exv4w6






EXHIBIT 4.6




 

 








FORM OF

SUBORDINATED INDENTURE




Between




DIAMOND FOODS, INC.




and




WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE




Dated as of                     , 2009




 

 






 









 














	 	 	 	 	 
	ARTICLE ONE DEFINITIONS
	 	 	7	 
	SECTION 1.01. Certain Terms Defined
	 	 	7	 
	“Affiliate”
	 	 	7	 
	“Agent”
	 	 	8	 
	“Authenticating Agent”
	 	 	8	 
	“Authorized Newspaper”
	 	 	8	 
	“Board of Directors”
	 	 	8	 
	“Board Resolution”
	 	 	8	 
	“Business Day”
	 	 	8	 
	“Commission”
	 	 	8	 
	“Company”
	 	 	8	 
	“Company Order”
	 	 	8	 
	“covenant defeasance”
	 	 	8	 
	“Defaulted Interest”
	 	 	8	 
	“Depository”
	 	 	8	 
	“Euro” or “euro”
	 	 	8	 
	“Event of Default”
	 	 	8	 
	“Exchange Act”
	 	 	8	 
	“Foreign Currency”
	 	 	8	 
	“Global Subordinated Security”
	 	 	9	 
	“Holder,” “Holder of Subordinated Securities,” “Subordinated Securityholder”
	 	 	9	 
	“Interest Payment Date”
	 	 	9	 
	“IRS”
	 	 	9	 
	“Judgment Currency”
	 	 	9	 
	“Officer’s Certificate”
	 	 	9	 
	“Opinion of Counsel”
	 	 	9	 
	“Original Issue Date”
	 	 	9	 
	“Original Issue Discount Subordinated Security”
	 	 	9	 
	“Outstanding”
	 	 	9	 
	“Paying Agent”
	 	 	10	 
	“Periodic Offering”
	 	 	10	 
	“Person”
	 	 	10	 
	“Predecessor Subordinated Security”
	 	 	10	 
	“principal”
	 	 	10	 
	“Principal Office of the Trustee”
	 	 	10	 
	“Record Date”
	 	 	10	 
	“Register”
	 	 	10	 
	“Registered Subordinated Security”
	 	 	10	 
	“Required Currency”
	 	 	10	 
	“Responsible Officer”
	 	 	10	 
	“Senior Indebtedness
	 	 	10	 
	“Special Record Date”
	 	 	11	 
	“Stated Maturity”
	 	 	11	 
	“Subordinated Indenture”
	 	 	11	 
	“Subordinated Security” or “Subordinated Securities”
	 	 	11	 
	“Supplemental Subordinated Indenture”
	 	 	11	 
	“Trustee”
	 	 	11	 
	“Trust Indenture Act”
	 	 	11	 
	“United States Dollars”
	 	 	11	 
	“U.S. Government Obligations”
	 	 	11	 
	“Yield to Maturity”
	 	 	11	 
	ARTICLE TWO ISSUE, DESCRIPTION, EXECUTION, REGISTRATION, TRANSFER AND EXCHANGE OF SUBORDINATED SECURITIES
	 	 	11	 
	SECTION 2.01. Form Of Subordinated Securities and Trustee’s Certificate Of Authentication
	 	 	11	 
	SECTION 2.02. Form of Trustee’s Certificate of Authentication
	 	 	11	 






2









 






	 	 	 	 	 
	SECTION 2.03. Amount Unlimited, Issuable in Series
	 	 	12	 
	SECTION 2.04. Authentication and Delivery of Subordinated Indentures
	 	 	14	 
	SECTION 2.05. Execution of Subordinated Securities
	 	 	15	 
	SECTION 2.06. Certificate of Authentication
	 	 	15	 
	SECTION 2.07. Denominations; Payment of Interest on Subordinated Securities
	 	 	16	 
	SECTION 2.08. Registration, Transfer and Exchange of Subordinated Securities
	 	 	17	 
	SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Subordinated Securities
	 	 	18	 
	SECTION 2.10. Cancellation and Destruction of Surrendered Subordinated Securities
	 	 	18	 
	SECTION 2.11. Temporary Subordinated Securities
	 	 	18	 
	SECTION 2.12. Subordinated Securities in Global Form
	 	 	19	 
	SECTION 2.13. CUSIP Numbers
	 	 	19	 
	 
	 	 		 
	ARTICLE THREE REDEMPTION OF SUBORDINATED SECURITIES
	 	 	20	 
	SECTION 3.01. Applicability of Article
	 	 	20	 
	SECTION 3.02. Notice of Redemption; Partial Redemptions
	 	 	20	 
	SECTION 3.03. Payment of Subordinated Securities Called for Redemption
	 	 	20	 
	SECTION 3.04. Exclusion of Certain Subordinated Securities From Eligibility for Selection for Redemption
	 	 	21	 
	ARTICLE FOUR PARTICULAR COVENANTS OF THE COMPANY
	 	 	21	 
	SECTION 4.01. Payment of Principal of and Interest on Subordinated Securities
	 	 	21	 
	SECTION 4.02. Corporate Existence of the Company; Consolidation, Merger, Sale or Transfer
	 	 	21	 
	SECTION 4.03. Maintenance of Offices or Agencies for Transfer, Registration, Exchange and Payment of Subordinated
Securities
	 	 	22	 
	SECTION 4.04. Appointment to Fill a Vacancy in the Office of Trustee
	 	 	22	 
	SECTION 4.05. Duties of Paying Agent
	 	 	22	 
	SECTION 4.06. Notice of Default
	 	 	23	 
	SECTION 4.07. Maintenance of Properties
	 	 	23	 
	SECTION 4.08. Payment of Taxes and Other Claims
	 	 	23	 
	ARTICLE FIVE SUBORDINATED SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
	 	 	23	 
	SECTION 5.01. Company to Furnish Trustee Information as to the Names and Addresses of Subordinated Securityholders
	 	 	23	 
	SECTION 5.02. Preservation of Information; Communication to Subordinated Securityholders
	 	 	23	 
	SECTION 5.03. Reports by Company
	 	 	24	 
	SECTION 5.04. Reports by Trustee
	 	 	25	 
	ARTICLE SIX REMEDIES OF THE TRUSTEE AND SUBORDINATED SECURITYHOLDERS ON EVENT OF DEFAULT
	 	 	26	 
	SECTION 6.01. Events of Default; Acceleration, Waiver of Default And Restoration of Position and Rights
	 	 	26	 
	SECTION 6.02. Covenant of Company to Pay to Trustee Whole Amount Due on Subordinated Securities on Default in
Payment of Interest or Principal
	 	 	28	 
	SECTION 6.03. Trustee May File Proofs of Claim
	 	 	28	 
	SECTION 6.04. Trustee May Enforce Claims Without Possession of Subordinated Securities
	 	 	29	 
	SECTION 6.05. Application of Moneys Collected by Trustee
	 	 	29	 
	SECTION 6.06. Limitation on Suits by Holders of Subordinated Securities
	 	 	30	 
	SECTION 6.07. Rights and Remedies Cumulative
	 	 	30	 
	SECTION 6.08. Delay or Omission Not Waiver
	 	 	30	 
	SECTION 6.09. Control by Holders; Waiver of Past Defaults
	 	 	30	 
	SECTION 6.10. Trustee to Give Notice of Defaults Known to it, But May Withhold in Certain Circumstances
	 	 	31	 
	SECTION 6.11. Requirement of an Undertaking to Pay Costs in Certain Suits Under the Subordinated Indenture or
Against the Trustee
	 	 	31	 
	SECTION 6.12. Waiver of Stay, or Extension Laws
	 	 	31	 
	ARTICLE SEVEN CONCERNING THE TRUSTEE
	 	 	31	 
	SECTION 7.01. Certain Duties and Responsibilities of Trustee
	 	 	31	 
	SECTION 7.02. Certain Rights of Trustee
	 	 	32	 
	SECTION 7.03. Trustee Not Responsible for Recitals or Application of Proceeds
	 	 	33	 
	SECTION 7.04. Trustee May Own Subordinated Securities
	 	 	33	 






3









 






	 	 	 	 	 
	SECTION 7.05. Moneys Received by Trustee to be Held in Trust
	 	 	34	 
	SECTION 7.06. Trustee Entitled to Compensation, Reimbursement and Indemnity
	 	 	34	 
	SECTION 7.07. Right of Trustee to Rely on Officer’s Certificate Where No Other Evidence Specifically Prescribed
	 	 	34	 
	SECTION 7.08. Disqualification; Conflicting Interest
	 	 	34	 
	SECTION 7.09. Requirements for Eligibility of Trustee
	 	 	34	 
	SECTION 7.10. Resignation and Removal of Trustee; Appointment of Successor
	 	 	35	 
	SECTION 7.11. Acceptance of Appointment by Successor Trustee
	 	 	35	 
	SECTION 7.12. Successor to Trustee by Merger, Consolidation or Succession to Business
	 	 	36	 
	SECTION 7.13. Preferential Collection of Claims Against Company
	 	 	36	 
	SECTION 7.14. Appointment of Authenticating Agent
	 	 	36	 
	ARTICLE EIGHT CONCERNING THE SUBORDINATED SECURITYHOLDERS
	 	 	37	 
	SECTION 8.01. Evidence of Action by Subordinated Securityholders
	 	 	37	 
	SECTION 8.02. Proof of Execution of Instruments and of Holding of Subordinated Securities
	 	 	37	 
	SECTION 8.03. Who May be Deemed Owners of Subordinated Securities
	 	 	38	 
	SECTION 8.04. Subordinated Securities Owned by the Company or Controlled or Controlling Persons Disregarded for
Certain Purposes
	 	 	38	 
	SECTION 8.05. Instruments Executed by Subordinated Securityholders Bind Future Holders
	 	 	38	 
	ARTICLE NINE SUBORDINATED SECURITYHOLDERS’ MEETINGS
	 	 	39	 
	SECTION 9.01. Purposes for Which Meetings May be Called
	 	 	39	 
	SECTION 9.02. Manner of Calling Meetings
	 	 	39	 
	SECTION 9.03. Call of Meeting by the Company or Subordinated Securityholders
	 	 	39	 
	SECTION 9.04. Who May Attend and Vote at Meetings
	 	 	39	 
	SECTION 9.05. Regulations May be Made by Trustee; Conduct of the Meeting; Voting Rights — Adjournment
	 	 	39	 
	SECTION 9.06. Manner of Voting at Meetings and Record to be Kept
	 	 	40	 
	SECTION 9.07. Exercise of Rights of Trustee and Subordinated Securityholders Not to be Hindered or Delayed
	 	 	40	 
	ARTICLE TEN SUPPLEMENTAL SUBORDINATED INDENTURES
	 	 	40	 
	SECTION 10.01. Purposes for Which Supplemental Subordinated Indentures May be Entered into Without Consent of
Subordinated Securityholders
	 	 	40	 
	SECTION 10.02. Modification of Subordinated Indenture With Consent of Holders of Subordinated Securities
	 	 	41	 
	SECTION 10.03. Effect of Supplemental Subordinated Indentures
	 	 	42	 
	SECTION 10.04. Subordinated Securities May Bear Notation of Changes by Supplemental Subordinated Indentures
	 	 	43	 
	ARTICLE ELEVEN DISCHARGE; DEFEASANCE
	 	 	43	 
	SECTION 11.01. Satisfaction and Discharge of Subordinated Indenture
	 	 	43	 
	SECTION 11.02. Application by Trustee of Funds Deposited for Payment of Subordinated Securities
	 	 	45	 
	SECTION 11.03. Repayment of Moneys Held by Paying Agent
	 	 	45	 
	SECTION 11.04. Return of Moneys Held by Trustee and Paying Agent Unclaimed for Two Years
	 	 	45	 
	SECTION 11.05. Indemnity for U.S. Government of Obligations
	 	 	45	 
	ARTICLE TWELVE IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
	 	 	46	 
	SECTION 12.01. Incorporators, Stockholders, Officers and Directors of Company Exempt from Individual Liability
	 	 	46	 
	ARTICLE THIRTEEN MISCELLANEOUS PROVISIONS
	 	 	46	 
	SECTION 13.01. Successors and Assigns of the Company Bound by Subordinated Indenture
	 	 	46	 
	SECTION 13.02. Notices; Effectiveness
	 	 	46	 
	SECTION 13.03. Compliance Certificates and Opinions
	 	 	47	 
	SECTION 13.04. Days on Which Payment to be Made, Notice Given or Other Action Taken
	 	 	47	 
	SECTION 13.05. Provisions Required by Trust Indenture Act to Control
	 	 	48	 
	SECTION 13.06. Governing Law and Waiver of Trial by Jury
	 	 	48	 
	SECTION 13.07. Effect of Headings
	 	 	48	 
	SECTION 13.08. Judgment Currency
	 	 	48	 
	SECTION 13.09. Provisions of the Subordinated Indenture and Subordinated Securities for the Sole Benefit of the
Parties and the Subordinated Securityholders
	 	 	48	 
	SECTION 13.10. Subordinated Indenture May be Executed in Counterparts
	 	 	49	 






4









 






	 	 	 	 	 
	SECTION 13.11. Facsimile or PDF
	 	 	49	 
	SECTION 13.12. Force Majeure
	 	 	49	 
	SECTION 13.13. U.S.A. Patriot Act
	 	 	49	 
	ARTICLE FOURTEEN SUBORDINATION OF SECURITIES
	 	 	49	 
	SECTION 14.01. Securities Subordinated to Senior Indebtedness
	 	 	49	 
	SECTION 14.02. Subrogation
	 	 	50	 
	SECTION 14.03. Obligation of the Company Unconditional
	 	 	50	 
	SECTION 14.04. Payments on Securities Permitted
	 	 	50	 
	SECTION 14.05. Effectuation of Subordinated by Trustee
	 	 	51	 
	SECTION 14.06. Knowledge of Trustee
	 	 	51	 
	SECTION 14.07. Trustee May Hold Senior Indebtedness
	 	 	51	 
	SECTION 14.08. Rights of Holder of Senior Indebtedness Not Impaired
	 	 	51	 






5









 






TABLE SHOWING REFLECTION IN THIS SUBORDINATED INDENTURE OF

CERTAIN PROVISIONS OF THE TRUST INDENTURE ACT OF 1939*




	 	 	 
	Section of	 	Section
	Indenture	 	of Act
	 
	310(a)(1)
	 	7.09
	310(a)(2)
	 	7.09
	310(a)(3)
	 	Inapplicable
	310(a)(4)
	 	Inapplicable
	310(a)(5)
	 	7.09
	310(b)
	 	7.08, 7.10
	310(c)
	 	Inapplicable
	311(a)
	 	7.13(a), 7.13(c)
	311(b)
	 	7.13(b), 7.13(c)
	311(c)
	 	Inapplicable
	312(a)
	 	5.01, 5.02(a)
	312(b)
	 	5.02(b)
	312(c)
	 	5.02(c)
	313(a)
	 	5.04(a)
	313(b)(1)
	 	Inapplicable
	313(b)(2)
	 	5.04(b)
	313(c)
	 	5.04(c)
	313(d)
	 	5.04(d)
	314(a)(1)
	 	5.03(a)
	314(a)(2)
	 	5.03(b)
	314(a)(3)
	 	5.03(c)
	314(a)(4)
	 	5.03(d)
	314(b)
	 	Inapplicable
	314(c)
	 	13.03
	314(d)
	 	Inapplicable
	314(e)
	 	13.03
	314(f)
	 	Omitted
	315(a)
	 	7.01
	315(b)
	 	6.10
	315(c)
	 	7.01
	315(d)
	 	7.01
	315(e)
	 	6.11
	316(a)(1)
	 	6.09
	316(a)(2)
	 	Omitted
	316(b)
	 	6.06
	316(c)
	 	6.09
	317(a)
	 	6.02, 6.03
	317(b)
	 	4.06
	318(a)
	 	13.05








 




			
	*	 	This Table is not part of the Subordinated Indenture.






6











 





     THIS SUBORDINATED INDENTURE, dated as of ______, 2009, between DIAMOND FOODS, INC., a
Delaware corporation (the “Company”), and Wells Fargo Bank, N.A., a national banking association
duly organized and existing under the laws of the United States, as trustee (the “Trustee”).



WITNESSETH:




     WHEREAS, the Company has duly authorized the issuance, sale, execution and delivery, from time
to time, of its unsecured evidences of subordinated indebtedness (hereinafter referred to as the
“Subordinated Securities”), without limit as to principal amount, issuable in one or more series,
the amount and terms of each such series to be determined as hereinafter provided; and, to provide
the terms and conditions upon which the Subordinated Securities are to be issued, authenticated and
delivered, the Company has duly authorized the execution of this Subordinated Indenture; and



     WHEREAS, all acts and things necessary to make the Subordinated Securities, when executed by
the Company and authenticated and delivered by the Trustee as in this Subordinated Indenture
provided, the valid, binding and legal subordinated obligations of the Company, and to constitute
this Subordinated Indenture a valid indenture and agreement according to its terms, have been done
and performed, and the execution of this Subordinated Indenture and the issuance hereunder of the
Subordinated Securities have in all respects been duly authorized;



     NOW, THEREFORE, THIS SUBORDINATED INDENTURE



WITNESSETH:




     That in order to declare the terms and conditions upon which the Subordinated Securities are
to be issued, authenticated and delivered, and in consideration of the premises and of the purchase
and acceptance of the Subordinated Securities by the Holders thereof, the Company covenants and
agrees with the Trustee, for the equal and proportionate benefit of the respective Holders from
time to time of the Subordinated Securities or of any series thereof, as follows:



ARTICLE ONE




DEFINITIONS




     SECTION 1.01. Certain Terms Defined. For all purposes of this Subordinated Indenture,
except as otherwise expressly provided or unless the context otherwise requires:



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




          (b) 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;




          (c) all accounting terms not otherwise defined herein shall have the meanings assigned to them
and all computations herein provided for shall be made, in accordance with generally accepted
accounting principles, and the term “U.S. generally accepted accounting principles” shall mean such
principles as they exist at the date of applicability thereof; and




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




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



7









 





     “Agent” means any Registrar, Paying Agent, transfer agent or Authenticating Agent.



     “Authenticating Agent” shall the meaning set forth in Section 7.14.



     “Authorized Newspaper” means a newspaper (which, in the case of The City of New York, will, if
practicable, be The Wall Street Journal (Eastern Edition), published in an official language of the
country of publication customarily published at least once a day for at least five days in each
calendar week and of general circulation. If it shall be impractical in the opinion of the Trustee
to make any publication of any notice required hereby in an Authorized Newspaper, any publication
or other notice in lieu thereof which is made or given with the approval of the Trustee shall
constitute a sufficient publication of such notice.



     “Board of Directors” shall mean the Board of Directors of the Company, or any duly authorized
committee of such Board of Directors.



     “Board Resolution” shall mean on or more resolutions of the Board of Directors of the Company
certified by the Secretary or by an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors of the Company and to be in full force and effect on the date of such
certification.



     “Business Day” means, with respect to any Subordinated Security, a day that is not a Saturday,
Sunday or a day on which the office of the Trustee or banking institutions in the City of New York
in which amounts are payable, as specified in the form of such Subordinated Security, are
authorized or required by any applicable law or regulation to be closed.



     “Commission” shall mean the U.S. Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act, or if at any time after the execution of this
Subordinated Indenture such Commission is not existing and performing the duties theretofore
assigned to it under the Trust Indenture Act, then the body performing such duties at such time.



     “Company” shall mean Diamond Foods, Inc., a Delaware corporation, until a successor
corporation shall have become such pursuant to the applicable provisions hereof, and thereafter
“Company” shall mean such successor Company.



     “Company Order” means a written statement, request or order of the Company signed in its name
by the Chairman of the Board of Directors of the Company, the President or Chief Executive Officer,
any Vice President or the Treasurer of the Company.



     “covenant defeasance” shall have the meaning set forth in Section 11.01.



     “Defaulted Interest” shall have the meaning set forth in Section 2.07.



     “Depository” shall mean, with respect to the Subordinated Securities of any series issuable or
issued in whole or in part in the form of one or more Global Subordinated Securities, the Person
designated as Depository by the Company pursuant to Section 2.03 of this Subordinated Indenture
until a successor Depository shall have become such pursuant to the applicable provisions of this
Subordinated Indenture, and thereafter the term “Depository” shall mean or include each Person who
is then a Depository hereunder, and if at any time there is more than one such Person, “Depository”
as used with respect to the Subordinated Securities of any such series shall mean the Depository
with respect to the Subordinated Securities of that series.



     “Euro” or “euro” means the currency adopted by those countries participating in the third
stage of the European Monetary Union.



     “Event of Default” with respect to Subordinated Securities of any series shall mean any event
specified as such in Section 6.01 and any other event as may be established with respect to the
securities of such series as permitted by Section 2.03. An Event of Default shall “exist” if an
Event of Default shall have occurred and be continuing.



     “Exchange Act” means the Securities Exchange Act of 1934, as amended.



     “Foreign Currency” means a currency issued by the government of a country other than the
United States of America, and the European Currency Unit as defined and revised from time to time
by the European Monetary System of the European Community and/or Euros.



8









 





     “Global Subordinated Security” means a Subordinated Security evidencing all or a portion of a
series of Registered Subordinated Securities, issued to the Depository for such series in
accordance with Section 2.12, and bearing the legend prescribed in Section 2.12 and any other
legend required by the Depository for such series.



     “Holder,” “Holder of Subordinated Securities,” “Subordinated Securityholder” or any other
similar term means in the case of any Registered Subordinated Security, the person in whose name
such Subordinated Security is registered in the Register kept by the Company for that purpose in
accordance with the terms hereof.



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



     “IRS” means the Internal Revenue Service of the United States Department of the Treasury, or
any successor entity.



     “Judgment Currency” has the meaning set forth in Section 13.09.



     “Officer’s Certificate” shall mean a certificate signed by the Chairman of the Board of
Directors of the Company, any Vice—Chairman of the Board of Directors of the Company, the
President or Chief Executive Officer or any Vice—President, the Treasurer, any Assistant
Treasurer, the Secretary or any Assistant Secretary of the Company.



     “Opinion of Counsel” shall mean a written opinion of legal counsel who may be an employee of
the Company or other counsel satisfactory to the Trustee.



     “Original Issue Date” of any Subordinated Security (or portion thereof) means the earlier of
(a) the date of such Subordinated Security or (b) the date of any Subordinated Security (or portion
thereof) for which such Subordinated Security was issued (directly or indirectly) on registration
of transfer, exchange or substitution.



     “Original Issue Discount Subordinated Security” shall mean (a) any Subordinated Security which
provides for an amount less than the principal amount thereof to be due and payable upon
declaration of acceleration of the maturity thereof pursuant to Section 6.01 or (b) any other
Subordinated Security which for United States Federal income tax purposes would be considered an
original issue discount security.



     “Outstanding” when used with reference to Subordinated Securities shall, subject to the
provisions of Section 8.04, mean, as of the date of determination, all Subordinated Securities
theretofore authenticated and delivered under this Subordinated Indenture, except:



          (a) Subordinated Securities theretofore canceled by the Trustee or delivered to the Trustee
for cancellation;




          (b) Subordinated Securities, or portions thereof, for whose payment or redemption moneys or
U.S. Government Obligations (as provided in Section 11.01) in the necessary amount have been
theretofore deposited with the Trustee or with any Paying Agent (other than the Company) or shall
have been set aside, segregated and held in trust by the Company (if the Company shall act as its
own Paying Agent) in trust for the Holders of such Subordinated Securities, provided that if such
Subordinated Securities or portions thereof, are to be redeemed prior to the Stated Maturity
thereof, notice of such redemption has been duly given as provided in Article Three hereof, or
provision therefor satisfactory to the Trustee has been made;




          (c) Subordinated Securities in exchange for or in lieu of which other Subordinated Securities
shall have been authenticated and delivered under this Subordinated Indenture; and




          (d) Subordinated Securities alleged to have been destroyed, lost or stolen which have been
paid as provided in Section 2.07 hereof.




     In determining whether the Holders of the requisite principal amount of Outstanding
Subordinated Securities have given any request, demand, authorization, direction, notice, consent
or waiver hereunder, the principal amount of an Original Issue Discount Subordinated Security that
shall be deemed to be Outstanding for such purposes shall be the amount of the principal thereof
that would be due and payable as of the date of such determination as if a declaration of
acceleration of the maturity thereof pursuant to Section 6.01 had been made.



9









 





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



     “Periodic Offering” means an offering of Subordinated Securities of a series from time to
time, the specific terms of which Subordinated Securities, including, without limitation, the rate
or rates of interest, if any, thereon, the stated maturity or maturities thereof and the redemption
provisions, if any, with respect thereto, are to be determined by the Company or its agents upon
the issuance of such Subordinated Securities.



     “Person” shall mean an individual, a corporation, a partnership, a limited liability company,
a joint venture, an association, a joint stock company, a trust, an unincorporated organization, or
a government or any agency, authority or political subdivision thereof.



     “Predecessor Subordinated Security” of any particular Subordinated Security means every
previous Subordinated Security evidencing all or a portion of the same debt as that evidenced by
such particular Subordinated Security; and, for the purposes of this definition, any Subordinated
Security authenticated and delivered under Section 2.04 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Subordinated Security shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Subordinated Security.



     “principal” whenever used with reference to the Subordinated Securities or any Subordinated
Security or any portion thereof, shall be deemed to include “and premium, if any,” provided,
however, that such inclusion of premium, if any, shall under no circumstances result in the double
counting of such premium for the purpose of any calculation required hereunder.



     “Principal Office of the Trustee” shall mean the office of the Trustee at which at any
particular time the trust created by this Indenture shall be administered, except that with respect
to presentation of Subordinated Securities for payment such term shall mean any office or agency of
the Trustee at which at any particular time its corporate trust services business shall be
conducted. The present address of the Principal Office of the Trustee is administered is 625
Marquette Avenue, Minneapolis, MN 55402, Attention: Corporate Trust Department.



     “Record Date” for the interest payable on any Interest Payment Date on any series of
Subordinated Securities shall mean the date specified as such in the Subordinated Securities of
such series.



     “Register” shall mean the books for the registration and transfer of Subordinated Securities
which books are kept by the Trustee pursuant to Section 2.08.



     “Registered Subordinated Security” means any Subordinated Security registered on the Register
of the Company.



     “Required Currency” shall have the meaning set forth in Section 13.09.



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



     “Senior Indebtedness” means (i) the principal of and premium, if any, and unpaid interest on
indebtedness for money borrowed, (ii) purchase money and similar obligations, (iii) obligations
under capital leases, (iv) guarantees, assumptions or purchase commitments relating to, or other
transactions as a result of which the Company is responsible for the payment of, such indebtedness
of others, (v) renewals, extensions and refunding of any such indebtedness, (vi) interest or
obligations in respect of any such indebtedness accruing after the commencement of any insolvency
or bankruptcy proceedings; and (vii) obligations associated with derivative products such as
interest rate and currency exchange contracts, foreign exchange contracts, commodity contracts, and
similar arrangements, unless, in each case, the instrument by which the Company incurred, assumed
or guaranteed the indebtedness or obligations described in clauses (i) through (vii) hereof
expressly provides that such indebtedness or obligation is subordinate or junior in right or
payment to any other indebtedness or obligation is subordinate or junior in right of payment to any
other indebtedness or obligations of the Company.



10









 





     “Special Record Date” for the payment of any Defaulted Interest means a date fixed by the
Trustee pursuant to Section 2.07.



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



     “Subordinated Indenture” shall mean this instrument as originally executed, or as it may from
time to time be supplemented, modified or amended, as provided herein, and shall include the form
and terms of particular series of Subordinated Securities established in accordance with the
provisions of Sections 2.03 and 2.04.



     “Subordinated Security” or “Subordinated Securities” shall mean any security or securities of
the Company without regard to series, authenticated and delivered under this Subordinated
Indenture.



     “Supplemental Subordinated Indenture” shall mean an indenture supplemental hereto as such
Supplemental Subordinated Indenture may be originally executed, or as it may from time to time be
supplemented, modified or amended, as provided herein and therein.



     “Trustee” shall mean the party named as such in the first paragraph of this Subordinated
Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of
this Subordinated Indenture, and thereafter “Trustee” shall mean such successor Trustee. “Trustee”
shall also 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 Subordinated Securities of any
series shall mean the trustee with respect to the Subordinated Securities of such series.



     “Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended as of the date of
this Subordinated Indenture.



     “United States Dollars” shall mean the lawful currency of the United States of America.



     “U.S. Government Obligations” shall have the meaning set forth in Section 11.01.



     “Yield to Maturity” means the yield to maturity on a series of securities, calculated at the
time of issuance of such series, or, if applicable, at the most recent redetermination of interest
on such series, and calculated in accordance with accepted financial practice.



ARTICLE TWO




ISSUE, DESCRIPTION, EXECUTION, REGISTRATION,

TRANSFER AND EXCHANGE OF SUBORDINATED SECURITIES




     SECTION 2.01. Form of Subordinated Securities and Trustee’s Certificate of
Authentication. The Subordinated Securities of each series shall be substantially in such form
(not inconsistent with this Subordinated Indenture) as shall be established by or pursuant to one
or more Board Resolutions and as set forth in an Officer’s Certificate or Supplemental Subordinated
Indenture, in each case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Subordinated Indenture, and may have such letters,
numbers or other marks of identification or designation and such legends or endorsements thereon as
the Board of Directors may deem appropriate and as are not inconsistent with the provisions of this
Subordinated Indenture, or as may be required to comply with any law or with any rule or regulation
made pursuant thereto or with any rule or regulation of any stock exchange on which the
Subordinated Securities of such series may be listed, or to conform to usage all as may be
determined by the officers executing such Subordinated Securities as evidenced by their execution
of such Subordinated Securities.



     The definitive Subordinated Securities and each Global Subordinated Security may be printed,
lithographed or fully or partly engraved or produced in any other manner, all as determined by the
officers executing such Subordinated Securities as evidenced by their execution thereof.



     SECTION 2.02. Form of Trustee’s Certificate of Authentication. The Trustee’s
certificate of authentication on all Subordinated Securities shall be in substantially the
following form:



11









 





TRUSTEE’S CERTIFICATE OF AUTHENTICATION




     This is one of the Subordinated Securities, of the series designated herein, referred to in
the within—mentioned Subordinated Indenture.



	 	 	 	 	 
	 	Wells Fargo Bank, N.A., as Trustee

 	 
	 	By  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 
	 




     SECTION 2.03. Amount Unlimited, Issuable in Series.



     (a) The aggregate principal amount of Subordinated Securities which may be authenticated and
delivered under this Subordinated Indenture is not limited. The Subordinated Securities may be
issued in one or more series.



     The following terms and provisions of each series of Subordinated Securities shall be
established in or pursuant to one or more Board Resolutions and set forth in an Officer’s
Certificate detailing such establishment or established in one or more Supplemental Subordinated
Indentures prior to the issuance of Subordinated Securities of any series:



          (1) the designation of the series of Subordinated Securities of the series (which shall
distinguish the Subordinated Securities of such series from all other series of Subordinated
Securities) and which may be part of a series of Subordinated Securities previously issued;




          (2) any limit upon the aggregate principal amount of the particular series of Subordinated
Securities which may be executed, authenticated and delivered under this Subordinated Indenture;
provided, however, that nothing contained in this Section 2.03 or elsewhere in this Subordinated
Indenture or in the Subordinated Securities or in an Officer’s Certificate or in a Supplemental
Subordinated Indenture is intended to or shall limit execution by the Company or authentication and
delivery by the Trustee of Subordinated Securities under the circumstances contemplated by Sections
2.08, 2.09, 2.11, 3.03 and 10.04;




          (3) if other than United States Dollars, the coin, currency or currencies or composite
currency in which principal of and interest and any premium on such series of Subordinated
Securities shall be payable (including, but not limited to, any Foreign Currency);




          (4) the Stated Maturity for payment of principal of such series of Subordinated Securities;




          (5) the rate or rates at which such series of Subordinated Securities shall bear interest, if
any, the date or dates from which such interest shall accrue, on which such interest shall be
payable, the terms and conditions of any deferral of interest and the additional interest, if any,
thereon, the right, if any, of the Company to extend the time for payment of interest, the terms
and duration of such extension rights and (in the case of Registered Subordinated Securities) the
date or dates on which a record shall be taken for the determination of Holders to whom interest is
payable and/or the method by which such rate or rates or date or dates shall be determined;




          (6) the place or places where the principal of and any interest on Subordinated Securities of
any series shall be payable, where such Subordinated Securities may be surrendered for registration
of transfer, where such Subordinated Securities may be surrendered for exchange and where notice
and demands to or upon the Company, in respect of such Subordinated Securities, and this
Subordinated Indenture may be served, if other than as provided in Section 4.03;




          (7) the right, if any, of the Company to redeem Subordinated Securities, in whole or in part,
at its option and the period or periods within which, the price or prices at which and any terms
and conditions upon which Subordinated Securities of the series may be so redeemed;




          (8) the obligation, if any, of the Company to redeem, purchase or repay Subordinated
Securities of the series pursuant to any mandatory redemption or analogous provisions or at the
option of a Holder thereof and the price or prices at which and the period or




12









 







periods within which and any terms and conditions upon which Subordinated Securities of the
series shall be redeemed, purchased or repaid, 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 such series of Subordinated Securities shall be issuable;




          (10) the percentage of the principal amount at which the Subordinated Securities will be
issued, and, if other than the principal amount thereof, the portion of the principal amount of
such series of Subordinated Securities which shall be payable upon declaration of acceleration of
the maturity thereof pursuant to Section 6.01;




          (11) if other than the U.S. Dollar, the coin, currency or currencies in which payment of the
principal of or interest on the Subordinated Securities of such series shall be payable, including
composite currencies or currency units and any related provisions for the calculations of payments
and denominations;




          (12) if the principal or interest on the Subordinated Securities of the series are to be
payable, at the election of the Company or a Holder thereof, in a coin or currency other than that
in which the Subordinated Securities are denominated, the period or periods within which, and the
terms and conditions upon which, such election may be made;




          (13) if the amount of payments or principal of and interest on the Subordinated Securities of
the series may be determined with reference to an index or formula based on a coin, currency,
composite currency or currency unit other than that in which the Subordinated Securities of the
series are denominated, the manner in which such amounts shall be determined;




          (14) whether and under what circumstances the Company will pay additional amounts on the
Subordinated Securities of the series held by a person who is not a U.S. person in respect of any
tax, assessment or governmental charge withheld or deducted and, if so, whether the Company will
have the option to redeem the Subordinated Securities of the series rather than pay such additional
amounts;




          (15) if the Subordinated Securities of the series are to be issuable in definitive form
(whether upon original issue or upon exchange of a temporary Subordinated Security of such series)
only upon receipt of certain certificates or other documents or satisfaction of other conditions,
the form and terms of such certificates, documents or conditions;




          (16) any trustees, depositaries, authenticating or paying agents, transfer agents or
registrars of any other agents with respect to the Subordinated Securities of such series;




          (17) any additional events of default or covenants with respect to the Subordinated Securities
of a particular series not set forth herein;




          (18) the terms of subordination applicable to such series of Subordinated Securities;




          (19) the terms and conditions, if any, upon which any Subordinated Securities of such series
may or shall be converted or exchanged into common stock of the Company; and




          (20) any other terms of such series of Subordinated Securities (which terms shall not be
inconsistent with the provisions of this Subordinated Indenture).




     (b) All Subordinated Securities of any one series shall be substantially identical except that
any series may have serial maturities and different interest rates for different maturities and
except in the case of Registered Subordinated Securities as to denomination and the differences
herein specified between Global Subordinated Securities and Registered Subordinated Securities
issued in definitive form and except as may otherwise be provided in or pursuant to such Board
Resolution and set forth in such Officer’s Certificate or Supplemental Subordinated Indenture
relating to such series of Subordinated Securities. All Subordinated Securities of any one series
need not be issued at the same time, and, unless otherwise provided in the Officer’s Certificate or
Supplemental Subordinated Indenture relating to such series, a series may be reopened for issuances
of additional Subordinated Securities of such series.



13









 





     SECTION 2.04. Authentication and Delivery of Subordinated Indentures.



          At any time and from time to time after the execution and delivery of this Subordinated
Indenture, the Company may deliver any series of Subordinated Securities executed by the Company to
the Trustee for authentication by it together with the applicable documents referred to below in
this Section 2.04, and the Trustee shall thereupon authenticate and deliver said Subordinated
Securities (or if only a single Subordinated Security, such Subordinated Security) to or upon the
written order of the Company, signed by an officer of the Company, without any further corporate
action. The maturity date, original issue date, interest rate and any other terms of the
Subordinated Securities of such series shall be determined by or pursuant to such Company Order and
procedures. In authenticating such Subordinated Securities and accepting the additional
responsibilities under this Subordinated Indenture in relation to such Subordinated Securities, the
Trustee shall be entitled to receive (in the case of subparagraphs (2), (3) and (4) below only at
or before the time of the first request of the Company to the Trustee to authenticate Subordinated
Securities of such series) and (subject to Section 7.01) shall be fully protected in relying upon,
the following enumerated documents unless and until such documents have been superseded or revoked:




          (1) a Company Order requesting such authentication and setting forth delivery instructions if
the Subordinated Securities are not to be delivered to the Company, provided that, with respect to
Subordinated Securities of a series subject to a Periodic Offering, (a) such Company Order may be
delivered by the Company to the Trustee prior to the delivery to the Trustee of such Subordinated
Securities for authentication and delivery, (b) the Trustee shall authenticate and deliver
Subordinated Securities of such series for original issue from time to time, in an aggregate
principal amount not exceeding the aggregate principal amount established for such series, pursuant
to a Company Order or pursuant to procedures acceptable to the Trustee as may be specified from
time to time by a Company Order, and (c) the maturity date or dates, original issue date or dates,
interest rate or rates and any other terms of Subordinated Securities of such series shall be
determined by a Company Order or pursuant to such procedures;




          (2) any Board Resolution, Officer’s Certificate and/or executed Supplemental Subordinated
Indenture referred to in Section 2.01 and 2.03 by or pursuant to which the forms and terms of the
Subordinated Securities were established;




          (3) an Officer’s Certificate setting forth the form or forms and terms of the Subordinated
Securities stating that the form or forms and terms of the Subordinated Securities have been
established pursuant to Sections 2.01 and 2.03 and comply with this Subordinated Indenture, and
covering such other matters as the Trustee may reasonably request; and




          (4) either one or more Opinions of Counsel, or a letter addressed to the Trustee permitting it
to rely on one or more Opinions of Counsel, substantially to the effect that:





               (a) the form or forms of the Subordinated Securities have been duly authorized and established
in conformity with the provisions of this Subordinated Indenture;




               (b) the terms of the Subordinated Securities have been duly authorized and established in
conformity with the provisions of this Subordinated Indenture, and, certain terms of the
Subordinated Securities have been established pursuant to a Board Resolution, an Officer’s
Certificate or a Supplemental Subordinated Indenture in accordance with this Subordinated
Indenture, and when such other terms as are to be established pursuant to procedures set forth in a
Company Order shall have been established, all such terms will have been duly authorized by the
Company and will have been established in conformity with the provisions of this Subordinated
Indenture;




               (c) this Indenture and such Subordinated Securities, when executed and issued by the Company
and authenticated by the Trustee in accordance with the provisions of this Subordinated Indenture
and duly paid for by the purchasers thereof, and subject to any conditions specified in such
Opinion of Counsel, will constitute valid and binding obligations of the Company, enforceable in
accordance with their terms, except as any rights thereunder may be limited by the effect of
bankruptcy, insolvency, reorganization, receivership, conservatorship, arrangement, moratorium or
other laws affecting or relating to the rights of creditors generally; the rules governing the
availability of specific performance, injunctive relief or other equitable remedies and general
principles of equity, regardless of whether considered in a proceeding in equity or at law; the
effect of applicable court decisions invoking statutes or principles of equity, which have held
that certain covenants and provisions of agreements are unenforceable where the breach of such
covenants or provisions imposes restrictions or burdens upon a borrower, and it cannot be
demonstrated that the enforcement of such restrictions or burdens is necessary for the protection
of the creditor, or which have held that the creditor’s enforcement of such covenants or provisions
under the circumstances would have violated the creditor’s covenants of good faith and fair dealing
implied



14









 




under California law; and the effect of California statutes and rules of law which cannot be
waived prospectively by a borrower, and such counsel need express no opinion with regard to the
enforceability of Section 7.06 or of a judgment denominated in a currency other than United States
Dollars; and





               (d) the Company has complied with all applicable Federal laws and requirements in respect of
the execution and delivery of such Subordinated Securities; and




               (e) such other opinions as the Company may be required to deliver under the TIA.



          (5) if the Securities are to be secured, a supplemental indenture conforming to the
requirements of Section 314 of the Trust Indenture Act and such other documents as may be required
by Section 314; and




          (6) if the Securities are to be convertible, a supplemental indenture conforming to the
requirements of Section 314 of the Trust Indenture Act and such other documents as may be required
by Section 314.




          In rendering such opinions, any counsel may qualify any opinions as to enforceability by
stating that such enforceability may be limited by bankruptcy, insolvency, reorganization,
liquidation, moratorium, fraudulent transfer and other similar laws affecting the rights and
remedies of creditors and is subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law). Such counsel may rely upon
opinions of other counsel (copies of which shall be delivered to the Trustee) reasonably
satisfactory to the Trustee, in which case the opinion shall state that such counsel believes he
and the Trustee are entitled so to rely. Such counsel may also state that, insofar as such opinion
involves factual matters, he has relied, to the extent he deems proper, upon certificates of
officers of the Company and its subsidiaries and certificates of public officials.




          The Trustee shall have the right to decline to authenticate and deliver any Subordinated
Securities under this section if the Trustee, being advised by counsel, determines that such action
may not lawfully be taken by the Company or if the Trustee in good faith by its board of directors
or board of trustees, executive committee or a trust committee of directors or trustees shall
determine that such action would expose the Trustee to personal liability to existing Holders or
would affect the Trustee’s own rights, duties or immunities under the Subordinated Securities, this
Subordinated Indenture or otherwise.




     SECTION 2.05. Execution of Subordinated Securities. The Subordinated Securities shall
be executed manually or in facsimile, by any two of the Chairman of the Board, Chief Executive
Officer, the President, and Vice President, the Secretary, the Chief Financial Officer, or the
Treasurer of the Company under its corporate seal which may be affixed thereto or printed, engraved
or otherwise reproduced thereon, by facsimile or otherwise. Only such Subordinated Securities as
shall bear thereon a certificate of authentication substantially in the form recited herein,
executed by the Trustee manually by an authorized officer, shall be entitled to the benefits of
this Subordinated Indenture or be valid or obligatory for any purpose. Such certificate of
authentication of the Trustee upon any Subordinated Security executed by the Company shall be
conclusive evidence that the Subordinated Security so authenticated has been duly authenticated and
delivered hereunder and that the Holder is entitled to the benefits of this Subordinated Indenture.
Typographical or other errors or defects in the seal or facsimile signature on any Subordinated
Security or in the text thereof shall not affect the validity or enforceability of such
Subordinated Security if it has been duly authenticated and delivered by the Trustee.



     In case any officer of the Company who shall have signed any of the Subordinated Securities
(manually or in facsimile) shall cease to be such officer before the Subordinated Securities so
signed shall have been authenticated and delivered by the Trustee, or disposed of by the Company,
such Subordinated Securities nevertheless may be authenticated and delivered or disposed of as
though the Person who signed such Subordinated Securities had not ceased to be such officer of the
Company. Also, any Subordinated Security may be signed on behalf of the Company by such Persons as
on the actual date of execution of such Subordinated Security shall be the proper officers of the
Company, although at the date of the execution of this Subordinated Indenture or on the nominal
date of such Subordinated Security any such Person was not such officer.



     SECTION 2.06. Certificate of Authentication. Only such Subordinated Securities as
shall bear thereon a certificate of authentication substantially in the form hereinbefore recited,
executed by the Trustee by the manual signature of one of its authorized officers, shall be
entitled to the benefits of this Subordinated Indenture or be valid or obligatory for any purpose.
The execution of such certificate by the Trustee upon any Subordinated Security executed by the
Company shall be conclusive evidence that the Subordinated Security so authenticated has been duly
authenticated and delivered hereunder and that the Holder is entitled to the benefits of this
Subordinated Indenture.



15









 





     SECTION 2.07. Denominations; Payment of Interest on Subordinated Securities.



     (a) The Subordinated Securities of each series may be issued in such denominations as shall be
specified as contemplated by Section 2.03. In the absence of such provisions with respect to the
Subordinated Securities of any series, the Subordinated Securities of such series shall be issued
in denominations of $1,000 and any integral multiple thereof. The Subordinated Securities of each
series shall be numbered, lettered or otherwise distinguished in such manner or in accordance with
such plan as the officers of the Company executing the same may determine.



     (b) If the Subordinated Securities of any series shall bear interest, each Subordinated
Security of such series shall bear interest from the applicable date at the rate per annum
specified in the Officer’s Certificate or Supplemental Subordinated Indenture with respect to such
series of Subordinated Securities. Unless otherwise specified in the Officer’s Certificate or
Supplemental Subordinated Indenture with respect to the Subordinated Securities of any series,
interest on the Subordinated Securities of such series shall be computed on the basis of a 360—day
year of twelve 30—day months. Such interest shall be payable on the Interest Payment Dates
specified in the Officer’s Certificate or Supplemental Subordinated Indenture with respect to such
series of Subordinated Securities. The Person in whose name any Subordinated Security (or one or
more Predecessor Subordinated Securities) is registered at the close of business on the applicable
Record Date for the series of which such Subordinated Security is a part shall be entitled to
receive the interest payable thereon on such Interest Payment Date notwithstanding the cancellation
of such Subordinated Security upon any transfer or exchange thereof subsequent to such Record Date
and prior to such Interest Payment Date unless such Subordinated Security shall have been called
for redemption on a Redemption Date which is subsequent to such Record Date and prior to such
Interest Payment Date or unless the Company shall default in the payment of interest due on such
Interest Payment Date on any Subordinated Security of such series.



     Any interest on any Subordinated 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 registered Holder on the relevant Record Date
solely by virtue of such Holder 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:



     (1) The Company may elect to make payment of any Defaulted Interest on the Subordinated
Securities of any series to the Persons in whose names such Subordinated Securities (or their
respective Predecessor Subordinated 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 Subordinated Security and the date of the proposed payment
(which date shall be such as will enable the Trustee to comply with the next sentence hereof), 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, such money when
deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as
in this subsection provided. Thereupon the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest which shall be not more than 15 nor 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 a Subordinated Security of such series at such Holder’s address as it
appears in the 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 mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names the Subordinated
Securities of such series are registered on such Special Record Date and shall no longer be payable
pursuant to the following subsection (2).



     (2) The Company may make payment of any Defaulted Interest on the Subordinated Securities of
any series in any other lawful manner not inconsistent with the requirements of any securities
exchange on which such Subordinated 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 subsection, such payment shall be deemed practicable by the Trustee.



     Interest on Subordinated Securities of any series that bear interest may be paid by mailing a
check to the address of the person entitled thereto as such address shall appear in the Register.



16









 





     Subject to the foregoing provisions of this Section 2.07, each Subordinated Security delivered
under this Subordinated Indenture upon transfer of or in exchange for or in lieu of any other
Subordinated Security shall carry all the rights to interest accrued and unpaid, and to accrue,
which were carried by such other Subordinated Security and each such Subordinated Security shall
bear interest from such date, such that neither gain nor loss in interest shall result from such
transfer, exchange or substitution.



     SECTION 2.08. Registration, Transfer and Exchange of Subordinated Securities. Except
as specifically otherwise provided herein with respect to Global Subordinated Securities,
Subordinated Securities of any series may be exchanged for a like aggregate principal amount of
Subordinated Securities of the same series of other authorized denominations. Subordinated
Securities to be exchanged shall be surrendered at the offices or agencies to be maintained in
accordance with the provisions of Section 4.03 and the Company shall execute the Subordinated
Security or Subordinated Securities, and the Trustee shall authenticate and deliver in exchange
therefor the Subordinated Security or Subordinated Securities which the Subordinated Securityholder
making the exchange shall be entitled to receive.



     The Company shall cause the Trustee to keep or cause to be kept, at one or more of the offices
or agencies to be maintained by the Trustee in accordance with the provisions of Section 4.03 with
respect to the Subordinated Securities of each series, the Register in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the registration of the
Registered Subordinated Securities of such series and the transfer of Registered Subordinated
Securities of such series as in this Article provided. The Register shall be in written form or in
any other form capable of being converted into written form within a reasonable time. At all
reasonable times the Register shall be open for inspection by the Trustee and any registrar of the
Subordinated Securities of such series other than the Trustee. Upon due presentment for transfer of
any Subordinated Security of any series at the offices or agencies of the Company to be maintained
in accordance with Section 4.03 with respect to the Registered Subordinated Securities of such
series, the Company shall execute a new Subordinated Security and the Trustee shall authenticate
and deliver in the name of the transferee or transferees a new Subordinated Security or Registered
Subordinated Securities of the same series for a like aggregate principal amount of authorized
denominations. Notwithstanding any other provisions of this Section 2.08, unless and until it is
exchanged in whole or in part for Registered Subordinated Securities in definitive form, a Global
Subordinated Security representing all or a portion of the Registered Subordinated Securities of a
series may not be transferred except as a whole by the Depository for such series to a nominee of
such Depository or by a nominee of such Depository to such Depository or another nominee of such
Depository or by such Depository or any such nominee to a successor Depository for such series or a
nominee of such successor Depository.



     At the option of the Holder thereof, Registered Subordinated Securities of any series (other
than a Global Subordinated Security, except as set forth below) may be exchanged for a Registered
Subordinated Security or Registered Subordinated Securities of such series and tenor having
authorized denominations and an equal aggregate principal amount, upon surrender of such Registered
Subordinated Securities to be exchanged at the agency of the Company that shall be maintained for
such purpose in accordance with Section 4.03 and upon payment, if the Company shall so require, of
the charges hereinafter provided. All Subordinated Securities surrendered upon any exchange or
transfer provided for in this Subordinated Indenture shall be promptly cancelled and disposed of by
the Trustee, and the Trustee shall deliver a certificate of disposition thereof to the Company.



     All Registered Subordinated Securities of any series presented or surrendered for exchange,
transfer, redemption, conversion or payment shall, if so required by the Company or any registrar
of the Subordinated Securities of such series, be accompanied by a written instrument or
instruments of transfer, in form satisfactory to the Company and such registrar, duly executed by
the registered Holder or by such Person’s attorney duly authorized in writing.



     No service charge shall be made for any exchange or registration of transfer of Subordinated
Securities, but the Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto.



     The Company shall not be required to exchange or transfer (a) any Subordinated Securities of
any series during a period beginning at the opening of business 15 days before the day of the first
publication or the mailing (if there is no publication) of a notice of redemption of Subordinated
Securities of such series and ending at the close of business on the day of such publication or
mailing or (b) any Subordinated Securities called or selected for redemption in whole or in part,
except, in the case of Subordinated Securities called for redemption in part, the portion thereof
not so called for redemption in whole or in part or during a period beginning at the opening of
business on any Record Date for such series and ending at the close of business on the relevant
Interest Payment Date therefor.



17









 





     SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Subordinated Securities.
In case any temporary or definitive Subordinated Security shall be mutilated, defaced, destroyed,
lost or stolen, the Company in its discretion may execute and, upon the written request of any
officer of the Company, the Trustee shall authenticate and delivery, a new Subordinated Security of
the same series, maturity date, interest rate and original issue date, bearing a number or other
distinguishing symbol not contemporaneously outstanding, in exchange and substitution for the
mutilated or defaced Subordinated Security, or in lieu of and in substitution for the Subordinated
Security so destroyed, lost or stolen. In every case the applicant for a substitute Subordinated
Security shall furnish to the Company and to the Trustee and any agent of the Company or the
Trustee such security or indemnity as may be required by them to indemnify and defend and to save
each of them harmless and, in every case of destruction, loss or theft, evidence to their
satisfaction of the destruction, loss or theft of such Subordinated Security and of the ownership
thereof, and in the case of mutilation or defacement shall surrender the Subordinated Security to
the Trustee or such agent. If the Company becomes aware that such Security has been acquired by a
bona fide purchaser, it shall notify the Trustee in writing.



     Upon the issuance of any substitute Subordinated Security, 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) or its agent
connected therewith. In case any Subordinated Security which has matured or is about to mature or
has been called for redemption in full shall become mutilated or defaced or be destroyed, lost or
stolen, the Company may instead of issuing a substitute Subordinated Security, pay or authorize the
payment of the same (without surrender thereof except in the case of a mutilated or defaced
Subordinated Security, if the applicant for such payment shall furnish to the Company and to the
Trustee and any agent of the Company or the Trustee such security or indemnity as any of them may
require to save each of them harmless, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Company and to the Trustee and any agent of the Company or the
Trustee evidence to their satisfaction of the destruction, loss or theft of such Subordinated
Security and of the ownership thereof.



     Every substitute Subordinated Security of any series issued pursuant to the provisions of this
Section by virtue of the fact that any such Subordinated Security is destroyed, lost or stolen
shall constitute an additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Subordinated Security shall be at any time enforceable by anyone and shall be
entitled to all the benefits of (but shall be subject to all the limitations of rights set forth
in) this Subordinated Indenture equally and proportionately with any and all other Subordinated
Securities of such series duly authenticated and delivered hereunder. All Subordinated Securities
shall be held and owned upon the express condition that, to the extent permitted by law, the
foregoing provisions are exclusive with respect to the replacement or payment of mutilated, defaced
or destroyed, lost or stolen Subordinated Securities and shall preclude any and all other rights or
remedies notwithstanding any law or statue existing or hereafter enacted to the contrary with
respect to the replacement or payment of negotiable instruments or other securities without their
surrender.



     SECTION 2.10. Cancellation and Destruction of Surrendered Subordinated Securities. All
Subordinated Securities surrendered for payment, redemption, transfer, conversion or exchange, or
for credit against any payment in respect of a sinking or analogous fund, if any, shall, if
surrendered to the Company, the Trustee or any agent of the Company or of the Trustee, be delivered
to the Trustee, and the same, together with Subordinated Securities surrendered to the Trustee for
cancellation, shall be canceled by it and thereafter disposed of by it as directed by the Company,
and no Subordinated Securities shall be issued in lieu thereof except as expressly permitted by any
of the provisions of this Subordinated Indenture. The Trustee shall destroy canceled Subordinated
Securities in accordance with applicable laws and procedures, and deliver a certificate of
destruction thereof to the Company. If the Company shall purchase or otherwise acquire any of the
Subordinated Securities, however, such purchase or acquisition shall not operate as a payment,
redemption or satisfaction of the indebtedness represented by such Subordinated Securities unless
and until the Company, at its option shall deliver or surrender the same to the Trustee for
cancellation.



     SECTION 2.11. Temporary Subordinated Securities. Pending the preparation of definitive
Subordinated Securities of any series, the Company may execute and the Trustee shall authenticate
and deliver temporary Subordinated Securities of such series which are printed, lithographed,
typewritten or otherwise produced, in each case satisfactory to the Trustee. Temporary Subordinated
Securities of any series shall be issuable substantially in the form of the definitive Subordinated
Securities of such series but with such appropriate omissions, insertions, substitutions and other
variations as the officers executing such Subordinated Securities may determine, as evidenced by
their execution of such Subordinated Securities. Every such temporary Subordinated Security shall
be authenticated by the Trustee upon the same conditions and in substantially the same manner, and
with the same effect, as the definitive Subordinated Securities. If temporary Subordinated
Securities are issued, the Company will cause definitive Subordinated Securities to be prepared
without unreasonable delay. After the preparation of definitive Subordinated Securities, the
temporary Subordinated Securities of such series shall be exchangeable for definitive Subordinated
Securities upon surrender of the temporary Subordinated



18









 




Securities without charge to the Holder at the offices or agencies to be maintained by the
Trustee as provided in Section 4.03 with respect to the Subordinated Securities of such series.



Upon surrender for cancellation of any one or more temporary Subordinated Securities the Company
shall execute and the Trustee shall authenticate and deliver in exchange for such temporary
Subordinated Securities an equal aggregate principal amount of definitive Subordinated Securities
of such series. Until so exchanged, the temporary Subordinated Securities of any series shall in
all respects be entitled to the benefits of this Subordinated Indenture and interest thereon, when
and as payable, shall be paid to the registered owners thereof.




     SECTION 2.12. Subordinated Securities in Global Form.



     (a) If the Company shall establish pursuant to Section 2.01 that the Securities of a
particular series are to be issued as a Global Security, then the Company shall execute and the
Trustee shall, in accordance with Section 2.04, authenticate and deliver, a Global Security that
(i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount
of, all of the Outstanding Subordinated Securities of such series, (ii) shall be registered in the
name of the Depository or its nominee, (iii) shall be held by the Trustee as custodian for the
Depository or pursuant to the Depository’s instruction and (iv) shall bear a legend substantially
to the following effect: “Except as otherwise provided in Section 2.12 of the Indenture, this
Security may be transferred, in whole but not in part, only to another nominee of the Depository or
to a successor Depository or to a nominee of such successor Depository.”



     (b) Notwithstanding the provisions of Section 2.05, the Global Subordinated Security of a
series may be transferred, in whole but not in part and in the manner provided in Section 2.08,
only to another nominee of the Depository for such series, or to a successor Depository for such
series selected or approved by the Corporation or to a nominee of such successor Depository.



     (c) If at any time the Depository for a series of the Subordinated Securities notifies the
Company that it is unwilling or unable to continue as Depository for such series or if at any time
the Depository for such series shall no longer be registered or in good standing under the Exchange
Act, or other applicable statute or regulation, and a successor Depository for such series is not
appointed by the Company within 90 days after the Company receives such notice or becomes aware of
such condition, as the case may be, or if an Event of Default has occurred and is continuing and
the Company has received a request from the Depositary, this Section 2.10 shall no longer be
applicable to the Securities of such series and the Company will execute and subject to Section
2.04, the Trustee will authenticate and deliver the Subordinated Securities of such series in
definitive registered form without coupons, in authorized denominations, and in an aggregate
principal amount equal to the principal amount of the Global Subordinated Security of such series
in exchange for such Global Subordinated Security or Subordinated Securities upon the instruction
of the Depository. In addition, the Company may at any time determine that the Subordinated
Securities of any series shall no longer be represented by a Global Subordinated Security and that
the provisions of this Section 2.12 shall no longer apply to the Securities of such series. In
such event, the Company will execute and, subject to Section 2.04, the Trustee, upon receipt of an
Officers’ Certificate evidencing such determination by the Company, will authenticate and deliver
the Subordinated Securities of such series in definitive registered form without coupons, in
authorized denominations, and in an aggregate principal amount equal to the principal amount of the
Global Subordinated Security of such series in exchange for such Global Subordinated Security.
Upon the exchange of the Global Subordinated Security for such Subordinated Securities in
definitive registered form without coupons, in authorized denominations, the Global Subordinated
Security shall be canceled by the Trustee.



     Such Subordinated Securities in definitive registered form issued in exchange for the Global
Subordinated Security pursuant to this Section 2.10(c) shall be registered in such names and in
such authorized denominations as the Depository, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee. The Trustee shall deliver such
Debt Securities to the Depository for delivery to the Persons in whose names such Securities are so
registered.



     SECTION 2.13. CUSIP Numbers. The Company in issuing the Subordinated Securities may
use “CUSIP” and “CINS” numbers (if then generally in use), and the Trustee shall use CUSIP numbers
or CINS numbers, as the case may be, in notices of redemption or exchange as a convenience to
Holders and no representation shall be made as to the correctness of such numbers either as printed
on the Subordinated Securities or as contained in any notice of redemption or exchange. The
Company will promptly notify the Trustee of any change in the “CUSIP” and/or such other numbers.



19









 





ARTICLE THREE




REDEMPTION OF SUBORDINATED SECURITIES




     SECTION 3.01. Applicability of Article. The provisions of this Article shall be
applicable to the Subordinated Securities of any series which are redeemable before their Stated
Maturity except as otherwise specified as contemplated by Section 2.03 for Subordinated Securities
of such series.



     SECTION 3.02. Notice of Redemption; Partial Redemptions. Notice of redemption to the
Holders of Registered Subordinated Securities of any series to be redeemed as a whole or in part at
the option of the Company shall be given by mailing notice of such redemption by electronic
transmission, first-class mail, postage prepaid, at least 30 days and not more than 60 days prior
to the date fixed for redemption to such Holders of Subordinated Securities of such series at their
last addresses as they shall appear upon the Register.



Any notice which is mailed in the manner herein provided shall be conclusively presumed to have
been duly given, whether or not the Holder receives the notice. Failure to give notice by mail, or
any defect in the notice to the Holder of any Subordinated Security of a series designated for
redemption as a whole or in part shall not affect the validity of the proceedings for the
redemption of such Subordinated Security of such series.



     The notice of redemption to each such Holder shall specify the principal amount of each
Subordinated Security of such series held by such Holder to be redeemed, the date fixed for
redemption, the redemption price, the place or places of payment, that payment will be made upon
presentation and surrender of such Subordinated Securities, that interest accrued to the date fixed
for redemption will be paid as specified in such notice and that on and after said date interest
thereon or on the portions thereof to be redeemed will cease to accrue. In case any Subordinated
Security of a series is to be redeemed in part only the notice of redemption shall state the
portion of the principal amount thereof to be redeemed and shall state that on and after the date
fixed for redemption, upon surrender of such Subordinated Security, a new Subordinated Security or
Subordinated Securities of such series in principal amount equal to the unredeemed portion thereof
will be issued.



     The notice of redemption of Subordinated Securities of any series to be redeemed at the option
of the Company shall be given by the Company or, at the Company’s request delivered to the Trustee
at least five Business Days prior to the intended date of mailing to the Holders, by the Trustee in
the name and at the expense of the Company.



     On or before the redemption date specified in the notice of redemption given as provided in
this Section, the Company will deposit with the Trustee or with one or more Paying Agents (or, if
the Company is acting as its own Paying Agent, set aside, segregate and holder in trust as provided
in Section 4.05), no later than 11:00 a.m. New York City time, an amount of money sufficient to
redeem on the redemption date all the Subordinated Securities of such series so called for
redemption at the appropriate redemption price, together with accrued interest to the date fixed
for redemption. The Company will deliver to the Trustee at least 70 days prior to the date fixed
for redemption, or such shorter period as shall be acceptable to the Trustee, an Officer’s
Certificate stating the aggregate principal amount of Subordinated Securities to be redeemed with a
copy of the form on notice to the Holders setting forth the information required by this Section
3.02. In case of a redemption at the election of the Company prior to the expiration of any
restriction on such redemption, the Company shall deliver to the Trustee, prior to the giving of
any notice of redemption to Holders pursuant to this Section, an Officer’s Certificate stating that
such restriction has been complied with.



     If less than all the Subordinated Securities of a series are to be redeemed, the Trustee shall
select, in such manner as it shall deem appropriate and fair, in its sole discretion, Subordinated
Securities of such series to be redeemed in whole or in part. Subordinated Securities may be
redeemed in part in multiples equal to the minimum authorized denomination for Subordinated
Securities of such series or any multiple thereof. The Trustee shall promptly notify the Company in
writing of the Subordinated Securities of such series selected for redemption and, in the case of
any Subordinated Securities of such series selected for partial redemption, the principal amount
thereof to be redeemed. For all purposes of this Subordinated Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Subordinated Securities of any
series shall relate, in the case of any Subordinated Security redeemed or to be redeemed only in
part, to the portion of the principal amount of such Subordinated Security which has been or is to
be redeemed.



     SECTION 3.03. Payment of Subordinated Securities Called for Redemption. If notice of
redemption has been given as above provided, the Subordinated Securities or portions of
Subordinated Securities specified in such notice shall become due and payable on



20









 




the date and at the place stated in such notice at the applicable redemption price, together
with interest accrued to the date fixed for redemption, and on and after said date (unless the
Company shall default in the payment of such Subordinated Securities at the redemption price,
together with interest accrued to said date) interest on the Subordinated Securities or portions of
Subordinated Securities so called for redemption shall cease to accrue, and, except as provided in
Sections 7.05 and 11.04, such Subordinated Securities shall cease from and after the date fixed for
redemption to be entitled to any benefit or security under this Subordinated Indenture, and the
Holders thereof shall have no right in respect of such Subordinated Securities except the right to
receive the redemption price thereof and unpaid interest to the date fixed for redemption. On
presentation and surrender of such Subordinated Securities at a place of payment specified in said
notice, said Subordinated Securities or the specified portions thereof shall be paid and redeemed
by the Company at the applicable redemption price, together with interest accrued thereon to the
date fixed for redemption; provided, that payment of interest becoming due on or prior to the date
fixed for redemption shall be payable to the Holder of such Registered Subordinated Securities
registered as such on the relevant record date, subject to the terms and provisions of Section 2.03
and 2.07 hereof.




     If any Subordinated Security called for redemption shall not be so paid upon surrender thereof
for redemption, the principal shall, until paid or duly provided for, bear interest from the date
fixed for redemption at the rate of interest or Yield to Maturity (in the case of an Original Issue
Discount Subordinated Security) borne by such Subordinated Security.



     Upon presentation of any Subordinated Security redeemed in part only, the Company shall
execute and the Trustee shall authenticate and deliver to or on the order of the Holder thereof, at
the expense of the Company, a new Subordinated Security or Subordinated Securities of such series,
of authorized denominations, in principal amount equal to the unredeemed portion of the
Subordinated Security so presented.



     SECTION 3.04. Exclusion of Certain Subordinated Securities From Eligibility for Selection
for Redemption. Subordinated Securities shall be excluded from eligibility for selection for
redemption if they are identified by registration and certificate number in an Officer’s
Certificate delivered to the Trustee at least 40 days prior to the last date on which notice of
redemption may be given as being owned of record and beneficially by, and not pledged or
hypothecated by, either (a) the Company or (b) an entity specifically identified in such written
statement as directly or indirectly controlling or controlled by or under direct or indirect common
control with the Company.



ARTICLE FOUR




PARTICULAR COVENANTS OF THE COMPANY




     SECTION 4.01. Payment of Principal of and Interest on Subordinated Securities. The
Company covenants that it will duly and punctually pay or cause to be paid the principal of and any
interest and premium on each of the Subordinated Securities in accordance with the terms of the
Subordinated Securities and this Subordinated Indenture. Except with respect to any Global
Subordinated Securities, if the Subordinated Securities of any series bear interest, each
installment of interest on the Subordinated Securities of such series may, at the option of the
Company, be paid by mailing a check or checks for such interest payable to the Person entitled
thereto pursuant to Section 2.07 to the address of such Person as it appears on the Register of
such series on the applicable Record Date for such interest payment. The interest, if any, on
Registered Securities (together with any additional amounts payable pursuant to the terms of such
Securities) shall be payable only to or upon the written order of the Holders thereof and, at the
option of the Company, may be paid by wire transfer or by mailing checks for such interest payable
to or upon the written order of such Holders at their last addresses as they appear on the Register
of the Company.



     SECTION 4.02. Corporate Existence of the Company; Consolidation, Merger, Sale or
Transfer. The Company covenants that so long as any of the Subordinated Securities are
Outstanding, it will maintain its existence, will not dissolve, sell or otherwise dispose of all or
substantially all of its assets and will not consolidate with or merge into another entity or
permit one or more other entities to consolidate with or merge into it; provided that the Company
may, without violating the covenants in this Section 4.02 contained, consolidate with or merge into
another entity or permit one or more other entities to consolidate with or merge into it, or sell
or otherwise transfer to another entity all or substantially all of its assets as an entirety and
thereafter dissolve, if the surviving, resulting or transferee entity, as the case may be, (i)
shall be organized and existing under the laws of one of the States of the United States of
America, (ii) assumes, if such entity is not the Company, all of the obligations of the Company
hereunder and (iii) is not, after such transaction, otherwise in default under any provisions
hereof.



21









 





     SECTION 4.03. Maintenance of Offices or Agencies for Transfer, Registration, Exchange and
Payment of Subordinated Securities. So long as any of the Subordinated Securities shall remain
Outstanding, the Company covenants that it will cause the Trustee to maintain an office or agency
in Minneapolis, MN, where the Subordinated Securities may be presented for registration, exchange
and transfer as in this Subordinated Indenture provided, and where notices and demands to or upon
the Trustee in respect of the Subordinated Securities or of this Subordinated Indenture may be
served, and where the Subordinated Securities may be presented for payment. In case the Trustee
shall fail to maintain any such office or agency, presentations and demands may be made and notices
may be served at the principal office of the Company.



     The Company will give to the Trustee written notice of the location of each such office or
agency and of any change of location thereof. In case the Company shall fail to maintain any agency
required by this Section to be located in the Minneapolis, MN, or shall fail to give such notice of
the location or for any change in the location of any of the above agencies, presentations and
demands may be made and notices may be served at the Principal Office of the Trustee.



     The Company may from time to time designate one or more additional offices or agencies where
the Subordinated Securities of a series may be presented for payment, where the Subordinated
Securities of that series may be presented for exchange as provided in this Subordinated Indenture
and pursuant to Section 2.04 and where the Registered Subordinated Securities of that series may be
presented for registration of transfer as in this Subordinated Indenture provided, and the Company
may from time to time rescind any such designation, as the Company may deem desirable or expedient;
provided, that no such designation or rescission shall in any manner relieve the Company of its
obligations to maintain the agencies provided for in this Section. The Company shall give to the
Trustee prompt written notice of any such designation or rescission thereof.



     SECTION 4.04. Appointment to Fill a Vacancy in the Office of Trustee. The Company,
whenever necessary to avoid or fill a vacancy in the office of Trustee, covenants that it will
appoint, in the manner provided in Section 7.10, a Trustee, so that there shall at all times be a
Trustee with respect to the Outstanding Subordinated Securities.



     SECTION 4.05. Duties of Paying Agent. (a) If the Company shall appoint a Paying Agent
other than the Trustee with respect to Subordinated Securities of any series, it will cause such
Paying Agent to execute and deliver to the Trustee an instrument in which such agent shall agree
with the Trustee, subject to the provisions of this Section 4.05 and Section 11.04,



          (1) that it will hold all sums held by it as such agent for the payment of the principal of or
interest, if any, on the Subordinated Securities of such series (whether such sums have been paid
to it by the Company or by any other obligor on the Subordinated Securities of such series) in
trust for the benefit of the Holders of the Subordinated Securities entitled to such principal or
interest and will notify the Trustee of the receipt of sums to be so held,




          (2) that it will give the Trustee notice of any failure by the Company (or by any other
obligor on the Subordinated Securities of such series) to make any payment of the principal of or
interest on the Subordinated Securities of such series when the same shall be due and payable, and




          (3) that it will at any time during the continuance of any Event of Default, upon the written
request of the Trustee, deliver to the Trustee all sums so held in trust by it.




     (b) Whenever the Company shall have one or more Paying Agents with respect to the Subordinated
Securities of any series, it will, prior to each due date of the principal of or any interest on
the Subordinated Securities of such series, deposit with a Paying Agent of such series a sum
sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the
benefit of the Holders of Subordinated Securities entitled to such principal or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its
action or failure so to act.



     (c) If the Company shall act as its own Paying Agent with respect to the Subordinated
Securities of any series, it will, on or before each due date of the principal of or interest on
the Subordinated Securities of such series, set aside, segregate and hold in trust for the benefit
of the Holders of the Subordinated Securities of such series a sum sufficient to pay such principal
or interest so becoming due. The Company will promptly notify the Trustee of any failure to take
such action.



     (d) Anything in this Section 4.05 to the contrary notwithstanding, the Company may, at any
time, for the purpose of obtaining a satisfaction and discharge of this Subordinated Indenture with
respect to one or more or all series of Subordinated Securities



22









 




hereunder, or for any other reason, pay or cause to be paid to the Trustee all sums held in
trust for such series by it, or any Paying Agent hereunder, as required by this Section 4.05, and
such sums are to be held by the Trustee upon the trust herein contained.




     SECTION 4.06. Notice of Default. The Company covenants that, as soon as is practicable
but in no event later than twenty Business Days after the occurrence thereof, the Company will
furnish the Trustee notice of any event which is an Event of Default or which with the giving of
notice or the passage of time or both would constitute an Event of Default which has occurred and
is continuing on the date of such notice, which notice shall set forth the nature of such event and
the action which the Company proposes to take with respect thereto.



     SECTION 4.07. Maintenance of Properties. The Company will cause all properties used in
or useful in the conduct of its business to be maintained and kept in good condition, repair, and
working order and supplied with all necessary equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all time except to the extent that the Company may be
prevented from so doing by circumstances beyond its control; provided, that nothing in this Section
shall prevent the Company from discontinuing the operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal is, in the judgment of
the Company desirable in the conduct of the business of the Company and not disadvantageous in any
material respect to the Subordinated Securityholders.



     SECTION 4.08. Payment of Taxes and Other Claims. The Company will pay or discharge or
cause to be paid or discharged, before the same shall become delinquent: (a) all taxes, assessments
and governmental charges levied or imposed upon the Company or upon the income, profits or property
of the Company; and (b) all lawful claims for labor, materials, and supplies, which, if unpaid,
might by law become a lien upon the property of the Company; provided, that the Company shall not
be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge
or claim whose amount, applicability or validity is being contested in good faith by appropriate
proceedings; and provided further that the Company shall not be required to cause to be paid or
discharged any such tax, assessment, charge or claim if the Company shall determine that such
payment is not advantageous to the conduct of the business of the Company taken as a whole and that
the failure so to pay or discharge is not disadvantageous in any material respect to the
Subordinated Securityholders.



ARTICLE FIVE




SUBORDINATED SECURITYHOLDERS’ LISTS AND REPORTS

BY THE COMPANY AND THE TRUSTEE




     SECTION 5.01. Company to Furnish Trustee Information as to the Names and Addresses of
Subordinated Securityholders. The Company will furnish or cause to be furnished to the Trustee,
not less than 45 days nor more than 60 days after each date (month and day) specified as an
Interest Payment Date for the Subordinated Securities of the first series issued under this
Subordinated Indenture (whether or not any Subordinated Securities of that series are then
Outstanding), but in no event less frequently than semiannually, and at such other times as the
Trustee may request in writing, within 30 days after receipt by the Company of any such request, a
list in such form as the Trustee may reasonably require containing all the information in the
possession or control of the Company, or any of its Paying Agents other than the Trustee, as to the
names and addresses of the Holders of Subordinated Securities, obtained since the date as of which
the next previous list, if any, was furnished, excluding from any such list the names and addresses
received by the Trustee in its capacity as registrar (if so acting). Any such list may be dated as
of a date not more than 15 days prior to the time such information is furnished and need not
include information received after such date. However, if the Trustee is appointed as Registrar,
the Company has no obligation to furnish the list of holders.



     SECTION 5.02. Preservation of Information; Communication to Subordinated
Securityholders. (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of the Holders of Subordinated Securities of each series (1)
contained in the most recent list furnished to it as provided in Section 5.01, (2) received by the
Trustee in the capacity of Paying Agent or registrar (if so acting) and (3) filed with the Trustee
within the two preceding years as provided for in Section 5.04(c). The Trustee may destroy any list
furnished to it as provided in Section 5.01 upon receipt of a new list so furnished.



     (b) If three or more Holders of Subordinated Securities (hereinafter referred to as
“applicants”) apply in writing to the Trustee, and furnish to the Trustee reasonable proof that
each such applicant has owned a Subordinated Security for a period of at least six months preceding
the date of such application, and such application states that the applicants desire to communicate
with other Holders of



23









 




Subordinated Securities of any series or with Holders of all Subordinated Securities with
respect to their rights under this Subordinated Indenture or under such Subordinated Securities,
and is accompanied by a copy of the form of proxy or other communication which such applicants
propose to transmit, then the Trustee shall, within five Business Days after the receipt of such
application, at its election, either:




          (1) afford such applicants access to the information preserved at the time by the Trustee in
accordance with the provisions of subsection (a) of this Section 5.02; or




          (2) inform such applicants as to the approximate number of Holders of Subordinated Securities
of such series or all Subordinated Securities, as the case may be, whose names and addresses appear
in the information preserved at the time by the Trustee in accordance with the provisions of
subsection (a) of this Section 5.02, and as to the approximate cost of mailing to such Subordinated
Securityholders the form of proxy or other communications, if any, specified in such application.




     If the Trustee shall elect not to afford such applicants access to such information, the
Trustee shall, upon the written request of such applicants, mail to each of the Holders of
Subordinated Securities of such series, or all Subordinated Securities, as the case may be, whose
name and address appear in the information preserved at the time by the Trustee in accordance with
the provisions of subsection (a) of this Section 5.02, a copy of the form of proxy or other
communication which is specified in such request, with reasonable promptness after a tender to the
Trustee of the material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, the Trustee shall mail
to such applicants and file with the Commission, together with a copy of the material to be mailed,
a written statement to the effect that, in the opinion of the Trustee, such mailing would be
contrary to the best interests of the Holders of Subordinated Securities of such series or all
Subordinated Securities, as the case may be, or would be in violation of applicable law. Such
written statement shall specify the basis of such opinion. If the Commission, after opportunity for
a hearing upon the objections specified in the written statement so filed, shall enter an order
refusing to sustain any of such objections or if, after the entry of an order sustaining one or
more of such objections, the Commission shall find, after notice and opportunity for hearing, that
all the objections so sustained have been met and shall enter an order so declaring, the Trustee
shall mail copies of such material to all such Subordinated Securityholders with reasonable
promptness after the entry of such order and the renewal of such tender; otherwise the Trustee
shall be relieved of any obligation or duty to such applicants respecting their application.



     (c) Each and every Holder of the Subordinated Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee nor any Paying
Agent nor any registrar shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders of Subordinated Securities in accordance
with the provisions of subsection (b) of this Section 5.02, regardless of the source from which
such information was derived, and that the Trustee shall not be held accountable by reason of
mailing any material pursuant to a request made under said subsection (b).



     SECTION 5.03. Reports by Company. (a) The Company covenants and agrees to file with
the Trustee within 15 days after the Company is required to file the same with the Commission,
copies of the annual reports and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by rules and regulations
prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act; or, if the Company is not required to file information,
documents or reports pursuant to either of such sections, then to file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Exchange Act in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in such rules and
regulations.



     (b) The Company covenants and agrees to file with the Trustee and the Commission, in
accordance with the rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by the Company with the
conditions and covenants provided for in this Subordinated Indenture as may be required from time
to time by such rules and regulations.



     (c) The Company covenants and agrees to transmit to the Holders of Subordinated Securities
within 30 days after the filing thereof with the Trustee, in the manner and to the extent provided
in subsection (c) of Section 5.04 with respect to reports pursuant to subsection (a) of said
Section 5.04, such summaries of any information, documents and reports required to be filed by the
Company pursuant to subsections (a) and (b) of this Section 5.03 as may be required by rules and
regulations prescribed from time to time by the



24









 




Commission. Delivery of reports, information and documents to the Trustee under this Section
5.03 is for informational purposes only and the Trustee’s receipt of the foregoing shall not
constitute constructive notice of any information contained therein or determinable from
information contained therein, including the Company’s compliance with any of their covenants
hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).




     (d) The Company and any other obligor on the Subordinated Securities each covenant and agree
to furnish to deliver to the Trustee, within 120 days after the end of each fiscal year of the
Company ending after the date hereof, an Officers’ Certificate, from the principal executive
officer, principal financial officer or principal accounting officer stating whether or not to the
best knowledge of the signers thereof, the Company or Subsidiary of the Company is in default in
the performance and observance of any of the terms, provisions and conditions of this Subordinated
Indenture (without regard to any period of grace or requirement of notice provided hereunder) and,
if the Company or a Subsidiary of the Company in default, specifying all such defaults and the
nature and status thereof of which they may have knowledge.



     SECTION 5.04. Reports by Trustee. (a) On or before the first July 15th following the
date of execution of this Subordinated Indenture, and on or before July 15 in every year
thereafter, if and so long as any Subordinated Securities are Outstanding hereunder, the Trustee
shall transmit to the Subordinated Securityholders as hereinafter in this Section 5.04 provided, a
brief report dated as of the preceding May 15 with respect to any of the following events which may
have occurred within the previous 12 months (but if no such event has occurred within such period
no report need be transmitted):



          (1) any change to its eligibility under Section 7.09, and its qualifications under Section
7.08;




          (2) the creation of or any material change to a relationship specified in paragraph (1)
through (10) of Section 7.08(d);




          (3) the character and amount of any advances (and if the Trustee elects so to state, the
circumstances surrounding the making thereof) made by the Trustee (as such) which remain unpaid on
the date of such report, and for the reimbursement of which it claims or may claim a lien or
charge, prior to that of the Subordinated Securities of any series, on any property or funds held
or collected by it as Trustee, except that the Trustee shall not be required (but may elect) to
state such advances if such advances so remaining unpaid aggregate not more than one—half of one
percent of the principal amount of the Subordinated Securities of such series Outstanding on the
date of such report;




          (4) the amount, interest rate and maturity date of all other indebtedness owing by the Company
(or by any other obligor on the Subordinated Securities) to the Trustee in its individual capacity,
on the date of such report, with a brief description of any property held as collateral security
therefor, except indebtedness based upon a creditor relationship arising in any manner described in
paragraph (2), (3), (4) or (6) of subsection (b) of Section 7.13;




          (5) any change to the property and funds, if any, physically in the possession of the Trustee
(as such) on the date of such report;




          (6) any additional issue of Subordinated Securities which the Trustee has not previously
reported; and




          (7) any action taken by the Trustee in the performance of its duties under this Subordinated
Indenture which it has not previously reported and which in its opinion materially affects the
Subordinated Securities, except action in respect of a default, notice of which has been or is to
be withheld by it in accordance with the provisions of Section 6.10.




     (b) The Trustee shall transmit to the Subordinated Securityholders, as hereinafter provided, a
brief report with respect to the character and amount of any advances (and if the Trustee elects so
to state, the circumstances surrounding the making thereof) made by the Trustee (as such) since the
date of the last report transmitted pursuant to the provisions of subsection (a) of this Section
5.04 (or if no such report has yet been so transmitted, since the date of execution of this
Subordinated Indenture), for the reimbursement of which it claims or may claim a lien or charge
prior to that of the Subordinated Securities of any series on property or funds held or collected
by it as Trustee, and which it has not previously reported pursuant to this subsection, except that
the Trustee shall not be required (but may elect) to report such advances if such advances
remaining unpaid at any time aggregate ten percent or less of the principal amount of Subordinated
Securities of such series Outstanding at such time, such report to be transmitted within 90 days
after such time.



25









 





     (c) Reports pursuant to this Section 5.04 shall be transmitted by mail (i) to all Holders of
Subordinated Securities of any series, as the names and addresses of such Holders shall appear upon
the Register of the Subordinated Securities of such series, (ii) to such Holders of Subordinated
Securities as have, within the two years preceding such transmission, filed their names and
addresses with the Trustee for that purpose and (iii) except in the case of reports pursuant to
subsection (b) of this Section 5.04 to each Holder whose name and address are preserved at the time
by the Trustee as provided in Section 5.02(a) hereof.



     (d) A copy of each such report shall, at the time of such transmission to Subordinated
Securityholders, be filed by the Trustee with each stock exchange upon which the Subordinated
Securities of any series are listed and also with the Commission. The Company will notify the
Trustee when and as the Subordinated Securities of any series become listed on any stock exchange.



ARTICLE SIX




REMEDIES OF THE TRUSTEE AND SUBORDINATED

SECURITYHOLDERS ON EVENT OF DEFAULT




     SECTION 6.01. Events of Default; Acceleration, Waiver of Default and Restoration of
Position and Rights. The term “Event of Default” whenever used herein with respect to any
particular series of Subordinated Securities shall mean any one of the following events:



     (a) default in the payment of any installment of interest on any Subordinated Security of such
series as and when the same shall become due and payable, and continuance of such default for a
period of 30 days provided however, that an extension of one or more Interest Payment Dates by the
Company in accordance with the provisions of any Supplemental Subordinated Indenture, shall not
constitute an Event of Default; or



     (b) default in the payment of all or any part of the principal of or any premium on any
Subordinated Security of such series as and when the same shall become due and payable whether at
maturity, by proceedings for redemption, by declaration or otherwise, provided however, that an
extension of the Stated Maturity for payment of principal of Subordinated Securities of such series
in accordance with the provisions of any Supplemental Subordinated Indenture, shall not constitute
an Event of Default; or



     (c) failure on the part of the Company to observe or perform in any material respect any other
of the covenants or agreements on its part in the Subordinated Securities or in this Subordinated
Indenture (including any Supplemental Subordinated Indenture or pursuant to any Officer’s
Certificate, as contemplated by Section 2.03) specifically contained for the benefit of the Holders
of the Subordinated Securities of such series, for a period of 60 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 not less than 25% in principal amount of the Subordinated Securities of such
series and all other series so benefited (all series voting as one class) at the time Outstanding
under this Subordinated Indenture a written notice specifying such failure and stating that such is
a “Notice of Default” hereunder; or



     (d) the entry by a court having jurisdiction in the premises of a decree or order for relief
in respect of the Company in an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Company or for any substantial part
of its property, or ordering the winding up or liquidation of its affairs, if such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or



     (e) the commencement by the Company of a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or the Company’s consent to the entry
of an order for relief in any involuntary case under any such law, or its consent to the
appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or similar official) of the Company or for any substantial part of its property, or
the making by the Company of any general assignment for the benefit of creditors, or its failure
generally to pay its debts as they become due or the taking by the Company of any corporate action
in furtherance of any of the foregoing; or



     (f) any other Event of Default provided in the Officer’s Certificate or Supplemental
Subordinated Indenture under which such series of Subordinated is issued or in the form of
Subordinated Security for such series.



26









 





     If an Event of Default described in clause (a) or (b) shall have occurred and be continuing
with respect to any one or more series of Outstanding Subordinated Securities, then and in each and
every such case, unless the principal amount of all the Subordinated Securities of each series as
to which there is an Event of Default shall have already become due and payable, either the Trustee
or the Holders of not less than 25% in principal amount of the Subordinated Securities of such
series then Outstanding hereunder (each such series voting as a separate class) by notice in
writing to the Company (and to the Trustee if given by Subordinated Securityholders) may declare
the principal amount (or, if the Subordinated Securities of any such series are Original Issue
Discount Subordinated Securities, such portion of the principal amount as may be specified in the
terms of such series) of all the Subordinated Securities of such series, together with any accrued
interest, to be due and payable immediately, and upon any such declaration the same shall be
immediately due and payable, anything in this Subordinated Indenture or in the Subordinated
Securities of such series contained to the contrary notwithstanding.



     Except as otherwise provided in the terms of any series of Subordinated Securities pursuant to
Section 2.03, if an Event of Default described in clause (c) or (f) above with respect to all
series of Subordinated Securities then Outstanding, occurs and is continuing, then, and in each and
every such case, unless the principal of all of the Subordinated Securities shall have already
become due and payable, either the Trustee or the Holders of not less than 25% in aggregate
principal amount of all of the Subordinated Securities then Outstanding hereunder (treated as one
class) by notice in writing to the Company (and to the Trustee if given by Securityholders), may
declare the entire principal (or, if the Subordinated Securities of any series are Original Issue
Discount Securities, such portion of the principal amount as may be specified in the terms of such
series) of all of the Subordinated Securities then Outstanding, and the interest accrued thereon,
if any, to be due and payable immediately, and upon such declaration, the same shall become
immediately due and payable. If an Event of Default described in clause (e) or (f) above occurs and
is continuing, then the principal amount of all of the Subordinated Securities then Outstanding,
and the interest accrued thereon, if any, shall become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder.



     If an Event of Default described in clause (d) or (g) occurs and is continuing, which Event of
Default is with respect to less than all series of Subordinated Securities then Outstanding, then,
and in each and every such case, except for any series of Subordinated Securities the principal of
which shall have already become due and payable, either the Trustee or the Holders of not less than
25% in aggregate principal amount of the Subordinated Securities of each such affected series then
Outstanding hereunder (each such series voting as a separate class) by notice in writing to the
Company (and to the Trustee if given by Securityholders), may declare the entire principal (or, if
the Securities of such series are Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of such series) of all Securities of such series, and the
interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration,
the same shall become immediately due and payable.



     The foregoing provisions, however, are subject to the condition that if, at any time after the
principal amount (or, if the Subordinated Securities are Original Issue Discount Subordinated
Securities, such portion of the principal as may be specified in the terms thereof of the
Subordinated Securities of any one or more series (or of all the Subordinated Securities, as the
case may be) shall have been so declared due and payable, and before any judgment or decree for the
payment of moneys due shall have been obtained or entered as hereinafter provided, the Company
shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of
interest upon all the Subordinated Securities of such series (or upon all the Subordinated
Securities, as the case may be) and the principal of any and all Subordinated Securities of such
series (or of any and all the Subordinated Securities, as the case may be) which shall have become
due otherwise than by declaration (with interest on overdue installments of interest to the extent
permitted by law and on such principal at the rate or rates of interest borne by, or prescribed
therefor in the Subordinated Securities of such series to the date of such payment or deposit) and
interest upon such principal and, to the extent that payment of such interest is enforceable under
applicable law, on overdue installments of interest, at the same rate as the rate of interest or
Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities
of such series (or at the respective rates of interest or Yields to Maturity of all the Securities,
as the case may be) to the date of such payment or deposit; and the amounts payable to the Trustee
under Section 7.06 and any and all defaults under the Subordinated Indenture with respect to
Subordinated Securities of such series (or all Subordinated Securities, as the case may be), other
than the non— payment of principal of and any accrued interest on Subordinated Securities of such
series (or any Subordinated Securities, as the case may be) which shall have become due by
declaration shall have been cured, remedied or waived as provided in Section 6.09 — then and in
every such case the Holders of a majority in principal amount of the Subordinated Securities of
such series (or of all the Subordinated Securities, as the case may be) then Outstanding (such
series or all series voting as one class if more than one series are so entitled) by written notice
to the Company and to the Trustee, may rescind and annul such declaration and its consequences; but
no such rescission and annulment shall extend to or shall affect any subsequent default, or shall
impair any right consequent thereon.



27









 





     For all purposes under this Subordinated Indenture, if a portion of the principal of any
Original Issue Discount Securities shall have been accelerated and declared due and payable
pursuant to the provisions hereof, then, from and after such declaration, unless such declaration
has been rescinded and annulled, the principal amount of such Original Issue Discount Securities
shall be deemed, for all purposes hereunder, to be such portion of the principal thereof as shall
be due and payable as a result of such acceleration, and payment of such portion of the principal
thereof as shall be due and payable as a result of such acceleration, together with interest, if
any, thereon and all other amounts owing thereunder, shall constitute payment in full of such
Original Issue Discount Securities.



     In case the Trustee shall have proceeded to enforce any right under this Subordinated
Indenture and such proceedings shall have been discontinued or abandoned because of such rescission
or annulment or for any other reason or shall have been determined adversely to the Trustee, then
and in every such case the Company, the Trustee and the Holders of the Subordinated Securities of
such series (or of all the Subordinated Securities, as the case may be) shall be restored
respectively to their former positions and rights hereunder, and all rights, remedies and powers of
the Company and the Trustee and the Holders of the Subordinated Securities of such series (or of
all the Subordinated Securities, as the case may be) shall continue as though no such proceedings
had been taken.



     SECTION 6.02. Covenant of Company to Pay to Trustee Whole Amount Due on Subordinated
Securities on Default in Payment of Interest or Principal. The Company covenants that:



          (a) in case default shall be made in the payment of any installment of interest on any of the
Subordinated Securities of any series as and when the same shall become due and payable and which
payment has not been extended in accordance with the provisions of a Supplemental Subordinated
Indenture, and such default shall have continued for a period of 30 days;




          (b) in case default shall be made in the payment of all or any part of the principal of any of
the Subordinated Securities of any series when the same shall have become due and payable and which
payment has not been extended in accordance with the provisions of a Supplemental Subordinated
Indenture, whether at the Stated Maturity of such series or by any call for redemption or by
declaration of acceleration or otherwise; or




          (c) upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the
Holders of the Subordinated Securities of such series, the whole amount that then shall have become
due and payable on all such Subordinated Securities of such series for principal (and any premium)
and interest together with interest upon the overdue principal and installments of interest (to the
extent permitted by law) at the rate or rates of interest borne by or Yield to Maturity (in the
case of Original Issue Discount Subordinated Securities), or prescribed therefor in, the
Subordinated Securities of such series; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expense of collection, including a reasonable compensation to the
Trustee, its agents and counsel, and any expenses or liabilities incurred, and all advances made,
by the Trustee hereunder other than through its negligence or bad faith.




     In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in
its own name and as Trustee of an express trust, shall be entitled and empowered to institute any
actions or proceedings at law or in equity for the collection of the sums so due and unpaid, and
may prosecute any such action or proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon such Subordinated
Securities, and collect in the manner provided by law out of the property of the Company or any
other obligor upon such Subordinated Securities wherever situated the moneys adjudged or decreed to
be payable.



     If an Event of Default with respect to Subordinated 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 Subordinated Securities of such series by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this Subordinated Indenture or
in aid of the exercise of any power granted herein, or to enforce any other proper remedy.



     SECTION 6.03. Trustee May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other similar judicial proceeding relative to the Company or any other obligor upon
the Subordinated Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Subordinated Securities of any
series shall then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company for the payment of



28









 




overdue principal or interest) shall be entitled and empowered, to the fullest extent
permitted by law, by intervention in such proceeding or otherwise:




          (a) to file and prove a claim for the whole amount of principal (and premium, if any) and
interest owing and unpaid in respect of the Subordinated Securities (or, if the Subordinated
Securities are Original Issue Discount Subordinated Securities, such portion of the principal
amount as may be specified in the terms of such Subordinated Securities) and to file such other
papers or documents as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding; and




          (b) 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 7.06.




     Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to
or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Subordinated 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.



     SECTION 6.04. Trustee May Enforce Claims Without Possession of Subordinated
Securities. All rights of action and claims under this Subordinated Indenture or the
Subordinated Securities of any series may be prosecuted and enforced by the Trustee to the fullest
extent permitted by law without the possession of any of the Subordinated Securities of any series
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 Subordinated Securities in respect of which such judgment has been recovered.



     SECTION 6.05. Application of Moneys Collected by Trustee. Any moneys collected by the
Trustee pursuant to Section 6.02 shall be applied in the order following, at the date or dates
fixed by the Trustee for the distribution of such moneys, upon presentation of the several
Subordinated Securities in respect of which moneys have been collected, and stamping thereon the
payment, if only partially paid, and upon surrender thereof if fully paid:



          FIRST: To the payment of all amounts due to the Trustee under Section 7.06;




          SECOND: In case the principal of the Outstanding Subordinated Securities in respect of which
moneys have been collected shall not have become due and be unpaid, to the payment of any interest
on such Subordinated Securities, in the order of the maturity of the installments of such interest,
with interest upon the overdue installments of interest (so far as permitted by law and to the
extent that such interest has been collected by the Trustee at the rate or rates of interest borne
by or Yield to Maturity (in the case of Original Issue Discount Subordinated Securities) of such
Subordinated Securities or prescribed therefor therein) such payments to be made ratably to the
Persons entitled thereto, without discrimination or preference;




          THIRD: In case the principal of the Outstanding Subordinated Securities in respect of which
such moneys have been collected shall have become due, by declaration or otherwise, to the payment
of the whole amount then owing and unpaid upon such Subordinated Securities for principal and
interest, if any, with interest on the overdue principal and any installments of interest (so far
as permitted by law and to the extent that such interest has been collected by the Trustee) at the
rate or rates of interest borne by or Yield to Maturity (in the case of Original Issue Discount
Subordinated Securities), or prescribed therefor in, such Subordinated Securities; and in case such
moneys shall be insufficient to pay in full the whole amount so due and unpaid upon such
Subordinated Securities, then to the payment of such principal and interest or Yield to Maturity,
without preference or priority of principal over interest or Yield to Maturity, or of interest or
Yield to Maturity over principal, or of any installment of interest over any other installment of
interest, or of any Subordinated Security over any other Subordinated Security, ratably to the
aggregate of such principal and accrued and unpaid interest or Yield to Maturity; and




29









 








          FOURTH: To the payment of the remainder, with appropriate interest to the Company or its
successors or assigns, or to whomsoever may be lawfully entitled to receive the same, or as a court
of competent jurisdiction may direct.




     SECTION 6.06. Limitation on Suits by Holders of Subordinated Securities. No Holder of
any Subordinated Security of any series shall have any right by virtue or by availing of any
provision of this Subordinated Indenture to institute any suit, action or proceeding in equity or
at law upon or under or with respect to this Subordinated Indenture or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless such Holder previously shall have
given to the Trustee written notice of a continuing Event of Default, as hereinbefore provided, and
unless also the Holders of not less than 25% in principal amount of the Subordinated Securities of
such series then Outstanding shall have made written request upon the Trustee to institute such
action, suit or proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to
be incurred therein or thereby (including the reasonable fees of counsel for the Trustee), and the
Trustee, for 60 days after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding and no direction inconsistent
with such written request shall have been given to the Trustee by the holders of a majority in
principal amount of the outstanding debt securities pursuant to this Section 6.06; it being
understood and intended, and being expressly covenanted by the taker and Holder of every
Subordinated Security with every other taker and Holder and the Trustee, that no one or more
Holders of Subordinated Securities of any series shall have any right in any manner whatever by
virtue or by availing of any provision of this Subordinated Indenture to affect, disturb or
prejudice the rights of the Holders of any other of such Subordinated Securities, or to obtain or
seek to obtain priority over or preference to any other such Holder, or to enforce any right under
this Subordinated Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all Holders of Subordinated Securities of the applicable series. For the
protection and enforcement of the provisions of this Section 6.06, each and every Holder and the
Trustee shall be entitled to such relief as can be given either at law or in equity.



     Notwithstanding any other provisions in this Subordinated Indenture, the right of any Holder
of any Subordinated Security to receive payment of the principal of and interest on such
Subordinated Security on or after the respective due dates expressed in such Subordinated Security
(or, in the case of redemption, on or after the date fixed for redemption), or to institute suit
for the enforcement of any such payment on or after such respective dates shall not be impaired or
affected without the consent of such Holder.



     SECTION 6.07. Rights and Remedies Cumulative. All powers and remedies given by this
Article Six to the Trustee or to the Holders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any thereof or of any other powers and remedies available to the
Trustee or the Holders, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Subordinated Indenture, and no delay
or omission of the Trustee or of any Holder of any of the Subordinated Securities to exercise any
right or power accruing upon any default occurring and continuing as aforesaid shall impair any
such right or power, or shall be construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of Section 6.06, every power and remedy given by this
Article Six or by law to the Trustee or to the Holders may be exercised from time to time, and as
often as shall be deemed expedient, by the Trustee or by the Holders. The assertion or employment
of any right or remedy hereunder or otherwise shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.



     SECTION 6.08. Delay or Omission Not Waiver. No delay or omission of the Trustee or of
any Holder of any Subordinated 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. Subject to the provisions of Section 6.06, every right and
remedy given by this Article Six or by law to the Trustee or to the Holders may be exercised from
time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the
case may be.



     SECTION 6.09. Control by Holders; Waiver of Past Defaults. The Holders of a majority
in principal amount of the Subordinated Securities of all series (voting as one class) at the time
Outstanding (determined as provided in Section 8.04) 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; provided, however, that, subject to Section
7.01 the Trustee shall have the right to decline to follow any such direction if the Trustee in
reliance upon an Opinion of Counsel determines that the action so directed may not lawfully be
taken, or if the Trustee in good faith shall, by a Responsible Officer or Officers of the Trustee,
determine that the proceedings so directed would be illegal or involve it in personal liability or
be unduly prejudicial to the rights of Holders not parties to such direction, and provided further
that nothing in this Subordinated Indenture shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such direction by the
Holders.



30









 





     The Company may set a special record date for purposes of determining the identity of the
Holders of Subordinated Securities entitled to vote or consent to any action by vote or consent
authorized or permitted by this Section 6.09. Such record date shall be the later of 15 days prior
to the first solicitation of such consent or the date of the most recent list of Holders furnished
to the Trustee pursuant to Section 5.01 of this Subordinated Indenture prior to such solicitation.



     The Holders of not less than a majority in principal amount of the Subordinated Securities of
any series at the time Outstanding (determined as provided in Section 8.04) may on behalf of the
Holders of all the Subordinated Securities of such series waive any past Event of Default with
respect to such series and its consequences (subject to Section 6.02), except a continuing Event of
Default specified in Section 6.01(a), (b) or (c), or in respect of a covenant or provision of this
Subordinated Indenture which under Article Ten cannot be modified or amended without the consent of
the Holder of each Subordinated Security so affected. Upon any such waiver, the Company, the
Trustee and the Holders of the Subordinated Securities of such series shall be restored to their
former positions and rights hereunder, respectively, and such Event of Default shall be deemed to
have been cured and not continuing for every purpose of this Subordinated Indenture; but no such
waiver shall extend to any subsequent or other Event of Default or impair any right consequent
thereon.



     SECTION 6.10. Trustee to Give Notice of Defaults Known to it, but May Withhold in Certain
Circumstances. The Trustee shall, within 90 days after the occurrence of a default with respect
to the Subordinated Securities of any series, give notice of all defaults with respect to that
series known to the Trustee to all Holders of Subordinated Securities of such series in the manner
and to the extent provided in Section 313(c) of the Trust Indenture Act, unless in each case such
defaults shall have been cured before the mailing or publication of such notice (the term “default”
for the purpose of this Section being hereby defined to mean any event or condition which is, or
with notice or lapse of time or both would become, an Event of Default); provided, that, except in
the case of default in the payment of the principal of or interest on any of the Subordinated
Securities of such series, the Trustee shall be protected in withholding such notice if and so long
as the board of directors, the executive committee, or a trust committee of directors or trustees
and/or Responsible Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Subordinated Securityholders of such series.



     SECTION 6.11. Requirement of an Undertaking to Pay Costs in Certain Suits Under the
Subordinated Indenture or Against the Trustee. All parties to this Subordinated Indenture
agree, and each Holder of any Subordinated Security by such Holder’s acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Subordinated Indenture, or in any suit against the
Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in its discretion
assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such
suit, having due regard to the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section 6.11 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder of Subordinated Securities of any series, or group of
such Holders, holding in the aggregate more than ten percent in principal amount of the
Subordinated Securities of such series Outstanding, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of or any interest or premium on any Subordinated
Security, on or after the due date expressed in such Subordinated Security or for such interest (or
in the case of any redemption, on or after the dated fixed for redemption).



     SECTION 6.12. Waiver of 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 stay or extension law wherever enacted,
now or at any time hereinafter 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 they will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.



ARTICLE SEVEN




CONCERNING THE TRUSTEE




     SECTION 7.01. Certain Duties and Responsibilities of Trustee. The Trustee, prior to
the occurrence of an Event of Default and after the curing, remedying or waiving of all Events of
Default which may have occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Subordinated Indenture. In case an Event of Default has occurred
(which has not been cured, remedied or waived), the Trustee shall exercise such of the rights and
powers vested in it by this Subordinated Indenture, and



31









 




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 or her own affairs.




     No provision of this Subordinated Indenture shall be construed to relieve the Trustee from
liability for its own negligent action, its own negligent failure to act, or its own willful
misconduct, provided, however, that:



     (a) prior to the occurrence of an Event of Default and after the curing, remedying or waving
of all Events of Default which may have occurred:



          (1) the duties and obligations of the Trustee shall be determined solely by the express
provisions of this Subordinated Indenture and the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this Subordinated
Indenture, and no implied covenants or obligations shall be read into this Subordinated Indenture
against the Trustee;




          (2) in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely,
as to the truth of the statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming to the requirements of this
Subordinated Indenture; but 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 conform to the requirements of this
Subordinated Indenture (but need not confirm or investigate the accuracy of mathematical
calculations or other facts stated therein); and;




          (3) this Subsection shall not be construed to limit the effect of the first paragraph and the
second to last paragraph of this Section;




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



     (c) the Trustee shall not be liable with respect to any action taken or omitted to be taken by
it in good faith in accordance with the direction of the Holders of Subordinated Securities
pursuant to Section 6.09 relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee,
under this Subordinated Indenture.



     None of the provisions contained in this Subordinated Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur personal financial liability in the performance of
any of its duties hereunder or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.



     SECTION 7.02. Certain Rights of Trustee. Except as otherwise provided in Section 7.01:



     (a) The Trustee may rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;



     (b) Any request, direction, order or demand of the Company mentioned herein shall be
sufficiently evidenced by an Officer’s Certificate (unless other evidence in respect thereof shall
be herein specifically prescribed); and any resolution of the Board of Directors may be evidenced
to the Trustee by a Board Resolution;



     (c) The Trustee may consult with counsel and the written advice of such counsel or any Opinion
of Counsel shall be full and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with such written advice or
Opinion of Counsel;



     (d) The Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Subordinated Indenture at the request, order or direction of any of the Subordinated
Securityholders pursuant to the provisions of this Subordinated Indenture,



32









 




unless such Subordinated Securityholders shall have offered to the Trustee reasonable security
or indemnity satisfactory to the Trustee against the costs, expenses and liabilities which may be
incurred therein or thereby;




     (e) The Trustee shall not be liable for any action taken or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers conferred upon it by
this Subordinated Indenture;



     (f) The Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval, bond, debenture, note or other paper or document, unless requested in writing so
to do by the Holders of Subordinated Securities pursuant to Section 6.09; provided, however, that
if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely
to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms of this Subordinated
Indenture, the Trustee may require reasonable indemnity against such costs, expenses or liabilities
as a condition to such proceeding; and provided further, that nothing in this subsection (f) shall
require the Trustee to give the Subordinated Securityholders any notice other than that required by
Section 6.10. The reasonable expense of every such examination shall be paid by the Company or, if
paid by the Trustee, shall be reimbursed by the Company upon demand;



     (g) The Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or attorney appointed with
due care by it hereunder;



     (h) The Trustee shall be under no responsibility for the approval by it in good faith of any
expert for any of the purposes expressed in this Subordinated Indenture;



     (i) the Trustee shall not be deemed to have notice or be charged with knowledge of any default
(within the meaning of Section 602) or Event of Default with respect to the Securities of any
series for which it is acting as Trustee unless written notice of such default or Event of Default,
as the case may be, is received by the Trustee at the Corporate Trust Office of the Trustee from
the Company, any other obligor upon such Securities or by any Holder of such Securities, and such
notice references the Securities and this Indenture;



     (j) the rights, privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to, and shall be
enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and
other Person employed to act hereunder;



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



     (l) the permissive right of the Trustee hereunder to take or omit to take any action shall not
be construed as a duty; and



     (m) anything in this Indenture notwithstanding, in no event shall the Trustee be liable for
special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but
not limited to loss of profit), even if the Company has been advised as to the likelihood of such
loss or damage and regardless of the form of action.



     SECTION 7.03. Trustee Not Responsible for Recitals or Application of Proceeds. The
recitals contained herein and in the Subordinated Securities (other than the certificate of
authentication on the Subordinated Securities) shall be taken as the statements of the Company, and
the Trustee assumes no responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Subordinated Indenture or of the
Subordinated Securities. The Trustee shall not be accountable for the use or application by the
Company of any of the Subordinated Securities or of the proceeds thereof.



     SECTION 7.04. Trustee May Own Subordinated Securities. The Trustee, any Paying Agent,
registrar or any agent of the Company or of the Trustee, in its individual or any other capacity,
may become the owner or pledgee of Subordinated Securities with the same rights it would have if it
were not Trustee, Paying Agent, registrar or such other agent.



33









 





     SECTION 7.05. Moneys Received by Trustee to be Held in Trust. Moneys held by the
Trustee in trust need not be segregated from other funds except to the extent required by law. The
Trustee shall be under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.



     SECTION 7.06. Trustee Entitled to Compensation, Reimbursement and Indemnity. The
Company agrees to pay to the Trustee from time to time reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of a trustee of any express trust),
and the Company will pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in connection with the acceptance or
administration of its trust under this Subordinated Indenture (including the reasonable
compensation and the expenses and disbursements of its counsel and of all Persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from its negligence or
bad faith. The Company also agrees to indemnify the Trustee and its officers, directors, agents and
employees for, and to hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Trustee and arising out of or in connection with the
acceptance or administration of this trust, including the reasonable costs and expenses of
defending itself against any claim of liability in the premises. The obligations of the Company
under this Section to compensate the Trustee, to pay or reimburse the Trustee for expenses,
disbursements and advances and to indemnify and hold harmless the Trustee and its officers,
directors, agents and employees shall constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge of this Subordinated Indenture and the resignation or
removal of the Trustee. Such additional indebtedness shall be secured by a lien prior to that of
the Subordinated Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of principal of or interest or redemption premium on
particular Subordinated Securities.



     In addition and without prejudice to the rights provided to the Trustee under any of the
provisions of this Indenture, when the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 601(e) or Section 601(f), the expenses (including the
reasonable charges and expenses of its counsel) and the compensation for the services are intended
to constitute expenses of administration under any applicable Federal and State bankruptcy,
insolvency or other similar law.



     SECTION 7.07. Right of Trustee to Rely on Officer’s Certificate Where No Other Evidence
Specifically Prescribed. Except as otherwise provided in Section 7.01, whenever in the
administration of the provisions of this Subordinated Indenture the Trustee shall deem it necessary
or desirable that a matter be proved or established prior to taking, suffering or omitting any
action hereunder, such matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to
be conclusively proved and established by an Officer’s Certificate of the Company or an Opinion of
Counsel or both delivered to the Trustee, and such Officer’s Certificate or Opinion of Counsel, in
the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the
Trustee for any action taken, suffered or omitted by it under the provisions of this Subordinated
Indenture upon the faith thereof.



     SECTION 7.08. Disqualification; Conflicting Interest. If the Trustee has or shall
acquire a conflicting interest within the meaning of Section 310(b) of the Trust Indenture Act, the
Trustee shall eliminate such interest, apply to the Commission for permission to continue as
trustee (if any of the Securities are registered pursuant to the Securities Act) or, resign, to the
extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and
this Indenture. To the extent permitted by such Act, the Trustee, by virtue of its capacity as
Trustee of the Securities of any series shall not be deemed to have a conflicting interest arising
from its capacity as trustee in respect of the Securities of any other series issued under this
Indenture. Nothing herein shall prevent the Trustee from filing with the Commission the
application referred to in the second to last paragraph of Section 310(b) of the Trust Indenture
Act.



     SECTION 7.09. Requirements for Eligibility of Trustee. There shall always be at least
one Trustee hereunder. The Trustee hereunder shall at all times be a Company organized and doing
business as a commercial bank under the laws of the United States of America or any state thereof
or of the District of Columbia or a Company or other Person permitted to act as a trustee by the
Commission and, in each case, authorized under such laws to exercise corporate trust powers, having
(or, in the case of a subsidiary of a bank holding company, its bank holding company parent shall
have) a combined capital and surplus of at least $50,000,000, and subject to supervision or
examination by Federal, State or District of Columbia authority. If such Company or bank holding
company parent publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Company or bank holding company parent shall be
deemed to be its combined capital and surplus as set forth in its most recent report of condition
so published. No obligor on the Subordinated Securities or Person directly or indirectly
controlling, controlled by or under common control with



34









 




such obligor shall serve as Trustee. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 7.09, the Trustee shall resign
immediately in the manner and with the effect specified in this Article Seven.




     SECTION 7.10. Resignation and Removal of Trustee; Appointment of Successor.



     (a) No resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of appointment by the
successor Trustee in accordance with the applicable requirements of Section 6.11.



     The Trustee, may resign at any time with respect to the Subordinated Securities of one or more
series of by giving written notice thereof to the Company. If the instrument of acceptance by a
successor Trustee required by Section 7.11 shall not have been delivered to the Trustee within 30
days after the giving of such notice of resignation, the resigning Trustee may, at the expense of
the Company, petition any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.



     The Trustee may be removed at any time with respect to the Securities of any series by Act of
the Holders of a majority in principal amount of the Outstanding Securities of such series,
delivered to the Trustee and to the Company. If the instrument of acceptance by a successor
Trustee required by Section 6.11 shall not have been delivered to the Trustee within 30 days after
the Trustee’s receipt of such notice of removal, the departing Trustee may, at the expense of the
Company, petition any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Subordinated Security of such series.



     (b) In case at any time any of the following shall occur:



          (1) the Trustee shall fail to comply with the provisions of subsection (a) of Section 7.08
after written request therefor by the Company or by any Subordinated Securityholder who has been a
bona fide Holder of a Subordinated Security or Subordinated Securities of the applicable series for
at least six months; or




          (2) the Trustee shall cease to be eligible in accordance with the provisions of Section 7.09
and shall fail to resign after written request therefor by the Company or by any such Subordinated
Securityholder; or




          (3) the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation, conservation or liquidation; or




          (4) the Company shall determine that the Trustee has failed to perform its obligations under
this Subordinated Indenture in any material respect, then, in any such case, the Company may remove
the Trustee and appoint a successor trustee by written instrument executed by an authorized officer
of the Company, one copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of Section 6.11, any Subordinated
Securityholder who has been a bona fide Holder of a Subordinated Security or Subordinated
Securities of the affected series for at least six months may, on such Person’s behalf and on
behalf of all others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee with respect to such series. Such
court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor trustee.




     (c) The Holders of a majority in principal amount of the Subordinated Securities Outstanding
(determined as provided in Section 8.04) may at any time remove the Trustee and appoint a successor
trustee by written instrument or instruments signed by such Holders or their attorneys—in—fact
duly authorized, or by the affidavits of the permanent chairman and secretary of a meeting of the
Subordinated Securityholders evidencing the vote upon a resolution or resolutions submitted thereto
with respect to such removal and appointment (as provided in Article Nine), and by delivery thereof
to the Trustee so removed, to the successor trustee and to the Company.



     (d) Any resignation or removal of the Trustee and any appointment of a successor trustee
pursuant to any of the provisions of this Section 7.10 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 7.11.



     SECTION 7.11. Acceptance of Appointment by Successor Trustee. Any successor trustee
appointed as provided in Section 7.10 shall execute, acknowledge and deliver to the Company and to
its predecessor trustee an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and such successor
trustee,



35









 




without any further act, deed or conveyance, shall become vested with all the rights, powers,
duties and obligations with respect to such series of its predecessor hereunder, with like effect
as if originally named as trustee herein; but, nevertheless, on the written request of the Company
or of the successor trustee, the trustee ceasing to act shall, upon payment of any amounts then due
it pursuant to the provisions of Section 7.06, execute and deliver an instrument transferring to
such successor trustee all the rights and powers with respect to the trustee so ceasing to act.
Upon written request of any such successor trustee, the Company shall execute any and all
instruments in writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall, nevertheless, retain a lien
upon all property or funds held or collected by such trustee to secure any amounts then due it
pursuant to the provisions of Section 7.06.




     No successor trustee shall accept appointment as provided in this Section 7.11 unless at the
time of such acceptance such successor trustee shall be qualified under the provisions of Section
7.08 and eligible under the provisions of Section 7.09.



     SECTION 7.12. Successor to Trustee by Merger, Consolidation or Succession to Business.
Any Company into which the Trustee may be merged or converted or with which it may be consolidated,
or any Company resulting from any merger, conversion or consolidation to which the Trustee shall be
a party, or any Company succeeding to all or substantially all of the corporate trust business of
the Trustee (including the administration of the trust created by this Indenture), shall be the
successor of the Trustee hereunder, provided such Company shall be qualified under the provisions
of Section 7.08 and eligible under the provisions of Section 7.09, without the execution or filing
of any paper or any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.



     In case at the time such successor to the Trustee shall succeed to the trusts created by this
Subordinated Indenture any of the Subordinated Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of authentication of any
predecessor Trustee, and deliver such Subordinated Securities so authenticated; and in case at that
time any of the Subordinated Securities shall not have been authenticated, any successor to the
Trustee may authenticate such Subordinated Securities either in the name of any predecessor
hereunder or in the name of the successor Trustee; and in all such cases such certificates shall
have the full force which it is anywhere in the Subordinated Securities or in this Subordinated
Indenture provided that the certificate of the Trustee shall have; provided, however, that the
right to adopt the certificate of authentication of any predecessor Trustee or to authenticate
Subordinated Securities in the name of any predecessor Trustee shall apply only to its successor or
successors by merger, conversion or consolidation.



     SECTION 7.13. Preferential Collection of Claims Against Company. If and when the
Trustee shall be or become a creditor of the Company (or any other obligor upon the Subordinated
Securities), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding
the collection of claims against the Company (or any such other obligor).



     SECTION 7.14. Appointment of Authenticating Agent. As long as any Subordinated
Securities of a series remain Outstanding, the Trustee may, by an instrument in writing, appoint
with the approval of the Company an authenticating agent (the “Authenticating Agent”) which shall
be authorized to act on behalf of the Trustee to authenticate Subordinated Securities, including
Subordinated Securities issued upon exchange, registration of transfer, partial redemption or
pursuant to Section 2.09. Subordinated Securities of each such series authenticated by such
Authenticating Agent shall be entitled to the benefits of this Subordinated Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee. Whenever reference is
made in this Subordinated Indenture to the authentication and delivery of Subordinated Securities
of any series by the Trustee or to the Trustee’s Certificate of Authentication, such reference
shall be deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent for such series and a Certificate of Authentication executed on behalf of the
Trustee by such Authenticating Agent. Such Authenticating Agent shall at all times be a corporation
organized and doing business under the laws of the United States of America or of any State,
authorized under such laws to exercise corporate trust powers, having (or in the case of a
subsidiary of a bank holding company, its bank holding company parent shall have) a combined
capital and surplus of at least $45,000,000 (determined as provided in Section 7.09 with respect to
the Trustee) and subject to supervision or examination by Federal or State authority.



     Any corporation into which any Authenticating Agent may be merged or converted, or with which
it may be consolidated, or any corporation resulting from any merger, conversion or consolidation
to which any Authenticating Agent (including the agency contemplated by this Indenture) shall be a
party, or any corporation succeeding to the corporate agency business of any Authenticating Agent,
shall continue to be the authenticating Agent with respect to all series of Subordinated Securities
for which it served as Authenticating Agent without the execution or filing of any paper or any
further act on the part of the Trustee or such Authenticating



36









 




Agent. Any Authenticating Agent may at any time, and if it shall cease to be eligible shall,
resign by giving written notice of resignation to the Trustee and to the Company.




     Upon receiving such a notice of resignation or upon such a termination, or in case in any time
any Authenticating Agent shall cease to be eligible in accordance with the provisions of this
Section 7.14 with respect to one or more series of Subordinated Securities, the Trustee shall upon
receipt of a Company Order appoint a successor Authenticating Agent and the Company shall provide
notice of such appointment to all Holders of Subordinated Securities of such series in the manner
and to the extent provided in Section 13.02. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all rights, powers, duties and responsibilities
of its predecessor hereunder, with like effect as if originally named as Authenticating Agent. The
Company agrees to pay to the Authenticating Agent for such series from time to time reasonable
compensation. The Authenticating Agent for the Subordinated Securities of any series shall have no
responsibility or liability for any action taken by it as such at the direction of the Trustee.



     If an appointment is made with respect to one or more series pursuant to this Section, the
Subordinated Securities of such series may have endorsed thereon, in addition to the Trustee’s
certificate of authentication, an alternative certificate of authentication substantially in the
following form:



     This is one of the Subordinated Securities described in the within—mentioned Subordinated
Indenture.



	 	 	 	 	 
	 	Wells Fargo Bank, N.A., as Trustee

 	 
	 	By  	 	 
	 	 	As Authenticating Agent 	 
	 	 	 	 
	 
	 	 	 
	 	By  	
 	 
	 	 	Authorized Signatory 	 
	 	 	 	 
	 




     Sections 7.02, 7.03, 7.04, 7.06 and 8.03 shall be applicable to any Authenticating Agent.



ARTICLE EIGHT




CONCERNING THE SUBORDINATED SECURITYHOLDERS




     SECTION 8.01. Evidence of Action by Subordinated Securityholders. Whenever in this
Subordinated Indenture it is provided that the Holders of a specified percentage in principal
amount of the Subordinated Securities of any or all series may take any action (including the
making of any demand or request, the giving of any notice, consent or waiver or the taking of any
other action), the fact that at the time of taking any such action the Holders of such specified
percentage have joined therein may be evidenced (a) by any instrument or any number of instruments
of similar tenor executed by such Subordinated Securityholders in Person or by agent or proxy
appointed in writing, or (b) by the record of such Holders of Subordinated Securities voting in
favor thereof at any meeting of such Subordinated Securityholders duly called and held in
accordance with the provisions of Article Nine, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of such Subordinated Securityholders.



     SECTION 8.02. Proof of Execution of Instruments and of Holding of Subordinated
Securities. Subject to the provisions of Sections 7.01, 7.02 and 9.05, proof of the execution
of any instrument by a Subordinated Securityholder or such Holder’s agent or proxy and proof of the
holding by any Person of any of the Subordinated Securities shall be sufficient if made in the
following manner:



     (a) The fact and date of the execution by any such Person of any instrument may be proved in
any reasonable manner acceptable to the Trustee;



     (b) The ownership of Subordinated Securities of any series shall be proved by the Register of
such Subordinated Securities of such series, or by certificates of the Subordinated Security
registrar or registrars thereof.



37









 





     The Trustee shall not be bound to recognize any Person as a Subordinated Securityholder unless
and until such Person’s title to the Subordinated Securities held by it is proved in the manner in
this Article Eight provided.



     The record of any Subordinated Securityholders’ meeting shall be proved in the manner provided
in Section 9.06.



     The Trustee may accept such other proof or require such additional proof of any matter
referred to in this Section 8.02 as it shall deem reasonable.



     SECTION 8.03. Who May be Deemed Owners of Subordinated Securities. Prior to due
presentment for transfer of any Subordinated Security, the Company, the Trustee and any agent of
the Company or the Trustee may deem and treat the Person in whose name such Subordinated Security
shall be registered upon the Register of Subordinated Securities of the series of which such
Subordinated Security is a part as the absolute owner of such Subordinated Security (whether or not
such Subordinated Security shall be overdue and notwithstanding any notation of ownership or other
writing thereon) for the purpose of receiving payment of or on account of the principal of and
interest, subject to the provisions of this Subordinated Indenture, on such Subordinated Security
and for all other purposes; and neither the Company nor the Trustee nor any agent of the Company or
the Trustee shall be affected by any notice to the contrary. All such payments so made to any such
Holder for the time being, or upon such Holder’s order, shall be valid, and, to the extent of the
sum or sums so paid, effectual to satisfy and discharge the liability of moneys payable upon any
such Subordinated Security.



     If the Subordinated Securities of any series are issued in the form of one or more Global
Subordinated Securities, the Depository therefor may grant proxies to Persons having a beneficial
ownership in such Global Subordinated Security or Subordinated Securities for purposes of voting or
otherwise responding to any request for consent, waiver or other action which the Holder of such
Registered Subordinated Security is entitled to grant or take under this Subordinated Indenture and
the Trustee shall accept such proxies for the purposes granted; provided that neither the Trustee
nor the Company shall have any obligation with respect to the grant of or solicitation by the
Depository of such proxies.



     SECTION 8.04. Subordinated Securities Owned by the Company or Controlled or Controlling
Persons Disregarded for Certain Purposes. In determining whether the Holders of the requisite
principal amount of Subordinated Securities have concurred in any demand, direction, request,
notice, vote, consent, waiver or other action under this Subordinated Indenture, Subordinated
Securities which are owned by the Company or any other obligor on the Subordinated Securities or by
any Person directly or indirectly controlling or controlled by or under direct or indirect common
control with the Company or any other obligor on the Subordinated Securities shall be disregarded
and deemed not to be Outstanding for the purpose of any such determination, provided that for the
purposes of determining whether the Trustee shall be protected in relying on any such demand,
direction, request, notice, vote, consent, waiver or other action, only Subordinated Securities
which a Responsible Officer of the Trustee assigned to its Principal Office knows are so owned
shall be so disregarded. Subordinated Securities so owned which have been pledged in good faith may
be regarded as Outstanding for the purposes of this Section 8.04, if the pledgee shall establish to
the satisfaction of the Trustee the pledgee’s right to vote such Subordinated Securities and that
the pledgee is not a Person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any such other obligor.



     Upon request of the Trustee, the Company shall furnish to the Trustee promptly an Officer’s
Certificate listing and identifying all Subordinated Securities, if any, known by the Company to be
owned or held by or for the account of the Company or any other obligor on the Subordinated
Securities or by any Person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other obligor on the Subordinated Securities; and,
subject to the provisions of Section 7.01, the Trustee shall be entitled to accept such Officer’s
Certificate as conclusive evidence of the facts therein set forth and of the fact that all
Subordinated Securities not listed therein are Outstanding for the purpose of any such
determination.



     SECTION 8.05. Instruments Executed by Subordinated Securityholders Bind Future
Holders. At any time prior to (but not after) the evidencing to the Trustee, as provided in
Section 8.01, of the taking of any action by the Holders of the percentage in principal amount of
the Subordinated Securities specified in this Subordinated Indenture in connection with such
action, any Holder of a Subordinated Security which is shown by the evidence to be included in the
Subordinated Securities the Holders of which have consented to such action may, by filing written
notice with the Trustee at its principal office and upon proof of holding as provided in Section
8.02, revoke such action so far as concerns such Subordinated Security. Except as aforesaid any
such action taken by the Holder of any Subordinated Security and any direction, demand, request,
notice, waiver, consent, vote or other action of the Holder of



38









 




any Subordinated Security which by any provisions of this Subordinated Indenture is required
or permitted to be given shall be conclusive and binding upon such Holder and upon all future
Holders and owners of such Subordinated Security, and of any Subordinated Security issued in lieu
thereof, irrespective of whether any notation in regard thereto is made upon such Subordinated
Security. Any action taken by the Holders of the percentage in principal amount of the Subordinated
Securities of any or all series specified in this Subordinated Indenture in connection with such
action shall be conclusively binding upon the Company, the Trustee and the Holders of all of the
Subordinated Securities of such series subject, however, to the provisions of Section 7.01.




ARTICLE NINE




SUBORDINATED SECURITYHOLDERS’ MEETINGS




     SECTION 9.01. Purposes for Which Meetings May be Called. A meeting of Holders of
Subordinated Securities of any or all series may be called at any time and from time to time
pursuant to the provisions of this Article for any of the following purposes:



          (a) to give any notice to the Company or to the Trustee, or to give any directions to the
Trustee, or to consent to the waiving of any default hereunder and its consequences, or to take any
other action authorized to be taken by Holders of Subordinated Securities of any or all series, as
the case may be, pursuant to any of the provisions of Article Six;




          (b) to remove the Trustee and appoint a successor trustee pursuant to the provisions of
Article Seven;




          (c) to consent to the execution of an indenture or indentures supplemental hereto pursuant to
the provisions of Section 10.02; or




          (d) to take any other action authorized to be taken by or on behalf of the Holders of any
specified principal amount of the Subordinated Securities of any or all series, as the case may be,
under any other provision of this Subordinated Indenture or under applicable law.




     SECTION 9.02. Manner of Calling Meetings. The Trustee may at any time call a meeting
of Subordinated Securityholders to take any action specified in Section 9.01, to be held at such
time and at such place in The City of New York, New York, or such other city as the Trustee shall
determine. Notice of every meeting of Subordinated Securityholders, setting forth the time and
place of such meeting and in general terms the action proposed to be taken at such meeting, shall
be mailed not less than 20 nor more than 60 days prior to the date fixed for the meeting.



     SECTION 9.03. Call of Meeting by the Company or Subordinated Securityholders. In case
at any time the Company pursuant to a resolution of its Board of Directors, or the Holders of not
less than ten percent in principal amount of the Subordinated Securities of any or all series, as
the case may be, then Outstanding, shall have requested the Trustee to call a meeting of Holders of
Subordinated Securities of any or all series, as the case may be, to take any action authorized in
Section 9.01 by written request setting forth in reasonable detail the action proposed to be taken
at the meeting, and the Trustee shall not have mailed notice of such meeting within 20 days after
receipt of such request, then the Company or such Holders of Subordinated Securities in the amount
above specified may determine the time and place in either the City and County of Los Angeles,
California or The City of New York, New York for such meeting and may call such meeting to take any
action authorized in Section 9.01, by mailing (and publishing, if required) notice thereof as
provided in Section 9.02.



     SECTION 9.04. Who May Attend and Vote at Meetings. To be entitled to vote at any
meeting of Subordinated Securityholders a Person shall (a) be a Holder of one or more Subordinated
Securities with respect to which the meeting is being held; or (b) be a Person appointed by an
instrument in writing as proxy by such Holder of one or more Subordinated Securities. The only
Persons who shall be entitled to be present or to speak at any meeting of Subordinated
Securityholders shall be the Persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the Company and its
counsel.



     SECTION 9.05. Regulations May be Made by Trustee; Conduct of the Meeting; Voting Rights —
Adjournment. Notwithstanding any other provisions of this Subordinated Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting of Subordinated
Securityholders, in regard to proof of the holding of Subordinated Securities and of the
appointment of proxies, and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the right to vote, and
such other matters concerning the conduct of the meeting as it shall think fit. Except as



39









 




otherwise permitted or required by any such regulations, the holding of Subordinated
Securities shall be proved in the manner specified in Section 8.02. and the appointment of any
proxy shall be proved in the manner specified in said Section 8.02; provided, however, that such
regulations may provide that written instruments appointing proxies regular on their face, may be
presumed valid and genuine without the proof hereinabove or in said Section 8.02 specified.




     The Trustee shall by an instrument in writing, appoint a temporary chairman of the meeting,
unless the meeting shall have been called by the Company or by Subordinated Securityholders as
provided in Section 9.03, in which case the Company or the Subordinated Securityholders calling the
meeting, as the case may be, shall in like manner appoint a temporary chairman. A permanent
chairman and a permanent secretary of the meeting shall be elected by majority vote of the meeting.



     Subject to the provisions of Section 8.04, at any meeting each Subordinated Securityholder or
proxy shall be entitled to one vote for each $1,000 principal amount (in the case of Original Issue
Discount Subordinated Securities, such principal amount shall be equal to such portion of the
principal amount as may be specified in the terms of such series) of Subordinated Securities held
or represented by such Holder; provided, however, that no vote shall be cast or counted at any
meeting in respect of any Subordinated Security challenged as not Outstanding and ruled by the
chairman of the meeting to be not Outstanding. The chairman of the meeting shall have no right to
vote other than by virtue of Subordinated Securities held by such Person or instruments in writing
as aforesaid duly designating such Person as the Person to vote on behalf of other Subordinated
Securityholders. Any meeting of Subordinated Securityholders duly called pursuant to the provisions
of Section 9.02 or 9.03 may be adjourned from time to time, and the meeting may be held so
adjourned without further notice.



     At any meeting of Subordinated Securityholders, the presence of Persons holding or
representing Subordinated Securities in principal amount sufficient to take action on the business
for the transaction of which such meeting was called shall constitute a quorum, but, if less than a
quorum is present, the Persons holding or representing a majority in principal amount of the
Subordinated Securities represented at the meeting may adjourn such meeting with the same effect
for all intents and purposes, as though a quorum had been present.



     SECTION 9.06. Manner of Voting at Meetings and Record to be Kept. The vote upon any
resolution submitted to any meeting of Subordinated Securityholders shall be by written ballots on
which shall be subscribed the signatures of the Holders of Subordinated Securities or of their
representatives by proxy and the principal amount or principal amounts of the Subordinated
Securities held or represented by them. The permanent chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting for or against any resolution and
who shall make and file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Subordinated Securityholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more Persons having knowledge of the facts setting
forth a copy of the notice of the meeting and showing that said notice was mailed as provided in
Section 9.02. The record shall show the principal amount or principal amounts of the Subordinated
Securities voting in favor of or against any resolution. The record shall be signed and verified by
the affidavits of the permanent chairman and secretary of the meeting and one copy thereof shall be
delivered to the Company and the other to the Trustee to be preserved by the Trustee.



     Any record so signed and verified shall be conclusive evidence of the matters therein stated.



     SECTION 9.07. Exercise of Rights of Trustee and Subordinated Securityholders Not to be
Hindered or Delayed. Nothing in this Article Nine contained shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Subordinated Securityholders or any
rights expressly or impliedly conferred hereunder to make such call, any hindrances or delay in the
exercise of any right or rights conferred upon or reserved to the Trustee or to the Subordinated
Securityholders under any of the provisions of this Subordinated Indenture or of the Subordinated
Securities.



ARTICLE TEN




SUPPLEMENTAL SUBORDINATED INDENTURES




     SECTION 10.01. Purposes for Which Supplemental Subordinated Indentures May be Entered into
Without Consent of Subordinated Securityholders. Without the consent of the Holders of any
Subordinated Securities, the Company and the Trustee may



40









 





from time to time and at any time enter into an indenture or indentures supplemental hereto
(which shall comply with the provisions of the Trust Indenture Act as then in effect) for one or
more of the following purposes:



     (a) to convey, transfer, assign, mortgage or pledge to the Trustee as security for the
Subordinated Securities of one or more series any property or assets;



     (b) if deemed appropriate by the Company or required by law, to evidence the succession of
another Company to the Company or successive successions and the assumption by the successor
Company of the covenants, agreements and obligations of the Company pursuant to Article Four
hereof;



     (c) to add to the covenants of the Company such further covenants, restrictions or conditions
as its Board of Directors and the Trustee shall consider to be for the protection of the Holders of
all or any series of Subordinated Securities (and if such covenants, restrictions or conditions are
to be for the benefit of less than all series of Subordinated Securities, stating that such
covenants, restrictions or conditions are expressly being included solely for the benefit of such
series), and to make the occurrence, or the occurrence and continuance, of a default in any such
additional covenants, restrictions or conditions an Event of Default permitting the enforcement of
all or any of the several remedies provided in this Subordinated Indenture as herein set forth;
provided, however, that in respect to any such additional covenant, restriction or condition such
Supplemental Subordinated Indenture may provide for a particular period of grace after default
(which period may be shorter or longer than that allowed in the case of other defaults) or may
provide for an immediate enforcement upon such default or may limit the remedies available to the
Trustee upon such default;



     (d) to add or change any of the provisions of this Subordinated Indenture to such extent as
shall be necessary to facilitate the issuance of Subordinated Securities in (i) global form or (ii)
bearer form, registerable or not registerable as to principal or principal and interest, and with
or without coupons;



     (e) to change or eliminate any of the provisions of this Subordinated Indenture; provided,
however, that any such change or elimination shall become effective only when there is no
Subordinated Security of any series Outstanding created prior to the execution of such Supplemental
Subordinated Indenture which is entitled to the benefit of such provision;



     (f) to establish the form or terms of Subordinated Securities of any series as permitted by
Sections 2.01 and 2.03;



     (g) to appoint, at the request of the Trustee, a successor Trustee for a particular series of
Subordinated Securities to act as such pursuant to the provisions of this Subordinated Indenture
and to add to or change the provisions of this Subordinated Indenture to such extent as shall be
necessary to facilitate the performance of the duties of such trustee; and



     (h) to cure any ambiguity or to correct or supplement any provisions contained herein or in
any Supplemental Subordinated Indenture which may be defective or inconsistent with any other
provision contained herein or in any Supplemental Subordinated Indenture, or to make such other
provisions in regard to matters or questions arising under this Subordinated Indenture or any
Supplemental Subordinated Indenture which shall not adversely affect the interests of the Holders
of the Subordinated Securities.



     SECTION 10.02. Modification of Subordinated Indenture With Consent of Holders of
Subordinated Securities. With the consent (evidenced as provided in Section 8.01) of the
Holders of not less than a majority in principal amount of the Subordinated Securities of all
series at the time Outstanding (determined as provided in Section 8.04) affected by such
Supplemental Subordinated Indenture (voting as one class), the Company and the Trustee may from
time to time and at any time enter into an indenture or indentures supplemental hereto (which shall
comply with the provisions of the Trust Indenture Act as then in effect) for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions of this
Subordinated Indenture or of any Supplemental Subordinated Indenture or of modifying in any manner
the rights of the Holders of the Subordinated Securities of each such series; provided, however,
that no such Supplemental Subordinated Indenture shall, without the consent of the Holders of each
Outstanding Subordinated Security affect thereby:



     (a) change the Stated Maturity of the principal of, or any installment of principal of or
interest on, any Subordinated Security, or reduce the principal amount thereof or the rate of
interest thereon or any premium payable upon the redemption thereof, or reduce the amount of the
principal of an Original Issue Discount Subordinated Security or any other Subordinated Security
which would be due and payable upon a declaration of acceleration of the Stated Maturity thereof
pursuant to Section 6.01, or change any place of payment where, or the coin or currency in which,
any Subordinated Security or any premium or interest thereon is payable, or impair the right



41









 




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 date fixed for redemption), or modify the
provisions of this Subordinated Indenture with respect to this subordination of the Subordinated
Securities in a manner adverse to the Holders, or




     (b) Reduce the percentage in principal amount of the Outstanding Subordinated Securities the
consent of the Holders of which is required for any such Supplemental Subordinated Indenture, or
the consent of the Holders of which is required for any waiver (of compliance with certain
provisions of this Subordinated Indenture or certain defaults hereunder and their consequences)
provided for in this Subordinated Indenture or



     (c) Change the time of payment or reduce the amount of any minimum sinking account or fund
payment or



     (d) Modify any of the provisions of this Section 10.02, except to increase any such percentage
or to provide that certain other provisions of this Subordinated Indenture cannot be modified or
waived without the consent of the Holder of each Subordinated Security affected thereby.



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



     Upon the request of the Company, accompanied by a copy of a resolution of the Board of
Directors (which resolution may provide general terms or parameters for such action and may provide
that the specific terms of such action may be determined in accordance with or pursuant to a
Company Order) certified by the secretary or an assistant secretary of the Company authorizing the
execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of
the consent of the Holders of the Subordinated Securities as aforesaid and other documents, if any,
required by Section 8.01, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties
or immunities under this Subordinated Indenture or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such supplemental indenture.



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



     Promptly after the execution by the Company and the Trustee of any supplemental indenture
pursuant to the provisions to this Section, the Trustee shall give notice thereof to the Holders
of then Outstanding Registered Subordinated Securities of each series affected thereby, by mailing
a notice thereof by first—class mail to such Holders at their addresses as they shall appear on
the Security Register and in each case such notice shall set forth in general terms the substance
of such supplemental indenture. Any failure of the Company to give such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any such supplemental
indenture.



     SECTION 10.03. Effect of Supplemental Subordinated Indentures. Upon the execution of
any Supplemental Subordinated Indenture pursuant to the provisions of this Article Ten, this
Subordinated Indenture shall be and be deemed to be modified and amended in accordance therewith
and the respective rights, limitations of rights, obligations, duties and immunities under this
Subordinated Indenture of the Trustee, the Company and the Holders of Subordinated Securities shall
thereafter be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such Supplemental
Subordinated Indenture shall be and be deemed to be part of the terms and conditions of this
Subordinated Indenture for any and all purposes.



     The Trustee shall be entitled to receive, and subject to the provisions of Section 7.01 shall
be entitled to rely upon, an Opinion of Counsel as conclusive evidence that any such Supplemental
Subordinated Indenture complies with the provisions of this Article Ten and that the Subordinated
Securities affected by the Supplemental Subordinated Indenture, when such Subordinated Securities
are authenticated and delivered by the Trustee and executed and issued by the Company in the manner
and subject to any conditions specified in such Opinion of Counsel, will be valid and binding
obligations of the Company, except as any rights thereunder may be limited by bankruptcy,
insolvency and other similar laws affecting the enforcement of creditors’ rights generally and by
general equity principles.



42









 





     SECTION 10.04. Subordinated Securities May Bear Notation of Changes by Supplemental
Subordinated Indentures. Subordinated Securities authenticated and delivered after the
execution of any Supplemental Subordinated Indenture pursuant to the provisions of this Article
Ten, or after any action taken at a Subordinated Securityholders’ meeting pursuant to Article Nine,
may bear a notation in form approved by the Trustee as to any matter provided for in such
Supplemental Subordinated Indenture or as to any action taken at any such meeting. If the Company
or the Trustee shall so determine, new Subordinated Securities so modified as to conform, in the
opinion of the Trustee and the Company, to any modification of this Subordinated Indenture
contained in any such Supplemental Subordinated Indenture may be prepared by the Company,
authenticated by the Trustee and delivered in exchange for the Subordinated Securities then
Outstanding.



ARTICLE ELEVEN




DISCHARGE; DEFEASANCE




     SECTION 11.01. Satisfaction and Discharge of Subordinated Indenture.



          (A) If at any time (i) the Company shall have paid or caused to be paid the principal of and
interest on all the Subordinated Securities of any series Outstanding hereunder (other than
Subordinated Securities of such series which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.09) as and when the same shall have become due and
payable, or (ii) the Company shall have delivered to the Trustee for cancellation all Subordinated
Securities of any series theretofore authenticated (other than any Subordinated Securities of such
series which shall have been destroyed, lost or stolen and which shall have been replaced or paid
as provided in Section 2.09) or (iii) in the case of any series of Subordinated Securities where
the exact amount (including the currency of payment) of principal of and interest due on which can
be determined at the time of making the deposit referred to in clause (b) below, (a) all the
Subordinated Securities of such series not theretofore delivered to the Trustee for cancellation
shall have become due and payable, or are by their terms to become due and payable within one year
or are to be called for redemption within one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption, and (b) the Company shall have irrevocably deposited or
caused to be deposited with the Trustee as trust funds in trust the entire amount in (i) cash
(other than moneys repaid by the Trustee or any Paying Agent to the Company in accordance with
Section 11.04), (ii) in the case of any series of Subordinated Securities the payments on which may
only be made in Dollars, direct obligations of the United States of America, backed by its full
faith and credit (“U.S. Government Obligations”), maturing as to principal and interest at such
times and in such amounts as will insure the availability of cash sufficient to pay at such
Maturity or upon such redemption, as the case may be, or (iii) a combination thereof, sufficient,
in the opinion of a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay (a) the principal and interest on
all Subordinated Securities of such series on each date that such principal or interest is due and
payable in accordance with the terms of the Subordinated Indenture and the Subordinated Securities
of such series; (x) the principal and interest on all Subordinated Securities of such series on
each date that such principal or interest is due and payable and in accordance with the terms of
the Subordinated Indenture and the Subordinated Securities of such series; and if, in any such
case, the Company shall also pay or cause to be paid all other sums payable hereunder by the
Company, then this Subordinated Indenture shall cease to be of further effect (except as to (i)
rights of registration of transfer and exchange of Subordinated Securities of such series and the
Company’s right of optional redemption, if any, (ii) substitution of mutilated, defaced, destroyed,
lost or stolen Subordinated Securities, (iii) rights of Holders of Subordinated Securities to
receive payments of principal thereof and interest thereon, upon the original stated due dates
therefore (but not upon acceleration), (iv) any optional redemption rights of such series of
Subordinated Securities to the extent to be exercised to make such call for redemption within one
year, (v) the rights, obligations, duties and immunities of the Trustee hereunder, including
without limitation those under Section 7.6, (vi) the rights of the Holders of securities of such
series as beneficiaries hereof with respect to the property so deposited with the Trustee payable
to all or any of them, and (vii) the obligations of the Company under Section 4.03 and the Trustee,
on demand of the Company accompanied by an Officer’s Certificate and an Opinion of Counsel and at
the cost and expense of the Company, shall execute proper instruments acknowledging such
satisfaction of and discharging this Subordinated Indenture; provided, that the rights of Holders
of the Subordinated Securities to receive amounts in respect of principal of and interest on the
Subordinated Securities held by them shall not be delayed longer than required by then applicable
mandatory rules or policies of any securities exchange upon which the Subordinated Securities are
listed. The Company agrees to reimburse the Trustee for any costs or expenses thereafter reasonably
and properly incurred and to compensate the Trustee for any services thereafter reasonably and
properly rendered by the Trustee in connection with this Subordinated Indenture or the Subordinated
Securities of such series.




43









 








          (B) The following provisions shall apply to the Subordinated Securities of each series unless
specifically otherwise provided in an Officer’s Certificate or indenture supplemental hereto
provided pursuant to Section 2.03. In addition to discharge of the Subordinated Indenture pursuant
to the next preceding paragraph, in the case of any series of Subordinated Securities the exact
amounts (including the currency of payment) of principal of and interest due on which can be
determined at the time of making the deposit referred to in clause (a) below, the Company shall be
deemed to have paid and discharged the entire indebtedness on all the Subordinated Securities of
such a series on the date of the deposit referred to in clause (a) below, and the provisions of
this Subordinated Indenture with respect to the Subordinated Securities of such series shall no
longer be in effect (except as to (i) rights of registration of transfer and exchange of
Subordinated Securities of such series and the Company’s right of optional redemption, if any, (ii)
substitution of mutilated, defaced, destroyed, lost or stolen Subordinated Securities, (iii) rights
of Holders of Subordinated Securities to receive payments of principal thereof and interest
thereon, upon the original stated due dates therefor (but not upon acceleration), (iv) any optional
redemption rights of such series of Subordinated Securities to the extent to be exercised to make
such call for redemption within one year, (v) the rights, obligations, duties and immunities of the
Trustee hereunder, (vi) the rights of the Holders of Subordinated Securities of such series as
beneficiaries hereof with respect to the property so deposited with the Trustee payable to all or
any of them and (vii) the obligations of the Company under Section 4.03 and the Trustee, at the
expense of the Company, shall at the Company’s request, execute proper instruments acknowledging
the same, if





     (a) with reference to this provision the Company has irrevocably deposited or caused to be
irrevocably deposited with the Trustee as trust funds in trust, specifically pledged as security
for, and dedicated solely to, the benefit of the Holders of the Subordinated Securities of such
series (i) cash in an amount, or (ii) in the case of any series of Subordinated Securities the
payments on which may only be made in United States Dollars, U.S. Government Obligations,
maturing as to principal and interest at such times and in such amounts as will insure the
availability of cash or (iii) a combination thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay the principal and interest on all Subordinated Securities of
such series on each date that such principal or interest is due and payable in accordance with
the terms of the Subordinated Indenture and the Subordinated Securities of such series;




     (b) such deposit will not result in a breach or violation of, or constitute a default under,
any agreement or instrument to which the Company is a party or by which it is bound;




     (c) the Company has delivered to the Trustee an Opinion of Counsel based on the fact that
(x) the Company has received from, or there has been published by, the IRS a ruling or (y) since
the date hereof, there has been a change in the applicable Federal income tax law, in either case
to the effect that, and such opinion shall confirm that, the Holders of the Subordinated
Securities of such series will not recognize income, gain or loss for United States Federal
income tax purposes as a result of such deposit, defeasance and discharge and will be subject to
United States Federal income tax on the same amount and in the same manner and at the same times,
as would have been the case if such deposit, defeasance and discharge had not occurred;




     (d) no event or condition exists that, based on the subordination provisions applicable to
the Subordinated Securities of such series, would prevent the Company from making payments of
principal of, premium, if any, and interest on any of the applicable Subordinated Securities at
the date of the irrevocable deposit referred to in Section 11.01(B)(a) above or at any time
during the period ending on the 91st day after such deposit date; and




     (e) the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided for relating to the defeasance
contemplated by this provision have been complied with.



     (C) The Company shall be released from its obligations under Sections 4.02 and unless
otherwise provided for in the Board Resolution, Officer’s Certificate or Subordinated Indenture
supplemental hereto establishing such series of Subordinated Securities, from all covenants and
other obligations referred to in Section 2.03(18) or 2.03(20) with respect to such series of
Subordinated Securities outstanding on and after the date the conditions set forth below are
satisfied (hereinafter, “covenant defeasance”). For this purpose, such covenant defeasance means
that, with respect to the Outstanding Subordinated Securities of any series, the Company may omit
to comply with and shall have no liability in respect of any term, condition or limitation set
forth in such Section, whether directly or indirectly by reason of any reference elsewhere herein
to such Section or by reason of any reference in such Section to any other provision herein or in
any other document and such omission to comply shall not constitute an Event of Default under
Section 6.01, but the remainder of this Subordinated Indenture and such Subordinated Securities
shall be unaffected thereby. The following shall be the conditions to application of this
subsection C of this Section 11.01:



44









 






     (a) The Company has irrevocably deposited or caused to be deposited with the Trustee as
trust funds in trust for the purpose of making the following payments, specifically pledged as
security for, and dedicated solely to, the benefit of the holders of the Subordinated Securities
of such series (i) cash in an amount, or (ii) in the case of any series of Subordinated
Securities the payments on which may only be made in United States Dollars, U.S. Government
Obligations maturing as to principal and interest at such times and in such amounts as will
insure the availability of cash or (iii) a combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay the principal and interest on all Subordinated
Securities of such series in accordance with the terms of the Subordinated Indenture and the
Subordinated Securities of such series;




     (b) No Event of Default or event which with notice or lapse of time or both would become an
Event of Default with respect to the Subordinated Securities shall have occurred and be
continuing on the date of such deposit;




     (c) Such covenant defeasance shall not cause the Trustee to have a conflicting interest as
defined in Section 7.08 and for purposes of the Trust Indenture Act with respect to any
securities of the Company;




     (d) Such covenant defeasance shall not result in a breach or violation of, or constitute a
default under, this Subordinated Indenture or any other agreement or instrument to which the
Company is a party or by which it is bound;




     (e) Such covenant defeasance shall not cause any Subordinated Securities then listed on any
registered national securities exchange under the Exchange Act to be delisted;




     (f) The Company shall have delivered to the Trustee an Officer’s Certificate and Opinion of
Counsel to the effect that the Holders of the Subordinated Securities of such series will not
recognize income, gain or loss for United States Federal income tax purposes as a result of such
covenant defeasance and will be subject to United States Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if such covenant defeasance
had not occurred; and




     (g) The Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion
of Counsel, each stating that all conditions precedent provided for relating to the covenant
defeasance contemplated by this provision have been complied with.



     SECTION 11.02. Application by Trustee of Funds Deposited for Payment of Subordinated
Securities. Subject to Section 11.04, all moneys deposited with the Trustee (for other trustee)
pursuant to Section 11.01 shall be held in trust and applied by it to the payment, either directly
or through any Paying Agent (including the Company acting as its own Paying Agent), to the Holders
of the particular Subordinated Securities of such series for the payment or redemption of which
such moneys have been deposited with the Trustee, of all sums due and to become due thereon for
principal and interest; but such money need not be segregated from other funds except to the extent
required by law.



     SECTION 11.03. Repayment of Moneys Held by Paying Agent. In connection with the
satisfaction and discharge of this Subordinated Indenture with respect to Subordinated Securities
of any series, all moneys then held by any Paying Agent under the provisions of this Subordinated
Indenture with respect to such series of Subordinated Securities shall, upon demand of the Company,
be repaid to it or paid to the Trustee and thereupon such Paying Agent shall be released from all
further liability with respect to such moneys.



     SECTION 11.04. Return of Moneys Held by Trustee and Paying Agent Unclaimed for Two
Years. Any moneys deposited with or paid to the Trustee or any Paying Agent for the payment of
the principal of and any premium and interest on any Subordinated Security and not so applied but
remaining unclaimed under applicable law shall be transferred by the Trustee to the appropriate
Persons in accordance with applicable laws, and the Holder of such Subordinated Security of such
series shall thereafter look only to such Persons for any payment which such Holder may be entitled
to collect and all liability of the Trustee and such Paying Agent with respect to such moneys shall
thereupon cease.



     SECTION 11.05. Indemnity for U.S. Government of Obligations. The Company shall pay and
indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 11.01 or the principal or interest received in
respect of such obligations.



45









 





ARTICLE TWELVE




IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS

AND DIRECTORS




     SECTION 12.01. Incorporators, Stockholders, Officers and Directors of Company Exempt From
Individual Liability. No recourse under or upon any obligation, covenant or agreement of this
Subordinated Indenture, or of any Subordinated Security, or for any claim based thereon or
otherwise in respect thereof, shall be had against any incorporator, stockholder, officer or
director, as such past, present or future, of the Company, either directly or through the Company,
whether by virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that this Subordinated Indenture
and the obligations issued hereunder are solely corporate obligations, and that no personal
liability whatever shall attach to, or is or shall be incurred by, the incorporators, stockholders,
officers or directors, as such, of the Company because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements contained in this
Subordinated Indenture or in any of the Subordinated Securities or implied therefrom; and that any
and all such personal liability of every name and nature, either at common law or in equity or by
constitution or statute, of, and any and all such rights and claims against, every such
incorporator, stockholder, officer or director, as such, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements
contained in this Subordinated Indenture or in any of the Subordinated Securities or implied
therefrom are hereby expressly waived and released as a condition of, and as a consideration for,
the execution of this Subordinated Indenture and the issue of such Subordinated Securities.



ARTICLE THIRTEEN




MISCELLANEOUS PROVISIONS




     SECTION 13.01. Successors and Assigns of the Company bound by Subordinated Indenture.
All the covenants, stipulations, promises and agreements in this Subordinated Indenture contained
by or in behalf of the Company shall bind its successors and assigns, whether so expressed or not.



     SECTION 13.02. Notices; Effectiveness. Any notice or demand which by any provision of
this Subordinated Indenture is required or permitted to be given or served by the Trustee or by the
Holders of Subordinated Securities to or on the Company, or by the Company or by the Holders of
Subordinated Securities to the Trustee or upon the Depository by the Company or the Trustee may be
electronically communicated or hand delivered or sent by overnight courier, addressed to the
relevant party as provided in this Section 13.02.



     All communications intended for the Company shall be sent to:


Diamond Foods, Inc.

600 Montgomery Street, 17th Floor

San Francisco, California 94111

Attention: General Counsel




     All communications intended for the Trustee shall be sent to:


Wells Fargo Bank, N.A.

707 Wilshire Blvd., 17th Floor

Los Angeles, CA 90017

Attention: Corporate Trust Department



or at any other address of which any of the foregoing shall have notified the others in any manner
prescribed in this Section 13.02.




     For all purposes of this Subordinated Indenture, a notice or communication will be deemed
effective:



46









 





     (a) if delivered by hand or sent by overnight courier, on the day it is delivered unless (i)
that day is not a Business Day in the city specified (a “Local Business Day”) in the address for
notice provided by the recipient or (ii) if delivered after the close of business on a Local
Business Day, then on the next succeeding Local Business Day or



     (b) if sent by facsimile transmission, on the date transmitted, provided that oral or written
confirmation of receipt is obtained by the sender unless the date of transmission and confirmation
is not a Local Business Day, in which case, on the next succeeding Local Business Day.



     Any notice, direction, requires, demand, consent or waiver by the Company, any Subordinated
Securityholder to or upon the Trustee shall be deemed to have been sufficiently given, made or
filed, for all purposes, if given, made or filed in writing at the Principal Office of the Trustee
in accordance with the provisions of this Section 13.02.



     Any notice, request, consent or waiver by the Company or the Trustee upon the Depository shall
have been sufficiently given, made or filed, for all purposes, if give or made in accordance with
the provisions of this Section 13.02 at the address shown for such Depository in the Register or at
such other address as the Depository shall have provided for purposes of notice.



     SECTION 13.03. Compliance Certificates and Opinions. Upon on any request or
application by the Company to the Trustee to take any action under any of the provisions of this
Subordinated Indenture, the Company shall furnish to the Trustee an Officer’s Certificate stating
that all conditions precedent, if any, provided for in this Subordinated Indenture relating to the
proposed action have been complied with and an Opinion of Counsel stating that in the opinion of
such counsel all such conditions precedent have been complied with, except that in the case of any
such application or demand as to which the furnishing of such document is specifically required by
any provision of this Subordinated Indenture relating to such particular application or demand, no
additional certificate or opinion need be furnished.



     Each certificate or opinion provided for in this Subordinated Indenture and delivered to the
Trustee with respect to compliance with a condition or covenant provided for in this Subordinated
Indenture (other than a certificate provided pursuant to Section 5.03(d) shall include (a) a
statement that the Person making such certificate or opinion has read such covenant or condition;
(b) 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; (c) a statement that, in
the opinion of such Person, he or she has made such examination or investigation as is necessary to
enable such Person to express an informed opinion as to whether or not such covenant or condition
has been complied with; and (d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.



     Any certificate, statement 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 that the certificate or opinion or representations with respect to the matters
upon which such certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any certificate, statement
or Opinion of Counsel may be based, insofar as it relates to factual matters, upon the certificate,
statement or opinion of or representations by an officer or officers of the Company stating that
the information with respect to such factual matters is in the possession of the Company, unless
such counsel knows that the certificate, statement or opinion or representations with respect to
the matters upon which such Person’s certificate, statement or opinion may be based as aforesaid
are erroneous, or in the exercise of reasonable care should know that the same are erroneous.



     Any certificate, statement or opinion of an officer of the Company or of counsel may be based,
insofar as it relates to accounting matters, upon a certificate or opinion of or representations by
an accountant or firm of accountants, unless such officer or counsel, as the case may be, knows
that the certificate or opinion or representations with respect to the accounting matters upon
which his or her certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any certificate or opinion
of any firm of independent public accountants filed with the Trustee shall contain a statement that
such firm is independent.



     SECTION 13.04. Days on Which Payment to be Made, Notice Given or Other Action Taken.
If any date on which a payment is to be made, notice given or other action taken hereunder is a
Saturday, Sunday or legal holiday in the state in which the payment, notice or other action is to
be made, given or taken, then such payment, notice or other action shall be made, given or taken on
the next succeeding Business Day in such state, and in the case of any payment, no interest shall
accrue for the delay.



47









 





     SECTION 13.05. Provisions Required by Trust Indenture Act to Control. If and to the
extent that any provision of this Subordinated Indenture limits, qualifies or conflicts with
another provision included in this Subordinated Indenture which is required to be included in this
Subordinated Indenture by any of Sections 310 to 317, inclusive, of the Trust Indenture Act such
required provision shall control.



     SECTION 13.06. Governing Law and Waiver of Trial By Jury. THIS SUBORDINATED INDENTURE
AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR
ANY SUCCESSOR TO SUCH STATUTE). THE TRUSTEE AND THE COMPANY AGREE TO SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, IN
THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR
THE SECURITIES. THIS INDENTURE IS SUBJECT TO THE PROVISIONS OF THE TRUST INDENTURE ACT THAT ARE
REQUIRED TO BE PART OF THIS INDENTURE AND SHALL, TO THE EXTENT APPLICABLE, BE GOVERNED BY SUCH
PROVISIONS.



     THE TRUSTEE AND THE COMPANY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS
THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS INDENTURE OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE TRUSTEE OR THE COMPANY RELATING THERETO. THE COMPANY
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE TRUSTEE AND THE HOLDERS ENTERING INTO THIS
INDENTURE.



     SECTION 13.07. Effect of Headings. The Article and Section headings herein and the
Table of Contents are for convenience only and shall not affect the construction hereof.



     SECTION 13.08. Judgment Currency. The Company agrees, to the fullest extent that it
may effectively do so under applicable law, that (a) if for the purpose of obtaining judgment in
any court it is necessary to convert the sum due in respect of the principal of or interest on the
Subordinated Securities of any series (the “Required Currency”), into a currency in which a
judgment will be rendered (the “Judgment Currency”), the rate of exchange used shall be the rate at
which in accordance with normal banking procedures the Trustee could purchase in The City of New
York the Required Currency with the Judgment Currency on the day on which final unappealable
judgment is entered, unless such day is not a New York Banking Day, then, to the extent permitted
by applicable law, the rate of exchange used shall be the rate at which in accordance with normal
banking procedures the Trustee could purchase in The City of New York the Required Currency with
the Judgment Currency on the New York Banking Day preceding the day on which final unappealable
judgment is entered and (b) its obligations under this Subordinated Indenture to make payments in
the Required Currency (i) shall not be discharged or satisfied by any tender, or any recovery
pursuant to any judgment (whether or not entered in accordance with subsection (a)), in any
currency other than the Required Currency, except to the extent that such tender or recovery shall
result in the actual receipt, by the payee, of the full amount of the Required Currency expressed
to be payable in respect of such payments, (ii) shall be enforceable as an alternative or
additional cause of action for the purpose of recovering in the Required Currency the amount, if
any, by which such actual receipt shall fall short of the full amount of the Required Currency so
expressed to be payable and (iii) shall not be affected by judgment being obtained for any other
sum due under this Subordinated Indenture. The Company agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Trustee against loss if Dollars so purchased
are less than the sum originally due to the Trustee in Dollars. For purposes of the foregoing, “New
York Banking Day” means any day except a Saturday, Sunday or a legal holiday in The City of New
York or a day on which banking institutions in The City of New York are authorized or required by
law or executive order to close.



     SECTION 13.09. Provisions of the Subordinated Indenture and Subordinated Securities for
the Sole Benefit of the Parties and the Subordinated Securityholders. Nothing in this
Subordinated Indenture or in the Subordinated Securities, expressed or implied, shall give or be
construed to give any Person, firm or Company, other than the parties hereto and the Holders of the
Subordinated Securities, any legal or equitable right, remedy or claim under or in respect of this
Subordinated Indenture, or under any covenant, condition and provision herein contained; all its
covenants, conditions and provisions being for the sole benefit of the parties hereto and of the
Holders of the Subordinated Securities.



48









 





     SECTION 13.10. Subordinated Indenture May be Executed in Counterparts. This
Subordinated Indenture may be executed in any number of counterparts, each of which shall be an
original; but such counterparts shall together constitute but one and the same instrument.



     SECTION 13.11. Facsimile or PDF. The exchange of copies of this Indenture and of signature
pages by facsimile or PDF transmission shall constitute effective execution and delivery of this
Indenture as to the parties hereto and may be used in lieu of the original Indenture for all
purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be
their original signatures for all purposes.



     SECTION 13.12. 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 beyond its control, including, without limitation, strikes, acts of
war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God,
and interruptions or loss of utilities; 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.



     SECTION 13.13. U.S.A. Patriot Act. The parties hereto acknowledge that in accordance with
Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to
help fight the funding of terrorism and money laundering, is required to obtain, verify, and record
information that identifies each person or legal entity that establishes a relationship or opens an
account with the Trustee. The parties to this Indenture agree that they will provide the Trustee
with such information as it may request in order for the Trustee to satisfy the requirements of the
U.S.A. Patriot Act.



ARTICLE FOURTEEN




SUBORDINATION OF SECURITIES




     SECTION 14.01. Subordinated Securities Subordinated to Senior Indebtedness. The
Company covenants and agrees, and each Holder of Subordinated Securities, by his acceptance
thereof, likewise covenants and agrees, that the indebtedness represented by the Subordinated
Securities and the payment of the principal of (and premium, if any) in respect of each and all of
the Subordinated Securities is hereby expressly subordinated, to the extent and in the manner
hereinafter set forth, in right of payment to the prior payment in full of Senior Indebtedness.



     In the event (a) of any distribution of assets of the Company upon any dissolution, winding
up, liquidation or reorganization of the Company whether in bankruptcy, insolvency, reorganization
or receivership proceeding or upon an assignment for the benefit of creditors or any other
marshalling of the assets and liabilities of the Company or otherwise, except a distribution in
connection with a member or consolidation or a conveyance or transfer of all or substantially all
of the properties of the Company which complies with the requirements of Section 4.02, or (b) that
a default shall have occurred and be continuing with respect to the payment of principal of (or
premium, if any) in respect of any Senior Indebtedness, or (c) that the principal of the
Subordinated Securities of any series (or in the case of Original Issue Discount Securities, the
portion of the principal amount thereof referred to in Section 6.01) shall have been declared due
and payable pursuant to Section 6.01 and such declaration shall not have been rescinded and
annulled as provided in Section 6.01, then:



     (1) in a circumstance described in the foregoing clause (a) or (b) the holders of all Senior
Indebtedness, and in the circumstance described in the foregoing clause (c) the holders of all
Senior Indebtedness outstanding at the time the principal of such Subordinated Securities (or in
the case of Original Issue Discount Securities, such portion of the principal amount) shall have
been so declared due and payable, shall first be entitled to receive payment of the full amount due
thereon in respect of principal, premium (if any), interest, or provision shall be made for such
payment in money or money’s worth, before the Holders of any of the Subordinated Securities are
entitled to receive any payment on account of the principal of (or premium, if any) or interest
payable in respect of the indebtedness evidenced by the Subordinated Securities;



     (2) any payment by, or distribution of assets of, the Company of any kind of character,
whether in cash, property or securities (other than securities of the Company as reorganized or
readjusted or securities of the Company or any other corporation provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to the extent provided
in this Article with respect to the securities, to the payment of all Senior Indebtedness, provided
that the rights of the holders of the Senior Indebtedness are not altered by such reorganization or
readjustment), to which the Holders of any of the Subordinated Securities would be entitled



49









 




except for the provisions of this Article shall be paid or delivered by the person making such
payment or distribution, whether a trustee in bankruptcy, a receive or liquidating trustee or
otherwise, directly to the holders of such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture under which any instrument
evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate
amounts remaining unpaid on account of such Senior Indebtedness held or represented by each, to the
extent necessary to make payment in full of all Senior Indebtedness remaining unpaid after giving
effect to any concurrent payment or distribution (or provision therefore) to the holders of such
Senior Indebtedness, before any payment or distribution is made to the Holders of the indebtedness
evidenced by the Subordinated Securities under this Subordinated Indenture; and




     (3) in the event that, notwithstanding the foregoing, any payment by, or distribution of
assets of, the Company of any kind of character, whether in cash, property or securities (other
than securities of the Company as reorganized or readjusted or securities of the Company or any
other corporation provided for by a plan of reorganization or readjustments the payment of which is
subordinate, at least to the extent provided in this Article with respect to the Subordinated
Securities, to the payment of all Senior Indebtedness, provided that the rights of the holders of
Senior Indebtedness are not altered by such reorganization or readjustment), shall be received by
the Holders of any of the Subordinated Securities before all Senior Indebtedness is paid in full,
such payment or distribution shall be paid over to the holders of such Senior Indebtedness or their
representative or representatives or to the trustee or trustees under any indenture under which any
instruments evidencing any of such Senior Indebtedness may have been issued, ratably as aforesaid,
for application to the payment of all Senior Indebtedness remaining unpaid until all such Senior
Indebtedness shall have been paid in full, after giving effect to any concurrent payment or
distribution (or provision therefor) to the holders of such Senior Indebtedness.



     SECTION 14.02. Subrogation. Subject to the payment in full of all Senior Indebtedness
to which the indebtedness evidenced by the securities is in the circumstances subordinated as
provided in Section 14.01, the Holders of the Subordinated Securities shall be subrogated to the
rights of the holders of such Senior Indebtedness to receive payments or distributions of cash,
property or Subordinated Securities of the Company applicable to such Senior Indebtedness until all
amounts owing on the Subordinated Securities shall be paid in full, and, as between the Company,
its creditors other than holders of such Senior Indebtedness, and the Holders of the Subordinated
Securities, no such payment or distribution made to the holders of such Senior Indebtedness by
virtue of this Article which otherwise would have been made to the Holders of the Subordinated
Securities shall be deemed to be a payment by the Company on account of such Senior Indebtedness,
it being understood that the provisions of this Article are and are intended solely for the purpose
of defining the relative rights of the Holders of the Subordinated Securities, on the one hand, and
the holders of Senior Indebtedness.



     SECTION 14.03. Obligation of the Company Unconditional. Nothing contained in this
Article or elsewhere in this Subordinated Indenture or in the Subordinated Securities is intended
to or shall impair, as between the Company, its creditors other than the holders of Senior
Indebtedness, and the Holders of the Subordinated Securities, the obligation of the Company, which
is absolute and unconditional, to pay to the Holders of the Subordinated Securities the principal
of (and premium, if any) and interest payable in the respect of the Subordinated Securities as and
when the same shall become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Holders of the Subordinated Securities and creditors of the
Company other than the holders of Senior Indebtedness nor shall anything herein or therein prevent
the Trustee or the Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Subordinated Indenture, subject to the rights, if any, under
this Article of the holders of Senior Indebtedness in respect of cash, property or Subordinated
Securities of the Company received upon the exercise of any such remedy.



     Upon any payment or distribution of assets of the Company referred to in this Article, the
Trustee and the Holders of the Subordinated Securities shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which any such dissolution, winding up,
liquidation or reorganization proceeding affecting the affairs of the Company is pending or upon a
certificate of the trustee in bankruptcy, receiver, assignee for the benefit of creditors,
liquidating trustee or agent or other person making any payment or distribution, delivered to the
Trustee or to the Holders of the Subordinated Securities, for the purpose of ascertaining the
persons entitled to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon, the
amount paid or distributed thereon and all other facts pertinent thereto or to this Article.



     SECTION 14.04. Payments on Subordinated Securities Permitted. Nothing contained in
this Article or elsewhere in this Subordinated Indenture, or in any of the Subordinated Securities,
shall affect the obligation of the Company to make, or prevent the



50









 







Company from making, payment of the principal of (or premium, if any) or interest payable in
respect of the Subordinated Securities in accordance with the provisions hereof and thereof, except
as otherwise provided in this Article.



     SECTION 14.05. Effectuation of Subordinated by Trustee. Each holder of the
Subordinated Securities, by his acceptance thereof, authorizes and directs the Trustee in his
behalf to take such action as may be necessary or appropriate to effectuate the subordination
provided in this Article and appoints the Trustee his attorney-in-fact for any and all such
purposes.



     SECTION 14.06. Knowledge of Trustee. Notwithstanding the provisions of this Article or
any other provisions of this Subordinated Indenture, the Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness and shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any payment or moneys to or by the
Trustee, or the taking of any other action by the Trustee, unless and until the Trustee shall have
received written notice thereof from the Company, any Holder of Subordinated Securities, any paying
or conversion agent of the Company or the holder or representative of any class of Senior
Indebtedness; provided, however, that if the Trustee shall not have received the notice provided
for in this Section at least three Business Days prior to the date upon which, by the terms hereof,
any money may become payable for any purpose (including, without limitation, the payment of the
principal of (or premium, if any) or interest on any Subordinated Security) then, anything herein
contained to the contrary notwithstanding, the Trustee shall have all power and authority to
receive such money and to apply the same to the purpose for which such money was received and shall
not be affected by any notice to the contrary which may be received by it during or after such
three Business Day period.



     SECTION 14.07. Trustee May Hold Senior Indebtedness. The trustee in its individual
capacity shall be entitled to all the rights set forth in this Article with respect to any Senior
Indebtedness at the time held by it, to the same extent ads any other holder of Senior
Indebtedness, and nothing in Section 313 of the Trust Indenture Act or elsewhere in this
Subordinated Indenture shall deprive the Trustee of any of its rights as such holder.



     Nothing in this Article shall subordinate any claims of, or payments to, the Trustee (under or
pursuant to Section 7.06) to Senior Indebtedness.



     SECTION 14.08. Rights of Holders of Senior Indebtedness Not Impaired. No right of any
present or future holder of any Senior Indebtedness to enforce the subordination herein shall at
any time or in any way be prejudiced or impaired by any act or failure to act on the part of the
Company or by any non-compliance by the Company with the terms, provisions and covenants of this
Subordinated Indenture, regardless of any knowledge thereof any such holder may have or be
otherwise charged with.



[Signature page follows]




51









 








     IN WITNESS WHEREOF, DIAMOND FOODS, INC. has caused this Subordinated Indenture to be signed by
its Chairman of the Board or any Vice-Chairman of the Board or its President or Chief Financial
Officer or one of its Vice Presidents and Trustee has caused this Subordinated Indenture to be
signed and acknowledged by one of its Vice Presidents, all as of the day and year first written
above.



	 	 	 	 	 
	 	DIAMOND FOODS, INC.

 	 
	 	By  	 	 
	 	 	Title: 	 	 
	 	 	 	 
	 
	 	Wells Fargo Bank, N.A.,

as Trustee

 	 
	 	By  	 	 
	 	 	Vice President 	 
	 	 	 	 
	 




52