HF FINANCIAL CORP.

 

an Issuer

 

 

INDENTURE

 

Dated as of November 28,2001

 

 

 

WILMINGTON TRUST COMPANY

 

as Trustee

 

 

FLOATING RATE JUNIORSUBORDINATED DEBT SECURITIES DUE 2031

 

 

 

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| ARTICLE I                                         |
|---------------------------------------------------|
| DEFINITIONS                                       |
| Section  1.01                                     |   | Definitions |   |   |
| ARTICLE II                                        |
| DEBT SECURITIES                                   |
| Section  2.01                                     |   | Authentication  and Dating |   |   |
| Section  2.02                                     |   | Form of  Trustee’s Certificate of Authentication |   |   |
| Section  2.03                                     |   | Form and  Denomination of Debt Securities |   |   |
| Section  2.04                                     |   | Execution  of Debt Securities |   |   |
| Section  2.05                                     |   | Exchange  and Registration of Transfer of Debt Securities |   |   |
| Section  2.06                                     |   | Mutilated,  Destroyed, Lost or Stolen Debt Securities |   |   |
| Section  2.07                                     |   | Temporary  Debt Securities |   |   |
| Section  2.08                                     |   | Payment of  Interest |   |   |
| Section  2.09                                     |   | Cancellation  of Debt Securities Paid, etc |   |   |
| Section  2.10                                     |   | Computation  of Interest |                 |   |
| Section  2.11                                     |   | Extension  of Interest Payment Period |   |   |
| Section  2.12                                     |   | CUSIP Numbers.. |   |   |
| ARTICLE III                                       |
| PARTICULAR COVENANTS OF THE COMPANY               |
| Section  3.01                                     |   | Payment of  Principal, Premium and Interest; Agreed Treatment of the Debt Securities |   |   |
| Section  3.02                                     |   | Offices for  Notices and Payments, etc |   |   |
| Section  3.03                                     |   | Appointments  to Fill Vacancies in Trustee’s Office |   |   |
| Section  3.04                                     |   | Provision  as to Paying Agent |   |   |
| Section  3.05                                     |   | Certificate  to Trustee |   |   |
| Section  3.06                                     |   | Additional  Interest |   |   |
| Section  3.07                                     |   | Compliance  with Consolidation Provisions |   |   |
| Section  3.08                                     |   | Limitation  on Dividends |   |   |
| Section  3.09                                     |   | Covenants  as to the Trust |   |   |
| ARTICLE IV                                        |
| LISTS AND REPORTS BY THE COMPANY AND THE  TRUSTEE |
| Section  4.01                                     |   | Securityholders’  Lists . |   |   |
| Section  4.02                                     |   | Preservation  and Disclosure of Lists. |   |   |

 

 

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| ARTICLE V                                                             |
|-----------------------------------------------------------------------|
| REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS  UPON AN EVENT OF DEFAULT |
| Section  5.01                                                         |   | Events of  Default |   |   |
| Section  5.02                                                         |   | Payment of  Debt Securities on Default; Suit Therefor |   |   |
| Section  5.03                                                         |   | Application  of Moneys Collected by Trustee |   |   |
| Section  5.04                                                         |   | Proceedings  by Securityholders |   |   |
| Section  5.05                                                         |   | Proceedings  by Trustee |   |   |
| Section  5.06                                                         |   | Remedies  Cumulative and Continuing |   |   |
| Section  5.07                                                         |   | Direction  of Proceedings and Waiver of Defaults by Majority of Securityholders |   |   |
| Section  5.08                                                         |   | Notice of  Defaults |   |   |
| Section  5.09                                                         |   | Undertaking  to Pay Costs |   |   |
| ARTICLE VI                                                            |
| CONCERNING THE TRUSTEE                                                |
| Section  6.01                                                         |   | Duties and  Responsibilities of Trustee |   |   |
| Section  6.02                                                         |   | Reliance on  Documents, Opinions, etc |   |   |
| Section  6.03                                                         |   | No  Responsibility for Recitals, etc |   |   |
| Section  6.04                                                         |   | Trustee,  Authenticating Agent, Paying Agents, Transfer Agents or Registrar May Own  Debt Securities |   |   |
| Section  6.05                                                         |   | Moneys to  be Held in Trust |   |   |
| Section  6.06                                                         |   | Compensation  and Expenses of Trustee |   |   |
| Section  6.07                                                         |   | Officers’  Certificate as Evidence |   |   |
| Section  6.08                                                         |   | Eligibility  of Trustee |   |   |
| Section  6.09                                                         |   | Resignation  or Removal of Trustee |   |   |
| Section  6.10                                                         |   | Acceptance  by Successor Trustee |   |   |
| Section  6.11                                                         |   | Succession  by Merger, etc |   |   |
| Section  6.12                                                         |   | Authenticating  Agents |   |   |

 

 

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| ARTICLE VII                    |
|--------------------------------|
| CONCERNING THE SECURITYHOLDERS |
| Section  7.01                  |   | Action by  Securityholders |   |   |
| Section  7.02                  |   | Proof of  Execution by Securityholders |   |   |
| Section  7.03                  |   | Who Are  Deemed Absolute Owners |   |   |
| Section  7.04                  |   | Debt  Securities Owned by Company Deemed Not Outstanding |   |   |
| Section  7.05                  |   | Revocation  of Consents; Future Holders Bound |   |   |
| ARTICLE VIII                   |
| SECURITYHOLDERS’ MEETINGS |
| Section  8.01                  |   | Purposes of  Meetings |   |   |
| Section  8.02                  |   | Call of  Meetings by Trustee |   |   |
| Section  8.03                  |   | Call of  Meetings by Company or Securityholders |   |   |
| Section  8.04                  |   | Qualifications  for Voting |   |   |
| Section  8.05                  |   | Regulations |   |   |
| Section  8.06                  |   | Voting |   |   |
| Section  8.07                  |   | Quorum;  Actions |   |   |
| ARTICLE IX                     |
| SUPPLEMENTAL INDENTURES        |
| Section  9.01                  |   | Supplemental  Indentures without Consent of Securityholders |   |   |
| Section  9.02                  |   | Supplemental  Indentures with Consent of Securityholders |   |   |
| Section  9.03                  |   | Effect of  Supplemental Indentures |   |   |
| Section  9.04                  |   | Notation on  Debt Securities |   |   |
| Section  9.05                  |   | Evidence of  Compliance of Supplemental Indenture to be Furnished to Trustee |   |   |
| ARTICLE X                      |
| REDEMPTION OF SECURITIES       |
| Section  10.01                 |   | Optional  Redemption |   |   |
| Section  10.02                 |   | Special  Event Redemption |   |   |
| Section  10.03                 |   | Notice of  Redemption; Selection of Debt Securities |   |   |
| Section  10.04                 |   | Payment  of Debt Securities Called for Redemption |   |   |

 

 

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| ARTICLE XI                                                       |
|------------------------------------------------------------------|
| CONSOLIDATION, MERGER, SALE, CONVEYANCE AND  LEASE               |
| Section  11.0l                                                   |   | Company  May Consolidate, etc., on Certain Terms |   |   |
| Section  11.02                                                   |   | Successor  Entity to be Substituted |   |   |
| Section  11.03                                                   |   | Opinion  of Counsel to be Given to Trustee |   |   |
| ARTICLE XII                                                      |
| SATISFACTION AND DISCHARGE OF INDENTURE                          |
| Section  12.01                                                   |   | Discharge  of Indenture |   |   |
| Section  12.02                                                   |   | Deposited  Moneys to be Held in Trust by Trustee |   |   |
| Section  12.03                                                   |   | Paying  Agent to Repay Moneys Held |   |   |
| Section  12.04                                                   |   | Return of  Unclaimed Moneys |   |   |
| ARTICLE XIII                                                     |
| IMMUNITY OF INCORPORATORS, STOCKHOLDERS,  OFFICERS AND DIRECTORS |
| Section  13.01                                                   |   | Indenture  and Debt Securities Solely Corporate Obligations |   |   |
| ARTICLE XIV                                                      |
| MISCELLANEOUS PROVISIONS                                         |
| Section  14.01                                                   |   | Successors |   |   |
| Section  14.02                                                   |   | Official  Acts by Successor Entity |   |   |
| Section  14.03                                                   |   | Surrender  of Company Powers |   |   |
| Section  14.04                                                   |   | Addresses  for Notices, etc. |   |   |
| Section  14.05                                                   |   | Governing  Law |   |   |
| Section  14.06                                                   |   | Evidence  of Compliance with Conditions Precedent |   |   |
| Section  14.07                                                   |   | Non-Business  Days |   |   |
| Section  14.08                                                   |   | Table of  Contents, Headings, etc. |   |   |
| Section  14.09                                                   |   | Execution  in Counterparts |   |   |
| Section  14.10                                                   |   | Separability |   |   |
| Section  14.11                                                   |   | Assignment |   |   |
| Section  14.12                                                   |   | Acknowledgment  of Rights |   |   |

 

 

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| ARTICLE XV                       |
|----------------------------------|
| SUBORDINATION OF DEBT SECURITIES |
| Section  15.01                   |   | Agreement  to Subordinate |   |   |
| Section  15.02                   |   | Default on  Senior Indebtedness |   |   |
| Section  15.03                   |   | Liquidation;  Dissolution; Bankruptcy |   |   |
| Section  15.04                   |   | Subrogation |   |   |
| Section  15.05                   |   | Trustee  to Effectuate Subordination |   |   |
| Section  15.06                   |   | Notice by  the Company |   |   |
| Section  15.07                   |   | Rights of  the Trustee; Holders of Senior Indebtedness |   |   |
| Section  15.08                   |   | Subordination  May Not Be Impaired |   |   |
| EXHIBITS                         |   |   |   |   |
| EXHIBIT A                        | FORM OF DEBT  SECURITY |   |   |

 

 

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THIS INDENTURE, dated as ofNovember 28, 2001, between HF FINANCIAL CORP., a savings and loan holdingcompany incorporated in Delaware (hereinafter sometimes called the “Company”),and Wilmington Trust Company, a Delaware banking corporation, as trustee(hereinafter sometimes called the “Trustee”),

WI T N E S S E T H :

WHEREAS, for its lawfulcorporate purposes, the Company has duly authorized the issuance of itsFloating Rate Junior Subordinated Debt Securities due 2031 (the “DebtSecurities”) under this Indenture and to provide, among other things, for theexecution and authentication, delivery and administration thereof, the Companyhas duly authorized the execution of this Indenture,

NOW,THEREFORE, This Indenture Witnesseth:

In consideration of thepremises, and the purchase of the Debt Securities by the holders thereof, theCompany covenants and agrees with the Trustee for the equal and proportionatebenefit of the respective holders from time to time of the Debt Securities asfollows:

ARTICLE I

DEFINITIONS

SECTION 1.01  Definitions.

The terms defined in this Section 1.01 (except asherein otherwise expressly provided or unless the context otherwise requires)for all purposes of this Indenture and of any indenture supplemental heretoshall have the respective meanings specified in this Section 1.0l. Allaccounting terms used herein and not expressly defined shall have the meaningsassigned to such terms in accordance with generally accepted accountingprinciples and the term “generally accepted accounting principles” means suchaccounting principles as are generally accepted at the time of any computation.The words “herein,” “hereof” and “hereunder” and other words of similar importrefer to this Indenture as a whole and not to any particular Article, Sectionor other subdivision.

“Additional Interest” shall have the meaning set forth in Section 3.06.

“Additional Provisions” shall have the meaning set forth in Section15.01.

“Authenticating Agent” means any agent or agents ofthe Trustee which at the time shall be appointed and acting pursuant to Section6.12.

“Bankruptcy Law” means Title 11, U.S. Code, or anysimilar federal or state law for the relief of debtors.

“Board of Directors” meansthe board of directors or the executive committee or any other duly authorizeddesignated officers of the Company.

 

 

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“Board Resolution” means a copy of a resolutioncertified by the Secretary or an Assistant Secretary of the Company to havebeen duly adopted by the Board of Directors and to be in full force and effecton the date of such certification and delivered to the Trustee.

“Business Day” means any day other than a Saturday,Sunday or any other day on which banking institutions in Wilmington, Delaware,New York City or Sioux Falls, South Dakota are permitted or required by anyapplicable law or executive order to close.

“Calculation Agent” means the Person identified as“Trustee” in the first paragraph hereof with respect to the Debt Securities andthe Institutional Trustee with respect to the Trust Securities.

“Capital Securities” means undivided beneficialinterests in the assets of the Trust which are designated as “MMCapSSM” and rank *paripassu*with Common Securities issued by the Trust; *provided*, *however*,that if an Event of Default (as defined in the Declaration) has occurred and iscontinuing, the rights of holders of such Common Securities to payment inrespect of distributions and payments upon liquidation, redemption andotherwise are subordinated to the rights of holders of such Capital Securities.

“Capital Securities Guarantee” means the guaranteeagreement that the Company will enter into with Wilmington Trust Company orother Persons that operates directly or indirectly for the benefit of holdersof Capital Securities of the Trust.

“Capital Treatment Event”means the receipt by the Company and the Trust of an opinion of counselexperienced in such matters to the effect that, as a result of (a) anyamendment to, or change in, the laws, rules or regulations of the United Statesor any political subdivision thereof or therein, or any rules, guidelines orpolicies of an applicable regulatory authority for the Company or (b) anyofficial or administrative pronouncement or action or decision interpreting orapplying such laws, rules or regulations, which amendment or change iseffective or which pronouncement, action or decision is announced on or afterthe date of original issuance of the Debt Securities, there is more than aninsubstantial risk that the Company will not, within 90 days of the date ofsuch opinion, be entitled to treat an amount equal to the aggregate LiquidationAmount of the Capital Securities as “Tier 1 Capital” (or its then equivalent ifthe Company were subject to such capital requirement) applied as if the Company(or its successors) were a bank holding company for purposes of the capitaladequacy guidelines of the Federal Reserve (or any successor regulatoryauthority with jurisdiction over bank holding companies), or any capitaladequacy guidelines as then in effect and applicable to the Company, *provided*, *however*,that the distribution of the Debt Securities in connection with the liquidationof the Trust by the Company shall not in and of itself constitute a CapitalTreatment Event unless such liquidation shall have occurred in connection witha Tax Event or an Investment Company Event.

“Certificate” means a certificate signed by any oneof the principal executive officer, the principalfinancial officer or the principal accounting officer of the Company.

“Common Securities” meansundivided beneficial interests in the assets of the Trust which are designatedas “Common Securities” and *rank pari passu*withCapital Securities issued by the Trust; *provided*,*however*, that if an Event ofDefault (as defined in the Declaration) has occurred and is continuing, therights of holders of such Common Securities to payment in respect ofdistributions and payments upon liquidation, redemption and otherwise aresubordinated to the rights of holders of such Capital Securities.

 

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“Company” means HF Financial Corp., a savings andloan holding company incorporated in Delaware, and, subject to the provisionsof Article XI, shall include its successors and assigns.

“Comparable Treasury Issue” means with respect toany Special Redemption Date, the United States Treasury security selected bythe Quotation Agent as having a maturity comparable to the Remaining Life thatwould be utilized, at the time of selection and in accordance with customaryfinancial practice, in pricing new issues of corporate debt securities ofcomparable maturity to the Remaining Life. If no United States Treasurysecurity has a maturity which is within a period from three months before tothree months after December 8, 2006, the two most closely corresponding UnitedStates Treasury securities shall be used as the Comparable Treasury Issue, andthe Treasury Rate shall be interpolated or extrapolated on a straight-linebasis, rounding to the nearest month using such securities.

“Comparable Treasury Price” means (a) the average offive Reference Treasury Dealer Quotations for such Special Redemption Date,after excluding the highest and lowest such Reference Treasury DealerQuotations, or (b) if the Trustee receives fewer than five such ReferenceTreasury Dealer Quotations, the average of all such Quotations.

“Debt Security” or “DebtSecurities” has the meaning stated in the first recital of this Indenture.

“Debt Security Register” has the meaning specified in Section 2.05.

“Declaration” means the Amended and RestatedDeclaration of Trust of the Trust, as amended or supplemented from time totime.

“Default” means any event,act or condition that with notice or lapse of time, or both, would constitutean Event of Default.

“Defaulted Interest” has the meaning set forth in Section 2.08.

“Deferred Interest” has the meaning set forth in Section 2.11.

“Event of Default” means any event specified inSection 5.01, which has continued for the period of time, if any, and after thegiving of the notice, if any, therein designated.

“Extension Period” has the meaning set forth in Section 2.11.

“Federal Reserve” means theBoard of Governors of the Federal Reserve System.

 

 

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“Indenture” means this instrument as originallyexecuted or, if amended or supplemented as herein provided, as so amended orsupplemented, or both.

“Institutional Trustee” has the meaning set forth in the Declaration.

“Interest Payment Date” means June 8th and December8th of each year, commencing on June 8, 2002, during the term of thisIndenture.

“Interest Rate” means a perannum rate of interest, reset semi-annually, equal to LIBOR, as determined onthe LIBOR Determination Date immediately preceding each Interest Payment Date,plus 3.75%; *provided*, that theapplicable Interest Rate may not exceed 11.0% through the Interest Payment Datein December, 2006.

“Investment Company Event”means the receipt by the Company and the Trust of an opinion of counselexperienced in such matters to the effect that, as a result of a change in lawor regulation or written change in interpretation or application of law orregulation by any legislative body, court, governmental agency or regulatoryauthority, there is more than an insubstantial risk that the Trust is or,within 90 days of the date of such opinion will be, considered an “investmentcompany” that is required to be registered under the Investment Company Act of1940, as amended, which change or prospective change becomes effective or wouldbecome effective, as the case may be, on or after the date of the original issuanceof the Debt Securities.

“LIBOR” means the LondonInterbank Offered Rate for six-month Eurodollar deposits in Europe asdetermined by the Calculation Agent according to Section 2.10(b).

“LIBOR Banking Day” has themeaning set forth in Section 2.10(b)(1). 

“LIBOR Business Day” has themeaning set forth in Section 2.10(b)(1). 

“LIBOR Determination Date”has the meaning set forth in Section 2.10(b). 

“Liquidation Amount” meansthe stated amount of $1,000 per Trust Security. 

“Maturity Date” meansDecember 8,2031.

“Officers’ Certificate”means a certificate signed by the Chairman of the Board, the Vice Chairman, thePresident or any Vice President, and by the Chief Financial Officer, theTreasurer, an Assistant Treasurer, the Comptroller, an Assistant Comptroller,Secretary or an Assistant Secretary of the Company, and delivered to theTrustee. Each such certificate shall include the statements provided for inSection 14.06 if and to the extent required by the provisions of such Section.

“Opinion of Counsel” meansan opinion in writing signed by legal counsel, who may be an employee of orcounsel to the Company, or may be other counsel reasonably satisfactory to theTrustee. Each such opinion shall include the statements provided for in Section14.06 if and to the extent required by the provisions of such Section.

 

 

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“OTS” means the Office of Thrift Supervision.

The term “outstanding,” when used with reference toDebt Securities, subject to the provisions of Section 7.04, means, as of anyparticular time, all Debt Securities authenticated and delivered by the Trusteeor the Authenticating Agent under this Indenture, except

(a)           Debt Securities theretoforecanceled by the Trustee or the Authenticating Agent or delivered to the Trusteefor cancellation;

(b)           Debt Securities, or portionsthereof, for the payment or redemption of which moneys in the necessary amountshall have been deposited in trust with the Trustee or with any paying agent(other than the Company) or shall have been set aside and segregated in trustby the Company (if the Company shall act as its own paying agent); *provided*, that, if such Debt Securities,or portions thereof, are to be redeemed prior to maturity thereof, notice ofsuch redemption shall have been given as provided in Articles Ten and Fourteenor provision satisfactory to the Trustee shall have been made for giving suchnotice; and

(c)           Debt Securities paidpursuant to Section 2.06 or in lieu of or in substitution for which other DebtSecurities shall have been authenticated and delivered pursuant to the terms ofSection 2.06 unless proof satisfactory to the Company and the Trustee ispresented that any such Debt Securities are held by bona fide holders in duecourse.

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

“Predecessor Security” of any particular Debt Securitymeans every previous Debt Security evidencing all or a portion of the same debtas that evidenced by such particular Debt Security; and, for the purposes ofthis definition, any Debt Security authenticated and delivered under Section2.06 in lieu of a lost, destroyed or stolen Debt Security shall be deemed toevidence the same debt as the lost, destroyed or stolen Debt Security.

“Primary Treasury Dealer” means a primary UnitedStates Government securities dealer in New York City.

“Principal Office of the Trustee,” or other similarterm, means the office of the Trustee, at which at any particular time itscorporate trust business shall be principally administered, which at all timesshall be located within the United States and at the time of the execution ofthis Indenture shall be Rodney Square North, 1100 North Market Street,Wilmington, Delaware 19890-0001.

“Quotation Agent” means Salomon Smith Barney Inc.and its successors; *provided*, *however*, that if the foregoing shall ceaseto be a Primary Treasury Dealer, the Company shall substitute therefor anotherPrimary Treasury Dealer.

“Redemption Date” has themeaning set forth in Section 10.01.

 

 

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“Redemption Price” means100% of the principal amount of the Debt Securities being redeemed plus accruedand unpaid interest on such Debt Securities to the Redemption Date or, in thecase of a redemption due to the occurrence of a Special Event, to the SpecialRedemption Date if such Special Redemption Date is on or after December 8,2006.

“Reference Treasury Dealer”means (i) the Quotation Agent and (ii) any other Primary Treasury Dealerselected by the Trustee after consultation with the Company.

“Reference Treasury DealerQuotations” means, with respect to each Reference Treasury Dealer and anySpecial Redemption Date, the average, as determined by the Quotation Agent, ofthe bid and asked prices for the Comparable Treasury Issue (expressed in eachcase as a percentage of its principal amount) quoted in writing to the Trusteeby such Reference Treasury Dealer at 5:00 p.m., New York City time, on thethird Business Day preceding such Special Redemption Date.

“Remaining Life” means, with respect to any DebtSecurity, the period from the Special Redemption Date for such Debt Security toDecember 8, 2006.

“Responsible Officer” means,with respect to the Trustee, any officer within the Principal Office of theTrustee with direct responsibility for the administration of the Indenture,including any vice-president, any assistant vice-president, any secretary, anyassistant secretary, the treasurer, any assistant treasurer, any trust officeror other officer of the Principal Trust Office of the Trustee customarilyperforming functions similar to those performed by any of the above designatedofficers and also means, with respect to a particular corporate trust matter,any other officer to whom such matter is referred because of that officer’sknowledge of and familiarity with the particular subject.

“Securityholder, “ “holderof Debt Securities” or other similar terms, means any Person in whose name atthe time a particular Debt Security is registered on the Debt SecurityRegister.

“Senior Indebtedness” means,with respect to the Company, (i) the principal, premium, if any, and interestin respect of (A) indebtedness of the Company for money borrowed and (B)indebtedness evidenced by securities, debentures, notes, bonds or other similarinstruments issued by the Company; (ii) all capital lease obligations of theCompany; (iii) all obligations of the Company issued or assumed as the deferredpurchase price of property, all conditional sale obligations of the Company andall obligations of the Company under any title retention agreement (butexcluding trade accounts payable arising in the ordinary course of business);(iv) all obligations of the Company for the reimbursement of any letter ofcredit, any banker’s acceptance, any security purchase facility, any repurchaseagreement or similar arrangement, any interest rate swap, any other hedgingarrangement, any obligation under options or any similar credit or othertransaction; (v) all obligations of the type referred to in clauses (i) through(iv) above of other Persons for the payment of which the Company is responsibleor liable as obligor, guarantor or otherwise; and (vi) all obligations of thetype referred to in clauses (i) through (v) above of other Persons secured byany lien on any property or asset of the Company (whether or not suchobligation is assumed by the Company), whether incurred on or prior to the dateof this Indenture or thereafter incurred, unless, with the prior approval ofthe OTS if not otherwise generally approved, in the instrument creating orevidencing the same or pursuant to which the same is outstanding, it isprovided that such obligations are not superior or are pair passu in right ofpayment to the Debt Securities.

 

 

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“Special Event” means any of a Tax Event, anInvestment Company Event or a Capital Treatment Event.

“Special Redemption Date” has the meaning set forth in 10.02.

“Special Redemption Price” means (1) if the SpecialRedemption Date is before December 8, 2006, the greater of (a) 100% of theprincipal amount of the Debt Securities being redeemed pursuant to Section10.02 or (b) as determined by a Quotation Agent, the sum of the present valuesof the principal amount payable as part of the Redemption Price with respect toa redemption as of December 8, 2006, together with the present value ofinterest payments calculated at a fixed per annum rate of interest equal to9.95% over the Remaining Life of such Debt Securities, discounted to theSpecial Redemption Date on a semi-annual basis (assuming a 360-day yearconsisting of twelve 30-day months) at the Treasury Rate plus 0.50%, plus, inthe case of either (a) or (b), accrued and unpaid interest on such DebtSecurities to the Special Redemption Date and (2) if the Special RedemptionDate is on or after December 8, 2006, the Redemption Price for such SpecialRedemption Date.

“Subsidiary” means, with respect to any Person, (i)any corporation at least a majority of the outstanding voting stock of which isowned, directly or indirectly, by such Person or by one or more of itsSubsidiaries, or by such Person and one or more of its Subsidiaries, (ii) anygeneral partnership, joint venture or similar entity, at least a majority ofthe outstanding partnership or similar interests of which shall at the time beowned by such Person, or by one or more of its Subsidiaries, or by such Personand one or more of its Subsidiaries, and (iii) any limited partnership of whichsuch Person or any of its Subsidiaries is a general partner. For the purposesof this definition, “voting stock” means shares, interests, participations orother equivalents in the equity interest (however designated) in such Personhaving ordinary voting power for the election of a majority of the directors(or the equivalent) of such Person, other than shares, interests,participations or other equivalents having such power only by reason of theoccurrence of a contingency.

“Tax Event” means thereceipt by the Company and the Trust of an opinion of counsel experienced insuch matters to the effect that, as a result of any amendment to or change(including any announced prospective change) in the laws or any regulationsthereunder of the United States or any political subdivision or taxingauthority thereof or therein, or as a result of any official administrativepronouncement (including any private letter ruling, technical advicememorandum, regulatory procedure, notice or announcement (an “AdministrativeAction”)) or judicial decision interpreting or applying such laws orregulations, regardless of whether such Administrative Action or judicialdecision is issued to or in connection with a proceeding involving the Companyor the Trust and whether or not subject to review or appeal, which amendment,clarification, change, Administrative Action or decision is enacted,promulgated or announced, in each case on or after the date of originalissuance of the Debt Securities, there is more than an insubstantial risk that:(i) the Trust is, or will be within 90 days of the date of such opinion,subject to United States federal income tax with respect to income received oraccrued on the Debt Securities; (ii) interest payable by the Company on theDebt Securities is not, or within 90 days of the date of such opinion, will notbe, deductible by the Company, in whole or in part, for United States federal incometax purposes; or (iii) the Trust is, or will be within 90 days of the date ofsuch opinion, subject to more than a de minimis amount of other taxes, duties,assessments or other governmental charges.

 

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“Treasury Rate” means (i)the yield, under the heading which represents the average for the weekimmediately prior to the date of calculation, appearing in the most recentlypublished statistical release designated H.15 (519) or any successorpublication which is published weekly by the Federal Reserve and whichestablishes yields on actively traded United States Treasury securitiesadjusted to constant maturity under the caption “Treasury Constant Maturities,”for the maturity corresponding to the Remaining Life (if no maturity is withinthree months before or after the Remaining Life, yields for the two publishedmaturities most closely corresponding to the Remaining Life shall be determinedand the Treasury Rate shall be interpolated or extrapolated from such yields ona straight-line basis, rounding to the nearest month) or (ii) if such release(or any successor release) is not published during the week preceding thecalculation date or does not contain such yields, the rate per annum equal tothe semi-annual equivalent yield to maturity of the Comparable Treasury Issue,calculated using a price for the Comparable Treasury Issue (expressed as apercentage of its principal amount) equal to the Comparable Treasury Price forsuch Special Redemption Date. The Treasury Rate shall be calculated on thethird Business Day preceding the Special Redemption Date.

“Trust” means HF FinancialCapital Trust I, the Delaware business trust, or any other similar trustcreated for the purpose of issuing Capital Securities in connection with theissuance of Debt Securities under this Indenture, of which the Company is thesponsor.

“TrustIndenture Act” means the Trust Indenture Act of 1939, as amended.

“Trust Securities” meansCommon Securities and Capital Securities of HF Financial Capital Trust I.

“Trustee” means the Personidentified as “Trustee” in the first paragraph hereof, and, subject to theprovisions of Article VI hereof, shall also include its successors and assignsas Trustee hereunder.

“UnitedStates” means the United States of America and the District of Columbia.

“U.S. Person” has the meaning given to United StatesPerson as set forth in Section 770l(a)(30) of the Internal Revenue Code of1986, as amended.

ARTICLE II

DEBTSECURITIES

SECTION 2.01  Authentication and Dating.

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Upon the execution anddelivery of this Indenture, or from time to time thereafter, Debt Securities inan aggregate principal amount not in excess of $10,310,000 may be executed anddelivered by the Company to the Trustee for authentication, and the Trusteeshall thereupon authenticate and make available for delivery said DebtSecurities to or upon the written order of the Company, signed by its Chairmanof the Board of Directors, Vice Chairman, President or Chief Financial Officeror one of its Vice Presidents without any further action by the Companyhereunder. In authenticating such Debt Securities, and accepting the additionalresponsibilities under this Indenture in relation to such Debt Securities, theTrustee shall be entitled to receive, and (subject to Section 6.01) shall befully protected in relying upon a copy of any Board Resolution or BoardResolutions relating thereto and, if applicable, an appropriate record of anyaction taken pursuant to such resolution, in each case certified by theSecretary or an Assistant Secretary of the Company as the case may be.

 

The Trustee shall have theright to decline to authenticate and deliver any Debt Securities under thisSection if the Trustee, being advised by counsel, determines that such actionmay not lawfully be taken or if a Responsible Officer of the Trustee in goodfaith shall determine that such action would expose the Trustee to personalliability to existing holders.

The definitive Debt Securitiesshall be typed, printed, lithographed or engraved on steel engraved borders ormay be produced in any other manner, all as determined by the officersexecuting such Debt Securities, as evidenced by their execution of such DebtSecurities.

SECTION 2.02  Form of Trustee’s Certificate ofAuthentication.

The Trustee’s certificate of authentication on allDebt Securities shall be in substantially the following form:

This is one of the Debt Securities referred to in the within-mentionedIndenture.

Wilmington Trust Company, not in its individual capacity but solely astrustee
| By                 |   |
|--------------------|--------|
| Authorized Officer |

 

SECTION 2.03  Form and Denomination of Debt Securities.

The Debt Securities shall be substantially in theform of Exhibit A hereto. The Debt Securities shall be in registered,certificated form without coupons and in minimum denominations of $100,000 andany multiple of $1,000 in excess thereof. The Debt Securities shall benumbered, lettered, or otherwise distinguished in such manner or in accordancewith such plans as the officers executing the same may determine with theapproval of the Trustee as evidenced by the execution and authenticationthereof.

SECTION 2.04  Execution of Debt Securities.

The Debt Securities shall besigned in the name and on behalf of the Company by the manual or facsimilesignature of its Chairman of the Board of Directors, Vice Chairman, Presidentor Chief Financial Officer or one of its Executive Vice Presidents, Senior VicePresidents or Vice Presidents under its corporate seal which may be affixedthereto or printed, engraved or otherwise reproduced thereon, by facsimile orotherwise, and which need not be attested. Only such Debt Securities as shallbear thereon a certificate of authentication substantially in the form herein beforerecited, executed by the Trustee or the Authenticating Agent by the manualsignature of an authorized officer, shall be entitled to the benefits of thisIndenture or be valid or obligatory for any purpose. Such certificate by theTrustee or the Authenticating Agent upon any Debt Security executed by theCompany shall be conclusive evidence that the Debt Security so authenticatedhas been duly authenticated and delivered hereunder and that the holder isentitled to the benefits of this Indenture.

 

 

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In case any officer of the Company who shall havesigned any of the Debt Securities shall cease to be such officer before theDebt Securities so signed shall have been authenticated and delivered by the Trustee orthe Authenticating Agent, or disposed of by the Company, such Debt Securitiesnevertheless may be authenticated and delivered or disposed of as though thePerson who signed such Debt Securities had not ceased to be such officer of theCompany; and any Debt Security may be signed on behalf of the Company by suchPersons as, at the actual date of the execution of such Debt Security, shall bethe proper officers of the Company, although at the date of the execution ofthis Indenture any such person was not such an officer.

Every Debt Security shall be dated the date of its authentication.

SECTION 2.05  Exchange and Registration of Transfer ofDebt Securities.

The Company shall cause tobe kept, at the office or agency maintained for the purpose of registration oftransfer and for exchange as provided in Section 3.02, a register (the “DebtSecurity Register”) for the Debt Securities issued hereunder in which, subjectto such reasonable regulations as it may prescribe, the Company shall providefor the registration and transfer of all Debt Securities as in this Article Twoprovided. Such register shall be in written form or in any other form capableof being converted into written form within a reasonable time.

Debt Securities to beexchanged may be surrendered at the Principal Office of the Trustee or at anyoffice or agency to be maintained by the Company for such purpose as providedin Section 3.02, and the Company shall execute, the Company or the Trusteeshall register and the Trustee or the Authenticating Agent shall authenticateand make available for delivery in exchange therefor the Debt Security or DebtSecurities which the Securityholder making the exchange shall be entitled toreceive. Upon due presentment for registration of transfer of any Debt Securityat the Principal Office of the Trustee or at any office or agency of theCompany maintained for such purpose as provided in Section 3.02, the Companyshall execute, the Company or the Trustee shall register and the Trustee or theAuthenticating Agent shall authenticate and make available for delivery in thename of the transferee or transferees a new Debt Security for a like aggregateprincipal amount. Registration or registration of transfer of any DebtSecurity by the Trustee or by any agent of the Company appointed pursuant toSection 3.02, and delivery of such Debt Security, shall be deemed to completethe registration or registration of transfer of such Debt Security.

 

 

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All Debt Securities presentedfor registration of transfer or for exchange or payment shall (if so requiredby the Company or the Trustee or the Authenticating Agent) be duly endorsed by,or be accompanied by a written instrument or instruments of transfer in formsatisfactory to the Company and either the Trustee or the Authenticating Agentduly executed by, the holder or his attorney duly authorized in writing.

No service charge shall bemade for any exchange or registration of transfer of Debt Securities, but theCompany or the Trustee may require payment of a sum sufficient to cover anytax, fee or other governmental charge that may be imposed in connectiontherewith.

The Company or the Trusteeshall not be required to exchange or register a transfer of any Debt Securityfor a period of 15 days next preceding the date of selection of Debt Securitiesfor redemption.

Notwithstanding theforegoing, Debt Securities may not be transferred except in compliance with therestricted securities legend set forth below, unless otherwise determined bythe Company in accordance with applicable law, which legend shall be placed oneach Debt Security:

THIS SECURITY HAS NOT BEENREGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAWS. NEITHERTHIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THEABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOTSUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OFTHIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISETRANSFER SUCH SECURITY ONLY (A) TO THE COMPANY, (B) PURSUANT TO RULE 144A UNDERTHE SECURITIES ACT (“RULE 144A”), TO A PERSON THE HOLDER REASONABLY BELIEVES ISA “QUALIFIED INSTITUTIONAL BUYER’ AS DEFINED IN RULE 144A THAT PURCHASES FORITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOMNOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C)PURSUANT TO AN EXEMPTION FROM REGISTRATION TO AN “ACCREDITED INVESTOR’ WITHINTHE MEANING OF SUBPARAGRAPH (a) (l), (2), (3) OR (7) OF RULE 501 UNDER THESECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THEACCOUNT OF AN “ACCREDITED INVESTOR,” FOR INVESTMENT PURPOSES AND NOT WITH AVIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATIONOF THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THEREGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S RIGHTPRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) TOREQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHERINFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH THE INDENTURE, A COPY OFWHICH MAY BE OBTAINED FROM THE COMPANY. THE HOLDER OF THIS SECURITY AGREES THATIT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.

 

 

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THE HOLDER OF THIS SECURITYBY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT ANEMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENTSUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, ASAMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, ASAMENDED (THE “CODE”), (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING ASSETSINCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY AND NOPERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THIS SECURITY ORANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THEEXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITEDTRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-l OR 84-14 OR ANOTHERAPPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOTPROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TOSUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANYINTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDINGTHEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANINGOF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE ISAPPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFITPLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEEBENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOTRESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVEEXEMPTION.

IN CONNECTION WITH ANYTRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCHCERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY THE INDENTURE TOCONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

THIS SECURITY WILL BE ISSUEDAND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A PRINCIPAL AMOUNT OF NOT LESSTHAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFEROF THIS SECURITY IN A BLOCK HAVING A PRINCIPAL AMOUNT OF LESS THAN $100,000SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCHPURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SECURITY FORANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ONTHIS SECURITY, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NOINTEREST WHATSOEVER IN THIS SECURITY.

 

 

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SECTION 2.06  Mutilated, Destroyed, Lost or Stolen DebtSecurities.

In case any Debt Securityshall become mutilated or be destroyed, lost or stolen, the Company shallexecute, and upon its written request the Trustee shall authenticate anddeliver, a new Debt Security bearing a number not contemporaneouslyoutstanding, in exchange and substitution for the mutilated Debt Security, orin lieu of and in substitution for the Debt Security so destroyed, lost orstolen. In every case the applicant for a substituted Debt Security shallfurnish to the Company and the Trustee such security or indemnity as may berequired by them to save each of them harmless, and, in every case ofdestruction, loss or theft, the applicant shall also furnish to the Company andthe Trustee evidence to their satisfaction of the destruction, loss or theft ofsuch Debt Security and of the ownership thereof.

The Trustee may authenticateany such substituted Debt Security and deliver the same upon the writtenrequest or authorization of any officer of the Company. Upon the issuance of anysubstituted Debt Security, the Company may require the payment of a sumsufficient to cover any tax or other governmental charge that may be imposed inrelation thereto and any other expenses connected therewith. In case any DebtSecurity which has matured or is about to mature or has been called forredemption in full shall become mutilated or be destroyed, lost or stolen, theCompany may, instead of issuing a substitute Debt Security, pay or authorizethe payment of the same (without surrender thereof except in the case of amutilated Debt Security) if the applicant for such payment shall furnish to theCompany and the Trustee such security or indemnity as may be required by themto save each of them harmless and, in case of destruction, loss or theft, evidencesatisfactory to the Company and to the Trustee of the destruction, loss ortheft of such Security and of the ownership thereof.

Every substituted DebtSecurity issued pursuant to the provisions of this Section 2.06 by virtue ofthe fact that any such Debt Security is destroyed, lost or stolen shallconstitute an additional contractual obligation of the Company, whether or notthe destroyed, lost or stolen Debt Security shall be found at any time, andshall be entitled to all the benefits of this Indenture equally andproportionately with any and all other Debt Securities duly issued hereunder.All Debt Securities shall be held and owned upon the express condition that, tothe extent permitted by applicable law, the foregoing provisions are exclusivewith respect to the replacement or payment of mutilated, destroyed, lost orstolen Debt Securities and shall preclude any and all other rights or remediesnotwithstanding any law or statute existing or hereafter enacted to thecontrary with respect to the replacement or payment of negotiable instrumentsor other securities without their surrender.

SECTION 2.07  Temporary Debt Securities.

Pending the preparation ofdefinitive Debt Securities, the Company may execute and the Trustee shallauthenticate and make available for delivery temporary Debt Securities that aretyped, printed or lithographed. Temporary Debt Securities shall be issuable inany authorized denomination, and substantially in the form of the definitiveDebt Securities but with such omissions, insertions and variations as may beappropriate for temporary Debt Securities, all as may be determined by theCompany. Every such temporary Debt Security shall be executed by the Companyand be authenticated by the Trustee upon the same conditions and insubstantially the same manner, and with the same effect, as the definitive DebtSecurities. Without unreasonable delay the Company will execute and deliver tothe Trustee or the Authenticating Agent definitive Debt Securities andthereupon any or all temporary Debt Securities may be surrendered inexchange therefor, at the principal corporate trust office of the Trustee or atany office or agency maintained by the Company for such purpose as provided inSection 3.02, and the Trustee or the Authenticating Agent shall authenticateand make available for delivery in exchange for such temporary Debt Securities a like aggregateprincipal amount of such definitive Debt Securities. Suchexchange shall be made by the Company at its own expense and without any chargetherefor except that in case of any such exchange involving a registration oftransfer the Company may require payment of a sum sufficient to cover any tax,fee or other governmental charge that may be imposed in relation thereto. Untilso exchanged, the temporary Debt Securities shall in all respects be entitledto the same benefits under this Indenture as definitive Debt Securitiesauthenticated and delivered hereunder.

 

 

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SECTION 2.08  Payment of Interest.

Each Debt Security will bearinterest at the then applicable Interest Rate from and including each InterestPayment Date or, in the case of the first interest period, the original date ofissuance of such Debt Security to, but excluding, the next succeeding InterestPayment Date or, in the case of the last interest period, the Redemption Date,Special Redemption Date or Maturity Date, as applicable, on the principalthereof, on any overdue principal and (to the extent that payment of suchinterest is enforceable under applicable law) on Deferred Interest and on anyoverdue installment of interest (including Defaulted Interest), payable(subject to the provisions of Article XII) on each Interest Payment Datecommencing on June 8, 2002. Interest and any Deferred Interest on any DebtSecurity that is payable, and is punctually paid or duly provided for, on anyInterest Payment Date shall be paid to the Person in whose name said DebtSecurity (or one or more Predecessor Securities) is registered at the close ofbusiness on the regular record date for such interest installment, except thatinterest and any Deferred Interest payable on the Maturity Date shall be paidto the Person to whom principal is paid. In the event that any Debt Security orportion thereof is called for redemption and the redemption date is subsequentto a regular record date with respect to any Interest Payment Date and prior tosuch Interest Payment Date, interest on such Debt Security will be paid uponpresentation and surrender of such Debt Security.

Any interest on any DebtSecurity, other than Deferred Interest, that is payable, but is not punctuallypaid or duly provided for, on any Interest Payment Date (herein called“Defaulted Interest”) shall forthwith cease to be payable to the registeredholder on the relevant regular record date by virtue of having been suchholder, and such Defaulted Interest shall be paid by the Company to the Personsin whose names such Debt Securities (or their respective PredecessorSecurities) are registered at the close of business on a special record datefor the payment of such Defaulted Interest, which shall be fixed in thefollowing manner: the Company shall notify the Trustee in writing of the amountof Defaulted Interest proposed to be paid on each such Debt Security and thedate of the proposed payment, and at the same time the Company shall depositwith the Trustee an amount of money equal to the aggregate amount proposed tobe paid in respect of such Defaulted Interest or shall make arrangements satisfactoryto the Trustee for such deposit prior to the date of the proposedpayment, such money when deposited to be held in trust for the benefitof the Persons entitled to such Defaulted Interest as in this clause provided.Thereupon the Trustee shall fix a special record date for the payment of suchDefaulted Interest which shall not be more than fifteen nor less than ten daysprior to the date of the proposed payment and not less than ten days after thereceipt by the Trustee of the notice of the proposed payment. The Trustee shallpromptly notify the Company of such special record date and, in the name and atthe expense of the Company, shall cause notice of the proposed payment of suchDefaulted Interest and the special record date therefor to be mailed, firstclass postage prepaid; to each Securityholder at his or her address as itappears in the Debt Security Register, not less than ten days prior to suchspecial record date. Notice of the proposed payment of such Defaulted Interestand the special record date therefor having been mailed as aforesaid, suchDefaulted Interest shall be paid to the Persons in whose names such DebtSecurities (or their respective Predecessor Securities) are registered on suchspecial record date and thereafter the Company shall have no further paymentobligation in respect of the Defaulted Interest.

 

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Any interest scheduled to become payable on anInterest Payment Date occurring during an Extension Period shall not be DefaultedInterest and shall be payable on such other date as may be specified in theterms of such Debt Securities.

The term “regular recorddate” as used in this Section shall mean the fifteenth day prior to an InterestPayment Date whether or not such date is a Business Day.

Subject to the foregoing provisions of this Section,each Debt Security delivered under this Indenture upon registration of transferof or in exchange for or in lieu of any other Debt Security shall carry therights to interest accrued and unpaid, and to accrue, that were carried by suchother Debt Security.

SECTION 2.09  Cancellation of Debt Securities Paid,etc.

All Debt Securitiessurrendered for the purpose of payment, redemption, exchange or registration oftransfer, shall, if surrendered to the Company or any paying agent, besurrendered to the Trustee and promptly canceled by it, or, if surrendered tothe Trustee or any Authenticating Agent, shall be promptly canceled by it, andno Debt Securities shall be issued in lieu thereof except as expresslypermitted by any of the provisions of this Indenture. All Debt Securitiescanceled by any Authenticating Agent shall be delivered to the Trustee. TheTrustee shall destroy all canceled Debt Securities unless the Company otherwisedirects the Trustee in writing. If the Company shall acquire any of the DebtSecurities, however, such acquisition shall not operate as a redemption orsatisfaction of the indebtedness represented by such Debt Securities unless anduntil the same are surrendered to the Trustee for cancellation.

SECTION 2.10  Computation of Interest.

(a)           The amount of interestpayable for any interest period will be computed on the basis of a 360-day yearand the actual number of days elapsed in the relevant interest period; provided,however, that upon the occurrence of a Special Event Redemption pursuantto Section 10.02 the amounts payable pursuant to this Indenture shall becalculated as set forth in the definition of Special Redemption Price.

 

 

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(b)           LIBOR shall bedetermined by the Calculation Agent in accordance with the followingprovisions:

(1)           On the second LIBOR BusinessDay (provided, that on such day commercial banks are open for business(including dealings in foreign currency deposits) in London (a “LIBOR BankingDay”), and otherwise the next preceding LIBOR Business Day that is also a LIBORBanking Day) prior to December 15th and June 15th (except, with respect to thefirst interest payment period, on November 26, 2001), (each such day, a “LIBORDetermination Date”), LIBOR shall equal the rate, as obtained by theCalculation Agent for six-month Eurodollar deposits in Europe which appears onTelerate Page 3750 (as defined in the International Swaps and Derivatives Association,Inc. 1991 Interest Rate and Currency Exchange Definitions) or such other pageas may replace such Page 3750, as of 1l:OO a.m. (London time) on such LIBORDetermination Date, as reported by Bloomberg Financial Markets CommoditiesNews. “LIBOR Business Day” means any day that is not a Saturday, Sunday orother day on which commercial banking institutions in New York, New York orWilmington, Delaware, are authorized or obligated by law or executive order tobe closed. If such rate is superseded on Telerate Page 3750 by a corrected ratebefore 12:00 noon (London time) on the same LIBOR Determination Date, thecorrected rate as so substituted will be the applicable LIBOR for that LIBORDetermination Date.

(2)           If, on any LIBORDetermination Date, such rate does not appear on Telerate Page 3750 or suchother page as may replace such Page 3750, the Calculation Agent shall determinethe arithmetic mean of the offered quotations of the Reference Banks (asdefined below) to leading banks in the London interbank market for six-monthU.S. Dollar deposits in Europe (in an amount determined by the CalculationAgent) by reference to requests for quotations as of approximately 1l:OO a.m.(New York time) on the LIBOR Determination Date made by the Calculation Agentto the Reference Banks. If, on any LIBOR Determination Date, at least two ofthe Reference Banks provide such quotations, LIBOR shall equal the arithmeticmean of such quotations. If, on any LIBOR Determination Date, only one or noneof the Reference Banks provide such quotations, LIBOR shall be deemed to be thearithmetic mean of the offered quotations that at least two leading banks inThe City of New York (as selected by the Calculation Agent) are quoting on therelevant LIBOR Determination Date for six-month U.S. Dollar deposits in Europeat approximately 1l:OO a.m. (New York time) (in an amount determined by theCalculation Agent). As used herein, “Reference Banks” means four major banks inthe London interbank market selected by the Calculation Agent.

(3)           If the Calculation Agent isrequired but is unable to determine a rate in accordance with at least one ofthe procedures provided above, LIBOR shall be LIBOR in effect on the previousLIBOR Determination Date (whether or not LIBOR for such period was in factdetermined on such LIBOR Determination Date).

(c)           All percentagesresulting from any calculations on the Debt Securities will be rounded, ifnecessary, to the nearest one hundred-thousandth of a percentage point, withfive one-millionths of a percentage point rounded upward (e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)),  and all dollar amounts used in or resulting from such calculationwill be rounded to the nearest cent (with one-half cent being rounded upward).

 

 

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(d)           On each LIBORDetermination Date, the Calculation Agent shall notify in writing the Companyand the Paying Agent of the applicable Interest Rate in effect for the relatedInterest Payment. The Calculation Agent shall, upon the request of the holderof any Debt Securities, provide the Interest Rate then in effect. Allcalculations made by the Calculation Agent in the absence of manifest errorshall be conclusive for all purposes and binding on the Company and the Holdersof the Debt Securities. The Paying Agent shall be entitled to rely oninformation received from the Calculation Agent or the Company as to theInterest Rate. The Company shall, from time to time, provide any necessaryinformation to the Paying Agent relating to any original issue discount andinterest on the Debt Securities that is included in any payment and reportablefor taxable income calculation purposes.

SECTION 2.11  Extension of Interest Payment Period.

So long as no Event ofDefault has occurred and is continuing, the Company shall have the right, fromtime to time and without causing an Event of Default, to defer payments ofinterest on the Debt Securities by extending the interest payment period on theDebt Securities at any time and from time to time during the term of the DebtSecurities, for up to ten consecutive semi-annual periods (each such extendedinterest payment period, an “Extension Period”), during which Extension Periodno interest shall be due and payable (except any Additional Interest that maybe due and payable). No Extension Period may end on a date other than anInterest Payment Date. During any Extension Period, interest will continue toaccrue on the Debt Securities, and interest on such accrued interest (suchaccrued interest and interest thereon referred to herein as “DeferredInterest”) will accrue at the Interest Rate, compounded semiannually from thedate such Deferred Interest would have been payable were it not for theExtension Period, both to the extent permitted by law. No interest or DeferredInterest shall be due and payable during an Extension Period, except at the endthereof. At the end of any such Extension Period the Company shall pay allDeferred Interest then accrued and unpaid on the Debt Securities; provided,however, that no Extension Period may extend beyond the Maturity Date;and provided further, however, that during any such Extension Period, theCompany shall be subject to the restrictions set forth in Section 3.08 of thisIndenture. Prior to the termination of any Extension Period, the Company mayfurther extend such period, provided, that such period together with all suchprevious and further consecutive extensions thereof shall not exceed tenconsecutive semi-annual periods, or extend beyond the Maturity Date. Upon thetermination of any Extension Period and upon the payment of all DeferredInterest, the Company may commence a new Extension Period, subject to theforegoing requirements. The Company must give the Trustee notice of itselection to begin such Extension Period at least one Business Day prior to theearlier of (i) the next succeeding date on which interest on the DebtSecurities would have been payable except for the election to begin such ExtensionPeriod or (ii) the date such interest is payable, but in any event not laterthan the related regular record date. The Trustee shall give notice of theCompany’s election to begin a new Extension Period to the Securityholders.

 

 

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SECTION 2.12  CUSIP Numbers.

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

ARTICLE III

PARTICULARCOVENANTS OF THE COMPANY

SECTION3.0l  Payment of Principal,Premium and Interest; Agreed Treatment of the Debt Securities.

(a)           The Companycovenants and agrees that it will duly and punctually pay or cause to be paidthe principal of and premium, if any, and interest on the Debt Securities atthe place, at the respective times and in the manner provided in this Indentureand the Debt Securities. At the option of the Company, each installment ofinterest on the Debt Securities may be paid (i) by mailing checks for suchinterest payable to the order of the holders of Debt Securities entitledthereto as they appear on the Debt Security Register or (ii) by wire transferto any account with a banking institution located in the United Statesdesignated by such Person to the paying agent no later than the related recorddate.

(b)           The Companywill treat the Debt Securities as indebtedness, and the amounts payable inrespect of the principal amount of such Debt Securities as interest, for allU.S. federal income tax purposes. All payments in respect of such DebtSecurities will be made free and clear of U.S. withholding tax to anybeneficial owner thereof that has provided an Internal Revenue Service Form W8BEN (or any substitute or successor form) establishing its non-US status forU.S. federal income tax purposes.

(c)           As of the date of thisIndenture, the Company has no intention to exercise its right under Section2.11 to defer payments of interest on the Debt Securities by commencing anExtension Period.

(d)           As of the date of thisIndenture, the Company believes that the likelihood that it would exercise itsright under Section 2.11 to defer payments of interest on the Debt Securitiesby commencing an Extension Period at any time during which the Debt Securitiesare outstanding is remote because of the restrictions that would be imposed onthe Company’s ability to declare or pay dividends or distributions on, or toredeem, purchase or make a liquidation payment with respect to, any of itsoutstanding equity and on the Company’s ability to make any payments ofprincipal of or interest on, or repurchase or redeem, any of its debtsecurities that *rank pari passu*inall respects with (or junior in interest to) the Debt Securities.

 

 

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SECTION 3.02  Offices for Notices and Payments, etc.

So long as any of the DebtSecurities remain outstanding, the Company will maintain in Wilmington,Delaware or in Sioux Falls, South Dakota, an office or agency where the DebtSecurities may be presented for payment, an office or agency where the DebtSecurities may be presented for registration of transfer and for exchange as inthis Indenture provided and an office or agency where notices and demands to orupon the Company in respect of the Debt Securities or of this Indenture may beserved. The Company will give to the Trustee written notice of the location ofany such office or agency and of any change of location thereof. Untilotherwise designated from time to time by the Company in a notice to theTrustee, or specified as contemplated by Section 2.05, such office or agencyfor all of the above purposes shall be the Principal Office of the Trustee. Incase the Company shall fail to maintain any such office or agency inWilmington, Delaware or in Sioux Falls, South Dakota, or shall fail to givesuch notice of the location or of any change in the location thereof,presentations and demands may be made and notices may be served at thePrincipal Office of the Trustee.

In addition to any suchoffice or agency, the Company may from time to time designate one or moreoffices or agencies outside Wilmington, Delaware or Sioux Falls, South Dakota,where the Debt Securities may be presented for registration of transfer and forexchange in the manner provided in this Indenture, and the Company may fromtime to time rescind such designation, as the Company may deem desirable orexpedient; provided, however, that no such designation orrescission shall in any manner relieve the Company of its obligation tomaintain any such office or agency in Wilmington, Delaware or in Sioux Falls,South Dakota, for the purposes above mentioned. The Company will give to theTrustee prompt written notice of any such designation or rescission thereof.

SECTION 3.03  Appointments to Fill Vacancies in Trustee’sOffice.

The Company, whenevernecessary to avoid or fill a vacancy in the office of Trustee, will appoint, inthe manner provided in Section 6.09, a Trustee, so that there shall at alltimes be a Trustee hereunder.

SECTION 3.04  Provision as to Paying Agent.

(a)           If the Companyshall appoint a paying agent other than the Trustee, it will cause such payingagent to execute and deliver to the Trustee an instrument in which such agentshall agree with the Trustee, subject to the provision of this Section 3.04,

(1)           that it will hold all sumsheld by it as such agent for the payment of the principal of and premium, ifany, or interest, if any, on the Debt Securities (whether such sums have beenpaid to it by the Company or by any other obligor on the Debt Securities) intrust for the benefit of the holders of the Debt Securities;

(2)           that it willgive the Trustee prompt written notice of any failure by the Company (or by anyother obligor on the Debt Securities) to make any payment of the principal ofand premium, if any, or interest, if any, on the Debt Securities when the sameshall be due and payable; and

 

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(3)           that it will, at any timeduring the continuance of any Event of Default, upon the written request of theTrustee, forthwith pay to the Trustee all sums so held in trust by such payingagent.

(b)           If the Companyshall act as its own paying agent, it will, on or before each due date of theprincipal of and premium, if any, or interest, if any, on the Debt Securities,set aside, segregate and hold in trust for the benefit of the holders of theDebt Securities a sum sufficient to pay such principal, premium or interest sobecoming due and will notify the Trustee in writing of any failure to take suchaction and of any failure by the Company (or by any other obligor under theDebt Securities) to make any payment of the principal of and premium, if any,or interest, if any, on the Debt Securities when the same shall become due andpayable.

Whenever the Company shallhave one or more paying agents for the Debt Securities, it will, on or prior toeach due date of the principal of and premium, if any, or interest, if any, onthe Debt Securities, deposit with a paying agent a sum sufficient to pay theprincipal, premium or interest so becoming due, such sum to be held in trustfor the benefit of the Persons entitled thereto and (unless such paying agentis the Trustee) the Company shall promptly notify the Trustee in writing of itsaction or failure to act.

(c)           Anything inthis Section 3.04 to the contrary notwithstanding, the Company may, at anytime, for the purpose of obtaining a satisfaction and discharge with respect tothe Debt Securities, or for any other reason, pay, or direct any paying agentto pay to the Trustee all sums held in trust by the Company or any such payingagent, such sums to be held by the Trustee upon the same terms and conditionsherein contained.

(d)           Anything in this Section3.04 to the contrary notwithstanding, the agreement to hold sums in trust asprovided in this Section 3.04 is subject to Sections 12.03 and 12.04.

(e)           The Company hereby initiallyappoints the Trustee to act as paying agent.

SECTION 3.05  Certificate to Trustee.

The Company will deliver to the Trustee on or before120 days after the end of each fiscal year, so long as Debt Securities areoutstanding hereunder, a Certificate stating that in the course of theperformance by the signers of their duties as officers of the Company theywould normally have knowledge of any default by the Company in the performanceof any covenants contained herein, stating whether or not they have knowledgeof any such default and, if so, specifying each such default of which thesigners have knowledge and the nature thereof.

SECTION 3.06  Additional Interest.

If and for so long as theTrust is the holder of all Debt Securities and is required to pay anyadditional taxes, duties, assessments or other governmental charges as a resultof a Tax Event, the Company will pay such additional amounts (the “AdditionalInterest”) on the Debt Securities as shall berequired so that the net amounts received and retained by the Trust afterpaying taxes, duties, assessments or other governmental charges will be equalto the amounts the Trust would have received if no such taxes, duties,assessments or other governmental charges had been imposed. Whenever in thisIndenture or the Debt Securities there is a reference in any context to thepayment of principal of or interest on the Debt Securities, such mention shallbe deemed to include mention of payments of the Additional Interest providedfor in this paragraph to the extent that, in such context, Additional Interestis, was or would be payable in respect thereof pursuant to the provisions ofthis paragraph and express mention of the payment of Additional Interest (ifapplicable) in any provisions hereof shall not be construed as excludingAdditional Interest in those provisions hereof where such express mention isnot made, provided, however, that the deferral of the payment ofinterest during an Extension Period pursuant to Section 2.11 shall not deferthe payment of any Additional Interest that may be due and payable.

 

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SECTION 3.07  Compliance with Consolidation Provisions.

The Company will not, while any of the DebtSecurities remain outstanding, consolidate with, or merge into, or merge intoitself, or sell or convey all or substantially all of its property to any otherPerson unless the provisions of Article XI hereof are complied with.

SECTION 3.08  Limitation on Dividends.

If Debt Securities areinitially issued to the Trust or a trustee of such Trust in connection with theissuance of Trust Securities by the Trust (regardless of whether DebtSecurities continue to be held by such Trust) and (i) there shall have occurredand be continuing an Event of Default, (ii) the Company shall be in defaultwith respect to its payment of any obligations under the Capital SecuritiesGuarantee or (iii) the Company shall have given notice of its election to deferpayments of interest on the Debt Securities by extending the interest paymentperiod as provided herein and such period, or any extension thereof, shall havecommenced and be continuing, then the Company may not (A) declare or pay anydividends or distributions on, or redeem, purchase, acquire, or make aliquidation payment with respect to, any of the Company’s capital stock or (B)make any payment of principal of or interest or premium, if any, on or repay,repurchase or redeem any debt securities of the Company that rank *pari passu*in all respects with or juniorin interest to the Debt Securities (other than (a)repurchases, redemptions or other acquisitions of shares of capital stock ofthe Company (I) in connection with any employment contract, benefit plan orother similar arrangement with or for the benefit of one or more employees,officers, directors or consultants, (II) in connection with a dividendreinvestment or stockholder stock purchase plan or (III) in connection with theissuance of capital stock of the Company (or securities convertible into orexercisable for such capital stock), as consideration in an acquisitiontransaction entered into prior to the occurrence of (i), (ii) or (iii) above,(b) as a result of any exchange or conversion of any class or series of theCompany’s capital stock (or any capital stock of a subsidiary of the Company)for any class or series of the Company’s capital stock or of any class orseries of the Company’s indebtedness for any class or series of the Company’scapital stock, (c) the purchase of fractional interests in shares of theCompany’s capital stock pursuant to the conversion or exchange provisions ofsuch capital stock or the security being converted or exchanged, (d) anydeclaration of a dividend in connection with any stockholder’s rights plan, orthe issuance of rights, stock or other property under any stockholder’s rightsplan, or the redemption or repurchase of rights pursuant thereto, or (e) anydividend in the form of stock, warrants, options or other rights where thedividend stock or the stock issuable upon exercise of such warrants, options orother rights is the same stock as that on which the dividend is being paid orranks *pari passu*with or juniorto such stock).

 

 

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SECTION 3.09  Covenants as to the Trust.

For so long as such TrustSecurities remain outstanding, the Company shall maintain 100% ownership of theCommon Securities; provided, however, that any permittedsuccessor of the Company under this Indenture that is a U.S. Person may succeedto the Company’s ownership of such Common Securities. The Company, as owner ofthe Common Securities, shall use commercially reasonable efforts to cause theTrust (a) to remain a statutory business trust, except in connection with adistribution of Debt Securities to the holders of Trust Securities inliquidation of the Trust, the redemption of all of the Trust Securities orcertain mergers, consolidations or amalgamations, each as permitted by theDeclaration, (b) to otherwise continue to be classified as a grantor trust forUnited States federal income tax purposes and (c) to cause each holder of TrustSecurities to be treated as owning an undivided beneficial interest in the DebtSecurities.

ARTICLE IV

LISTS AND REPORTS

BYTHE COMPANY AND THE TRUSTEE

SECTION 4.01  Securityholders’ Lists.

The Company covenants andagrees that it will furnish or cause to be furnished to the Trustee:

(a)           on each regularrecord date for an Interest Payment Date, a list, in such form as the Trusteemay reasonably require, of the names and addresses of the Securityholders ofthe Debt Securities as of such record date; and

(b)           at such othertimes as the Trustee may request in writing, within 30 days after the receiptby the Company of any such request, a list of similar form and content as of adate not more than 15 days prior to the time such list is furnished;

except that no such listsneed be furnished under this Section 4.01 so long as the Trustee is inpossession thereof by reason of its acting as Debt Security registrar.

SECTION 4.02  Preservation and Disclosure of Lists.

(a)           The Trusteeshall preserve, in as current a form as is reasonably practicable, allinformation as to the names and addresses of the holders of Debt Securities (1)contained in the most recent list furnished to it as provided in Section 4.01or (2) received by it in the capacity of Debt Securities registrar (if soacting) hereunder. The Trustee may destroy any list furnished to it as providedin Section 4.01 upon receipt of a new list so furnished.

(b)           In case threeor more holders of Debt Securities (hereinafter referred to as “applicants”)apply in writing to the Trustee and furnish to the Trustee reasonable proofthat each such applicant has owned a Debt Security for a period of at least sixmonths preceding the date of such application, and such application states thatthe applicants desire to communicate with other holders of Debt Securities withrespect to their rights under this Indenture or under such Debt Securities andis accompanied by a copy of the form of proxy or other communication which suchapplicants propose to transmit, then the Trustee shall within five BusinessDays after the receipt of such application, at its election, either:

 

 

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(1)           afford such applicantsaccess to the information preserved at the time by the Trustee in accordancewith the provisions of subsection (a) of this Section 4.02, or

(2)           inform such applicants as tothe approximate number of holders of Debt Securities whose names and addressesappear in the information preserved at the time by the Trustee in accordancewith the provisions of subsection (a) of this Section 4.02, and as to theapproximate cost of mailing to such Securityholders the form of proxy or othercommunication, if any, specified in such application.

If the Trustee shall electnot to afford such applicants access to such information, the Trustee shall,upon the written request of such applicants, mail to each Securityholder ofDebt Securities whose name and address appear in the information preserved atthe time by the Trustee in accordance with the provisions of subsection (a) ofthis Section 4.02 a copy of the form of proxy or other communication which isspecified in such request with reasonable promptness after a tender to theTrustee of the material to be mailed and of payment, or provision for thepayment, of the reasonable expenses of mailing, unless within five days aftersuch tender, the Trustee shall mail to such applicants and file with theSecurities and Exchange Commission, if permitted or required by applicable law,together with a copy of the material to be mailed, a written statement to theeffect that, in the opinion of the Trustee, such mailing would be contrary tothe best interests of the holders of all Debt Securities, as the case may be,or would be in violation of applicable law. Such written statement shallspecify the basis of such opinion. If said Commission, as permitted or requiredby applicable law, after opportunity for a hearing upon the objectionsspecified in the written statement so filed, shall enter an order refusing tosustain any of such objections or if, after the entry of an order sustainingone or more of such objections, said Commission shall find, after notice andopportunity for hearing, that all the objections so sustained have been met andshall enter an order so declaring, the Trustee shall mail copies of suchmaterial to all such Securityholders with reasonable promptness after the entryof such order and the renewal of such tender; otherwise the Trustee shall berelieved of any obligation or duty to such applicants respecting theirapplication.

(c)**          **Each and everyholder of Debt Securities, by receiving and holding the same, agrees with theCompany and the Trustee that neither the Company nor the Trustee nor any payingagent shall be held accountable by reason of the disclosure of any suchinformation as to the names and addresses of the holders of Debt Securities inaccordance with the provisions of subsection (b) of this Section 4.02,regardless of the source from which such information was derived, and that theTrustee shall not be held accountable by reason of mailing any materialpursuant to a request made under said subsection (b).

 

 

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ARTICLE V

REMEDIES OF THE TRUSTEE ANDSECURITYHOLDERS

UPONAN EVENT OF DEFAULT

SECTION 5.01  Events of Default.

Thefollowing events shall be “Events of Default” with respect to Debt Securities:

(a)           the Companydefaults in the payment of any interest upon any Debt Security when it becomesdue and payable, and continuance of such default for a period of 30 days; forthe avoidance of doubt, an extension of any interest payment period by theCompany in accordance with Section 2.11 of this Indenture shall not constitutea default under this clause 5.01(a); or

(b)**          **the Companydefaults in the payment of all or any part of the principal of (or premium, ifany, on) any Debt Securities as and when the same shall become due and payableeither at maturity, upon redemption, by declaration of acceleration orotherwise; or

(c)           the Companydefaults in the performance of, or breaches, any of its covenants or agreementsin Sections 3.06, 3.07, 3.08 and 3.09 of this Indenture (other than a covenantor agreement a default in whose performance or whose breach is elsewhere inthis Section specifically dealt with), and continuance of such default orbreach for a period of 90 days after there has been given, by registered orcertified mail, to the Company by the Trustee or to the Company and the Trusteeby the holders of not less than 25% in aggregate principal amount of theoutstanding Debt Securities, a written notice specifying such default or breachand requiring it to be remedied and stating that such notice is a “Notice ofDefault” hereunder; or

(d)           a court havingjurisdiction in the premises shall enter a decree or order for relief inrespect of the Company in an involuntary case under any applicable bankruptcy,insolvency or other similar law now or hereafter in effect, or appoints areceiver, liquidator, assignee, custodian, trustee, sequestrator (or similarofficial) of the Company or for any substantial part of its property, or ordersthe winding-up or liquidation of its affairs and such decree or order shallremain unstayed and in effect for a period of 90 consecutive days; or

(e)           the Companyshall commence a voluntary case under any applicable bankruptcy, insolvency orother similar law now or hereafter in effect, shall consent to the entry of anorder for relief in an involuntary case under any such law, or shall consent tothe appointment of or taking possession by a receiver, liquidator, assignee,trustee, custodian, sequestrator (or other similar official) of the Company orof any substantial part of its property, or shall make any general assignmentfor the benefit of creditors, or shall fail generally to pay its debts as theybecome due; or

(f)            the Trust shall havevoluntarily or involuntarily liquidated, dissolved, wound-up its business orotherwise terminated its existence except in connection with (1) thedistribution of the Debt Securities to holders of such Trust Securities inliquidation of their interests in the Trust, (2) the redemption of all of theoutstanding Trust Securities or (3) certain mergers, consolidations oramalgamations, each as permitted by the Declaration.

 

 

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If an Event of Default occursand is continuing with respect to the Debt Securities, then, and in each andevery such case, unless the principal of the Debt Securities shall have alreadybecome due and payable, either the Trustee or the holders of not less than 25%in aggregate principal amount of the Debt Securities then outstandinghereunder, by notice in writing to the Company (and to the Trustee if given bySecurityholders), may declare the entire principal of the Debt Securities andthe interest accrued thereon, if any, to be due and payable immediately, andupon 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 principalof the Debt Securities shall have been so declared due and payable, and beforeany judgment or decree for the payment of the moneys due shall have beenobtained or entered as hereinafter provided, (i) the Company shall pay or shalldeposit with the Trustee a sum sufficient to pay all matured installments ofinterest upon all the Debt Securities and the principal of and premium, if any,on the Debt Securities which shall have become due otherwise than byacceleration (with interest upon such principal and premium, if any, andDeferred Interest, to the extent permitted by law) and such amount as shall besufficient to cover reasonable compensation to the Trustee and each predecessorTrustee, their respective agents, attorneys and counsel, and all other amountsdue to the Trustee pursuant to Section 6.06, if any, and (ii) all Events ofDefault under this Indenture, other than the non-payment of the principal of orpremium, if any, on Debt Securities which shall have become due byacceleration, shall have been cured, waived or otherwise remedied as providedherein — then and in every such case the holders of a majority in aggregateprincipal amount of the Debt Securities then outstanding, by written notice tothe Company and to the Trustee, may waive all defaults and rescind and annulsuch declaration and its consequences, but no such waiver or rescission andannulment shall extend to or shall affect any subsequent default or shallimpair any right consequent thereon.

In case the Trustee shallhave proceeded to enforce any right under this Indenture and such proceedingsshall have been discontinued or abandoned because of such rescission orannulment or for any other reason or shall have been determined adversely tothe Trustee, then and in every such case the Company, the Trustee and theholders of the Debt Securities shall be restored respectively to their severalpositions and rights hereunder, and all rights, remedies and powers of theCompany, the Trustee and the holders of the Debt Securities shall continue asthough no such proceeding had been taken.

SECTION 5.02  Payment of Debt Securities on Default;Suit Therefor.

The Company covenants thatupon the occurrence of an Event of Default pursuant to clause 5.01(a) or5.01(b) and upon demand of the Trustee, the Company will pay to the Trustee,for the benefit of the holders of the Debt Securities, the whole amount thatthen shall have become due and payable on all Debt Securities for principal andpremium, if any, or interest, or both, as the case may be, including DeferredInterest accrued on the Debt Securities; and, in addition thereto, such furtheramount as shall be sufficient to cover the costs and expenses of collection,including a reasonable compensation to the Trustee, its agents, attorneys andcounsel, and any other amounts due to the Trustee under Section 6.06. In casethe Company shall fail forthwith to pay such amounts upon such demand, theTrustee, in its own name and as trustee of an express trust, shall be entitledand empowered to institute any actions or proceedings at law or in equity forthe collection of the sums so due and unpaid, and may prosecute any such actionor proceeding to judgment or final decree, and may enforce any such judgment orfinal decree against the Company or any other obligor on such Debt Securitiesand collect in the manner provided by law out of the property of the Company orany other obligor on such Debt Securities wherever situated the moneys adjudgedor decreed to be payable.

 

 

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In case there shall be pending proceedings for thebankruptcy or for the reorganization of the Company or any other obligor on theDebt Securities under Bankruptcy Law, or in case a receiver or trustee shallhave been appointed for the property of the Company or such other obligor, orin the case of any other similar judicial proceedings relative to the Companyor other obligor upon the Debt Securities, or to the creditors or property ofthe Company or such other obligor, the Trustee, irrespective of whether theprincipal of the Debt Securities shall then be due and payable as thereinexpressed or by declaration of acceleration or otherwise and irrespective ofwhether the Trustee shall have made any demand pursuant to the provisions ofthis Section 5.02, shall be entitled and empowered, by intervention in suchproceedings or otherwise, to file and prove a claim or claims for the wholeamount of principal and interest owing and unpaid in respect of the DebtSecurities and, in case of any judicial proceedings, to file such proofs ofclaim and other papers or documents as may be necessary or advisable in orderto have the claims of the Trustee (including any claim for reasonablecompensation to the Trustee and each predecessor Trustee, and their respectiveagents, attorneys and counsel, and for reimbursement of all other amounts dueto the Trustee under Section 6.(06) and of the Securityholders allowed in suchjudicial proceedings relative to the Company or any other obligor on the DebtSecurities, or to the creditors or property of the Company or such otherobligor, unless prohibited by applicable law and regulations, to vote on behalfof the holders of the Debt Securities in any election of a trustee or a standbytrustee in arrangement, reorganization, liquidation or other bankruptcy or insolvencyproceedings or Person performing similar functions in comparable proceedings,and to collect and receive any moneys or other property payable or deliverableon any such claims, and to distribute the same after the deduction of itscharges and expenses; and any receiver, assignee or trustee in bankruptcy orreorganization is hereby authorized by each of the Securityholders to make suchpayments to the Trustee, and, in the event that the Trustee shall consent tothe making of such payments directly to the Securityholders, to pay to theTrustee such amounts as shall be sufficient to cover reasonable compensation tothe Trustee, each predecessor Trustee and their respective agents, attorneysand counsel, and all other amounts due to the Trustee under Section 6.06.

Nothing herein contained shall be construed toauthorize the Trustee to authorize or consent to or accept or adopt on behalfof any Securityholder any plan of reorganization, arrangement, adjustment orcomposition affecting the Debt Securities or the rights of any holder thereofor to authorize the Trustee to vote in respect of the claim of anySecurityholder in any such proceeding.

All rights of action and ofasserting claims under this Indenture, or under any of the Debt Securities, maybe enforced by the Trustee without the possession of any of the DebtSecurities, or the production thereof at any trial or other proceeding relativethereto, and any such suit or proceeding instituted by the Trustee shall bebrought in its own name as trustee of an express trust, and any recovery ofjudgment shall be for the ratable benefit of the holders of the DebtSecurities.

 

 

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In any proceedings brought by the Trustee (and alsoany proceedings involving the interpretation of any provision of this Indentureto which the Trustee shall be a party) the Trustee shall be held to representall the holders of the Debt Securities, and it shall not be necessary to makeany holders of the Debt Securities parties to any such proceedings.

SECTION 5.03  Application of Moneys Collected byTrustee.

Any moneys collected by theTrustee shall be applied in the following order, at the date or dates fixed bythe Trustee for the distribution of such moneys, upon presentation of the severalDebt Securities in respect of which moneys have been collected, and stampingthereon the payment, if only partially paid, and upon surrender thereof iffully paid:

First: To the payment of costs and expenses incurredby, and reasonable fees of, the Trustee, its agents, attorneys and counsel, andof all other amounts due to the Trustee under Section 6.06;

Second: To the payment of all Senior Indebtedness ofthe Company if and to the extent required by Article XV;

Third: To the payment of theamounts then due and unpaid upon Debt Securities for principal (and premium, ifany), and interest on the Debt Securities, in respect of which or for thebenefit of which money has been collected, ratably, without preference orpriority of any kind, according to the amounts due on such Debt Securities forprincipal (and premium, if any) and interest, respectively; and

Fourth: The balance, if any, to the Company.

SECTION 5.04  Proceedings by Securityholders.

No holder of any DebtSecurity shall have any right to institute any suit, action or proceeding forany remedy hereunder, unless such holder previously shall have given to theTrustee written notice of an Event of Default with respect to the DebtSecurities and unless the holders of not less than 25% in aggregate principalamount of the Debt Securities then outstanding shall have given the Trustee awritten request to institute such action, suit or proceeding and shall haveoffered to the Trustee such reasonable indemnity as it may require against thecosts, expenses and liabilities to be incurred thereby, and the Trustee for 60days after its receipt of such notice, request and offer of indemnity shallhave failed to institute any such action, suit or proceeding; provided,that no holder of Debt Securities shall have any right to prejudice the rightsof any other holder of Debt Securities, obtain priority or preference over anyother such holder or enforce any right under this Indenture except in themanner herein provided and for the equal, ratable and common benefit of allholders of Debt Securities.

Notwithstanding any otherprovisions in this Indenture, however, the right of any holder of any DebtSecurity to receive payment of the principal of, premium, if any, and intereston such Debt Security when due, or to institute suit for the enforcement of anysuch payment, shall not be impaired or affected without the consent of suchholder. For the protection and enforcement of the provisions of this Section,each and every Securityholder and the Trustee shall be entitled to such reliefas can be given either at law or in equity.

 

 

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SECTION 5.05   Proceedings by Trustee.

In case of an Event ofDefault hereunder the Trustee may in its discretion proceed to protect and enforcethe rights vested in it by this Indenture by such appropriate judicialproceedings as the Trustee shall deem most effectual to protect and enforce anyof such rights, either by suit in equity or by action at law or by proceedingin bankruptcy or otherwise, whether for the specific enforcement of anycovenant or agreement contained in this Indenture or in aid of the exercise ofany power granted in this Indenture, or to enforce any other legal or equitableright vested in the Trustee by this Indenture or by law.

SECTION 5.06  Remedies Cumulative and Continuing.

Except as otherwise providedin Section 2.06, all powers and remedies given by this Article V to the Trusteeor to the Securityholders shall, to the extent permitted by law, be deemedcumulative and not exclusive of any other powers and remedies available to theTrustee or the holders of the Debt Securities, by judicial proceedings orotherwise, to enforce the performance or observance of the covenants andagreements contained in this Indenture or otherwise established with respect tothe Debt Securities, and no delay or omission of the Trustee or of any holderof any of the Debt Securities to exercise any right or power accruing upon anyEvent of Default occurring and continuing as aforesaid shall impair any suchright or power, or shall be construed to be a waiver of any such default or anacquiescence therein; and, subject to the provisions of Section 5.04, everypower and remedy given by this Article V or by law to the Trustee or to theSecurityholders may be exercised from time to time, and as often as shall bedeemed expedient, by the Trustee or by the Securityholders.

SECTION5.07  Direction of Proceedingsand Waiver of Defaults by Majority of Securityholders.

The holders of a majority inaggregate principal amount of the Debt Securities affected (voting as oneclass) at the time outstanding shall have the right to direct the time, method,and place of conducting any proceeding for any remedy available to the Trustee,or exercising any trust or power conferred on the Trustee with respect to suchDebt Securities; provided, however, that (subject to theprovisions of Section 6.01) the Trustee shall have the right to decline tofollow any such direction if the Trustee shall determine that the action sodirected would be unjustly prejudicial to the holders not taking part in suchdirection or if the Trustee being advised by counsel determines that the actionor proceeding so directed may not lawfully be taken or if a Responsible Officerof the Trustee shall determine that the action or proceedings so directed wouldinvolve the Trustee in personal liability. Prior to any declarationaccelerating the maturity of the Debt Securities, the holders of a majority inaggregate principal amount of the Debt Securities at the time outstanding mayon behalf of the holders of all of the Debt Securities waive (or modify anypreviously granted waiver of) any past default or Event of Default and itsconsequences, except a default (a) in the payment of principal of, premium, ifany, or interest on any of the Debt Securities, (b) in respect of covenants orprovisions hereof which cannot be modified or amended without the consent ofthe holder of each Debt Security affected, or (c) in respect of the covenantscontained in Section 3.09; provided, however, that if the DebtSecurities are held by the Trust or a trustee of such trust, such waiver ormodification to such waiver shall not be effective until the holders of amajority in liquidation preference of Trust Securities of the Trust shall haveconsented to such waiver or modification to such waiver; provided, further,that if the consent of the holder of each outstanding Debt Security isrequired, such waiver shall not be effective until each holder of the TrustSecurities of the Trust shall have consented to such waiver. Upon any suchwaiver, the default covered thereby shall be deemed to be cured for allpurposes of this Indenture and the Company, the Trustee and the holders of theDebt Securities shall be restored to their former positions and rightshereunder, respectively; but no such waiver shall extend to any subsequent orother default or Event of Default or impair any right consequent thereon.Whenever any default or Event of Default hereunder shall have been waived aspermitted by this Section 5.07, said default or Event of Default shall for allpurposes of the Debt Securities and this Indenture be deemed to have been curedand to be not continuing.

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SECTION 5.08  Notice of Defaults.

The Trustee shall, within 90days after a Responsible Officer of the Trustee shall have actual knowledge orreceived written notice of the occurrence of a default with respect to the DebtSecurities, mail to all Securityholders, as the names and addresses of suchholders appear upon the Debt Security Register, notice of all defaults withrespect to the Debt Securities known to the Trustee, unless such defaults shallhave been cured before the giving of such notice (the term “defaults” for thepurpose of this Section 5.08 being hereby defined to be the events specified insubsections (a), (b), (c), (d) and (e) of Section 5.01, not including periodsof grace, if any, provided for therein); provided, that, except in thecase of default in the payment of the principal of, premium, if any, orinterest on any of the Debt Securities, the Trustee shall be protected inwithholding such notice if and so long as a Responsible Officer of the Trusteein good faith determines that the withholding of such notice is in theinterests of the Securityholders.

SECTION 5.09  Undertaking to Pay Costs.

All parties to thisIndenture agree, and each holder of any Debt Security by his acceptance thereofshall 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 Indenture, orin any suit against the Trustee for any action taken or omitted by it asTrustee, the filing by any party litigant in such suit of an undertaking to paythe costs of such suit, and that such court may in its discretion assessreasonable costs, including reasonable attorneys’ fees and expenses, againstany party litigant in such suit, having due regard to the merits and good faithof the claims or defenses made by such party litigant; but the provisions ofthis Section 5.09 shall not apply to any suit instituted by the Trustee, to anysuit instituted by any Securityholder, or group of Securityholders, holding inthe aggregate more than 10% in principal amount of the Debt Securitiesoutstanding, or to any suit instituted by any Securityholder for theenforcement of the payment of the principal of (or premium, if any) or intereston any Debt Security against the Company on or after the same shall have becomedue and payable.

 

 

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ARTICLE VI

CONCERNINGTHE TRUSTEE

SECTION 6.01  Duties and Responsibilities of Trustee.

With respect to the holdersof Debt Securities issued hereunder, the Trustee, prior to the occurrence of anEvent of Default with respect to the Debt Securities and after the curing orwaiving of all Events of Default which may have occurred, with respect to theDebt Securities, undertakes to perform such duties and only such duties as arespecifically set forth in this Indenture. In case an Event of Default withrespect to the Debt Securities has occurred (which has not been cured orwaived) the Trustee shall exercise such of the rights and powers vested in itby this Indenture, and use the same degree of care and skill in their exercise,as a prudent man would exercise or use under the circumstances in the conductof his own affairs.

No provision of thisIndenture shall be construed to relieve the Trustee from liability for its ownnegligent action, its own negligent failure to act or its own willfulmisconduct, except that:

(a)           prior to the occurrence of an Event of Default withrespect to Debt Securities and after the curing or waiving of all Events ofDefault which may have occurred

(1)           the duties and obligationsof the Trustee with respect to Debt Securities shall be determined solely bythe express provisions of this Indenture, and the Trustee shall not be liableexcept for the performance of such duties and obligations with respect to theDebt Securities as are specifically set forth in this Indenture, and no impliedcovenants or obligations shall be read into this Indenture against the Trustee,and

(2)           in the absence of bad faithon the part of the Trustee, the Trustee may conclusively rely, as to the truthof the statements and the correctness of the opinions expressed therein, uponany certificates or opinions furnished to the Trustee and conforming to therequirements of this Indenture; but, in the case of any such certificates oropinions which by any provision hereof are specifically required to befurnished to the Trustee, the Trustee shall be under a duty to examine the sameto determine whether or not they conform on their face to the requirements ofthis Indenture;

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

(c)**          **the Trusteeshall not be liable with respect to any action taken or omitted to be taken byit in good faith, in accordance with the direction of the Securityholderspursuant to Section 5.07, relating to the time, method and place of conductingany proceeding for any remedy available to the Trustee, or exercising any trustor power conferred upon the Trustee, under this Indenture; and

(d)           the Trustee shall not be charged with knowledge of anyDefault or Event of Default with respect to the Debt Securities unless either(1) a Responsible Officer shall have actual knowledge of such Default or Eventof Default or (2) written notice of such Default or Event of Default shall havebeen given to the Trustee by the Company or any other obligor on the DebtSecurities or by any holder of the Debt Securities, except with respect to anEvent of Default pursuant to Sections 5.01 (a) or 5.01 (b) hereof (other thanan Event of Default resulting from the default in the payment of AdditionalInterest or premium, if any, if the Trustee does not have actual knowledge orwritten notice that such payment is due and payable), of which the Trusteeshall be deemed to have knowledge.

 

 

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None of the provisionscontained in this Indenture shall require the Trustee to expend or risk its ownfunds or otherwise incur personal financial liability in the performance of anyof its duties or in the exercise of any of its rights or powers.

SECTION 6.02  Reliance on Documents, Opinions, etc.

Except as otherwise provided in Section 6.01:

(a)           the Trustee mayconclusively rely and shall be fully protected in acting or refraining fromacting upon any resolution, certificate, statement, instrument, opinion,report, notice, request, consent, order, bond, note, debenture or other paperor document believed by it in good faith to be genuine and to have been signedor presented by the proper party or parties;

(b)           any request,direction, order or demand of the Company mentioned herein shall besufficiently evidenced by an Officers’ Certificate (unless other evidence inrespect thereof be herein specifically prescribed); and any Board Resolutionmay be evidenced to the Trustee by a copy thereof certified by the Secretary oran Assistant Secretary of the Company;

(c)           the Trustee may consult withcounsel of its selection and any advice or Opinion of Counsel shall be full andcomplete authorization and protection in respect of any action taken, sufferedor omitted by it hereunder in good faith and in accordance with such advice orOpinion of Counsel;

(d)           the Trustee shallbe under no obligation to exercise any of the rights or powers vested in it bythis Indenture at the request, order or direction of any of theSecurityholders, pursuant to the provisions of this Indenture, unless suchSecurityholders shall have offered to the Trustee reasonable security orindemnity against the costs, expenses and liabilities which may be incurredtherein or thereby;

(e)           the Trustee shall not beliable for any action taken or omitted by it in good faith and believed by itto be authorized or within the discretion or rights or powers conferred upon itby this Indenture; nothing contained herein shall, however, relieve the Trusteeof the obligation, upon the occurrence of an Event of Default with respect tothe Debt Securities (that has not been cured or waived) to exercise withrespect to Debt Securities such of the rights and powers vested in it by thisIndenture, and to use the same degree of care and skill in their exercise, as aprudent man would exercise or use under the circumstances in the conduct of hisown affairs;

(f)            the Trusteeshall not be bound to make any investigation into the facts or matters statedin any resolution, certificate, statement, instrument, opinion, report, notice,request, consent, order, approval, bond, debenture, coupon or other paper ordocument, unless requested in writing to do so by the holders of not less thana majority in principal amount of the outstanding Debt Securities affectedthereby; provided, however, that if the payment within areasonable time to the Trustee of the costs, expenses or liabilities likely tobe incurred by it in the making of such investigation is, in the opinion of theTrustee, not reasonably assured to the Trustee by the security afforded to itby the terms of this Indenture, the Trustee may require reasonable indemnityagainst such expense or liability as a condition to so proceeding; and

 

 

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(g)           the Trustee mayexecute any of the trusts or powers hereunder or perform any duties hereundereither directly or by or through agents (including any Authenticating Agent) orattorneys, and the Trustee shall not be responsible for any misconduct ornegligence on the part of any such agent or attorney appointed by it with duecare.

SECTION 6.03  No Responsibility for Recitals, etc.

The recitals containedherein and in the Debt Securities (except in the certificate of authenticationof the Trustee or the Authenticating Agent) shall be taken as the statements ofthe Company and the Trustee and the Authenticating Agent assume noresponsibility for the correctness of the same. The Trustee and theAuthenticating Agent make no representations as to the validity or sufficiencyof this Indenture or of the Debt Securities. The Trustee and the AuthenticatingAgent shall not be accountable for the use or application by the Company of anyDebt Securities or the proceeds of any Debt Securities authenticated anddelivered by the Trustee or the Authenticating Agent in conformity with theprovisions of this Indenture.

SECTION 6.04  Trustee,Authenticating Agent, Paying Agents, Transfer Agents or Registrar May Own DebtSecurities.

The Trustee or anyAuthenticating Agent or any paying agent or any transfer agent or any DebtSecurity registrar, in its individual or any other capacity, may become theowner or pledgee of Debt Securities with the same rights it would have if itwere not Trustee, Authenticating Agent, paying agent, transfer agent or DebtSecurity registrar.

SECTION 6.05  Moneys to be Held in Trust.

Subject to the provisions ofSection 12.04, all moneys received by the Trustee or any paying agent shall,until used or applied as herein provided, be held in trust for the purpose forwhich they were received, but need not be segregated from other funds except tothe extent required by law. The Trustee and any paying agent shall be under noliability for interest on any money received by it hereunder except asotherwise agreed in writing with the Company. So long as no Event of Defaultshall have occurred and be continuing, all interest allowed on any such moneys,if any, shall be paid from time to time to the Company upon the written orderof the Company, signed by the Chairman of the Board of Directors, thePresident, the Chief Operating Officer, a Vice President, the Treasurer or anAssistant Treasurer of the Company.

SECTION 6.06  Compensation and Expenses of Trustee.

 

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The Company covenants andagrees to pay to the Trustee from time to time, and the Trustee shall beentitled to, such compensation as shall be agreed to in writing between theCompany and the Trustee (which shall not be limited by any provision of law inregard to the compensation of a trustee of an express trust), and the Companywill pay or reimburse the Trustee upon its written request for all documentedreasonable expenses, disbursements and advances incurred or made by the Trusteein accordance with any of the provisions of this Indenture (including thereasonable compensation and the reasonable expenses and disbursements of itscounsel and of all Persons not regularly in its employ) except any suchexpense, disbursement or advance that arises from its negligence or bad faith.The Company also covenants to indemnify each of the Trustee (including in itsindividual capacity) and any predecessor Trustee (and its officers, agents,directors and employees) for, and to hold it harmless against, any and allloss, damage, claim, liability or expense including taxes (other than taxesbased on the income of the Trustee), except to the extent such loss, damage,claim, liability or expense results from the negligence or bad faith of suchindemnitee, arising out of or in connection with the acceptance oradministration of this trust, including the costs and expenses of defendingitself against any claim or liability in the premises. The obligations of theCompany under this Section 6.06 to compensate and indemnify the Trustee and topay or reimburse the Trustee for documented expenses, disbursements andadvances shall constitute additional indebtedness hereunder. Such additionalindebtedness shall be secured by a lien prior to that of the Debt Securitiesupon all property and funds held or collected by the Trustee as such, exceptfunds held in trust for the benefit of the holders of particular DebtSecurities.

 

Without prejudice to anyother rights available to the Trustee under applicable law, when the Trusteeincurs expenses or renders services in connection with an Event of Defaultspecified in subsections (d), (e) or (f) of Section 5.01, the expenses(including the reasonable charges and expenses of its counsel) and thecompensation for the services are intended to constitute expenses ofadministration under any applicable federal or state bankruptcy, insolvency orother similar law.

The provisions of thisSection shall survive the resignation or removal of the Trustee and thedefeasance or other termination of this Indenture.

SECTION 6.07  Officers’ Certificate as Evidence.

Except as otherwise providedin Sections 6.01 and 6.02, whenever in the administration of the provisions ofthis Indenture the Trustee shall deem it necessary or desirable that a matterbe proved or established prior to taking or omitting any action hereunder, suchmatter (unless other evidence in respect thereof be herein specificallyprescribed) may, in the absence of negligence or bad faith on the part of theTrustee, be deemed to be conclusively proved and established by an OfficersCertificate delivered to the Trustee, and such certificate, in the absence ofnegligence or bad faith on the part of the Trustee, shall be full warrant tothe Trustee for any action taken or omitted by it under the provisions of thisIndenture upon the faith thereof.

SECTION 6.08  Eligibility of Trustee.

The Trustee hereunder shallat all times be a U.S. Person that is a banking corporation organized and doingbusiness under the laws of the United States of America or any state thereof orof the District of Columbia and authorized under such laws to exercisecorporate trust powers, having a combined capital and surplus of at least fiftymillion U.S. dollars ($50,000,000) and subject to supervision or examination byfederal, state, or District of Columbia authority. If such corporationpublishes reports of condition at least annually, pursuant to law or to therequirements of the aforesaid supervising or examining authority, then for thepurposes of this Section 6.08 the combined capital and surplus of suchcorporation shall be deemed to be its combined capital and surplus as set forthin its most recent records of condition so published.

 

 

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The Company may not, nor mayany Person directly or indirectly controlling, controlled by, or under commoncontrol with the Company, serve as Trustee, notwithstanding that suchcorporation shall be otherwise eligible and qualified under this Article.

In case at any time theTrustee shall cease to be eligible in accordance with the provisions of thisSection 6.08, the Trustee shall resign immediately in the manner and with theeffect specified in Section 6.09.

If the Trustee has or shallacquire any “conflicting interest” within the meaning of § 310(b) of the TrustIndenture Act, the Trustee shall either eliminate such interest or resign, tothe extent and in the manner provided by, and subject to this Indenture.

SECTION 6.09  Resignation or Removal of Trustee.

(a)           The Trustee, orany trustee or trustees hereafter appointed, may at any time resign by givingwritten notice of such resignation to the Company and by mailing noticethereof, at the Company’s expense, to the holders of the Debt Securities attheir addresses as they shall appear on the Debt Security Register. Uponreceiving such notice of resignation, the Company shall promptly appoint asuccessor trustee or trustees by written instrument, in duplicate, executed byorder of its Board of Directors, one copy of which instrument shall bedelivered to the resigning Trustee and one copy to the successor Trustee. If nosuccessor Trustee shall have been so appointed and have accepted appointmentwithin 30 days after the mailing of such notice of resignation to the affectedSecurityholders, the resigning Trustee may petition any court of competentjurisdiction for the appointment of a successor Trustee, or any Securityholderwho has been a bona fide holder of a Debt Security or Debt Securities for atleast six months may, subject to the provisions of Section 5.09, on behalf ofhimself and all others similarly situated, petition any such court for theappointment of a successor Trustee. Such court may thereupon, after suchnotice, if any, as it may deem proper and prescribe, appoint a successorTrustee.

(b)**          **In case at anytime any of the following shall occur —

(1)           the Trusteeshall fail to comply with the provisions of the last paragraph of Section 6.08after written request therefor by the Company or by any Securityholder who hasbeen a bona fide holder of a Debt Security or Debt Securities for at least sixmonths,

 

 

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(2)           the Trustee shall cease tobe eligible in accordance with the provisions of Section 6.08 and shall fail toresign after written request therefor by the Company or by any suchSecurityholder, or

(3)           the Trustee shall becomeincapable of acting, or shall be adjudged a bankrupt or insolvent, or areceiver of the Trustee or of its property shall be appointed, or any publicofficer shall take charge or control of the Trustee or of its property oraffairs for the purpose of rehabilitation, conservation or liquidation,

then, in any such case, theCompany may remove the Trustee and appoint a successor Trustee by writteninstrument, in duplicate, executed by order of the Board of Directors, one copyof which instrument shall be delivered to the Trustee so removed and one copyto the successor Trustee, or, subject to the provisions of Section 5.09, if nosuccessor Trustee shall have been so appointed and have accepted appointmentwithin 30 days of the occurrence of any of (l),(2) or (3) above, anySecurityholder who has been a bona fide holder of a Debt Security or DebtSecurities for at least six months may, on behalf of himself and all otherssimilarly situated, petition any court of competent jurisdiction for the removalof the Trustee and the appointment of a successor Trustee. Such court maythereupon, after such notice, if any, as it may deem proper and prescribe,remove the Trustee and appoint a successor Trustee.

(c)           Upon priorwritten notice to the Company and the Trustee, the holders of a majority inaggregate principal amount of the Debt Securities at the time outstanding mayat any time remove the Trustee and nominate a successor Trustee, which shall bedeemed appointed as successor Trustee unless within ten Business Days aftersuch nomination the Company objects thereto, in which case or in the case of afailure by such holders to nominate a successor Trustee, the Trustee so removedor any Securityholder, upon the terms and conditions and otherwise as in subsection(a) of this Section 6.09 provided, may petition any court of competentjurisdiction for an appointment of a successor.

(d)           Any resignationor removal of the Trustee and appointment of a successor Trustee pursuant toany of the provisions of this Section 6.09 shall become effective uponacceptance of appointment by the successor Trustee as provided in Section 6.10.

SECTION 6.10  Acceptance by Successor Trustee.

Any successor Trusteeappointed as provided in Section 6.09 shall execute, acknowledge and deliver tothe Company and to its predecessor Trustee an instrument accepting suchappointment hereunder, and thereupon the resignation or removal of the retiringTrustee shall become effective and such successor Trustee, without any furtheract, deed or conveyance, shall become vested with all the rights, powers,duties and obligations with respect to the Debt Securities of its predecessorhereunder, with like effect as if originally named as Trustee herein; but,nevertheless, on the written request of the Company or of the successorTrustee, the Trustee ceasing to act shall, upon payment of the amounts then dueit pursuant to the provisions of Section 6.06, execute and deliver aninstrument transferring to such successor Trustee all the rights and powers of theTrustee so ceasing to act and shall duly assign, transfer and deliver to suchsuccessor Trustee all property and money held by such retiring Trusteethereunder. Upon request of any such successor Trustee, the Company shallexecute any and all instruments in writing for more fully and certainly vestingin and confirming to such successor Trustee all such rights and powers. AnyTrustee ceasing to act shall, nevertheless, retain a lien upon all property orfunds held or collected by such Trustee to secure any amounts then due itpursuant to the provisions of Section 6.06.

 

 

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If a successor Trustee isappointed, the Company, the retiring Trustee and the successor Trustee shallexecute and deliver an indenture supplemental hereto which shall contain suchprovisions as shall be deemed necessary or desirable to confirm that all therights, powers, trusts and duties of the retiring Trustee with respect to theDebt Securities as to which the predecessor Trustee is not retiring shallcontinue to be vested in the predecessor Trustee, and shall add to or changeany of the provisions of this Indenture as shall be necessary to provide for orfacilitate the administration of the Trust hereunder by more than one Trustee,it being understood that nothing herein or in such supplemental indenture shallconstitute such Trustees co-trustees of the same trust and that each suchTrustee shall be Trustee of a trust or trusts hereunder separate and apart fromany trust or trusts hereunder administered by any other such Trustee.

No successor Trustee shallaccept appointment as provided in this Section 6.10 unless at the time of suchacceptance such successor Trustee shall be eligible under the provisions ofSection 6.08.

In no event shall a retiring Trustee be liable forthe acts or omissions of any successor Trustee hereunder.

Upon acceptance ofappointment by a successor Trustee as provided in this Section 6.10, theCompany shall mail notice of the succession of such Trustee hereunder to theholders of Debt Securities at their addresses as they shall appear on the DebtSecurity Register. If the Company fails to mail such notice within ten BusinessDays after the acceptance of appointment by the successor Trustee, thesuccessor Trustee shall cause such notice to be mailed at the expense of theCompany.

SECTION 6.11  Succession by Merger, etc.

Any corporation into whichthe Trustee may be merged or converted or with which it may be consolidated, orany corporation resulting from any merger, conversion or consolidation to whichthe Trustee shall be a party, or any corporation succeeding to all orsubstantially all of the corporate trust business of the Trustee, shall be thesuccessor of the Trustee hereunder without the execution or filing of any paperor any further act on the part of any of the parties hereto; provided,that such corporation shall be otherwise eligible and qualified under thisArticle.

In case at the time suchsuccessor to the Trustee shall succeed to the trusts created by this Indentureany of the Debt Securities shall have been authenticated but not delivered, anysuch successor to the Trustee may adopt the certificate of authentication ofany predecessor Trustee, and deliver such Debt Securities so authenticated; andin case at that time any of the Debt Securities shall not have beenauthenticated, any successor to the Trustee may authenticate such DebtSecurities either in the name of any predecessor hereunder or in the name ofthe successor Trustee; and in all such cases such certificates shall have thefull force which it is anywhere in the Debt Securities or in this Indentureprovided that the certificate of the Trustee shall have; provided, however,that the right to adopt the certificate of authentication of any predecessorTrustee or authenticate Debt Securities in the name of any predecessor Trusteeshall apply only to its successor or successors by merger, conversion orconsolidation.

 

 

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SECTION6.12  Authenticating Agents.

 

There may be one or moreAuthenticating Agents appointed by the Trustee upon the request of the Companywith power to act on its behalf and subject to its direction in theauthentication and delivery of Debt Securities issued upon exchange orregistration of transfer thereof as fully to all intents and purposes as thoughany such Authenticating Agent had been expressly authorized to authenticate anddeliver Debt Securities; provided, that the Trustee shall have noliability to the Company for any acts or omissions of the Authenticating Agentwith respect to the authentication and delivery of Debt Securities. Any suchAuthenticating Agent shall at all times be a corporation organized and doingbusiness under the laws of the United States or of any state or territorythereof or of the District of Columbia authorized under such laws to act asAuthenticating Agent, having a combined capital and surplus of at least$50,000,000 and being subject to supervision or examination by federal, state,territorial or District of Columbia authority. If such corporation publishesreports of condition at least annually pursuant to law or the requirements ofsuch authority, then for the purposes of this Section 6.12 the combined capitaland surplus of such corporation shall be deemed to be its combined capital andsurplus as set forth in its most recent report of condition so published. If atany time an Authenticating Agent shall cease to be eligible in accordance withthe provisions of this Section, it shall resign immediately in the manner andwith the effect herein specified in this Section.

Any corporation into whichany Authenticating Agent may be merged or converted or with which it may beconsolidated, or any corporation resulting from any merger, consolidation orconversion to which any Authenticating Agent shall be a party, or anycorporation succeeding to all or substantially all of the corporate trustbusiness of any Authenticating Agent, shall be the successor of suchAuthenticating Agent hereunder, if such successor corporation is otherwiseeligible under this Section 6.12 without the execution or filing of any paperor any further act on the part of the parties hereto or such AuthenticatingAgent.

Any Authenticating Agent mayat any time resign by giving written notice of resignation to the Trustee andto the Company. The Trustee may at any time terminate the agency of anyAuthenticating Agent with respect to the Debt Securities by giving writtennotice of termination to such Authenticating Agent and to the Company. Uponreceiving such a notice of resignation or upon such a termination, or in caseat any time any Authenticating Agent shall cease to be eligible under thisSection 6.12, the Trustee may, and upon the request of the Company shall,promptly appoint a successor Authenticating Agent eligible under this Section6.12, shall give written notice of such appointment to the Company and shallmail notice of such appointment to all holders of Debt Securities as the namesand addresses of such holders appear on the Debt Security Register. Anysuccessor Authenticating Agent upon acceptance of its appointment hereundershall become vested with all rights, powers, duties and responsibilities withrespect to the Debt Securities of its predecessor hereunder, with like effectas if originally named as Authenticating Agent herein.

 

 

 

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The Company agrees to pay to any AuthenticatingAgent from time to time reasonable compensation for its services. AnyAuthenticating Agent shall have no responsibility or liability for any actiontaken by it as such in accordance with the directions of the Trustee.

ARTICLE VII

CONCERNINGTHE SECURITYHOLDERS

SECTION 7.01  Action by Securityholders.

Whenever in this Indentureit is provided that the holders of a specified percentage in aggregateprincipal amount of the Debt Securities may take any action (including themaking of any demand or request, the giving of any notice, consent or waiver orthe taking of any other action), the fact that at the time of taking any suchaction the holders of such specified percentage have joined therein may beevidenced (a) by any instrument or any number of instruments of similar tenorexecuted by such Securityholders in person or by agent or proxy appointed inwriting, or (b) by the record of such holders of Debt Securities voting infavor thereof at any meeting of such Securityholders duly called and held inaccordance with the provisions of Article VIII, or (c) by a combination of suchinstrument or instruments and any such record of such a meeting of suchSecurityholders or (d) by any other method the Trustee deems satisfactory.

If the Company shall solicitfrom the Securityholders any request, demand, authorization, direction, notice,consent, waiver or other action or revocation of the same, the Company may, atits option, as evidenced by an Officers’ Certificate, fix in advance a recorddate for such Debt Securities for the determination of Securityholders entitledto give such request, demand, authorization, direction, notice, consent, waiveror other action or revocation of the same, but the Company shall have noobligation to do so. If such a record date is fixed, such request, demand,authorization, direction, notice, consent, waiver or other action or revocationof the same may be given before or after the record date, but only theSecurityholders of record at the close of business on the record date shall bedeemed to be Securityholders for the purposes of determining whetherSecurityholders of the requisite proportion of outstanding Debt Securities haveauthorized or agreed or consented to such request, demand, authorization,direction, notice, consent, waiver or other action or revocation of the same,and for that purpose the outstanding Debt Securities shall be computed as ofthe record date; provided, however, that no such authorization,agreement or consent by such Securityholders on the record date shall be deemedeffective unless it shall become effective pursuant to the provisions of thisIndenture not later than six months after the record date.

SECTION 7.02  Proof of Execution by Securityholders.

Subject to the provisions ofSections 6.01, 6.02 and 8.05, proof of the execution of any instrument by aSecurityholder or his agent or proxy shall be sufficient if made in accordancewith such reasonable rules and regulations as may be prescribed by the Trusteeor in such manner as shall be satisfactory to the Trustee. The ownership ofDebt Securities shall be proved by the Debt Security Register or by acertificate of the Debt Security registrar. The Trustee may require suchadditional proof of any matter referred to in this Section as it shall deemnecessary.

 

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The record of anySecurityholders’ meeting shall be proved in the manner provided in Section8.06.

SECTION 7.03  Who Are Deemed Absolute Owners.

Prior to due presentment for registration oftransfer of any Debt Security, the Company, the Trustee, any AuthenticatingAgent, any paying agent, any transfer agent and any Debt Security registrar maydeem the Person in whose name such Debt Security shall be registered upon theDebt Security Register to be, and may treat him as, the absolute owner of suchDebt Security (whether or not such Debt Security shall be overdue) for thepurpose of receiving payment of or on account of the principal of, premium, ifany, and interest on such Debt Security and for all other purposes; and neitherthe Company nor the Trustee nor any Authenticating Agent nor any paying agentnor any transfer agent nor any Debt Security registrar shall be affected by anynotice to the contrary. All such payments so made to any holder for the timebeing or upon his order shall be valid, and, to the extent of the sum or sums sopaid, effectual to satisfy and discharge the liability for moneys payable uponany such Debt Security.

SECTION 7.04  Debt Securities Owned by Company DeemedNot Outstanding.

In determining whether theholders of the requisite aggregate principal amount of Debt Securities haveconcurred in any direction, consent or waiver under this Indenture, DebtSecurities which are owned by the Company or any other obligor on the DebtSecurities or by any Person directly or indirectly controlling or controlled byor under direct or indirect common control with the Company or any otherobligor on the Debt Securities shall be disregarded and deemed not to beoutstanding for the purpose of any such determination; provided, thatfor the purposes of determining whether the Trustee shall be protected inrelying on any such direction, consent or waiver, only Debt Securities which aResponsible Officer of the Trustee actually knows are so owned shall be sodisregarded. Debt Securities so owned which have been pledged in good faith maybe regarded as outstanding for the purposes of this Section 7.04 if the pledgeeshall establish to the satisfaction of the Trustee the pledgee’s right to votesuch Debt Securities and that the pledgee is not the Company or any such otherobligor or Person directly or indirectly controlling or controlled by or underdirect or indirect common control with the Company or any such other obligor.In the case of a dispute as to such right, any decision by the Trustee takenupon the advice of counsel shall be full protection to the Trustee.

SECTION 7.05  Revocation of Consents; Future HoldersBound.

At any time prior to (butnot after) the evidencing to the Trustee, as provided in Section 7.01, of thetaking of any action by the holders of the percentage in aggregate principalamount of the Debt Securities specified in this Indenture in connection withsuch action, any holder (in cases where no record date has been set pursuant toSection 7.01) or any holder as of an applicable record date (in cases where a recorddate has been set pursuant to Section 7.01) of a Debt Security (or any DebtSecurity issued in whole or in part in exchange or substitution therefor) theserial number of which is shown by the evidence to be included in the DebtSecurities the holders of which have consented to such action may, by filingwritten notice with the Trustee at the Principal Office of the Trustee and uponproof of holding as provided in Section 7.02, revoke such action so far asconcerns such Debt Security (or so far as concerns the principal amountrepresented by any exchanged or substituted Debt Security). Except as aforesaidany such action taken by the holder of any Debt Security shall be conclusiveand binding upon such holder and upon all future holders and owners of suchDebt Security, and of any Debt Security issued in exchange or substitutiontherefor or on registration of transfer thereof, irrespective of whether or notany notation in regard thereto is made upon such Debt Security or any DebtSecurity issued in exchange or substitution therefor.

 

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ARTICLE VIII

SECURITYHOLDERS’MEETINGS

SECTION 8.01  Purposes of Meetings.

A meeting of Securityholders may be called at anytime and from time to time pursuant to the provisions of this Article VIII forany of the following purposes:

(a)           to give any notice to theCompany or to the Trustee, or to give any directions to the Trustee, or toconsent to the waiving of any default hereunder and its consequences, or totake any other action authorized to be taken by Securityholders pursuant to anyof the provisions of Article V;

(b)           to remove theTrustee and nominate a successor trustee pursuant to the provisions of ArticleVI;

(c)**          **to consent tothe execution of an indenture or indentures supplemental hereto pursuant to theprovisions of Section 9.02; or

(d)           to take any other actionauthorized to be taken by or on behalf of the holders of any specifiedaggregate principal amount of such Debt Securities under any other provision ofthis Indenture or under applicable law.

SECTION 8.02  Call of Meetings by Trustee.

The Trustee may at any timecall a meeting of Securityholders to take any action specified in Section 8.01,to be held at such time and at such place in New York or Wilmington, Delaware,as the Trustee shall determine. Notice of every meeting of the Securityholders,setting forth the time and the place of such meeting and in general terms theaction proposed to be taken at such meeting, shall be mailed to holders of DebtSecurities affected at their addresses as they shall appear on the DebtSecurities Register. Such notice shall be mailed not less than 20 nor more than180 days prior to the date fixed for the meeting.

 

 

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SECTION 8.03  Call of Meetings by Company orSecurityholders.

In case at any time the Company pursuant to a BoardResolution, or the holders of at least 10% in aggregate principal amount of theDebt Securities, as the case may be, then outstanding, shall have requested theTrustee to call a meeting of Securityholders, by written request setting forthin reasonable detail the action proposed to be taken at the meeting, and theTrustee shall not have mailed the notice of such meeting within 20 days afterreceipt of such request, then the Company or such Securityholders may determinethe time and the place in Sioux Falls, South Dakota for such meeting and maycall such meeting to take any action authorized in Section 8.01, by mailingnotice thereof as provided in Section 8.02.

SECTION 8.04Qualificationsfor Voting.

To be entitled to vote at any meeting ofSecurityholders a Person shall (a) be a holder of one or more Debt Securitieswith respect to which the meeting is being held or (b) a Person appointed by aninstrument in writing as proxy by a holder of one or more such Debt Securities.The only Persons who shall be entitled to be present or to speak at any meetingof Securityholders shall be the Persons entitled to vote at such meeting andtheir counsel and any representatives of the Trustee and its counsel and anyrepresentatives of the Company and its counsel.

SECTION 8.05  Regulations.

Notwithstanding any otherprovisions of this Indenture, the Trustee may make such reasonable regulationsas it may deem advisable for any meeting of Securityholders, in regard to proofof the holding of Debt Securities and of the appointment of proxies, and inregard to the appointment and duties of inspectors of votes, the submission andexamination of proxies, certificates and other evidence of the right to vote,and such other matters concerning the conduct of the meeting as it shall thinkfit.

The Trustee shall, by aninstrument in writing, appoint a temporary chairman of the meeting, unless themeeting shall have been called by the Company or by Securityholders as providedin Section 8.03, in which case the Company or the Securityholders calling themeeting, 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 electedby majority vote of the meeting.

Subject to the provisions ofSection 7.04, at any meeting each holder of Debt Securities with respect towhich such meeting is being held or proxy therefor shall be entitled to onevote for each $1,000 principal amount of Debt Securities held or represented byhim; provided, however, that no vote shall be cast or counted atany meeting in respect of any Debt Security challenged as not outstanding andruled by the chairman of the meeting to be not outstanding. The chairman of themeeting shall have no right to vote other than by virtue of Debt Securitiesheld by him or instruments in writing as aforesaid duly designating him as thePerson to vote on behalf of other Securityholders. Any meeting of Securityholdersduly called pursuant to the provisions of Section 8.02 or 8.03 may be adjournedfrom time to time by a majority of those present, whether or not constituting aquorum, and the meeting may be held as so adjourned without further notice.

 

 

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SECTION 8.06  Voting.

The vote upon any resolution submitted to anymeeting of holders of Debt Securities with respect to which such meeting isbeing held shall be by written ballots on which shall be subscribed thesignatures of such holders or of their representatives by proxy and the serialnumber or numbers of the Debt Securities held or represented by them. Thepermanent chairman of the meeting shall appoint two inspectors of votes whoshall count all votes cast at the meeting for or against any resolution and whoshall make and file with the secretary of the meeting theirverified written reports in triplicate of all votes cast at the meeting. Arecord in duplicate of the proceedings of each meeting of Securityholders shallbe prepared by the secretary of the meeting and there shall be attached to saidrecord the original reports of the inspectors of votes on any vote by ballottaken thereat and affidavits by one or more Persons having knowledge of the factssetting forth a copy of the notice of the meeting and showing that said noticewas mailed as provided in Section 8.02. The record shall show the serialnumbers of the Debt Securities voting in favor of or against any resolution.The record shall be signed and verified by the affidavits of the permanentchairman and secretary of the meeting and one of the duplicates shall bedelivered to the Company and the other to the Trustee to be preserved by theTrustee, the latter to have attached thereto the ballots voted at the meeting.

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

SECTION 8.07  Quorum; Actions.

The Persons entitled to votea majority in outstanding principal amount of the Debt Securities shall constitutea quorum for a meeting of Securityholders; provided, however,that if any action is to be taken at such meeting with respect to a consent,waiver, request, demand, notice, authorization, direction or other action whichmay be given by the holders of not less than a specified percentage inoutstanding principal amount of the Debt Securities, the Persons holding orrepresenting such specified percentage in outstanding principal amount of theDebt Securities will constitute a quorum. In the absence of a quorum within 30minutes of the time appointed for any such meeting, the meeting shall, ifconvened at the request of Securityholders, be dissolved. In any other case themeeting may be adjourned for a period of not less than 10 days as determined bythe permanent chairman of the meeting prior to the adjournment of such meeting.In the absence of a quorum at any such adjourned meeting, such adjournedmeeting may be further adjourned for a period of not less than 10 days asdetermined by the permanent chairman of the meeting prior to the adjournment ofsuch adjourned meeting. Notice of the reconvening of any adjourned meetingshall be given as provided in Section 8.02, except that such notice need begiven only once not less than five days prior to the date on which the meetingis scheduled to be reconvened. Notice of the reconvening of an adjournedmeeting shall state expressly the percentage, as provided above, of theoutstanding principal amount of the Debt Securities which shall constitute aquorum.

Except as limited by theproviso in the first paragraph of Section 9.02, any resolution presented to ameeting or adjourned meeting duly reconvened at which a quorum is present asaforesaid may be adopted by the affirmative vote of the holders of not lessthan a majority in outstanding principal amount of the Debt Securities; provided,however, that, except as limited by the proviso in the first paragraphof Section 9.02, any resolution with respect to any consent, waiver, request,demand, notice, authorization, direction or other action that this Indentureexpressly provides may be given by the holders of not less than a specifiedpercentage in outstanding principal amount of the Debt Securities may beadopted at a meeting or an adjourned meeting duly reconvened and at which aquorum is present as aforesaid only by the affirmative vote of the holders ofnot less than such specified percentage in outstanding principal amount of theDebt Securities.

 

 

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Any resolution passed ordecision taken at any meeting of holders of Debt Securities duly held inaccordance with this Section shall be binding on all the Securityholders,whether or not present or represented at the meeting.

ARTICLE IX

SUPPLEMENTALINDENTURES

SECTION 9.01  Supplemental Indentures without Consentof Securityholders.

The Company, when authorizedby a Board Resolution, and the Trustee may from time to time and at any timeenter into an indenture or indentures supplemental hereto, without the consentof the Securityholders, for one or more of the following purposes:

(a)           to evidence the successionof another corporation to the Company, or successive successions, and theassumption by the successor corporation of the covenants, agreements andobligations of the Company, pursuant to Article XI hereof;

(b)           to add to thecovenants of the Company such further covenants, restrictions or conditions forthe protection of the holders of Debt Securities as the Board of Directorsshall consider to be for the protection of the holders of such Debt Securities,and to make the occurrence, or the occurrence and continuance, of a default inany of such additional covenants, restrictions or conditions a default or anEvent of Default permitting the enforcement of all or any of the severalremedies provided in this Indenture as herein set forth; provided, however,that in respect of any such additional covenant, restriction or condition suchsupplemental indenture may provide for a particular period of grace afterdefault (which period may be shorter or longer than that allowed in the case ofother defaults) or may provide for an immediate enforcement upon such defaultor may limit the remedies available to the Trustee upon such default;

(c)           to cure anyambiguity or to correct or supplement any provision contained herein or in anysupplemental indenture which may be defective or inconsistent with any otherprovision contained herein or in any supplemental indenture, or to make suchother provisions in regard to matters or questions arising under thisIndenture; provided, that any such action shall not adversely affect theinterests of the holders of the Debt Securities;

(d)           to add to, delete from, orrevise the terms of Debt Securities, including, without limitation, any termsrelating to the issuance, exchange, registration or transfer of DebtSecurities, including to provide for transfer procedures and restrictionssubstantially similar to those applicable to the Capital Securities as requiredby Section 2.05 (for purposes of assuring that no registration of DebtSecurities is required under the Securities Act of 1933, as amended); provided,that any such action shall not adversely affect the interests of the holders ofthe Debt Securities then outstanding (it being understood, for purposes of thisproviso, that transfer restrictions on Debt Securities substantially similar tothose that were applicable to Capital Securities shall not be deemed toadversely affect the holders of the Debt Securities);

 

 

 

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(e)           to evidence andprovide for the acceptance of appointment hereunder by a successor Trustee withrespect to the Debt Securities and to add to or change any of the provisions ofthis Indenture as shall be necessary to provide for or facilitate theadministration of the trusts hereunder by more than one Trustee, pursuant tothe requirements of Section 6.10;

(f)            to make anychange (other than as elsewhere provided in this paragraph) that does notadversely affect the rights of any Securityholder in any material respect; or

(g)           to provide forthe issuance of and establish the form and terms and conditions of the DebtSecurities, to establish the form of any certifications required to befurnished pursuant to the terms of this Indenture or the Debt Securities, or toadd to the rights of the holders of Debt Securities.

The Trustee is herebyauthorized to join with the Company in the execution of any such supplementalindenture, to make any further appropriate agreements and stipulations whichmay be therein contained and to accept the conveyance, transfer and assignmentof any property thereunder, but the Trustee shall not be obligated to, but mayin its discretion, enter into any such supplemental indenture which affects theTrustee’s own rights, duties or immunities under this Indenture or otherwise.

Any supplemental indentureauthorized by the provisions of this Section 9.01 may be executed by theCompany and the Trustee without the consent of the holders of any of the DebtSecurities at the time outstanding, notwithstanding any of the provisions ofSection 9.02.

SECTION 9.02  Supplemental Indentures with Consent ofSecurityholders.

With the consent (evidencedas provided in Section 7.01) of the holders of not less than a majority in aggregateprincipal amount of the Debt Securities at the time outstanding affected bysuch supplemental indenture (voting as a class), the Company, when authorizedby a Board Resolution, and the Trustee may from time to time and at any timeenter into an indenture or indentures supplemental hereto (which shall conformto the provisions of the Trust Indenture Act, then in effect, applicable toindentures qualified thereunder) for the purpose of adding any provisions to orchanging in any manner or eliminating any of the provisions of this Indentureor of any supplemental indenture or of modifying in any manner the rights ofthe holders of the Debt Securities; provided, however, that nosuch supplemental indenture shall without such consent of the holders of eachDebt Security then outstanding and affected thereby (i) extend the fixed maturity of any DebtSecurity, or reduce the principal amount thereof or any premium thereon, orreduce the rate or extend the time of payment of interest thereon, or reduceany amount payable on redemption thereof or make the principal thereof or anyinterest or premium thereon payable in any coin or currency other thanthat provided in the Debt Securities, or impair or affect the right of anySecurityholder to institute suit for payment thereof or impair the right ofrepayment, if any, at the option of the holder, or (ii) reduce the aforesaidpercentage of Debt Securities the holders of which are required to consent toany such supplemental indenture; and provided, further, that if theDebt Securities are held by the Trust or a trustee of such trust, suchsupplemental indenture shall not be effective until the holders of a majorityin liquidation preference of Trust Securities shall have consented to suchsupplemental indenture; provided, further, that if the consent of theSecurityholder of each outstanding Debt Security is required, such supplementalindenture shall not be effective until each holder of the Trust Securitiesshall have consented to such supplemental indenture.

 

 

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Upon the request of theCompany accompanied by a Board Resolution authorizing the execution of any suchsupplemental indenture, and upon the filing with the Trustee of evidence of theconsent of Securityholders as aforesaid, the Trustee shall join with theCompany in the execution of such supplemental indenture unless suchsupplemental indenture affects the Trustee’s own rights, duties or immunitiesunder this Indenture or otherwise, in which case the Trustee may in itsdiscretion, but shall not be obligated to, enter into such supplementalindenture.

Promptly after the executionby the Company and the Trustee of any supplemental indenture pursuant to theprovisions of this Section, the Trustee shall transmit by mail, first classpostage prepaid, a notice, prepared by the Company, setting forth in generalterms the substance of such supplemental indenture, to the Securityholdersthereby as their names and addresses appear upon the Debt Security Register.Any failure of the Trustee to mail such notice, or any defect therein, shallnot, however, in any way impair or affect the validity of any such supplementalindenture.

It shall not be necessary for the consent of theSecurityholders under this Section 9.02 to approve the particular form of anyproposed supplemental indenture, but it shall be sufficient if such consentshall approve the substance thereof.

SECTION 9.03  Effect of Supplemental Indentures.

Upon the execution of anysupplemental indenture pursuant to the provisions of this Article IX, thisIndenture shall be and be deemed to be modified and amended in accordancetherewith and the respective rights, limitations of rights, obligations, dutiesand immunities under this Indenture of the Trustee, the Company and the holdersof Debt Securities shall thereafter be determined, exercised and enforcedhereunder subject in all respects to such modifications and amendments and allthe terms and conditions of any such supplemental indenture shall be and bedeemed to be part of the terms and conditions of this Indenture for any and allpurposes.

SECTION 9.04  Notation on Debt Securities.

Debt Securitiesauthenticated and delivered after the execution of any supplemental indenturepursuant to the provisions of this Article IX may bear a notation as to anymatter provided for in such supplemental indenture. If the Company or theTrustee shall so determine, new Debt Securities so modified as to conform, inthe opinion of the Board of Directors of the Company, to any modification ofthis Indenture contained in any such supplemental indenture may be prepared andexecuted by the Company, authenticated by the Trustee or the AuthenticatingAgent and delivered in exchange for the Debt Securities then outstanding.

 

 

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SECTION9.05  Evidence of Compliance ofSupplemental Indenture to be Furnished to Trustee.

 

The Trustee, subject to theprovisions of Sections 6.01 and 6.02, shall, in addition to the documentsrequired by Section 14.06, receive an Officers’ Certificate and an Opinion ofCounsel as conclusive evidence that any supplemental indenture executedpursuant hereto complies with the requirements of this Article IX. The Trusteeshall receive an Opinion of Counsel as conclusive evidence that anysupplemental indenture executed pursuant to this Article IX is authorized orpermitted by, and conforms to, the terms of this Article IX and that it isproper for the Trustee under the provisions of this Article IX to join in theexecution thereof.

ARTICLE X

REDEMPTIONOF SECURITIES

SECTION 10.01  Optional Redemption.

At any time the Companyshall have the right, subject to the receipt by the Company of prior approvalfrom the OTS, if then required under applicable capital guidelines or policiesof the OTS, to redeem the Debt Securities, in whole or in part, on any June 8thor December 8th on or after December 8, 2006 (the “Redemption Date”), at theRedemption Price.

SECTION 10.02  Special Event Redemption.

If a Special Event shalloccur and be continuing, the Company shall have the right, subject to thereceipt by the Company of prior approval from the OTS if then required underapplicable capital guidelines or policies of the OTS, to redeem the DebtSecurities, in whole but not in part, at any time within 90 days following theoccurrence of such Special Event (the “Special Redemption Date”), at theSpecial Redemption Price.

SECTION 10.03  Notice of Redemption; Selection of DebtSecurities.

In case the Company shalldesire to exercise the right to redeem all, or, as the case may be, any part ofthe Debt Securities, it shall fix a date for redemption and shall mail a noticeof such redemption at least 30 and not more than 60 days prior to the datefixed for redemption to the holders of Debt Securities so to be redeemed as awhole or in part at their last addresses as the same appear on the DebtSecurity Register. Such mailing shall be by first class mail. The notice ifmailed in the manner herein provided shall be conclusively presumed to have beenduly given, whether or not the holder receives such notice. In any case,failure to give such notice by mail or any defect in the notice to the holderof any Debt Security designated for redemption as a whole or in part shall notaffect the validity of the proceedings for the redemption of any other DebtSecurity.

 

 

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Each such notice of redemption shall specify theCUSIP number, if any, of the Debt Securities to be redeemed, the date fixed forredemption, the redemption price at which Debt Securities are to be redeemed,the place or places of payment, that payment will be made upon presentation andsurrender of such Debt Securities, that interest accrued to the date fixed forredemption will be paid as specified in said notice, and that on and after saiddate interest thereon or on the portions thereof to be redeemed will cease toaccrue. If less than all the Debt Securities are to be redeemed the notice ofredemption shall specify the numbers of the Debt Securities to be redeemed. Incase the Debt Securities are to be redeemed in part only, the notice ofredemption shall state the portion of the principal amount thereof to beredeemed and shall state that on and after the date fixed for redemption, uponsurrender of such Debt Security, a new Debt Security or Debt Securities inprincipal amount equal to the unredeemed portion thereof will be issued.

Prior to 10:00 a.m. New YorkCity time on the Redemption Date or the Special Redemption Date specified in thenotice of redemption given as provided in this Section, the Company willdeposit with the Trustee or with one or more paying agents an amount of moneysufficient to redeem on the redemption date all the Debt Securities so calledfor redemption at the appropriate redemption price, together with accruedinterest to the date fixed for redemption.

The Company will give theTrustee notice not less than 45 nor more than 60 days prior to the redemptiondate as to the redemption price at which the Debt Securities are to be redeemedand the aggregate principal amount of Debt Securities to be redeemed and theTrustee shall select, in such manner as in its sole discretion it shall deemappropriate and fair, the Debt Securities or portions thereof (in integral multiplesof $1,000) to be redeemed.

SECTION 10.04  Payment of Debt Securities Called forRedemption.

If notice of redemption hasbeen given as provided in Section 10.03, the Debt Securities or portions ofDebt Securities with respect to which such notice has been given shall becomedue and payable on the Redemption Date or the Special Redemption Date (as thecase may be) and at the place or places stated in such notice at the applicableredemption price, together with interest accrued to the date fixed for redemption,and on and after said Redemption Date or the Special Redemption Date (unlessthe Company shall default in the payment of such Debt Securities at theredemption price, together with interest accrued to said date) interest on theDebt Securities or portions of Debt Securities so called for redemption shallcease to accrue. On presentation and surrender of such Debt Securities at aplace of payment specified in said notice, such Debt Securities or thespecified portions thereof shall be paid and redeemed by the Company at theapplicable redemption price, together with interest accrued thereon to theRedemption Date or the Special Redemption Date (as the case may be).

Upon presentation of anyDebt Security redeemed in part only, the Company shall execute and the Trusteeshall authenticate and make available for delivery to the holder thereof, atthe expense of the Company, a new Debt Security or Debt Securities ofauthorized denominations in principal amount equal to the unredeemed portion ofthe Debt Security so presented.

 

 

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ARTICLE XI

CONSOLIDATION,MERGER, SALE, CONVEYANCE AND LEASE

SECTION 11.0l  Company May Consolidate, etc., on CertainTerms.

Nothing contained in thisIndenture or in the Debt Securities shall prevent any consolidation or mergerof the Company with or into any other corporation or corporations (whether ornot affiliated with the Company) or successive consolidations or mergers inwhich the Company or its successor or successors shall be a party or parties,or shall prevent any sale, conveyance, transfer or other disposition of theproperty or capital stock of the Company or its successor or successors as anentirety, or substantially as an entirety, to any other corporation (whether ornot affiliated with the Company, or its successor or successors) authorized toacquire and operate the same; provided, however, that the Companyhereby covenants and agrees that, upon any such consolidation, merger (wherethe Company is not the surviving corporation), sale, conveyance, transfer orother disposition, the due and punctual payment of the principal of (andpremium, if any) and interest on all of the Debt Securities in accordance withtheir terms, according to their tenor, and the due and punctual performance andobservance of all the covenants and conditions of this Indenture to be kept orperformed by the Company, shall be expressly assumed by supplemental indenturesatisfactory in form to the Trustee executed and delivered to the Trustee by theentity formed by such consolidation, or into which the Company shall have beenmerged, or by the entity which shall have acquired such property or capitalstock.

SECTION 11.02  Successor Entity to be Substituted.

In case of any suchconsolidation, merger, sale, conveyance, transfer or other disposition and uponthe assumption by the successor entity, by supplemental indenture, executed anddelivered to the Trustee and satisfactory in form to the Trustee, of the dueand punctual payment of the principal of and premium, if any, and interest onall of the Debt Securities and the due and punctual performance and observanceof all of the covenants and conditions of this Indenture to be performed orobserved by the Company, such successor entity shall succeed to and besubstituted for the Company, with the same effect as if it had been namedherein as the Company, and thereupon the predecessor entity shall be relievedof any further liability or obligation hereunder or upon the Debt Securities.Such successor entity thereupon may cause to be signed, and may issue either inits own name or in the name of the Company, any or all of the Debt Securitiesissuable hereunder which theretofore shall not have been signed by the Companyand delivered to the Trustee or the Authenticating Agent; and, upon the orderof such successor entity instead of the Company and subject to all the terms,conditions and limitations in this Indenture prescribed, the Trustee or theAuthenticating Agent shall authenticate and deliver any Debt Securities whichpreviously shall have been signed and delivered by the officers of the Company,to the Trustee or the Authenticating Agent for authentication, and any DebtSecurities which such successor entity thereafter shall cause to be signed anddelivered to the Trustee or the Authenticating Agent for that purpose. All theDebt Securities so issued shall in all respects have the same legal rank andbenefit under this Indenture as the Debt Securities theretofore or thereafterissued in accordance with the terms of this Indenture as though all of suchDebt Securities had been issued at the date of the execution hereof.

 

 

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SECTION11.03  Opinion of Counsel to beGiven to Trustee.

 

The Trustee, subject to theprovisions of Sections 6.01 and 6.02, shall receive, in addition to the Opinionof Counsel required by Section 9.05, an Opinion of Counsel as conclusiveevidence that any consolidation, merger, sale, conveyance, transfer or otherdisposition, and any assumption, permitted or required by the terms of thisArticle XI complies with the provisions of this Article XI.

ARTICLE XII

SATISFACTIONAND DISCHARGE OF INDENTURE

SECTION 12.01  Discharge of Indenture.

When (a) the Company shalldeliver to the Trustee for cancellation all Debt Securities theretoforeauthenticated (other than any Debt Securities which shall have been destroyed,lost or stolen and which shall have been replaced or paid as provided inSection 2.06) and not theretofore canceled, or (b) all the Debt Securities nottheretofore canceled or delivered to the Trustee for cancellation shall havebecome due and payable, or are by their terms to become due and payable withinone year or are to be called for redemption within one year under arrangementssatisfactory to the Trustee for the giving of notice of redemption, and theCompany shall deposit with the Trustee, in trust, funds, which shall beimmediately due and payable, sufficient to pay at maturity or upon redemptionall of the Debt Securities (other than any Debt Securities which shall havebeen destroyed, lost or stolen and which shall have been replaced or paid asprovided in Section 2.06) not theretofore canceled or delivered to the Trusteefor cancellation, including principal and premium, if any, and interest due orto become due to such date of maturity or redemption date, as the case may be,but excluding, however, the amount of any moneys for the payment of principalof, and premium, if any, or interest on the Debt Securities (1) theretoforerepaid to the Company in accordance with the provisions of Section 12.04, or(2) paid to any state or to the District of Columbia pursuant to its unclaimedproperty or similar laws, and if in the case of either clause (a) or clause (b)the Company shall also pay or cause to be paid all other sums payable hereunderby the Company, then this Indenture shall cease to be of further effect exceptfor the provisions of Sections 2.05, 2.06, 3.01, 3.02, 3.04, 6.06, 6.09 and12.04 hereof, which shall survive until such Debt Securities shall mature orare redeemed, as the case may be, and are paid. Thereafter, Sections 6.06, 6.09and 12.04 shall survive, and the Trustee, on demand of the Company accompaniedby an Officers’ Certificate and an Opinion of Counsel, each stating that allconditions precedent herein provided for relating to the satisfaction anddischarge of this Indenture have been complied with, and at the cost andexpense of the Company, shall execute proper instruments acknowledgingsatisfaction of and discharging this Indenture, the Company, however, herebyagreeing to reimburse the Trustee for any costs or expenses thereafterreasonably and properly incurred by the Trustee in connection with thisIndenture or the Debt Securities.

SECTION 12.02  Deposited Moneys to be Held in Trust byTrustee.

Subject to the provisions ofSection 12.04, all moneys deposited with the Trustee pursuant to Section 12.01shall be held in trust and applied by it to the payment, either directly orthrough any paying agent (including the Company if acting as its own payingagent), to the holders of the particular Debt Securities for the payment ofwhich such moneys have been deposited with the Trustee, of all sums due and tobecome due thereon for principal, and premium, if any, and interest.

 

 

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SECTION12.03  Paying Agent to Repay MoneysHeld.

 

Upon the satisfaction anddischarge of this Indenture, all moneys then held by any paying agent of theDebt Securities (other than the Trustee) shall, upon demand of the Company, berepaid to it or paid to the Trustee, and thereupon such paying agent shall bereleased from all further liability with respect to such moneys.

SECTION 12.04  Return of Unclaimed Moneys.

Any moneys deposited with orpaid to the Trustee or any paying agent for payment of the principal of, andpremium, if any, or interest on Debt Securities and not applied but remainingunclaimed by the holders of Debt Securities for two years after the date uponwhich the principal of, and premium, if any, or interest on such DebtSecurities, as the case may be, shall have become due and payable, shall berepaid to the Company by the Trustee or such paying agent on written demand;and the holder of any of the Debt Securities shall thereafter look only to theCompany for any payment which such holder may be entitled to collect and allliability of the Trustee or such paying agent with respect to such moneys shallthereupon cease.

ARTICLE XIII

IMMUNITY OF INCORPORATORS,STOCKHOLDERS, OFFICERS AND DIRECTORS

SECTION 13.01  Indenture and Debt Securities SolelyCorporate Obligations.

No recourse for the paymentof the principal of or premium, if any, or interest on any Debt Security, orfor any claim based thereon or otherwise in respect thereof, and no recourseunder or upon any obligation, covenant or agreement of the Company in thisIndenture or in any supplemental indenture, or in any such Debt Security, orbecause of the creation of any indebtedness represented thereby, shall be hadagainst any incorporator, stockholder, officer, director, employee or agent, assuch, past, present or future, of the Company or of any successor corporationof the Company, either directly or through the Company or any successorcorporation of the Company, whether by virtue of any constitution, statute orrule of law, or by the enforcement of any assessment or penalty or otherwise;it being expressly understood that all such liability is hereby expresslywaived and released as a condition of, and as a consideration for, theexecution of this Indenture and the issue of the Debt Securities.

 

 

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ARTICLE XIV

MISCELLANEOUS PROVISIONS

SECTION 14.01  Successors.

All the covenants,stipulations, promises and agreements of the Company contained in thisIndenture shall bind its successors and assigns whether so expressed or not.

SECTION 14.02  Official Acts by SuccessorEntity.

Any act or proceeding by anyprovision of this Indenture authorized or required to be done or performed byany board, committee or officer of the Company shall and may be done andperformed with like force and effect by the like board, committee, officer orother authorized Person of any entity that shall at the time be the lawfulsuccessor of the Company.

SECTION 14.03  Surrender of Company Powers.

The Company by instrument inwriting executed by authority of 2/3 (two-thirds) of its Board of Directors anddelivered to the Trustee may surrender any of the powers reserved to theCompany and thereupon such power so surrendered shall terminate both as to theCompany, and as to any permitted successor.

SECTION 14.04  Addresses for Notices, etc.

Any notice or demand whichby any provision of this Indenture is required or permitted to be given or servedby the Trustee or by the Securityholders on the Company may be given or servedin writing by being deposited postage prepaid by registered or certified mailin a post office letter box addressed (until another address is filed by theCompany, with the Trustee for the purpose) to the Company at 225 South MainAvenue, Sioux Falls, South Dakota 57104, Attention: Curtis L. Hage. Any notice,direction, request or demand by any Securityholder or the Company to or uponthe Trustee shall be deemed to have been sufficiently given or made, for allpurposes, if given or made in writing at the office of Wilmington Trust Companyat Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890,Attention: Corporate Trust Administration.

SECTION 14.05  Governing Law.

This Indenture and each DebtSecurity shall be deemed to be a contract made under the law of the State ofNew York, and for all purposes shall be governed by and construed in accordancewith the law of said State, without regard to conflict of laws principlesthereof.

SECTION 14.06  Evidence of Compliance with ConditionsPrecedent.

Upon any application ordemand by the Company to the Trustee to take any action under any of theprovisions of this Indenture, the Company shall furnish to the Trustee anOfficers’ Certificate stating that in the opinion of the signers all conditionsprecedent, if any, provided for in this Indenture relating to the proposedaction have been complied with and an Opinion of Counsel stating that, in theopinion of such counsel, all such conditions precedent have been complied with.

 

 

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Each certificate or opinionprovided for in this Indenture and delivered to the Trustee with respect tocompliance with a condition or covenant provided for in this Indenture (exceptcertificates delivered pursuant to Section 3.05) shall include (a) a statementthat the person making such certificate or opinion has read such covenant orcondition; (b) a brief statement as to the nature and scope of the examinationor investigation upon which the statements or opinions contained in suchcertificate or opinion are based; (c) a statement that, in the opinion of suchperson, he has made such examination or investigation as is necessary to enablehim to express an informed opinion as to whether or not such covenant orcondition has been complied with; and (d) a statement as to whether or not, inthe opinion of such person, such condition or covenant has been complied with.

SECTION 14.07  Non-Business Days.

In any case where the date of payment of interest onor principal of the Debt Securities is not a Business Day, the payment of suchinterest on or principal of the Debt Securities need not be made on such datebut may be made on the next succeeding Business Day, with the same force andeffect as if made on the date of payment and no interest shall accrue for theperiod from and after such date, except if such Business Day is in the nextsucceeding calendar year, such payment will be made on the immediatelypreceding Business Day.

SECTION 14.08  Table of Contents, Headings, etc.

The table of contents and the titles and headings ofthe articles and sections of this Indenture have been inserted for convenienceof reference only, are not to be considered a part hereof, and shall in no waymodify or restrict any of the terms or provisions hereof.

SECTION 14.09  Execution in Counterparts.

This Indenture may be executed in any number ofcounterparts, each of which shall be an original, but such counterparts shalltogether constitute but one and the same instrument.

SECTION 14.10  Separability.

In case any one or more of the provisions containedin this Indenture or in the Debt Securities shall for any reason be held to beinvalid, illegal or unenforceable in any respect, such invalidity, illegalityor unenforceability shall not affect any other provisions of this Indenture orof such Debt Securities, but this Indenture and such Debt Securities shall beconstrued as if such invalid or illegal or unenforceable provision had neverbeen contained herein or therein.

SECTION 14.11  Assignment.

The Company will have theright at all times to assign any of its rights or obligations under thisIndenture to a direct or indirect wholly owned Subsidiary of the Company, provided,that, in the event of any such assignment, the Company will remain liable forall such obligations. Subject to the foregoing, this Indenture is binding uponand inures to the benefit of the parties hereto and their respective successorsand assigns. This Indenture may not otherwise be assigned by the partiesthereto.

 

 

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SECTION 14.12  Acknowledgment of Rights.

The Company acknowledgesthat, with respect to any Debt Securities held by the Trust or theInstitutional Trustee of the Trust, if the Institutional Trustee of the Trustfails to enforce its rights under this Indenture as the holder of DebtSecurities held as the assets of the Trust after the holders of a majority inLiquidation Amount of the Capital Securities of the Trust have so directed inwriting such Institutional Trustee, a holder of record of such CapitalSecurities may to the fullest extent permitted by law institute legalproceedings directly against the Company to enforce such InstitutionalTrustee’s rights under this Indenture without first instituting any legalproceedings against such Institutional Trustee or any other Person.Notwithstanding the foregoing, if an Event of Default has occurred and iscontinuing and such event is attributable to the failure of the Company to payinterest (or premium, if any) or principal on the Debt Securities on the datesuch interest (or premium, if any) or principal is otherwise due and payable(or in the case of redemption, on the redemption date), the Companyacknowledges that a holder of record of Capital Securities of the Trust maydirectly institute a proceeding against the Company for enforcement of paymentto such holder directly of the principal of (or premium, if any) or interest onthe Debt Securities having an aggregate principal amount equal to the aggregateLiquidation Amount of the Capital Securities of such holder on or after therespective due date specified in the Debt Securities.

ARTICLE XV

SUBORDINATIONOF DEBT SECURITIES

SECTION 15.01  Agreement to Subordinate.

The Company covenants and agrees, and each holder ofDebt Securities issued hereunder and under any supplemental indenture (the“Additional Provisions”) by such Securityholder’s acceptance thereof likewisecovenants and agrees, that all Debt Securities shall be issued subject to theprovisions of this Article XV; and each holder of a Debt Security, whether uponoriginal issue or upon transfer or assignment thereof, accepts and agrees to bebound by such provisions.

The payment by the Company of the principal of, andpremium, if any, and interest on all Debt Securities issued hereunder and underany Additional Provisions shall, to the extent and in the manner hereinafterset forth, be subordinated and junior in right of payment to the prior paymentin full of all Senior Indebtedness of the Company, whether outstanding at thedate of this Indenture or thereafter incurred.

No provision of this ArticleXV shall prevent the occurrence of any default or Event ofDefault hereunder.

 

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SECTION 15.02  Default on Senior Indebtedness.

In the event and during thecontinuation of any default by the Company in the payment of principal,premium, interest or any other payment due on any Senior Indebtedness of theCompany following any applicable grace period, or in the event that thematurity of any Senior Indebtedness of the Company has been accelerated becauseof a default, and such acceleration has not been rescinded or canceled and suchSenior Indebtedness has not been paid in full then, in either case, no paymentshall be made by the Company with respect to the principal of, or premium, ifany, or interest on the Debt Securities.

In the event that,notwithstanding the foregoing, any payment shall be received by the Trusteewhen such payment is prohibited by the preceding paragraph of this Section15.02, such payment shall, subject to Section 15.06, be held in trust for thebenefit of, and shall be paid over or delivered to, the holders of SeniorIndebtedness or their respective representatives, or to the trustee or trusteesunder any indenture pursuant to which any of such Senior Indebtedness may havebeen issued, as their respective interests may appear, but only to the extentthat the holders of the Senior Indebtedness (or their representative orrepresentatives or a trustee) notify the Trustee in writing within 90 days ofsuch payment of the amounts then due and owing on the Senior Indebtedness andonly the amounts specified in such notice to the Trustee shall be paid to theholders of Senior Indebtedness.

SECTION 15.03  Liquidation; Dissolution; Bankruptcy.

Upon any payment by theCompany or distribution of assets of the Company of any kind or character,whether in cash, property or securities, to creditors upon any dissolution orwinding-up or liquidation or reorganization of the Company, whether voluntaryor involuntary or in bankruptcy, insolvency, receivership or other proceedings,all amounts due upon all Senior Indebtedness of the Company shall first be paidin full, or payment thereof provided for in money in accordance with its terms,before any payment is made by the Company, on account of the principal (andpremium, if any) or interest on the Debt Securities; and upon any such dissolutionor winding-up or liquidation or reorganization, any payment by the Company, ordistribution of assets of the Company of any kind or character, whether incash, property or securities, to which the Securityholders or the Trustee wouldbe entitled to receive from the Company, except for the provisions of thisArticle XV, shall be paid by the Company, or by any receiver, trustee inbankruptcy, liquidating trustee, agent or other Person making such payment ordistribution, or by the Securityholders or by the Trustee under this Indentureif received by them or it, directly to the holders of Senior Indebtedness ofthe Company (pro rata to such holders on the basis of the respective amounts ofSenior Indebtedness held by such holders, as calculated by the Company) ortheir representative or representatives, or to the trustee or trustees underany indenture pursuant to which any instruments evidencing such SeniorIndebtedness may have been issued, as their respective interests may appear, tothe extent necessary to pay such Senior Indebtedness in full, in money ormoney’s worth, after giving effect to any concurrent payment or distribution toor for the holders of such Senior Indebtedness, before any payment ordistribution is made to the Securityholders.

 

 

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In the event that,notwithstanding the foregoing, any payment or distribution of assets of theCompany of any kind or character, whether in cash, property or securities,prohibited by the foregoing, shall be received by the Trustee before all SeniorIndebtedness of the Company is paid in full, or provision is made for suchpayment in money in accordance with its terms, such payment or distributionshall be held in trust for the benefit of and shall be paid over or deliveredto the holders of such Senior Indebtedness or their representative orrepresentatives, or to the trustee or trustees under any indenture pursuant towhich any instruments evidencing such Senior Indebtedness may have been issued,as their respective interests may appear, as calculated by the Company, forapplication to the payment of all Senior Indebtedness of the Company, remainingunpaid to the extent necessary to pay such Senior Indebtedness in full in moneyin accordance with its terms, after giving effect to any concurrent payment ordistribution to or for the benefit of the holders of such Senior Indebtedness.

 

For purposes of this ArticleXV, the words “cash, property or securities” shall not be deemed to includeshares of stock of the Company as reorganized or readjusted, or securities ofthe Company or any other corporation provided for by a plan of reorganizationor readjustment, the payment of which is subordinated at least to the extentprovided in this Article XV with respect to the Debt Securities to the paymentof all Senior Indebtedness of the Company, that may at the time be outstanding,provided, that (a) such Senior Indebtedness is assumed by the newcorporation, if any, resulting from any such reorganization or readjustment, and(b) the rights of the holders of such Senior Indebtedness are not, without theconsent of such holders, altered by such reorganization or readjustment. Theconsolidation of the Company with, or the merger of the Company into, anothercorporation or the liquidation or dissolution of the Company following theconveyance or transfer of its property as an entirety, or substantially as anentirety, to another corporation upon the terms and conditions provided for inArticle IX of this Indenture shall not be deemed a dissolution, winding-up,liquidation or reorganization for the purposes of this Section 15.03 if suchother corporation shall, as a part of such consolidation, merger, conveyance ortransfer, comply with the conditions stated in Article IX of this Indenture.Nothing in Section 15.02 or in this Section 15.03 shall apply to claims of, orpayments to, the Trustee under or pursuant to Section 6.06 of this Indenture.

SECTION 15.04  Subrogation.

Subject to the payment infull of all Senior Indebtedness of the Company, the Securityholders shall besubrogated to the rights of the holders of such Senior Indebtedness to receivepayments or distributions of cash, property or securities of the Company,applicable to such Senior Indebtedness until the principal of (and premium, ifany) and interest on the Debt Securities shall be paid in full; and, for thepurposes of such subrogation, no payments or distributions to the holders ofsuch Senior Indebtedness of any cash, property or securities to which theSecurityholders or the Trustee would be entitled except for the provisions ofthis Article XV, and no payment over pursuant to the provisions of this ArticleXV to or for the benefit of the holders of such Senior Indebtedness bySecurityholders or the Trustee, shall, as between the Company, its creditorsother than holders of Senior Indebtedness of the Company, and the holders ofthe Debt Securities be deemed to be a payment or distribution by the Company toor on account of such Senior Indebtedness. It is understood that the provisionsof this Article XV are and are intended solely for the purposes of defining therelative rights of the holders of the Debt Securities, on the one hand, and theholders of such Senior Indebtedness, on the other hand.

 

 

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Nothing contained in thisArticle XV or elsewhere in this Indenture, any Additional Provisions or in theDebt Securities is intended to or shall impair, as between the Company, itscreditors other than the holders of Senior Indebtedness of the Company, and theholders of the Debt Securities, the obligation of the Company, which isabsolute and unconditional, to pay to the holders of the Debt Securities theprincipal of (and premium, if any) and interest on the Debt Securities as andwhen the same shall become due and payable in accordance with their terms, oris intended to or shall affect the relative rights of the holders of the DebtSecurities and creditors of the Company, other than the holders of SeniorIndebtedness of the Company, nor shall anything herein or therein prevent theTrustee or the holder of any Debt Security from exercising all remediesotherwise permitted by applicable law upon default under this Indenture,subject to the rights, if any, under this Article XV of the holders of suchSenior Indebtedness in respect of cash, property or securities of the Company,received upon the exercise of any such remedy.

Upon any payment ordistribution of assets of the Company referred to in this Article XV, theTrustee, subject to the provisions of Article VI of this Indenture, and theSecurityholders shall be entitled to conclusively rely upon any order or decreemade by any court of competent jurisdiction in which such dissolution,winding-up, liquidation or reorganization proceedings are pending, or acertificate of the receiver, trustee in bankruptcy, liquidation trustee, agentor other Person making such payment or distribution, delivered to the Trusteeor to the Securityholders, for the purposes of ascertaining the Personsentitled to participate in such distribution, the holders of SeniorIndebtedness and other indebtedness of the Company, the amount thereof orpayable thereon, the amount or amounts paid or distributed thereon and allother facts pertinent thereto or to this Article XV.

SECTION 15.05  Trustee to Effectuate Subordination.

Each Securityholder by suchSecurityholder’s acceptance thereof authorizes and directs the Trustee on suchSecurityholder’s behalf to take such action as may be necessary or appropriateto effectuate the subordination provided in this Article XV and appoints theTrustee such Securityholder’s attorney-in-fact for any and all such purposes.

SECTION 15.06  Notice by the Company.

The Company shall giveprompt written notice to a Responsible Officer of the Trustee at the PrincipalOffice of the Trustee of any fact known to the Company that would prohibit themaking of any payment of monies to or by the Trustee in respect of the DebtSecurities pursuant to the provisions of this Article XV. Notwithstanding theprovisions of this Article XV or any other provision of this Indenture or anyAdditional Provisions, the Trustee shall not be charged with knowledge of theexistence of any facts that would prohibit the making of any payment of monies toor by the Trustee in respect of the Debt Securities pursuant to the provisionsof this Article XV, unless and until a Responsible Officer of the Trustee atthe Principal Office of the Trustee shall have received written notice thereoffrom the Company or a holder or holders of Senior Indebtedness or from anytrustee therefor; and before the receipt of any such written notice, theTrustee, subject to the provisions of Article VI of this Indenture, shall beentitled in all respects to assume that no such facts exist; provided, however,that if the Trustee shall not have received the notice provided for in thisSection 15.06 at least two Business Days prior to the date upon which by theterms hereof any money may become payable for any purpose (including, withoutlimitation, the payment of the principal of (or premium, if any) or interest onany Debt Security), then, anything herein contained to the contrarynotwithstanding, the Trustee shall have full power and authority to receivesuch money and to apply the same to the purposes for which they were received,and shall not be affected by any notice to the contrary that may be received byit within two Business Days prior to such date.

 

 

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The Trustee, subject to theprovisions of Article VI of this Indenture, shall be entitled to conclusivelyrely on the delivery to it of a written notice by a Person representing himselfto be a holder of Senior Indebtedness of the Company (or a trustee orrepresentative on behalf of such holder), to establish that such notice hasbeen given by a holder of such Senior Indebtedness or a trustee orrepresentative on behalf of any such holder or holders. In the event that theTrustee determines in good faith that further evidence is required with respectto the right of any Person as a holder of such Senior Indebtedness toparticipate in any payment or distribution pursuant to this Article XV, theTrustee may request such Person to furnish evidence to the reasonablesatisfaction of the Trustee as to the amount of such Senior Indebtedness heldby such Person, the extent to which such Person is entitled to participate insuch payment or distribution and any other facts pertinent to the rights ofsuch Person under this Article XV, and, if such evidence is not furnished, theTrustee may defer any payment to such Person pending judicial determination asto the right of such Person to receive such payment.

SECTION 15.07  Rights of the Trustee; Holders of SeniorIndebtedness.

The Trustee in its individual capacity shall beentitled to all the rights set forth in this Article XV in respect of anySenior Indebtedness at any time held by it, to the same extent as any otherholder of Senior Indebtedness, and nothing in this Indenture or any AdditionalProvisions shall deprive the Trustee of any of its rights as such holder.

With respect to the holders of Senior Indebtednessof the Company, the Trustee undertakes to perform or to observe only such ofits covenants and obligations as are specifically set forth in this Article XV,and no implied covenants or obligations with respect to the holders of suchSenior Indebtedness shall be read into this Indenture or any AdditionalProvisions against the Trustee. The Trustee shall not owe or be deemed to oweany fiduciary duty to the holders of such Senior Indebtedness and, subject tothe provisions of Article VI of this Indenture, the Trustee shall not be liableto any holder of such Senior Indebtedness if it shall pay over or deliver toSecurityholders, the Company or any other Person money or assets to which anyholder of such Senior Indebtedness shall be entitled by virtue of this ArticleXV or otherwise.

Nothing in this Article XV shall apply to claims of,or payments to, the Trustee under or pursuant to Section 6.06.

SECTION 15.08  Subordination May Not Be Impaired.

No right of any present orfuture holder of any Senior Indebtedness of the Company to enforcesubordination as herein provided shall at any time in any way be prejudiced orimpaired by any act or failure to act on the part of the Company, or by any actor failure to act, in good faith, by any such holder, or by any noncomplianceby the Company, with the terms, provisions and covenants of this Indenture,regardless of any knowledge thereof that any such holder may have or otherwisebe charged with.

 

 

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Without in any way limitingthe generality of the foregoing paragraph, the holders of Senior Indebtednessof the Company may, at any time and from time to time, without the consent ofor notice to the Trustee or the Securityholders, without incurringresponsibility to the Securityholders and without impairing or releasing thesubordination provided in this Article XV or the obligations hereunder of theholders of the Debt Securities to the holders of such Senior Indebtedness, doany one or more of the following: (a) change the manner, place or terms ofpayment or extend the time of payment of, or renew or alter, such SeniorIndebtedness, or otherwise amend or supplement in any manner such SeniorIndebtedness or any instrument evidencing the same or any agreement under whichsuch Senior Indebtedness is outstanding; (b) sell, exchange, release orotherwise deal with any property pledged, mortgaged or otherwise securing suchSenior Indebtedness; (c) release any Person liable in any manner for thecollection of such Senior Indebtedness; and (d) exercise or refrain fromexercising any rights against the Company, and any other Person.

Wilmington Trust Company, inits capacity as Trustee, hereby accepts the trusts in this Indenture declaredand provided, upon the terms and conditions herein above set forth.

 

 

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IN WITNESS WHEREOF, theparties hereto have caused this Indenture to be duly executed by theirrespective officers thereunto duly authorized, as of the day and year firstabove written.

|   | **HF FINANCIAL CORP.**          |
|--------|---------------------------------|
|   |                            |   |
|   |                            |   |
|   | By:                             |  /s/ Curtis L.  Hage |
|   |                            | Curtis L. Hage |
|   |                            | Chairman, President and Chief Executive Officer |
|   |                            |   |
|   |                            |   |
|   |                            |   |
|   | **WILMINGTON TRUST COMPANY,**as |
|   |                            | Trustee |
|   |                            |   |
|   |                            |   |
|   | By:                             |   |
|   |                            | Name: |
|   |                            | Title: |

 

 

----

 

IN WITNESS WHEREOF, theparties hereto have caused this Indenture to be duly executed by theirrespective officers thereunto duly authorized, as of the day and year firstabove written.

|   | **HF FINANCIAL CORP.**          |
|--------|---------------------------------|
|   |                            |   |
|   |                            |   |
|   | By:                             |   |
|   |                            | Curtis L. Hage |
|   |                            | Chairman, President and Chief Executive Officer |
|   |                            |   |
|   |                            |   |
|   |                            |   |
|   | **WILMINGTON TRUST COMPANY,**as |
|   |                            | Trustee |
|   |                            |   |
|   |                            |   |
|   | By:                             |  /s/ Anita Dallago |
|   |                            | Name: Anita Dallago |
|   |                            | Title:  *Financial Services Officer* |

 

 

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**EXHIBIT A**

**FORM OFFLOATING RATE JUNIOR SUBORDINATED DEBT SECURITY DUE 2031**

[FORMOF FACE OF SECURITY]

THIS SECURITY HAS NOT BEENREGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAWS. NEITHERTHIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THEABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOTSUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OFTHIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISETRANSFER SUCH SECURITY ONLY (A) TO THE COMPANY, (B) PURSUANT TO RULE 144A UNDERTHE SECURITIES ACT (“RULE 144A”), TO A PERSON THE HOLDER REASONABLY BELIEVES ISA “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FORITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICEIS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANTTO AN EXEMPTION FROM REGISTRATION TO AN “ACCREDITED INVESTOR” WITHIN THEMEANING OF SUBPARAGRAPH (a) (l), (2) (3) OR (7) OF RULE 501 UNDER THESECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THEACCOUNT OF AN “ACCREDITED INVESTOR,” FOR INVESTMENT PURPOSES AND NOT WITH AVIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATIONOF THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THEREGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S RIGHTPRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) TOREQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHERINFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH THE INDENTURE, A COPY OFWHICH MAY BE OBTAINED FROM THE COMPANY. THE HOLDER OF THIS SECURITY AGREES THATIT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.

THE HOLDER OF THIS SECURITYBY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT ANEMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENTSUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, ASAMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, ASAMENDED (THE “CODE”), (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING ASSETSINCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY AND NOPERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THIS SECURITY ORANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THEEXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITEDTRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-l OR 84-14 OR ANOTHERAPPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOTPROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TOSUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANYINTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDINGTHEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANINGOF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE ISAPPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFITPLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEEBENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOTRESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVEEXEMPTION.

 

 

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IN CONNECTION WITH ANYTRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCHCERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY THE INDENTURE TOCONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

THIS SECURITY WILL BE ISSUEDAND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A PRINCIPAL AMOUNT OF NOT LESSTHAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFEROF THIS SECURITY IN A BLOCK HAVING A PRINCIPAL AMOUNT OF LESS THAN $100,000SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCHPURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SECURITY FORANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ONTHIS SECURITY, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NOINTEREST WHATSOEVER IN THIS SECURITY.

THIS OBLIGATION IS NOT ADEPOSIT AND IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THEUNITED STATES, INCLUDING THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE“FDIC”). THIS OBLIGATION IS SUBORDINATED TO THE CLAIMS OF DEPOSITORS AND THECLAIMS OF GENERAL AND SECURED CREDITORS OF THE COMPANY, IS INELIGIBLE AS COLLATERALFOR A LOAN BY THE COMPANY OR ANY OF ITS SUBSIDIARIES AND IS NOT SECURED.

 

 

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FloatingRate Junior Subordinated Debt Security due 2031

 

of

 

HFFINANCIAL CORP.

 

HFFINANCIAL CORP., a [STATE OF INCORPORATION] corporation (the “Company”), forvalue received promises to pay to _________________ (the “Holder”) orregistered assigns, the principal sum of [____________] Dollars ($_________) onDecember 8, 2031, and to pay interest on said principal sum from November 28,2001, or from the most recent interest payment date (each such date, an“Interest Payment Date”) to which interest has been paid or duly provided for,semi-annually (subject to deferral as set forth herein) in arrears on June 8thand December 8th of each year commencing June 8, 2002, at a variable per annumrate equal to LIBOR (as defined in the Indenture) plus 3.75% (the “InterestRate”) (provided, that the applicable Interest Rate may not exceed 11.0%through the Interest Payment Date in December, 2006) until the principal hereofshall have become due and payable, and on any overdue principal and (withoutduplication and to the extent that payment of such interest is enforceableunder applicable law) on any overdue installment of interest at an annual rateequal to the Interest Rate in effect for each such Extension Period compoundedsemi-annually. The amount of interest payable on any Interest Payment Dateshall be computed on the basis of a 360-day year and the actual number of dayselapsed in the relevant interest period. In the event that any date on whichthe principal or interest is payable on this Debt Security is not a BusinessDay, then payment payable on such date will be made on the next succeeding daythat is a Business Day (and without any interest or other payment in respect ofany such delay), except that, if such Business Day is in the next succeedingcalendar year, such payment shall be made on the immediately preceding BusinessDay, in each case with the same force and effect as if made on such date. Theinterest installment so payable, and punctually paid or duly provided for, onany Interest Payment Date will, as provided in the Indenture, be paid to thePerson in whose name this Debt Security (or one or more Predecessor Securities,as defined in said Indenture) is registered at the close of business on theregular record date for such interest installment, except that interest and anyDeferred Interest payable on the Maturity Date shall be paid to the Person towhom principal is paid. Any such interest installment not punctually paid orduly provided for shall forthwith cease to be payable to the registered holderson such regular record date and may be paid to the Person in whose name thisDebt Security (or one or more Predecessor Debt Securities) is registered at theclose of business on a special record date to be fixed by the Trustee for thepayment of such defaulted interest, notice whereof shall be given to theregistered holders of the Debt Securities not less than 10 days prior to suchspecial record date, all as more fully provided in the Indenture. The principalof and interest on this Debt Security shall be payable at the office or agencyof the Trustee (or other paying agent appointed by the Company) maintained forthat purpose in any coin or currency of the United States of America that atthe time of payment is legal tender for payment of public and private debts; provided,however, that payment of interest may be made at the option of theCompany by check mailed to the registered holder at such address as shallappear in the Debt Security Register or by wire transfer to an accountappropriately designated by the holder hereof. Notwithstanding the foregoing,so long as the holder of this Debt Security is the Institutional Trustee, thepayment of the principal of and interest on this Debt Security will be made inimmediately available funds at such place and to such account as may bedesignated by the Trustee.

 

 

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So long as no Event ofDefault has occurred and is continuing, the Company shall have the right, fromtime to time, to defer payments of interest on the Debt Securities by extendingthe interest payment period on the Debt Securities at any time and from time totime during the term of the Debt Securities, for up to 10 consecutivesemi-annual periods (each such extended interest payment period, an “ExtensionPeriod”), during which Extension Period no interest shall be due and payable(except any Additional Interest that may be due and payable). During anyExtension Period, interest will continue to accrue on the Debt Securities, andinterest on such accrued interest (such accrued interest and interest thereonreferred to herein as “Deferred Interest”) will accrue at the Interest Rate,compounded semi-annually from the date such Deferred Interest would have beenpayable were it not for the Extension Period, both to the extent permitted bylaw. No Extension Period may end on a date other than an Interest Payment Date.At the end of any such Extension Period the Company shall pay all DeferredInterest then accrued and unpaid on the Debt Securities; provided,however, that no Extension Period may extend beyond the Maturity Date and provided,further,  however, duringany such Extension Period, the Company may not (i) declare or pay any dividendsor distributions on, or redeem, purchase, acquire, or make a liquidationpayment with respect to, any of the Company’s capital stock or (ii) make anypayment of principal of or interest or premium, if any, on or repay, repurchaseor redeem any debt securities of the Company that rank *pari passu*in all respects with or juniorin interest to the Debt Securities (other than (a) repurchases, redemptions orother acquisitions of shares of capital stock of the Company (I) in connectionwith any employment contract, benefit plan or other similar arrangement with orfor the benefit of one or more employees, officers, directors or consultants,(II) in connection with a dividend reinvestment or stockholder stock purchaseplan or (III) in connection with the issuance of capital stock of the Company(or securities convertible into or exercisable for such capital stock), asconsideration in an acquisition transaction entered into prior to theapplicable Extension Period, (b) as a result of any exchange or conversion ofany class or series of the Company’s capital stock (or any capital stock of asubsidiary of the Company) for any class or series of the Company’s capitalstock or of any class or series of the Company’s indebtedness for any class orseries of the Company’s capital stock, (c) the purchase of fractional interestsin shares of the Company’s capital stock pursuant to the conversion or exchangeprovisions of such capital stock or the security being converted or exchanged,(d) any declaration of a dividend in connection with any stockholder’s rightsplan, or the issuance of rights, stock or other property under anystockholder’s rights plan, or the redemption or repurchase of rights pursuantthereto, or (e) any dividend in the form of stock, warrants, options or otherrights where the dividend stock or the stock issuable upon exercise of suchwarrants, options or other rights is the same stock as that on which thedividend is being paid or ranks *pari passu*withor junior to such stock). Prior to the termination of any Extension Period, theCompany may further extend such period, provided, that such periodtogether with all such previous and further consecutive extensions thereofshall not exceed 10 consecutive semi-annual periods, or extend beyond theMaturity Date. Upon the termination of any Extension Period and upon thepayment of all Deferred Interest, the Company may commence a new ExtensionPeriod, subject to the foregoing requirements. No interest or Deferred Interestshall be due and payable during an Extension Period, except at the end thereof,but each installment of interest that would otherwise have been due and payableduring such Extension Period shall bear Deferred Interest. The Company mustgive the Trustee notice of its election to begin such Extension Period at leastone Business Day prior to the earlier of (i) the date interest on the DebtSecurities would have been payable except for the election to begin such ExtensionPeriod or (ii) the date such interest is payable, but in any event not laterthan the related regular record date.

 

 

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The indebtedness evidenced by this Debt Security is,to the extent provided in the Indenture, subordinate and junior in right ofpayment to the prior payment in full of all Senior Indebtedness, and this DebtSecurity is issued subject to the provisions of the Indenture with respectthereto. Each holder of this Debt Security, by accepting the same, (a) agreesto and shall be bound by such provisions, (b) authorizes and directs theTrustee on such holder’s behalf to take such action as may be necessary orappropriate to acknowledge or effectuate the subordination so provided and (c)appoints the Trustee such holder’s attorney-in-fact for any and all suchpurposes. Each holder hereof, by such holder’s acceptance hereof, hereby waivesall notice of the acceptance of the subordination provisions contained hereinand in the Indenture by each holder of Senior Indebtedness, whether nowoutstanding or hereafter incurred, and waives reliance by each such holder uponsaid provisions.

The Company waives demand, presentment for payment,notice of nonpayment, notice of protest, and all other notices.

This Debt Security shall not be entitled to anybenefit under the Indenture hereinafter referred to, be valid or becomeobligatory for any purpose until the certificate of authentication hereon shallhave been signed by or on behalf of the Trustee.

The provisions of this DebtSecurity are continued on the reverse side hereof and such continued provisionsshall for all purposes have the same effect as though fully set forth at thisplace.

 

 

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INWITNESS WHEREOF, the Company has duly executed this certificate.

 

|   |   | HF FINANCIAL CORP. |
|--------|--------|--------------------|
|   |   |               |   |
|   |   |               |   |
|   |   | By:                |   |
|   |   |               | Name: |
|   |   |               | Title: |

 

 

 

Dated: ____________________

CERTIFICATE OF AUTHENTICATION

This is one of the Debt Securities referred to in the within-mentionedIndenture.

 

 

|   |   | WILMINGTON TRUST COMPANY, not in its individual capacity but solely  as the Trustee |
|--------|--------|-------------------------------------------------------------------------------------|
|   |   |                                                                                |   |
|   |   |                                                                                |   |
|   |   | By:                                                                                 |   |
|   |   |                                                                                | Authorized Officer |
|   |   |                                                                                |   |

 

 

Dated: ____________________

 

 

A-1-6

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[FORMOF REVERSE OF SECURITY]

This Debt Security is one of a duly authorizedseries of Debt Securities of the Company, all issued or to be issued pursuantto an Indenture (the “Indenture”) dated as of November 28, 2001, duly executedand delivered between the Company and Wilmington Trust Company, as Trustee (the“Trustee”), to which Indenture and all indentures supplemental theretoreference is hereby made for a description of the rights, limitations ofrights, obligations, duties and immunities thereunder of the Trustee, theCompany and the holders of the Debt Securities (referred to herein as the “DebtSecurities”) of which this Debt Security is a part. The summary of the terms ofthis Debt Security contained herein does not purport to be complete and isqualified by reference to the Indenture.

Upon the occurrence and continuation of a Tax Event,an Investment Company Event or a Capital Treatment Event, this Debt Securitymay become due and payable, in whole but not in part, at any time, within 90days following the occurrence of such Tax Event, Investment Company Event orCapital Treatment Event (the “Special Redemption Date”), as the case may be, atthe Special Redemption Price. The Company shall also have the right to redeemthis Debt Security at the option of the Company, in whole or in part, on anyJune 8th or December 8th on or after December 8, 2006 (a “Redemption Date”), atthe Redemption Price.

Any redemption pursuant tothe preceding paragraph will be made, subject to the receipt by the Company ofprior approval from the Office of Thrift Supervision (the “OTS”) if thenrequired under applicable capital guidelines or policies of the OTS, upon notless than 30 days’ nor more than 60 days’ notice. If the Debt Securities areonly partially redeemed by the Company, the Debt Securities will be redeemedpro rata or by lot or by any other method utilized by the Trustee.

“Redemption Price” means100% of the principal amount of the Debt Securities being redeemed plus accruedand unpaid interest on such Debt Securities to the Redemption Date, or, in thecase of a redemption due to the occurrence of a Special Event, to the SpecialRedemption Date if such Special Redemption Date is on or after December 8,2006.

“Special Redemption Price”means (1) if the Special Redemption Date is before December 8, 2006, thegreater of (a) 100% of the principal amount of the Debt Securities beingredeemed pursuant to Section 10.02 of the Indenture or (b) as determined by aQuotation Agent, the sum of the present values of the principal amount payableas part of the Redemption Price with respect to a redemption as of December 8,2006, together with the present value of interest payments calculated at afixed per annum rate of interest equal to 9.95% over the Remaining Life of suchDebt Securities, discounted to the Special Redemption Date on a semi-annualbasis (assuming a 360-day year consisting of twelve 30-day months) at theTreasury Rate plus 0.50%, plus, in the case of either (a) or (b), accrued andunpaid interest on such Debt Securities to the Special Redemption Date and (2)if the Special Redemption Date is on or after December 8, 2006, the RedemptionPrice for such Special Redemption Date.

“Comparable Treasury Issue”means with respect to any Special Redemption Date the United States Treasurysecurity selected by the Quotation Agent as having a maturity comparable to theRemaining Life that would be utilized, at the time of selection and inaccordance with customary financial practice, in pricing new issues ofcorporate debt securities of comparable maturity to the Remaining Life. If noUnited States Treasury security has a maturity which is within a period fromthree months before to three months after December 8, 2006, the two mostclosely corresponding United States Treasury securities shall be used as theComparable Treasury Issue, and the Treasury Rate shall be interpolated orextrapolated on a straight-line basis, rounding to the nearest month using suchsecurities.

 

 

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“Comparable Treasury Price” means (a) the average offive Reference Treasury Dealer Quotations for such Special Redemption Date,after excluding the highest and lowest such Reference Treasury DealerQuotations, or (b) if the Trustee receives fewer than five such ReferenceTreasury Dealer Quotations, the average of all such Quotations.

“Primary Treasury Dealer” shall mean a primaryUnited States Government securities dealer in New York City.

“Quotation Agent” means Salomon Smith Barney Inc.and its successors; provided, however, that if the foregoing shall cease to bea Primary Treasury Dealer, the Company shall substitute therefor anotherPrimary Treasury Dealer.

“Reference Treasury Dealer”means (i) the Quotation Agent and (ii) any other Primary Treasury Dealerselected by the Trustee after consultation with the Company.

“Reference Treasury DealerQuotations” means, with respect to each Reference Treasury Dealer and anySpecial Redemption Date, the average, as determined by the Quotation Agent, ofthe bid and asked prices for the Comparable Treasury Issue (expressed in eachcase as a percentage of its principal amount) quoted in writing to the Trusteeby such Reference Treasury Dealer at 5:00 p.m., New York City time, on thethird Business Day preceding such Special Redemption Date.

“Treasury Rate” means (i)the yield, under the heading which represents the average for the weekimmediately prior to the date of calculation, appearing in the most recentlypublished statistical release designated H.15 (519) or any successorpublication which is published weekly by the Federal Reserve and whichestablishes yields on actively traded United States Treasury securitiesadjusted to constant maturity under the caption “Treasury Constant Maturities”,for the maturity corresponding to the Remaining Life (if no maturity is withinthree months before or after the Remaining Life, yields for the two publishedmaturities most closely corresponding to the Remaining Life shall be determinedand the Treasury Rate shall be interpolated or extrapolated from such yields ona straight-line basis, rounding to the nearest month) or (ii) if such release(or any successor release) is not published during the week preceding thecalculation date or does not contain such yields, the rate per annum equal tothe semi-annual equivalent yield to maturity of the Comparable Treasury Issue,calculated using a price for the Comparable Treasury Issue (expressed as apercentage of its principal amount) equal to the Comparable Treasury Price forsuch Special Redemption Date. The Treasury Rate shall be calculated on thethird Business Day preceding the Special Redemption Date.

 

 

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In the event of redemption of this Debt Security inpart only, a new Debt Security or Debt Securities for the unredeemed portionhereof will be issued in the name of the holder hereof upon the cancellationhereof.

In case an Event of Default, as defined in theIndenture, shall have occurred and be continuing, the principal of all of theDebt Securities may be declared due and payable, and upon such declaration ofacceleration shall become due and payable, in the manner, with the effect andsubject to the conditions provided in the Indenture.

The Indenture containsprovisions permitting the Company and the Trustee, with the consent of theholders of not less than a majority in aggregate principal amount of the DebtSecurities at the time outstanding affected thereby, as specified in theIndenture, to execute supplemental indentures for the purpose of adding anyprovisions to or changing in any manner or eliminating any of the provisions ofthe Indenture or of any supplemental indenture or of modifying in any mannerthe rights of the holders of the Debt Securities; provided, however,that no such supplemental indenture shall, among other things, without theconsent of the holders of each Debt Security then outstanding and affectedthereby (i) extend the fixed maturity of the Debt Securities, or reduce theprincipal amount thereof or any redemption premium thereon, or reduce the rateor extend the time of payment of interest thereon, or make the principal of, orany interest or premium on, the Debt Securities payable in any coin or currencyother than that provided in the Debt Securities, or impair or affect the rightof any holder of Debt Securities to institute suit for the payment thereof, or(ii) reduce the aforesaid percentage of Debt Securities, the holders of whichare required to consent to any such supplemental indenture. The Indenture alsocontains provisions permitting the holders of a majority in aggregate principalamount of the Debt Securities at the time outstanding, on behalf of all of theholders of the Debt Securities, to waive any past default in the performance ofany of the covenants contained in the Indenture, or established pursuant to theIndenture, and its consequences, except a default in the payment of theprincipal of or premium, if any, or interest on any of the Debt Securities. Anysuch consent or waiver by the registered holder of this Debt Security (unlessrevoked as provided in the Indenture) shall be conclusive and binding upon suchholder and upon all future holders and owners of this Debt Security and of anyDebt Security issued in exchange herefor or in place hereof (whether by registrationof transfer or otherwise), irrespective of whether or not any notation of suchconsent or waiver is made upon this Debt Security.

No reference herein to theIndenture and no provision of this Debt Security or of the Indenture shallalter or impair the obligation of the Company, which is absolute andunconditional, to pay the principal of and premium, if any, and interest onthis Debt Security at the time and place and at the rate and in the moneyherein prescribed.

As provided in the Indentureand subject to certain limitations herein and therein set forth, this DebtSecurity is transferable by the registered holder hereof on the Debt SecurityRegister of the Company, upon surrender of this Debt Security for registrationof transfer at the office or agency of the Trustee in Wilmington, Delawareaccompanied by a written instrument or instruments of transfer in formsatisfactory to the Company or the Trustee duly executed by the registeredholder hereof or such holder’s attorney duly authorized in writing, andthereupon one or more new Debt Securities of authorized denominations and forthe same aggregate principal amount will be issued to the designated transfereeor transferees. No service charge will be made for any such registration oftransfer, but the Company may require payment of a sum sufficient to cover anytax or other governmental charge payable in relation thereto.

 

 

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Prior to due presentment for registration oftransfer of this Debt Security, the Company, the Trustee, any AuthenticatingAgent, any paying agent, any transfer agent and the Debt Security registrar maydeem and treat the registered holder hereof as the absolute owner hereof(whether or not this Debt Security shall be overdue and notwithstanding anynotice of ownership or writing hereon) for the purpose of receiving payment ofor on account of the principal hereof and interest due hereon and for all otherpurposes, and neither the Company nor the Trustee nor any Authenticating Agentnor any paying agent nor any transfer agent nor any Debt Security registrarshall be affected by any notice to the contrary.

No recourse shall be had for the payment of theprincipal of or the interest on this Debt Security, or for any claim basedhereon, or otherwise in respect hereof, or based on or in respect of theIndenture, against any incorporator, stockholder, officer or director, past,present or future, as such, of the Company or of any predecessor or successorcorporation, whether by virtue of any constitution, statute or rule of law, orby the enforcement of any assessment or penalty or otherwise, all suchliability being, by the acceptance hereof and as part of the consideration forthe issuance hereof, expressly waived and released.

The Debt Securities are issuable only in registeredcertificated form without coupons. As provided in the Indenture and subject tocertain limitations herein and therein set forth, Debt Securities areexchangeable for a like aggregate principal amount of Debt Securities of adifferent authorized denomination, as requested by the holder surrendering thesame.

All terms used in this DebtSecurity that are defined in the Indenture shall have the meanings assigned tothem in the Indenture.

THE LAW OF THE STATE OF NEWYORK SHALL GOVERN THE INDENTURE AND THE DEBT SECURITIES, WITHOUT REGARD TOCONFLICT OF LAWS PRINCIPLES THEREOF.

 

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