with the action, suit or proceeding.

     (4) Any indemnification under division (1) or (2) of this ARTICLE VII,
unless ordered by a court, shall be made by the Corporation only as authorized
in the specific case upon a determination that indemnification of the director,
trustee, officer, employee, member, manager or agent is proper in the
circumstances because he has met the applicable standard of conduct set forth
in divisions (1) and (2) of this ARTICLE VII. Such determination shall be made
(a) by a majority vote of a quorum consisting of Directors of the Corporation
who were not and are not parties to or threatened with any such action, suit or
proceeding; or (b) if such a quorum is not obtainable or if a majority vote of
a quorum of disinterested Directors so directs, in a written opinion by
independent legal counsel other than-an attorney, or a firm having associated
with it an attorney, who has been retained by or who has performed services for
the Corporation or any person to be indemnified within the past five (5) years;
or (c) by the shareholders; or (d) by the court of common pleas or the court in
which such action, suit or proceeding was brought. Any determination made by
the disinterested Directors under division (4)(a) or by independent legal
counsel under division (4)(b) of this ARTICLE VII shall be promptly
communicated to the person who threatened or brought the action or suit, by or
in the right of the Corporation under division (2) of this ARTICLE VII, and
within ten (10) days after receipt of such notification, such person shall have
the right to petition the court of common pleas or the court in which such
action or suit was brought to review the reasonableness of such determination.

     (5)(a) Unless the only liability asserted against a Director in any
action, suit or proceeding referred to in divisions (1) and (2) of this ARTICLE
VII is pursuant to Section 1701.95 of the Ohio Revised Code, expenses,
including attorneys' fees, incurred by a Director in defending the action, suit
or proceeding shall be paid by the Corporation as they are incurred, in advance
of the final disposition of the action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the Director in which he agrees to (i) repay
such amount if it is proved by clear and convincing evidence in a court of
competent jurisdiction that his action or failure to act involved an act or
omission undertaken with deliberate intent to cause injury to the Corporation
or undertaken with reckless disregard for the best interests of the
Corporation; and (ii) reasonably cooperate with the Corporation concerning the
action, suit or proceeding.


                                      16



     (5)(b) Expenses, including attorneys' fees, incurred by a Director,
trustee, officer, employee, member, manager or agent in defending any action,
suit or proceeding referred to in division (1) or (2) of this ARTICLE VII may
be paid by the Corporation as they are incurred, in advance of the final
disposition of the action, suit or proceeding as authorized by the Directors in
the specific case upon the receipt of an undertaking by or on behalf of the
director, trustee, officer, employee, member, manager or agent to repay such
amount, if it ultimately is determined that he is not entitled to be
indemnified by the Corporation as authorized in this ARTICLE VII.

     (6) The indemnification provided in this ARTICLE VII shall not be deemed
exclusive of, and shall be in addition to, any other rights to which those
seeking indemnification may be entitled under the Articles of Incorporation or
the Code of Regulations or any agreement, vote of shareholders or disinterested
Directors, or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to
a person who has ceased to be a Director, trustee, officer, employee, member,
manager or agent and shall inure to the benefit of the heirs, executors and
administrators of such a person.

     (7) A Director shall be liable in damages for any action he takes or fails
to take as a Director only if it is proved by clear and convincing evidence in
a court of competent jurisdiction that his action or failure to act involved an
act or omission undertaken with deliberate intent to cause injury to the
Corporation or undertaken with reckless disregard for the best interests of the
Corporation. Nothing contained in this ARTICLE VII affects the liability of a
Director under Section 1701.95 of the Ohio Revised Code or limits relief
available under Section 1701.60 of the Ohio Revised Code.

     (8) The Corporation may purchase and maintain insurance or furnish similar
protection, including but not limited to, trust funds, letters of credit or
self-insurance, on behalf of or for any person who is or was a Director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, trustee, officer, employee, member or
manager or agent of another corporation, domestic or foreign, nonprofit or for
profit, a limited liability company, partnership, joint venture, trust or other
enterprise against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
Section 1701.13(E) of the Ohio Revised Code. Insurance may be purchased from or
maintained with a person in which the Corporation has a financial interest.

     (9) As used in this ARTICLE VII, references to "Corporation" or
"corporation" include all constituent entities in a consolidation or merger and
the new or surviving corporation, so that any person who is or was a director,
officer,


                                      17



employee, or trustee, member, manager or agent of such a constituent entity, or
is or was serving at the request of such constituent entity as a director,
trustee, officer, employee, member, manager or agent of another corporation,
domestic or foreign, nonprofit or for profit, a limited liability company,
partnership, joint venture, trust or other enterprise shall stand in the same
position under this ARTICLE VII with respect to the new or surviving
corporation as he would if he had served the new or surviving corporation in
the same capacity.

                                  ARTICLE VIII

                                 MISCELLANEOUS

     Section 1. Voting Shares Held by the Corporation

     Unless otherwise ordered by the Board of Directors, the Treasurer, in
person or by proxy or proxies appointed by him, shall have full power and
authority on behalf of the Corporation to vote, act and consent with respect to
any shares issued by other corporations which the Corporation may own.

     The Corporation shall not directly or indirectly vote any shares issued by
it.

     Section 2. Redemption or Repurchase of Share

     The Corporation may purchase from time to time shares of any class issued
by it, upon agreement with the holder thereof. Such purchases may be made
either in the open market or at private or public sale, in such manner and
amount, from the holder or holders of outstanding shares of the Corporation,
and at such prices and upon such terms as the Board of Directors shall, from
time to time, determine. Unless a different procedure is established in a
written agreement among the Corporation and all of the shareholders of the
Corporation, the Board of Directors is hereby empowered to authorize such
purchases from time to time without any vote of the holders of any class of
shares authorized and outstanding at the time of any such purchases.

     Section 3. Seal

     The Corporation shall have no seal.

     Section 4. Amendment

     These Regulations may be amended by the affirmative vote or the written
consent of the holders of shares entitling them to exercise a majority of the
voting power of the Corporation.


                                      18





                                   EXHIBIT D
               to First Amended Chapter 11 Plan of Reorganization
               --------------------------------------------------

                                 New Indenture
                                 -------------




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








                      ADVANCED LIGHTING TECHNOLOGIES, INC.,
                                                        Issuer

                                       and

                             [--------------------],
                                                        Trustee




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

                                    Indenture

                          Dated as of _________________

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

                            __% Senior Notes due 2010










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






                              CROSS-REFERENCE TABLE

TIA Sections                                                 Indenture Sections

ss.310(a)(1)................................................................7.10
       (a)(2).............................................................. 7.10
       (b)............................................................7.03; 7.08
ss.311(a)...................................................................7.03
       (b)..................................................................7.03
ss.312(a)...................................................................2.03
       (b).................................................................10.02
       (c).................................................................10.02
ss.313(a)...................................................................7.06
       (b)(2)...............................................................7.07
       (c).....................................................7.05; 7.06; 10.02
       (d)..................................................................7.06
ss.314(a)............................................................7.05; 10.02
       (a)(4)........................................................4.16; 10.02
       (c)(1)..............................................................10.03
       (c)(2)..............................................................10.03
       (e)...........................................................4.16; 10.04
ss.315(a)...................................................................7.02
       (b)...........................................................7.05; 10.02
       (c)..................................................................7.02
       (d)..................................................................7.02
       (e)..................................................................6.11
ss.316(a)(1)(A).............................................................6.05
       (a)(1)(B)............................................................6.04
       (b)..................................................................6.07
       (c)..................................................................9.03
ss.317(a)(1)................................................................6.08
       (a)(2)...............................................................6.09
       (b)..................................................................2.04
ss.318(a)..................................................................10.01
       (c).................................................................10.01

Note: The Cross-Reference Table shall not for any purpose be deemed to be a part
      of this Indenture.






                                       i

                               TABLE OF CONTENTS
                               -----------------

                                                                                                               
                                                                                                                Page
ARTICLE ONE  DEFINITIONS AND INCORPORATION BY REFERENCE                                                           1

     SECTION 1.01.         Definitions............................................................................1

     SECTION 1.02.         Incorporation by Reference of Trust Indenture Act.....................................19

     SECTION 1.03.         Rules of Construction.................................................................19

ARTICLE TWO  THE NOTES                                                                                           19

     SECTION 2.01.         Form and Dating.......................................................................19

     SECTION 2.03.         Execution, Authentication and Denominations...........................................20

     SECTION 2.04.         Registrar and Paying Agent............................................................20

     SECTION 2.05.         Paying Agent to Hold Money in Trust...................................................21

     SECTION 2.06.         Transfer and Exchange.................................................................22

     SECTION 2.09.         Replacement Notes.....................................................................22

     SECTION 2.10.         Outstanding Notes.....................................................................23

     SECTION 2.11.         Temporary Notes.......................................................................23

     SECTION 2.12.         Cancellation..........................................................................23

     SECTION 2.13.         CUSIP Numbers.........................................................................23

     SECTION 2.14.         Defaulted Interest....................................................................24


ARTICLE THREE REDEMPTION                                                                                         24

     SECTION 3.01.         Right of Redemption...................................................................24

     SECTION 3.02.         Notices to Trustee....................................................................24

     SECTION 3.03.         Selection of Notes to Be Redeemed.....................................................24

     SECTION 3.04.         Notice of Redemption..................................................................25


- ---------
Note: The Table of Contents shall not for any purposes be deemed to be a part
      of this Indenture.



                                       ii


     SECTION 3.05.         Effect of Notice of Redemption........................................................26

     SECTION 3.06.         Deposit of Redemption Price...........................................................26

     SECTION 3.07.         Payment of Notes Called for Redemption................................................26

     SECTION 3.08.         Notes Redeemed in Part................................................................26


ARTICLE FOUR  COVENANTS                                                                                          26

     SECTION 4.01.         Payment of Notes......................................................................26

     SECTION 4.02.         Maintenance of Office or Agency.......................................................27

     SECTION 4.03.         Limitation on Indebtedness............................................................27

     SECTION 4.04.         Limitation on Restricted Payments.....................................................29

     SECTION 4.05.         Limitation on Dividend and Other Payment Restrictions Affecting
                           Restricted Subsidiaries...............................................................31

     SECTION 4.06.         Limitation on the Issuance and Sale of Capital Stock of Restricted....................32

     SECTION 4.07.         Limitation on Issuances of Guarantees by Restricted Subsidiaries.......................32

     SECTION 4.08.         Limitation on Transactions with Shareholders and Affiliates...........................33

     SECTION 4.09.         Limitation on Liens...................................................................33

     SECTION 4.10.         Limitation on SaleLeaseback Transactions.............................................34

     SECTION 4.11.         Limitation on Asset Sales.............................................................34

     SECTION 4.12.         Repurchase of Notes upon a Change of Control..........................................36

     SECTION 4.13.         Existence.............................................................................36

     SECTION 4.15.         Payment of Taxes and Other Claims.....................................................36

     SECTION 4.15.         Maintenance of Properties and Insurance...............................................36

     SECTION 4.16.         Notice of Defaults....................................................................37

     SECTION 4.17.         Compliance Certificates...............................................................37

     SECTION 4.19.         Waiver of Stay, Extension or Usury Laws...............................................38



                                       iii


ARTICLE FIVE  SUCCESSOR CORPORATION                                                                              38

     SECTION 5.01.         When Company May Merge, Etc...........................................................38

     SECTION 5.02.         Successor Substituted.................................................................39


ARTICLE SIX  DEFAULT AND REMEDIES                                                                                39

     SECTION 6.01.         Events of Default.....................................................................39

     SECTION 6.02.         Acceleration..........................................................................40

     SECTION 6.03.         Other Remedies........................................................................41

     SECTION 6.04.         Waiver of Past Defaults...............................................................41

     SECTION 6.05.         Control by Majority...................................................................41

     SECTION 6.06.         Limitation on Suits...................................................................42

     SECTION 6.07.         Rights of Holders to Receive Payment..................................................42

     SECTION 6.08.         Collection Suit by Trustee............................................................42

     SECTION 6.09.         Trustee May File Proofs of Claim......................................................43

     SECTION 6.10.         Priorities............................................................................43

     SECTION 6.11.         Undertaking for Costs.................................................................43

     SECTION 6.12.         Restoration of Rights and Remedies....................................................44

     SECTION 6.13.         Right and Remedies Cumulative.........................................................44

     SECTION 6.14.         Delay or Omission Not Waiver..........................................................44


ARTICLE SEVEN  TRUSTEE                                                                                           44

     SECTION 7.01.         General...............................................................................44

     SECTION 7.02.         Certain Rights of Trustee.............................................................44

     SECTION 7.03.         Individual Rights of Trustee..........................................................46

     SECTION 7.04.         Trustee's Disclaimer..................................................................46

     SECTION 7.05.         Notice of Default.....................................................................46

     SECTION 7.06.         Reports by Trustee to Holders.........................................................46



                                       iv


     SECTION 7.07.         Compensation and Indemnity............................................................46

     SECTION 7.08.         Replacement of Trustee................................................................47

     SECTION 7.09.         Successor Trustee by Merger, Etc......................................................48

     SECTION 7.10.         Eligibility...........................................................................48

     SECTION 7.11.         Money Held in Trust...................................................................48


ARTICLE EIGHT  DISCHARGE OF INDENTURE                                                                            49

     SECTION 8.01.         Termination of Company's Obligations..................................................49

     SECTION 8.02.         Defeasance and Discharge of Indenture.................................................49

     SECTION 8.03.         Defeasance of Certain Obligations.....................................................51

     SECTION 8.04.         Application of Trust Money; Miscellaneous.............................................53

     SECTION 8.05.         Repayment to Company..................................................................53

     SECTION 8.06.         Reinstatement.........................................................................53


ARTICLE NINE  AMENDMENTS, SUPPLEMENTS AND WAIVERS                                                                54

     SECTION 9.01.         Without Consent of Holders............................................................54

     SECTION 9.02.         With Consent of Holders...............................................................54

     SECTION 9.03.         Revocation and Effect of Consent......................................................55

     SECTION 9.04.         Notation on or Exchange of Notes......................................................56

     SECTION 9.05.         Trustee to Sign Amendments, Etc.......................................................56

     SECTION 9.06.         Conformity with Trust Indenture Act...................................................56


ARTICLE TEN MISCELLANEOUS                                                                                        56

     SECTION 10.01.        Trust Indenture Act of 1939...........................................................56

     SECTION 10.02.        Notices...............................................................................56

     SECTION 10.03.        Certificate and Opinion as to Conditions Precedent....................................57

     SECTION 10.04.        Statements Required in Certificate or Opinion.........................................58

     SECTION 10.05.        Rules by Trustee, Paying Agent or Registrar...........................................58



                                       v


     SECTION 10.06.        Payment Date Other Than a Business Day................................................58

     SECTION 10.07.        Governing Law.........................................................................58

     SECTION 10.08.        No Adverse Interpretation of Other Agreements.........................................58

     SECTION 10.09.        No Recourse Against Others............................................................58

     SECTION 10.10.        Successors............................................................................59

     SECTION 10.11.        Duplicate Originals...................................................................59

     SECTION 10.12.        Separability..........................................................................59

     SECTION 10.13.        Table of Contents, Headings, Etc......................................................59


EXHIBIT A        Form of Note                                                                                   61

EXHIBIT A        Form of Note...................................................................................A-1








        INDENTURE, dated as of ___________________, 2003, between ADVANCED
LIGHTING TECHNOLOGIES, INC., an Ohio corporation (the "Company"), and
[_____________________], a[n] [________________], trustee (the "Trustee").
- -------- -------


                                    RECITALS

         The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of up to $[______________], , as defined
herein, in aggregate principal amount of the Company's __% Senior Notes due 2010
(the "Notes") issuable as provided in this Indenture. All things necessary to
make this Indenture a valid agreement of the Company, in accordance with its
terms, have been done, and the Company has done all things necessary to make the
Notes, when executed by the Company and authenticated and delivered by the
Trustee hereunder and duly issued by the Company, valid obligations of the
Company as hereinafter provided.



        The Notes will be issued in connection with the Joint Chapter 11 Plan of
Reorganization (the "Plan") of the Company and certain of its United States
subsidiaries approved by the United States Bankruptcy Court for the Northern
District of Illinois, Eastern District on ___________, 2003. Each Note initially
issued will constitute the consideration exchanged for a Class 3 Claim, and the
aggregate principal amount of Notes will equal $[___________] in respect of the
Allowed Class3 Claims under the Plan.


         This Indenture is subject to, and shall be governed by, the provisions
of the Trust Indenture Act of 1939, as amended, that are required to be a part
of and to govern indentures qualified under the Trust Indenture Act of 1939, as
amended.

                      AND THIS INDENTURE FURTHER WITNESSETH

         For and in consideration of the premises and the purchase of the Notes
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders, as follows.

                                  ARTICLE ONE
                   DEFINITIONS AND INCORPORATION BY REFERENCE

         SECTION 1.01.  Definitions.

         "Acquired Indebtedness" means Indebtedness of a Person existing at the
time such Person becomes a Restricted Subsidiary or assumed in connection with
an Asset Acquisition by a Restricted Subsidiary and not Incurred in connection
with, or in anticipation of, such Person becoming a Restricted Subsidiary or
such Asset Acquisition; provided that Indebtedness of such Person which is
redeemed, defeased, retired or otherwise repaid at the time of or immediately
upon consummation of the transactions by which such Person becomes a Restricted
Subsidiary or such Asset Acquisition shall not be Acquired Indebtedness.




                                       2

         "Adjusted Consolidated Net Income" means, for any period, the aggregate
net income (or loss) of the Company and its Restricted Subsidiaries for such
period determined in conformity with GAAP; provided that the following items
shall be excluded in computing Adjusted Consolidated Net Income (without
duplication): (i) the net income of any Person that is not a Restricted
Subsidiary, except to the extent of the amount of dividends or other
distributions actually paid to the Company or any of its Restricted Subsidiaries
by such Person during such period; (ii) solely for the purposes of calculating
the amount of Restricted Payments that may be made pursuant to clause (C) of the
first paragraph of Section 4.04 (and in such case, except to the extent
includable pursuant to clause (i) above), the net income (or loss) of any Person
accrued prior to the date it becomes a Restricted Subsidiary or is merged into
or consolidated with the Company or any of its Restricted Subsidiaries or all or
substantially all of the property and assets of such Person are acquired by the
Company or any of its Restricted Subsidiaries; (iii) the net income of any
Restricted Subsidiary to the extent that the declaration or payment of dividends
or similar distributions by such Restricted Subsidiary of such net income is not
at the time permitted by the operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Restricted Subsidiary; (iv) any gains or losses
(on an after-tax basis) attributable to Asset Sales; (v) except for purposes of
calculating , the amount of Restricted Payments that may be made pursuant to
clause (C) of the first paragraph of Section 4.04, any amount paid or accrued as
dividends on Preferred Stock of the Company or any Restricted Subsidiary owned
by Persons other than the Company and any of its Restricted Subsidiaries; and
(vi) all extraordinary gains and extraordinary losses (on an after-tax basis).

         "Adjusted Consolidated Net Tangible Assets" means the total amount of
assets of the Company and its Restricted Subsidiaries (less applicable
depreciation, amortization and other valuation reserves), except to the extent
resulting from write-ups of capital assets (excluding write-ups in connection
with accounting for acquisitions in conformity with GAAP), after deducting
therefrom (i) all current liabilities of the Company and its Restricted
Subsidiaries (excluding intercompany items) and (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangibles, all as set forth on the most recent quarterly or annual
consolidated balance sheet of the Company and its Restricted Subsidiaries,
prepared in conformity with GAAP and filed with the Commission or provided to
the Trustee pursuant to Section 4.18.

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

         "Agent" means any Registrar, Co-Registrar, Paying Agent or
authenticating agent.

         "Asset Acquisition" means (i) an investment by the Company or any of
its Restricted Subsidiaries in any other Person pursuant to which such Person
shall become a Restricted Subsidiary or shall be merged into or consolidated
with the Company or any of its Restricted




                                       3

Subsidiaries; provided that such Person's primary business is related, ancillary
or complementary to the businesses of the Company and its Restricted
Subsidiaries on the date of such investment or (ii) an acquisition by the
Company or any of its Restricted Subsidiaries of the property and assets of any
Person other than the Company or any of its Restricted Subsidiaries that
constitute substantially all of a division or line of business of such Person;
provided that the property and assets acquired are related, ancillary or
complementary to the businesses of the Company and its Restricted Subsidiaries
on the date of such acquisition.

         "Asset Disposition" means the sale or other disposition by the Company
or any of its Restricted Subsidiaries (other than to the Company or another
Restricted Subsidiary) of (i) all or substantially all of the Capital Stock of
any Restricted Subsidiary or (ii) all or substantially all of the assets that
constitute a division or line of business of the Company or any of its
Restricted Subsidiaries.

         "Asset Sale" means any sale, transfer or other disposition (including
by way of merger, consolidation or sale-leaseback transaction) in one
transaction or a series of related transactions by the Company or any of its
Restricted Subsidiaries to any Person other than the Company or any of its
Restricted Subsidiaries of (i) all or any of the Capital Stock of any Restricted
Subsidiary, (ii) all or substantially all of the property and assets of an
operating unit or business of the Company or any of its Restricted Subsidiaries
or (iii) any other property and assets (other than the Capital Stock or other
Investment in an Unrestricted Subsidiary) of the Company or any of its
Restricted Subsidiaries outside the ordinary course of business of the Company
or such Restricted Subsidiary and, in each case, that is not governed by Article
Five; provided that "Asset Sale" shall not include (a) sales or other
dispositions of inventory, receivables and other current assets, (b) sales,
transfers or other dispositions of assets constituting a Restricted Payment
permitted to be made under Section 4.04, or (c) sales or other dispositions of
assets for consideration at least equal to the fair market value of the assets
sold or disposed of, to the extent that the consideration received would satisfy
clause (B) of Section 4.11.

         "Authenticating Agent" means any person engaged to authenticate the
Notes in the stead of the Trustee pursuant to Section 2.02.

         "Average Life" means, at any date of determination with respect to any
debt security, the quotient obtained by dividing (i) the sum of the products of
(a) the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security and (b) the amount
of such principal payment by (ii) the sum of all such principal payments.

         "Board of Directors" means the Board of Directors of the Company or any
committee of such Board of Directors duly authorized to act under this
Indenture.

         "Board Resolution" means a copy of a resolution 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 on the date of such
certification, and delivered to the Trustee.





                                       4

         "Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in The City of New York, or in the city of the Corporate
Trust Office of the Trustee, are authorized by law to close.

         "Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether outstanding on the
Effective Date or issued thereafter, including, without limitation, all Common
Stock and Preferred Stock.

         "Capitalized Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental obligations of such Person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person.

         "Capitalized Lease Obligations" means the discounted present value of
the rental obligations under a Capitalized Lease. "Commission" means the
Securities and Exchange Commission Exchange Commission, as from time to time
constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the TIA, then the body performing such duties at
such time.

         "Change of Control" means such time as (i) (a) a "person" or "group"
(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act) becomes
the ultimate "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act) of more than 35% of the total voting power of the Voting Stock of the
Company on a fully diluted basis and (b) such ownership represents a greater
percentage of the total voting power of the Voting Stock of the Company, on a
fully diluted basis, than may then be voted by the Existing Stockholders on such
date; provided however, that a Change in Control shall not be deemed to have
occurred by reason of the fact that one or more of the Executive Managers become
beneficial owners of more than 35% of the total voting power of the Voting Stock
of the Company on a fully diluted basis; or (ii) individuals who on the
Effective Date (or within 120 days thereafter as contemplated by the Plan)
constitute the Board of Directors (together with any new or successor directors
whose election by the Board of Directors or whose nomination by the Board of
Directors for election by the Company's stockholders was approved by a vote of
at least two-thirds of the members of the Board of Directors on the date of
their election or nomination) cease for any reason to constitute a majority of
the members of the Board of Directors then in office.

         "Common Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's equity, other than Preferred Stock of
such Person, whether outstanding on the Effective Date or issued thereafter,
including, without limitation, all series and classes of such common stock.

         "Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article Five of this
Indenture and thereafter means the successor.





                                       5

         "Company Order" means a written request or order signed in the name of
the Company (i) by its Chairman, a Vice Chairman, its President, Executive Vice
President, Senior Vice President or a Vice President and (ii) by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary and delivered to
the Trustee; provided, however, that such written request or order may be signed
by any two of the officers or directors listed in clause (i) above in lieu of
being signed by one of such officers or directors listed in such clause (i) and
one of the officers listed in clause (ii) above.

         "Consolidated EBITDA" means, for any period, Adjusted Consolidated Net
Income for such period plus, to the extent such amount was deducted in
calculating such Adjusted Consolidated Net Income, (i) Consolidated Interest
Expense, (ii) income taxes (other than income taxes (either positive or
negative) attributable to extraordinary gains or losses or Asset Sales or Asset
Dispositions), (iii) depreciation expense, (iv) amortization expense and (v) all
other non-cash items reducing Adjusted Consolidated Net Income (other than items
that will require cash payments and for which an accrual or reserve is, or is
required by GAAP to be, made), less all non-cash items increasing Adjusted
Consolidated Net Income, all as determined on a consolidated basis for the
Company and its Restricted Subsidiaries in conformity with GAAP; provided that,
if any Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary,
Consolidated EBITDA shall be reduced (to the extent not otherwise reduced in
accordance with GAAP) by an amount equal to (A) the amount of the Adjusted
Consolidated Net Income attributable to such Restricted Subsidiary multiplied by
(B) the percentage ownership interest in the income of such Restricted
Subsidiary not owned on the last day of such period by the Company or any of its
Restricted Subsidiaries.

         "Consolidated Interest Expense" means, for any period, the aggregate
amount of interest in respect of Indebtedness (including, without limitation,
amortization of original issue discount on any Indebtedness and the interest
portion of any deferred payment obligation, calculated in accordance with the
effective interest method of accounting; all commissions, discounts and other
fees and charges owed with respect to letters of credit and bankers' acceptance
financing; the net costs associated with Interest Rate Agreements; and
Indebtedness that is Guaranteed or secured by the Company or any of its
Restricted Subsidiaries) and all but the principal component of rentals in
respect of Capitalized Lease Obligations paid, accrued or scheduled to be paid
or to be accrued by the Company and its Restricted Subsidiaries during such
period; excluding, however, (i) any amount of such interest of any Restricted
Subsidiary if the net income of such Restricted Subsidiary is excluded in the
calculation of Adjusted Consolidated Net Income pursuant to clause (iii) of the
definition thereof (but only in the same proportion as the net income of such
Restricted Subsidiary is excluded from the calculation of Adjusted Consolidated
Net Income pursuant to clause (iii) of the definition thereof) and (ii) any
premiums, fees and expenses (and any amortization thereof) payable in connection
with the offering of the Notes, all as determined on a consolidated basis
(without taking into account Unrestricted Subsidiaries) in conformity with GAAP.

         "Consolidated Net Worth" means, at any date of determination,
stockholders' equity as set forth on the most recently available quarterly or
annual consolidated balance sheet of the Company and its Restricted Subsidiaries
(which shall be as of a date not more than 90 days prior to the date of such
computation and which shall not take into account Unrestricted Subsidiaries),
less any amounts attributable to Disqualified Stock or any equity security
convertible into or




                                       6

exchangeable for Indebtedness, the cost of treasury stock and the principal
amount of any promissory notes receivable from the sale of the Capital Stock of
the Company or any of its Restricted Subsidiaries, each item to be determined in
conformity with GAAP (excluding the effects of foreign currency exchange
adjustments under Financial Accounting Standards Board Statement of Financial
Accounting Standards No. 52).

         "Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at [_______________________].

         "Credit Facility" means the Credit Facility dated as of the Effective
Date, among the Company and the lenders party thereto and any other lenders or
borrowers from time to time party thereto, collateral documents, instruments and
agreements executed in connection therewith and any amendments, supplements,
substitutions, modifications, extensions, renewals, restatements, replacement,
refinancings or refundings thereof.

         "Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement.

         "Default" means any event that is, or after notice or the passage of
time or both would be, an Event of Default.

         "Disqualified Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise is (i) required to be redeemed prior to
the Stated Maturity of the Notes, (ii) redeemable at the option of the holder of
such class or series of Capital Stock at any time prior to the Stated Maturity
of the Notes or (iii) convertible into or exchangeable for Capital Stock
referred to in clause (i) or (ii) above or Indebtedness having a scheduled
maturity prior to the Stated Maturity of the Notes; provided that any Capital
Stock that would not constitute Disqualified Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the Stated Maturity of the Notes shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are no more favorable to the holders of such
Capital Stock than the provisions contained in Section 4.11 and such Capital
Stock specifically provides that such Person will not repurchase or redeem any
such stock pursuant to such provision prior to the Company's repurchase of such
Notes as are required to be repurchased pursuant to Section 4.11 and Section
4.12.

         "Effective Date" means the date on which the Plan becomes effective and
the Notes are originally issued under this Indenture.

         "Eligible Accounts Receivable" means at the time of reference thereto
accounts receivable as set forth on the most recent consolidated balance sheet
filed pursuant to Section 4.18, less accounts receivable of Unrestricted
Subsidiaries as of the date of such balance sheet.

         "Eligible Inventory" means at the time of reference thereto inventory
as set forth on the most recent consolidated balance sheet filed pursuant to
Section 4.18, less inventory of Unrestricted Subsidiaries as of the date of such
balance sheet.





                                       7

         "Event of Default" has the meaning provided in Section 6.01.

         "Excess Proceeds" has the meaning provided in Section 4.11.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended.

         "Executive Managers" at any time means the five individuals who were
the most highly compensated officers or employees of the Company and its
Subsidiaries, taken as a whole, for the most recently ended fiscal year of the
Company.

         "Existing Stockholders" means (i) Saratoga Lighting Holdings LLC and
(ii) any "group" (within the meaning of Sections 13(d) and 14(d)(2) of the
Exchange Act) that includes Saratoga Lighting Holdings LLC, if Saratoga Lighting
Holdings LLC "beneficially owns" (within the meaning of Rule 13d-3 under the
Exchange Act) Voting Stock representing a majority of the voting power of the
Voting Stock owned by such group. "Fair market value" means the price that would
be paid in an arm's-length transaction between an informed and willing seller
under no compulsion to sell and an informed and willing buyer under no
compulsion to buy, as determined in good faith by the Board of Directors, whose
determination shall be conclusive if evidenced by a Board Resolution.

         "Foreign Subsidiaries" means Advanced Lighting Technologies Australia,
Inc. and each Subsidiary of the Company incorporated or organized, as the case
may be, outside of the United States of America.

         "GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Effective Date, including, without
limitation, those 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 approved by a significant segment
of the accounting profession. All ratios and computations contained or referred
to in this Indenture 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 (i) the amortization of any
expenses incurred in connection with the offering of the Notes and (ii) except
as otherwise provided, the amortization of any amounts required or permitted to
be amortized by Accounting Principles Board Opinion Nos. 16 and 17, as
subsequently modified or amended, or the write-off of such amounts.

         "Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness of
such other Person (whether arising by virtue of partnership arrangements, or by
agreements to keep well, to purchase assets, goods, securities or services
(unless such purchase arrangements are on arm's-length terms and are entered
into in the ordinary course of business), to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for purposes
of




                                       8

assuring in any other manner the obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.

         "Guaranteed Indebtedness" has the meaning provided in Section 4.07.

         "Holder" means the registered holder of any Note.

         "Incur" means, with respect to any Indebtedness, to incur, create,
issue, assume, Guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, such
Indebtedness, including an "Incurrence" of Acquired Indebtedness; provided that
neither the accrual of interest nor the accretion of original issue discount
shall be considered an Incurrence of Indebtedness.

         "Indebtedness" means, with respect to any Person at any date of
determination (without duplication), (i) all indebtedness of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all obligations of such
Person in respect of letters of credit or other similar instruments (including
reimbursement obligations with respect thereto, but excluding obligations with
respect to letters of credit (including trade letters of credit) securing
obligations (other than obligations described in (i) or (ii) above or (v), (vi)
or (vii) below) entered into in the ordinary course of business of such Person
to the extent such letters of credit are not drawn upon or, if drawn upon, to
the extent such drawing is reimbursed no later than the third Business Day
following receipt by such Person of a demand for reimbursement), (iv) all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services, which purchase price is due more than six months after the
date of placing such property in service or taking delivery and title thereto or
the completion of such services, except Trade Payables, (v) all Capitalized
Lease Obligations, (vi) all Indebtedness of other Persons secured by a Lien on
any asset of such Person, whether or not such Indebtedness is assumed by such
Person; provided that the amount of such Indebtedness shall be the lesser of (A)
the fair market value of such asset at such date of determination and (B) the
amount of such Indebtedness, (vii) all Indebtedness of other Persons Guaranteed
by such Person to the extent such Indebtedness is Guaranteed by such Person and
(viii) to the extent not otherwise included in this definition, obligations
under Currency Agreements and Interest Rate Agreements. The amount of
Indebtedness of any Person at any date shall be the outstanding balance at such
date of all unconditional obligations as described above and, with respect to
contingent obligations, the maximum liability upon the occurrence of the
contingency giving rise to the obligation, provided (A) that the amount
outstanding at any time of any Indebtedness issued with original issue discount
is the face amount of such Indebtedness less the remaining unamortized portion
of the original issue discount of such Indebtedness at such time as determined
in conformity with GAAP, (B) that money borrowed and set aside at the time of
the Incurrence of any Indebtedness in order to prefund the payment of the
interest on such Indebtedness shall not be deemed to be "Indebtedness" and (C)
that Indebtedness shall not include any liability for federal, state, local or
other taxes.





                                       9

         "Indenture" means this Indenture as originally executed or as it may be
amended or supplemented from time to time by one or more indentures supplemental
to this Indenture entered into pursuant to the applicable provisions of this
Indenture.

         "Interest Coverage Ratio" means, on any Transaction Date, the ratio of
(i) the aggregate amount of Consolidated EBITDA for the then most recent four
fiscal quarters prior to such Transaction Date for which reports have been filed
with the Commission pursuant to Section 4.18 (the "Four Quarter Period") to (ii)
the aggregate Consolidated Interest Expense during such Four Quarter Period. In
making the foregoing calculation, (A) pro forma effect shall be given to any
Indebtedness Incurred or repaid during the period (the "Reference Period")
commencing on the first day of the Four Quarter Period and ending on the
Transaction Date (other than Indebtedness Incurred or repaid under a revolving
credit or similar arrangement to the extent of the commitment thereunder (or
under any predecessor revolving credit or similar arrangement) in effect on the
last day of such Four Quarter Period unless any portion of such Indebtedness is
projected, in the reasonable judgment of the senior management of the Company,
to remain outstanding for a period in excess of 12 months from the date of the
Incurrence thereof), in each case as if such Indebtedness had been Incurred or
repaid on the first day of such Reference Period; (B) Consolidated Interest
Expense attributable to interest on any Indebtedness (whether existing or being
Incurred) computed on a pro forma basis and bearing a floating interest rate
shall be computed as if the rate in effect on the Transaction Date (taking into
account any Interest Rate Agreement applicable to such Indebtedness if such
Interest Rate Agreement has a remaining term in excess of 12 months or, if
shorter, at least equal to the remaining term of such Indebtedness) had been the
applicable rate for the entire period; (C) pro forma effect shall be given to
Asset Dispositions and Asset Acquisitions (including giving pro forma effect to
the application of proceeds of any Asset Disposition) that occur during such
Reference Period as if they had occurred and such proceeds had been applied on
the first day of such Reference Period; and (D) pro forma effect shall be given
to asset dispositions and asset acquisitions (including giving pro forma effect
to the application of proceeds of any asset disposition) that have been made by
any Person that has become a Restricted Subsidiary or has been merged with or
into the Company or any Restricted Subsidiary during such Reference Period and
that would have constituted Asset Dispositions or Asset Acquisitions had such
transactions occurred when such Person was a Restricted Subsidiary as if such
asset dispositions or asset acquisitions were Asset Dispositions or Asset
Acquisitions that occurred on the first day of such Reference Period; provided
that to the extent that clause (C) or (D) of this sentence requires that pro
forma effect be given to an Asset Acquisition or Asset Disposition, such pro
forma calculation shall be based upon the four full fiscal quarters immediately
preceding the Transaction Date of the Person, or division or line of business of
the Person, that is acquired or disposed for which financial information is
available, as determined by the Company.

         "Interest Payment Date" means each semiannual interest payment date on
March 15 and September 15 of each year, commencing on the first such date to
occur after the Effective Date, for so long as any Note remains Outstanding.

         "Interest Rate Agreement" means any interest rate protection agreement,
interest rate future agreement, interest rate option agreement, interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement,
interest rate hedge agreement, option or future contract or other similar
agreement or arrangement.





                                       10

         "Investment" in any Person means any direct or indirect advance, loan
or other extension of credit (including, without limitation, by way of Guarantee
or similar arrangement; but excluding advances to customers in the ordinary
course of business that are, in conformity with GAAP, recorded as accounts
receivable on the balance sheet of the Company or its Restricted Subsidiaries)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, bonds, notes,
debentures or other similar instruments issued by, such Person and shall include
(i) the designation of a Restricted Subsidiary as an Unrestricted Subsidiary and
(ii) the fair market value of the Capital Stock (or any other Investment), held
by the Company or any of its Restricted Subsidiaries, of (or in) any Person that
has ceased to be a Restricted Subsidiary, including without limitation, by
reason of any transaction permitted by clause (iii) of Section 4.06; provided
that the fair market value of the Investment remaining in any Person that has
ceased to be a Restricted Subsidiary shall be deemed not to exceed the aggregate
amount of Investments previously made in such Person valued at the time such
Investments were made less the net reduction of such Investments. For purposes
of the definition of "Unrestricted Subsidiary" and Section 4.04, (i)
"Investment" shall include the fair market value of the assets (net of
liabilities (other than liabilities to the Company or any of its Restricted
Subsidiaries)) of any Restricted Subsidiary at the time that such Restricted
Subsidiary is designated an Unrestricted Subsidiary, (ii) the fair market value
of the assets (net of liabilities (other than liabilities to the Company or any
of its Restricted Subsidiaries)) of any Unrestricted Subsidiary at the time that
such Unrestricted Subsidiary is designated a Restricted Subsidiary shall be
considered a reduction in outstanding Investments and (iii) any property
transferred to or from an Unrestricted Subsidiary shall be valued at its fair
market value at the time of such transfer.

         "Investment Grade Securities" means debt securities or debt instruments
with (A) a final maturity no later than one year after date of acquisition
thereof and (B) a rating of BBB + or higher by S&P or Baal or higher by Moody's
or the equivalent of such rating by such rating organization, or, if no rating
by S&P or Moody's then exists, the equivalent of such rating by any other
nationally recognized statistical rating organization (as defined in Rule 436
under the Securities Act) designated by the Company, but excluding any debt
securities or instruments constituting loans or advances among the Company and
its Subsidiaries.

         "Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including, without limitation, any conditional sale or
other title retention agreement or lease in the nature thereof or any agreement
to give any security interest).

         "Management Services Agreement" means the Management Services Agreement
between the Company and Saratoga Lighting Holdings LLC, dated as of the
Effective Date.

         "Maturity", with respect to any Note, means the date on which the
principal of such Note or an installment of principal becomes due and payable as
provided in or pursuant to this Indenture, whether at the Stated Maturity or by
declaration of acceleration, notice of redemption or repurchase, notice of
option to elect repayment or otherwise, and includes any Redemption Date and
Payment Date.





                                       11

         "Moody's" means Moody's Investors Service, Inc. and its successors.

         "Net Cash Proceeds" means, (a) with respect to any Asset Sale, the
proceeds of such Asset Sale in the form of cash or cash equivalents, including
payments in respect of deferred payment obligations (to the extent corresponding
to the principal, but not interest, component thereof) when received in the form
of cash or cash equivalents (except to the extent such obligations have recourse
to the Company or any Restricted Subsidiary) and proceeds from the conversion of
other property received when converted to cash or cash equivalents, net of (i)
brokerage commissions and other fees and expenses (including fees and expenses
of counsel and investment bankers) related to such Asset Sale, (ii) provisions
for all taxes (whether or not such taxes will actually be paid or are payable)
as a result of such Asset Sale without regard to the consolidated results of
operations of the Company and its Restricted Subsidiaries, taken as a whole,
(iii) payments made to repay Indebtedness or any other obligation outstanding at
the time of such Asset Sale that either (A) is secured by a Lien on the property
or assets sold or (B) is required to be paid as a result of such sale and (iv)
appropriate amounts to be provided by the Company or any Restricted Subsidiary
as a reserve against any liabilities associated with such Asset Sale, including,
without limitation, pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale, all as determined
in conformity with GAAP and (b) with respect to any issuance or sale of Capital
Stock, the proceeds of such issuance or sale in the form of cash or cash
equivalents, including payments in respect of deferred payment obligations (to
the extent corresponding to the principal, but not interest, component thereof)
when received in the form of cash or cash equivalents (except to the extent such
obligations have recourse to the Company or any Restricted Subsidiary) and
proceeds from the conversion of other property received when converted to cash
or cash equivalents, net of attorney's fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees incurred in connection with such issuance or sale and net of taxes
paid or payable as a result thereof.

         "Non-U.S. Person" means a person who is not a "U.S. person" (as defined
in Regulation S).

         "Notes" means any of the securities, as defined in the first paragraph
of the recitals hereof, that are authenticated and delivered under this
Indenture. For all purposes of this Indenture, the term "Notes" shall include
the Notes initially issued on or as of the Effective Date, and any other Notes
issued after the Effective Date under this Indenture. For purposes of this
Indenture, all Notes shall vote together as one series of Notes under this
Indenture.

         "Offer to Purchase" means an offer to purchase Notes by the Company
from the Holders commenced by mailing a notice to the Trustee for delivery to
each Holder stating: (i) the covenant pursuant to which the offer is being made
and that all Notes validly tendered will be accepted for payment on a pro rata
basis; (ii) the purchase price and the date of purchase (which shall be a
Business Day no earlier than 30 days nor later than 60 days from the date such
notice is mailed) (the "Payment Date"); (iii) that any Note not tendered will
continue to accrue interest pursuant to its terms; (iv) that, unless the Company
defaults in the payment of the purchase price, any Note accepted for payment
pursuant to the Offer to Purchase shall cease to accrue interest on and after
the Payment Date; (v) that Holders electing to have a Note purchased pursuant to
the




                                       12

Offer to Purchase will be required to surrender the Note, together with the
form entitled "Option of the Holder to Elect Purchase" on the reverse side of
the Note completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the Business Day immediately preceding the
Payment Date; (vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the third
Business Day immediately preceding the Payment Date, a facsimile transmission or
letter setting forth the name of such Holder, the principal amount of Notes
delivered for purchase and a statement that such Holder is withdrawing his
election to have such Notes purchased; (vii) that Holders whose Notes are being
purchased only in part will be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered; provided that each Note purchased
and each new Note issued shall be in a principal amount of $1,000 or integral
multiples thereof; and (viii) if any Note contains a CUSIP, CINS or ISN number,
no representation is being made as to the correctness of such number either as
printed on any Note or as contained in the Offer and that the Holder should rely
only on the other identification numbers printed on the Notes. On the Payment
Date, the Company shall (i) accept for payment on a pro rata basis (with any
rounding determined by the Company to be reasonable) Notes or portions thereof
tendered pursuant to an Offer to Purchase; (ii) deposit with the Paying Agent
money sufficient to pay the purchase price of all Notes or portions thereof so
accepted; and (iii) deliver, or cause to be delivered, to the Trustee all Notes
or portions thereof so accepted together with an Officers' Certificate
specifying the Notes or portions thereof accepted for payment by the Company.
The Paying Agent shall promptly mail to the Holders of Notes so accepted payment
in an amount equal to the purchase price, and the Trustee shall promptly
authenticate and mail to such Holders a new Note equal in principal amount to
any unpurchased portion of the Note surrendered; provided that each Note
purchased and each new Note issued shall be in a principal amount of $1,000 or
integral multiples thereof (with any rounding determined by the Company to be
reasonable). The Company shall publicly announce the results of an Offer to
Purchase as soon as practicable after the Payment Date. The Trustee shall act as
the Paying Agent for an Offer to Purchase. The Company shall comply with Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable, in the event
that the Company is required to repurchase Notes pursuant to an Offer to
Purchase.

         "Officer" means, with respect to the Company, (i) the Chairman of the
Board, the Vice Chairman of the Board, the Chief Executive Officer, the
President, the Executive Vice President, the Senior Vice President, any Vice
President or the Chief Financial Officer, and (ii) the Treasurer or any
Assistant Treasurer, or the Secretary or any Assistant Secretary.

         "Officers' Certificate" means a certificate signed by one Officer
listed in clause (i) of the definition thereof and one Officer listed in clause
(ii) of the definition thereof or two officers listed in clause (i) of the
definition thereof. Each Officers' Certificate (other than certificates provided
pursuant to TIA Section 314(a)(4)) shall include the statements provided for in
TIA Section 314(e).

         "Opinion of Counsel" means a written opinion signed by legal counsel,
who may be an employee of or counsel to the Company, that meets the requirements
of Section 10.04 hereof. Each such Opinion of Counsel shall include the
statements provided for in TIA Section 314(e).





                                       13

         "Outstanding", when used with respect to any Note, means, as of the
date of determination, all such Notes theretofore authenticated and delivered
under this Indenture, except:

          (a) any such Note theretofore cancelled by the Trustee or delivered to
     the Trustee for cancellation;

          (b) any such Note for whose payment at the Maturity thereof money in
     the necessary amount has been theretofore deposited pursuant hereto (other
     than pursuant to Section 8.02 and 8.03) with the Trustee or any Paying
     Agent (other than the Company) in trust or set aside and segregated and in
     trust by the Company (if the Company shall act as its own Paying Agent) for
     the Holders of such Notes, provided that, if such Notes are to be redeemed,
     notice of such redemption has been duly given pursuant to this Indenture or
     provision therefor satisfactory to the Trustee has been made;

          (c) any such Note with respect to which the Company has effected
     defeasance pursuant to the terms hereof, except to the extent provided in
     Article Eight; and

          (d) any such Note which has been paid pursuant to Section 2.06 or in
     exchange for or in lieu of which other Notes have been authenticated and
     delivered pursuant to this Indenture, unless there shall have been
     presented to the Trustee proof satisfactory to it that such Note is held by
     a bona fide purchaser in whose hands such Note is a valid obligation of the
     Company;

provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present at
a meeting of Holders of Notes for quorum purposes or for purposes of making
calculations required by TIA Section 313, Notes owned by the Company or any
other obligor upon the Notes or any Affiliate of the Company or such other
obligor, shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in making any such
determination or relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which a Responsible Officer of
the Trustee actually knows to be so owned shall be so disregarded.

         "Paying Agent" has the meaning provided in Section 2.03, except that,
for the purposes of Article Eight, the Paying Agent shall not be the Company or
a Subsidiary of the Company or an Affiliate of any of them. The term "Paying
Agent" includes any additional Paying Agent.

         "Permitted Investment" means (i) an Investment in the Company or a
Restricted Subsidiary or a Person which will, upon the making of such
Investment, become a Restricted Subsidiary or be merged or consolidated with or
into or transfer or convey all or substantially all its assets to, the Company
or a Restricted Subsidiary; provided that such person's primary business is
related, ancillary or complementary to the businesses of the Company and its
Restricted Subsidiaries on the date of such Investment; (ii) Temporary Cash
Investments; (iii) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as expenses
in accordance with GAAP; (iv) stock, obligations or securities received in
satisfaction of judgments; (v) an Investment in any Person consisting




                                       14

solely of the transfer to such Person of an Investment in another Person that is
not a Restricted Subsidiary; (vi) Investment Grade Securities; (vii) Interest
Rate Agreements and Currency Agreements designed solely to protect the Company
or its Restricted Subsidiaries against fluctuations in interest rates or foreign
currency exchange rates; (viii) Investments, not to exceed $30 million at any
one time outstanding (and for purposes of this clause (viii) an Investment shall
be deemed to be outstanding in the amount of the excess (but not, in any event,
less than zero) of the amount of such Investment on the date or dates made, less
the return of capital to the Company and its Restricted Subsidiaries with
respect to such Investment); (ix) Investments, to the extent the consideration
therefor consists of Capital Stock (other than Disqualified Stock) of the
Company or net cash proceeds from the sale of such Capital Stock, if such
Capital Stock was issued or sold within 90 days of the making of such
Investment; and (x) extensions of credit to customers and suppliers in the
ordinary course of business.

         "Permitted Liens" means (i) Liens for taxes, assessments, governmental
charges or claims that are being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provision, if any, as shall be required in conformity with
GAAP shall have been made; (ii) statutory and common law Liens of landlords and
carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other
similar Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provision, if any, as shall be required in conformity with
GAAP shall have been made; (iii) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other types of social security; (iv) Liens incurred or deposits
made to secure the, performance of tenders, bids, leases, statutory or
regulatory obligations, bankers' acceptances, surety and appeal bonds,
government contracts, performance and return-of-money bonds and other
obligations of a similar nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money); (v) easements,
rights-of-way, municipal and zoning ordinances and similar charges,
encumbrances, title defects or other irregularities that do not materially
interfere with the ordinary course of business of the Company or any of its
Restricted Subsidiaries; (vi) Liens (including extensions and renewals thereof)
upon real or personal property acquired after the Effective Date; provided that
(a) such Lien is created solely for the purpose of securing Indebtedness
Incurred, in accordance with Section 4.03, to finance the cost (including the
cost of improvement or construction) of the item of property or assets subject
thereto and such Lien is created prior to, at the time of or within six months
after the later of the acquisition, the completion of construction or the
commencement of full operation of such property or to refinance Indebtedness
previously so secured, (b) the principal amount of the Indebtedness secured by
such Lien does not exceed 100% of such cost and (c) any such Lien shall not
extend to or cover any property or assets other than such item of property or
assets and any improvements on such item; (vii) licenses, leases or subleases
granted to others that do not materially interfere with the ordinary course of
business of the Company and its Restricted Subsidiaries, taken as a whole;
(viii) Liens encumbering property or assets under construction arising from
progress or partial payments by a customer of the Company or its Restricted
Subsidiaries relating to such property or assets; (ix) any interest or title of
a lessor in the property subject to any Capitalized Lease or operating lease;
(x) Liens arising from filing Uniform Commercial Code financing statements
regarding leases; (xi) Liens on property of, or on shares of Capital Stock or
Indebtedness of, any Person existing at the time such Person




                                       15

becomes, or becomes a part of, any Restricted Subsidiary; provided that such
Liens do not extend to or cover any property or assets of the Company or any
Restricted Subsidiary other than the property or assets acquired; (xii) Liens in
favor of the Company or any Restricted Subsidiary; (xiii) Liens arising from the
rendering of a final judgment or order against the Company or any Restricted
Subsidiary that does not give rise to an Event of Default; (xiv) Liens securing
reimbursement obligations with respect to letters of credit that encumber
documents and other property relating to such letters of credit and the products
and proceeds thereof; (xv) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in connection
with the importation of goods; (xvi) Liens encumbering customary initial
deposits and margin deposits, and other Liens that are within the general
parameters customary in the industry and incurred in the ordinary course of
business, in each case, securing Indebtedness under Interest Rate Agreements and
Currency Agreements and forward contracts, options, future contracts, futures
options or similar agreements or arrangements designed solely to protect the
Company or any of its Restricted Subsidiaries from fluctuations in interest
rates, currencies or the price of commodities; (xvii) Liens arising out of
conditional sale, title retention, consignment or similar arrangements for the
sale of goods entered into by the Company or any of its Restricted Subsidiaries
in the ordinary course of business in accordance with the past practices of the
Company and its Restricted Subsidiaries prior to the Effective Date; (xviii)
Liens on or sales of receivables; (xix) liens existing on the Effective Date;
and (xx) Liens securing the Notes.

         "Person" means an individual, a corporation, a partnership, a limited
liability company, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.

          "Plan" means the Joint Chapter 11 Plan of Reorganization of the
Company and certain of its United States Subsidiaries as defined in the recitals
hereof.

         "Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's preferred or preference equity,
whether outstanding on the Effective Date or issued thereafter, including,
without limitation, all series and classes of such preferred or preference
stock.

         "Principal" of a debt security, including the Notes, means the
principal amount due on the Stated Maturity as shown on such debt security.

         "Public Equity Offering" means an underwritten public offering of
Common Stock by the Company pursuant to an effective registration statement
under the Securities Act.

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

         "Redemption Price" means, when used with respect to any Note to be
redeemed, the price at which such Note is to be redeemed pursuant to this
Indenture.

         "Registrar" has the meaning provided in Section 2.03.





                                       16

         "Regular Record Date" for the interest payable on any Interest Payment
Date means the March 1 or September 1 (whether or not a Business Day), as the
case may be, next preceding the related Interest Payment Date.

         "Responsible Officer", when used with respect to the Trustee, means any
vice president, any assistant vice president, any assistant secretary, any
assistant treasurer, any trust officer or assistant trust officer, or any other
officer of the Trustee in its Corporate Trust Department customarily performing
functions similar to those performed by any of the above-designated officers and
in each case having direct responsibility for the administration of this
Indenture 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 Payments" has the meaning provided in Section 4.04.

         "Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.

         "Securities Act" mean the Securities Act of 1933, as amended.

         "Security Register" has the meaning provided in Section 2.03.

         "Significant Subsidiary" means, at any date of determination, any
Restricted Subsidiary that, together with its Subsidiaries, (i) for the most
recent fiscal year of the Company, accounted for more than 10% of the
consolidated revenues of the Company and its Restricted Subsidiaries or (ii) as
of the end of such fiscal year, was the owner of more than 10% of the
consolidated assets of the Company and its Restricted Subsidiaries, all as set
forth on the most recently available consolidated financial statements of the
Company for such fiscal year, as determined by the Company.

         "S&P" means Standard & Poor's Ratings Service and its successors.

         "Stated Maturity" means, (i) with respect to any debt security, the
date specified in such debt security as the fixed date on which the final
installment of principal of such debt security is due and payable and (ii) with
respect to any scheduled installment of principal of or interest on any debt
security, the date specified in such debt security as the fixed date on which
such installment is due and payable.

         "Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
and one or more other Subsidiaries of such Person.

         "Subsidiary Guarantee" has the meaning provided in Section 4.07.

         "Temporary Cash Investment" means any of the following: (i) direct
obligations of the United States of America or any agency thereof or obligations
fully and unconditionally guaranteed by the United States of America or any
agency thereof, (ii) time deposit accounts, certificates of deposit and money
market deposits maturing within one year of the date of




                                       17

acquisition thereof issued by a bank or trust company which is organized under
the laws of the United States of America, any state thereof or any foreign
country recognized by the United States of America, and which bank or trust
company has capital, surplus and undivided profits aggregating in excess of $50
million (or the foreign currency equivalent thereof) and has outstanding debt
which is rated "A" (or such similar equivalent rating) or higher by at least one
nationally recognized statistical rating organization (as defined in Rule 436
under the Securities Act) or any money-market fund sponsored by a registered
broker dealer or mutual fund distributor, (iii) repurchase obligations with a
term of not more than 30 days for underlying securities of the types described
in clause (i) above entered into with a bank meeting the qualifications
described in clause (ii) above, (iv) commercial paper, maturing not more than
270 days after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America, any state thereof or any foreign country recognized by
the United States of America with a rating at the time as of which any
investment therein is made of "P-1" (or higher) according to Moody's or "A-l"
(or higher) according to S&P, (v) securities with maturities of one year or less
from the date of acquisition issued or fully and unconditionally guaranteed by
any state, commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least BBB+ by
S&P or Baal by Moody's and (vi) time deposit accounts, certificates of deposits
and money market deposits aggregating no more than $10 million at any one time
outstanding, issued by one of the five largest (based on assets on the most
recent December 31 for which data is available) banks organized under the laws
of the country in which the Foreign Subsidiary marking the deposit referred to
above is organized, if such bank is not under material government intervention.

         "TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939
(15 U.S. Code ss.ss. 77aaa-77bbbb), as in effect on the date this Indenture was
executed, except as provided in Section 9.06; provided that in the event the
Trust Indenture Act of 1939 is amended after the Effective Date, "TIA" or "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939, as so amended.

         "Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary course of business in connection with the acquisition of goods
or services, in each case required to be paid within one year.

         "Transaction Date" means, with respect to the Incurrence of any
Indebtedness by the Company or any of its Restricted Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment, the
date such Restricted Payment is to be made.

         "Trustee" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article Seven of this Indenture and thereafter means such successor.

         "United States Bankruptcy Code" means the Bankruptcy Reform Act of
1978, as amended and as codified in Title 11 of the United States Code, as
amended from time to time hereafter, or any successor federal bankruptcy law.





                                       18

         "Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below; and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors may designate any Restricted
Subsidiary (including any newly acquired or newly formed Subsidiary of the
Company) to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock of, or owns or holds any Lien on any property of, the Company or
any Restricted Subsidiary; provided that (A) any Guarantee by the Company or any
Restricted Subsidiary of any Indebtedness of the Subsidiary being so designated
shall be deemed an "Incurrence" of such Indebtedness and an "Investment" by the
Company or such Restricted Subsidiary (or both, if applicable) at the time of
such designation; (B) either (I) the Subsidiary to be so designated has total
assets of $1,000 or less or (II) if such Subsidiary has assets greater than
$1,000, such designation would be permitted under Section 4.04; and (C) if
applicable, the Incurrence of Indebtedness and the Investment referred to in
clause (A) of this proviso would be permitted under Section 4.03 and Section
4.04. The Board of Directors may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided that (x) no Default or Event of Default shall
have occurred and be continuing at the time of or after giving effect to such
designation and (y) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately after such designation would, if Incurred at such time,
have been permitted to be Incurred (and shall be deemed to have been Incurred)
for all purposes of this Indenture. Any such designation by the Board of
Directors shall be evidenced to the Trustee by promptly filing with the Trustee
a copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
foregoing provisions.

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

         "Voting Stock" means with respect to any Person, Capital Stock of any
class or kind having the power to vote for the election of directors, managers
or other voting members of the governing body of such Person (not including,
however, any Capital Stock having such right to vote only upon the happening of
certain events or under limited circumstances).

         "Wholly Owned" means, with respect to any Subsidiary of any Person, the
ownership of all of the outstanding Capital Stock of such Subsidiary (other than
any director's qualifying shares or Investments by foreign nationals mandated by
applicable law) by such Person or one or more Wholly Owned Subsidiaries of such
Person.





                                       19

          SECTION 1.02.  Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:

                  "indenture securities" means the Notes;

                  "indenture security holder" means a Holder or a Noteholder;

                  "indenture to be qualified" means this Indenture;

                  "indenture trustee" or "institutional trustee" means the
Trustee; and

                  "obligor" on the indenture securities means the Company or
any other obligor on the Notes.

         All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by a rule of the
Commission and not otherwise defined herein have the meanings assigned to them
therein.

         SECTION 1.03.  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 as defined in Section 1.01;

          (iii) "or" is not exclusive;

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

          (v) provisions apply to successive events and transactions;

          (vi) "herein," "hereof" and other words of similar import refer to
     this Indenture as a whole and not to any particular Article, Section or
     other subdivision;

          (vii) all ratios and computations based on GAAP contained in this
     Indenture shall be computed in accordance with the definition of GAAP set
     forth in Section 1.01; and

          (viii) all references to Sections, Articles or Exhibits refer to
     Sections, Articles or Exhibits of this Indenture unless otherwise
     indicated.

                                  ARTICLE TWO
                                    THE NOTES

        SECTION 2.01.  Form and Dating. The Notes and the Trustee's certificate
of authentication shall be substantially in the form annexed hereto as Exhibit A
with such




                                       20

appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture. The Notes may have notations,
legends or endorsements required by law, stock exchange agreements to which the
Company is subject or usage. The Company shall approve the form of the Notes and
any notation, legend or endorsement on the Notes. Each Note shall be dated the
date of its authentication.

         The terms and provisions contained in the form of the Notes annexed
hereto as Exhibit A shall constitute, and are hereby expressly made, a part of
this Indenture. To the extent applicable, 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.

         The definitive Notes shall be typed, printed, lithographed or engraved
or produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities depositary or of any securities
exchange on which the Notes may be listed, all as determined by the Officers
executing such Notes, as evidenced by their execution of such Notes.

        SECTION 2.02.  Execution, Authentication and Denominations. Subject to
Article Four and applicable law, the aggregate principal amount of Notes which
may be authenticated and delivered under this Indenture is limited to
$[____________]. The Notes shall be executed by two Officers of the Company. The
signature of these Officers on the Notes may be by facsimile or manual signature
in the name and on behalf of the Company.

         If an Officer whose signature is on a Note no longer holds that office
at the time the Trustee or authenticating agent authenticates the Note, the Note
shall be valid nevertheless.

         A Note shall not be valid until the Trustee or authenticating agent
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.

         At any time and from time to time after the execution of this
Indenture, the Trustee or an authenticating agent shall upon receipt of a
Company Order authenticate for original issue Notes in the aggregate principal
amount specified in such Company Order; provided that the Trustee shall be
entitled to receive an Officers' Certificate and an Opinion of Counsel of the
Company in connection with such authentication of Notes. Such Company Order
shall specify the amount of Notes to be authenticated and the date on which the
original issue of Notes is to be authenticated.

         The Trustee may appoint an authenticating agent 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 authenticating agent. An authenticating agent has the
same rights as an Agent to deal with the Company or an Affiliate of the Company.

         The Notes shall be issuable only in registered form without coupons and
only in denominations of $1,000 in principal amount and any integral multiple of
$1,000 in excess thereof.


        SECTION 2.03.  Registrar and Paying Agent. The Company shall maintain an
office or agency where Notes may be presented for registration of transfer or
for exchange (the




                                       21

"Registrar"), an office or agency where Notes may be presented for payment (the
"Paying Agent") and an office or agency where notices and demands to or upon the
Company in respect of the Notes and this Indenture may be served, which shall be
in the Borough of Manhattan, The City of New York. The Company shall cause the
Registrar to keep a register of the Notes and of their transfer and exchange
(the "Security Register"). The Security Register shall be in written form or any
other form capable of being converted into written form within a reasonable
time. The Company may have one or more co-Registrars and one or more additional
Paying Agents.

         The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall give
prompt written notice to the Trustee of the name and address of any such Agent
and any change in the address of such Agent. If the Company fails to maintain a
Registrar, Paying Agent and/or agent for service of notices and demands, the
Trustee shall act as such Registrar, Paying Agent and/or agent for service of
notices and demands. The Company may remove any Agent upon written notice to
such Agent and the Trustee; provided that no such removal shall become effective
until (i) the acceptance of an appointment by a successor Agent to such Agent as
evidenced by an appropriate agency agreement entered into by the Company and
such successor Agent and delivered to the Trustee or (ii) notification to the
Trustee that the Trustee shall serve as such Agent until the appointment of a
successor Agent in accordance with clause (i) of this proviso. The Company, any
Subsidiary of the Company, or any Affiliate of any of them may act as Paying
Agent, Registrar or co-Registrar, and/or agent for service of notice and
demands.

         The Company initially appoints the Trustee as Registrar, Paying Agent,
authenticating agent and agent for service of notice and demands. The Trustee
shall preserve in as current a form as is reasonably practicable the most recent
list available to it of the names and addresses of Holders and shall otherwise
comply with TIA ss. 312(a). If the Trustee is not the Registrar, the Company
shall furnish to the Trustee as of each Regular Record Date and at such other
times as the Trustee may reasonably request the names and addresses of Holders
as they appear in the Security Register, including the aggregate principal
amount of Notes held by each Holder.

        SECTION 2.04.  Paying Agent to Hold Money in Trust. Not later than
10:00 a.m. (New York City time) each due date of the principal, Redemption Price
of and interest on any Notes, the Company shall deposit with the Paying Agent
money in immediately available funds sufficient to pay such principal,
Redemption Price, and interest so becoming due. The Company shall require each
Paying Agent other than the Trustee to agree in writing that such Paying Agent
shall hold in trust for the benefit of the Holders or the Trustee all money held
by the Paying Agent for the payment of principal of, Redemption Price, and
interest on the Notes (whether such money has been paid to it by the Company or
any other obligor on the Notes), and such Paying Agent shall promptly notify the
Trustee of any default by the Company (or any other obligor on the Notes) in
making any such payment. The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee and account for any funds disbursed, and
the Trustee may at any time during the continuance of any payment default, upon
written request to a Paying Agent, require such Paying Agent to pay all money
held by it to the Trustee and to account for any funds disbursed. Upon doing so,
the Paying Agent shall have no further liability for the money so paid over to
the Trustee. If the Company or any Subsidiary of the Company or any Affiliate of
any of them acts as Paying Agent, it will, on or before each due date of any




                                       22

principal of, Redemption Price, or interest on the Notes, segregate and hold in
a separate trust fund for the benefit of the Holders a sum of money sufficient
to pay such principal, Redemption Price, or interest so becoming due until such
sum of money shall be paid to such Holders or otherwise disposed of as provided
in this Indenture, and will promptly notify the Trustee of its action or failure
to act.

        SECTION 2.05.   Transfer and Exchange. The Notes are issuable only in
registered form. A Holder may transfer a Note only by written application to the
Registrar stating the name of the proposed transferee and otherwise complying
with the terms of this Indenture. No such transfer shall be effected until, and
such transferee shall succeed to the rights of a Holder only upon, final
acceptance and registration of the transfer by the Registrar in the Security
Register. Prior to the registration of any transfer by a Holder as provided
herein, the Company, the Trustee, and any agent of the Company shall treat the
person in whose name the Note is registered as the owner thereof for all
purposes whether or not the Note shall be overdue, and neither the Company, the
Trustee, nor any such agent shall be affected by notice to the contrary. When
Notes are presented to the Registrar or a co-Registrar with a request to
register the transfer or to exchange them for an equal principal amount of Notes
of other authorized denominations, the Registrar shall register the transfer or
make the exchange as requested if its requirements for such transactions are met
(including that such Notes are duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and Registrar duly
executed by the Holder thereof or by an attorney who is authorized in writing to
act on behalf of the Holder). To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate Notes at
the Registrar's request. No service charge shall be made for any registration of
transfer or exchange or redemption of the Notes, 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
other similar governmental charge payable upon exchanges pursuant to Section
2.08, 3.08 or 9.04).

         The Registrar shall not be required (i) to issue, register the transfer
of or exchange any Note during a period beginning at the opening of business 15
days before the day of the mailing of a notice of redemption of Notes selected
for redemption under Section 3.03 and ending at the close of business on the day
of such mailing, or (ii) to register the transfer of or exchange any Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part.

        SECTION 2.06.   Replacement Notes. If a mutilated Note is surrendered
to the Trustee or if the Holder claims that the Note has been lost, destroyed or
wrongfully taken, then, in the absence of notice to the Company or the Trustee
that such Note has been acquired by a bona fide purchaser, the Company shall
issue and the Trustee shall authenticate a replacement Note of like tenor and
principal amount and bearing a number not contemporaneously outstanding;
provided that the requirements of this paragraph and the second paragraph of
Section 2.07 are met. An indemnity bond may be required to be furnished that is
sufficient in the judgment of both the Trustee and the Company to protect the
Company, the Trustee or any Agent from any loss that any of them may suffer if a
Note is replaced. The Company may charge such Holder for its expenses and the
expenses of the Trustee in replacing a Note. In case




                                       23

any such mutilated, lost, destroyed or wrongfully taken Note has become or is
about to become due and payable, the Company in its discretion may pay such Note
instead of issuing a new Note in replacement thereof.

         Every replacement Note is an additional obligation of the Company and
shall be entitled to the benefits of this Indenture.

        SECTION 2.07.   Outstanding Notes. Notes Outstanding at any time are
all Notes that have been authenticated by the Trustee except for those canceled
by it, those delivered to it for cancellation and those described in this
Section 2.07 as not outstanding.

         If a Note is replaced or paid pursuant to Section 2.06, it ceases to be
Outstanding unless and until the Trustee and the Company receive proof
satisfactory to them that the replaced or paid Note is held by a bona fide
purchaser.

         If the Paying Agent (other than the Company or an Affiliate of the
Company) holds at the Maturity thereof money sufficient to pay Notes payable on
that date, then on and after that date such Notes cease to be Outstanding and
interest on them shall cease to accrue.

         SECTION 2.08.  Temporary Notes. Until definitive Notes are ready for
delivery, the Company may prepare and execute and the Trustee shall authenticate
temporary Notes. Temporary Notes shall be substantially in the form of
definitive Notes but may have insertions, substitutions, omissions and other
variations determined to be appropriate by the Officers executing the temporary
Notes, as evidenced by their execution of such temporary Notes. If temporary
Notes are issued, the Company will cause definitive Notes to be prepared without
unreasonable delay. After the preparation of definitive Notes, the temporary
Notes shall be exchangeable for definitive Notes upon surrender of the temporary
Notes at the office or agency of the Company designated for such purpose
pursuant to Section 4.02, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Notes the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Notes of authorized denominations. Until so exchanged, the
temporary Notes shall be entitled to the same benefits under this Indenture as
definitive Notes.

         SECTION 2.09.  Cancellation. The Company at any time may deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee for cancellation any Notes previously authenticated
hereunder which the Company has not issued and sold. The Registrar and the
Paying Agent shall forward to the Trustee any Notes surrendered to them for
transfer, exchange or payment. The Trustee shall cancel all Notes surrendered
for transfer, exchange, payment or cancellation and shall dispose of them in
accordance with its normal procedure. Except as expressly permitted by this
Indenture, the Company may not issue new Notes to replace Notes it has paid in
full or delivered to the Trustee for cancellation.

         SECTION 2.10.  CUSIP Numbers. The Company in issuing the Notes may use
"CUSIP", "CINS" or "ISIN" numbers (if then generally in use), and the Trustee
shall use CUSIP, CINS or ISIN numbers, as the case may be, in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice shall state that no representation is made




                                       24

as to the correctness of such numbers either as printed on the Notes or as
contained in any notice of redemption or exchange and that reliance may be
placed only on the other identification numbers printed on the Notes. The
Company will promptly notify the Trustee of any change in "CUSIP", "CINS" or
"ISIN" numbers for the Notes.

        SECTION 2.11.   Defaulted Interest. If the Company defaults in a
payment of interest on the Notes, it shall pay, or shall deposit with the Paying
Agent money in immediately available funds sufficient to pay, the defaulted
interest, plus (to the extent lawful) any interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date. A
special record date, as used in this Section 2.11 with respect to the payment of
any defaulted interest, shall mean the 15th day next preceding the date fixed by
the Company for the payment of defaulted interest, whether or not such day is a
Business Day. At least 15 days before the subsequent special record date, the
Company shall mail to each Holder and to the Trustee a notice that states the
subsequent special record date, the payment date and the amount of defaulted
interest to be paid.

                                 ARTICLE THREE
                                   REDEMPTION


        SECTION 3.01.   Right of Redemption. The Notes shall be redeemable, at
the Company's option, in whole or in part, at any time or from time to time, on
or after September 15, 2004 and prior to Maturity, upon not less than 30 nor
more than 60 days' prior notice mailed by first-class mail to each Holder's last
address, as it appears in the Security Register, at the following Redemption
Prices (expressed in percentages of principal amount), plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of Holders of
record on the relevant Regular Record Date that is prior to the Redemption Date
to receive interest due on an Interest Payment Date), if redeemed during the
12-month period commencing September 15 of the years set forth below:

                                                   Redemption
              Year                                   Price
              ----                                   -----
              2004.............................     106.000%
              2005.............................     104.000
              2006.............................     102.667
              2007.............................     101.333
              2008 and thereafter                   100.000

         SECTION 3.02.  Notices to Trustee. If the Company elects to redeem
Notes pursuant to Section 3.01, it shall notify the Trustee in writing of the
Redemption Date and the principal amount of Notes to be redeemed and the clause
of this Indenture pursuant to which redemption shall occur.

         SECTION 3.03.  Selection of Notes to Be Redeemed. If less than all of
the Notes are to be redeemed at any time, the Trustee shall select the Notes to
be redeemed by lot or by such other method as the Trustee in its sole discretion
shall deem fair and appropriate; provided that no Note of $1,000 in principal
amount or less shall be redeemed in part.





                                       25

         The Trustee shall make the selection from the Notes outstanding and not
previously called for redemption. Notes in denominations of $1,000 in principal
amount may only be redeemed in whole. The Trustee may select for redemption
portions (equal to $1,000 in principal amount or any integral multiple thereof)
of Notes that have denominations larger than $1,000 in principal amount.
Provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption. The Trustee shall notify the
Company and the Registrar promptly in writing of the Notes or portions of Notes
to be called for redemption.

         SECTION 3.04.  Notice of Redemption. With respect to any redemption of
Notes pursuant to Section 3.01, at least 30 days but not more than 60 days
before a Redemption Date, the Company shall mail a notice of redemption by
first-class mail to each Holder whose Notes are to be redeemed.

         The notice shall identify the Notes (including CUSIP, CINS or ISIN
number(s), as applicable) to be redeemed and shall state:

          (i) the Redemption Date;

          (ii) the Redemption Price and any accrued interest then due and
     payable;

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

          (iv) that Notes called for redemption must be surrendered to the
     Paying Agent in order to collect the Redemption Price;

          (v) that, unless the Company defaults in making the redemption
     payment, interest on Notes called for redemption ceases to accrue on and
     after the Redemption Date and the only remaining right of the Holders is to
     receive payment of the Redemption Price plus accrued interest to the
     Redemption Date upon surrender of the Notes to the Paying Agent;

          (vi) that, if any Note is being redeemed in part, the portion of the
     principal amount (equal to $1,000 in principal amount or any integral
     multiple thereof) of such Note to be redeemed and that, on and after the
     Redemption Date, upon surrender of such Note, a new Note or Notes in
     principal amount equal to the unredeemed portion thereof will be issued;
     and

          (vii) that, if any Note contains a CUSIP, CINS or ISIN number as
     provided in Section 2.10, no representation is being made as to the
     correctness of the CUSIP, CINS or ISIN number either as printed on the
     Notes or as contained in the notice of redemption and that reliance may be
     placed only on the other identification numbers printed on the Notes.

         At the Company's request (which request may be revoked by the Company
at any time prior to the time at which the Trustee shall have given such notice
to the Holders), made in writing to the Trustee at least 45 days (or such
shorter period as shall be satisfactory to the Trustee) before a Redemption
Date, the Trustee shall give the notice of redemption pursuant to




                                       26

Section 3.01 in the name and at the expense of the Company. If, however, the
Company gives such notice to the Holders, the Company shall concurrently deliver
to the Trustee an Officers' Certificate stating that such notice has been given.

        SECTION 3.05. Effect of Notice of Redemption. Once notice of redemption
is mailed, Notes called for redemption become due and payable on the Redemption
Date and at the Redemption Price. Upon surrender of any Notes to the Paying
Agent, such Notes shall be paid at the Redemption Price, plus accrued interest,
if any, to the Redemption Date.

         Notice of redemption shall be deemed to be given when mailed, whether
or not the Holder receives the notice. In any event, failure to give such
notice, or any defect therein, shall not affect the validity of the proceedings
for the redemption of Notes held by Holders to whom such notice was properly
given.

        SECTION 3.06. Deposit of Redemption Price. On or prior to 10:00 a.m.,
New York City time, any Redemption Date, the Company shall deposit with the
Paying Agent (or, if the Company is acting as its own Paying Agent, shall
segregate and hold in trust as provided in Section 2.04) money sufficient to pay
the Redemption Price of and accrued interest on all Notes to be redeemed on that
date other than Notes or portions thereof called for redemption on that date
that have been delivered by the Company to the Trustee for cancellation.

         SECTION 3.07.  Payment of Notes Called for Redemption. If notice of
redemption has been given in the manner provided above, the Notes or portion of
Notes specified in such notice to be redeemed shall become due and payable on
the Redemption Date at the Redemption Price stated therein, together with
accrued interest to such Redemption Date, and on and after such date (unless the
Company shall default in the payment of such Notes at the Redemption Price and
accrued interest to the Redemption Date, in which case the principal, until
paid, shall bear interest from the Redemption Date at the rate prescribed in the
Notes), such Notes shall cease to accrue interest. Upon surrender of any Note
for redemption in accordance with a notice of redemption, such Note shall be
paid and redeemed by the Company at the Redemption Price, together with accrued
interest, if any, to the Redemption Date; provided that installments of interest
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders registered as such at the close of business on the relevant Regular
Record Date.

         SECTION 3.08.  Notes Redeemed in Part. Upon surrender of any Note that
is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Note equal in principal amount to
the unredeemed portion of such surrendered Note.

                                  ARTICLE FOUR
                                    COVENANTS

         SECTION 4.01.  Payment of Notes. The Company shall pay the principal
of, Redemption Prices of, and interest on the Notes on the dates and in the
manner provided in the Notes and this Indenture. An installment of principal,
Redemption Price or interest shall be considered paid on the date due if the
Trustee or Paying Agent (other than the Company, a Subsidiary of the Company, or
any Affiliate of any of them) holds on that date money designated




                                       27

for and sufficient to pay the installment. If the Company or any Subsidiary of
the Company or any Affiliate of any of them acts as Paying Agent, an installment
of principal, Redemption Price, or interest shall be considered paid on the due
date if the entity acting as Paying Agent complies with the last sentence of
Section 2.04. As provided in Section 6.09, upon any bankruptcy or reorganization
procedure relative to the Company, the Trustee shall serve as the Paying Agent
for the Notes.

         The Company shall pay interest on overdue principal and Redemption
Price, to the extent lawful, at the rate per annum specified in the Notes.

         SECTION 4.02.  Maintenance of Office or Agency. The Company will
maintain in the Borough of Manhattan, the City of New York, an office or agency
where Notes may be surrendered for registration of transfer or exchange or for
presentation for payment and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company will 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 address of the Trustee set forth in Section 10.02.

         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
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 will give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.

         The Company hereby initially designates the Corporate Trust Office of
the Trustee as such office of the Company in accordance with Section 2.03.

         SECTION 4.03.  Limitation on Indebtedness. (a) The Company will not,
and will not permit any of its Restricted Subsidiaries to, Incur any
Indebtedness (other than the Notes and Indebtedness existing on the Effective
Date); provided that the Company may Incur Indebtedness if, after giving effect
to the Incurrence of such Indebtedness and the receipt and application of the
proceeds therefrom, the Interest Coverage Ratio would be greater than 2.5:1.

         Notwithstanding the foregoing, the Company and any Restricted
Subsidiary (except as specified below) may Incur each and all of the following:
(i) Indebtedness of the Company under the Credit Facility or any other agreement

in an aggregate principal amount outstanding at any time not to exceed $85
million, less any amount of such Indebtedness permanently repaid as provided
under Section 4.11; (ii) Indebtedness owed (A) to the Company evidenced by an
unsubordinated promissory note or (B) to any Restricted Subsidiary; provided
that any event which results in any such Restricted Subsidiary ceasing to be a
Restricted Subsidiary or any subsequent transfer of such Indebtedness (other
than to the Company or another Restricted Subsidiary) shall be deemed, in each
case, to constitute an Incurrence of such Indebtedness not permitted by this
clause (ii); (iii) Indebtedness issued in exchange for, or the net proceeds of




                                       28

which are used to refinance or refund, then outstanding Indebtedness (incurred
under clause (v) or (xi) of this paragraph) and any refinancings thereof in an
amount not to exceed the amount so refinanced or refunded (plus premiums,
accrued interest, fees and expenses); provided that Indebtedness the proceeds of
which are used to refinance or refund the Notes or Indebtedness that is pari
passu with, or subordinated in right of payment to, the Notes shall only be
permitted under this clause (iii) if (A) in case the Notes are refinanced in
part or the Indebtedness to be refinanced is pari passu with the Notes, such new
Indebtedness, by its terms or by the terms of any agreement or instrument
pursuant to which such new Indebtedness is outstanding, is expressly made pari
passu with, or subordinate in right of payment to, the remaining Notes, (B) in
case the Indebtedness to be refinanced is subordinated in right of payment to
the Notes, such new Indebtedness, by its terms or by the terms of any agreement
or instrument pursuant to which such new Indebtedness is issued or remains
outstanding, is expressly made subordinate in right of payment to the Notes and
any other Indebtedness of the Company to which the same is also made subordinate
in right of payment at least to the extent that the Indebtedness to be
refinanced is subordinated to the Notes and (C) such new Indebtedness,
determined as of the date of Incurrence of such new Indebtedness, does not
mature prior to the Stated Maturity of the Indebtedness to be refinanced or
refunded, and the Average Life of such new Indebtedness is at least equal to the
remaining Average Life of the Indebtedness to be refinanced or refunded; and
provided further that in no event may Indebtedness of the Company be refinanced
by means of any Indebtedness of any Restricted Subsidiary pursuant to this
clause (iii); (iv) Indebtedness (A) in respect of performance, surety or appeal
bonds provided in the ordinary course of business, (B) under Currency Agreements
and Interest Rate Agreements; provided that such agreements (x) are designed
solely to protect the Company or its Restricted Subsidiaries against
fluctuations in foreign currency exchange rates or interest rates and not for
speculation and (y) do not increase the Indebtedness of the obligor outstanding
at any time other than as a result of fluctuations in foreign currency exchange
rates or interest rates or by reason of fees, indemnifies and compensation
payable thereunder; and (C) arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations, or from
Guarantees or letters of credit, surety bonds or performance bonds securing any
obligations of the Company or any of its Restricted Subsidiaries pursuant to
such agreements, in any case Incurred in connection with the disposition of any
business, assets or Restricted Subsidiary (other than Guarantees of Indebtedness
Incurred by any Person acquiring all or any portion of such business, assets or
Restricted Subsidiary for the purpose of financing such purpose acquisition), in
a principal amount not to exceed the gross proceeds actually received by the
Company or any Restricted Subsidiary in connection with such disposition; (v)
Indebtedness of the Company, to the extent the net proceeds thereof are promptly
(A) used to purchase Notes tendered in an Offer to Purchase made as a result of
a Change in Control or (B) deposited to defease the Notes in accordance with
Article Eight; (vi) Guarantees of the Notes and Guarantees of Indebtedness of
the Company by any Restricted Subsidiary provided the Guarantee of such
Indebtedness is permitted by Section 4.07; (vii) Indebtedness of the Company or
any Restricted Subsidiary, not to exceed $15 million in any fiscal year of the
Company, Incurred to finance capital expenditures; (viii) Indebtedness of the
Company in an aggregate principal amount outstanding at any time not to exceed
the sum of 80% of Eligible Accounts Receivable and 60% of Eligible Inventory;
(ix) Indebtedness of Foreign Subsidiaries in an aggregate principal amount
outstanding at any time not to exceed the greater of (A) $20 million and (B)
one-third of Consolidated EBITDA for the then most recent four fiscal quarters
covered by filings made




                                       2

pursuant to Section 4.18; (x) Indebtedness of Restricted Subsidiaries, not to
exceed $20 million at any time outstanding, secured by real property of such
Restricted Subsidiaries; (xi) Acquired Indebtedness, provided that, pro forma
for the transactions in which such Acquired Indebtedness is Incurred, the
Interest Coverage Ratio would be no less than 2.5:1; and (xii) Indebtedness of
the Company (in addition to Indebtedness permitted under clauses (i) through
(xi) above) in an aggregate principal amount outstanding at any time not to
exceed $70 million, less any amount of such Indebtedness permanently repaid as
provided under Section 4.11.

         (b) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or a Restricted Subsidiary may
Incur pursuant to this Section 4.03 shall not be deemed to be exceeded, with
respect to any outstanding Indebtedness due solely to the result of fluctuations
in the exchange rates of currencies.

         (c) For purposes of determining any particular amount of Indebtedness
under this Section 4.03, (i) Indebtedness Incurred under the Credit Facility on
or prior to the Effective Date shall be treated as Incurred pursuant to clause
(i) of the second paragraph of subsection (a) of this Section 4.03, (ii)
Guarantees, Liens or obligations with respect to letters of credit supporting
Indebtedness otherwise included in the determination of such particular amount
shall not be included and (iii) any Liens granted pursuant to the equal and
ratable provisions referred to in Section 4.09 shall not be treated as
Indebtedness. For purposes of determining compliance with this Section 4.03, in
the event that an item of Indebtedness meets the criteria of more than one of
the types of Indebtedness described in the above clauses (other than
Indebtedness referred to in clause (i) of the preceding sentence), the Company,
in its sole discretion, shall classify, and from time to time may reclassify,
such item of Indebtedness and only be required to include the amount and type of
such Indebtedness in one of such clauses.

         SECTION 4.04.   Limitation on Restricted Payments. (a) The Company
will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, (i) declare or pay any dividend or make distribution on or with to
its Capital Stock (other than (x) dividends any respect or distributions payable
solely in shares of its Capital Stock (other than Disqualified Stock) or in
options, warrants or other rights to acquire shares of such Capital Stock and
(y) pro rata dividends or distributions on Common Stock of Restricted
Subsidiaries held by minority stockholders) held by Persons other than the
Company or any of its Restricted Subsidiaries, (ii) purchase, redeem, retire or
otherwise acquire for value any shares of Capital Stock of (A) the Company or an
Unrestricted Subsidiary (including options, warrants or other rights to acquire
such shares of Capital Stock) held by any Person or (B) a Restricted Subsidiary
(including options, warrants or other rights to acquire such shares of Capital
Stock) held by any Affiliate of the Company (other than a Wholly Owned
Restricted Subsidiary) or any holder (or any Affiliate of such holder) of 5% or
more of the Capital Stock of the Company, (iii) make any voluntary or optional
principal payment, or voluntary or optional redemption, repurchase, defeasance,
or other acquisition or retirement for value, of Indebtedness of the Company
that is subordinated in right of to payment the Notes or (iv) make any
Investment, other than a Permitted Investment, in any Person (such payments or
any other actions described in clauses (i) through (iv) above being collectively
"Restricted Payments") if, at the time of, and after giving effect to, the
proposed Restricted Payment: (A) a Default or Event of Default shall have
occurred and be continuing, (B) except in the case of an Investment, the Company
could not Incur at least $1.00 of Indebtedness under the first paragraph of
Section 4.03 or (C) the aggregate amount of all




                                       30

Restricted Payments (the amount, if other than in cash, to be determined in good
faith by the Board of Directors, whose determination shall be conclusive and
evidenced by a Board Resolution; provided that Restricted Payments, to the
extent made solely in Capital Stock other than Disqualified Stock, shall for
purposes of this clause (C) be deemed to be in an amount equal to zero) made
after the Effective Date shall exceed the sum of (1) 50% of the aggregate amount
of the Adjusted Consolidated Net Income (or, if the Adjusted Consolidated Net
Income is a loss, minus 100% of the amount of such loss) (determined by
excluding income resulting from transfers of assets by the Company or a
Restricted Subsidiary to an Unrestricted Subsidiary) accrued on a cumulative
basis during the period (taken as one accounting period) beginning on the first
day of the fiscal quarter immediately following the Effective Date and ending on
the last day of the last fiscal quarter preceding the Transaction Date for which
reports have been filed with the Commission or provided to the Trustee pursuant
to Section 4.18 plus (2) the aggregate Net Cash Proceeds received by the Company
after the Effective Date from the issuance and sale permitted by this Indenture
of its Capital Stock (other than Disqualified Stock) to a Person who is not a
Subsidiary of the Company, including an issuance or sale permitted by this
Indenture of Indebtedness of the Company for cash subsequent to the Effective
Date upon the conversion of such indebtedness into Capital Stock (other than
Disqualified Stock) of the Company, or from the issuance to a Person who is not
a Subsidiary of the Company of any options, warrants or other rights to acquire
Capital Stock of the Company (in each case, exclusive of any Disqualified Stock
or any options, warrants or other rights that are redeemable at the option of
the holder, or are required to be redeemed, prior to the Stated Maturity of the
Notes) plus (3) an amount equal to the net reduction in outstanding Investments
(other than reductions in outstanding Permitted Investments) in any Person
resulting from payments of interest on Indebtedness, dividends, repayments of
loans or advances, or other payments transfers of assets, in each case to the
Company or any Restricted Subsidiary or from the Net Cash Proceeds from the sale
of any such Investment (except, in each case, to the extent any such payment or
proceeds are included in the calculation of Adjusted Consolidated Net Income),
or from redesignations of Unrestricted Subsidiaries as Restricted Subsidiaries
(valued in each case as provided in the definition of "Investments"), not to
exceed, in each case, the amount of Investments previously made by the Company
or any Restricted Subsidiary in such Person or Unrestricted Subsidiary plus (4)
$10 million. The amount of any Investment "outstanding" at any time shall be
deemed to be equal to the amount of such Investment on the date made, less the
return of capital to the Company and its Restricted Subsidiaries with respect to
such Investment (up to the amount of such Investment on the date made).
Notwithstanding anything herein to the contrary, Investments made through the
transfer of equipment shall be valued at the book value at the time of
Investment with respect to such equipment.

         (b) The foregoing provision shall not be violated by reason of: (i) the
payment of any dividend within 60 days after the date of declaration thereof if,
at said date of declaration, such payment would comply with the foregoing
paragraph; (ii) the redemption, repurchase, defeasance or other acquisition or
retirement for value of Indebtedness that is subordinated in right of payment to
the Notes including Redemption Price, and accrued and unpaid interest, with the
proceeds of, or in exchange for, Indebtedness Incurred under clause (iii) of the
second paragraph of Section 4.03(a); (iii) the repurchase, redemption or other
acquisition of Capital Stock of the Company or an Unrestricted Subsidiary (or
options, warrants or other rights to acquire such Capital Stock) in exchange
for, or out of the proceeds of a substantially concurrent offering of, shares of
Capital Stock (other than Disqualified Stock) of the Company (or options,




                                       31

warrants or other rights to acquire such Capital Stock); (iv) the making of any
principal payment or the repurchase, redemption, retirement, defeasance or other
acquisition for value of Indebtedness of the Company which is subordinated in
right of payment to the Notes in exchange for, or out of the proceeds of, a
substantially concurrent offering of, shares of the Capital Stock (other than
Disqualified Stock) of the Company (or options, warrants or other rights to
acquire such Capital Stock); (v) payments or distributions, to dissenting
stockholders pursuant to applicable law, pursuant to or in connection with a
consolidation, merger or transfer of assets that complies with the provisions of
Article Five; or (vi) payment of (a) amounts necessary to pay taxes, in an
amount not to exceed the amount of taxes that the Company and its Subsidiaries
would pay on a stand-alone basis, plus (b) amounts payable in respect of the
Management Services Agreement.

         (c) Each Restricted Payment permitted pursuant to paragraph (b) of this
Section 4.04 (other than the Restricted Payment referred to in clause (ii)
thereof and an exchange of Capital Stock for Capital Stock or Indebtedness
referred to in clause (iii) or (iv) thereof), and the Net Cash Proceeds from any
issuance of Capital Stock referred to in clauses (iii) and (iv) thereof, shall
be included in calculating whether the conditions of clause (C) of the first
paragraph of this Section 4.04 have been met with respect to any subsequent
Restricted Payments. In the event the proceeds of an issuance of Capital Stock
of the Company are used for the redemption, repurchase or other acquisition of
the Notes, or Indebtedness that is pari passu with the Notes, then the Net Cash
Proceeds of such issuance shall be included in clause (C) of the first paragraph
of this Section 4.04 only to the extent such proceeds are not used for such
redemption, repurchase or other acquisition of Indebtedness.

         SECTION 4.05.  Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Restricted Subsidiary to (i) pay dividends or make any other
distributions permitted by applicable law on any Capital Stock of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary,
(ii) pay any Indebtedness owed to the Company or any other Restricted
Subsidiary, (iii) make loans or advances to the Company or any other Restricted
Subsidiary or (iv) transfer any of its property or assets to the Company or any
other Restricted Subsidiary.

         The foregoing provisions shall not restrict any encumbrances or
restrictions: (i) existing on the Effective Date in the Credit Facility, this
Indenture or any other agreements in effect on the Effective Date or
contemplated by the Plan, and any extensions, refinancings, renewals or
replacements of such agreements; provided that the encumbrances and restrictions
in any such extensions, refinancings, renewals or replacements are no less
favorable in any material respect to the Holders than those encumbrances or
restrictions that are then in effect and that are being extended, refinanced,
renewed or replaced; (ii) existing under or by reason of applicable law; (iii)
with respect to any Person or the property or assets of such Person acquired by
the Company or any Restricted Subsidiary, existing at the time of such
acquisition and not incurred in contemplation thereof, which encumbrances or
restrictions are not applicable to any Person or the property or assets of any
Person other than such Person or the property or assets of such Person so
acquired; (iv) in the case of clause (iv) of the first paragraph of this Section
4.05, (A) that restrict in a customary manner the subletting, assignment or
transfer of any property or asset




                                       32

that is a lease, license, conveyance or contract or similar property or asset,
(B) existing by virtue of any transfer of, agreement to transfer, option or
right with respect to, or Lien on, any property or assets of the Company or any
Restricted Subsidiary not otherwise prohibited by this Indenture or (C) arising
or agreed to in the ordinary course of business, not relating to any
indebtedness and that do 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; (v) with respect to
a Restricted Subsidiary and imposed pursuant to an agreement that has been
entered into for the sale or disposition of all or substantially all of the
Capital Stock of, or property and assets of, such Restricted Subsidiary; (vi)
encumbrances or restrictions relating solely to Foreign Subsidiaries that
support Indebtedness Incurred under clause (ix) of the second paragraph of
paragraph (a) of Section 4.03; or (vii) existing with respect to any
Unrestricted Subsidiary at the time it is designated or deemed to become a
Restricted Subsidiary. Nothing contained in this Section 4.05 shall prevent the
Company or any Restricted Subsidiary from (1) creating, incurring, assuming or
suffering to exist any Liens otherwise permitted under Section 4.09 or (2)
restricting the sale or other disposition of property or assets of the Company
or any of its Restricted Subsidiaries that secure Indebtedness of the Company or
any of its Restricted Subsidiaries.

         SECTION 4.06.  Limitation on the Issuance and Sale of Capital Stock
of Restricted Subsidiaries. The Company will not sell, and will not permit any
Restricted Subsidiary to, directly or indirectly, to issue or sell, any shares
of Capital Stock of a Restricted Subsidiary (including options, warrants or
other rights to purchase shares of such Capital Stock) except (i) to the Company
or a Wholly Owned Restricted Subsidiary; (ii) issuances of director's qualifying
shares or sales to foreign nationals of shares of Capital Stock of foreign
Restricted Subsidiaries, to the extent required by applicable law; (iii) if,
immediately after giving effect to such issuance or sale, 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 4.04 if made on the date of such
issuance or sale; (iv) and the issuance or sale of Common Stock of any
Restricted Subsidiaries if the proceeds thereof are applied in accordance with
Section 4.11.

         SECTION 4.07.  Limitation on Issuances of Guarantees by Restricted
Subsidiaries. The Company will not permit any Restricted Subsidiary, directly or
indirectly, to Guarantee any Indebtedness of the Company which is pari passu
with or subordinate in right of payment to the Notes ("Guaranteed
Indebtedness"), unless (i) such Restricted Subsidiary simultaneously executes
and delivers a supplemental indenture to this Indenture providing for a
Guarantee (a "Subsidiary Guarantee") of payment of the Notes by such Restricted
Subsidiary and (ii) such Restricted Subsidiary waives and will not in any manner
whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary as a result of any payment by such Restricted
Subsidiary under its Subsidiary Guarantee; provided that this paragraph shall
not be applicable to any Guarantee of any Restricted Subsidiary (x) that existed
at the time such Person became a Restricted Subsidiary and was not Incurred in
connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary or (y) of the Indebtedness Incurred under the Credit Facility. If the
Guaranteed Indebtedness is (A) pari passu with the Notes, then the Guarantee of
such Guaranteed Indebtedness




                                       33

shall be pari passu with, or subordinated to, the Subsidiary Guarantee or (B)
subordinated to the Notes, then the Guarantee of such Guaranteed Indebtedness
shall be subordinated to the Subsidiary Guarantee at least to the extent that
the Guaranteed Indebtedness is subordinated to the Notes.

         Notwithstanding the foregoing, any Subsidiary Guarantee by a Restricted
Subsidiary may provide by its terms that it shall be automatically and
unconditionally released and discharged upon (i) any sale, exchange or transfer,
to any Person not an Affiliate of the Company, of all of the Company's and each
other Restricted Subsidiary's Capital Stock in, or all or substantially all the
assets of, such Restricted Subsidiary (which sale, exchange or transfer is not
prohibited by this Indenture) or (ii) the release or discharge of the Guarantee
which resulted in the creation of such Subsidiary Guarantee, except a discharge
or release by or as a result of payment under such Guarantee.

         SECTION 4.08.  Limitation on Transactions with Shareholders and
Affiliates. The Company will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, enter into, renew or extend any transaction
(including, without limitation, the purchase, sale, lease or exchange of
property or assets, or the rendering of any service) with any holder (or any
Affiliate of such holder other than an entity that is an Affiliate solely by
reason of being a Subsidiary of the Company) of 5% or more of any class of
Capital Stock of the Company or with any Affiliate of the Company or any
Restricted Subsidiary, except upon fair and reasonable terms no less favorable
to the Company or such Restricted Subsidiary than could be obtained, at the time
of such transaction or, if such transaction is pursuant to a written agreement,
at the time of the execution of the agreement providing therefor, in a
comparable arm's-length transaction with a Person that is not such a holder or
an Affiliate of the Company.

         The foregoing limitation does not limit, and shall not apply to (i)
transactions (A) approved by a majority of the disinterested members of the
Board of Directors or (B) for which the Company or a Restricted Subsidiary
delivers to the Trustee a written opinion of a nationally recognized firm having
expertise in the specific area which is the subject of such determination
stating that the transaction is fair to the Company or its Restricted
Subsidiaries from a financial point of view; (ii) any transaction solely between
the Company and any of its Wholly Owned Restricted Subsidiaries or solely
between Wholly Owned Restricted Subsidiaries; (iii) the payment of reasonable
and customary regular fees to directors of the Company who are not employees of
the Company; (iv) any payments or other transactions pursuant to any tax-sharing
agreement between the Company and any other Person with which the Company files
a consolidated tax return or with which the Company is part of a consolidated
group for tax purposes; (v) any Restricted Payments not prohibited under Section
4.04, (vi) the Management Services Agreement or any payments made pursuant
thereto or (vii) 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 or incentive plans
approved by the Board of Directors. Notwithstanding the foregoing, any
transaction or series of related transactions covered by the first paragraph of
this Section 4.08 and not covered by clauses (ii) through (vi) of this
paragraph, the aggregate amount of which (until after the Stated Maturity of the
Notes) exceeds $1 million in value, must be approved or determined to be fair in
the manner provided for in clause (i)(A) or (B) above.

         SECTION 4.09.  Limitation on Liens. The Company will not, and will
not permit any Restricted Subsidiary to, create, incur, assume or suffer to
exist any Lien on any of its assets




                                       34

or properties of any character, or any shares of Capital Stock or Indebtedness
of any Restricted Subsidiary, without making effective provision for all of the
Notes and all other amounts due under this Indenture to be secured equally and
ratably with (or, if the obligation or liability to be secured by such Lien is
subordinated in right of payment to the Notes or any Note Guaranty, prior to)
the obligation or liability secured by such Lien for so long as such obligations
are so secured.

         The foregoing limitation does not apply to (i) Liens existing on the
Effective Date, including Liens securing obligations under the Credit Facility;
(ii) Liens granted after the Effective Date on any assets or Capital Stock of
the Company or its Restricted Subsidiaries created in favor of the Holders;
(iii) Liens with respect to the assets of a Restricted Subsidiary granted by
such Restricted Subsidiary to the Company or a Wholly Owned Restricted
Subsidiary to secure Indebtedness owing to the Company or such other Restricted
Subsidiary; (iv) Liens securing Indebtedness which is Incurred to refinance
secured Indebtedness which is permitted to be Incurred under the second
paragraph of Section 4.03; provided that such Liens do not extend to or cover
any property or assets of the Company or any Restricted Subsidiary other than
the property or assets securing the Indebtedness being refinanced; (v) Liens on
any property or assets of a Restricted Subsidiary securing Indebtedness of such
Restricted Subsidiary permitted under Section 4.03; (vi) Liens with respect to
real property to secure Indebtedness Incurred pursuant to clause (x) of the
second paragraph of Section 4.03(a) or (vii) Permitted Liens.

         SECTION 4.10.  Limitation on Sale-Leaseback Transactions. The
Company will not, and will not permit any Restricted Subsidiary to, enter into
any sale-leaseback transaction involving any of its assets or properties whether
now owned or hereafter acquired, whereby the Company or a Restricted Subsidiary
sells or transfers such assets or properties and then or thereafter leases such
assets or properties or any part thereof or any other assets or properties which
the Company or such Restricted Subsidiary, as the case may be, intends to use
for substantially the same purpose or purposes as the assets or properties sold
or transferred.

         The foregoing restriction does not apply to any sale-leaseback
transaction if the Company complies with Section 4.11 in respect of such
transaction and (i) the lease is for a period, including renewal rights, of not
in excess of three years; (ii) the lease secures or relates to industrial
revenue or pollution control bonds; (iii) the transaction is solely between the
Company and any Wholly Owned Restricted Subsidiary or solely between Wholly
Owned Restricted Subsidiaries; (iv) the transaction would result in the
Incurrence of Indebtedness by a Restricted Subsidiary permitted pursuant to
Section 4.03 and 4.09; or (v) the Company or such Restricted Subsidiary, within
12 months after the sale or transfer of any assets or properties is completed,
applies an amount not less than the net proceeds received from such sale in
accordance with clause (A) or (B) of the first paragraph of Section 4.11.

         SECTION 4.11.  Limitation on Asset Sales. The Company will not, and
will not permit any Restricted Subsidiary to, consummate any Asset Sale, unless
(i) the consideration received by the Company or such Restricted Subsidiary is
at least equal to the fair market value of the assets sold or disposed of, as
determined in good faith by the Board of Directors, and (ii) at least 75% of the
consideration received consists of cash or Temporary Cash Investments. In the
event and to the extent that the Net Cash Proceeds received by the Company or
any of its Restricted Subsidiaries from one or more Asset Sales occurring on or
after the Effective Date in




                                       35

any period of 12 consecutive months exceed 10% of Adjusted Consolidated Net
Tangible Assets (determined as of the date closest to the commencement of such
12-month period for which a consolidated balance sheet of the Company and its
Subsidiaries has been filed with the Commission pursuant to Section 4.18), then
the Company shall or shall cause the relevant Restricted Subsidiary to (ii)
within twelve months after the date Net Cash Proceeds so received exceed 10% of
Adjusted Consolidated Net Tangible Assets (A) apply an amount equal to such
excess Net Cash Proceeds to permanently repay unsubordinated Indebtedness of the
Company, or any Restricted Subsidiary providing a Subsidiary Guarantee pursuant
to Section 4.07 or Indebtedness of any other Restricted Subsidiary, in each case
owing to a Person other than the Company or any of its Restricted Subsidiaries
or (B) invest an equal amount, or the amount not so applied pursuant to clause
(A) (or enter into a definitive agreement committing to so invest within 12
months after the date of such agreement), in property or assets (other than
current assets) of a nature or type or that are used in a business (or in a
company having property and assets of a nature or type, or engaged in a
business) similar or related to the nature or type of the property and assets
of, or the business of, the Company and its Restricted Subsidiaries existing on
the date of such investment and (ii) apply (no later than the end of the
12-month period referred to in clause (i)) such excess Net Cash Proceeds (to the
extent not applied pursuant to clause (i)) as provided in the following
paragraph of this Section 4.11. The amount of such excess Net Cash Proceeds
required to be applied (or to be committed to be applied) during such 12-month
period as set forth in clause (i) of the preceding sentence and not applied as
so required by the end of such period shall constitute "Excess Proceeds."

         Notwithstanding the foregoing, to the extent that any or all of the Net
Cash Proceeds of any Asset Sale of assets based outside the United States are
prohibited or delayed by applicable local law from being repatriated to the
United States and such Net Cash Proceeds are not actually applied in accordance
with the foregoing paragraphs, the Company shall not be required to apply the
portion of such Net Cash Proceeds so affected but may permit the applicable
Restricted Subsidiaries to retain such portion of the Net Cash Proceeds so long,
but only so long, as the applicable local law will not permit repatriation to
the United States (the Company hereby agreeing to cause the applicable
Restricted Subsidiary to promptly take all actions required by the applicable
local law to permit such repatriation) and once such repatriation of any such
affected Net Cash Proceeds is permitted under the applicable local law, such
repatriation will be immediately effected and such repatriated Net Cash Proceeds
will be applied in the manner set forth in this covenant as if the Asset Sale
had occurred on such date; provided that to the extent that the Company has
determined in good faith that repatriation of any or all of the Net Cash
Proceeds of such Asset Sale would have a material adverse tax cost consequence,
the Net Cash Proceeds so affective may be retained by the applicable Restricted
Subsidiary for so long as such material adverse tax cost event would continue.

         If, as of the first day of any calendar month, the aggregate amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to this
Section 4.11 totals at least $20 million, the Company shall commence, not later
than the fifteenth Business Day of such month, and consummate an Offer to
Purchase from the Holders on a pro rata basis an aggregate principal amount of
Notes equal to the Excess Proceeds on such date, at a purchase price equal to
100% of the principal amount of the Notes, plus, in each case, accrued interest
(if any) to the Payment Date.





                                       36

         SECTION 4.12.  Repurchase of Notes upon a Change of Control. The
Company shall commence, within 30 days after the occurrence of a Change of
Control, and consummate an Offer to Purchase for all Notes then outstanding, at
a purchase price equal to 101% of the principal amount thereof, plus accrued
interest, if any, to the Payment Date.

         SECTION 4.13.  Existence. Subject to Article Five of this Indenture,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its existence and the existence of each of its
Restricted Subsidiaries in accordance with the respective organizational
documents of the Company and each such Restricted Subsidiary and the material
rights (whether pursuant to charter, partnership certificate, agreement, statute
or otherwise), licenses and franchises of the Company and each such Restricted
Subsidiary; provided that the Company shall not be required to preserve any such
right, license or franchise, or the existence of any Restricted Subsidiary, if
the maintenance or preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries taken as a whole and
provided further that this Section 4.12 does not prohibit any transaction
otherwise permitted pursuant to Section 4.11.

         SECTION 4.14.  Payment of Taxes and Other Claims. The Company will
pay or discharge and shall cause each of its Restricted Subsidiaries to pay or
discharge, or cause to be paid or discharged, before the same shall become
delinquent (i) all material taxes, assessments and governmental charges levied
or imposed upon (a) the Company or any such Restricted Subsidiary, (b) the
income or profits of any such Restricted Subsidiary which is a corporation or
(c) the property of the Company or any such Restricted Subsidiary and (ii) all
material lawful claims for labor, materials and supplies that, if unpaid, might
by law become a lien upon the property of the Company or any such Restricted
Subsidiary; provided that the Company shall not be required to pay or discharge,
or cause to be paid or discharged, any such tax, assessment, charge or claim the
amount, applicability or validity of which is being contested in good faith by
appropriate proceedings and for which adequate reserves have been established.

         SECTION 4.15. Maintenance of Properties and Insurance. The Company will
cause all properties used or useful in the conduct of its business or the
business of any of its Restricted Subsidiaries to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided that nothing in
this Section 4.15 shall prevent the Company or any such Restricted Subsidiary
from discontinuing the use, operation or maintenance of any of such properties
or disposing of any of them, if such discontinuance or disposal is, in the
judgment of the Company, desirable in the conduct of the business of the Company
and its Restricted Subsidiaries taken as a whole.

         The Company will provide or cause to be provided, for itself and its
Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds customarily insured against by corporations
similarly situated and owning like properties, including, but not limited to,
products liability insurance and public liability insurance, with reputable
insurers or with the government of the United States of America, or an agency or
instrumentality thereof, in such amounts, with such deductibles and by such
methods as shall be




                                       37

customary for corporations similarly situated in the industry in which the
Company or any such Restricted Subsidiary, as the case may be, is then
conducting business.

         SECTION 4.16.  Notice of Defaults. In the event that any Officer
becomes aware of any Default or Event of Default, the Company, promptly after it
becomes aware thereof, will give written notice thereof to a Responsible Officer
of the Trustee.

         SECTION 4.17. Compliance Certificates. (a) The Company shall deliver to
the Trustee, within 90 days after the end of each fiscal quarter (120 days after
the end of the last fiscal quarter of each year), an Officers' Certificate
stating whether or not the signers know of any Default or Event of Default that
occurred during such fiscal quarter. In the case of the Officers' Certificate
delivered within 120 days after the end of the Company's fiscal year, such
certificate shall contain a certification from the principal executive officer,
principal financial officer or principal accounting officer of the Company that
a review has been conducted of the activities of the Company and its Restricted
Subsidiaries and the Company's and its Restricted Subsidiaries' performance
under this Indenture and that the Company has complied with all conditions and
covenants under this Indenture. For purposes of this Section 4.17, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture. If any of the Officers of
the Company signing such certificate has knowledge of such a Default or Event of
Default, the certificate shall describe any such Default or Event of Default and
its status. The first certificate to be delivered pursuant to this Section
4.17(a) shall be for the first fiscal quarter beginning after the execution of
this Indenture.

         (b) The Company shall deliver to the Trustee, within 120 days after the
end of each fiscal year, beginning with the fiscal year in which this Indenture
was executed, a certificate signed by the Company's independent certified public
accountants stating (i) that their audit examination has included a review of
the terms of this Indenture and the Notes as they relate to accounting matters,
(ii) that they have read the most recent Officers' Certificate delivered to the
Trustee pursuant to paragraph (a) of this Section 4.16 and (iii) whether, in
connection with their audit examination, anything came to their attention that
caused them to believe that the Company was not in compliance with any of the
terms, covenants, provisions or conditions of Article Four and Section 5.01 of
this Indenture as they pertain to accounting matters and, if any Default or
Event of Default has come to their attention, specifying the nature and period
of existence thereof; provided that such independent certified public
accountants shall not be liable in respect of such statement by reason of any
failure to obtain knowledge of any such Default or Event of Default that would
not be disclosed in the course of an audit examination conducted in accordance
with generally accepted auditing standards in effect at the date of such
examination.

         SECTION 4.18.  Reporting Requirements. (a) The Company shall supply
to the Trustee and each Holder as soon as available and in any event not later
than 60 days after the end of each of the first three quarters of each fiscal
year of the Company, the consolidated balance sheet of the Company and its
Subsidiaries as the end of such quarter and the consolidated statements of
income and cash flows of the Company and its Subsidiaries for such period, all
in reasonable detail and duly certified (subject to year-end audit adjustments
and the lack of footnotes) by an authorized financial officer of the Company as
having been prepared in accordance with GAAP.





                                       38

         The Company shall supply to the Trustee and each Holder as soon as
available and in any event not later than 105 days after the end of each fiscal
year of the Company, a copy of the annual audit report for such year for the
Company and its Subsidiaries, including therein the consolidated balance sheet
of the Company and its Subsidiaries as of the end of such fiscal year and
consolidated statements of income and cash flows of the Company and its
Subsidiaries for such fiscal year, in each case prepared in accordance with
GAAP.

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

         SECTION 4.19.  Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of, Redemption Price or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or that may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Company hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.

                                  ARTICLE FIVE
                              SUCCESSOR CORPORATION

         SECTION 5.01.  When Company May Merge, Etc. The Company shall not
consolidate with, merge with or into, or sell, convey, transfer, lease or
otherwise dispose of all or substantially all of its property and assets (as an
entirety or substantially an entirety in one transaction or a series of related
transactions) to, any Person or permit any Person to merge with or into the
Company unless: (i) the Company shall be the continuing Person, or the Person
(if other than the Company) formed by such consolidation or into which the
Company is merged or that acquired or leased such property and assets of the
Company shall be a corporation organized and validly existing under the laws of
the United States of America or any jurisdiction thereof and shall expressly
assume, by a supplemental indenture, executed and delivered to the Trustee, all
of the obligations of the Company on all of the Notes and under this Indenture;
(ii) immediately after giving effect to such transaction, no Default or Event of
Default shall have occurred and be continuing; (iii) immediately after giving
effect to such transaction on a pro forma basis, the Company or any Person
becoming the successor obligor of the Notes shall have a Consolidated Net Worth
equal to or greater than the Consolidated Net Worth of the Company immediately
prior to such transaction; (iv) immediately after giving effect to such
transaction on a pro forma basis the Company, or any Person becoming the
successor obligor of the Notes, as the case may be, could Incur at least $1.00
of Indebtedness under the first paragraph of Section 4.03; provided that this
clause (iv) shall not apply to a consolidation, merger or sale of all (but not
less than all) of the assets of the Company if all Liens and Indebtedness of the




                                       39

Company or any Person becoming the successor obligor on the Notes, as the case
may be, and its Restricted Subsidiaries outstanding immediately after such
transaction would, if Incurred at such time, have been permitted to be Incurred
(and all such Liens and Indebtedness, other than Liens and Indebtedness of the
Company and its Restricted Subsidiaries outstanding immediately prior to the
transaction, shall be deemed to have been Incurred) for all purposes of this
Indenture; and (v) the Company delivers to the Trustee an Officers' Certificate
(attaching the arithmetic computations to demonstrate compliance with clauses
(iii) and (iv)) and Opinion of Counsel, in each case stating that such
consolidation, merger or transfer and such supplemental indenture comply with
this provision and that all conditions precedent provided for herein relating to
such transaction have been complied with; provided, however, that clauses (iii)
and (iv) above do not apply if, in the good faith determination of the Board of
Directors of the Company, whose determination shall be evidenced by a Board
Resolution, the principal purpose of such transaction is to change the state of
incorporation of the Company; and provided further that any such transaction
shall not have as one of its purposes the evasion of the foregoing limitations.

         SECTION 5.02.  Successor Substituted. Upon any consolidation or
merger, or any sale, conveyance, transfer, lease or other disposition of all or
substantially all of the property and assets of the Company in accordance with
Section 5.01 of this Indenture, the successor Person formed by such
consolidation or into which the Company is merged or to which such sale,
conveyance, transfer, lease or other disposition is made shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein; provided that the Company shall not be released from its
obligation to pay the principal of, Redemption Price or interest on the Notes in
the case of a lease of all or substantially all of its property and assets.

                                   ARTICLE SIX
                              DEFAULT AND REMEDIES

         SECTION 6.01.  Events of Default. Any of the following events shall
constitute an "Event of Default" hereunder:

                  (a) the Company defaults in the payment of the principal of
         (or Redemption Price of) any Note when the same becomes due and payable
         at its Maturity, upon acceleration or redemption, or otherwise (other
         than pursuant to an Offer to Purchase);

                  (b) the Company defaults in the payment of interest on any
         Note when the same becomes due and payable, and such default continues
         for a period of 30 days;

                  (c) the Company defaults in the performance of, or breaches
         the provisions of, Article Five or fails to make or consummate an Offer
         to Purchase in accordance with Section 4.11 or Section 4.12;

                  (d) the Company defaults in the performance of or breaches any
         covenant or agreement of the Company in this Indenture or under the
         Notes (other than a default specified in clause (a), (b) or (c) above),
         and such default or breach continues for a period of 30 consecutive
         days after written notice to the Company by the Trustee or to the
         Company and the Trustee by the Holders of 25% or more in aggregate
         principal amount of the Notes then Outstanding;

                  (e) there occurs with respect to any issue or issues of
         Indebtedness of the Company or any Significant Subsidiary having an
         outstanding principal amount of $10 million or more in the aggregate
         for all such issues of all such Persons, whether such Indebtedness
         exists on the Effective Date or shall hereafter be created, (I) an
         event of default that has caused the holder thereof to declare such
         Indebtedness to be due and payable prior to its Stated Maturity and
         such Indebtedness has not been discharged in full or such acceleration
         has not been rescinded or annulled within 30 days of such acceleration
         and/or (II) the failure to make a principal payment at the final (but
         not any interim) fixed maturity and such defaulted payment shall not
         have been made, waived or extended within 30 days of such payment
         default;

                  (f) any final judgment or order (not covered by insurance) for
         the payment of money in excess of $10 million in the aggregate for all
         such final judgments or orders against all such Persons (treating any
         deductibles, self-insurance or retention as not so covered) shall be
         rendered against the Company or any Significant Subsidiary and shall
         not be paid or discharged, and there shall be any period of 30
         consecutive days following entry of the final judgment or order that
         causes the aggregate amount for all such final judgments or orders
         outstanding and not paid or discharged against all such Persons to
         exceed $10 million during which a stay of enforcement of such final
         judgment or order, by reason of a pending appeal or otherwise, shall
         not be in effect;

                  (g) a court having jurisdiction in the premises enters a
         decree or order for (A) relief in respect of the Company or any
         Significant Subsidiary in an involuntary case under any applicable
         bankruptcy, insolvency or other similar law now or hereafter in effect,
         (B) appointment of a receiver, liquidator, assignee, custodian,
         trustee, sequestrator or similar official of the Company or any
         Significant Subsidiary or for all or substantially all of the property
         and assets of the Company or any Significant Subsidiary or (C) the
         winding up or liquidation of the affairs of the Company or any
         Significant Subsidiary and, in each case, such decree or order shall
         remain unstayed and in effect for a period of 60 consecutive days; or

                  (h) the Company or any Significant Subsidiary (A) commences a
         voluntary case under any applicable bankruptcy, insolvency or other
         similar law now or hereafter in effect, or consents to the entry of an
         order for relief in an involuntary case under any such law, (B)
         consents to the appointment of or taking possession by a receiver,
         liquidator, assignee, custodian, trustee, sequestrator or similar
         official of the Company or any Significant Subsidiary or for all or
         substantially all of the property and assets of the Company or any
         Significant Subsidiary or (C) effects any general assignment for the
         benefit of creditors.

         SECTION 6.02.  Acceleration. If an Event of Default (other than an
Event of Default specified in clause (g) or (h) of Section 6.01 that occurs with
respect to the Company) occurs and is continuing under this Indenture, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then Outstanding, by written notice to the Company




                                       41

(and to the Trustee if such notice is given by the Holders), may, and the
Trustee at the request of such Holders shall, declare the principal of, and
accrued interest on the Notes to be immediately due and payable. Upon a
declaration of acceleration, such principal, and accrued interest shall be
immediately due and payable. In the event of a declaration of acceleration
because an Event of Default set forth in clause (e) of Section 6.01 has occurred
and is continuing, such declaration of acceleration shall be automatically
rescinded and annulled if the event of default triggering such Event of Default
pursuant to clause (e) shall be remedied or cured by the Company or the relevant
Significant Subsidiary or waived by the holders of the relevant Indebtedness
within 60 days after the declaration of acceleration with respect thereto. If an
Event of Default specified in clause (g) or (h) of Section 6.01 occurs with
respect to the Company, the principal of, and accrued interest on the Notes then
Outstanding shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder.

         The Holders of at least a majority in principal amount of the
Outstanding Notes by written notice to the Company and to the Trustee, may waive
all past defaults and rescind and annul a declaration of acceleration and its
consequences if (i) all existing Events of Default, other than the nonpayment of
the principal of, Redemption Price, and interest on the Notes that have become
due solely by such declaration of acceleration, have been cured or waived and
(ii) the rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.

         SECTION 6.03.  Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may, and at the direction of the Holders of at least a
majority in principal amount of the Outstanding Notes shall, pursue any
available remedy by proceeding at law or in equity to collect the payment of
principal of, Redemption Price, or interest on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.

         The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding.

         SECTION 6.04.  Waiver of Past Defaults. Subject to Sections 6.02,
6.07 and 9.02(b), the Holders of at least a majority in principal amount of the
Outstanding Notes, by notice to the Trustee, may waive an existing Default or
Event of Default and its consequences, except a Default in the payment of
principal of, Redemption Price, or interest on any Note as specified in clause
(a) or (b) of Section 6.01 or in respect of a covenant or provision of this
Indenture which cannot be modified or amended without the consent of the Holder
of each Outstanding Note affected. 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 Event of Default or impair any
right consequent thereto.

         SECTION 6.05.  Control by Majority. The Holders of at least a
majority in aggregate principal amount of the Outstanding Notes may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee. However,
the Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that may involve the Trustee in personal liability, or that the
Trustee determines in good faith may be unduly prejudicial to the rights of
Holders of Notes not




                                       42

joining in the giving of such direction and may take any other action it deems
proper that is not inconsistent with any such direction received from Holders of
Notes.

         SECTION 6.06.  Limitation on Suits. Except as otherwise required by
Section 6.07(a),a Holder may not institute any proceeding, judicial or
otherwise, with respect to this Indenture or the Notes, or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless:

                  (i) the Holder has previously given the Trustee written notice
         of a continuing Event of Default;

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

                  (iii) such Holder or Holders offer (and if requested provide)
         the Trustee indemnity satisfactory to the Trustee against any costs,
         liability or expense to be incurred in compliance with such request;

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

                  (v) during such 60-day period, the Holders of a majority in
         aggregate principal amount of the Outstanding Notes do not give the
         Trustee a direction that is inconsistent with the request.

         For purposes of Section 6.05 of this Indenture and this Section 6.06,
the Trustee shall comply with TIA Section 316(a) in making any determination of
whether the Holders of the required aggregate principal amount of Outstanding
Notes have concurred in any request or direction of the Trustee to pursue any
remedy available to the Trustee or the Holders with respect to this Indenture or
the Notes or otherwise under the law.

         A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.

         SECTION 6.07.  Rights of Holders to Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of the principal of, Redemption Price, or interest on, such Note
or to bring suit for the enforcement of any such payment, on or after the due
date expressed in the Notes, shall not be impaired or affected without the
consent of such Holder.

         SECTION 6.08.  Collection Suit by Trustee. If an Event of Default in
payment of principal, premium or interest specified in clause (a), (b) or (c),
of Section 6.01 occurs and is continuing, the Trustee may recover judgment in
its own name and as trustee of an express trust against the Company or any other
obligor of the Notes for the whole amount of principal, Redemption Price, and
accrued interest remaining unpaid, together with interest on overdue principal,
Redemption Price, and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate specified
in the Notes, and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the




                                       43

reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.

         SECTION 6.09.  Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07) and the Holders allowed in any judicial proceedings relative to
the Company (or any other obligor of the Notes), its creditors or its property
and shall be entitled and empowered to collect and receive any monies,
securities or other property payable or deliverable upon conversion or exchange
of the Notes or upon any such claims and to distribute the same, and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official 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. Nothing herein contained shall be
deemed to empower 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 thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding

         SECTION 6.10.  Priorities. If the Trustee collects any money
pursuant to this Article Six, it shall pay out the money in the following order:

                  First: to the Trustee for all amounts due under Section 7.07;

                  Second: to Holders for amounts then due and unpaid for
         principal of, Redemption Price, and interest on the Notes in respect of
         which or for the benefit of which such money has been collected,
         ratably, without preference or priority of any kind, according to the
         amounts due and payable on such Notes for principal, Redemption Price,
         and interest, respectively; and

                  Third: to the Company or as a court of competent jurisdiction
         may direct.

         The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Holders pursuant to this Section 6.10.

         SECTION 6.11.  Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court may
require any party litigant in such suit to file an undertaking to pay the costs
of the suit, and the court may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07, or a suit by Holders of more than 10% in
principal amount of the Outstanding Notes.





                                       44

         SECTION 6.12.  Restoration of Rights and Remedies. If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then,
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Company, Trustee and the Holders shall continue as though no
such proceeding had been instituted.

         SECTION 6.13.  Right and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or wrongfully taken Notes in Section 2.06, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.

         SECTION 6.14.  Delay or Omission Not Waiver. No delay or omission of
the Trustee or of any Holder to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an acquiescence therein. Every right and remedy
given by this Article Six or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders, as the case may be.

                                 ARTICLE SEVEN
                                     TRUSTEE

         SECTION 7.01.  General. The duties and responsibilities of the
Trustee shall be as provided by the TIA and as set forth herein. Notwithstanding
the foregoing, no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it. Whether or not herein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Article Seven.

         SECTION 7.02.  Certain Rights of Trustee. Subject to TIA Sections
315(a) through (d):

                  (i) the Trustee may conclusively rely, and shall be protected
         in acting or refraining from acting, upon any resolution, certificate,
         statement, instrument, opinion, report, notice, request, direction,
         consent, order, bond, debenture, note, other evidence of indebtedness
         or other paper or document (whether in original or facsimile form)
         believed by it to be genuine and to have been signed or presented by
         the proper person;





                                       45

                  (ii) before the Trustee acts or refrains from acting, it may
         require an Officers' Certificate or an Opinion of Counsel, which shall
         conform to Section 10.04. The Trustee shall not be liable for any
         action it takes or omits to take in good faith in reliance, on such
         certificate or opinion;

                  (iii) the Trustee may act through its attorneys and agents and
         shall not be responsible for the misconduct or negligence of any
         attorney or agent appointed with due care by it hereunder;

                  (iv) 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 reasonable 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;

                  (v) 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
         its rights or powers, provided that the Trustee's conduct does not
         constitute gross negligence or bad faith;

                  (vi) whenever in the administration of this Indenture the
         Trustee shall deem it desirable that a matter be proved or established
         prior to taking, suffering or omitting any action hereunder, the
         Trustee (unless other evidence be herein specifically prescribed) may,
         in the absence of bad faith on its part, rely upon an Officers'
         Certificate;

                  (vii) the Trustee shall not be bound to make any investigation
         into the facts or matters stated in any resolution, certificate,
         statement, instrument, opinion, report, notice, request, direction,
         consent, order, bond, debenture, note, other evidence of indebtedness
         or other paper or document, but the Trustee, in its discretion, may
         make such further inquiry or investigation into such facts or matters
         as it may see fit, and, if the Trustee shall determine to make such
         further inquiry or investigation, it shall be entitled to examine the
         books, records and premises of the Company personally or by agent or
         attorney at the expense of the Company and shall incur no liability of
         any kind by reason of such inquiry or investigation;

                  (viii) 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 in respect of any action
         taken, suffered or omitted by it hereunder in good faith and in
         reliance thereon; and

                  (ix) 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 any event
         which is in fact such a Default is received by the Trustee at the
         Corporate Trust Office of the Trustee, and such notice references the
         Notes and this Indenture;

                  (x) the Trustee shall not be liable for any action take,
         suffered, or omitted to be taken by it in good faith and reasonably
         believed by it to be authorized or within the discretion or rights or
         powers conferred upon it by this Indenture; and





                                       46

                  (xi) 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 each agent, custodian
         and other Person employed to act hereunder.

         SECTION 7.03.  Individual Rights of Trustee. The Trustee, in its
individual or any other capacity, may become the owner or pledgee of Notes and
may otherwise deal with the Company or its Affiliates with the same rights it
would have if it were not the Trustee. Any Agent may do the same with like
rights. However, the Trustee is subject to TIA Sections 310(b) and 311.

         SECTION 7.04.  Trustee's Disclaimer. The Trustee (i) makes no
representation as to the validity or adequacy of this Indenture or the Notes,
except that the Trustee represents that it is duly authorized to execute and
deliver this Indenture, authenticate the Notes and perform its obligations
hereunder, (ii) shall not be accountable for the Company's use or application of
the proceeds from the Notes and (iii) shall not be responsible for any statement
in the Notes other than its Certificate of authentication.

         SECTION 7.05.  Notice of Default. If any Default or any Event of
Default occurs and is continuing and if such Default or Event of Default is
actually known to a Responsible Officer of the Trustee, the Trustee shall mail
to each Holder in the manner and to the extent provided in TIA Section 313(c)
notice of the Default or Event of Default within 45 days after it occurs, unless
such Default or Event of Default has been cured; provided, however, that, except
in the case of a default in the payment of the principal of, Redemption Price,
or interest on any Note, the Trustee shall be protected in withholding such
notice if and so long as a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determine that the withholding of such
notice is in the interest of the Holders.

         SECTION 7.06.  Reports by Trustee to Holders. Within 60 days after
each May 15, beginning with May 15, 2004, the Trustee shall mail to each Holder
as provided in TIA Section 313(c) a brief report dated as of such May 15, if
required by TIA Section 313(a).

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

         SECTION 7.07.  Compensation and Indemnity. The Company shall pay to
the Trustee such compensation as shall be agreed upon in writing for its
services hereunder. The compensation of the Trustee shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by the Trustee without gross negligence or bad
faith on its part. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.

         The Company shall indemnify the Trustee for, and hold it harmless
against, any and all loss, damage, claim or liability or expense, including
taxes (other than taxes based on the income




                                       47

of the Trustee) incurred by it without gross negligence or bad faith on its part
in connection with the acceptance or administration of this Indenture and its
duties under this Indenture and the Notes, including the costs and expenses of
defending itself against any claim or liability and of complying with any
process served upon it or any of its Officers in connection with the exercise or
performance of any of its powers or duties under this Indenture and the Notes.
The Trustee shall notify the Company promptly of any claim of which a
Responsible Officer has received written notice for which it may seek indemnity.
Failure by the Trustee to so notify the Company shall not relieve the Company of
its obligations hereunder, unless the Company is materially prejudiced thereby.
The Company shall defend the claim and the Trustee shall cooperate in the
defense. Unless otherwise set forth herein, 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.

         To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee, in its capacity as Trustee, except money or property
held in trust to pay principal of, Redemption Price, and interest on particular
Notes.

         If the Trustee incurs expenses or renders services after the occurrence
of an Event of Default specified in clause (g) or (h) of Section 6.01, the
expenses and the compensation for the services will be intended to constitute
expenses of administration under Title 11 of the United States Bankruptcy Code
or any applicable federal or state law for the relief of debtors.

         The provisions of this Section 7.07 shall survive the termination of
this Indenture and resignation or removal of the Trustee.

         The Trustee shall comply with the provisions of TIA Section 313(b)(2)
to the extent applicable.

         SECTION 7.08. Replacement of Trustee. A resignation or removal of the
Trustee and appointment of a successor Trustee shall become effective only upon
the successor Trustee's acceptance of appointment as provided in this Section
7.08.

         The Trustee may resign at any time by so notifying the Company in
writing at least 30 days prior to the date of the proposed resignation. The
Holders of a majority in principal amount of the Outstanding Notes may remove
the Trustee by so notifying the Trustee in writing and may appoint a successor
Trustee with the consent of the Company. The Company may remove the Trustee if:
(i) the Trustee is no longer eligible under Section 7.10; (ii) the Trustee is
adjudged a bankrupt or an insolvent; (iii) a receiver or other public officer
takes charge of the Trustee or its property; or (iv) the Trustee becomes
incapable of acting.

         If the Trustee resigns or is removed, or if a vacancy exists in the
office of Trustee for any reason, the 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 Outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company. If
the successor Trustee does not deliver its written acceptance required by the
next




                                       48

succeeding paragraph of this Section 7.08 within 30 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or the Holders
of a majority in principal amount of the Outstanding Notes may petition, at the
expense of the Company, any court of competent jurisdiction for the appointment
of a successor Trustee.

         A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after the
delivery of such written acceptance, subject to the lien provided in Section
7.07, (i) the retiring Trustee shall upon payment of its charge hereunder
transfer all property held by it as Trustee to the successor Trustee, (ii) the
resignation or removal of the retiring Trustee shall become effective and (iii)
the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Holder. No successor Trustee shall accept its appointment
unless at the time of such acceptance such successor Trustee shall be qualified
and eligible under this Article.

         If the Trustee is no longer eligible under Section 7.10 or shall fail
to comply with TIA Section 310(b), any Holder who satisfies the requirements of
TIA Section 310(b) may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.

         The Company shall give notice of any resignation and any removal of the
Trustee and each appointment of a successor Trustee to all Holders. Each notice
shall include the name of the successor Trustee and the address of its Corporate
Trust Office.

         Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligation under Section 7.07 shall continue for the benefit
of the retiring Trustee.

         SECTION 7.09.  Successor Trustee by Merger, Etc. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation or national banking
association, the resulting, surviving or transferee corporation or national
banking association without any further act shall be the successor Trustee with
the same effect as if the successor Trustee had been named as the Trustee
herein, provided such corporation shall be otherwise qualified and eligible
under this Article.

         SECTION 7.10.  Eligibility. This Indenture shall always have a
Trustee who satisfies the requirements of TIA Section 310(a)(1). The Trustee
shall have a combined capital and surplus of at least $25 million as set forth
in its most recent published annual report of condition that is subject to
supervision or examination by federal or state authority. If at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 7.10, the Trustee shall resign immediately in the manner and with the
effect specified in this Article.

         SECTION 7.11.  Money Held in Trust. The Trustee shall not be liable
for interest on any money received by it except as the Trustee may agree in
writing with the Company. Money held in trust by the Trustee need not be
segregated from other funds except to the extent required by law and except for
money held in trust under Article Eight of this Indenture.





                                       49

                               ARTICLE EIGHT
                             DISCHARGE OF INDENTURE

         SECTION 8.01.  Termination of Company's Obligations. Except as
otherwise provided in this Section 8.01, the Company may terminate its
obligations under the Notes and this Indenture if:

                  (i) all Notes previously authenticated and delivered (other
         than destroyed, lost or stolen Notes that have been replaced or Notes
         that are paid pursuant to Section 4.01 or Notes for whose payment money
         or securities have theretofore been held in trust and thereafter repaid
         to the Company, as provided in Section 8.05) have been delivered to the
         Trustee for cancellation and the Company has paid all sums payable by
         it hereunder; or

                  (ii) (A) the Notes mature within one year or all of them are
         to be called for redemption within one year under arrangements
         satisfactory to the Trustee for giving the notice of redemption, (B)
         the Company irrevocably deposits in trust with the Trustee during such
         one-year period, under the terms of an irrevocable trust agreement in
         form and substance satisfactory to the Trustee, as trust funds solely
         for the benefit of the Holders for that purpose, money or U.S.
         Government Obligations sufficient (in the opinion of a nationally
         recognized firm of independent public accountants expressed in a
         written certification thereof delivered to the Trustee), without
         consideration of any reinvestment of any interest thereon, to pay
         principal, premium, if, any, and interest on the Notes to maturity or
         redemption, as the case may be, and to pay all other sums payable by it
         hereunder, (C) no Default or Event of Default with respect to the Notes
         shall have occurred and be continuing on the date of such deposit, (D)
         such deposit will not result in a breach or violation of, or constitute
         a default under, this Indenture or any other agreement or instrument to
         which the Company is a party or by which it is bound and (E) the
         Company has delivered to the Trustee an Officers' Certificate and an
         Opinion of Counsel, in each case stating that all conditions precedent
         provided for herein relating to the satisfaction and discharge of this
         Indenture have been complied with.

         With respect to the foregoing clause (i), the Company's obligations
under Section 7.07 shall survive. With respect to the foregoing clause (ii), the
Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.11, 4.01,
4.02, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the Notes are no
longer Outstanding. Thereafter, only the Company's obligations in Sections 7.07,
8.05 and 8.06 shall survive such satisfaction and discharge. After any such
irrevocable deposit, the Trustee upon request shall acknowledge in writing the
discharge of the Company's obligations under the Notes and this Indenture except
for those surviving obligations specified above.

     SECTION 8.02. Defeasance and Discharge of Indenture. The Company will be
deemed to have paid and will be discharged from any and all obligations in
respect of the Notes on the 123rd day after the date of the deposit referred to
in clause (A) of this Section 8.02, and the provisions of this Indenture will
no longer be in effect with respect to the Notes, and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the same
if:





                                       50

                  (A) with reference to this Section 8.02, the Company has
         irrevocably deposited or caused to be irrevocably deposited with the
         Trustee (or another trustee satisfying the requirements of Section
         7.10) and conveyed all right, title and interest to the Trustee for the
         benefit of the Holders, under the terms of an irrevocable trust
         agreement in form and substance satisfactory to the Trustee as trust
         funds in trust, specifically pledged to the Trustee for the benefit of
         the Holders as security for payment of the principal of, Redemption
         Price, and interest, if any, on the Notes, and dedicated solely to, the
         benefit of the Holders, in and to (1) money in an amount, (2) U.S.
         Government Obligations that, through the payment of interest,
         Redemption Price, and principal in respect thereof in accordance with
         their terms, will provide, not later than one day before the due date
         of any payment referred to in this clause (A), money in an amount or
         (3) a combination thereof in an amount sufficient, in the opinion of a
         nationally recognized firm of independent public accountants expressed
         in a written certification thereof delivered to the Trustee, to pay and
         discharge, without consideration of the reinvestment of such interest
         and after payment of all federal, state and local taxes or other
         charges and assessments in respect thereof payable by the Trustee, the
         principal of, Redemption Price, and accrued interest on the outstanding
         Notes on the Stated Maturity of such principal or interest; provided
         that the Trustee shall have been irrevocably instructed to apply such
         money or the proceeds of such U.S. Government Obligations to the
         payment of such principal, Redemption Price, and interest with respect
         to the Notes;

                  (B) the Company has delivered to the Trustee (1) either (x) an
         Opinion of Counsel to the effect that Holders will not recognize
         income, gain or loss for federal income tax purposes as a result of the
         Company's exercise of its option under this Section 8.02 and will be
         subject to federal income tax on the same amount and in the same manner
         and at the same times as would have been the case if such deposit,
         defeasance and discharge had not occurred which Opinion of Counsel
         shall be based upon (and accompanied by a copy of) a ruling of the
         Internal Revenue Service to the same effect unless there has been a
         change in applicable federal income tax law after the Effective Date
         such that a ruling is no longer required or (y) a ruling directed to
         the Trustee received from the Internal Revenue Service to the same
         effect as the aforementioned Opinion of Counsel and (2) an Opinion of
         Counsel to the effect that the creation of the defeasance trust does
         not violate the Investment Company Act of 1940 and that after the
         passage of 123 days following the deposit (except, with respect to any
         trust funds for the account of any Holder who may be deemed to be an
         "insider" for purposes of the United States Bankruptcy Code, after one
         year following the deposit), the trust funds will not be subject to the
         effect of Section 547 of the United States Bankruptcy Code or Section
         15 of the New York Debtor and Creditor Law in a case commenced by or
         against the Company under either such statute, and either (I) the trust
         funds will no longer remain the property of the Company (and therefore
         will not be subject to the effect of any applicable bankruptcy,
         insolvency, reorganization or similar laws affecting creditors' rights
         generally) or (II) if a court were to rule under any such law in any
         case or proceeding that the trust funds remained property of the
         Company, (a) assuming such trust funds remained in the possession of
         the Trustee prior to such court ruling to the extent not paid to the
         Holders, the Trustee will hold, for the benefit of the Holders, a valid
         and perfected security interest in such trust funds that is not
         avoidable in bankruptcy or otherwise except for the effect of Section




                                       51

         552(b) of the United States Bankruptcy Code on interest on the trust
         funds accruing after the commencement of a case under such statute and
         (b) the Holders will be entitled to receive adequate protection of
         their interests in such trust funds if such trust funds are used in
         such case or proceeding;

                  (C) immediately after giving effect to such deposit on a pro
         forma basis, no Default or Event of Default shall have occurred and be
         continuing on the date of such deposit or during the period ending on
         the 123rd day after such date of such deposit, and such deposit shall
         not result in a breach or violation of, or constitute a default under,
         this Indenture or any 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;

                  (D) if the Notes are then listed on a national securities
         exchange, the Company has delivered to the Trustee an Opinion of
         Counsel to the effect that the Notes will not be delisted as a result
         of such deposit, defeasance and discharge; and

                  (E) the Company has delivered to the Trustee an Officers'
         Certificate and an Opinion of Counsel, in each case stating that all
         conditions precedent provided for herein relating to the defeasance
         contemplated by this Section 8.02 have been complied with.

         Notwithstanding the foregoing, prior to the end of the 123-day (or one
year) period referred to in clause (B)(2) of this Section 8.02, none of the
Company's obligations under this Indenture shall be discharged. Subsequent to
the end of such 123-day (or one year) period with respect to this Section 8.02,
the Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.11, 4.01,
4.02, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the Notes are no
longer Outstanding. Thereafter, only the Company's obligations in Sections 7.07,
8.05 and 8.06 shall survive. If and when a ruling from the Internal Revenue
Service or an Opinion of Counsel referred to in clause (B)(1) of this Section
8.02 is able to be provided specifically without regard to, and not in reliance
upon, the continuance of the Company's obligations under Section 4.01, then the
Company's obligations under such Section 4.01 shall cease upon delivery to the
Trustee of such ruling or Opinion of Counsel and compliance with the other
conditions precedent provided for herein relating to the defeasance contemplated
by this Section 8.02.

         After any such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Notes and this Indenture except for those surviving obligations in the
immediately preceding paragraph.

         SECTION 8.03.  Defeasance of Certain Obligations. The Company may
omit to comply with any term, provision or condition set forth in clauses (iii)
and (iv) of Section 5.01 and Sections 4.03 through 4.11 and clause (c) of
Section 6.01 with respect to clauses (iii) and (iv) of Section 5.01, clause (d)
of Section 6.01 with respect to Sections 4.01, 4.02 and 4.12 through 4.19 and
clauses (e) and (f) of Section 6.01 shall be deemed not to be Events of Default,
in each case with respect to the Outstanding Notes if:

                  (i) with reference to this Section 8.03, the Company has
         irrevocably deposited or caused to be irrevocably deposited with the
         Trustee (or another trustee satisfying the requirements of Section
         7.10) and conveyed all right, title and interest to




                                       52

         the Trustee for the benefit of the Holders, under the terms of an
         irrevocable trust agreement in form and substance satisfactory to the
         Trustee as trust funds in trust, specifically pledged to the Trustee
         for the benefit of the Holders as security for payment of the principal
         of, Redemption Price, and interest, if any, on the Notes, and dedicated
         solely to, the benefit of the Holders, in and to (A) money in an
         amount, (B) U.S. Government Obligations that, through the payment of
         interest, Redemption Price, and principal in respect thereof in
         accordance with their terms, will provide, not later than one day
         before the due date of any payment referred to in this clause (i),
         money in an amount or (C) a combination thereof in an amount
         sufficient, in the opinion of a nationally recognized form of
         independent public accountants expressed in a written certification
         thereof delivered to the Trustee, to pay and discharge, without
         consideration of the reinvestment of such interest and after payment of
         all federal, state and local taxes or other charges and assessments in
         respect thereof payable by the Trustee, the principal of, Redemption
         Price, and interest on the Outstanding Notes on the Stated Maturity of
         such principal or interest; provided that the Trustee shall have been
         irrevocably instructed to apply such money or the proceeds of such U.S.
         Government Obligations to the payment of such principal, Redemption
         Price, and interest with respect to the Notes;

                  (ii) the Company has delivered to the Trustee an Opinion of
         Counsel to the effect that (A) the creation of the defeasance trust
         does not violate the Investment Company Act of 1940, (B) after the
         passage of 123 days following the deposit (except, with respect to any
         trust funds for the account of any Holder who may be deemed to be an
         "insider" for purposes of the United States Bankruptcy Code, after one
         year following the deposit), the trust funds will not be subject to the
         effect of Section 547 of the United States Bankruptcy Code or Section
         15 of the New York Debtor and Creditor Law in a case commenced by or
         against the Company under either such statute, and either (1) the trust
         funds will no longer remain the property of the Company (and therefore
         will not be subject to the effect of any applicable bankruptcy,
         insolvency, reorganization or similar laws affecting creditors' rights
         generally) or (2) if a court were to rule under any such law in any
         case or proceeding that the trust funds remained property of the
         Company, (x) assuming such trust funds remained in the possession of
         the Trustee prior to such court ruling to the extent not paid to the
         Holders, the Trustee will hold, for the benefit of the Holders, a valid
         and perfected security interest in such trust funds that is not
         avoidable in bankruptcy or otherwise (except for the effect of Section
         552(b) of the United States Bankruptcy Code on interest on the trust
         funds accruing after the commencement of a case under such statute) and
         (y) the Holders will be entitled to receive adequate protection of
         their interests in such trust funds if such trust funds are used in
         such case or proceeding, (C) the Holders will not recognize income,
         gain or loss for federal income tax purposes as a result of such
         deposit and defeasance of certain covenants and Events of Default and
         will be subject to federal income tax on the same amount and in the
         same manner and at the same times as would have been the case if such
         deposit and defeasance had not occurred and (D) the Trustee, for the
         benefit of the Holders, has a valid first-priority security interest in
         the trust funds;

                  (iii) immediately after giving effect to such deposit on a pro
         forma basis, no Default or Event of Default shall have occurred and be
         continuing on the date of such deposit or during the period ending on
         the 123rd day after such date of such deposit, and




                                       53

         such deposit shall not result in a breach or violation of, or
         constitute a default under, this Indenture or any 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;

                  (iv) if the Notes are then listed on a national securities
         exchange, the Company has delivered to the Trustee an Opinion of
         Counsel to the effect that the Notes will not be delisted as a result
         of such deposit, defeasance and discharge; and (v) the Company has
         delivered to the Trustee an Officers' Certificate and an Opinion of
         Counsel, in each case stating that all conditions precedent provided
         for herein relating to the defeasance contemplated by this Section 8.03
         have been complied with.

         SECTION 8.04.  Application of Trust Money; Miscellaneous. Subject to
Section 8.06, the Trustee or Paying Agent shall hold in trust money or U.S.
Government Obligations deposited with it pursuant to Section 8.01, 8.02 or 8.03,
as the case may be, and shall apply the deposited money and the money from U.S.
Government Obligations in accordance with the Notes and this Indenture to the
payment of principal of, Redemption Price, and interest on the Notes; but such
money need not be segregated from other funds except to the extent required by
law.

         The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 8.01, 8.02 or 8.03 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of Outstanding Notes and which shall be
deducted from the amount to be received by the Holders of Outstanding Notes.

         SECTION 8.05.  Repayment to Company. Subject to Sections 7.07, 8.01,
8.02 and 8.03, the Trustee and the Paying Agent shall promptly pay to the
Company upon request set forth in an Officers' Certificate any excess money held
by them at any time and thereupon shall be relieved from all liability with
respect to such money. The Trustee and the Paying Agent shall pay to the Company
upon written request any money held by them for the payment of principal,
Redemption Price, or interest that remains unclaimed for two years; provided
that the Trustee or Paying Agent before being required to make any payment may
cause to be published at the expense of the Company once in a newspaper of
general circulation in The City of New York and, or may, at the expense of the
Company, mail to each Holder entitled to such money at such Holder's address (as
set forth in the Security Register) notice that such money remains unclaimed and
that after a date specified therein (which shall be at least 30 days from the
date of such publication or mailing) any unclaimed balance of such money then
remaining will be repaid to the Company. After payment to the Company, Holders
entitled to such money must look to the Company for payment as general creditors
unless an applicable law designates another Person, and all liability of the
Trustee and such Paying Agent with respect to such money shall cease.

         SECTION 8.06.  Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with
Section 8.01, 8.02 or 8.03, as the case may be, by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.01, 8.02 or
8.03, as the case may be, until




                                       54

such time as the Trustee or Paying Agent is permitted to apply all such money or
U.S. Government Obligations in accordance with Section 8.01, 8.02 or 8.03, as
the case may be; provided that, if the Company has made any payment of principal
of, Redemption Price, or interest on any Notes because of the reinstatement of
its obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or U.S. Government Obligations
held by the Trustee or Paying Agent.

                               ARTICLE NINE
                       AMENDMENTS, SUPPLEMENTS AND WAIVERS

         SECTION 9.01.  Without Consent of Holders. The Company, when
authorized by a resolution of its Board of Directors (as evidenced by a Board
Resolution delivered to the Trustee), and the Trustee may amend or supplement
this Indenture or the Notes without notice to or the consent of any Holder:

                  (1) to cure any ambiguity, defect or inconsistency in this
         Indenture; provided that such amendments or supplements shall not, in
         the good faith opinion of the Board of Directors as evidenced by a
         Board Resolution, adversely affect the interests of the Holders in any
         material respect;

                  (2) to comply with Article Five;

                  (3) to comply with any requirements of the Commission in
         connection with the qualification of this Indenture under the TIA;

                  (4) to evidence and provide for the acceptance of appointment
         hereunder by a successor Trustee; or

                  (5) to make any change that, in the good faith opinion of the
         Board of Directors as evidenced by a Board Resolution, does not
         materially and adversely affect the rights of any Holder.

         SECTION 9.02.  With Consent of Holders. (a) Subject to Sections 6.04
and 6.07 and without prior notice to the Holders, the Company, when authorized
by its Board of Directors (as evidenced by a Board Resolution delivered to the
Trustee), and the Trustee may amend this Indenture and the Notes with the
written consent of the Holders of a majority in principal amount of the Notes
then outstanding, and the Holders of a majority in principal amount of the Notes
then Outstanding by written notice to the Trustee may waive future compliance by
the Company with any provision of this Indenture and the Notes.

         (b) Notwithstanding the provisions of this Section 9.02, without the
consent of each Holder affected, an amendment or waiver, including a waiver
pursuant to Section 6.04, may not:

                  (i) reduce the principal amount of or change the Stated
         Maturity or any installment of principal of any Note;





                                       55

                  (ii) reduce the rate of or change the Stated Maturity of any
         interest payment on any Note;

                  (iii) change any place or currency of payment of principal of,
         Redemption Price, or interest on, any Note;

                  (iv) impair the right to institute suit for the enforcement of
         any payment on or after the Stated Maturity (or, in the case of
         redemption, on or after the Redemption Date) on any Note;

                  (v) reduce the percentage or principal amount of Outstanding
         Notes the consent of whose Holders is necessary to modify or amend this
         Indenture or to waive compliance with certain provisions of or certain
         Defaults under this Indenture;

                  (vi) waive a default in the payment of principal of,
         Redemption Price, or interest on, any Note; or

                  (vii) modify any of the provisions of this Section 9.02,
         except to increase any such percentage or to provide that certain other
         provisions of this Indenture cannot be modified or waived without the
         consent of the Holder of each Outstanding Note affected thereby.

         ( c) It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.

         (d) After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. The Company will
mail supplemental indentures to Holders upon request. 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 supplemental indenture or waiver.

         SECTION 9.03.  Revocation and Effect of Consent. Until an amendment
or waiver becomes effective, a consent to it by a Holder is a continuing consent
by the Holder and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the Note of the consenting Holder, even if notation
of the consent is not made on any Note. However, any such Holder or subsequent
Holder may revoke the consent as to its Note or portion of its Note. Such
revocation shall be effective only if the Trustee receives the notice of
revocation before the date the amendment, supplement or waiver becomes
effective. An amendment, supplement or waiver shall become effective on receipt
by the Trustee of written consents from the Holders of the requisite percentage
in principal amount of the Outstanding Notes.

         The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then, notwithstanding the last
two sentences of the immediately preceding paragraph, those persons who were
Holders at such record date (or their duly designated proxies) and only those
persons shall be entitled to consent to such amendment, supplement or waiver or
to revoke any consent previously given, whether or not such persons continue to
be Holders after




                                       56

such record date. No such consent shall be valid or effective for more than 90
days after such record date.

         After an amendment, supplement or waiver becomes effective, it shall
bind every Holder unless it is of the type described in the second paragraph of
Section 9.02. In case of an amendment or waiver of the type described in the
second paragraph of Section 9.02, the amendment or waiver shall bind each Holder
who has consented to it and every subsequent Holder of a Note that evidences the
same indebtedness as the Note of the consenting Holder.

         SECTION 9.04.  Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Trustee may require the
Holder to deliver such Note to the Trustee. At the Company's expense, the
Trustee may place an appropriate notation on the Note about the changed terms
and return it to the Holder and the Trustee may place an appropriate notation on
any Note thereafter authenticated. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms. 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 9.05.  Trustee to Sign Amendments, Etc. The Trustee shall
provided with, and shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture and that it will be valid and binding upon the Company. Subject to the
preceding sentence, the Trustee shall sign such amendment, supplement or waiver
if the same does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. The Trustee may, but shall not be obligated to,
execute any such amendment, supplement or waiver that affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.

         SECTION 9.06.  Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article Nine shall conform to
the requirements of the TIA as then in effect.

                                  ARTICLE TEN
                                  MISCELLANEOUS

         SECTION 10.01. Trust Indenture Act of 1939. This Indenture shall be
subject to the provisions of the TIA that are required to be a part of this
Indenture and shall, to the extent applicable, be governed by such provisions.

         SECTION 10.02. Notices. Any notice or communication shall be
sufficiently given if in writing and delivered in person, mailed by first-class
mail or sent by telecopier transmission addressed as follows:



                                       57

         if to the Company:

                  Advanced Lighting Technologies, Inc.
                  32000 Aurora Road
                  Solon, OH 44139
                  Telecopier No.:  (440) 542-4325
                  Attention: Chief Financial Officer

         if to the Trustee:


                  [--------------------]

         The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.

         Any notice or communication mailed to a Holder shall be mailed to it at
its address as it appears on the Security Register by first-class mail and shall
be sufficiently given to him if so mailed within the time prescribed. Any notice
or communication shall also be so mailed to any Person described in TIA Section
313(c), to the extent required by the TIA. Copies of any such communication or
notice to a Holder shall also be mailed to the Trustee and each Agent at the
same time.

         Failure to transmit a notice or communication to a Holder as provided
herein or any defect in any such notice or communication shall not affect its
sufficiency with respect to other Holders. Except for a notice to the Trustee,
which is deemed given only when received, and except as otherwise provided in
this Indenture, if a notice or communication is mailed in the manner provided in
this Section 10.02, it is duly given, whether or not the addressee receives it.

         Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.

         In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.

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

         SECTION 10.03.  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 stating that, in the opinion of
         the signers, all conditions precedent, if any, provided for in this
         Indenture relating to the proposed action have been complied with; and





                                       58

                  (ii) an Opinion of Counsel stating that, in the opinion of
         such Counsel, all such conditions precedent have been complied with.

         SECTION 10.04.  Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:

(i)      a statement that each person signing such certificate or opinion has
         read such covenant or condition and the definitions herein relating
         thereto;

(ii)     a brief statement as to the nature and scope of the examination or
         investigation upon which the statement or opinion contained in such
         certificate or opinion is based;

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

(iv)     a statement as to whether or not, in the opinion of each such person,
         such condition or covenant has been complied with; provided, however,
         that, with respect to matters of fact, an Opinion of Counsel may rely
         on an Officers' Certificate or certificates of public officials.

         SECTION 10.05. Rules by Trustee, Paying Agent or Registrar. The Trustee
may make reasonable rules for action by or at a meeting of Holders. The Paying
Agent or Registrar may make reasonable rules for its functions.

         SECTION 10.06. Payment Date Other Than a Business Day. If an Interest
Payment Date, Redemption Date, Payment Date, Stated Maturity or date of Maturity
of any Note shall not be a Business Day, then payment of principal of,
Redemption Price, or interest on such Note, as the case may be, need not be made
on such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on such Interest Payment Date, Redemption Date,
Payment Date, Stated Maturity or date of Maturity of such Note; provided that no
interest shall accrue for the period from and after such Interest Payment Date,
Redemption Date, Payment Date, Stated Maturity or date of Maturity, as the case
may be.

         SECTION 10.07. Governing Law. This Indenture and the Notes shall be
governed by the laws of the State of New York excluding (to the greatest extent
permissible by law) any rule of law that would cause the application of the laws
of any jurisdiction other than the State of New York.

         SECTION 10.08. No Adverse Interpretation of Other Agreements. This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or any Subsidiary of the Company. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.

         SECTION 10.09. No Recourse Against Others. No recourse for the payment
of the principal of, Redemption Price, or interest on any of the Notes, or for
any claim based thereon or




                                       59

otherwise in respect thereof, and no recourse under or upon any obligation,
covenant or agreement of the Company contained in this Indenture or in any of
the Notes, or because of the creation of any Indebtedness represented thereby,
shall be had against any incorporator or against any past, present or future
partner, stockholder, other equityholder, officer, director, employee or
controlling person, as such, of the Company or of any successor Person, either
directly or through the Company or any successor Person, whether by virtue of
any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the Notes.

         SECTION 10.10. 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 successor.

         SECTION 10.11. Duplicate Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.

         SECTION 10.12. Separability. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not ha any way be affected
or impaired thereby.

         SECTION 10.13. Table of Contents, Headings, Etc. The Table of Contents,
Cross-Reference Table and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof and shall in no way modify, or restrict any of the
terms and provisions hereof.







                                   SIGNATURES


         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.

                                 ADVANCED LIGHTING TECHNOLOGIES, INC.



                                 By:____________________________________________
                                    Name: Wayne R. Hellman
                                    Title: President, Chief Executive Office
                                    and Chairman of the Board of
                                               Directors

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


                                    By:_________________________________________
                                       Name:
                                       Title:





                                                                       EXHIBIT A



                                 [FACE OF NOTE]

                      ADVANCED LIGHTING TECHNOLOGIES, INC.

                            __% Senior Notes due 2010

                                       [CUSIP] [CINS] [ISIN] [_________________]

No. __________                                                $_________________


         ADVANCED LIGHTING TECHNOLOGIES, INC., an Ohio corporation (the
"Company", which term includes any successor under the Indenture hereinafter
referred to), for value received, promises to pay to _____________, or its
registered assigns, the principal sum of __________________ ($___________) on
September 15, 2010.

         Interest Payment Dates: March 15 and September 15, commencing [_______]
15, 2004.

         Regular Record Dates: March 1 and September 1.

         Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officers.

                                 ADVANCED LIGHTING TECHNOLOGIES, INC.



                                 By:____________________________________________
                                    Name:
                                    Title:



                                 By:____________________________________________
                                    Name:
                                    Title:






                    (Trustee's Certificate of Authentication)

This is one of the __% Senior Notes due 2010 described in the within-mentioned
Indenture.




Date:  ________, 2003               [__________________]
                                                as Trustee




                                      By:____________________________________
                                         Authorized Signatory






                                       A-3

                             [REVERSE SIDE OF NOTE]

                         ADVANCED LIGHTING TECHNOLOGIES, INC.

                            __% Senior Note due 2010

1.      Principal and Interest.

         The Company will pay the principal of this Note on September 15, 2010.

         The Company promises to pay interest on the principal amount of this
Note on each Interest Payment Date, as set forth below, at the rate per annum
shown above.

         Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from ___________, 2003.
Interest will be computed on the basis of a 360-day year of twelve 30-day months
and, in the case of an incomplete month, the number of days elapsed based on a
30-day month.

         The Company shall pay interest on overdue principal and Redemption
Price, to the extent lawful, at a rate per annum that is 2% in excess of the
rate otherwise payable.

2. Method of Payment.

         The Company will pay interest (except defaulted interest) on the
principal amount of this Note as provided above on each March 15 and September
15, commencing [_________] 15, 2004 to the persons who are Holders (as reflected
in the Security Register at the close of business on the March 1 or September 1
in each case whether or not a Business Day, immediately preceding the related
Interest Payment Date), in each case, even if the Note is canceled on
registration of transfer or registration of exchange after such record date;
provided that, with respect to the payment of principal, the Company will make
payment to the Holder that surrenders this Note to a Paying Agent on or after
the Maturity hereof.

         The Company will pay principal, Redemption Price, and as provided
above, interest in money of the United States that at the time of payment is
legal tender for payment of public and private debts. However, the Company may
pay principal, Redemption Price, and interest by its check payable in such
money. It may mail an interest check to a Holder's registered address (as
reflected in the Security Register). If a payment date is a date other than a
Business Day at a place of payment, payment may be made at that place on the
next succeeding day that is a Business Day and no interest shall accrue for the
intervening period.

3. Paying Agent and Registrar.

         Initially, the Trustee will act as authenticating agent, Paying Agent
and Registrar. The Company may change any authenticating agent, Paying Agent or
Registrar without notice. The Company, any Subsidiary or any Affiliate of any of
them may act as Paying Agent, Registrar or co-Registrar.



                                       A-4

4.       Indenture Limitations.

         The Company issued the Notes under an Indenture dated as of
_____________, 2003 (the "Indenture"), between the Company
and___________________, trustee (the "Trustee"). Capitalized terms herein are
used as defined in the Indenture unless otherwise indicated. The terms of the
Notes include those stated in the Indenture and those made part of the Indenture
by reference to the Trust Indenture Act. The Notes are subject to all such
terms, and Holders are referred to the Indenture and the Trust Indenture Act for
a statement of all such terms. To the extent permitted by applicable law, in the
event of any inconsistency between the terms of this Note and the terms of the
Indenture, the terms of the Indenture shall control.

         The Notes are general unsecured obligations of the Company.

         The Company may, subject to Article Four of the Indenture and
applicable law, issue additional Notes under the Indenture.

5.       Optional Redemption.

         The Notes are redeemable, at the Company's option, in whole or in part,
at any time or from time to time, on or after September 15, 2004 and prior to
Maturity, upon not less than 30 nor more than 60 days' prior notice mailed by
first class mail to each Holder's last address, as it appears in the Security
Register, at the following Redemption Prices (expressed in percentages of
principal amount), plus accrued and unpaid interest, if any, to the Redemption
Date (subject to the right of Holders of record on the relevant Regular Record
Date that is prior to the Redemption Date to receive interest due on an Interest
Payment Date), if redeemed during the 12-month period commencing September 15 of
the years set forth below:

                                                    Redemption
               Year                                    Price
               ----                                 ----------
               2004.............................     106.000%
               2005.............................     104.000
               2006.............................     102.667
               2007.............................     101.333
               2008 and thereafter                   100.000

         Notes in original denominations larger than $1,000 may be redeemed in
part. On and after the Redemption Date, interest ceases to accrue on Notes or
portions of Notes called for redemption, unless the Company defaults in the
payment of the Redemption Price.




                                    A-5


6.       Repurchase upon Change of Control.

         Upon the occurrence of any Change of Control, each Holder shall have
the right to require the repurchase of its Notes by the Company in cash pursuant
to the offer described in the Indenture at a purchase price equal to 101% of the
principal amount thereof plus accrued and unpaid interest, if any, to the date
of purchase (the "Payment Date").

         A notice of such Change of Control will be mailed within 30 days, after
any Change of Control occurs to each Holder at its last address as it appears in
the Security Register. Notes in original denominations larger than $1,000 may be
sold to the Company in part. On and after the Payment Date, interest ceases to
accrue on Notes or portions of Notes surrendered for purchase by the Company,
unless the Company defaults in the payment of the purchase price.

7. Denominations: Transfer; Exchange.

         The Notes are in registered form without coupons in denominations of
$1,000 of principal amount and multiples of $1,000 in excess thereof. A Holder
may register the transfer or exchange of Notes in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
or exchange of any Notes selected for redemption. Also, it need not register the
transfer or exchange of any Notes for a period of 15 days before the day of
mailing of a notice of redemption of Notes selected for redemption.

8.      Persons Deemed Owners.

        A Holder shall be treated as the owner of a Note for all purposes.

9. Unclaimed Money.

         If money for the payment of principal, Redemption Price, or interest
remains unclaimed for two years, the Trustee and the Paying Agent will pay the
money back to the Company at its written request. After that, Holders entitled
to the money must look to the Company for payment, unless an abandoned property
law designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.

10. Discharge Prior to Maturity.

         If the Company deposits with the Trustee money or U.S. Government
Obligations sufficient to pay the then outstanding principal of, Redemption
Price, and accrued interest on the Notes (a) to Maturity, the Company will be
discharged from the Indenture and the Notes, except in certain circumstances for
certain provisions thereof, and (b) to the Stated Maturity, the Company will be
discharged from certain covenants set forth in the Indenture.






                                    A-6


11. Amendment; Supplement; Waiver.

         Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the Notes then outstanding, and any existing default or
compliance with any provision may be waived with the consent of the Holders of
at least a majority in principal amount of the Notes then Outstanding. Without
notice to or the consent of any Holder, the parties thereto may amend or
supplement the Indenture or the Notes to, among other things, cure any
ambiguity, defect or inconsistency and make any change that does not materially
and adversely affect the rights of any Holder.

12.     Restrictive Covenants.


        The Indenture imposes certain limitations on the ability of the Company
and its Restricted Subsidiaries, among other things, to Incur additional
Indebtedness, make Restricted Payments, suffer to exist restrictions on the
ability of Restricted Subsidiaries to make certain payments to the Company,
issue Capital Stock of Restricted Subsidiaries, Guarantee Indebtedness of the
Company, engage in transactions with Affiliates, suffer to exist or incur Liens,
enter into sale-leaseback transactions, use the proceeds from Asset Sales, or
merge, consolidate or transfer substantially all of its assets. Within 90 days
after the end of each fiscal quarter (120 days after the end of the last fiscal
quarter of each year), the Company shall deliver to the Trustee an Officers'
Certificate stating whether or not the signers thereof know of any Default or
Event of Default under such restrictive covenants.


13.     Successor Persons.


         When a successor person or other entity assumes all the obligations of
its predecessor under the Notes and the Indenture, the predecessor person will
be released from those obligations.


14. Defaults and Remedies.

         Any of the following events constitutes an "Event of Default" under the
Indenture: (a) default in the payment of principal of (or Redemption Price, on)
any Note when the same becomes due and payable at maturity, upon acceleration,
redemption or otherwise; (b) default in the payment of interest on any Note when
the same becomes due and payable, and such default continues for a period of 30
days; (c) default in the performance or breach of Article Five of the Indenture
or the failure to make or consummate an Offer to Purchase in accordance with
Section 4.11 or Section 4.12 of the Indenture; (d) default in the performance of
or breach of any covenant or agreement of the Company in the Indenture or under
the Notes (other than a default specified in clause (a), (b) or (c) above), and
such default or breach continues for a period of 30 consecutive days after
written notice by the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then Outstanding: (e) there occurs with respect to
any issue or issues of Indebtedness of the Company or any Significant Subsidiary
having an outstanding principal amount of $10 million or more in the aggregate
for all such issues of all such Persons, whether such Indebtedness exists on the
Effective Date or shall hereafter be created, (I) an event





                                    A-7

of default that has caused the holder thereof to declare such Indebtedness to be
due and payable prior to its Stated Maturity and such Indebtedness has not been
discharged in full or such acceleration has not been rescinded or annulled
within 30 days of such acceleration and/or (II) the failure to make a principal
payment at the final (but not any interim) fixed maturity and such defaulted
payment shall not have been made, waived or extended within 30 days of such
payment default; (f) any final judgment or order (not covered by insurance) for
the payment of money in excess of $10 million in the aggregate for all such
final judgments or orders against all such Persons (treating any deductibles,
self-insurance or retention as not so covered) shall be rendered against the
Company or any Significant Subsidiary and shall not be paid or discharged, and
there shall be any period of 30 consecutive days following entry of the final
judgment or order that causes the aggregate amount for all such final judgments
or orders outstanding and not paid or discharged against all such Persons to
exceed $10 million during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; (g) a
court having jurisdiction in the premises enters a decree or order for (A)
relief in respect of the Company or any Significant Subsidiary in an involuntary
case under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, (B) appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (C) the winding up or
liquidation of the affairs of the Company or any Significant Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a period
of 60 consecutive days; or (h) the Company or any Significant Subsidiary (A)
commences a voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (B) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (C) effects any general
assignment for the benefit of creditors.

         If an Event of Default, as defined in the Indenture, occurs and is
continuing, the Trustee may, and at the direction of the Holders of at least 25%
in aggregate principal amount of the Notes then Outstanding shall, declare all
the Notes to be due and payable. If a bankruptcy or insolvency default with
respect to the Company occurs and is continuing, the Notes automatically become
due and payable. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may require indemnity satisfactory to it
before it enforces the Indenture or the Notes. Subject to certain limitations,
Holders of at least a majority in principal amount of the Notes then Outstanding
may direct the Trustee in its exercise of any trust or power.

15. Trustee Dealings with the Company.

         The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from and perform services for the
Company or its Affiliates and may otherwise deal with the Company or its
Affiliates as if it were not the Trustee.






                                    A-8


16. No Recourse Against Others.

         No incorporator or any past, present or future partner, stockholder,
other equityholder, officer, director, employee or controlling person, as such,
of the Company or of any successor Person shall have any liability for any
obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.

17. Authentication.

         This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.

18. Abbreviations.

         Customary abbreviations may be used in the name of a Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors
Act).

         The Company will furnish a copy of the Indenture to any Holder upon
written request and without charge. Requests may be made to Advanced Lighting
Technologies, Inc.,32000 Aurora Road, Solon, Ohio 44139; Attention: Chief
Financial Officer.


19. Governing Law.


         The Indenture and this Note shall be governed by the laws of the State
of New York excluding (to the greatest extent permissible by law) any rule of
law that would cause the application of the laws of any jurisdiction other than
the State of New York.




                                       A-9

                            [FORM OF TRANSFER NOTICE]

         FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto

Insert Taxpayer Identification No.

- ---------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee

- ---------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing -------------------------------------- attorney to transfer said Note
on the books of the Company with full power of substitution in the premises.


Date:--------------------       ----------------------------------------------
                                NOTICE: The signature to this assignment
                                must correspond with the name as written
                                upon the face of the within-mentioned
                                instrument in every particular, without
                                alteration or any change whatsoever.






                                      A-10


                       OPTION OF HOLDER TO ELECT PURCHASE

         If you wish to have this Note purchased by the Company pursuant to
Section 4.11 or 4.12 of the Indenture, check the Box: [ ]


         If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.11 or Section 4.12 of the Indenture, state the amount:
$--------------------------.


Date: _______________

Your Signature:-----------------------------------------------------------------
              (Sign exactly as your name appears on the other side of this Note)

                           Signature Guarantee: ________________________________





                                   EXHIBIT E
              to First Amended Chapter 11 Plan of Reorganization
              --------------------------------------------------

                    Saratoga Management Services Agreement1
                    --------------------------------------





- ---------
     This exhibit was designated as Exhibit H to the Plan filed on August 15,
2003.






                              MANAGEMENT SERVICES AGREEMENT


     This MANAGEMENT SERVICES AGREEMENT (the "Agreement") is made and entered
into as of _______, 2003 [Effective Date], among ADVANCED LIGHTING TECHNOLOGIES,
INC., an Ohio corporation (the "Company"), and SARATOGA MANAGEMENT COMPANY, LLC,
a Delaware limited liability company ("Saratoga").

     The Company desires that Saratoga provide certain ongoing management and
advisory services to the Company, and Saratoga is willing to provide such
services subject to the terms and conditions contained herein.

     NOW, THEREFORE, for good and valuable consideration, the receipt of which
is hereby acknowledged, the parties agree as follows:

     Section 1. Services. During the term of this Agreement, Saratoga shall
provide such advisory and management services to the Company as the Board of
Directors of the Company shall reasonably request and Saratoga shall agree to
provide from time to time. The Company agrees that Saratoga shall have the
right, but not the obligation, to act as sole advisor to the Company with
respect to significant business transactions. Such services shall be performed
at Saratoga's offices or at such other locations as Saratoga shall reasonably
determine.

     Section 2. Compensation. In consideration of the services to be provided in
accordance with Section 1, the Company agrees to pay, to Saratoga:

     (i) an advisory fee of 1% of the enterprise value of the Company as of the
     date hereof, which fee shall be fully earned as of the date hereof and
     shall be paid from the proceeds of Non-Core Assets (to be defined) which is
     expected to take place within the first year of confirmation of the Plan
     (defined below); and

     (ii) a quarterly management fee, payable in advance (on or before March 31,
     June 30, September 30, and December 31 of each year that this Agreement is
     in effect) equal to $150,000 ($600,000 in the aggregate) (the "Management
     Fee") plus 0.5% of the aggregate amount of cash (and the fair market value
     of other property as reasonably determined by the Company's Board of
     Directors) (the "Equity Fee") received by the Company after the Effective
     Date in connection with issuances of the Company's equity securities (with
     a prorated Equity Fee amount to be paid with respect to the period in which
     such cash or property is received, payable on the date such cash or other
     property is



     received) to be adjusted annually upwards on each anniversary date for any
     increase in the rate of inflation as indicated by the Consumer Price Index
     from the prior year, as the case may be; provided, however that upon a
     default relating to the New Notes under the New Indenture and during the
     continuation of such default, the Management Fee and Equity Fee otherwise
     required by this Section 2(ii) shall accrue but not be payable until such
     time as the default is cured; and

     (iii) advisory and/or structuring fees in connection with significant
     business transactions (including, without limitation, acquisitions,
     investments and financings) ("Structuring Fees") in amounts comparable for
     similarly situated companies. The Structuring Fees shall be negotiated in
     good faith by the Company and Saratoga and payable on such date as the
     parties determine under a separate agreement.

     In the event that the Company fails to make a payment under this Section 2
(with the exception of non-payment in accordance with the proviso in Section
2(ii) hereof), or a dispute regarding payment arises, Saratoga reserves the
right to not perform under this Agreement until such time as the Company either
pays Saratoga or the parties hereto resolve their dispute. Both parties agree to
promptly negotiate any such disputes in good faith.

     Notwithstanding the foregoing, the Company shall not be required to pay to
Saratoga any such payment that is otherwise prohibited by any credit agreement
or applicable law. In such cases, the due dates shall be deferred until payment
of cash is permitted and all amounts owed shall accrue interest at the same rate
paid on the Company's senior debt.

     Section 3. Reimbursement. Saratoga and its affiliates shall be entitled to
reimbursement of all reasonable out-of-pocket expenses (including travel,
consultant and legal expenses) incurred in connection with or relating to the
performance of this Agreement (other than salary expenses and associated
overhead charges).

     Section 4. Indemnity; No Liability. In consideration of the execution and
delivery of this Agreement by Saratoga, the Company hereby agrees to indemnify,
defend, exonerate and hold each of Saratoga and its affiliates, and each of
their respective partners, members, shareholders, affiliates, directors,
officers, fiduciaries, employees and agents and each of the partners,
shareholders, affiliates, directors, officers, fiduciaries, employees and agents
of each of the foregoing (collectively, the "Indemnitees") free and harmless
from and against any and all claims, demands, liens, claims of lien, actions,
causes of action, suits,

                                      -2-


losses, liabilities and damages, and expenses in connection therewith, including
without limitation reasonable attorneys' fees and disbursements (collectively,
the "Indemnified Liabilities"), incurred by the Indemnitees or any of them as a
result of, or arising out of, or relating to the execution, delivery,
performance, enforcement or existence of this Agreement or the transactions
contemplated hereby or thereby except for any such Indemnified Liabilities
arising solely on account of such Indemnitee's gross negligence or willful
misconduct, and if and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Company hereby agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law. None of the Indemnitees
shall be liable to the Company or any of their affiliates for any act or
omission suffered or taken by such Indemnitee that is not finally judicially
determined to constitute gross negligence or willful misconduct.

     Section 5. Governing Law; Submission to Jurisdiction. This Agreement shall
be governed by, and construed in accordance with, the laws of the State of New
York, without regard to conflicts of law principles.

     Section 6. Termination. This Agreement may be terminated by Saratoga at any
time by written notice to the Company pursuant to Section 7 below. In addition,
this Agreement will terminate automatically as of the earlier of (i) the tenth
anniversary of this Agreement and (ii) the end of the fiscal year in which the
fully diluted ownership interest of Saratoga and its affiliates in the
outstanding common stock of the Company falls below 5%, unless expressly
extended in writing. The provisions of Section 4 shall survive any termination
of this Agreement.

     Section 7. Notices. All notices and demands which any party is required or
desires to give to any other shall be given in writing by personal delivery or
by express courier service or certified mail, return receipt requested, to the
addresses below for the respective party. However, if either party gives notice
of a change of name or address, notices to that party shall thereafter be given
as demanded in that notice. All notices and demands given by personal delivery
or by express courier service shall be effective upon receipt by the party to
whom notice or a demand is being given. All notices given by mail shall be
effective on the third business day after mailing.

     For convenience, the addresses, telephone and facsimile numbers of the
parties and their respective counsel hereto are:

The Company:
- -----------

Advanced Lighting Technologies, Inc.
32000 Aurora Road

                                      -3-


Solon, Ohio, 44139
Attn:  Wayne R. Hellman
Telephone:  _____________
Facsimile: (440) 519-0503

With a copy to:
- --------------

Jenner & Block, LLC
One IBM Plaza
Chicago, Illinois 60611
Attn:  Jeff Marwil
Telephone:  (312) 923-2619
Facsimile: (312) 527-0484

Saratoga:
- --------

Saratoga Management Company, LLC
535 Madison Avenue - 4th Floor
New York, New York 10017
Attn:  Christian Oberbeck
Telephone:  (212) 906-7350
Facsimile: (212) 750-3343

With a copy to:
- --------------

Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Attn:  Stephen H. Case
Telephone:  (212) 450-4064
Facsimile:  (212) 450-3064

     Section 8. Relationship of Parties. Each party is an independent contractor
and not an agent or partner of, or joint venturer with, the other party for any
purpose, and neither party by virtue of this Agreement shall have any right,
power, or authority to act or create any obligation, express or implied, on
behalf of the other party except as expressly provided herein. In the event that
an agency relationship is created or implied, any such agency will be a limited
agency wherein the duties of Saratoga are specifically limited to the subject
matter hereof and will not create or result in the imposition on Saratoga of any
other duties of any kind or nature, including without limitation any duties
which may otherwise arise by operation of law. This Agreement is not intended to
and does not create any rights, claims, remedies or

                                      -4-


benefits inuring to any person (including any customer, or any creditor or
employee of Saratoga or the Company) that is not a party hereto nor create or
establish any third party beneficiary hereto.

     Section 9. Assignment. Rights under this Agreement shall not be assignable
and duties under this Agreement shall not be delegable by either party except by
the Company to any subsidiary or affiliate of Saratoga or the Company or to any
successor in interest to the Company's or Saratoga's business.

     Section 10. Entire Agreement. This Agreement contains the entire agreement
of the parties hereto and supersedes all prior understandings and agreements,
whether oral or in writing, regarding the subject matter of this Agreement.

     Section 11. Severability. If any term, covenant, condition or provision of
this Agreement, or their application to any person or circumstance, shall to any
extent be held by a court of competent jurisdiction to be invalid, void or
unenforceable, the parties shall renegotiate the unenforceable or invalid terms
so as to effect the intent of this Agreement, and the remainder of the
provisions of this Agreement, or their application to any person or
circumstance, shall remain in full force and effect.

     Section 12. Waiver of Covenants. Waiver by one of the parties hereto of any
covenant or condition under this Agreement shall not invalidate this Agreement
nor shall it be considered a waiver of any other covenant or condition under
this Agreement.

     Section 13. Further Acts. Each party hereto agrees to perform any further
acts and to execute, acknowledge and deliver any documents which may be
reasonably necessary to carry out the provisions of this Agreement.

     Section 14. Section Headings. The section headings used in this Agreement
are intended solely for convenience of reference and shall not in any manner
amplify, limit, modify or otherwise be used in the interpretation of any of the
provisions hereof.

     Section 15. Capitalized Terms. Capitalized terms used but not otherwise
defined herein shall have the meanings ascribed to them in the Chapter 11 Plan
of Reorganization confirmed by the United States Bankruptcy Court for the
Northern District of Illinois, Eastern Division, in the cases captioned In re
Venture Lighting International, Inc., et al., Case No. 03-05255 (the "Plan").

     Section 16. Counterparts. This Agreement may be executed in several
counterparts and all such executed counterparts shall constitute a single
agreement, binding on the parties hereto and their successors.

                                      -5-


     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first written above.


                                          ADVANCED LIGHTING TECHNOLOGIES, INC.


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



                                          SARATOGA MANAGEMENT COMPANY, LLC


                                          By:
                                              ----------------------------------
                                          Name: Christian L. Oberbeck
                                          Title: Managing Director






                                   EXHIBIT F
               to First Amended Chapter 11 Plan of Reorganization
               --------------------------------------------------

                      Forms of Senior Management Contracts
                      ------------------------------------




              [To be filed under a separate cover at a later date]