exv4w14






Exhibit 4.14




 





JEFFERIES GROUP, INC.,




Issuer




and




THE BANK OF NEW YORK MELLON,




Trustee




INDENTURE




Dated as of October ___, 2009




Convertible Securities




 






 









 








JEFFERIES GROUP, INC.

Certain Sections of this Indenture relating to

Sections 3.10 through 3.18, inclusive, of the

Trust Indenture Act of 1939:




					
	Trust Indenture	 	 
	Act Section	 	Indenture Section
	§ 310
	 	(a)(1)
	 	6.10
	 
	 	(a)(2)
	 	6.10
	 
	 	(a)(3)
	 	Not Applicable
	 
	 	(a)(4)
	 	Not Applicable
	 
	 	(a)(5)
	 	6.10
	 
	 	(b)
	 	6.08
	 
	 	 
	 	6.10
	 
	 	(c)
	 	Not Applicable
	§ 311
	 	(a)
	 	6.11
	 
	 	(b)
	 	6.11
	 
	 	(c)
	 	Not Applicable
	§ 312
	 	(a)
	 	7.01
	 
	 	 
	 	7.02
	 
	 	(b)
	 	7.02
	 
	 	(c)
	 	7.02
	§ 313
	 	(a)
	 	7.03
	 
	 	(b)
	 	7.03
	 
	 	(c)
	 	7.03
	 
	 	(d)
	 	7.03
	§ 314
	 	(a)
	 	7.04
	 
	 	(a)(4)
	 	1.01
	 
	 	 
	 	10.06
	 
	 	(b)
	 	Not Applicable
	 
	 	(c)(1)
	 	1.02
	 
	 	(c)(2)
	 	1.02
	 
	 	(c)(3)
	 	Not Applicable
	 
	 	(d)
	 	Not Applicable
	 
	 	(e)
	 	1.02
	§ 315
	 	(a)
	 	6.01
	 
	 	(b)
	 	6.05
	 
	 	(c)
	 	6.01
	 
	 	(d)
	 	6.01
	 
	 	(e)
	 	5.14
	§ 316
	 	(a)
	 	1.01
	 
	 	(a)(1)(A)
	 	5.02
	 
	 	 	 	5.12
	 
	 	 	 	5.13
	 
	 	(a)(1)(B)
	 	5.13
	 
	 	(a)(2)
	 	Not Applicable
	 
	 	(b)
	 	5.08
	 
	 	(c)
	 	1.04
	§ 317
	 	(a)(1)
	 	5.03
	 
	 	(a)(2)
	 	5.04
	 
	 	(b)
	 	10.03
	§ 318
	 	(a)
	 	1.07







			
	NOTE: 	 	   This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.






 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	PAGE
	ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
	 	 	1	 
	Section 1.01 Definitions
	 	 	1	 
	Section 1.02 Compliance Certificates and Opinions
	 	 	7	 
	Section 1.03 Form of Documents Delivered to Trustee
	 	 	8	 
	Section 1.04 Acts of Holders; Record Dates
	 	 	8	 
	Section 1.05 Notices, Etc., to Trustee and Company
	 	 	10	 
	Section 1.06 Notice to Holders; Waiver
	 	 	10	 
	Section 1.07 Conflict with Trust Indenture Act
	 	 	11	 
	Section 1.08 Effect of Headings and Table of Contents
	 	 	11	 
	Section 1.09 Successors and Assigns
	 	 	12	 
	Section 1.10 Separability Clause
	 	 	12	 
	Section 1.11 Benefits of Indenture
	 	 	12	 
	Section 1.12 Governing Law
	 	 	12	 
	Section 1.13 Legal Holidays
	 	 	12	 
	Section 1.14 Waiver of Jury Trial
	 	 	12	 
	Section 1.15 Force Majeure
	 	 	12	 
	ARTICLE II SECURITY FORMS
	 	 	13	 
	Section 2.01 Forms Generally
	 	 	13	 
	Section 2.02 Form of Face of Security
	 	 	13	 
	Section 2.03 Form of Reverse of Security
	 	 	15	 
	Section 2.04 Form of Legend for Global Securities
	 	 	20	 
	Section 2.05 Form of Trustee’s Certificate of Authentication
	 	 	20	 
	ARTICLE III THE SECURITIES
	 	 	21	 
	Section 3.01 Amount Unlimited; Issuable in Series
	 	 	21	 
	Section 3.02 Denominations
	 	 	23	 
	Section 3.03 Execution, Authentication, Delivery and Dating
	 	 	23	 
	Section 3.04 Temporary Securities
	 	 	25	 
	Section 3.05 Registration, Registration of Transfer and Exchange
	 	 	25	 
	Section 3.06 Mutilated, Destroyed, Lost and Stolen Securities
	 	 	27	 






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TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	PAGE
	Section 3.07 Payment of Interest; Interest Rights Preserved
	 	 	27	 
	Section 3.08 Persons Deemed Owners
	 	 	28	 
	Section 3.09 Cancellation
	 	 	29	 
	Section 3.10 Computation of Interest
	 	 	29	 
	Section 3.11 CUSIP Numbers
	 	 	29	 
	ARTICLE IV SATISFACTION AND DISCHARGE
	 	 	29	 
	Section 4.01 Satisfaction and Discharge of Indenture
	 	 	29	 
	Section 4.02 Application of Trust Money
	 	 	30	 
	ARTICLE V REMEDIES
	 	 	31	 
	Section 5.01 Events of Default
	 	 	31	 
	Section 5.02 Acceleration of Maturity; Rescission and Annulment
	 	 	32	 
	Section 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee
	 	 	33	 
	Section 5.04 Trustee May File Proofs of Claim
	 	 	34	 
	Section 5.05 Trustee May Enforce Claims Without Possession of Securities
	 	 	34	 
	Section 5.06 Application of Money Collected
	 	 	34	 
	Section 5.07 Limitation on Suits
	 	 	35	 
	Section 5.08 Unconditional Right of Holders to Receive Principal, Premium and Interest and to Convert
	 	 	35	 
	Section 5.09 Restoration of Rights and Remedies
	 	 	36	 
	Section 5.10 Rights and Remedies Cumulative
	 	 	36	 
	Section 5.11 Delay or Omission Not Waiver
	 	 	36	 
	Section 5.12 Control by Holders
	 	 	36	 
	Section 5.13 Waiver of Past Defaults
	 	 	37	 
	Section 5.14 Undertaking for Costs
	 	 	37	 
	Section 5.15 Waiver of Usury, Stay or Extension Laws
	 	 	37	 
	ARTICLE VI THE TRUSTEE
	 	 	38	 
	Section 6.01 Duties of Trustee
	 	 	38	 
	Section 6.02 Rights of Trustee
	 	 	39	 
	Section 6.03 Individual Rights of Trustee
	 	 	40	 
	Section 6.04 Trustee’s Disclaimer
	 	 	40	 






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TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	PAGE
	Section 6.05 Notice of Default
	 	 	40	 
	Section 6.06 Reports by Trustee to Holders
	 	 	40	 
	Section 6.07 Compensation and Indemnity
	 	 	41	 
	Section 6.08 Replacement of Trustee
	 	 	41	 
	Section 6.09 Successor Trustee by Merger, Etc
	 	 	42	 
	Section 6.10 Eligibility; Disqualification
	 	 	43	 
	Section 6.11 Preferential Collection of Claims against Company
	 	 	43	 
	ARTICLE VII HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY
	 	 	43	 
	Section 7.01 Company to Furnish Trustee Names and Addresses of Holders
	 	 	43	 
	Section 7.02 Preservation of Information; Communications to Holders
	 	 	43	 
	Section 7.03 Reports by Trustee
	 	 	44	 
	Section 7.04 Reports by Company
	 	 	44	 
	ARTICLE VIII CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
	 	 	44	 
	Section 8.01 When Company May Merge, Etc
	 	 	44	 
	Section 8.02 Successor Corporation Substituted
	 	 	45	 
	ARTICLE IX SUPPLEMENTAL INDENTURES
	 	 	45	 
	Section 9.01 Supplemental Indentures Without Consent of Holders
	 	 	45	 
	Section 9.02 Supplemental Indentures with Consent of Holders
	 	 	46	 
	Section 9.03 Execution of Supplemental Indentures
	 	 	48	 
	Section 9.04 Effect of Supplemental Indentures
	 	 	48	 
	Section 9.05 Conformity with Trust Indenture Act
	 	 	48	 
	Section 9.06 Reference in Securities to Supplemental Indentures
	 	 	48	 
	ARTICLE X COVENANTS
	 	 	48	 
	Section 10.01 Payment of Securities
	 	 	48	 
	Section 10.02 Maintenance of Office or Agency
	 	 	49	 
	Section 10.03 Money for Securities Payments to Be Held in Trust
	 	 	49	 
	Section 10.04 Corporate Existence
	 	 	50	 
	Section 10.05 Payment of Taxes and Other Claims
	 	 	50	 
	Section 10.06 Compliance Certificate; Notice of Default
	 	 	51	 






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TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	PAGE
	Section 10.07 Waiver of Stay, Extension or Usury Laws
	 	 	51	 
	ARTICLE XI REDEMPTION OF SECURITIES
	 	 	52	 
	Section 11.01 Applicability of Article
	 	 	52	 
	Section 11.02 Election to Redeem; Notice to Trustee
	 	 	52	 
	Section 11.03 Selection by Trustee of Securities to Be Redeemed
	 	 	52	 
	Section 11.04 Notice of Redemption
	 	 	53	 
	Section 11.05 Deposit of Redemption Price
	 	 	53	 
	Section 11.06 Securities Payable on Redemption Date
	 	 	54	 
	Section 11.07 Securities Redeemed in Part
	 	 	54	 
	ARTICLE XII SINKING FUNDS
	 	 	54	 
	Section 12.01 Applicability of Article
	 	 	54	 
	Section 12.02 Satisfaction of Sinking Fund Payments with Securities
	 	 	55	 
	Section 12.03 Redemption of Securities for Sinking Fund
	 	 	55	 
	ARTICLE XIII CONVERSION OF SECURITIES
	 	 	55	 
	Section 13.01 Applicability; Conversion Privilege and Conversion Price
	 	 	55	 
	Section 13.02 Exercise of Conversion Privilege
	 	 	56	 
	Section 13.03 Fractions of Shares
	 	 	57	 
	Section 13.04 Adjustment of Conversion Price
	 	 	57	 
	Section 13.05 Notice of Adjustments of Conversion Price
	 	 	59	 
	Section 13.06 Notice of Certain Corporate Action
	 	 	60	 
	Section 13.07 Company to Reserve Common Stock
	 	 	61	 
	Section 13.08 Taxes on Conversions
	 	 	61	 
	Section 13.09 Covenant as to Common Stock
	 	 	61	 
	Section 13.10 Cancellation of Converted Securities
	 	 	61	 
	Section 13.11 Provisions in Case of Consolidation, Merger or Sale of Assets
	 	 	61	 
	Section 13.12 Responsibility of Trustee
	 	 	62	 






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     INDENTURE, dated as of October ___, 2009, between Jefferies Group, Inc., a corporation duly
organized and existing under the laws of the State of Delaware (herein called the “Company”),
having its principal office at 520 Madison Avenue, 12th Floor, New York, NY 10022 and The Bank of
New York Mellon, a New York banking corporation, as Trustee (herein called the “Trustee”).



RECITALS OF THE COMPANY




     The Company has duly authorized the execution and delivery of this Indenture to provide for
the issuance from time to time of its unsecured debentures, notes or other evidences of
indebtedness (herein called the “Securities”), to be issued in one or more series as in this
Indenture provided.



     All things necessary to make this Indenture a valid and legally binding agreement of the
Company, in accordance with its terms, have been done.



     NOW, THEREFORE, THIS INDENTURE WITNESSETH:



     For and in consideration of the premises and the purchase of the Securities by the Holders
thereof, it is mutually agreed, for the equal and proportionate benefit of all Holders of the
Securities or of series thereof, as follows:



ARTICLE I




DEFINITIONS AND OTHER PROVISIONS OF

GENERAL APPLICATION




   Section 1.01 Definitions.



          For all purposes of this Indenture, except as otherwise expressly provided or unless the
context otherwise requires:




               (1) the terms defined in this Article have the meanings assigned to them in this Article and
include the plural as well as the singular;



               (2) all other terms used herein which are defined in the Trust Indenture Act, either directly
or by reference therein, have the meanings assigned to them therein;



               (3) all accounting terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles, and, except as otherwise herein expressly
provided, the term GAAP with respect to any computation required or permitted hereunder shall mean
such accounting principles as are generally accepted at the date of such computation;



               (4) the words “Article” and “Section” refer to an Article and Section, respectively, of this
Indenture;



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               (5) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or other subdivision; and



               (6) Certain terms used principally in Articles VI, X and XIII, are defined in those Articles.



          “Act”, when used with respect to any Holder, has the meaning specified in Section
1.04.




          “Affiliate” of any specified Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with such specified Person.
For the purposes of this definition, “control” when used with respect to any specified Person
means the power to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise; and the terms
“controlling” and “controlled” have meanings correlative to the foregoing.




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




          “Board of Directors” means either the board of directors of the Company or any duly
authorized committee of that board.




          “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.




          “Business Day”, when used with respect to any Place of Payment, means each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that
Place of Payment are authorized or obligated by law or executive order to close.




          “Capital Lease Obligation” means, at any time any determination thereof is made, the
amount of the liability in respect of a capital lease that would at such time be so required to be
capitalized on the balance sheet in accordance with generally accepted accounting principles.




          “Commission” means the Securities and Exchange Commission, 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
Trust Indenture Act, then the body performing such duties at such time.




          “Common Stock” includes any stock of any class of the Company which has no preference
in respect of dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding-up of the Company and which is not subject to redemption by the
Company. However, subject to the provisions of Section 3.01(15) and (16) and Section 13.11, shares
issuable on conversion of Securities shall include only shares of the class designated as Common
Stock of the Company at the date of this instrument or shares of any class or classes resulting
from any reclassification or reclassifications thereof and which have no preference in respect of
dividends or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding-up of the Company and which are not subject to



-2-









 






redemption by the Company; provided that if at any time there shall be more than one
such resulting class, the shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all such reclassifications
bears to the total number of shares of all such classes resulting from all such reclassifications.




          “Company” means the Person named as the “Company” in the first paragraph of this
instrument until a successor Person shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter “Company” shall mean such successor Person.




          “Company Request” or “Company Order” means a written request or order signed
in the name of the Company by its Chairman of the Board, any Vice Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.




          “Conversion Agent” means the transfer agent for the Company’s Common Stock, which as
of the date hereof is [                    ], or such other Person as the Company may name from
time to time.




          “Corporate Trust Office” means the principal office of the Trustee in New York, New
York at which at any particular time its corporate trust business shall be administered, which
office as of the date hereof is located at 5 Penn Plaza, 13th Floor, New York, NY 10001.




          “Corporation” means a corporation, association, company, joint-stock company or
business trust.




          “Defaulted Interest” has the meaning specified in Section 3.07.




          “Depositary” means, with respect to Securities of any series issuable in whole or in
part in the form of one or more Global Securities, a clearing agency registered under the Exchange
Act that is designated to act as Depositary for such Securities as contemplated by Section 3.01.




          “Event of Default” has the meaning specified in Section 5.01.




          “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to
time, and any statute successor thereto.




          “GAAP” means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Standards Board or in such other
statements by such other entity as have been approved by a significant segment of the accounting
profession.




          “Global Security” means a Security that evidences all or part of the Securities of any
series and is authenticated and delivered to, and registered in the name of, the Depositary for
such Securities or a nominee thereof.




          “Guaranty” means a guarantee (other than by endorsement of negotiable instruments for
collection in the ordinary course of business), direct or indirect, in any manner (including,



-3-









 






without limitation, letters of credit and reimbursement agreements in respect thereof), or all
or any part of any Indebtedness.




          “Hedging Obligations” means, with respect to any Person, the Obligations of such
Person under interest rate swap agreements, interest rate cap agreements, and interest rate collar
agreements, and other agreements or arrangements designed to protect such Person against
fluctuations in interest rates.




          “Holder” means a Person in whose name a Security is registered in the Security
Register.




          “Indebtedness” means, with respect to any Person, any indebtedness of such Person,
whether or not contingent, in respect of borrowed money or evidenced by bonds, notes, debentures of
similar instruments or letters of credit (or reimbursement agreements in respect thereof) or
representing Capital Lease Obligations or the balance deferred and unpaid of the purchase price of
any property or representing any Hedging Obligations, except any such balance that constitutes an
accrued expense or trade payable, if and to the extent any of the foregoing indebtedness (other
than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of
such Person prepared in accordance with GAAP, and also includes, to the extent not otherwise
included, the Guaranty of any indebtedness of such Person or any other Person.




          “Indenture” means this instrument as originally executed or as it may from time to
time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof, including, for all purposes of this instrument, and any such
supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of
and govern this instrument and any such supplemental indenture, respectively. The term “Indenture”
shall also include the terms of particular series of Securities established as contemplated by
Section 3.01.




          “Interest”, when used with respect to an Original Issue Discount Security which by its
terms bears interest only after Maturity, means interest payable after Maturity.




          “Interest Payment Date”, when used with respect to any Security, means the Stated
Maturity of an installment of interest on such Security.




          “Lien” means any mortgage, lien, pledge, charge, security interest, or other
encumbrance of any kind, whether or not filed, recorded or otherwise perfected under applicable
law.




          “Maturity”, when used with respect to any Security, means the date on which the
principal of such Security or an installment of principal becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of acceleration, call for
redemption or otherwise.




          “Notice of Default” means a written notice of the kind specified in Section 5.01(4).




          “Obligations” means any principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under the documentation
governing and Indebtedness.




-4-









 








          “Officers’ Certificate” means a certificate signed by the Chairman of the Board, a
Vice Chairman of the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Company, and delivered to the Trustee.
One of the officers signing an Officers’ Certificate given pursuant to Section 10.06 shall be the
principal executive, financial or accounting officer of the Company.




          “Opinion of Counsel” means a written opinion of counsel, who may be counsel for the
Company.




          “Original Issue Discount Security” means any Security which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration of acceleration of
the Maturity thereof pursuant to Section 5.02.




          “Outstanding”, when used with respect to Securities, means, as of the date of
determination, all Securities theretofore authenticated and delivered under this Indenture, except:




               (1) Securities theretofore cancelled by the Trustee or delivered to the Trustee for
cancellation;



               (2) Securities for whose payment or redemption money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set
aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for
the Holders of such Securities; provided that, if such Securities 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;



               (3) Securities which have been paid pursuant to Section 3.06 or in exchange for or in lieu of
which other Securities have been authenticated and delivered pursuant to this Indenture, other than
any such Securities in respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company; provided, however, that in determining whether the
Holders of the requisite principal amount of the Outstanding Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, (A) the principal amount of
an Original Issue Discount Security that shall be deemed to be Outstanding shall be the amount of
the principal thereof that would be due and payable as of the date of such determination upon
acceleration of the Maturity thereof to such date pursuant to Section 5.02, (B) the principal
amount of a Security denominated in one or more foreign currencies or currency units shall be the
U.S. dollar equivalent, determined in the manner provided as contemplated by Section 3.01 on the
date of original issuance of such Security, of the principal amount (or, in the case of an Original
Issue Discount Security, the U.S. dollar equivalent on the date of original issuance of such
Security of the amount determined as provided in Clause (A) above) of such Security, and (C)
Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Securities which a Responsible
Officer of the Trustee actually knows to be so owned shall be so disregarded. Securities so owned
which have been pledged in



-5-









 







good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of
the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is
not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such
other obligor.



          “Paying Agent” means any Person authorized by the Company to pay the principal of or
any premium or interest on any Securities on behalf of the Company.




          “Person” means any individual, corporation, partnership, joint venture, limited
liability company, joint stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.




          “Place of Payment”, when used with respect to the Securities of any series, means the
place or places where the principal of and any premium and interest on the Securities of that
series are payable as specified as contemplated by Section 3.01.




          “Predecessor Security” of any particular Security means every previous Security
evidencing all or a portion of the same debt as that evidenced by such particular Security; and,
for the purposes of this definition, any Security authenticated and delivered under Section 3.06 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.




          “Redemption Date”, when used with respect to any Security to be redeemed, means the
date fixed for such redemption by or pursuant to this Indenture.




          “Redemption Price”, when used with respect to any Security to be redeemed, means the
price at which it is to be redeemed pursuant to this Indenture.




          “Regular Record Date” for the interest payable on any Interest Payment Date on the
Securities of any series means the date specified for that purpose as contemplated by Section 3.01.




          “Responsible Officer”, when used with respect to the Trustee, means any vice
president, any assistant treasurer, any trust officer or assistant trust officer or any other
officer of the Trustee customarily performing functions similar to those performed by any of the
above designated officers and also means, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of his knowledge of and familiarity with the
particular subject and who shall have direct responsibility for the administration of this
Indenture.




          “Securities” has the meaning stated in the first recital of this Indenture and more
particularly means any Securities authenticated and delivered under this Indenture.




          “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the Securities and Exchange Commission promulgated thereunder.




          “Security Register” and “Security Registrar” have the respective meanings specified in
Section 3.05.




-6-









 








          “Special Record Date” for the payment of any Defaulted Interest means a date fixed by
the Trustee pursuant to Section 3.07.




          “Stated Maturity”, when used with respect to any Security or any installment of
principal thereof or interest thereon, means the date specified in such Security as the fixed date
on which the principal of such Security or such installment of principal or interest is due and
payable.




          “Subsidiary” means a corporation more than 50% of the outstanding voting stock of
which is owned, directly or indirectly, by the Company or by one or more other Subsidiaries, or by
the Company and one or more other Subsidiaries. For the purposes of this definition, “voting
stock” means stock which ordinarily has voting power for the election of directors, whether at all
times or only so long as no senior class of stock has such voting power by reason of any
contingency.




          “Trust Indenture Act” means the Trust Indenture Act of 1939 as in force at the date as
of which this instrument was executed; provided, however, that in the event the Trust Indenture Act
of 1939 is amended after such date, “Trust Indenture Act” means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.




          “Trustee” means the Person named as the “Trustee” in the first paragraph of this
instrument until a successor Trustee shall have become such pursuant to the applicable provisions
of this Indenture, and thereafter “Trustee” shall mean or include each Person who is then a Trustee
hereunder, and if at any time there is more than one such Person, “Trustee” as used with respect to
the Securities of any series shall mean each Trustee with respect to Securities of that series.




          “Vice President”, when used with respect to the Company or the Trustee, means any vice
president, whether or not designated by a number or a word or words added before or after the title
“vice president”.




     Section 1.02 Compliance Certificates and Opinions.



          Upon any application or request by the Company to the Trustee to take any action under any
provision of this Indenture, the Company shall furnish to the Trustee such certificates and
opinions as may be required under the Trust Indenture Act. Each such certificate or opinion shall
be given in the form of an Officers’ Certificate, if to be given by an officer of the Company, or
an Opinion of Counsel, if to be given by counsel, and shall comply with the requirements of the
Trust Indenture Act and any other requirements set forth in this Indenture.




          Every certificate or opinion with respect to compliance with a condition or covenant provided
for in this Indenture (including certificates provided for in Section 10.06) shall include:




               (1) a statement that each individual signing such certificate or opinion has read such
covenant or condition and the definitions herein relating thereto;



               (2) a brief statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are based;



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               (3) a statement that, in the opinion of each such individual, 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



               (4) a statement as to whether, in the opinion of each such individual, such condition or
covenant has been complied with.



     Section 1.03 Form of Documents Delivered to Trustee.



          In any case where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified by, or covered by
the opinion of, only one such Person, or that they be so certified or covered by only one document,
but one such Person may certify or give an opinion with respect to some matters and one or more
other such Persons as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.




          Any certificate or opinion of an officer of the Company may be based, insofar as it relates to
legal matters, upon a certificate or opinion of, or representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the certificate or opinion
or representations with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an officer or officers of
the Company or any subsidiary of the Company stating that the information with respect to such
factual matters is in the possession of the Company or any subsidiary of the Company, unless such
counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion
or representations with respect to such matters are erroneous.




          Where any Person is required to make, give or execute two or more applications, requests,
consents, certificates, statements, opinions or other instruments under this Indenture, they may,
but need not, be consolidated and form one instrument.




     Section 1.04 Acts of Holders; Record Dates.



          Any request, demand, authorization, direction, notice, consent, waiver or other action
provided or permitted by this Indenture to be given or taken by Holders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by such Holders in
person or by agent duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are delivered to the Trustee
and, where it is hereby expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of
the Holders signing such instrument or instruments. Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and
(subject to Section 6.01) conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.




          The fact and date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by a certificate of a notary public or
other officer authorized by law to take acknowledgments of deeds, certifying that the individual



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signing such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual capacity, such certificate
or affidavit shall also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner which the Trustee deems sufficient.




          The ownership of Securities shall be proved by the Security Register.




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




          The Company may, in the circumstances permitted by the Trust Indenture Act, set any day as the
record date for the purpose of determining the Holders of Outstanding Securities of any series
entitled to give or take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given or taken by Holders of Securities
of such series. With regard to any record date set pursuant to this paragraph, the Holders of
Outstanding Securities of the relevant series on such record date (or their duly appointed agents),
and only such Persons, shall be entitled to give or take the relevant action, whether or not such
Holders remain Holders after such record date. With regard to any action that may be given or
taken hereunder only by Holders of a requisite principal amount of Outstanding Securities of any
series (or their duly appointed agents) and for which a record date is set pursuant to this
paragraph, the Company may, at its option, set an expiration date after which no such action
purported to be given or taken by any Holder shall be effective hereunder unless given or taken on
or prior to such expiration date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date (or their duly appointed agents). On or prior to any
expiration date set pursuant to this paragraph, the Company may, on one or more occasions at its
option, extend such date to any later date. Nothing in this paragraph shall prevent any Holder (or
any duly appointed agent thereof) from giving or taking, after any such expiration date, any action
identical to, or, at any time, contrary to or different from, the action or purported action to
which such expiration date relates, in which event the Company may set a record date in respect
thereof pursuant to this paragraph. Nothing in this paragraph shall be construed to render
ineffective any action taken at any time by the Holders (or their duly appointed agents) of the
requisite principal amount of Outstanding Securities of the relevant series on the date such action
is so taken. Notwithstanding the foregoing or the Trust Indenture Act, the Company shall not set a
record date for, and the provisions of this paragraph shall not apply with respect to, any notice,
declaration or direction referred to in the next paragraph.




          The Trustee may set any day as a record date for the purpose of determining the Holders of
Outstanding Securities of any series entitled to join in the giving or making of (i) any Notice of
Default, (ii) any declaration of acceleration referred to in Section 5.02, if an Event of Default
with respect to Securities of such series has occurred and is continuing and the Trustee shall not
have given such a declaration to the Company, (iii) any request to institute proceedings referred
to in Section 5.07(2) or (iv) any direction referred to in Section 5.12, in each case with respect
to Securities of such series. Promptly after any record date is set pursuant to this paragraph,
the



-9-









 






Trustee shall notify the Company and the Holders of Outstanding Series of such series of any
such record date so fixed and the proposed action. The Holders of Outstanding Securities of such
series on such record date (or their duly appointed agents), and only such Persons, shall be
entitled to join in such notice, declaration or direction, whether or not such Holders remain
Holders after such record date; provided that, unless such notice, declaration or direction shall
have become effective by virtue of Holders of the requisite principal amount of Outstanding
Securities of such series on such record date (or their duly appointed agents) having joined
therein on or prior to the 90th day after such record date, such notice, declaration or direction
shall automatically and without any action by any Person be cancelled and of no further effect.
Nothing in this paragraph shall be construed to prevent a Holder (or a duly appointed agent
thereof) from giving, before or after the expiration of such 90-day period, a notice, declaration
or direction contrary to or different from, or, after the expiration of such period, identical to,
the notice, declaration or direction to which such record date relates, in which event a new record
date in respect thereof shall be set pursuant to this paragraph. Nothing in this paragraph shall
be construed to render ineffective any notice, declaration or direction of the type referred to in
this paragraph given at any time to the Trustee and the Company by Holders (or their duly appointed
agents) of the requisite principal amount of Outstanding Securities of the relevant series on the
date such notice, declaration or direction is so given.




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




     Section 1.05 Notices, Etc., to Trustee and Company.



          Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or furnished to, or
filed with:




               (1) the Trustee by any Holder or by the Company shall be sufficient for every purpose
hereunder if made, given, furnished or filed in writing (which may be via facsimile) to or with the
Trustee at its Corporate Trust Office, Attention: Corporate Trust Department; or



               (2) the Company by the Trustee or by any Holder shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class
postage prepaid, to the Company addressed to it at the address of its principal office specified in
the first paragraph of this instrument or at any other address previously furnished in writing to
the Trustee by the Company.



     Section 1.06 Notice to Holders; Waiver.



          Where this Indenture provides for notice to Holders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at his address as it appears in
the Security Register, not later than the latest date (if any), and not earlier than the earliest
date (if



-10-









 






any), prescribed for the giving of such notice. In any case where notice to Holders is given
by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to other Holders. 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.




     Section 1.07 Conflict with Trust Indenture Act.



          If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture
Act that is required under such Act to be a part of and govern this Indenture, the latter provision
shall control. If any provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to
this Indenture as so modified or to be excluded, as the case may be. Wherever this Indenture
refers to a provision of the Trust Indenture Act, such provision is incorporated by reference in
and made a part of this Indenture.




          The following Trust Indenture Act terms used in this Indenture have the following meanings:




          “commission” means the United States Securities and Exchange Commission.




          “indenture securities” means the Securities.




          “indenture security holder” means a Holder.




          “indenture to be qualified” means this Indenture.




          “indenture trustee” or “institutional trustee” means the Trustee.




          “obligor on the indenture securities” means the Company and any other obligor on the
Securities.




          All other Trust Indenture Act terms used in this Indenture that are defined by the Trust
Indenture Act, defined by the Trust Indenture Act referenced to another statute or defined by any
Commission Rule and not otherwise defined herein have the meanings defined to them thereby.




     Section 1.08 Effect of Headings and Table of Contents.



          The Article and Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.




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     Section 1.09 Successors and Assigns.



          All covenants and agreements in this Indenture by the Company shall bind its successors and
assigns, whether so expressed or not.




     Section 1.10 Separability Clause.



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




     Section 1.11 Benefits of Indenture.



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




     Section 1.12 Governing Law.



          This Indenture and the Securities shall be governed by and construed in accordance with the
law of the State of New York, but without regard to principles of conflicts of laws.




     Section 1.13 Legal Holidays.



          In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any
Security or the last date on which a Holder has the right to convert his Securities shall not be a
Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture
or of the Securities (other than a provision of the Securities of any series which specifically
states that such provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) or conversion of the Securities need not be made at such Place of Payment on
such date, but may be made on the next succeeding Business Day at such Place of Payment with the
same force and effect as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, or on such last day for conversion, provided that no interest shall accrue for the period
from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.




     Section 1.14 Waiver of Jury Trial.



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




     Section 1.15 Force Majeure.



          In no event shall the Trustee be responsible or liable for any failure or delay in the
performance of its obligations hereunder arising out of or caused by, directly or indirectly,
forces



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beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war
or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and
interruptions, loss or malfunctions of utilities, communications or computer (software and
hardware) services; it being understood that the Trustee shall use reasonable efforts which are
consistent with accepted practices in the banking industry to resume performance as soon as
practicable under the circumstances.




ARTICLE II




SECURITY FORMS




     Section 2.01 Forms Generally.



          The Securities of each series shall be in substantially the form set forth in this Article, or
in such other form as shall be established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Securities, as evidenced by
their execution of the Securities. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall
be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Company Order contemplated by Section 3.03 for the
authentication and delivery of such Securities.




          The definitive Securities shall be printed, lithographed or engraved on steel engraved borders
or may be produced in any other manner, all as determined by the officers executing such
Securities, as evidenced by their execution of such Securities.




     Section 2.02 Form of Face of Security.



          [Insert any legend required by the Internal Revenue Code and the regulations thereunder.]




JEFFERIES GROUP, INC.




			
	 	 	 
	No.
	 	$                    






          Jefferies Group, Inc., a corporation duly organized and existing under the laws of Delaware
(herein called the “Company”, which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
                                        , or registered assigns, the principal sum of
                                          Dollars on                     
                     [if the Security is to bear interest prior to Maturity, insert —, and
to pay interest thereon from                      or from the most recent Interest




-13-









 







Payment Date to which interest has been paid or duly provided for, semi-annually on
                     and                      in each year, commencing                      at the rate of ___% per annum,
until the principal hereof is paid or made available for payment [if applicable, insert —, and at
the rate of ___% per annum on any overdue principal and premium and on any overdue installment of
interest]. The interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the ___or ___(whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this Security (or one or
more Predecessor Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to
Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture].




          [If the Security is not to bear interest prior to Maturity, insert — The principal of this
Security shall not bear interest except in the case of a default in payment of principal upon
acceleration, upon redemption or at Stated Maturity and in such case the overdue principal of this
Security shall bear interest at the rate of ___% per annum, which shall accrue from the date of
such default in payment to the date payment of such principal has been made or duly provided for.
Interest on any overdue principal shall be payable on demand. Any such interest on any overdue
principal that is not so paid on demand shall bear interest at the rate of ___% per annum,
which shall accrue from the date of such demand for payment to the date payment of such interest
has been made or duly provided for, and such interest shall also be payable on demand.]




          Payment of the principal of (and premium, if any) and [if applicable, insert — any such]
interest on this Security will be made at the office or agency of the Company maintained for that
purpose in ___, in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts [if applicable, insert —;
provided, however, that at the option of the Company payment of interest may be made by check
mailed to the address of the Person entitled thereto as such address shall appear in the Security
Register].




          Reference is hereby made to the further provisions of this Security set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.




          Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.




-14-









 








          IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal.




Dated:




	 	 	 	 	 
	 	JEFFERIES GROUP, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Attest:




                                                            





     Section 2.03 Form of Reverse of Security.



          This Security is one of a duly authorized issue of securities of the Company (herein called
the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of
___, 2009 (herein called the “Indenture”), between the Company and The Bank of New
York Mellon, as Trustee (herein called the “Trustee”, which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto reference is
hereby made for a statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered. This Security is one of the
series designated on the face hereof [if applicable insert —, limited in aggregate principal
amount to $___].




          [If applicable, insert — Subject to and upon compliance with the provisions of the
Indenture, the Holder of this Security is entitled, at his option, at any time on or before the
close of business on                 , or in case this Security or a portion hereof is
called for redemption, then in respect of this Security or such portion hereof until and including,
but (unless the Company defaults in making the payment due upon redemption) not after, the close of
business on the 10th calendar day before the Redemption Date, to convert this Security (or any
portion of the principal amount hereof which is $1,000 or an integral multiple thereof), at the
principal amount hereof, or of such portion, into fully paid and non-assessable shares (calculated
as to each conversion to the nearest 1/100 of a share) of Common Stock of the Company at a
conversion price per share of Common Stock equal to $              per each share of Common
Stock (or at the current adjusted conversion price if an adjustment has been made as provided in
the Indenture) by surrender of this Security, duly endorsed or assigned to the Company or in blank,
to the Company at its office or agency in                      , accompanied by written
notice to the Company that the Holder hereof elects to convert this Security, or if less than the
entire principal amount hereof is to be converted, the portion hereof to be converted, and, in case
such surrender shall be made during the period from the close of business on any Regular Record
Date next preceding any Interest Payment Date to the opening of business on such Interest Payment
Date (unless this Security or the portion thereof being converted has been called for redemption



-15-









 






on a Redemption Date within such period), also accompanied by payment in funds acceptable to
the Company of an amount equal to the interest payable on such Interest Payment Date on the
principal amount of this Security then being converted. Subject to the aforesaid requirement for
payment and, in the case of a conversion after the Regular Record Date next preceding any Interest
Payment Date and on or before such Interest Payment Date, to the right of the Holder of this
Security (or any Predecessor Security) of record at such Regular Record Date to receive an
installment of interest (with certain exceptions provided in the Indenture), no payment or
adjustment is to be made on conversion for interest accrued hereon or for dividends on the Common
Stock issued on conversion. No fractions of shares or scrip representing fractions of shares will
be issued on conversion, but instead of any fractional interest the Company shall pay a cash
adjustment as provided in the Indenture. The conversion price is subject to adjustment as provided
in the Indenture. In addition, the Indenture provides that in case of certain consolidations or
mergers to which the Company is a party or the transfer of substantially all of the assets of the
Company, the Indenture shall be amended, without the consent of any Holders of Securities, so that
this Security, if then outstanding, will be convertible thereafter, during the period this Security
shall be convertible as specified above, only into the kind and amount of securities, cash and
other property receivable upon the consolidation, merger or transfer by a holder of the number of
shares of Common Stock into which this Security might have been converted immediately prior to such
consolidation, merger or transfer (assuming such holder of Common Stock failed to exercise any
rights of election and received per share the kind and amount received per share by a plurality of
non-electing shares).]




     [If applicable insert — The Securities of this series are subject to redemption upon not less
than 30 days’ notice by mail, [if applicable, insert — (1) on ___ in any year commencing
with the year ___ and ending with the year ___ through operation of the sinking fund for this
series at a Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable insert on or after ___, 20___], as a whole or in part, at the election of the
Company, at the following Redemption Prices (expressed as percentages of the principal amount): If
redeemed [if applicable insert — on or before ___, ___%, and if redeemed] during the
12-month period beginning ___ of the years indicated,



	 	 	 	 	 	 	 
	Year	 	Redemption Price	 	Year	 	Redemption Price
	 
	 	 	 	 	 	 




and thereafter at a Redemption Price equal to ___% of the principal amount, together in the case
of any such redemption [if applicable, insert — (whether through operation of the sinking fund or
otherwise)] with accrued interest to the Redemption Date, but interest installments whose Stated
Maturity is on or prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the relevant Record
Dates referred to on the face hereof, all as provided in the Indenture.




          [If applicable, insert — The Securities of this series are subject to redemption upon not
less than 30 days’ notice by mail, (1) on ___ in any year commencing with the year ___
and ending with the year ___ through operation of the sinking fund for this series at the
Redemption Prices for redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if applicable, insert —
on or after ___], as a whole or in part, at the election of the



-16-









 






Company, at the Redemption Prices for redemption otherwise than through operation of the
sinking fund (expressed as percentages of the principal amount) set forth in the table below: If
redeemed during the 12-month period beginning ___ of the years indicated,




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Redemption Price
	 	 	 	 	Redemption Price	 	for Redemption
	 	 	 	 	for Redemption Through	 	Otherwise Than Through
	Year	 	Operation of the Sinking Fund	 	Operation of the Sinking Fund




and thereafter at a Redemption Price equal to ___% of the principal amount, together in the case
of any such redemption (whether through operation of the sinking fund or otherwise) with accrued
interest to the Redemption Date, but interest installments whose Stated Maturity is on or prior to
such Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor
Securities, of record at the close of business on the relevant Record Dates referred to on the face
hereof, all as provided in the Indenture.]




          [If applicable, insert — Notwithstanding the foregoing, the Company may not, prior to
___ redeem any Securities of this series as contemplated by [if applicable, insert —
Clause (2) of] the preceding paragraph as a part of, or in anticipation of, any refunding operation
by the application, directly or indirectly, of moneys borrowed having an interest cost to the
Company (calculated in accordance with generally accepted financial practice) of less than ___%
per annum.]




          [If applicable, insert — The sinking fund for this series provides for the redemption on
___ in each year beginning with the year ___ and ending with the year ___ of [if
applicable, insert — not less than $___“mandatory sinking fund”) and not more than]
$___aggregate principal amount of Securities of this series. Securities of this series
acquired or redeemed by the Company otherwise than through (if applicable, insert — mandatory]
sinking fund payments [if applicable, insert — and Securities surrendered for conversion]
may be credited against subsequent [if applicable, insert — mandatory] sinking fund payments
otherwise required to be made [if applicable, insert — in the inverse order in which they become
due).]




          [If the Security is subject to redemption of any kind, insert — In the event of redemption of
this Security in part only, a new Security or Securities of this series and of like tenor for the
unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation
hereof.]




          [If the Security is subject to conversion of any kind, insert — In the event of
conversion of this Security in part only, a new Security or Securities of this series and of like
tenor for the unconverted portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.]




          [If the Security is not an Original Issue Discount Security, insert — If an Event of Default
with respect to Securities of this series shall occur and be continuing, the principal of the




-17-









 







Securities of this series may be declared due and payable in the manner and with the effect
provided in the Indenture.]




          [If the Security is an Original Issue Discount Security, insert — If an Event of Default with
respect to Securities of this series shall occur and be continuing, an amount of principal of the
Securities of this series may be declared due and payable in the manner and with the effect
provided in the Indenture. Such amount shall be equal to insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable and (ii) of
interest on any overdue principal and overdue interest all of the Company’s obligations in respect
of the payment of the principal of and interest, if any, on the Securities of this series shall
terminate.]




          The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Securities of each series to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in principal amount of the Securities at the
time Outstanding of each series to be affected. The Indenture also contains provisions permitting
the Holders of specified percentages in principal amount of the Securities of each series at the
time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults under the Indenture
and their consequences. Any such consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.




          As provided in and subject to the provisions of the Indenture, the Holder of this Security
shall not have the right to institute any proceeding with respect to the Indenture or for the
appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall
have previously given the Trustee written notice of a continuing Event of Default with respect to
the Securities of this series, the Holders of not less than 25% in principal amount of the
Securities of this series at the time Outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default as Trustee and offered the Trustee
reasonable indemnity and the Trustee shall not have received from the Holders of a majority in
principal amount of Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60 days after receipt of
such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted
by the Holder of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed herein [Insert, if
applicable — or for enforcement of the right to convert this Security as provided in the
Indenture].




          No reference herein to the Indenture and no provision of this Security or of the Indenture
shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay
the principal of and any premium and interest on this Security at the times, place and rate, and in
the coin or currency, herein prescribed or to convert this Security as provided in the Indenture.




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          As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Security is registerable in the Security Register, upon surrender of this Security
for registration of transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.




          The Securities of this series are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.




          No service charge shall be made for any such registration of transfer or exchange, but the
Company or the Security Registrar may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.




          Prior to due presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.




          All terms used in this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.




          [If applicable, insert —




[FORM OF CONVERSION NOTICE]




To: JEFFERIES GROUP, INC.




          The undersigned owner of this Security hereby irrevocably exercises the option to convert this
Security, or portion hereof (which is $1,000 or an integral multiple thereof) below designated,
into shares of Common Stock of Jefferies Group, Inc., in accordance with the terms of the Indenture
referred to in this Security, and directs that the shares issuable and deliverable upon the
conversion, together with any payment for fractional shares and any Securities, representing any
unconverted principal amount hereof, be issued and delivered to the registered holder hereof unless
a different name has been indicated below. If shares are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes payable with respect
thereto. Any amount required to be paid by the undersigned on account of interest accompanies this
Security.




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	Dated:
	 	 	 	 
	 
	 	 	 	 
	Fill in for
registration of shares of Common
Stock and
Securities if to be
issued otherwise
than to the
registered holder.

	 	Principal Amount to be converted (in an integral multiple of $1,000, if less
than all):

 $

	 	 	 	 	 
	 
	 	 	 	 
	Name
	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 
	Address

	 	 
	 	 	 
	 
	 	Signature
	 
	 	 	 	 
	(Please print name
and address,
including zip code
number)
	 	 	 	 
	 
	 	 	 	 
	SOCIAL SECURITY OR OTHER TAXPAYER IDENTIFYING NUMBER
	 	[SIGNATURE GUARANTEED required only if Common Stock and Securities are to be
issued and delivered to other than registered holder]

	 
	 	 	 	 
	[

	 	 	 	]
	 	 	 





     Section 2.04 Form of Legend for Global Securities.



          Unless otherwise specified as contemplated by Section 3.01 for the Securities evidenced
thereby, every Global Security authenticated and delivered hereunder shall bear a legend in
substantially the following form:




          This Security is a Global Security within the meaning of the Indenture hereinafter referred to
and is registered in the name of a Depositary or a nominee thereof. This Security may not be
transferred to, or registered or exchanged for Securities registered in the name of, any Person
other than the Depositary or a nominee thereof and no such transfer may be registered, except in
the limited circumstances described in the Indenture. Every Security authenticated and delivered
upon registration of transfer of, or in exchange for or in lieu of, this Security shall be a Global
Security subject to the foregoing, except in such limited circumstances.




     Section 2.05 Form of Trustee’s Certificate of Authentication.



          The Trustee’s certificates of authentication shall be in substantially the following form:




          This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.




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	 	 	THE BANK OF NEW YORK MELLON, as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	     Authorized Signatory	 	 
	 	 	Dated:	 	 






ARTICLE III




THE SECURITIES




     Section 3.01 Amount Unlimited; Issuable in Series.



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




          The Securities may be issued in one or more series. There shall be established in or pursuant
to a Board Resolution and, subject to Section 3.03, set forth, or determined in the manner
provided, in an Officers’ Certificate, or established in one or more indentures supplemental
hereto, prior to the issuance of Securities of any series:




               (1) the title of the Securities of the series, including CUSIP Numbers (which shall
distinguish the Securities of the series from Securities of any other series);



               (2) any limit upon the aggregate principal amount of the Securities of the series which may be
authenticated and delivered under this Indenture (except for Securities authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series
pursuant to Section 3.04, 3.05, 3.06, 9.06 or 11.07 and except for any Securities which, pursuant
to Section 3.03, are deemed never to have been authenticated and delivered hereunder);



               (3) the Person to whom any interest on a Security of the series shall be payable, if other
than the Person in whose name that Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest;



               (4) the date or dates on which the principal of the Securities of the series is payable;



               (5) the rate or rates at which the Securities of the series shall bear interest, if any, the
date or dates from which such interest shall accrue, the Interest Payment Dates on which any such
interest shall be payable and the Regular Record Date for any interest payable on any Interest
Payment Date;



               (6) the place or places where the principal of and any premium and interest on Securities of
the series shall be payable;



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               (7) the period or periods within which, the price or prices at which and the terms and
conditions upon which Securities of the series may be redeemed, in whole or in part, at the option
of the Company;



               (8) the obligation, if any, of the Company to redeem or purchase Securities of the series
pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the
period or periods within which, the price or prices at which and the terms and conditions upon
which Securities of the series shall be redeemed or purchased, in whole or in part, pursuant to
such obligation;



               (9) if other than denominations of $1,000 and any integral multiple thereof, the denominations
in which Securities of the series shall be issuable;



               (10) the currency, currencies or currency units in which payment of the principal of and any
premium and interest on any Securities of the series shall be payable if other than the currency of
the United States of America and the manner of determining the equivalent thereof in the currency
of the United States of America for purposes of the definition of “Outstanding” in Section 1.01;



               (11) if the amount of payments of principal of or any premium or interest on any Securities of
the series may be determined with reference to an index, the manner in which such amounts shall be
determined;



               (12) if the principal of or any premium or interest on any Securities of the series is to be
payable, at the election of the Company or a Holder thereof, in one or more currencies or currency
units other than that or those in which the Securities are stated to be payable, the currency,
currencies or currency units in which payment of the principal of and any premium and interest on
Securities of such series as to which such election is made shall be payable, and the periods
within which and the terms and conditions upon which such election is to be made;



               (13) if other than the principal amount thereof, the portion of the principal amount of
Securities of the series which shall be payable upon declaration of acceleration of the Maturity
thereof pursuant to Section 5.02;



               (14) if and as applicable, that the Securities of the series shall be issuable in whole or in
part in the form of one or more Global Securities and, in such case, the Depositary or Depositaries
for such Global Security or Global Securities and any circumstances other than those set forth in
Section 3.05 in which any such Global Security may be transferred to, and registered and exchanged
for Securities registered in the name of, a Person other than the Depositary for such Global
Security or a nominee thereof and in which any such transfer may be registered;



               (15) the terms and conditions, if any, pursuant to which the Securities are convertible into
Common Stock of the Company pursuant to Article XIII, and any variation thereof;



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               (16) the terms and conditions, if any, pursuant to which the Securities are convertible into
or exchangeable for any other securities; and



               (17) any addition to or change in the covenants set forth in Article X which applies to
Securities of the series; and



               (18) any other terms of the series (which terms shall not be inconsistent with the provisions
of this Indenture, except as permitted by Section 9.01(5)) and any deletions from or modifications
or additions to this Indenture or the form of the Securities in respect of such series.



          All Securities of any one series shall be substantially identical except as to denomination
and except as may otherwise be provided in or pursuant to the Board Resolution referred to above
and (subject to Section 3.03) set forth, or determined in the manner provided, in the Officers’
Certificate referred to above or in any such indenture supplemental hereto.




          If any of the terms of the series are established by action taken pursuant to a Board
Resolution, a copy of an appropriate record of such action shall be certified by the Secretary or
an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of
the Officers’ Certificate setting forth the terms of the series.




          The Company may, from time to time, by adoption of a Board Resolution and subject to
compliance with any other applicable provisions of this Indenture, without the consent of the
Holders, create and issue pursuant to this Indenture additional securities of any series of
Securities (“Add On Securities”) having terms and conditions identical to those of such series of
Outstanding Securities, except that such Add On Securities:




                    (i) may have a different issue date from such series of Outstanding Securities;



                    (ii) may have a different amount of interest payable on the first Interest Payment Date after
issuance than is payable on such series of Outstanding Securities; and



                    (iii) may have terms specified in such Board Resolution for such Add On Securities making
appropriate adjustments to this Article III applicable to such Add On Securities in order to
conform to and ensure compliance with the Securities Act (or applicable securities laws) which are
not adverse in any material respect to the Holder of any Outstanding Securities (other than such
Add On Securities) and which shall not affect the rights or duties of the Trustee.



     Section 3.02 Denominations.



          The Securities of each series shall be issuable only in registered form without coupons in
such denominations as shall be specified as contemplated by Section 3.01. In the absence of any
such specified denomination with respect to the Securities of any series, the Securities of such
series shall be issuable in denominations of $1,000 and any integral multiple thereof.




     Section 3.03 Execution, Authentication, Delivery and Dating.



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          The Securities shall be executed on behalf of the Company by its Chairman of the Board, its
Vice Chairman of the Board, its President, one of its Vice Presidents or its Treasurer under its
corporate seal reproduced thereon attested by its Secretary or one of its Assistant Secretaries or
by its Chief Financial Officer. The signature of any of these officers on the Securities may be
manual or facsimile.




          Securities bearing the manual or facsimile signatures of individuals who were at any time the
proper officers of the Company shall bind the Company, notwithstanding that such individuals or any
of them have ceased to hold such offices prior to the authentication and delivery of such
Securities or did not hold such offices at the date of such Securities.




          At any time and from time to time after the execution and delivery of this Indenture, the
Company may deliver Securities of any Series executed by the Company to the Trustee for
authentication, together with a Company Order for the authentication and delivery of such
Securities, and the Trustee in accordance with the Company Order shall authenticate and deliver
such Securities. In authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be provided with, and
(subject to Section 6.01) shall be fully protected in relying upon, an Opinion of Counsel stating:




               (1) if the form of such Securities has been established by or pursuant to Board Resolution as
permitted by Section 2.01, that such form has been established in conformity with the provisions of
this Indenture;



               (2) if the terms of such Securities have been established by or pursuant to Board Resolution
as permitted by Section 3.01, that such terms have been established in conformity with the
provisions of this Indenture; and



               (3) that such Securities, when authenticated and delivered by the Trustee and issued by the
Company in the manner and subject to any conditions specified in such Opinion of Counsel, will
constitute valid and legally binding obligations of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’ rights and to general
equity principles.


If such form or terms have been so established, the Trustee shall not be required to authenticate
such Securities if the issue of such Securities pursuant to this Indenture will affect the
Trustee’s own rights, duties or immunities under the Securities and this Indenture or otherwise in
a manner which is not reasonably acceptable to the Trustee.




          Each Security shall be dated the date of its authentication.




          No Security shall be entitled to any benefit under this Indenture or be valid or obligatory
for any purpose unless there appears on such Security a certificate of authentication substantially
in the form provided for herein executed by the Trustee by manual signature, and such certificate
upon any Security shall be conclusive evidence, and the only evidence, that such Security has been
duly authenticated and delivered hereunder. Notwithstanding the foregoing, if any Security shall
have been authenticated and delivered hereunder but never issued and sold by the Company, and the
Company shall deliver such Security to the Trustee for cancellation as



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provided in Section 3.09, for all purposes of this Indenture such Security shall be deemed
never to have been authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.




     Section 3.04 Temporary Securities.



          Pending the preparation of definitive Securities of any series, the Company may execute, and
upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as evidenced by their execution of such
Securities.




          If temporary Securities of any series are issued, the Company will cause definitive Securities
of that series to be prepared without unreasonable delay. After the preparation of definitive
Securities of such series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series upon surrender of the temporary Securities of such series at
the office or agency of the Company in a Place of Payment for that series, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Securities of any series the
Company shall execute and the Trustee shall authenticate and deliver in exchange therefor one or
more definitive Securities of the same series, of any authorized denominations and of a like
aggregate principal amount and tenor. Until so exchanged the temporary Securities of any series
shall in all respects be entitled to the same benefits under this Indenture as definitive
Securities of such series and tenor.




     Section 3.05 Registration, Registration of Transfer and Exchange.



          The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register
(the register maintained in such office and in any other office or agency of the Company in a Place
of Payment being herein sometimes collectively referred to as the “Security Register”) in which,
subject to such reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby appointed
“Security Registrar” for the purpose of registering Securities and transfers of Securities as
herein provided.




          Upon surrender for registration of transfer of any Security of any series at the office or
agency in a Place of Payment for that series, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or transferees, one or more new
Securities of the same series, of any authorized denominations and of a like aggregate principal
amount and tenor.




          At the option of the Holder, Securities of any series may be exchanged for other Securities of
the same series, of any authorized denominations and of a like aggregate principal amount and
tenor, upon surrender of the Securities to be exchanged at such office or agency.




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          Whenever any Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.




          All Securities issued upon any registration of transfer or exchange of Securities shall be the
valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Securities surrendered upon such registration of transfer or exchange.




          Every Security presented or surrendered for registration of transfer or for exchange shall (if
so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.




          No service charge shall be made for any registration of transfer or exchange of Securities,
but the Company or Security Registrar may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section 3.04, 9.06 or 11.07 not involving
any transfer.




          The Company shall not be required (1) to issue, register the transfer of or exchange
Securities of any series during a period beginning at the opening of business 15 days before the
day of the mailing of a notice of redemption of Securities of that series selected for redemption
under Section 11.03 and ending at the close of business on the day of such mailing, or (2) to
register the transfer of or exchange any Security so selected for redemption in whole or in part,
except the unredeemed portion of any Security being redeemed in part.




          Notwithstanding any other provision in this Indenture, no Global Security may be transferred
to, or registered or exchanged for Securities registered in the name of, any Person other than the
Depositary for such Global Security or any nominee thereof, and no such transfer may be registered,
unless (1) such Depositary (A) notifies the Company that it is unwilling or unable to continue as
Depositary for such Global Security or (B) has ceased to be a clearing agency registered under the
Exchange Act, (2) the Company executes and delivers to the Trustee a Company Order that such Global
Security shall be so transferable, registrable and exchangeable, and such transfers shall be
registrable, (3) there shall have occurred and be continuing an Event of Default with respect to
the Securities evidenced by such Global Security or (4) there shall exist such other circumstances,
if any, as have been specified for this purpose as contemplated by Section 3.01. Notwithstanding
any other provision in this Indenture, a Global Security to which the restriction set forth in the
preceding sentence shall have ceased to apply may be transferred only to, and may be registered and
exchanged for Securities registered only in the name or names of, such Person or Persons as the
Depositary for such Global Security shall have directed and no transfer thereof other than such a
transfer may be registered.




          Every Security authenticated and delivered upon registration of transfer of, or in exchange
for or in lieu of, a Global Security to which the restriction set forth in the first sentence of
the preceding paragraph shall apply, whether pursuant to this Section, Section 3.04, 3.06, 9.06 or
11.07 or otherwise, shall be authenticated and delivered in the form of, and shall be, a Global
Security.




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     Section 3.06 Mutilated, Destroyed, Lost and Stolen Securities.



          If any mutilated Security is surrendered to the Trustee, the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and
of like tenor and principal amount and bearing a number not contemporaneously outstanding.




          If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction
of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be
required by them to save each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any
such destroyed, lost or stolen Security, a new Security of the same series and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.




          In case any such mutilated, destroyed, lost or stolen Security has become or is about to
become due and payable, the Company in its discretion may, instead of issuing a new Security, pay
such Security.




          Upon the issuance of any new Security under this Section, the Company may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee) connected
therewith.




          Every new Security of any series issued pursuant to this Section in exchange for any mutilated
Security or in lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other Securities of that
series duly issued hereunder.




          The provisions of this Section are exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost
or stolen Securities.




     Section 3.07 Payment of Interest; Interest Rights Preserved.



          Except as otherwise provided as contemplated by Section 3.01 with respect to any series of
Securities, interest on any Security which is payable, and is punctually paid or duly provided for,
on any Interest Payment Date shall be paid to the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the Regular Record Date for
such interest.




          Any interest on any Security of any series which is payable, but is not punctually paid or
duly provided for, on any Interest Payment Date (herein called “Defaulted Interest”) shall
forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:




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               (1) The Company may elect to make payment of any Defaulted Interest to the Persons in whose
names the Securities of such series (or their respective Predecessor Securities) are registered at
the close of business on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Security of such series and the date of
the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder of Securities of such series at
his address as it appears in the Security Register, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (or their respective Predecessor Securities) are registered at the
close of business on such Special Record Date and shall no longer be payable pursuant to the
following Clause (2).



               (2) The Company may make payment of any Defaulted Interest on the Securities of any series in
any other lawful manner not inconsistent with the requirements of any securities exchange on which
such Securities may be listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Trustee.



          Subject to the foregoing provisions of this Section, each Security delivered under this
Indenture upon registration of transfer of or in exchange for or in lieu of any other Security
shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such
other Security.




          Subject to the provisions of Section 13.02, in the case of any Security which is converted
after any Regular Record Date and on or prior to the next succeeding Interest Payment Date,
interest whose Stated Maturity is on such Interest Payment Date shall be payable on such Interest
Payment Date notwithstanding such conversion, and such interest (whether or not punctually paid or
duly provided for) shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on such Regular Record Date. Except
as otherwise expressly provided in the immediately preceding sentence, in the case of any Security
which is converted, interest whose Stated Maturity is after the date of conversion of such Security
shall not be payable.




     Section 3.08 Persons Deemed Owners.



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          Prior to due presentment of a Security for registration of transfer, the Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment of principal of and
any premium and (subject to Section 3.07) any interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice to the contrary.




     Section 3.09 Cancellation.



          All Securities surrendered for payment, redemption, registration of transfer or exchange or
conversion or for credit against any sinking fund payment shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner whatsoever, and may deliver
to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Securities
previously authenticated hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of by
the Trustee in its customary manner.




     Section 3.10 Computation of Interest.



          Except as otherwise specified as contemplated by Section 3.01 for Securities of any series,
interest on the Securities of each series shall be computed on the basis of a 360-day year of
twelve 30-day months.




     Section 3.11 CUSIP Numbers.



          The Company in issuing the Securities may use “CUSIP” numbers (if then generally in use), and,
if so, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on the Securities, and
any such redemption shall not be affected by any defect in or omission of such numbers. The
Company will promptly notify the Trustee of any changes in the “CUSIP” numbers.




ARTICLE IV




SATISFACTION AND DISCHARGE




     Section 4.01 Satisfaction and Discharge of Indenture.



          This Indenture shall upon Company Request cease to be of further effect (except as to any
surviving rights of conversion, registration of transfer or exchange of Securities herein



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expressly provided for), and the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when either:





          (1) all Securities theretofore authenticated and delivered (other than (i) Securities
which have been destroyed, lost or stolen and which have been replaced or paid as provided
in Section 3.06 and (ii) Securities for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Company and thereafter repaid to the Company
or discharged from such trust) have been delivered to the Trustee for cancellation; or




          (2) all such Securities not theretofore delivered to the Trustee for cancellation



                    (i) have become due and payable, or



                    (ii) will become due and payable at their Stated Maturity within one year, or



                    (iii) are to be called for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of
the Company,


and the Company, in the case of (i), (ii) or (iii) above, has deposited or caused to be deposited
with the Trustee as trust funds in trust for the purpose an amount sufficient to pay and discharge
the entire indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of such deposit (in the case
of Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as
the case may be;




               (3) the Company has paid or caused to be paid all other sums payable hereunder by the Company;
and



               (4) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.



     Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the
Company to the Trustee under Section 6.07, and, if money shall have been deposited with the Trustee
pursuant to subclause (ii) of Clause (1) of this Section, the obligations of the Trustee under
Section 4.02 shall survive such satisfaction and discharge.



   Section 4.02 Application of Trust Money.



          All money deposited with the Trustee pursuant to Section 4.01 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal and
any premium and interest for whose payment such money has been deposited with the Trustee. All
money deposited with the Trustee pursuant to Section 4.01 (and held by it or any Paying



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Agent) for payment of Securities of a series that is convertible in accordance with Article
XIII and that are subsequently converted, shall be returned to the Company.




ARTICLE V




REMEDIES




     Section 5.01 Events of Default.



          “Event of Default”, wherever used herein with respect to Securities of any series, means any
one of the following events (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any administrative or governmental body):




               (1) default in the payment of any interest upon any Security of that series when it becomes
due and payable, and continuance of such default for a period of 30 days; or



               (2) default in the payment of the principal of (or premium, if any, on) any Security of that
series at its Maturity; or



               (3) default in the deposit of any sinking fund payment, when and as due by the terms of a
Security of that series, and continuance of such default for a period of 30 days; or



               (4) default in the performance, or breach, of any covenant or warranty of the Company in this
Indenture (other than a covenant or warranty a default in whose performance or whose breach is
elsewhere in this Section specifically dealt with or which has expressly been included in this
Indenture solely for the benefit of series of Securities other than that series), and continuance
of such default or breach for a period of 90 days after there has been given, by registered or
certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of
at least 25% in principal amount of the Outstanding Securities of that series a written notice
specifying such default or breach and requiring it to be remedied and stating that such notice is a
“Notice of Default” hereunder; or



               (5) the Company shall fail to pay any Indebtedness in excess of $10,000,000 owing by the
Company, or any interest or premium thereon, when due (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument relating to such
Indebtedness, or the Company shall fail to perform any term, covenant or agreement on its part to
be performed under any agreement or instrument evidencing or securing or relating to any such
Indebtedness, if the effect of such failure in either case is that the maturity of such
Indebtedness is duly accelerated, without such Indebtedness having been discharged or such
acceleration having been rescinded or annulled, in each such case, within a period of 10 days after
there shall have been given, by registered or certified mail, to the Company by the Trustee or to
the Company and the Trustee by Holders of at least 25% in principal amount of the Outstanding
Securities of that series, a written notice specifying such default and requiring the Company to
cause such Indebtedness to be discharged or cause such acceleration to be rescinded or annulled, as
the case may be, and stating that such notice is a “Notice of Default” hereunder



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(the Trustee shall not be deemed to have knowledge of a default under this subsection (5)
unless it shall have actual knowledge thereof); provided, however, that, subject to the provisions
of Sections 6.01 and 6.05, the Trustee shall not be deemed to have knowledge of such failure to pay
unless either (A) a Responsible Officer of the Trustee shall have actual knowledge of such failure
to pay or (B) the Trustee shall have received written notice thereof from the Company, from any
Holder, from the holder of any such Indebtedness or from the trustee thereunder; or




               (6) the entry by a court having jurisdiction in the premises of (A) a decree or order for
relief in respect of the Company in an involuntary case or proceeding under any applicable Federal
or State bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order
adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of the Company under any
applicable Federal or State law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and the continuance of any such
decree or order for relief or any such other decree or order unstayed and in effect for a period of
60 consecutive days; or



               (7) the commencement by the Company of a voluntary case or proceeding under any applicable
Federal or State bankruptcy, insolvency, reorganization or other similar law or of any other case
or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a
decree or order for relief in respect of the Company in an involuntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of
a petition or answer or consent seeking reorganization or relief under any applicable Federal or
State law, or the consent by it to the filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in writing of its inability to pay
its debts generally as they become due, or the taking of corporate action by the Company in
furtherance of any such action; or



               (8) any other Event of Default provided with respect to Securities of that series.



     Section 5.02 Acceleration of Maturity; Rescission and Annulment.



          If an Event of Default with respect to Securities of any series at the time Outstanding occurs
and is continuing, then in every such case the Trustee or the Holders of not less than 25% in
principal amount of the Outstanding Securities of that series may declare the principal amount (or,
if any of the Securities of that series are Original Issue Discount Securities, such portion of the
principal amount of such Securities as may be specified in the terms thereof) of all of the
Securities of that series to be due and payable immediately, by a notice in writing to the Company
(and to the Trustee if given by Holders), and upon any such declaration such principal amount (or
specified amount) shall become immediately due and payable.




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          At any time after such a declaration of acceleration with respect to Securities of any series
has been made and before a judgment or decree for payment of the money due has been obtained by the
Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of
the Outstanding Securities of that series, by written notice to the Company and the Trustee, may
rescind and annul such declaration and its consequences if:




               (1) the Company has paid or deposited with the Trustee a sum sufficient to pay:



                    (i) all overdue interest on all Securities of that series,



                    (ii) the principal of (and premium, if any, on) any Securities of that series which have
become due otherwise than by such declaration of acceleration and any interest thereon at the rate
or rates prescribed therefor in such Securities,



                    (iii) to the extent that payment of such interest is lawful, interest upon overdue interest at
the rate or rates prescribed therefor in such Securities, and



                    (iv) all sums paid or advanced by the Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel; and



               (2) all Events of Default with respect to Securities of that series, other than the
non-payment of the principal of Securities of that series which have become due solely by such
declaration of acceleration, have been cured or waived as provided in Section 5.13.


No such rescission shall affect any subsequent default or impair any right consequent thereon.




     Section 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee.



          The Company covenants that if:




               (1) default is made in the payment of any interest on any Security when such interest becomes
due and payable and such default continues for a period of 30 days; or



               (2) default is made in the payment of the principal of (or premium, if any, on) any Security
at the Maturity thereof, the Company will, upon demand of the Trustee, pay to it, for the benefit
of the Holders of such Securities, the whole amount then due and payable on such Securities for
principal and any premium and interest and, to the extent that payment of such interest shall be
legally enforceable, interest on any overdue principal and premium and on any overdue interest, at
the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and
counsel.



          If an Event of Default with respect to Securities of any series occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities of such series by such appropriate judicial proceedings as the Trustee shall



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deem necessary to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein,
or to enforce any other proper remedy.




     Section 5.04 Trustee May File Proofs of Claim.



          In case of any judicial proceeding relative to the Company (or any other obligor upon the
Securities), its property or its creditors, the Trustee shall be entitled and empowered, by
intervention in such proceeding or otherwise, to take any and all actions authorized under the
Trust Indenture Act in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on 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 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 6.07.




          No provision of this Indenture shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding;
provided, however, that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors’ or other similar
committee.




     Section 5.05 Trustee May Enforce Claims Without Possession of Securities.



          All rights of action and claims under this Indenture or the Securities may be prosecuted and
enforced by the Trustee without the possession of any of the Securities or the production thereof
in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in
respect of which such judgment has been recovered.




     Section 5.06 Application of Money Collected.



          Any money collected by the Trustee pursuant to this Article shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on
account of principal or any premium or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:





          FIRST: To the payment of all amounts due the Trustee under Section 6.07;



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          SECOND: To the payment of the amounts then due and unpaid for principal of and any
premium and interest on the Securities 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 Securities for principal and any premium and interest,
respectively; and




          THIRD: To the Company.



     Section 5.07 Limitation on Suits.



          No Holder of any Security of any series shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or
trustee, or for any other remedy hereunder, unless




               (1) such Holder has previously given written notice to the Trustee of a continuing Event of
Default with respect to the Securities of that series;



               (2) the Holders of not less than 25% in principal amount of the Outstanding Securities of that
series shall have made written request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;



               (3) such Holder or Holders have offered to the Trustee reasonable indemnity satisfactory to it
against the costs, expenses and liabilities to be incurred in compliance with such request;



               (4) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity
has failed to institute any such proceeding; and



               (5) no direction inconsistent with such written request has been given to the Trustee during
such 60-day period by the Holders of a majority in principal amount of the Outstanding Securities
of that series; it being understood and intended that no one or more of such Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable benefit of all of
such Holders.



     Section 5.08 Unconditional Right of Holders to Receive Principal, Premium and Interest and
to Convert.



          Notwithstanding any other provision in this Indenture, the Holder of any Security shall have
the right, which is absolute and unconditional, to receive payment of the principal of and any
premium and (subject to Section 3.07) interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption, on the Redemption Date) and to convert
such Security in accordance with Article XIII and to institute suit for the enforcement of any such
payment and right to convert, and such rights shall not be impaired without the consent of such
Holder.




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     Section 5.09 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 Trustee and the Holders shall continue as though no such proceeding had been
instituted.




     Section 5.10 Rights and Remedies Cumulative.



          Except as otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in the last paragraph of Section 3.06, 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 5.11 Delay or Omission Not Waiver.



          No delay or omission of the Trustee or of any Holder of any Securities 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 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.




     Section 5.12 Control by Holders.



          The Holders of a majority in principal amount of the Outstanding Securities of any series
shall have the right to 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, with
respect to the Securities of such series, provided that




               (1) such direction shall not be in conflict with any rule of law or with this Indenture,



               (2) the Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction, and



               (3) subject to the provisions of Section 6.01, the Trustee shall have the right to decline to
follow any such direction if the Trustee in good faith share, by a Responsible Officer or Officers
of the Trustee, determine, and the Trustee shall have received a legal opinion stating, that the
proceedings so directed would involve the Trustee in personal liability.



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     Section 5.13 Waiver of Past Defaults.



          The Holders of not less than a majority in principal amount of the Outstanding Securities of
any series may on behalf of the Holders of all the Securities of such series waive any past default
hereunder with respect to such series and its consequences, except a default




               (1) in the payment of the principal of or any premium or interest on any Security of such
series, or



               (2) in respect of a covenant or provision hereof which under Article IX cannot be modified or
amended without the consent of the Holder of each Outstanding Security of such series 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 impair any right consequent thereon.




     Section 5.14 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, suffered 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 such suit, and may
assess costs, including legal fees and expenses, against any such party litigant, in the manner and
to the extent provided in the Trust Indenture Act; provided that neither this Section nor the Trust
Indenture Act shall apply to any suit instituted by the Trustee, to any suit instituted by any
Holders of the Securities, or group of Holders of the Securities, holding in the aggregate more
than 10% of principal amount of the Outstanding Securities of any series, or to any suit instituted
by any Holder of the Outstanding Securities for the enforcement of the payment of principal of or
interest on any Outstanding Securities held by such Holder, on or after the respective due dates
expressed in such Outstanding Securities, and provided, further, that neither this Section nor the
Trust Indenture Act shall be deemed to authorize any court to require such an undertaking or to
make such an assessment in any suit instituted by the Company or, if applicable, in any suit for
the enforcement of the right to convert any Security in accordance with Article XIII.




     Section 5.15 Waiver of Usury, Stay or Extension 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
usury, stay or extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to the extent that it
may lawfully do so) 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.





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ARTICLE VI




THE TRUSTEE




          The Trustee hereby accepts the trust imposed upon it by this Indenture and covenants and
agrees to perform the same, as herein expressed.




     Section 6.01 Duties of Trustee.



               (1) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent person would exercise or use under the circumstances in the conduct of
his own affairs.



               (2) Except during the continuance of an Event of Default:



                    (i) The Trustee need perform only those duties as are specifically set forth in this Indenture
and no others, and no covenants or obligations shall be implied in or read into this Indenture.



                    (ii) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of this Indenture. However,
in the case of any such certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they substantially conform to the requirements of this Indenture (but need
not confirm or investigate the accuracy of mathematical calculations or other facts stated
therein).



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



                    (i) This paragraph does not limit the effect of paragraph (2) of this Section 6.01.



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



                    (iii) The Trustee shall not be liable with respect to any action it takes or omits to take in
good faith in accordance with a direction received by it pursuant to Section 5.12.



               (4) No provision of this Indenture shall require the Trustee to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its duties hereunder or to
take or omit to take any action under this Indenture.



               (5) Every provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (1), (2), (3), (4) and (6) of this Section 6.01.



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               (6) The Trustee shall not be liable for interest on any assets received by it except as the
Trustee may agree in writing with the Company. Assets held in trust by the Trustee need not be
segregated from other assets except to the extent required by law.



     Section 6.02 Rights of Trustee.



          Subject to Section 6.01:




               (1) The Trustee may conclusively rely on any document (whether in its original or facsimile
form) believed by it to be genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in any document.



               (2) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate
or an Opinion of Counsel. 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.



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



               (4) The Trustee shall not be liable for any action it takes or omits to take in good faith
which it believes to be authorized or within its rights or powers.



               (5) The Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, notice, request, direction,
consent, order, bond, debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as it may see fit and, if
the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent or attorney at the
sole cost of the Company and shall incur no liability or additional liability of any kind by reason
of such investigation.



               (6) The Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request, order or direction of any of the Holders, pursuant to the
provisions of this Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity satisfactory to it against the costs, expenses and liabilities which may be
incurred therein or thereby.



               (7) 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 of any action taken,
suffered or omitted by in hereunder in good faith and in reliance thereon.



               (8) the Trustee shall not be deemed to have notice of any 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 Securities and this Indenture.



               (9) 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



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enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and
other Person employed to act hereunder.



               (10) in no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit)
irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.



     Section 6.03 Individual Rights of Trustee.



          The Trustee in its individual or any other capacity may become the owner or pledgee of
Securities and may otherwise deal with the Company, its Subsidiaries, or their respective
Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent or Security
Registrar may do the same with like rights. However, the Trustee must comply with Sections 6.08,
6.09 and 6.10.




     Section 6.04 Trustee’s Disclaimer.



          The Trustee makes no representation as to the validity or adequacy of this Indenture or the
Securities and it shall not be accountable for the Company’s use of the proceeds from the
Securities, and it shall not be responsible for any statement in the Securities, other than the
Trustee’s certificate of authentication, or the use or application of any funds received by a
Paying Agent other than the Trustee.




     Section 6.05 Notice of Default.



          If an Event of Default with respect to Securities of any series occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to each Holder of Securities of such series
notice of the uncured Event of Default within 90 days after such Event of Default occurs. Except
in the case of an Event of Default in payment of principal (or premium, if any) of, or interest on,
any Security, the Trustee may withhold the notice if and so long as a Responsible Officer in good
faith determines that withholding the notice is in the interest of the Holders of Securities of
such series.




     Section 6.06 Reports by Trustee to Holders.



          Within 60 days after each February 15 beginning with the February 15 following the date of
this Indenture, the Trustee shall mail to each Holder a brief report dated as of such February 15
that complies with Trust Indenture Act Section 313(a) if such report is required by such Trust
Indenture Act Section 313(a). The Trustee also shall comply with Trust Indenture Act Sections
313(b) and 313(c).




          The Company shall promptly notify the Trustee in writing if the Securities of any series
become listed on any stock exchange or automatic quotation system.




          A copy of each report at the time of its mailing to Holders shall be mailed to the Company and
filed with the Commission and each stock exchange, if any, on which the Securities are listed.




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     Section 6.07 Compensation and Indemnity.



          The Company shall pay to the Trustee from time to time such compensation for its services as
the Company and the Trustee shall from time to time agree in writing. The Trustee’s compensation
shall not be limited by any law on compensation of a trustee of an express trust. The Company
shall reimburse the Trustee upon request for all disbursements, expenses and advances incurred or
made by it. Such expenses shall include the reasonable compensation, disbursements and expenses of
the Trustee’s agents, accountants, experts and counsel.




          The Company shall indemnify each of the Trustee (in its capacity as Trustee) and any
predecessor Trustee and each of their respective officers, directors, attorneys-in-fact and agents
for, and hold it harmless against, any claim, demand, expense (including but not limited to
reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel), loss,
charges (including taxes (other than taxes based upon the income of the Trustee)) or liability
incurred by them, arising out of or in connection with the acceptance or administration of this
trust and their rights or duties hereunder including the reasonable costs and expenses of defending
themselves against any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim
asserted against the Trustee for which it may seek indemnity and of which a Responsible Officer has
received written notice. The Company shall defend the claim and the Trustee shall provide
reasonable cooperation at the Company’s expense in the defense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its written consent which consent shall not be
unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss or
liability to the extent incurred by the Trustee as determined by a court of competent jurisdiction
to have been caused by its own negligence or willful misconduct.




          To secure the Company’s payment obligations in this Section 6.07, the Trustee shall have a
lien prior to the Securities on all assets held or collected by the Trustee, in its capacity as
Trustee, except assets held in trust to pay principal and premium, if any, of or interest on
particular Securities.




          When the Trustee incurs expenses or renders services after an Event of Default specified in
Section 5.01(6) or (7) occurs, the expenses and the compensation for the services are intended to
constitute expenses of administration under any Bankruptcy Law.




          The Company’s obligations under this Section 6.07 and any lien arising hereunder shall survive
the resignation or removal of the Trustee, the discharge of the Company’s obligations pursuant to
Article IV of this Indenture and any rejection or termination of this Indenture under any
Bankruptcy Law.




     Section 6.08 Replacement of Trustee.



          The Trustee may resign at any time with respect to the Securities of one or more series by so
notifying the Company in writing. The Holder or Holders of a majority in principal amount of the
outstanding Securities of a series may remove the Trustee with respect to Securities of such



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series by so notifying the Company and the Trustee in writing and may appoint a successor
trustee with respect to Securities of such series with the Company’s consent. The Company may
remove the Trustee if:



               (1) the Trustee fails to comply with Section 6.10;



               (2) the Trustee is adjudged bankrupt or insolvent;



               (3) a receiver, custodian, or other public officer takes charge of the Trustee or its
property; or



               (4) the Trustee becomes incapable of acting.



          If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee, with
respect to the Securities of one or more series, for any reason, the Company shall promptly appoint
a successor Trustee, with respect to Securities of that or those series. Within one year after the
successor Trustee with respect to a series of Securities takes office, the Holder or Holders of a
majority in principal amount of the Securities of such series may appoint a successor Trustee with
respect to such series to replace the successor Trustee appointed by the Company.




          A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Company. Immediately after that and provided that all sums owing to the Trustee
provided for in Section 6.07 have been paid, the retiring Trustee shall transfer all property held
by it as Trustee with respect to such series of Securities to the successor Trustee, subject to the
lien provided in Section 6.07, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. A successor Trustee with respect to one or more series of Securities shall
mail notice of its succession to each Holder of Securities of that or those series.




          If a successor Trustee with respect to a series of Securities does not take office within 60
days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holder or Holders of at least 10% in principal amount of the outstanding Securities of that series
may petition at the expense of the Company any court of competent jurisdiction for the appointment
of a successor Trustee with respect to such series.




          If the Trustee fails to comply with Section 6.10, any Holder of Securities of a series may
petition any court of competent jurisdiction for the removal of the Trustee with respect to such
series and the appointment of a successor Trustee with respect to such series.




          Notwithstanding replacement of the Trustee pursuant to this Section 6.08, the Company’s
obligations under Section 6.07 shall continue for the benefit of the retiring Trustee.




     Section 6.09 Successor Trustee by Merger, Etc.



          If the Trustee consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation, the resulting, surviving or transferee



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corporation without any further act shall, if such resulting, surviving or transferee
corporation is otherwise eligible hereunder, be the successor Trustee.


     Section 6.10 Eligibility; Disqualification.


          The Trustee shall at all times satisfy the requirements of Trust Indenture Act Section
310(a)(1) and Trust Indenture Act Section 310(a)(5).


          The Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in
its most recent published annual report of condition. The Trustee shall comply with Trust
Indenture Act Section 310(b); provided, however, that there shall be excluded from the operation of
such Section 310(b) the Indenture dated as of March 12, 2002, between the Company and The Bank of
New York Mellon pertaining to the Company’s Senior Securities, the Indenture dated as of August 18,
1997, between the Company and The Bank of New York Mellon pertaining to the Company’s 7% Senior
Notes due 2007 and the Indenture dated as of April 28, 1994, between the Company and The Bank of
New York Mellon pertaining to the Company’s 8 7/8% Senior Notes due 2004.


     Section 6.11 Preferential Collection of Claims against Company.


          The Trustee shall comply with Trust Indenture Act Section 311(a), excluding any creditor
relationship listed in Trust Indenture Act Section 311(b). A Trustee who has resigned or been
removed shall be subject to Trust Indenture Act Section 311(a) to the extent indicated.


ARTICLE VII


HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY


     Section 7.01 Company to Furnish Trustee Names and Addresses of Holders.


          The Company will furnish or cause to be furnished to the Trustee:


               (1) semi-annually, not more than 15 days after each Regular Record Date, a list for each
series of Securities, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of such series as of the Regular Record Date, as the case
may be, and


               (2) at such other times as the Trustee may request in writing, within 30 days after the
receipt by the Company of any such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished; excluding from any such list names and
addresses received by the Trustee in its capacity as Security Registrar.


     Section 7.02 Preservation of Information; Communications to Holders.


          The Trustee shall preserve, in as current a form as is reasonably practicable, the names and
addresses of Holders contained in the most recent list furnished to the Trustee as provided in
Section 7.01 and the names and addresses of Holders received by the Trustee in its capacity as


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Security Registrar. The Trustee may destroy any list furnished to it as provided in Section
7.01 upon receipt of a new list so furnished.



          The rights of the Holders to communicate with other Holders with respect to their rights under
this Indenture or under the Securities, and the corresponding rights and privileges of the Trustee,
shall be as provided by the Trust Indenture Act.




          Every Holder of Securities, by receiving and holding the same, agrees with the Company and the
Trustee that neither the Company nor the Trustee nor any agent of either of them shall be held
accountable by reason of any disclosure of information as to names and addresses of Holders made
pursuant to the Trust Indenture Act.




     Section 7.03 Reports by Trustee.



          The Trustee shall transmit to Holders such reports concerning the Trustee and its actions
under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant thereto.




          A copy of each such report shall, at the time of such transmission to Holders, be filed by the
Trustee with each stock exchange upon which any Securities are listed, with the Commission and with
the Company. The Company will notify the Trustee when any Securities are listed on any stock
exchange or delisted therefrom.




     Section 7.04 Reports by Company.



          The Company shall file with the Trustee and the Commission, and transmit to Holders, such
information, documents and other reports, and such summaries thereof, as may be required pursuant
to the Trust Indenture Act at the times and in the manner provided pursuant to such Act; provided
that any such information, documents or reports required to be filed with the Commission pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be filed with the Trustee
within 15 days after the same is so required to be filed with the Commission. 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
Officer’s Certificates.)




ARTICLE VIII




CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE




     Section 8.01 When Company May Merge, Etc.



          The Company may not, in a single transaction or through a series of related transactions,
consolidate with or merge with or into any other person, or, directly or indirectly, sell, lease,
assign, transfer or convey its properties and assets as an entirety or substantially as an entirety
(computed on a consolidated basis) to another person or group of affiliated persons, and another
person or group of affiliated persons may not directly or indirectly sell, lease, assign, transfer
or



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convey its properties and assets as an entity or substantially as an entity (computed on a
consolidated basis) to the Company, unless:



               (1) 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 to which all or substantially
all of the properties and assets of the Company are transferred as an entirety or substantially as
an entirety (the Company or such other person being hereinafter referred to as the “Surviving
Person”), shall be a corporation organized and validly existing under the laws of the United
States, any State thereof or the District of Columbia, and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form and substance satisfactory to
the Trustee, all the obligations of the Company under the Securities and this Indenture and the
Indenture, so supplemented, shall remain in full force and effect;



               (2) immediately after giving effect to such transaction and the assumption of the obligations
as set forth in clause (1), above, no Event of Default shall have occurred and be continuing; and



               (3) if a supplemental indenture is required in connection with such transaction, the Company
has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, assignment, or transfer and such supplemental indenture comply with
this Article VIII and that all conditions precedent herein provided relating to such transaction
have been satisfied.



     Section 8.02 Successor Corporation Substituted.



          Upon any consolidation or merger, or any transfer of assets in accordance with Section 8.01,
the Surviving Person formed by such consolidation or into which the Company is merged or to which
such transfer 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 Surviving Person had
been named as the Company herein. When a Surviving Person duly assumes all of the obligations of
the Company pursuant hereto and pursuant to the Securities, the predecessor shall be relieved of
the performance and observance of all obligations and covenants of this Indenture and the
Securities, including but not limited to the obligation to make payment of the principal of and
interest, if any, on all the Securities then outstanding, and the Company may thereupon or any time
thereafter be liquidated and dissolved.




ARTICLE IX




SUPPLEMENTAL INDENTURES




     Section 9.01 Supplemental Indentures Without Consent of Holders.



          Without the consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:




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               (1) to evidence the succession of another Person to the Company and the assumption by any such
successor of the covenants of the Company herein and in the Securities; or



               (2) to add to the covenants of the Company for the, benefit of the Holders of all or any
series of Securities (and if such covenants are to be for the benefit of less than all series of
Securities, stating that such covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the Company; or



               (3) to add any additional Events of Default; or



               (4) to add to or change any of the provisions of this Indenture to such extent as shall be
necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not
registrable as to principal, and with or without interest coupons, or to permit or facilitate the
issuance of Securities in uncertificated form; or



               (5) to add to, change or eliminate any of the provisions of this Indenture in respect of one
or more series of Securities, provided that any such addition, change or elimination (A) shall
neither (i) apply to any Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (ii) modify the rights of the Holder of
any such Security with respect to such provision or (B) shall become effective only when there is
no such Security Outstanding; or



               (6) to secure the Securities pursuant to the requirements of Article X or otherwise; or



               (7) to establish the form or terms of Securities of any series as permitted by Sections 2.01
and 3.01; or



               (8) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee
with respect to the Securities of one or more series and to add to or change any of the provisions
of this Indenture as shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, pursuant to the requirements of Section 6.11; or



               (9) to make provisions with respect to the conversion rights of Holders pursuant to the
requirements of Article XIII;



               (10) to cure any ambiguity, to correct or supplement any provision herein which may be
defective or inconsistent with any other provision herein, or to make any other provisions with
respect to matters or questions arising under this Indenture, provided that such action pursuant to
this clause (9) shall not adversely affect the interests of the Holders of Securities of any series
in any material respect.



     Section 9.02 Supplemental Indentures with Consent of Holders.



          With the consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series affected by such supplemental indenture, by Act of said



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Holders delivered to the Company and the Trustee, the Company, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any of the provisions
of this Indenture or of modifying in any manner the rights of the Holders of Securities of such
series under this Indenture; provided, however, that no such supplemental indenture shall, without
the consent of the Holder of each Outstanding Security affected thereby,



               (1) change the Stated Maturity of the principal of, or any installment of principal of or
interest on, any Security, or reduce the principal amount thereof or the rate of interest or the
time of payment of interest thereon or any premium payable upon the redemption thereof, or reduce
the amount of the principal of an Original Issue Discount Security that would be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to Section 5.02, or change any
Place of Payment where, or the coin or currency in which, any Security or any premium or interest
thereon is payable, or impair the right to institute suit for the enforcement of any such payment
on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption
Date), or adversely affect the right to convert any Security as provided in Article XIII or modify
the provisions of this Indenture with respect to the subordination of the Securities in a manner
adverse to the Holders, or



               (2) reduce the percentage in principal amount of the Outstanding Securities of any series, the
consent of whose Holders is required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this Indenture, or



               (3) modify any of the provisions of this Section or Section 5.13, 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 Security affected thereby, provided,
however, that this clause shall not be deemed to require the consent of any Holder with respect to
changes in the references to “the Trustee” and concomitant changes in this Section, or the deletion
of this proviso, in accordance with the requirements of Sections 6.11 and 9.01(8), or



               (4) change any obligation of ours to maintain an office or agency, or



               (5) change any obligation of ours to pay additional amounts, or



               (6) adversely affect the right of repayment or repurchase at the option of the Holder, or



               (7) reduce or postpone any sinking fund or similar provision.


A supplemental indenture which changes or eliminates any covenant or other provision of this
Indenture which has expressly been included solely for the benefit of one or more particular series
of Securities, or which modifies the rights of the Holders of Securities of such series with
respect to such covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.




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          It shall not be necessary for any Act of Holders under this Section to approve the particular
form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve
the substance thereof.




     Section 9.03 Execution of Supplemental Indentures.



          In executing, or accepting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts created by this Indenture, the
Trustee shall be provided with, and (subject to Section 6.01) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee’s own rights, duties or immunities under this
Indenture or otherwise.




     Section 9.04 Effect of Supplemental Indentures.



          Upon the execution of any supplemental indenture under this Article, this Indenture shall be
modified in accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated
and delivered hereunder shall be bound thereby.




     Section 9.05 Conformity with Trust Indenture Act.



          Every supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act.




     Section 9.06 Reference in Securities to Supplemental Indentures.



          Securities of any series authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in
form approved by the Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities of any series so modified as to conform, in the opinion
of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by
the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities
of such series.




ARTICLE X




COVENANTS




     Section 10.01 Payment of Securities.



          The Company covenants and agrees for the benefit of each series of Securities that it will pay
the principal of and interest on the Securities of that series on the dates and in the manner
provided in the Securities of that series and this Indenture. An installment of principal,
premium, if any, or interest on the Securities shall be considered paid on the date it is due if
the Trustee or Paying Agent (other than the Company or an Affiliate of the Company) holds for the
benefit of



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the Holders, on that date, immediately available funds deposited and designated for and
sufficient to pay the installment.



          The Company shall pay interest on overdue principal and on overdue installments of interest at
the rate specified in the Securities compounded semi-annually, to the extent lawful.




     Section 10.02 Maintenance of Office or Agency.



          The Company shall maintain in the Place of Payment for any series of Securities, an office or
agency where Securities of that series may be presented or surrendered for payment, where
Securities of that series may be surrendered for registration of transfer or exchange, where
Securities of any series that is convertible may be surrendered for conversion, and where notices
and demands to or upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company shall give prompt written notice to the Trustee of the location, and
any change in the location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate
Trust Office.




          The Company may also from time to time designate one or more other offices or agencies where
the Securities of one or more series may be presented or surrendered for any or all such purposes
and may from time to time rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain an office or
agency in each Place of Payment for Securities of any series for such purposes. The Company shall
give prompt written notice to the Trustee of any such designation or rescission and of any change
in the location of any such other office or agency. The Company hereby initially designates the
principal corporate trust office of the Trustee as such office of the Company.




     Section 10.03 Money for Securities Payments to Be Held in Trust.



          If the Company shall at any time act as its own Paying Agent with respect to any series of
Securities, it will, on or before each due date of the principal of or any premium or interest on
any of the Securities of that series, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will
promptly notify the Trustee of its action or failure so to act.




          Whenever the Company shall have one or more Paying Agents for any series of Securities, it
will, on or prior to each due date of the principal of or any premium or interest on any Securities
of that series, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be
held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its action or failure so to act.




          The Company will cause each Paying Agent for any series of Securities other than the Trustee
to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the
Trustee, subject to the provisions of this Section, that such Paying Agent will (1) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and (2)



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during the continuance of any default by the Company (or any other obligor upon the Securities
of that series) in the making of any payment in respect of the Securities of that series, upon the
written request of the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent for payment in respect of the Securities of that series.



          The Company may at any time, for the purpose of obtaining the satisfaction and discharge of
this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay,
to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.




          Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in
trust for the payment of the principal of or any premium or interest on any Security of any series
and remaining unclaimed for two years after such principal, premium or interest has become due and
payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before
being required to make any such repayment, may at the expense of the Company cause to be published
once, in a newspaper published in the English language, customarily published on each Business Day
and of general circulation in New York City, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid to the Company.




     Section 10.04 Corporate Existence.



     Subject to Article VIII, the Company shall do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence and the corporate or other
existence of each of its Subsidiaries in accordance with the respective organizational documents of
each of them and the rights (charter and statutory) and corporate franchises of the Company and
each of its Subsidiaries; provided, however, that the Company shall not be required to preserve,
with respect to itself, any right or franchise, and with respect to any of its Subsidiaries, any
such existence, right or franchise, if (a) the Board of Directors of the Company shall determine
that the preservation thereof is no longer desirable in the conduct of the business of the Company
and (b) the loss thereof is not disadvantageous in any material respect to the Holders.



     Section 10.05 Payment of Taxes and Other Claims.



          The Company shall, and shall cause each of its Subsidiaries to, pay or discharge or cause to
be paid or discharged, before the same shall become delinquent, (i) all taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest and additions to
taxes) levied or imposed upon the Company or any of its Subsidiaries or properties and assets of
the Company or any of its Subsidiaries and (ii) all lawful claims, whether for labor, materials,



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supplies, service or anything else, which have become due and payable and which by law have or
may become a Lien upon the property and assets of the Company or any of its Subsidiaries; provided,
however, 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 whose amount, applicability or validity is
being contested in good faith by appropriate proceedings and for which disputed amounts adequate
reserves have been established in accordance with generally accepted accounting principles.



     Section 10.06 Compliance Certificate; Notice of Default.



               (1) The Company shall deliver to the Trustee within 120 days after the end of its fiscal year
an Officers’ Certificate (one of the signatories of which shall be the Company’s principal
executive officer, principal financial officer or principal accounting officer) complying with
Section 314(a)(4) of the Trust Indenture Act and stating that a review of its activities and the
activities of its Subsidiaries during the preceding fiscal year has been made under the supervision
of the signing officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture (all without regard to periods of
grace, which shall be deemed fulfilled unless and until the expiration of such periods) or notice
requirements) and further stating, as to each such officer signing such certificate, whether or not
the signer knows of any failure by the Company or any Subsidiary of the Company to comply with any
conditions or covenants in this Indenture and, if such signer does know of such a failure to
comply, the certificate shall describe such failure with particularity. The Officers’ Certificate
shall also notify the Trustee should the relevant fiscal year end on any date other than the
current fiscal year end date.



               (2) The Company shall, so long as any of the Securities of any series are outstanding, deliver
to the Trustee, immediately upon becoming aware of any Event of Default with respect to such series
under this Indenture, an Officers’ Certificate specifying such Event of Default and what action the
Company is taking or proposes to take with respect thereto. The Trustee shall not be deemed to
have knowledge of an Event of Default unless one of its Responsible Officers receives notice of the
Event of Default giving rise thereto from the Company or any of the Holders.



     Section 10.07 Waiver of Stay, Extension or Usury Laws.



          The Company covenants for the benefit of each series of Securities (to the extent that it may
lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law or any usury law or other law
wherever enacted which would prohibit or forgive the Company from paying all or any portion of the
principal of or interest on the Securities of that series as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the covenants or the performance of this
Indenture; and (to the extent that it may lawfully do so) the Company hereby expressly waives for
the benefit of each series of Securities all benefit or advantage of any such law insofar as such
law applies to the Securities of that series, and covenants for the benefit of each series of
Securities that it shall not hinder, delay or impede the execution of any power herein granted to
the Trustee with respect to that series, but will suffer and permit the execution of every such
power as though no such law had been enacted.




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ARTICLE XI




REDEMPTION OF SECURITIES




     Section 11.01 Applicability of Article.



          Securities of any series which are redeemable before their Stated Maturity shall be redeemable
in accordance with their terms and (except as otherwise specified as contemplated by Section 3.01
for Securities of any series) in accordance with this Article.




     Section 11.02 Election to Redeem; Notice to Trustee.



          The election of the Company to redeem any Securities shall be evidenced by a Board Resolution.
In case of any redemption at the election of the Company of less than all the Securities of any
series, the Company shall, at least 60 days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date, of the principal amount of Securities of such series to be redeemed and, if
applicable, of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption provided in the terms of
such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers’ Certificate evidencing compliance with such restriction.




     Section 11.03 Selection by Trustee of Securities to Be Redeemed.



          If less than all the Securities of any series are to be redeemed (unless all of the Securities
of such series and of a specified tenor are to be redeemed), the particular Securities to be
redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from
the Outstanding Securities of such series not previously called for redemption, by such method as
the Trustee shall deem fair and appropriate and which may provide for the selection for redemption
of portions (equal to the minimum authorized denomination for Securities of that series or any
integral multiple thereof) of the principal amount of Securities of such series of a denomination
larger than the minimum authorized denomination for Securities of that series. If less than all of
the Securities of such series and of a specified tenor are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by
the Trustee, from the Outstanding Securities of such series and specified tenor not previously
called for redemption in accordance with the preceding sentence.




          If any Security selected for partial redemption is converted in part before termination of the
conversion right with respect to the portion of the Security so selected, the converted portion of
such Security shall be deemed (so far as may be) to be the portion selected for redemption.
Securities which have been converted during a selection of Securities to be redeemed shall be
treated by the Trustee as Outstanding for the purpose of such selection.




          The Trustee shall promptly notify the Company in writing of the Securities selected for
redemption and, in the case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed.




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          For all purposes of this Indenture, unless the context otherwise requires, all provisions
relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to
be redeemed only in part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.




     Section 11.04 Notice of Redemption.



          Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than
30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed,
at his address appearing in the Security Register.




          All notices of redemption shall state:




               (1) the Redemption Date,



               (2) the Redemption Price,



               (3) if less than all the Outstanding Securities of any series are to be redeemed, the
identification (and, in the case of partial redemption of any Securities, the principal amounts) of
the particular Securities to be redeemed,



               (4) that on the Redemption Date the Redemption Price will become due and payable upon each
such Security to be redeemed and, if applicable, that interest thereon will cease to accrue on and
after said date,



               (5) in the case of any Securities that are convertible pursuant to Article XIII, the
conversion price or rate, the date on which the right to convert the principal of the Securities to
be redeemed will terminate and the place or places where such Securities may be surrendered for
conversion;



               (6) the place or places where such Securities are to be surrendered for payment of the
Redemption Price,



               (7) that the redemption is for a sinking fund, if such is the case, and



               (8) applicable CUSIP Numbers.



          Notice of redemption of Securities to be redeemed at the election of the Company shall be
given by the Company or, at the Company’s request, by the Trustee in the name and at the expense of
the Company and shall be irrevocable.




     Section 11.05 Deposit of Redemption Price.



          Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) accrued interest on, all the Securities which are to be
redeemed on that date other than any Securities called for redemption on that date which have been
converted prior to the date of such deposit.




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          If any Security called for redemption is converted, any money deposited with the Trustee or
with any Paying Agent or so segregated and held in trust for the redemption of such Security shall
(subject to any right of the Holder of such Security or any Predecessor Security to receive
interest as provided in the last paragraph of Section 3.07) be paid to the Company upon Company
Request or, if then held by the Company, shall be discharged from such trust.


     Section 11.06 Securities Payable on Redemption Date.


          Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall,
on the Redemption Date, become due and payable at the Redemption Price therein specified, and from
and after such date (unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest. Upon surrender of any such
Security for redemption in accordance with said notice, such Security shall be paid by the Company
at the Redemption Price, together with accrued interest to the Redemption Date; provided, however,
that, unless otherwise specified as contemplated by Section 3.01, installments of interest whose
Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the close of business on
the relevant Record Dates according to their terms and the provisions of Section 3.07.


          If any Security called for redemption shall not be so paid upon surrender thereof for
redemption, the principal and any premium shall, until paid, bear interest from the Redemption Date
at the rate prescribed therefor in the Security.


     Section 11.07 Securities Redeemed in Part.


          Any Security which is to be redeemed only in part shall be surrendered at a Place of Payment
therefor (with, if the Company or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the
Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new
Security or Securities of the same series and of like tenor, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered.


ARTICLE XII


SINKING FUNDS


     Section 12.01 Applicability of Article.


          The provisions of this Article shall be applicable to any sinking fund for the retirement of
Securities of a series except as otherwise specified as contemplated by Section 3.01 for Securities
of such series.


          The minimum amount of any sinking fund payment provided for by the terms of Securities of any
series is herein referred to as a “mandatory sinking fund payment”, and any payment in excess of
such minimum amount provided for by the terms of Securities of any series


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is herein referred to as an “optional sinking fund payment”. If provided for by the terms of
Securities of any series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 12.02. Each sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of Securities of such series.



     Section 12.02 Satisfaction of Sinking Fund Payments with Securities.



          The Company (1) may deliver Outstanding Securities of a series (other than any previously
called for redemption) and (2) may apply as a credit Securities of a series which have been
converted pursuant to Article XIII or which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all
or any part of any sinking fund payment with respect to the Securities of such series required to
be made pursuant to the terms of such Securities as provided for by the terms of such series;
provided that such Securities have not been previously so credited. Such Securities shall be
received and credited for such purpose by the Trustee at the Redemption Price specified in such
Securities for redemption through operation of the sinking fund and the amount of such sinking fund
payment shall be reduced accordingly.




     Section 12.03 Redemption of Securities for Sinking Fund.



          Not less than 60 days prior to each sinking fund payment date for any series of Securities,
the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next
ensuing sinking fund payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which
is to be satisfied by delivering and crediting Securities of that series pursuant to Section 12.02
and will also deliver to the Trustee any Securities to be so delivered. Not less than 30 days
before each such sinking fund payment date the Trustee shall select the Securities to be redeemed
upon such sinking fund payment date in the manner specified in Section 11.03 and cause notice of
the redemption thereof to be given in the name of and at the expense of the Company in the manner
provided in Section 11.04. Such notice having been duly given, the redemption of such Securities
shall be made upon the terms and in the manner stated in Sections 11.06 and 11.07.




ARTICLE XIII




CONVERSION OF SECURITIES




     Section 13.01 Applicability; Conversion Privilege and Conversion Price. Securities of
any series which are convertible into Common Stock of the Company shall be convertible in
accordance with their terms and (except as otherwise specified as contemplated by Section 3.01 for
Securities of any series) in accordance with this Article.



          Subject to and upon compliance with the provisions of this Article, at the option of the
Holder thereof, any Security or any portion of the outstanding principal amount thereof which is
$1,000 or an integral multiple of $1,000 may, at the times specified for conversion as hereinafter
provided, be converted at the principal amount thereof, or of such portion thereof, into fully paid



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and nonassessable shares (calculated as to each conversion to the nearest 1/100 of a share) of
Common Stock of the Company at the conversion price, determined as hereinafter provided, in effect
at the time of conversion. Such conversion right shall expire at the close of business on the date
specified for Securities of such series. In case a Security or portion thereof is called for
redemption at the election of the Company, such conversion right in respect of the Security or
portion so called shall expire at the close of business on the 10th calendar day before the
Redemption Date, unless the Company defaults in making the payment due upon redemption.


          The price at which shares of Common Stock shall be delivered upon conversion (herein called
the “conversion price”) shall be the price specified in relation to Securities of such series
pursuant to Section 3.01, as it shall be adjusted in certain instances as provided in this Article.
The time or times at which Securities of a series shall be convertible shall be as specified for
such series pursuant to Section 3.01.


     Section 13.02 Exercise of Conversion Privilege. In order to exercise the conversion
privilege, the Holder of any Security to be converted shall surrender such Security, duly endorsed
or assigned to the Company or in blank, at any office or agency of the Company maintained for that
purpose pursuant to Section 10.02, accompanied by written notice to the Company (which shall be
substantially in the form set forth in Section 2.03) at such office or agency that the Holder
elects to convert such Security or, if less than the entire principal amount thereof is to be
converted, the portion thereof to be converted. Securities surrendered for conversion during the
period from the close of business on any Regular Record Date next preceding any Interest Payment
Date to the opening of business on such Interest Payment Date shall (except in the case of
Securities or portions thereof which have been called for redemption on a Redemption Date within
such period) be accompanied by payment in funds acceptable to the Company of an amount equal to the
interest payable on such Interest Payment Date on the principal amount of Securities being
surrendered for conversion. Subject to the provisions of Section 3.07 relating to the payment of
Defaulted Interest by the Company, the interest payment with respect to a Security called for
redemption on a Redemption Date during the period from the close of business on any Regular Record
Date next preceding any Interest Payment Date to the opening of business on such Interest Payment
Date shall be payable on such Interest Payment Date to the Holder of such Security at the close of
business on such Regular Record Date notwithstanding the conversion of such Security after such
Regular Record Date and prior to such Interest Payment Date, and the Holder converting such
Security need not include a payment of such interest payment amount upon surrender of such Security
for conversion. Except as provided in the preceding sentence and subject to the final paragraph of
Section 3.07, no payment or adjustment shall be made upon any conversion on account of any interest
accrued on the Securities surrendered for conversion or on account of any dividends on the Common
Stock issued upon conversion.


          Securities shall be deemed to have been converted immediately prior to the close of business
on the day of surrender of such Securities for conversion in accordance with the foregoing
provisions, and at such time the rights of the Holders of such Securities as Holders shall cease,
and the Person or Persons entitled to receive the Common Stock issuable upon conversion shall be
treated for all purposes as the record holder or holders of such Common Stock at such time. As
promptly as practicable on or after the conversion date, the Company shall issue and shall deliver
at such office or agency a certificate or certificates for the number of


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full shares of Common Stock issuable upon conversion, together with payment in lieu of any
fraction of a share, as provided in Section 13.03.


          In the case of any Security which is converted in part only, upon such conversion the Company
shall execute and the Trustee shall authenticate and deliver to the Holder thereof, at the expense
of the Company, a new Security or Securities of authorized denominations in aggregate principal
amount equal to the unconverted portion of the principal amount of such Security.


     Section 13.03 Fractions of Shares. No fractional shares of Common Stock shall be
issued upon conversion of Securities. If more than one Security shall be surrendered for
conversion at one time by the same Holder, the number of full shares which shall be issuable upon
conversion thereof shall be computed on the basis of the aggregate principal amount of the
Securities (or specified portions thereof) so surrendered. Instead of any fractional share of
Common Stock which would otherwise be issuable upon conversion of any Security or Securities (or
specified portions thereof), the Company shall pay a cash adjustment in respect of such fraction in
an amount equal to the same fraction of the daily closing price per share of Common Stock
(consistent with Section 13.04(6) below) at the close of business on the day of conversion.


     Section 13.04 Adjustment of Conversion Price.


               (1) In case the Company shall pay or make a dividend or other distribution on any class of
capital stock of the Company in Common Stock, the conversion price in effect at the opening of
business on the day following the date fixed for determination of stockholders entitled to receive
such dividend or other distribution shall be reduced by multiplying such conversion price by a
fraction of which the numerator shall be the number of shares of Common Stock outstanding at the
close of business on the date fixed for such determination and the denominator shall be the sum of
such number of shares and the total number of shares constituting such dividend or other
distribution, such reduction to become effective immediately after the opening of business on the
day following the date fixed for such determination. For the purposes of this paragraph (1), the
number of shares of Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip certificates issued
in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any
distribution on shares of Common Stock held in the treasury of the Company.


               (2) In case the Company shall issue rights or warrants to all holders of its Common Stock
entitling them to subscribe for or purchase shares of Common Stock at a price per share less than
the current market price per share (determined as provided in paragraph (6) of this Section) of the
Common Stock on the date fixed for the determination of stockholders entitled to receive such
rights or warrants (other than pursuant to a dividend reinvestment plan), the conversion price in
effect at the opening of business on the day following the date fixed for such determination shall
be reduced by multiplying such conversion price by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock which the aggregate of the offering price
of the total number of shares of Common Stock so offered for subscription or purchase would
purchase at such current market price and the


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denominator shall be the number of shares of Common Stock outstanding at the close of business
on the date fixed for such determination plus the number of shares of Common Stock so offered for
subscription or purchase, such reduction to become effective immediately after the opening of
business on the day following the date fixed for such determination. For the purposes of this
paragraph (2), the number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any
rights or warrants in respect of shares of Common Stock held in the treasury of the Company.



               (3) In case outstanding shares of Common Stock shall be subdivided into a greater number of
shares of Common Stock, the conversion price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall be proportionately reduced,
and, conversely, in case outstanding shares of Common Stock shall each be combined into a smaller
number of shares of Common Stock, the conversion price in effect at the opening of business on the
day following the day upon which such combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become effective immediately after
the opening of business on the day following the day upon which such subdivision or combination
becomes effective.



               (4) In case the Company shall, by dividend or otherwise, distribute to all holders of its
Common Stock evidences of its indebtedness or assets (including securities, but excluding any
rights or warrants referred to in paragraph (2) of this Section, any dividend or distribution paid
in cash out of the earned surplus of the Company and any dividend or distribution referred to in
paragraph (1) of this Section), the conversion price shall be adjusted so that the same shall equal
the price determined by multiplying the conversion price in effect immediately prior to the close
of business on the date fixed for the determination of stockholders entitled to receive such
distribution by a fraction of which the numerator shall be the current market price per share
(determined as provided in paragraph (6) of this Section) of the Common Stock on the date fixed for
such determination less the then fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution filed with the Trustee) of
the portion of the assets or evidences of indebtedness so distributed applicable to one share of
Common Stock and the denominator shall all be such current market price per share of the Common
Stock, such adjustment to become effective immediately prior to the opening of business on the day
following the date fixed for the determination of stockholders entitled to receive such
distribution.



               (5) The reclassification of Common Stock into securities other than Common Stock (other than
any reclassification upon a consolidation or merger to which Section 13.11 applies) shall be deemed
to involve (a) a distribution of such securities other than Common Stock to all holders of Common
Stock (and the effective date of such reclassification shall be deemed to be “the date fixed for
the determination of stockholders entitled to receive such distribution” and “the date fixed for
such determination” within the meaning of paragraph (4) of this Section), and (b) a subdivision or
combination, as the case may be, of the number of shares of Common Stock outstanding immediately
prior to such reclassification into the number of shares of Common Stock outstanding immediately
thereafter (and the effective date of such reclassification shall be deemed to be “the day upon
which such subdivision becomes effective”



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or “the day upon which such combination becomes effective”, as the case may be, and “the day
upon which such subdivision or combination becomes effective” within the meaning of paragraph (3)
of this Section).


               (6) For the purpose of any computation under paragraphs (2) and (4) of this Section, the
current market price per share of Common Stock on any day shall be deemed to be the average of the
daily closing prices for the five consecutive trading days (i.e ., Business Days on which
the Common Stock is traded) selected by the Board of Directors commencing not more than 20 trading
days before, and ending not later than, the earlier of the day in question and the day before the
“ex” date with respect to the issuance or distribution requiring such computation. For this
purpose, the term “ex” date, when used with respect to any issuance or distribution, shall mean the
first date on which the Common Stock trades regular way on the applicable exchange or in the
applicable market without the right to receive such issuance or distribution. The closing price
for each day shall be the reported last sale price regular way or, in case no such reported sale
takes place on such day, the average of the reported closing bid and asked prices regular way, in
either case on the New York Stock Exchange or, if the Common Stock is not listed or admitted to
trading on such Exchange, on the principal national securities exchange on which the Common Stock
is listed or admitted to trading or, if not listed or admitted to trading on any national
securities exchange, on the Nasdaq Stock Market or, if the Common Stock is not listed or admitted
to trading on any national securities exchange or quoted on the Nasdaq Stock Market, the average of
the closing bid and asked prices in the over-the-counter market as furnished by any New York Stock
Exchange member firm selected from time to time by the Board of Directors for that purpose.


               (7) The Company may make such reductions in the conversion price, in addition to those
required by paragraphs (1), (2), (3) and (4) of this Section, as it considers to be advisable in
order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from
any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe
for stock or from any event treated as such for income tax purposes or for any other reasons. The
Company shall have the power to resolve any ambiguity or correct any error pursuant to this section
and its actions in so doing shall be final and conclusive.


               (8) No adjustment in the conversion price shall be required unless such adjustment would
require an increase or decrease of at least one percent in such conversion price; provided,
however, that any adjustment which by reason of this paragraph (8) is not required to be
made shall be carried forward and taken into account in any subsequent adjustment. All
calculations under this Article shall be made to the nearest cent or to the nearest 1/100 of a
share, as the case may be.


     Section 13.05 Notice of Adjustments of Conversion Price.


          Whenever the conversion price is adjusted as herein provided:


               (1) the Company shall compute the adjusted conversion price in accordance with Section 13.04
and shall prepare a certificate signed by the Treasurer or other appropriate officer of the Company
setting forth the adjusted conversion price and showing in reasonable detail the facts upon which
such adjustment is based, and such certificate shall promptly be


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delivered to the Trustee and the Conversion Agent at each office or agency maintained for the
purpose of conversion of Securities pursuant to Section 10.02; and



               (2) a notice stating that the conversion price has been adjusted and setting forth the
adjusted conversion price shall be required, and as soon as practicable after it is required, such
notice shall be delivered electronically or mailed by the Company to all Holders at their last
addresses as they shall appear in the Security Register.



     Section 13.06 Notice of Certain Corporate Action.



     In case:



               (1) the Company shall declare a dividend (or any other distribution) on its Common Stock
payable otherwise than in cash out of its earned surplus; or



               (2) the Company shall authorize the granting to all holders of its Common Stock of rights or
warrants to subscribe for or purchase any shares of capital stock of any class or of any other
rights; or



               (3) of any reclassification of the Common Stock of the Company (other than a subdivision or
combination of its outstanding shares of Common Stock), or of any consolidation, merger or share
exchange to which the Company is a party and for which approval of any stockholders of the Company
is required, or of the sale or transfer of all or substantially all of the assets of the Company;
or



               (4) of the voluntary or involuntary dissolution, liquidation or winding up of the Company;


then the Company shall cause to be filed at each office or agency maintained for the purpose of
conversion of Securities pursuant to Section 10.02, and shall cause to be mailed to all Holders at
their last addresses as they shall appear in the Security Register, at least 20 days (or 10 days in
any case specified in clause (a) or (b) above) prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution, rights or warrants, or, if a record is not to be taken, the
date as of which the holders of Common Stock of record to be entitled to such dividend,
distribution, rights or warrants are to be determined, or (y) the date on which such
reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation
or winding up is expected to become effective, and the date as of which it is expected that holders
of Common Stock of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification, consolidation, merger,
share exchange, sale, transfer, dissolution, liquidation or winding up. Neither the failure to
give such notice nor any defect therein shall affect the legality or validity of the proceedings
described in clauses (a) through (d) of this Section 13.06. If at the time the Trustee shall not
be the Conversion Agent, a copy of such notice shall also forthwith be delivered by the Company to
the Trustee.




     Not less than seven days prior to any date fixed for the determination of stockholders
entitled to receive such distribution, the Company shall cause to be filed at each office or agency
maintained for the purpose of conversion of Securities pursuant to Section 10.02, and shall cause



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to be mailed to all Holders at their last addresses as they shall appear in the Security Register,
a notice stating the date on which the such determination is to be made, and briefly describing the
import thereof. If at the time the Trustee shall not be the Conversion Agent, a copy of such notice
shall also forthwith be delivered by the Company to the Trustee.



     Section 13.07 Company to Reserve Common Stock. The Company shall at all times reserve
and keep available out of its authorized but unissued Common Stock, for the purpose of effecting
the conversion of Securities, the full number of shares of Common Stock then issuable upon the
conversion of all Outstanding Securities.



     Section 13.08 Taxes on Conversions. The Company will pay any and all taxes that may
be payable in respect of the issue or delivery of shares of Common Stock on conversion of
Securities pursuant hereto. The Company shall not, however, be required to pay any tax which may
be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock
in a name other than that of the Holder of the Security or Securities to be converted, and no such
issue or delivery shall be made unless and until the Person requesting such issue has paid to the
Company the amount of any such tax, or has established to the satisfaction of the Company that such
tax has been paid.



     Section 13.09 Covenant as to Common Stock. The Company covenants that all shares of
Common Stock which may be issued upon conversion of Securities will upon issue be fully paid and
nonassessable and, except as provided in Section 13.08, the Company will pay all taxes, liens and
charges with respect to the issue thereof.



     Section 13.10 Cancellation of Converted Securities. All Securities delivered for
conversion shall be delivered to the Trustee to be cancelled by or at the direction of the Trustee,
which shall dispose of the same as provided in Section 3.09.



     Section 13.11 Provisions in Case of Consolidation, Merger or Sale of Assets. In case
of any consolidation of the Company with, or merger of the Company into, any other Person, any
merger of another Person into the Company (other than a merger which does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of Common Stock of the
Company) or any sale or transfer of all or substantially all of the assets of the Company, the
Person formed by such consolidation or resulting from such merger or which acquires such assets, as
the case may be, shall execute and deliver to the Trustee a supplemental indenture providing that
the Holder of each convertible Security then outstanding shall have the right thereafter, during
the period such Security shall be convertible as specified in Section 13.01, to convert such
Security only into the kind and amount of securities, cash and other property receivable upon such
consolidation, merger, sale or transfer by a holder of the number of shares of Common Stock of the
Company into which such Security might have been converted immediately prior to such consolidation,
merger, sale or transfer, assuming such holder of Common Stock of the Company failed to exercise
his rights of election, if any, as to the kind or amount of securities, cash and other property
receivable upon such consolidation, merger, sale or transfer (provided that if the kind or amount
of securities, cash and other property receivable upon such consolidation, merger, sale or transfer
is not the same for each share of Common Stock of the Company in respect of which such rights of
election shall not have been exercised (“non-electing share”), then for the purpose of this Section
the kind and amount of securities,



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cash and other property receivable upon such consolidation, merger, sale or transfer by each
non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality
of the non-electing shares). Such supplemental indenture shall provide for adjustments which, for
events subsequent to the effective date of such supplemental indenture, shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article. The above
provisions of this Section shall similarly apply to successive consolidations, mergers, sales or
transfers.



     Section 13.12 Responsibility of Trustee. Neither the Trustee nor any Conversion Agent
shall at any time be under any duty or responsibility to any Holder of Securities to determine
whether any fact exists which may require any adjustment of the conversion price, or with respect
to the nature or extent of any such adjustment when made, or with respect to the method employed,
or herein or in any supplemental indenture provided to be employed, in making the same. Neither
the Trustee nor any Conversion Agent shall be accountable with respect to the registration,
validity or value (or the kind or amount) of any shares of Common Stock, or of any securities or
property, which may at any time be issued or delivered upon the conversion of any Security, or for
monitoring the price of the Common Stock or effecting any calculations hereunder; and neither the
Trustee nor any Conversion Agent makes any representation with respect thereto. Neither the
Trustee nor any Conversion Agent shall be responsible for any failure of the Company to issue or
transfer or deliver any Common Stock or stock certificates or other securities or property or to
make any cash payment upon the surrender of any Security for the purpose of conversion or to comply
with any of the covenants of the Company contained in this Article XIII.



     This instrument may be executed in any number of counterparts, each of which so executed shall
be deemed to be an original, but all such counterparts shall together constitute but one and the
same instrument.



(Signature Page to Follow)




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          IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of
the day and year first above written.


	 	 	 	 	 	 	 
	 	 	JEFFERIES GROUP, INC.	 	 
	 
	 	 	 	 	 	 
	 
	 	By:	 	 	 	 
	 
	 	 	 	 

Name:
	 	 
	 
	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK MELLON	 	 
	 
	 	 	 	 	 	 
	 
	 	By:	 	 	 	 
	 
	 	 	 	 

Name:
	 	 
	 
	 	 	 	Title:	 	 






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