EXHIBIT 4.13


 




 





 


ARCH CAPITAL GROUP (U.S.) INC.,

as Issuer,


 


ARCH CAPITAL GROUP LTD.,

as Guarantor,


 


and



 [NAME OF TRUSTEE],



as Trustee


 






 


INDENTURE



Dated as of          , 200


 






 


Subordinated Debt Securities


 




 





 

















 


CROSS-REFERENCE TABLE


 


Reconciliation and tie between Trust
Indenture Act of 1939 and Indenture, dated as of [   ], [      ].


 


	
  TIA

  	
   

  	
   

  	
  Indenture

  
	
  Section

  	
   

  	
   

  	
  Section

  
	
  § 310(a) 

  	
   

  	
   

  	
  609

  
	
  (b)

  	
   

  	
   

  	
  608,610

  
	
  (c)

  	
   

  	
   

  	
  Not
  Applicable

  
	
  § 311(a)

  	
   

  	
   

  	
  613

  
	
  (b)

  	
   

  	
   

  	
  613

  
	
  (c)

  	
   

  	
   

  	
  Not
  Applicable

  
	
  § 312(a) 

  	
   

  	
   

  	
  701,702

  
	
  (b)

  	
   

  	
   

  	
  705

  
	
  (c)

  	
   

  	
   

  	
  705

  
	
  § 313(a) 

  	
   

  	
   

  	
  703(a)

  
	
  (b)

  	
   

  	
   

  	
  703(b)

  
	
  (c)

  	
   

  	
   

  	
  703(b)

  
	
  (d)

  	
   

  	
   

  	
  703(b) and
  (c)

  
	
  § 314(a)

  	
   

  	
   

  	
   704

  
	
  (b)

  	
   

  	
   

  	
  Not
  Applicable

  
	
  (c)

  	
   

  	
   

  	
  102

  
	
  (d)

  	
   

  	
   

  	
  Not
  Applicable

  
	
  (e)

  	
   

  	
   

  	
  102

  
	
  (f)

  	
   

  	
   

  	
  Not
  Applicable

  
	
  § 315(a) 

  	
   

  	
   

  	
  601, 603

  
	
  (b)

  	
   

  	
   

  	
  602, 703(b)

  
	
  (c)

  	
   

  	
   

  	
  601(b)

  
	
  (d)

  	
   

  	
   

  	
  601(c)

  
	
  (e)

  	
   

  	
   

  	
  514

  
	
  § 316(a) 

  	
  (1)

  	
   

  	
  512,513

  
	
  (b)

  	
   

  	
   

  	
  508

  
	
  (c)

  	
   

  	
   

  	
  104(d)

  
	
  § 317(a) 

  	
  (1)

  	
   

  	
  503

  
	
  (a)

  	
  (2)

  	
   

  	
  504

  
	
  (b)

  	
   

  	
   

  	
  1003

  
	
  § 318(a) 

  	
   

  	
   

  	
  107

  



 


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


 


i

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE ONE

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS AND OTHER PROVISIONS

  OF GENERAL APPLICATION

  
	
   

  	
   

  	
   

  
	
  SECTION 101.

  	
  Definitions

  	
  1

  
	
  SECTION 102.

  	
  Compliance Certificates and Opinions

  	
  8

  
	
  SECTION 103.

  	
  Form of Documents Delivered to Trustee

  	
  9

  
	
  SECTION 104.

  	
  Acts of Holders

  	
  9

  
	
  SECTION 105.

  	
  Notices, Etc., to Trustee and Company

  	
  10

  
	
  SECTION 106.

  	
  Notice to Holders; Waiver

  	
  10

  
	
  SECTION 107.

  	
  Conflict with Trust Indenture Act

  	
  11

  
	
  SECTION 108.

  	
  Effect of Headings and Table of Contents

  	
  11

  
	
  SECTION 109.

  	
  Successors and Assigns

  	
  11

  
	
  SECTION 110.

  	
  Severability Clause

  	
  11

  
	
  SECTION 111.

  	
  Benefits of Indenture

  	
  11

  
	
  SECTION 112.

  	
  GOVERNING LAW

  	
  11

  
	
  SECTION 113.

  	
  Legal Holidays

  	
  11

  
	
  SECTION 114.

  	
  References to Currency

  	
  11

  
	
  SECTION 115.

  	
  Agent for Service; Submission to
  Jurisdiction; Waiver of Immunities

  	
  12

  
	
  SECTION 116.

  	
  Judgment Currency

  	
  12

  



 


ARTICLE TWO


 


SECURITY FORMS


 


	
  SECTION 201.

  	
  Forms Generally

  	
  13

  
	
  SECTION 202.

  	
  Form of Trustee’s Certificate of
  Authentication

  	
  13

  
	
  SECTION 203.

  	
  Securities Issuable in the Form of a
  Global Security

  	
  13

  
	
  SECTION 204.

  	
  Form of Guarantee

  	
  15

  



 


ARTICLE THREE


 


THE SECURITIES


 


	
  SECTION 301.

  	
  Amount Unlimited; Issuable in Series

  	
  16

  
	
  SECTION 302.

  	
  Denominations

  	
  18

  
	
  SECTION 303.

  	
  Execution, Authentication, Delivery and
  Dating

  	
  18

  
	
  SECTION 304.

  	
  Temporary Securities

  	
  19

  
	
  SECTION 305.

  	
  Registration; Registration of Transfer and
  Exchange

  	
  19

  
	
  SECTION 306.

  	
  Mutilated, Destroyed, Lost and Stolen
  Securities

  	
  20

  
	
  SECTION 307.

  	
  Payment of Interest; Interest Rights
  Preserved

  	
  21

  
	
  SECTION 308.

  	
  Persons Deemed Owners

  	
  22

  
	
  SECTION 309.

  	
  Cancellation

  	
  22

  
	
  SECTION 310.

  	
  Computation of Interest

  	
  22

  
	
  SECTION 311.

  	
  CUSIP and ISIN Numbers

  	
  22

  



 


vi

















 


ARTICLE FOUR


 


SATISFACTION AND
DISCHARGE


 


	
  SECTION 401.

  	
  Satisfaction and Discharge of Indenture

  	
  23

  
	
  SECTION 402.

  	
  Application of Trust Funds; Indemnification

  	
  24

  
	
  SECTION 403.

  	
  Defeasance and Discharge of Indenture

  	
  24

  
	
  SECTION 404.

  	
  Defeasance of Certain Obligations

  	
  26

  
	
  SECTION 405.

  	
  Reinstatement

  	
  27

  



 


ARTICLE FIVE


 


REMEDIES


 


	
  SECTION 501.

  	
  Events of Default

  	
  27

  
	
  SECTION 502.

  	
  Acceleration of Maturity; Rescission and
  Annulment

  	
  28

  
	
  SECTION 503.

  	
  Collection of Indebtedness and Suits for
  Enforcement by Trustee

  	
  29

  
	
  SECTION 504.

  	
  Trustee May File Proofs of Claim

  	
  30

  
	
  SECTION 505.

  	
  Trustee May Enforce Claims without
  Possession of Securities

  	
  30

  
	
  SECTION 506.

  	
  Application of Money Collected

  	
  31

  
	
  SECTION 507.

  	
  Limitation on Suits

  	
  31

  
	
  SECTION 508.

  	
  Unconditional Right of Holders to Receive
  Principal, Premium and Interest

  	
  31

  
	
  SECTION 509.

  	
  Restoration of Rights and Remedies

  	
  32

  
	
  SECTION 510.

  	
  Rights and Remedies Cumulative

  	
  32

  
	
  SECTION 511.

  	
  Delay or Omission Not Waiver

  	
  32

  
	
  SECTION 512.

  	
  Control by Holders

  	
  32

  
	
  SECTION 513.

  	
  Waiver of Past Defaults

  	
  32

  
	
  SECTION 514.

  	
  Undertaking for Costs

  	
  33

  
	
  SECTION 515.

  	
  Waiver of Stay or Extension Laws

  	
  33

  



 


ARTICLE SIX


 


THE TRUSTEE


 


	
  SECTION 601.

  	
  Certain Duties and Responsibilities

  	
  33

  
	
  SECTION 602.

  	
  Notice of Defaults

  	
  34

  
	
  SECTION 603.

  	
  Certain Rights of Trustee

  	
  35

  
	
  SECTION 604.

  	
  Not Responsible for Recitals or Issuance of
  Securities

  	
  36

  
	
  SECTION 605.

  	
  May Hold Securities

  	
  36

  
	
  SECTION 606.

  	
  Money Held in Trust

  	
  36

  
	
  SECTION 607.

  	
  Compensation and Reimbursement

  	
  36

  
	
  SECTION 608.

  	
  Disqualification; Conflicting Interests

  	
  37

  
	
  SECTION 609.

  	
  Corporate Trustee Required; Eligibility

  	
  37

  
	
  SECTION 610.

  	
  Resignation and Removal; Appointment of
  Successor

  	
  37

  
	
  SECTION 611.

  	
  Acceptance of Appointment by Successor

  	
  38

  
	
  SECTION 612.

  	
  Merger, Conversion, Consolidation or
  Succession to Business

  	
  39

  
	
  SECTION 613.

  	
  Preferential Collection of Claims Against
  Company

  	
  40

  



 


vii

















 


ARTICLE SEVEN


 


HOLDERS’ LISTS AND
REPORTS BY TRUSTEE AND COMPANY


 


	
  SECTION 701.

  	
  Company to Furnish Trustee Names and
  Addresses of Holders

  	
  40

  
	
  SECTION 702.

  	
  Preservation of Information; Communications
  to Holders

  	
  40

  
	
  SECTION 703.

  	
  Reports by Trustee

  	
  40

  
	
  SECTION 704.

  	
  Reports by Guarantor

  	
  41

  
	
  SECTION 705.

  	
  Communications by Holders with Other
  Holders.

  	
  41

  



 


ARTICLE EIGHT


 


SUCCESSOR CORPORATION


 


	
  SECTION 801.

  	
  When Company or Guarantor May Merge or
  Transfer Assets

  	
  41

  



 


ARTICLE NINE


 


AMENDMENTS &
SUPPLEMENTAL INDENTURES


 


	
  SECTION 901.

  	
  Amendments or Supplemental Indentures
  without Consent of Holders

  	
  42

  
	
  SECTION 902.

  	
  Amendments or Supplemental Indentures with
  Consent of Holders

  	
  43

  
	
  SECTION 903.

  	
  Execution of Supplemental Indentures

  	
  44

  
	
  SECTION 904.

  	
  Effect of Supplemental Indentures

  	
  44

  
	
  SECTION 905.

  	
  Conformity with Trust Indenture Act

  	
  44

  
	
  SECTION 906.

  	
  Reference in Securities to Supplemental
  Indentures

  	
  45

  



 


ARTICLE TEN


 


COVENANTS


 


	
  SECTION 1001.

  	
  Payment of Principal, Premium and Interest

  	
  45

  
	
  SECTION 1002.

  	
  Maintenance of Office or Agency

  	
  45

  
	
  SECTION 1003.

  	
  Money for Securities; Payments to Be Held
  in Trust

  	
  45

  
	
  SECTION 1004.

  	
  Corporate Existence

  	
  47

  
	
  SECTION 1005.

  	
  Statement by Officers as to Default

  	
  47

  
	
  SECTION 1006.

  	
  Waiver of Certain Covenants

  	
  47

  



 


ARTICLE ELEVEN


 


REDEMPTION OF
SECURITIES


 


	
  SECTION 1101.

  	
  Applicability of Article

  	
  47

  
	
  SECTION 1102.

  	
  Election to Redeem; Notice to Trustee

  	
  48

  
	
  SECTION 1103.

  	
  Selection by Trustee of Securities to Be
  Redeemed

  	
  48

  
	
  SECTION 1104.

  	
  Notice of Redemption

  	
  48

  
	
  SECTION 1105.

  	
  Deposit of Redemption Price

  	
  49

  
	
  SECTION 1106.

  	
  Securities Payable on Redemption Date

  	
  49

  
	
  SECTION 1107.

  	
  Securities Redeemed in Part

  	
  50

  



 


viii

















 


ARTICLE TWELVE


 


SINKING FUNDS


 


	
  SECTION 1201.

  	
  Applicability of Article

  	
  50

  
	
  SECTION 1202.

  	
  Satisfaction of Sinking Fund Payments with
  Securities

  	
  50

  
	
  SECTION 1203.

  	
  Redemption of Securities for Sinking Fund

  	
  51

  



 


ARTICLE THIRTEEN


 


GUARANTEE OF
SECURITIES


 


	
  SECTION 1301.

  	
  Unconditional Guarantee

  	
  51

  
	
  SECTION 1302.

  	
  Execution and Delivery of Guarantee

  	
  52

  
	
  SECTION 1303.

  	
  Obligations of the Guarantor Unconditional

  	
  53

  
	
  SECTION 1304.

  	
  Waivers

  	
  55

  
	
  SECTION 1305.

  	
  Amendment, Etc.

  	
  55

  



 


ARTICLE FOURTEEN


 


SUBORDINATION


 


	
  SECTION 1401.

  	
  Agreement to Subordinate

  	
  55

  
	
  SECTION 1402.

  	
  Default on Company Senior Indebtedness

  	
  56

  
	
  SECTION 1403.

  	
  Liquidation; Dissolution; Bankruptcy

  	
  57

  
	
  SECTION 1404.

  	
  Subrogation

  	
  58

  
	
  SECTION 1405.

  	
  Trustee to Effectuate Subordination

  	
  58

  
	
  SECTION 1406.

  	
  Notice by the Company

  	
  59

  
	
  SECTION 1407.

  	
  Rights of the Trustee; Holders of Company Senior
  Indebtedness

  	
  59

  
	
  SECTION 1408.

  	
  Subordination May Not Be Impaired

  	
  60

  
	
  SECTION 1409.

  	
  Article Applicable to Paying Agents

  	
  60

  
	
  SECTION 1410.

  	
  Defeasance of This Article

  	
  60

  
	
  SECTION 1411.

  	
  Subordination Language to Be Included in
  Securities

  	
  60

  



 


ARTICLE FIFTEEN


 


SUBORDINATION OF
GUARANTEE


 


	
  SECTION 1501.

  	
  Agreement to Subordinate

  	
  61

  
	
  SECTION 1502.

  	
  Default on Guarantor Senior Indebtedness

  	
  61

  
	
  SECTION 1503.

  	
  Liquidation; Dissolution; Bankruptcy

  	
  62

  
	
  SECTION 1504.

  	
  Subrogation

  	
  63

  
	
  SECTION 1505.

  	
  Trustee to Effectuate Subordination

  	
  64

  
	
  SECTION 1506.

  	
  Notice by the Guarantor

  	
  64

  
	
  SECTION 1507.

  	
  Rights of the Trustee; Holders of Guarantor
  Senior Indebtedness

  	
  65

  
	
  SECTION 1508.

  	
  Subordination May Not Be Impaired

  	
  65

  
	
  SECTION 1509.

  	
  Article Applicable to Paying Agents

  	
  65

  
	
  SECTION 1510.

  	
  Defeasance of This Article

  	
  66

  
	
  SECTION 1511.

  	
  Subordination Language to Be Included in
  Guarantee

  	
  66

  



 


ix

















 


INDENTURE, dated as of            ,
200 , among Arch Capital Group (U.S.) Inc., a Delaware corporation (herein
called the “Company”),  having
its principal office at 20 Horseneck Lane, Greenwich, CT 20380, Arch Capital
Group Ltd., a Bermuda company (herein called the “Guarantor”)  and [Name of Trustee], as trustee hereunder (herein called
the “Trustee”).


 


RECITALS OF THE COMPANY


 


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


 


All things necessary to make this Indenture a
valid agreement of the Company, in accordance with its terms, have been
done.  The Guarantor, directly or
indirectly, owns beneficially 100% of the issued share capital of the Company.


 


The Guarantor has duly authorized the
execution and delivery of this Indenture to provide for the Guarantee of the
Securities provided for herein.


 


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


 


NOW, THEREFORE, THIS INDENTURE WITNESSETH:


 


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


 


ARTICLE ONE


 


DEFINITIONS AND OTHER PROVISIONS

OF GENERAL APPLICATION


 


SECTION 101.          Definitions.


 


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


 


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


 


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


 


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


 

















 


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


 


(5)           all references used herein to the male gender shall
include the female gender.


 


 “Act,” when used with respect to any Holder, has the meaning
specified in Section 104.


 


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


 


“Applicable
Insurance Regulatory Authority” means, when used with respect to any
Regulated Insurance Company, (x) the insurance department or similar
administrative authority or agency located in each state or jurisdiction
(foreign or domestic) in which such Regulated Insurance Company is domiciled or
(y) to the extent asserting regulatory jurisdiction over such Regulated
Insurance Company, the insurance department, authority or agency in each state
or jurisdiction (foreign or domestic) in which such Regulated Insurance Company
is licensed, and shall include any Federal or national insurance regulatory
department, authority or agency that may be created and that asserts insurance
regulatory jurisdiction over such Regulated Insurance Company.


 


“Arch Capital Common Shares”  means the common shares, $0.01 par value per share, of Arch
Capital Group Ltd. or any other shares of Capital Stock of Arch Capital Group
Ltd. into which such Arch Capital Common Shares shall be reclassified or
changed.


 


“Arch Capital Preference
Shares”  means the
preference shares, $0.01 par value per share, of Arch Capital Group Ltd. or any
other shares of Capital Stock of Arch Capital Group Ltd. into which such Arch
Capital Preference Shares shall be reclassified or changed.


 


“Board of Directors”  means either the board of directors (or the functional
equivalent thereof) of the Company or the Guarantor or any duly authorized
committee of that board duly authorized to act hereunder.


 


“Board Resolution”  means a copy of a resolution, certified by the secretary or
an assistant secretary of the Company or the Guarantor, as the case may be, to
have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, delivered to the Trustee.


 


“Business Day”  means, with respect to any Securities, a day that in the
City of New York or in any Place of Payment is not a day on which banking
institutions are authorized by law or regulation to close.


 


“Capital Stock”  for any Person means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or interests
in (however designated) equity of such Person, including preference shares, but
excluding any debt securities convertible into such equity.


 


“Certificated Securities”  means Securities that are in registered definitive form.


 


2

















 


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


 


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


 


“Company Request”  or “Company Order”  means a written request or order signed in the name of the
Company or the Guarantor, as the case may be, by its chairman of the Board of
Directors, a vice chairman, its president or a vice president, and by its
treasurer, an assistant treasurer, its secretary or an assistant secretary, and
delivered to the Trustee.


 


“Company Senior
Indebtedness,” unless otherwise specified in one or more indentures
supplemental hereto or approved pursuant to a Board Resolution in accordance
with Section 301, means, with respect to the Company, (i) the
principal (including redemption payments), premium, if any, interest and other
payment obligations in respect of (A) indebtedness of the Company for
money borrowed and (B) indebtedness evidenced by securities, debentures,
bonds, notes or other similar instruments issued by the Company, including any
such securities issued under any deed, indenture or other instrument to which
the Company is a party; (ii) all capital lease obligations of the Company;
(iii) all obligations of the Company issued or assumed as the deferred
purchase price of property, all conditional sale obligations of the Company,
all hedging agreements and agreements of a similar nature thereto and all
agreements relating to any such agreements, and all obligations of the Company
under any title retention agreement (but excluding trade accounts payable
arising in the ordinary course of business); (iv) all obligations of the
Company for reimbursement on any letter of credit, banker’s acceptance,
security purchase facility or similar credit transaction; (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 responsible or liable
as obligor, guarantor or otherwise; (vi) all obligations of the type
referred to in clauses (i) through (v) above of other Persons secured
by any lien on any property or asset of the Company (whether or not such
obligation is assumed by the Company); and (vii) any deferrals,
amendments, renewals, extensions, modifications and refundings of all obligations
of the type referred to in clauses (i) through (vi) above, in each
case whether or not contingent and whether outstanding at the date hereof or
thereafter incurred, except,  in
each case, for the Securities and any such other indebtedness or deferral,
amendment, renewal, extension, modification or refunding that contains express
terms, or is issued under a deed, indenture or other instrument that contains
express terms, providing that it is subordinate to or ranks pari passu with the Securities.  Such Senior Indebtedness shall continue to be
Senior Indebtedness and be entitled to the benefits of the subordination
provisions of this Indenture irrespective of any amendment, modification or
waiver of any term of such Senior Indebtedness and notwithstanding that no
express written subordination agreement may have been entered into between the
holders of such Senior Indebtedness and the Trustee or any of the Holders.


 


“Corporate Trust Office”  means the office of the Trustee at which at any particular
time the trust created by this Indenture shall be administered, which office,
at the time of the execution of this Indenture, is located at [        ].


 


“Covenant Defeasance”
has the meaning specified in Section 404.


 


“Defaulted Interest”  has the meaning specified in Section 307.


 


“Depositary”  means, unless otherwise specified by the Company pursuant
to either Section 203 or 301, with respect to Securities of any series
issuable or issued as a Global Security, The Depository 


 


3

















 


Trust Company,
New York, New York, or any successor thereto registered under the Exchange Act
or other applicable statute or regulation.


 


“Event of Default”  has the meaning specified in Section 501.


 


“Exchange Act”  means the United States Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the Commission
thereunder.


 


“Global Security”  means a Security issued to evidence all or a part of any
series of Securities which is executed by the Company and authenticated and
delivered by the Trustee to the Depositary or pursuant to the Depositary’s
instruction, all in accordance with this Indenture and pursuant to a Company
Order, which shall be registered in the name of the Depositary or its nominee.


 


“Guarantee”  means the guarantee by the Guarantor pursuant to Article Thirteen
applicable to any Security which is authenticated and delivered pursuant to
this Indenture, which guarantee is endorsed on such Security by the Guarantor
pursuant to Article Thirteen.


 


“Guarantee Payment Blockage
Notice” has the meaning specified in Section 1502(b).


 


“Guarantee Payment Blockage
Period” has the meaning specified in Section 1502(b).


 


“Guaranteed Obligations”
has the meaning specified in Section 1301.


 


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


 


“Guarantor Senior
Indebtedness,” unless otherwise specified in one or more indentures
supplemental hereto or approved pursuant to a Board Resolution in accordance
with Section 301, means, with respect to the Guarantor, (i) the
principal (including redemption payments), premium, if any, interest and other
payment obligations in respect of (A) indebtedness of the Guarantor for
money borrowed and (B) indebtedness evidenced by securities, debentures,
bonds, notes or other similar instruments issued by the Guarantor, including
any such securities issued under any deed, indenture or other instrument to
which the Guarantor is a party; (ii) all capital lease obligations of the
Guarantor; (iii) all obligations of the Guarantor issued or assumed as the
deferred purchase price of property, all conditional sale obligations of the
Guarantor, all hedging agreements and agreements of a similar nature thereto
and all agreements relating to any such agreements, and all obligations of the
Guarantor under any title retention agreement (but excluding trade accounts
payable arising in the ordinary course of business); (iv) all obligations
of the Guarantor for reimbursement on any letter of credit, banker’s
acceptance, security purchase facility or similar credit transaction; (v) all
obligations of the type referred to in clauses (i) through (iv) above
of other Persons for the payment of which the Guarantor is responsible or
liable as obligor, guarantor or otherwise; (vi) all obligations of the
type referred to in clauses (i) through (v) above of other Persons
secured by any lien on any property or asset of the Guarantor (whether or not
such obligation is assumed by the Guarantor); and (vii) any deferrals,
amendments, renewals, extensions, modifications and refundings of all
obligations of the type referred to in clauses (i) through (vi) above,
in each case whether or not contingent and whether outstanding at the date
hereof or thereafter incurred, except,  in
each case, for the Guarantee and any such other indebtedness or deferral,
amendment, renewal, extension, modification or refunding that contains express
terms, or is issued under a deed, indenture or other instrument that contains
express terms, providing that it is subordinate to or ranks pari passu with the Guarantee.  Such Senior Indebtedness shall continue to be
Senior Indebtedness and be entitled to the benefits of the subordination provisions
of this Indenture irrespective of any amendment, modification or waiver of any
term of such 


 


4

















 


Senior Indebtedness
and notwithstanding that no express written subordination agreement may have
been entered into between the holders of such Senior Indebtedness and the
Trustee or any of the Holders.


 


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


 


“Indenture”  means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more amendments or
indentures supplemental hereto entered into pursuant to the applicable
provisions hereof and shall include the terms of particular series of
Securities established as contemplated by Section 301.


 


“Insurance
Business” means one or more aspects of the business of selling,
issuing, or underwriting insurance or reinsurance.


 


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


 


“Issuer” means
the Company.


 


“Judgment Currency”
has the meaning specified in Section 116.


 


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


 


“Officers’ Certificate”  means a certificate signed by (i) the chairman of the
board, the president, a vice president or a director, and (ii) the
principal financial officer, a vice president, the treasurer, an assistant treasurer,
the secretary or an assistant secretary, of the Company or the Guarantor, as
the case may be, and delivered to the Trustee.


 


“Opinion of Counsel”  means written opinion of counsel, who may be counsel for
the Company and who shall be acceptable to the Trustee.


 


“Original Issue Discount
Security”  means any
Security which provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502.


 


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


 


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


 


(ii)           Securities for whose payment or redemption money or
evidences of indebtedness in the necessary amount has been theretofore
deposited with the Trustee or any Paying Agent (other than the Company or the
Guarantor) in trust or set aside and segregated in trust by the Company or the
Guarantor (if the Company or the Guarantor shall act as its own Paying Agent)
for the Holders of such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made; and


 


5
















 


(iii)          Securities which have been paid pursuant to Section 306
or in exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser in
whose hands such Securities are valid obligations of the Company;


 


provided,
however, that in determining whether the
Holders of the requisite principal amount of the Outstanding Securities have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or the Guarantor or of such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Securities
which the Responsible Officer of the Trustee knows to be so owned shall be so
disregarded.  Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee’s right so to act
with respect to such Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or the
Guarantor or of such other obligor.  In
case of a dispute as to such right, any decision by the Trustee shall be full
protection to the Trustee.  Upon request
of the Trustee, the Company shall furnish to the Trustee promptly an Officers’
Certificate listing and identifying all Securities, if any, known by the
Company to be owned or held by or for the account of any of the above-described
Persons; and, subject to Section 601, the Trustee shall be entitled to
accept such Officers’ Certificate as conclusive evidence of the facts therein
set forth and of the fact that all Securities not listed therein are
Outstanding for the purposes of any such determination.


 


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


 


“Payment Blockage Notice”
has the meaning specified in Section 1402(b).


 


“Payment Blockage Period”
has the meaning specified in Section 1402(b).


 


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


 


“Place of Payment,”
when used with respect to the Securities of any series, means the place or
places where the principal of (and premium, if any) and interest on the
Securities of that series are payable as specified as contemplated by Section 301.


 


“Policies”
means all insurance policies, annuity contracts, guaranteed interest contracts
and funding agreements (including riders to any such policies or contracts,
certificates issued with respect to group life insurance or annuity contracts
and assumption certificates issued or to be issued (or filed pending current
review by applicable governmental authorities)) by any Regulated Insurance
Company and any coinsurance agreements entered into or to be entered into by
any Regulated Insurance Company.


 


“Predecessor Security”  of any particular Security means every previous Security evidencing
all or a portion of the same debt as that evidenced by such particular
Security; and, for the purposes of this definition, any Security authenticated
and delivered under Section 306 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Security shall be deemed to evidence the same debt as
the mutilated, destroyed, lost or stolen Security.


 


6

















 


“Preferred Stock”  means the preferred stock, $0.01 par value per share, of
the Company or any other shares of Capital Stock of the Company into which such
Preferred Stock shall be reclassified or changed.


 


“Process Agent”
has the meaning specified in Section 115.


 


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


 


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


 


“Regular Record Date”  for the interest payable on any Interest Payment Date on
the Securities of any series means the date specified for that purpose as
contemplated by Section 301.


 


“Regulated
Insurance Company” means any Subsidiary of the Company, whether now
owned or hereafter acquired, that is authorized or admitted to carry on or
transact Insurance Business in any jurisdiction (foreign or domestic) and is
regulated by any Applicable Insurance Regulatory Authority.


 


“Responsible Officer,”  when used with respect to the Trustee, means any officer of
the Trustee assigned by the Trustee to administer its corporate trust matters
with respect to this Indenture (which, for the avoidance of doubt, includes
without limitation any supplemental indenture hereto).


 


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


 


“Security Register”  and “Security Registrar”  have the respective meanings specified in Section 305.


 


“Special Record Date”  for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 307.


 


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


 


“Subsidiary”  means, with respect to any Person:


 


(1)           any corporation or company a majority of whose Capital
Stock with voting power, under ordinary circumstances, to elect directors is, at
the date of determination, directly or indirectly, owned by such Person (a “subsidiary”),  by one or more
subsidiaries of such Person or by such Person and one or more subsidiaries of
such Person;


 


(2)           a partnership in which such Person or a subsidiary of such
Person is, at the date of determination, a general partner of such partnership;
or


 


(3)           any partnership, limited liability company or other Person
in which such Person, a subsidiary of such Person or such Person and one or
more subsidiaries of such Person, directly or indirectly, at the date of
determination, have (x) at least a majority ownership interest or (y) the
power to elect or appoint or direct the election or appointment of the managing
partner or member 


 


7

















 


of such Person
or, if applicable, a majority of the directors or other governing body of such
Person.


 


“Trust Indenture Act”  means the Trust Indenture Act of 1939, as amended, and in
force at the date as of which this instrument was executed, except as provided
in Section 905.


 


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


 


“U.S.  Government Obligations”  means
securities which are (i) direct obligations of the United States of
America for the payment of which its full faith and credit is pledged or (ii) obligations
of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of which is unconditionally
guaranteed as to the timely payment of principal and interest as a full faith
and credit obligation by the United States of America, which, in either case,
are not callable or redeemable at the option of the issuer thereof, and shall
also include a depository receipt issued by a bank or trust company which is a
member of the Federal Reserve System and having a combined capital and surplus
of at least $50,000,000 as custodian with respect to any such obligation
evidenced by such depository receipt or a specific payment of interest on or
principal of any such obligation held by such custodian for the account of the
holder of a depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to
the holder of such depository receipt from any amount received by the custodian
in respect of the obligation set forth in (i) or (ii) above or the
specific payment of interest on or principal of such obligation evidenced by
such depository receipt.


 


SECTION 102.          Compliance Certificates
and Opinions.


 


Upon any application or request by the
Company or the Guarantor to the Trustee to take any action under any provision
of this Indenture, the Company or the Guarantor, as the case may be, shall furnish
to the Trustee an Officers’ Certificate stating that all conditions precedent,
if any, provided for in this Indenture relating to the proposed action have
been complied with and, where appropriate as to matters of law, an Opinion of
Counsel stating that in the opinion of such counsel all such conditions precedent,
if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.


 


Every certificate or opinion with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:


 


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


 


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


 


(3)           a statement that, in the opinion of each such Person, such
Person has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such condition or covenant
has been complied with; and


 


8

















 


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


 


SECTION 103.          Form of Documents
Delivered to Trustee.


 


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


 


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


 


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


 


SECTION 104.          Acts of Holders.


 


(a)           Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Trustee and, where it is hereby expressly required, to the
Company or the Guarantor.  Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the “Act” of the Holders signing
such instrument or instruments.  Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section 601)
conclusive in favor of the Trustee and the Company or the Guarantor, if made in
the manner provided in this Section 104.


 


(b)           The fact and date of the execution of any such instrument
or writing, or the authority of the Person executing the same, may be proved in
accordance with such reasonable rules and regulations as may be prescribed
by the Trustee or in any reasonable manner which the Trustee deems sufficient.


 


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


 


(d)           If the Company or the Guarantor shall solicit from the
Holders any request, demand, authorization, direction, notice, consent, waiver
or other Act, the Company or the Guarantor may, at its option, by or pursuant
to a Board Resolution, fix in advance a record date for the determination of
Holders entitled to give such request, demand, authorization, direction,
notice, consent, waiver or other Act, but the Company or the Guarantor shall
have no obligation to do so. 
Notwithstanding Trust Indenture Act Section 316(c), such record
date shall be the record date specified in or pursuant to such Board 


 


9

















 


Resolution, which shall be a date not earlier
than the date 30 days prior to the first solicitation of Holders generally in
connection therewith and not later than the date such solicitation is
completed.  If such a record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act maybe given before or after such record date, but only the Holders
of record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Securities shall be computed as of such record date;
provided, however, that no such authorization, agreement or consent by such
Holders on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than eleven months after
the record date.


 


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


 


SECTION 105.          Notices, Etc., to Trustee
and Company.


 


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


 


(1)           the Trustee by any Holder or by the Company or the
Guarantor shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its Corporate Trust
Office, Attention:   [       ],
or


 


(2)           the Company or the Guarantor by the Trustee or by any
Holder shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
the Company addressed to it at the address of its principal office specified in
the first paragraph of this instrument (or, if to the Guarantor, to Arch
Capital Group Ltd., Wessex House, 45 Reid Street, Hamilton HM 12, Bermuda) or
at any other address previously furnished in writing to the Trustee by the
Company, to the attention of the general counsel of the Company or the
Guarantor.


 


SECTION 106.          Notice to Holders; Waiver.


 


Where this Indenture provides for notice to
Holders of any event, such notice shall be sufficiently given (unless otherwise
herein expressly provided) if in writing and mailed, first-class postage
prepaid, to each Holder affected by such event, at his address as it appears in
the Security Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice.  In any case where notice to Holders is given
by mail, neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders.  Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.


 


In case by reason of the suspension of
regular mail service or by reason of any other case it shall be impracticable
to give such notice by mail, then such notification as shall be made with the approval
of the Trustee shall constitute a sufficient notification for every purpose
hereunder.


 


10

















 


SECTION 107.          Conflict with Trust
Indenture Act.


 


If any provision hereof limits, qualifies or
conflicts with another provision which is required or deemed to be included in
this Indenture by any of the provisions of the Trust Indenture Act, such
required or deemed provision shall control.


 


SECTION 108.          Effect of Headings and
Table of Contents.


 


The article and section headings herein and
the table of contents are for convenience only and shall not affect the construction
hereof.


 


SECTION 109.          Successors and Assigns.


 


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


 


SECTION 110.          Severability Clause.


 


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


 


SECTION 111.          Benefits of Indenture.


 


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


 


SECTION 112.          GOVERNING LAW.


 


THIS INDENTURE AND THE SECURITIES AND THE
GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.


 


SECTION 113.          Legal Holidays.


 


In any case where any Interest Payment Date,
Redemption Date or Stated Maturity of any Security shall not be a Business Day
at any Place of Payment, then (notwithstanding any other provision of this
Indenture or of the Securities) payment of interest or principal (and premium,
if any) need not be made at such Place of Payment on such date, but may be made
on the next succeeding Business Day at such Place of Payment with the same
force and effect as if made on the Interest Payment Date or Redemption Date, or
at the Stated Maturity, provided that no interest shall accrue on the amount
payable on such date or at such date for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be,
to such next succeeding Business Day.


 


SECTION 114.          References to Currency.


 


All references in this Indenture to “dollars”
or “$” are to the currency of the United States of America.


 


11

















 


SECTION 115.          Agent for Service;
Submission to Jurisdiction; Waiver of Immunities.


 


By the execution and delivery of this
Indenture, the Guarantor (i) acknowledges that it has, by separate written
instrument, designated and appointed [               ]
(the “Process Agent”), [  ],  as
its authorized agent upon which process may be served in any suit, action or
proceeding arising out of or relating to the Guarantee or this Indenture that
may be instituted in any Federal or state court in the State of New York, The
City of New York, the Borough of Manhattan, or brought under Federal or state
securities laws or brought by the Trustee (whether in its individual capacity
or in its capacity as Trustee hereunder), and acknowledges that the Process
Agent has accepted such designation, (ii) submits to the jurisdiction of
any such court in any such suit, action or proceeding and (iii) agrees
that service of process upon the Process Agent and written notice of said
service to it at its principal office in accordance with Section 105
hereof), shall be deemed in every respect effective service of process upon it
in any such suit or proceeding.  The
Guarantor further agrees to take any and all action, including the execution
and filing of any and all such documents and instruments as may be necessary to
continue such designation and appointment of the Process Agent in full force
and effect so long as the Guarantee shall be outstanding; provided that the
Guarantor may (and shall, to the extent the Process Agent ceases to be able to
be served on the basis contemplated herein) by written notice to the Trustee,
designate such additional or alternative agents for service of process under
this Section 115 that (i) maintains an office located in the Borough
of Manhattan, The City of New York in the State of New York, (ii) are
either (x) counsel for the Guarantor or (y) a corporate service
company which acts as agent for service of process for other Persons in the
ordinary course of its business and (iii) agrees to act as agent for
service of process in accordance with this Section 115.  Such notice shall identify the name of such
agent for process and the address of such agent for process in the Borough of
Manhattan, The City of New York, State of New York.  Notwithstanding the foregoing, there shall,
at all times, be at least one agent for service of process for the Guarantor appointed
and acting in accordance with this Section 115.


 


By execution and delivery of this Indenture,
the Company submits to the jurisdiction of any federal or state court in the
State of New York, The City of New York, the Borough of Manhattan, in any suit,
action or proceeding arising out of or relating to the Securities or this
Indenture.


 


To the extent that the Company or the
Guarantor has or hereafter may acquire any immunity from jurisdiction of any
court or from any legal process (whether through service of notice, attachment
prior to judgment, attachment in aid of execution, execution or otherwise) with
respect to itself or its property, it hereby irrevocably waives such immunity
in respect of its obligations under the above-referenced documents, to the
extent permitted by law.


 


SECTION 116.          Judgment Currency.


 


The Guarantor hereby agrees to indemnify the
Trustee and each Holder against any loss incurred by any of them as a result of
any judgment or order being given or made for any amount due under this
Indenture or the Guarantee and such judgment or order being expressed and paid
in a currency (the “Judgment Currency”)  other than U.S. dollars and as result of any variation as
between (i) the rate of exchange at which the U.S. dollar amount is converted
into the Judgment Currency for the purpose of such judgment or order and (ii) the
spot rate of exchange in The City of New York at which any such Person on the
date of payment of such judgment or order is able to purchase U.S. dollars with
the amount of the Judgment Currency actually received by such Person.  The foregoing indemnity shall continue in
full force and effect notwithstanding any such judgment or order as aforesaid.  The term “spot rate of exchange” shall
include any premiums and costs of exchange payable in connection with the
purchase of, or conversion into, U.S. dollars.


 


12

















 


ARTICLE TWO


 


SECURITY FORMS


 


SECTION 201.          Forms Generally.


 


The Securities of each series shall be in
substantially the forms established in one or more indentures supplemental
hereto or approved from time to time by or pursuant to a Board Resolution in
accordance with Section 301, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and any indenture supplemental hereto, and may have
such letters, numbers or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any
securities exchange or securities regulatory authority or as may, consistently
herewith, be determined by the officers executing such Securities, as evidenced
by their execution of the Securities.  If
the form of Securities of any series is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the secretary or an assistant secretary of each of the Company and
the Guarantor and delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 303 for the authentication and
delivery of such Securities.


 


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


 


SECTION 202.          Form of Trustee’s
Certificate of Authentication.


 


The Trustee’s certificate of authentication
required by this Article Two shall be in substantially the form set forth
below and executed by the Trustee by manual signature.


 


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


 


	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME OF TRUSTEE],

  	
   

  
	
   

  	
  as Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Officer”

  
				



 


SECTION 203.          Securities Issuable in the
Form of a Global Security.


 


(a)           If the Company shall establish pursuant to Sections 201
and 301 that the Securities of a particular series are to be issued in whole or
in part in the form of one or more Global Securities, then the Company (along
with an executed Guarantee endorsed thereon) shall execute and the Trustee
shall, in accordance with Section 303 and the Company Order delivered to
the Trustee thereunder, authenticate and deliver, such Global Security or
Securities (including the Guarantees thereon), which (i) shall represent,
and shall be denominated in an amount equal to the aggregate principal amount
of, the Outstanding Securities of such series to be represented by such Global
Security or Securities, (ii) shall be registered in the name of the
Depositary for such Global Security or Securities or its nominee, (iii) shall
be delivered 


 


13

















 


by the Trustee to the Depositary or its
custodian or pursuant to the Depositary’s instruction and (iv) shall bear
a legend substantially to the following effect: 
“UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE
INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY (AND THE RELATED
GUARANTEE) MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE (I) BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR (II) BY A NOMINEE OF THE
DEPOSITARY OR THE DEPOSITARY TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.  UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER AND THE
GUARANTOR OR THEIR AGENTS FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”


 


(b)           Notwithstanding any other provision of this Section 203
or of Section 305, unless the terms of a Global Security expressly permit
such Global Security to be exchanged in whole or in part for individual
Securities, a Global Security may be transferred, in whole but not in part and
in the manner provided in Section 305, only to another nominee of the
Depositary for such Global Security, or to a successor Depositary for such
Global Security selected or approved by the Company or to a nominee of such
successor Depositary.


 


(c)           (i)            If at
any time the Depositary for a Global Security notifies the Company that it is
unwilling or unable to continue as Depositary for such Global Security or if at
any time the Depositary for the Securities for such series shall no longer be
eligible or in good standing under the Exchange Act or other applicable statute
or regulation, the Company shall appoint a successor Depositary with respect to
such Global Security.  If a successor
Depositary for such Global Security is not appointed by the Company within 90
days after the Company receives such notice or becomes aware of such
ineligibility, the Company will execute a Company Order for the authentication
and delivery of individual Securities of such series in exchange for such
Global Security, and the Trustee, upon receipt of such Company Order, will
authenticate and deliver individual Securities of such series of like tenor and
terms in definitive form in an aggregate principal amount equal to the
principal amount of the Global Security in exchange for such Global Security
and the Guarantor shall execute Guarantees thereon.


 


(ii)           If an Event of Default shall have occurred and be
continuing or an event shall have occurred which with the giving of notice or
lapse of time or both, would constitute an Event of Default with respect to the
Securities represented by such Global Security, the Trustee, upon receipt of a
Company Order for the authentication and delivery of individual Securities of
such series in exchange for such Global Security, will authenticate and deliver
individual Securities of such series of like tenor and terms in definitive form
in an aggregate principal amount equal to the principal amount of the Global Security
in exchange for such Global Security and the Guarantor shall execute Guarantees
thereon.


 


(iii)          The Company may at any time and in its sole discretion
determine that the Securities of any series issued or issuable in the form of
one or more Global Securities shall no longer be represented by such Global
Security or Securities.  In such event
the Company will execute, and the Trustee, upon receipt of a Company Order for
the authentication and delivery of individual Securities of such series in
exchange in whole or in part for such Global Security, will authenticate and
deliver individual Securities of such series of like tenor and terms in
definitive form in an aggregate principal amount equal to 


 


14

















 


the principal amount of such Global Security
or Securities representing such series to be so exchanged for such Global
Security or Securities and the Guarantor shall execute Guarantees thereon.


 


(iv)          If specified by the Company pursuant to Section 301
with respect to Securities issued or issuable in the form of a Global Security,
the Depositary for such Global Security may surrender such Global Security in
exchange in whole or in part for individual Securities of such series of like
tenor and terms in definitive form on such terms as are acceptable to the
Company and such Depositary.  Thereupon
the Company shall execute, the Guarantor shall execute Guarantees, and the
Trustee shall authenticate and deliver, without service charge, (1) to
each Person specified by such Depositary a new Security or Securities of the
same series of like tenor and terms and of any authorized denomination of
$1,000 and any integral multiple thereof as requested by such Person in
aggregate principal amount equal to and in exchange for such Person’s
beneficial interest in the Global Security; and (2) to such Depositary a
new Global Security of like tenor and terms and in a denomination equal to the
difference, if any, between the principal amount of the surrendered Global
Security and the aggregate principal amount of Securities delivered to Holders
thereof.


 


(v)           In any exchange provided for in any of the preceding four
paragraphs, the Company will execute, the Guarantor shall execute Guarantees on
and the Trustee will authenticate and deliver individual Securities in
definitive registered form in authorized denominations of $1,000 and any
integral multiple thereof.  Upon the
exchange of a Global Security for individual Securities, such Global Security
shall be cancelled by the Trustee. 
Securities issued in exchange for a Global Security pursuant to this Section 203
shall be registered in such names and in such authorized denominations as the
Depositary for such Global Security, pursuant to instructions from its direct
or indirect participants or otherwise, shall instruct the Trustee.  The Trustee shall deliver such Securities to
the Persons in whose names such Securities are so registered.


 


SECTION 204.          Form of Guarantee.


 


The form of Guarantee shall be set forth on
the Securities as follows:


 


For value received, Arch Capital Group Ltd.
hereby unconditionally guarantees on an unsecured, subordinated basis to the
holder of this Security the payment of principal of (and premium, if any) and
interest on the Security upon which this Guarantee is endorsed in the amounts
and at the times when due and payable whether by declaration thereof, or
otherwise, and interest on the overdue principal of (and premium, if any) and
interest on such Security, if lawful, and the payment or performance of all
other obligations of the Company under the Indenture or the Securities, to the
holder of such Security and the Trustee, all in accordance with and subject to
the terms and limitations of such Security and Article Thirteen and Article Fifteen
of the Indenture.  This Guarantee will
not become effective until the Trustee duly executes the certificate of
authentication on this Security.  This
Guarantee shall be governed by and construed in accordance with the laws of the
State of New York.


 


Dated:


 


	
   

  	
  ARCH CAPITAL
  GROUP LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


15
















 


ARTICLE THREE



THE SECURITIES


 


SECTION 301.          Amount Unlimited; Issuable
in Series.


 


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


 


The Securities may be issued in one or more
series.  There shall be established in or
pursuant to a Board Resolution of each of the Company and the Guarantor and set
forth in an Officers’ Certificate of each of the Company and the Guarantor, or
established in one or more indentures supplemental hereto, prior to the
issuance of Securities of any series,


 


(1)           any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under this
Indenture (except for Securities authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 203, 304, 305, 306, 906 or 1107);


 


(2)           if the price (expressed as a percentage of the aggregate
principal amount thereof) at which such Securities will be issued is a price
other than the principal amount thereof, the portion of the principal amount
thereof payable upon declaration of acceleration of the maturity thereof, or if
applicable, the portion of the principal amount of such Securities that is
convertible into another security or the method by which any such portion shall
be determined;


 


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


 


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


 


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


 


(6)           the period of periods within which, the price or prices or
ratios at which and the terms and conditions upon which Securities of the series
may be redeemed, converted or exchanged, in whole or in part;


 


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


 


(8)           if other than the full principal amount, the portion of
the principal amount of Securities of the series which will be payable upon
declaration of acceleration or provable in bankruptcy;


 


(9)           additional or alternative events of default;


 


16

















 


(10)         the currency or currencies, including composite currencies,
in which payment of the principal of (and premium, if any) and interest, if
any, on such Securities shall be payable (if other than the currency of the
United States of America), which unless otherwise specified shall be the
currency of the United States of America as at the time of payment is legal
tender for payment of public or private debts;


 


(11)         if the principal of (and premium, if any) or interest, if
any, on such Securities is to be payable, at the election of the Company or any
Holder thereof, in a coin or currency other than that in which such Securities
are stated to be payable, then the period or periods within which, and the
terms and conditions upon which, such election may be made;


 


(12)         whether interest will be payable in cash or additional
Securities at the Company’s or the Holders’ option and the terms and conditions
upon which the election may be made;


 


(13)         if such Securities are to be denominated in a currency or
currencies, including composite currencies, other than the currency of the
United States of America, the equivalent price in the currency of the United
States of America for purposes of determining the voting rights of Holders of
such Securities as Outstanding Securities under this Indenture;


 


(14)         if the amount of payments of principal of (and premium, if
any), or portions thereof, or interest, if any, on such Securities may be
determined with reference to an index, formula or other method based on a coin
or currency other than that in which such Securities are stated to be payable,
the manner in which such amounts shall be determined;


 


(15)         additional or alternative covenants or other material terms
relating to the offered Securities;


 


(16)         whether the Securities of the series shall be issued in
whole or in part in the form of a Global Security or Securities; the terms and
conditions, if any, upon which such Global Security or Securities may be
exchanged in whole or in part for other individual Securities; and the Depositary
for such Global Security or Securities;


 


(17)         if other than as set forth in this Indenture, any terms with
respect to subordination of such Securities and/or the Guarantee, including,
without limitation, the definitions of “Company Senior Indebtedness” and/or “Guarantor
Senior Indebtedness”;


 


(18)         any listing of such Securities on any securities exchange;


 


(19)         additional or alternative provisions, if any, related to
defeasance and discharge of the offered Securities;


 


(20)         the applicability of the Guarantee or any other guarantees;


 


(21)         if convertible into Arch Capital Common Shares, Arch Capital
Preference Shares or shares of Preferred Stock the terms on which such
Securities are convertible, including the initial conversion price, the
conversion period, any events requiring an adjustment of the applicable conversion
price and any requirements relating to the reservation of such Arch Capital
Common Shares, Arch Capital Preference Shares or shares of Preferred Stock for
purposes of conversion;


 


(22)         provisions, if any, granting special rights to the Holders
of Securities of the series upon the occurrence of such events as may be
specified;


 


17

















 


(23)         each initial Place of Payment; and


 


(24)         any other terms of the series.


 


All Securities of any one series shall be
substantially identical except as to denomination and except as may otherwise
be provided in or pursuant to such Board Resolution and set forth in such
Officers’ Certificate or in any such indenture supplemental hereto.


 


If any of the terms of the Securities of any
series are established by action taken pursuant to a Board Resolution, a copy
of an appropriate record of such action shall be certified by the secretary or
an assistant secretary of the Company or the Guarantor, as applicable, and
delivered to the Trustee at or prior to the delivery of the Officers’
Certificate setting forth the terms of the Securities of any series (any one
Person may sign both such copy in his capacity as secretary or assistant
secretary and such Officer’s Certificate in his capacity as an officer).


 


SECTION 302.          Denominations.


 


The Securities of each series shall be
issuable in registered form without coupons in such denominations as shall be
specified as contemplated by Section 301. 
In the absence of any such provisions with respect to the Securities of
any series, the Securities of such series shall be issuable in denominations of
$1,000 and any integral multiple thereof.


 


SECTION 303.          Execution, Authentication,
Delivery and Dating.


 


The Securities shall be executed on behalf of
the Company by any one of the following individuals: its chairman of the Board
of Directors, a vice chairman, its president, treasurer, secretary or any of
its vice presidents.  The signature of
any of these individuals on the Securities may be manual or facsimile.


 


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


 


At any time and from time to time after the
execution and delivery of this Indenture, the Company may deliver Securities of
any series executed by the Company to the Trustee for authentication, together
with a Company Order for the authentication and delivery of such Securities,
and the Trustee in accordance with the Company Order shall authenticate and
deliver such Securities.  If the form or
terms of the Securities of the series have been established in or pursuant to
one or more Board Resolutions as permitted by Sections 201 and 301, or by one
or more indentures supplemental hereto as provided by Section 901, in
authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, if it so requests, and (subject to Section 601) shall
be fully protected in relying upon, an Opinion of Counsel of the Company
stating:


 


(a)           that such form has been established in conformity with the
provisions of this Indenture;


 


(b)            that such terms have been established in conformity with
the provisions of this Indenture;


 


(c)           that this Indenture and such Securities, when
authenticated and delivered by the Trustee and issued by the Company in the
manner and subject to any conditions specified in such 


 


18

















 


Opinion of Counsel, will
constitute valid and legally binding obligations of the Company, enforceable in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization and other laws of general applicability relating to
or affecting the enforcement of creditors’ rights and to general equity
principles;


 


(d)           that all laws and requirements in respect of the execution
and delivery by the Company of the Securities have been complied with; and


 


(e)           such other matters as the Trustee may reasonably request.


 


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


 


Each Security shall be dated the date of its
authentication unless otherwise provided by the terms established and contemplated
by Section 301.


 


No Security shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication substantially in the
form provided for herein executed by the Trustee by manual signature, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder and is entitled to the benefits of this Indenture.


 


SECTION 304.          Temporary Securities.


 


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


 


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


 


SECTION 305.          Registration; Registration
of Transfer and Exchange.


 


The Company shall cause to be kept at one of
its offices or agencies maintained pursuant to Section 1002 or at the
Corporate Trust Office of the Trustee a register (the register maintained in
such office and in any other office or agency of the Company in a Place of
Payment being herein sometimes collectively referred to as the “Security Register”) in which, subject to Section 203
and to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Securities and of 


 


19

















 


transfers of
Securities.  The Trustee initially is
hereby appointed “Security Registrar”
for the purpose of registering Securities and transfers of Securities as herein
provided.  The Company may act as
Security Registrar and may change or appoint a Security Registrar without prior
notice to Holders or to the Trustee.


 


Subject to Section 203, upon surrender
for registration of transfer of any Security of any series at the office or
agency in a Place of Payment for that series, the Company shall execute and the
Guarantor shall execute Guarantees on, and the Trustee shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more new
Securities of the same series, of any authorized denominations and of a like
aggregate principal amount and tenor.  In
the case of a transfer of part of any Security, the Company shall execute, the
Guarantor shall execute Guarantees on, and the Trustee shall authenticate and
deliver, one or more new Securities of the same series in the name of the
designated transferee or transferees, in respect of the part transferred, and
one or more new Securities of the same series, in respect of the balance of the
old Security not transferred, in the name of the transferor.


 


Subject to Section 203, at the option of
the Holder, Securities of any series may be exchanged for other Securities of
the same series, of any authorized denominations and of a like aggregate principal
amount and tenor, upon surrender of the Securities to be exchanged at such
office or agency.  Whenever any
Securities are so surrendered for exchange, the Company shall execute, the
Guarantor shall execute Guarantees on, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.


 


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


 


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


 


No service charge shall be made for any
registration of transfer or exchange of Securities, but the Company or the
Trustee may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section 203, 304,
906 or 1107 not involving any transfer.


 


The Company shall not be required (i) to
issue, register the transfer of or exchange Securities of any series during a
period beginning at the opening of business 15 days before the day of the mailing
of a notice of redemption of Securities of that series selected for redemption
(under Section 1103) and ending at the close of business on the day of
such mailing, or (ii) to register the transfer of or exchange any Security
so selected for redemption in whole or in part, except the unredeemed portion
of any Security being redeemed in part.


 


SECTION 306.          Mutilated, Destroyed, Lost
and Stolen Securities.


 


If there shall be delivered to the Company,
the Guarantor and the Trustee (i)(A) any mutilated Security or (B) evidence
to their satisfaction of the destruction, loss or theft of any Security and (ii) such
security or indemnity as may be required by them to hold each of them and any
agent of either of them harmless, then, in the absence of notice to the Company
or the Trustee that such Security has been acquired by a bona fide purchaser,
the Company and the Guarantor, if applicable, shall execute and upon its
request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security or 


 


20

















 


in exchange
for such mutilated Security, a new Security of the same series and of like
tenor and principal amount and bearing a number not contemporaneously
outstanding.


 


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


 


Upon the issuance of any new Security under
this Section 306, the Company may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee)
connected therewith.


 


Every new Security of any series issued
pursuant to this Section 306 in lieu of any destroyed, lost or stolen
Security or in exchange for such mutilated Security, shall constitute an
original additional contractual obligation of the Company, whether or not the
mutilated, destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Securities and the Guarantee of that
series duly issued hereunder.


 


The provisions of this Section 306 are
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities.


 


SECTION 307.          Payment of Interest;
Interest Rights Preserved.


 


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


 


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


 


(1)           The Company or the Guarantor may elect to make payment of
any Defaulted Interest to the Persons in whose names the Securities of such
series (or their respective Predecessor Securities) are registered at the close
of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner.  The Company or the Guarantor shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid on
each Security of such series and the date of the proposed payment (which
proposed payment date shall be not less than 20 days after the Company’s
written notice to the Trustee, unless the Trustee and the Company shall agree
otherwise), and at the same time the Company or the Guarantor shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to
be paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix the Special
Record Date for the payment of such Defaulted Interest which shall be not more
than 15 days and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee of the
notice of the proposed payment.  The
Trustee shall promptly notify the Company and the Guarantor of such Special
Record Date and, in the name and at the expense of the Company or the Guarantor,
shall cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be mailed, first-class postage prepaid, to each
Holder of Securities of such 


 


21

















 


series at his
address as it appears in the Security Register, not less than 10 days prior to
such Special Record Date.  Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the
Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following clause
(2).


 


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


 


Subject to the foregoing provisions of this Section 307,
each Security lawfully delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security shall carry the
rights to interest accrued and unpaid, and to accrue, which were carried by
such other Security.


 


SECTION 308.          Persons Deemed Owners.


 


The Company, the Guarantor, the Trustee and
any agent of the Company, the Guarantor or the Trustee may treat the Person in
whose name such Security is registered as the owner of such Security for the purpose
of receiving payment of principal of (and premium, if any) and (subject to Section 307)
interest on such Security and for all other purposes whatsoever, whether or not
such Security be overdue, and none of the Company, the Guarantor, the Trustee
or any agent of the Company, the Guarantor or the Trustee shall be affected by
notice to the contrary.


 


SECTION 309.          Cancellation.


 


All Securities surrendered for payment,
redemption, registration of transfer or exchange or for credit against any
sinking fund payment shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee and shall be promptly cancelled by
it.  The Company or the Guarantor may at
any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company or the Guarantor may
have acquired in any manner whatsoever, and all Securities so delivered shall
be promptly cancelled by the Trustee.  No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section 309, except as expressly permitted
by this Indenture.  The Trustee shall
destroy cancelled Securities in accordance with its customary procedures, and,
if so requested by the Company in writing, deliver a certificate of such
destruction to the Company or the Guarantor.


 


SECTION 310.          Computation of Interest.


 


Except as otherwise specified as contemplated
by Section 301 for the Securities of any series, interest on the Securities
of each series shall be computed on the basis of a 360-day year of twelve
30-day months.


 


SECTION 311.          CUSIP and ISIN Numbers.


 


The Company in issuing the Securities may use
“CUSIP” and “ISIN” numbers (if then generally in use), and the Trustee shall
use CUSIP or ISIN numbers, as the case may be, in notices of redemption or 


 


22

















 


exchange as a
convenience to Holders and no representation shall be made as to the correctness
of such numbers either as printed on the Securities or as contained in any
notice of redemption or exchange.


 


ARTICLE FOUR


 


SATISFACTION AND DISCHARGE


 


SECTION 401.          Satisfaction and Discharge
of Indenture.


 


This Indenture shall upon Company Request
from the Company and the Guarantor cease to be of further effect with respect
to any series of Securities (except with respect to Sections 304, 305, 306,
402, 405, 606, 607, 608, 609, 610, 611, 612, 613, 701, 702, 1002 and 1003 and Article Twelve,
in each case, to the extent such Section or Article relates to such
series of Securities, which Sections and Article shall survive until no
Securities of such series are Outstanding), and the Trustee, at the expense of
the Company or the Guarantor, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to any series of
Securities, on the first date when:


 


(1)           either:


 


(A)          all
Securities of such series theretofore authenticated and delivered (other than (i) Securities
of such series which have been mutilated, destroyed, lost or stolen and which
have been replaced or paid as provided in Section 306 and (ii) Securities
of such series for whose payment money has theretofore been deposited in trust
or segregated and held in trust by the Company or the Guarantor and thereafter
repaid to the Company or the Guarantor or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or


 


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


 


(i)            have
become due and payable, or


 


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


 


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


 


and the Company or the Guarantor, in the case
of (i), (ii) or (iii) above, has deposited or caused to be deposited
with the Trustee as trust funds in trust for the purpose:


 


(i)            money
in U.S. dollars (or if the Securities are denominated in a currency other than
U.S. dollars, an amount of the applicable currency) in an amount sufficient, or


 


(ii)           (a) U.S.
Government Obligations which through the payment of interest and principal in
respect thereof in accordance with their terms will provide not later than one
day before the due date of any payment referred to in clause (B) of this
subparagraph money in an amount, or (b) a combination of such money and
such U.S. Government Obligations, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee,


 


23

















 


to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal (and premium, if any) and interest to the date of
such deposit (in the case of Securities which have become due and payable) or
to the Stated Maturity or Redemption Date, as the case may be;


 


(2)           if
all series of Securities are being discharged, the Company or the Guarantor has
paid or caused to be paid all other sums payable hereunder by the Company or
the Guarantor; and


 


(3)           the
Company and the Guarantor have delivered to the Trustee an Officers’ Certificate
(upon which the Trustee may conclusively rely) stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.


 


Notwithstanding the satisfaction and discharge
of this Indenture, the obligations of the Company and the Guarantor to the
Trustee under Section 607, and, if money or U.S. Government Obligations
shall have been deposited with the Trustee pursuant to subclause (B) of
clause (1) of this Section 401, the obligations of the Trustee under Section 402
and the next to last paragraph of Section 1003, shall survive.


 


SECTION 402.          Application of Trust
Funds; Indemnification.


 


(a)           Subject to the provisions of the next to last paragraph of
Section 1003, all money and U.S. Government Obligations deposited with the
Trustee pursuant to Section 401, 403 or 404 and all money received by the
Trustee in respect of U.S. Government Obligations deposited with the Trustee pursuant
to Section 401, 403 or 404 shall be held in trust and applied by it, in
accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company or
the Guarantor acting as Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and premium, if any) and interest for whose
payment such money has been deposited with or received by the Trustee or to
make mandatory sinking fund payments or analogous payments as contemplated by Section 403
or 404, but such money need not be segregated from other funds except to the
extent required by law.


 


(b)           The Company or the Guarantor shall pay and shall indemnify
the Trustee against any tax, fee or other charge imposed on or assessed against
U.S. Government Obligations deposited pursuant to Section 401, 403 or 404,
or the interest and principal received in respect of such obligations other
than any payable by or on behalf of Holders.


 


(c)           The Trustee shall deliver or pay to the Company or the
Guarantor from time to time upon Company Request from the Company or the
Guarantor, as the case may be, any U.S. Government Obligations or money held by
it as provided in Section 401, 403 or 404 which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are then in excess of
the amount thereof which then would have been required to be deposited for the
purpose for which such obligations or money were deposited or received.


 


SECTION 403.          Defeasance and Discharge
of Indenture.


 


The Company and the Guarantor shall be deemed
to have paid and discharged the entire indebtedness on all the Outstanding
Securities on the first date all the conditions set forth in the proviso below
are satisfied, and the provisions of this Indenture, as it relates to such Outstanding
Securities, shall no longer be in effect (and the Trustee, at the expense of
the Company or the Guarantor, shall at Company Request from the Company or the
Guarantor, as the case may be, execute proper instruments acknowledging the
same), except as to:


 


24

















 


(a)           the rights of Holders of Securities
to receive, from the trust funds described in subparagraph (1) hereof, (i) payment
of the principal of (and premium, if any) and each installment of principal of
(and premium, if any) or interest on the Securities on the Stated Maturity of
such principal or installment of principal or interest or on a Redemption Date
and (ii) the benefit of any mandatory sinking fund payments applicable to
the Securities on the day on which such payments are due and payable in
accordance with the terms of this Indenture and the Securities;


 


(b)           the Company’s and the Guarantor’s
obligations with respect to such Securities under Sections 304, 305, 306, 402,
405, 701, 702, 1002 and 1003; and


 


(c)           the obligations of the Company and
the Guarantor to the Trustee under Section 607,


 


provided
that the following conditions shall have been satisfied:


 


(1)           the
Company or the Guarantor has or caused to be irrevocably deposited (except as
provided in Section 402) with the Trustee as trust funds in trust,
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of the Securities,


 


(i)            money in U.S.
Dollars (or if the Securities are denominated in a currency other than U.S.
dollars, an amount of the applicable currency) in an amount sufficient, or


 


(ii)           (a) U.S.
Government Obligations which through the payment of interest and principal in
respect thereof in accordance with their terms will provide not later than one
day before the due date of any payment referred to in clause (A) or (B) of
this subparagraph money in an amount, or (b) a combination of such money
and such U.S. Government Obligations, sufficient, in the opinion of a
nationally recognized firm of independent certified public accountants
expressed in a written certification thereof delivered to the Trustee,


 


to pay and discharge (A) the
principal of (and premium, if any) and each installment of principal of (and
premium, if any) and interest on the Outstanding Securities on the Stated
Maturity of such principal or installment of principal or interest or on the
applicable Redemption Date and (B) any mandatory sinking fund payments
applicable to the Securities on the day on which such payments are due and
payable in accordance with the terms of this Indenture and of the Securities;


 


(2)           such
deposit shall not cause the Trustee with respect to the Securities to have a
conflicting interest for purposes of the Trust Indenture Act with respect to
the Securities;


 


(3)           such
deposit will not result in a breach or violation of, or constitute a default under,
any applicable laws, this Indenture or any other agreement or instrument to which
the Company or the Guarantor is a party or by which it is bound;


 


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


 


(5)           if
the deposit referred to in subparagraph (1) of this Section 403 is to
be made on or prior to one year from the Stated Maturity for payment of
principal of the Outstanding Securities, the Company and the Guarantor shall
have delivered to the Trustee an Opinion of Counsel with no material
qualifications or a favorable ruling of the Internal Revenue Service, in either



 


25

















 


case to the effect that Holders of the Securities will not recognize
income, gain or loss for federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to federal income tax on
the same amount and in the same manner and at the same times, as would have
been the case if such deposit, defeasance and discharge had not occurred.


 


SECTION 404.          Defeasance of Certain
Obligations.


 


If this Section 404 is specified to be
applicable to Securities of any series, as set forth in an indenture
supplemental hereto or Board Resolution with respect to such series, the
Company may omit to comply with (or elect to have the obligation of the
Guarantor released with respect to) any term, provision or condition set forth
in the sections of this Indenture or such Security with respect to the Securities
of that series (“Covenant Defeasance”) if:


 


(1)           with
reference to this Section 404, the Company or the Guarantor has deposited
or caused to be irrevocably deposited with the Trustee as trust funds in trust,
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of the Securities of that series,


 


(i)            money in U.S.
dollars (or if the Securities are denominated in a currency other than U.S.
dollars, an amount of the applicable currency) in an amount sufficient, or


 


(ii)           (a) U.S.
Government Obligations which through the payment of interest and principal in
respect thereof in accordance with their terms will provide not later than one
day before the due date of any payment referred to in clause (A) or (B) of
this subparagraph money in an amount, or (b) a combination of such money
and such U.S. Government Obligation, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee,


 


to pay and discharge (A) the
principal of (and premium, if any) and each installment of principal (and
premium, if any) and interest on the Outstanding Securities of that series on
the Stated Maturity of such principal or installment of principal or interest
and (B) any mandatory sinking fund payments or analogous payments
applicable to Securities of such series on the day on which such payments are
due and payable in accordance with the terms of the Indenture and of such Securities;


 


(2)           such deposit shall not cause the Trustee with respect to
the Securities of that series to have a conflicting interest for purposes of
the Trust Indenture Act with respect to the Securities of any series;


 


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


 


(4)           if the deposit referred to in subparagraph (1) of
this Section 404 is to be made on or prior to one year from the Stated
Maturity for payment of principal of the Outstanding Securities, the Company
and the Guarantor shall have delivered to the Trustee an Opinion of Counsel
with no material qualifications or a favorable ruling of the Internal Revenue
Service, in either case to the effect that Holders of the Securities will not
recognize income, gain or loss for federal income tax purposes as a result of
such deposit and defeasance of certain obligations and will be subject to
federal income tax on the same amount and in the same manner and at the same
times, as would have been the case if such deposit and defeasance had not occurred;
and


 


26
















 


(5)           the Company and the Guarantor shall have delivered to the
Trustee an Officers’ Certificate (upon which the Trustee may conclusively rely)
stating that all conditions precedent herein provided for relating to the
defeasance contemplated by this Section 404 have been complied with.


 


SECTION 405.          Reinstatement.


 


If the Trustee or Paying Agent is unable to
apply any money or U.S. Government Obligations in accordance with Section 401,
403 or 404 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company’s and the Guarantor’s
obligations under this Indenture, the Securities of the applicable series and
the Guarantee thereof shall be revived and reinstated as though no deposit had
occurred pursuant to Section 401, 403 or 404, as the case may be, until
such time as the Trustee or Paying Agent is permitted to apply all such money
or U.S. Government Obligations in accordance with Section 401, 403 or 404; provided that, if the Company or the Guarantor has made
any payment of principal of or interest on the Securities of any series because
of the reinstatement of their obligations, the Company and the Guarantor shall
be subrogated to the rights of the Holders of such Securities to receive such
payment from the money or U.S. Government Obligations held by the Trustee or
Paying Agent.


 


ARTICLE FIVE



REMEDIES


 


SECTION 501.          Events of Default.


 


“Event of Default”
(except as otherwise specified or contemplated by Section 301 for Securities
of any series), wherever used herein with respect to Securities of any series,
means any one of the following events:


 


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


 


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


 


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


 


(4)           default
in the performance, or breach, of any covenant of the Company or the Guarantor
in this Indenture, the Securities or the Guarantee (other than a covenant a
default in whose performance or whose breach is elsewhere in this Section 501
specifically dealt with or which has expressly been included in this Indenture
solely for the benefit of series of Securities other than that series) and
continuance of such default or breach for a period of 60 days after there has
been given by registered or certified mail, to the Company or the Guarantor by
the Trustee, or to the Company, the Guarantor and the Trustee by the Holders of
at least 25% in principal amount of the Outstanding Securities of such series,
a written notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a “Notice of Default” hereunder; or


 


(5)           the
entry by a court having jurisdiction in the premises of (A) a decree or
order for relief in respect of the Company or the Guarantor in an involuntary
case or proceeding under any applicable bankruptcy, insolvency, reorganization
or other similar law or (B) a decree or 


 


27

















 


order adjudging the Company or the Guarantor a bankrupt or insolvent,
or approving as properly filed a petition seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company or the Guarantor
under any applicable law, or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or the
Guarantor or of any substantial part of its property, or ordering the winding
up or liquidation of its affairs, and the continuance of any such decree or
order for relief or any such other decree or order unstayed and in effect for a
period of 60 consecutive days; or


 


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


 


(7)           the
Guarantee ceases to be in full force and effect or is declared to be null and
void and unenforceable or is found to be invalid, in each case by a court of
competent jurisdiction in a final non-appealable judgment, or the Guarantor
denies its liability under the Guarantee (other than by reason of release of
the Guarantor in accordance with the terms of this Indenture); or


 


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


 


SECTION 502.          Acceleration of Maturity;
Rescission and Annulment.


 


If an Event of Default (other than with
respect to an Event of Default under clause (5) or (6) of Section 501)
with respect to Securities of any series at the time Outstanding occurs and is
continuing, then in every such case the Trustee or the Holders of not less than
25% in principal amount of the Outstanding Securities of that series may
declare the principal amount (or, if the Securities of that series are Original
Issue Discount Securities, such portion of the principal amount as may be
specified in the terms of that series) of all of the Securities of that series
to be due and payable immediately, by a notice in writing to the Company and
the Guarantor (and to the Trustee if given by Holders), and upon any such declaration
such principal amount (or specified amount) shall become immediately due and
payable.


 


In the case of an Event of Default of the
type set forth in clause (5) or (6) of Section 501, which occurs
and is continuing with respect to Securities of any series at the time Outstanding,
then all unpaid principal of and accrued interest on all such Outstanding Securities
of that series shall become immediately due and payable without any notice or
other action on the part of the Trustee or the Holders of any Securities of
such series.


 


28

















 


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


 


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


 


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


 


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


 


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


 


(D)          all
sums paid or advanced by the Trustee and any predecessor Trustee hereunder and
all sums due the Trustee and any predecessor Trustee under Section 607;


 


and


 


(2)           all
Events of Default with respect to Securities of that series, other than the
non-payment of the principal of Securities of that series which have become due
solely by such declaration of acceleration, have been cured or waived as
provided in Section 513.


 


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


 


SECTION 503.          Collection of Indebtedness
and Suits for Enforcement by Trustee.


 


The Company and the Guarantor covenant that
if:


 


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


 


(2)           default
is made in the payment of the principal of (or premium, if any, on) any
Security at the Maturity thereof,


 


the Company or the Guarantor
will, upon demand of the Trustee, pay to it, for the benefit of the Holders of
such Securities, the whole amount then due and payable on such Securities for
principal (and premium, if any) and interest and interest on any overdue
principal (and premium, if any) and on any overdue interest, at the rate or
rates prescribed therefor in such Securities, to the extent that payment of
such interest (or premium, if any) shall be legally enforceable, and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including all amounts due the Trustee and any
predecessor Trustee under Section 607.


 


If the Company or the Guarantor fails to pay
such amounts forthwith upon such demand, the Trustee, in its own name and as
trustee of an express trust, may institute a judicial proceeding for the collection
of the sums so due and unpaid, may prosecute such proceeding to judgment or
final decree and may enforce the same against the Company or any other obligor
upon such Securities and collect the 


 


29

















 


moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon such Securities, wherever
situated.


 


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


 


SECTION 504.          Trustee May File
Proofs of Claim.


 


In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to the Company or the Guarantor
or any other obligor upon the Securities or the property of the Company or the
Guarantor or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal of the Securities shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company or the Guarantor
for the payment of overdue principal, premium or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,


 


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


 


(ii)           to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;


 


and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 607.


 


Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize
the Trustee to vote in respect of the claim of any Holder in any such proceeding.


 


SECTION 505.          Trustee May Enforce
Claims without Possession of Securities.


 


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


 


30

















 


SECTION 506.          Application of Money
Collected.


 


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


 


FIRST:  To the payment of all amounts due the Trustee
and each predecessor Trustee under Section 607;


 


SECOND:  To the payment of the amounts then due and
unpaid for principal of (and premium, if any) and interest on the Securities in
respect of which or for the benefit of which such money has been collected
ratably, without preference or priority of any kind, according to the amounts
due and payable on such Securities for principal (and premium, if any) and
interest, respectively; and


 


THIRD:  To the Company.


 


SECTION 507.          Limitation on Suits.


 


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


 


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


 


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


 


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


 


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


 


(5)           no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Securities of that series;


 


it being understood and
intended that no one or more of such Holders shall have any right in any manner
whatever by virtue of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other of such Holders, or to
obtain or to seek to obtain priority or preference over any other of such
Holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all such Holders.


 


SECTION 508.          Unconditional Right of
Holders to Receive Principal, Premium and Interest.


 


Notwithstanding any other provision in this
Indenture, the Holder of any Security shall have the right, which is absolute
and unconditional, to receive payment of the principal of (and premium, if any)



 


31

















 


and (subject
to Section 307) interest on such Security on the Stated Maturity or
Maturities expressed in such Security or the Guarantee thereof (or, in the case
of redemption, on the Redemption Date) and to institute suit for the
enforcement of any such payment, including under the Guarantee, and such rights
shall not be impaired without the consent of such Holder.


 


SECTION 509.          Restoration of Rights and
Remedies.


 


If the Trustee or any Holder has instituted
any proceeding to enforce any right or remedy under this Indenture or the
Guarantee and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the Company,
the Guarantor, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.


 


SECTION 510.          Rights and Remedies
Cumulative.


 


Except as otherwise provided with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities
in the last paragraph of Section 306, no right or remedy herein or in the Guarantee
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other right
and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise.  The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.


 


SECTION 511.          Delay or Omission Not
Waiver.


 


No delay or omission of the Trustee or of any
Holder of any Securities to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver
of any such Event of Default or any acquiescence therein.  Every right and remedy given by this Article Five
or by law to the Trustee or to the Holders may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the Holders, as
the case may be.


 


SECTION 512.          Control by Holders.


 


The Holders of a majority in principal amount
of the Outstanding Securities of any series (or if more than one series is
affected thereby, of all series so affected, voting as a single class) shall
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, with respect to the Securities of such series,
provided that:


 


(1)           such direction shall not be in conflict with any rule of
law or with this Indenture, expose the Trustee to personal liability or be
unduly prejudicial to holders not joining therein, and


 


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


 


SECTION 513.          Waiver of Past Defaults.


 


Subject to Section 502, the Holders of
not less than a majority in principal amount of the Outstanding Securities of
any series may on behalf of the Holders of all the Securities of such series
waive any past default hereunder with respect to such series and its
consequences, except a default:


 


32

















 


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


 


(2)           in respect of a covenant or provision hereof which cannot
be modified or amended without the consent of the Holder of each Outstanding
Security of such series affected.


 


Upon any such waiver, such default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon.


 


SECTION 514.          Undertaking for Costs.


 


All parties to this Indenture agree, and each
Holder of any Security by his acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken, suffered or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys’ fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made
by such party litigant; but the provisions of this Section 514 shall not apply
to any suit instituted by the Company, to any suit instituted by the Trustee,
to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% in principal amount of the Outstanding Securities of
any series, or to any suit instituted by any Holder for the enforcement of the
payment of the principal of (or premium, if any) or interest on any Securities
on or after the Stated Maturity or Maturities expressed in such Security (or,
in the case of redemption, on or after the Redemption Date).  This Section 514 shall be in lieu of Section 315(e) of
the Trust Indenture Act and such Section 315(e) is hereby expressly
excluded from this Indenture, as permitted by the Trust Indenture Act.


 


SECTION 515.          Waiver of Stay or
Extension Laws.


 


Each of the Company and the Guarantor
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company and the Guarantor (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution
of every such power as though no such law had been enacted.


 


ARTICLE SIX


 


THE TRUSTEE


 


SECTION 601.          Certain Duties and
Responsibilities.


 


(a)           Except during the continuance of an Event of Default with
respect to the Securities of any series,


 


(1)           the
Trustee undertakes to perform such duties and only such duties as are specifically
set forth in this Indenture with respect to such series, and no implied
covenants or obligations shall be read into this Indenture against the Trustee;
and


 


33

















 


(2)           in
the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but in the case of any such certificates
or opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this Indenture.


 


(b)           In case an Event of Default has occurred with respect to
Securities of any series and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture with respect to such
series of Securities, 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 conduct
of his own affairs.


 


(c)           No
provision of this Indenture shall be construed to relieve the Trustee from
liability for its own negligent or bad faith action, its own negligent or bad
faith failure to act, or its own willful misconduct, except that:


 


(1)           this
subsection shall not be construed to limit the effect of subsection (a) of
this Section 601;


 


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


 


(3)           the
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders of a
majority in principal amount of the Outstanding Securities of any series,
determined as provided in Section 512, relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture
with respect to the Securities of such series; and


 


(4)           no
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.


 


(d)           Whether
or not therein expressly so provided, every provision of this Indenture relating
to the conduct or affecting the liability of or affording protection to the
Trustee shall be subject to the provisions of this Section 601.


 


SECTION 602.          Notice of Defaults.


 


Within 90 days after the occurrence of any
default hereunder with respect to the Securities of any series, the Trustee
shall transmit by mail to all Holders of Securities of such series, as their
names and addresses appear in the Security Register, notice of such default
hereunder known to the Trustee, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
of the principal of (or premium, if any) or interest on any Security of such series
or in the payment of any sinking fund installment with respect to Securities of
such series, the Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee or a trust committee
of directors or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interest of the Holders of
Securities of such series; and provided, further, 


 


34

















 


that in the
case of any default of the character specified in Section 501(4) with
respect to Securities of such series, no such notice to Holders shall be given
until at least 30 days after the occurrence thereof.  For the purpose of this Section 602, the
term “default” means any event which is, or after notice or lapse of time or
both would become, an Event of Default with respect to Securities of such
series.


 


SECTION 603.          Certain Rights of Trustee.


 


Subject to the provisions of Section 601:


 


(a)           the Trustee may rely and shall be
protected in acting or refraining from acting upon any Board Resolution,
resolution, Officers’ Certificate, certificate, statement, instrument, Opinion
of Counsel, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;


 


(b)           any request or direction of the
Company mentioned herein shall be sufficiently evidenced by a Company Request
or Company Order and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;


 


(c)           whenever in the administration of
this Indenture the Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may, in the
absence of bad faith on its part, rely upon an Officers’ Certificate;


 


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


 


(e)           the Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be incurred
by it in compliance with such request or direction;


 


(f)            the Trustee shall not be bound to
make any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or other
paper or document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney;


 


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


 


(h)           the Trustee shall not be charged with
knowledge of any default or Event of Default with respect to any Securities
(other than with respect to an Event of Default described in clause (1), (2) or
(3) of Section 501) unless either (1) a Responsible Officer
shall have actual knowledge of such default or Event of Default or (2) written
notice of such default or Event of 


 


35

















 


Default shall have been given to the Trustee by the Company or by any
Holder of the Securities; and


 


(i)            the permissive rights of the Trustee
enumerated herein shall not be construed as duties.


 


SECTION 604.          Not Responsible for
Recitals or Issuance of Securities.


 


The recitals contained herein and in the
Securities, except the Trustee’s certificates of authentication, shall be taken
as the statements of the Company, and the Trustee assumes no responsibility for
their correctness.  The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities.  The Trustee shall not be
accountable for the use or application by the Company of Securities or the
proceeds thereof.


 


SECTION 605.          May Hold Securities.


 


The Trustee, any Paying Agent, any Security
Registrar or any other agent of the Company or the Guarantor, in its individual
or any other capacity, may become the owner or pledgee of Securities and,
subject to Sections 608 and 612, may otherwise deal with, and collect
obligations owed to it by, the Company or the Guarantor with the same rights it
would have if it were not Trustee, Paying Agent, Security Registrar or such
other agent.


 


SECTION 606.          Money Held in Trust.


 


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


 


SECTION 607.          Compensation and
Reimbursement.


 


The Company and the Guarantor, jointly and
severally, agree:


 


(1)           to
pay to the Trustee from time to time reasonable compensation for all services
rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);


 


(2)           except
as otherwise expressly provided herein, to reimburse each of the Trustee and
any predecessor Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by it in accordance with any
provision of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its own negligence or bad
faith; and


 


(3)           to
indemnify each of the Trustee and any predecessor Trustee for, and to hold it
harmless against, any loss, liability or expense, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder and the performance of its duties hereunder, including the costs and
expenses of defending itself against any claim or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense is due to its own negligence or
bad faith.


 


36

















 


To ensure the performance of the obligations
of the Company under this Section 607, the Trustee shall have a senior
claim to which the Securities are hereby made subordinate upon all property and
funds held or collected by the Trustee as such, except property and funds held
in trust for the payment of principal of (and premium, if any) or interest on
particular Securities.


 


If the Trustee incurs expenses or renders
services after the occurrence of an Event of Default specified in Section 501(5) or
(6), the expenses and compensation for the services will be intended to constitute
expenses of administration under any applicable bankruptcy law for relief of
debtors.


 


The provisions of this Section 607 shall
survive the resignation or removal of the Trustee and the termination of this
Indenture.


 


SECTION 608.          Disqualification;
Conflicting Interests.


 


The Trustee shall comply with the terms of Section 310(b) of
the Trust Indenture Act.


 


SECTION 609.          Corporate Trustee
Required; Eligibility.


 


There shall at all times be a Trustee
hereunder which shall be a corporation organized and doing business under the
laws of the United States of America, any State thereof or the District of Columbia,
authorized under such laws to exercise corporate trust powers having (or, in
the case of the subsidiary of a bank holding company that guarantees the
obligations of the Trustee under this Indenture, such holding company’s parent
shall have) a combined capital and surplus of at least $50,000,000 subject to
supervision or examination by Federal or State authority.  If such corporation or holding company parent
publishes reports of condition at least annually, pursuant to law or the
requirements of said supervising or examining authority, then for the purposes
of this Section 609, the combined capital and surplus of such corporation
or holding company parent shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.  If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 609, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article Six.


 


SECTION 610.          Resignation and Removal;
Appointment of Successor.


 


(a)           No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article Six shall
become effective until the acceptance of appointment by the successor Trustee
in accordance with the applicable requirements of Section 611.


 


(b)           The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company or the Guarantor.  If the
instrument of acceptance by a successor Trustee required by Section 611
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such series.  If the
acceptance of appointment is substantially contemporaneous with the resignation,
then the notice called for by the first sentence of this subsection may be
combined with the instrument called for by Section 611.


 


(c)           The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series delivered to the Trustee
and to the Company and the Guarantor.


 


(d)           If at any time:


 


37
















 


(1)           the Trustee shall
fail to comply with Section 608 after written request therefor by the
Company, the Guarantor or by any Holder who has been a bona fide Holder of a
Security for at least six months, or


 


(2)           the Trustee shall
cease to be eligible under Section 609 and shall fail to resign after
written request therefor by the Company, the Guarantor or by any such Holder,
or


 


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


 


then, in any such case, (i) the Company
or the Guarantor by a Board Resolution may remove the Trustee with respect to
all Securities, or (ii) subject to Section 514, any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to all Securities and
the appointment of a successor Trustee or Trustees.


 


(e)           If
the Trustee shall resign, be removed or become incapable of acting, or if a vacancy
shall occur in the office of Trustee for any cause, with respect to the
Securities of one or more series, the Company or the Guarantor, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series) and shall comply with
the applicable requirements of Section 611.  If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Company, the Guarantor and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of Section 611,
become the successor Trustee with respect to the Securities of such series and
to that extent supersede the successor appointed by the Company or the
Guarantor.  If no successor Trustee with
respect to the Securities of any series shall have been so appointed by the
Company or the Guarantor or the Holders and accepted appointment in the manner
required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.


 


(f)            The
Company or the Guarantor shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
by mailing written notice of such event by first-class mail, postage prepaid,
to all Holders of Securities of such series as their names and addresses appear
in the Security Register.  Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.


 


SECTION 611.          Acceptance of Appointment
by Successor.


 


(a)           In
case of the appointment hereunder of a successor Trustee with respect to all
Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company, the Guarantor and to the retiring
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the 


 


38





















 


retiring Trustee; but, on the request of the
Company, the Guarantor or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring
Trustee and shall duly assign, transfer and deliver to such successor Trustee
all property and money held by such retiring Trustee hereunder.


 


(b)           In
case of the appointment hereunder of a successor Trustee with respect to the
Securities of one or more (but not all) series, the Company, the Guarantor, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and confirm
to, and to vest in, each successor Trustee all the rights, powers, trusts and
duties of the retiring Trustee with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates, (2) if
the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring Trustee
is not retiring shall continue to be vested in the retiring Trustee, and (3) shall
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, it being understood that nothing herein or in such
supplemental indenture shall constitute such Trustees co-trustees of the same
trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such
supplemental indenture the resignation or removal of the retiring Trustee shall
become effective to the extent provided therein and each such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of such
successor Trustee relates; but, on request of the Company, the Guarantor or any
successor Trustee, such retiring Trustee shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder with respect to the Securities of that or those series to
which the appointment of such successor Trustee relates.


 


(c)           Upon
request of any such successor Trustee, the Company and the Guarantor shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to in
paragraph (a) or (b) of this Section 611, as the case may be.


 


(d)           No
successor Trustee shall accept its appointment unless at the time of such acceptance
such successor Trustee shall be qualified and eligible under this Article Six.


 


(e)           If
the instrument of acceptance by a successor Trustee required by this Section 611
shall not have been delivered to the Trustee within thirty (30) days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.


 


SECTION 612.          Merger, Conversion,
Consolidation or Succession to Business.


 


Any corporation into which the Trustee may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee (including the administration of this Indenture),
shall be the successor of the Trustee hereunder, provided such corporation
shall be otherwise qualified and eligible under this Article Six, without
the execution or filing of any paper or any further act on the part of any of
the parties hereto.  In case any
Securities shall have been authenticated, but not delivered, by the Trustee
then in office, any 


 


39

















 


successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.


 


SECTION 613.          Preferential Collection of
Claims Against Company.


 


If and when the Trustee shall be or become a
creditor of the Company or the Guarantor (or any other obligor upon the
Securities), the Trustee shall be subject to the provisions of the Trust Indenture
Act regarding the collection of claims against the Company or the Guarantor (or
any such other obligor).  A trustee who
has resigned or been removed shall be subject to the Trust Indenture Act Section 311(a) to
the extent provided therein.


 


ARTICLE SEVEN



HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY


 


SECTION 701.          Company to Furnish Trustee
Names and Addresses of Holders.


 


The Company will furnish or cause to be furnished to
the Trustee with respect to the Securities of each series:


 


(a)           semi-annually, not more than fifteen days after each
Regular Record Date, or, in the case of any series of Securities on which
semi-annual interest is not payable, not more than fifteen days after such
semi-annual dates as may be specified by the Trustee, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the Holders
as of such Regular Record Date or such semi-annual date, as the case may be,
and


 


(b)           at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company or the Guarantor of any such
request, a list of similar form and content as of a date not more than 15 days
prior to the time such list is furnished;


 


provided, however, that so long as
the Trustee is the Security Registrar, no such list need be furnished.


 


SECTION 702.          Preservation of
Information; Communications to Holders.


 


The Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Trustee as provided in Section 701 and
the names and addresses of Holders received by the Trustee.  The Trustee may destroy any list furnished to
it as provided in Section 701 upon receipt of a new list so furnished.


 


SECTION 703.          Reports by Trustee.


 


(a)           Within
60 days after [      ] of each year commencing
with the first [      ] following the date of
this Indenture, the Trustee shall transmit by mail to all Holders, as their
names and addresses appear in the Security Register, a brief report dated as of
such [      ], to the extent required by Section 313(a) of
the Trust Indenture Act.


 


(b)           The
Trustee shall comply with Sections 313(b), 313(c) and 313(d) of the
Trust Indenture Act.


 


40





















 


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


 


SECTION 704.          Reports by Guarantor.


 


The Guarantor shall:


 


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


 


(2)           file with the
Trustee and the Commission, in accordance with the rules and regulations
prescribed from time to time by the Commission, such additional information,
documents and reports with respect to compliance by the Company and the
Guarantor with the conditions and covenants of this Indenture as may be
required from time to time by such rules and regulations.


 


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


 


SECTION 705.          Communications by Holders
with Other Holders.


 


Holders may communicate pursuant to Section 312(b) of
the Trust Indenture Act with other Holders with respect to their rights under
this Indenture or the Securities.  The
Company, the Guarantor, the Trustee and any other Person shall have the
protection of Section 312(c) of the Trust Indenture Act.


 


ARTICLE EIGHT



SUCCESSOR CORPORATION


 


SECTION 801.          When Company or Guarantor May Merge
or Transfer Assets.


 


The Guarantor may not, and may not permit the
Company to, consolidate or amalgamate with or merge with or into any other
Person (other than a Subsidiary) or convey, transfer, sell or lease its properties
and assets substantially as an entirety to any Person (other than a Subsidiary),
or permit any Person (other than a Subsidiary) to consolidate with or merge
into the Guarantor or the Company, as the case may be, unless:


 


41

















 


(1)           either (a) the
Guarantor or the Company, as the case may be, shall be the surviving Person or (b) the
surviving Person (if other than the Guarantor or the Company, as the case may
be) shall (1) be a corporation or limited liability company organized and
existing under the laws of the United States of America, any state thereof, the
District of Columbia, Bermuda, the Cayman Islands or any country or state
which, on the date of this Indenture or on the date of such transaction, is a
member of the Organization for Economic Co-operation and Development and (2) expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form reasonably satisfactory to the Trustee, all of the obligations
of the Guarantor or the Company, as the case may be, under the Securities or
the Guarantee, as applicable, and this Indenture;


 


(2)           immediately after
giving effect to such transaction, no Event of Default, and no event that,
after notice or lapse of time or both, would become an Event of Default, shall
have occurred and be continuing; and


 


(3)           the Guarantor or the
Company, as the case may be, shall have delivered to the Trustee an Officers’
Certificate stating that such consolidation, merger, conveyance, transfer, sale
or lease and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture, comply with this Section 801 and
that all conditions precedent herein provided for relating to such transaction
have been satisfied.


 


The surviving Person of such transaction shall
succeed to, and be substituted for, and may exercise every right and power of,
the Guarantor or the Company, as the case may be, under this Indenture with the
same effect as if such successor had been named as the Guarantor or the
Company, as the case may be, herein; and thereafter, the Guarantor or the
Company, as the case may be, shall be discharged from all obligations and
covenants under this Indenture and the Securities or the Guarantee, as the case
may be.  Subject to Section 903, the
Company, the Trustee and the successor Person shall enter into a supplemental
indenture to evidence the succession and substitution of such successor Person
and such discharge and release of the Guarantor or the Company, as the case may
be.


 


ARTICLE NINE



AMENDMENTS & SUPPLEMENTAL INDENTURES


 


SECTION 901.          Amendments or Supplemental
Indentures without Consent of Holders.


 


The Company and the Guarantor, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may amend
or supplement this Indenture or the Securities or the Guarantees without the
consent of any Holder, so long as such changes (other than those in clause (1),
(2) or (7)) do not materially and adversely affect the interests of the
Holder:


 


(1)           to cure any
ambiguity, omission, defect or inconsistency; or


 


(2)           to make any
modifications or amendments that do not, in the good faith opinion of the
Company’s and the Guarantor’s respective Board of Directors and the Trustee,
adversely affect the interests of the Holders in any material respect; or


 


(3)           to provide for the
assumption of the Company’s or the Guarantor’s obligations under this Indenture
by a successor upon any merger, consolidation or asset transfer as permitted by
and in compliance with Article Eight of this Indenture; or


 


(4)           to provide any
security for or additional guarantees of the Securities; or


 


42





















 


(5)           to add Events of
Default with respect to the Securities; or


 


(6)           to add to the
Company’s or the Guarantor’s covenants for the benefit of the Holders or to
surrender any right or power conferred upon the Company or the Guarantor by
this Indenture; or


 


(7)           to make any change
necessary to comply with the Trust Indenture Act, or any amendment thereto, or
to comply with any requirement of the Commission in connection with the
qualification of the Indenture under the Trust Indenture Act, provided that
such modification or amendment does not, in the good faith opinion of the
Company’s and the Guarantor’s respective Board of Directors and the Trustee,
adversely affect the interests of the Holders of the Securities in any material
respect; or


 


(8)           to provide for
uncertificated Securities or Guarantees in addition to Certificated Securities
or Guarantees; or


 


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


 


(10)         to establish the form
or terms of Securities or the related Guarantees of any series as permitted by
Sections 201 and 301; or


 


(11)         to evidence and
provide for the acceptance of appointment hereunder by a successor Trustee with
respect to the Securities of one or more series and to add to or change any of
the provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 611(b).


 


SECTION 902.          Amendments or Supplemental
Indentures with Consent of Holders.


 


With the written consent of the Holders of not less
than a majority in aggregate principal amount of the Securities of such series
affected by such amendment or supplement at the time Outstanding, the Company
and the Guarantor, when authorized by a Board Resolution, and the Trustee, at
any time and from time to time, may amend or supplement this Indenture or such
series of Securities.  However, without
the consent of each Holder affected, an amendment to this Indenture or the
Securities may not (with respect to any Securities held by a non-consenting
Holder):


 


(1)           change the Stated
Maturity of the principal of, or any premium on, or any installment of interest
with respect to the Securities; or


 


(2)           reduce the principal
amount of, or the rate (or modify the calculation of such principal amount or
rate) of interest on, the Securities or any premium payable upon the redemption
thereof or otherwise change the redemption provisions thereof; or


 


(3)           change the currency
of payment of principal of or interest on the Securities; or


 


(4)           impair the right to
institute suit for the enforcement of any payment on or with respect to the
Securities; or


 


43





















 


(5)           reduce the
above-stated percentage of Holders of the Securities of any series necessary to
modify or amend this Indenture; or


 


(6)           if the Securities
are convertible, adversely affect the right of the Holders to convert Securities
other than as provided in or under this Indenture; or


 


(7)           release the
Guarantor from any of its obligations under its Guarantee or this Indenture
otherwise than in accordance with the terms of this Indenture; or


 


(8)           modify or make any
change to Article Fourteen or Article Fifteen of this Indenture (or
the related definitions) that adversely affects the rights of the Holders; or


 


(9)           modify the foregoing
requirements or reduce the percentage of Outstanding Securities necessary to
waive any covenant or past default.


 


It shall not be necessary for any Act of the Holders
under this Section 902 to approve the particular form of any proposed
amendment or supplemental indenture, but it shall be sufficient if such Act approves
the substance thereof.


 


After an amendment or supplemental indenture under
this Section 902 becomes effective, the Company and the Guarantor shall
mail to each Holder a notice briefly describing the amendment or supplemental
indenture.


 


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


 


SECTION 903.          Execution of Supplemental
Indentures.


 


The Trustee shall sign any supplemental indenture
authorized pursuant to this Article Nine if the amendment contained
therein does not adversely affect the rights, duties, liabilities or immunities
of the Trustee.  If it does, the Trustee
may, but need not, sign such supplemental indenture.  In executing, or accepting the additional trusts
created by, any supplemental indenture permitted by this Article Nine or
the modifications thereby of the trusts created by this Indenture, the Trustee
shall be entitled to receive, and (subject to Section 601) shall be fully
protected in relying upon, an Officers’ Certificate from each of the Company
and the Guarantor and an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture.


 


SECTION 904.          Effect of Supplemental
Indentures.


 


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


 


SECTION 905.          Conformity with Trust
Indenture Act.


 


Every supplemental indenture executed pursuant to
this Article Nine shall conform to the requirements of the Trust Indenture
Act as then in effect.


 


44

















 


SECTION 906.          Reference in Securities to
Supplemental Indentures.


 


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


 


ARTICLE TEN



COVENANTS


 


SECTION 1001.        Payment of Principal,
Premium and Interest.


 


The Company covenants and agrees for the benefit of
each series of Securities that it will duly and punctually pay the principal of
(and premium, if any) and interest on the Securities of that series in
accordance with the terms of the Securities and this Indenture.  Payment of principal (and premium, if any)
and interest on the Securities may be made at the option of the Company, either
by wire transfer or (subject to collection) by check mailed to the address of
the Person entitled thereto at such address as shall appear in the Security
Register or at the specified offices of any Paying Agent. The Guarantor covenants
that it will, as and when any amounts are due hereunder or under any Security,
duly and punctually pay such amounts as provided in the Guarantee.


 


SECTION 1002.        Maintenance of Office or
Agency.


 


The Company and the Guarantor will maintain in The
City of New York an office or agency where Securities of that series may be
presented or surrendered for registration of transfer or exchange and where
notices and demands to or upon the Company or the Guarantor in respect of the
Securities of that series and this Indenture may be served.  The Company and the Guarantor hereby
initially appoint the Trustee its office or agency for each of said
purposes.  The Company and the Guarantor
will give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. 
If at any time the Company or the Guarantor shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be
made or served at the Corporate Trust Office of the Trustee, each of the
Company and the Guarantor hereby appoints the Trustee as its agent to receive
all such presentations, surrenders, notices and demands.


 


The Company and the Guarantor may also from time to
time designate one or more other offices or agencies where the Securities of
one or more series may be presented or surrendered for any or all such purposes
and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
or the Guarantor of its obligation to maintain an office or agency in The City
of New York for such purposes.  The
Company and the Guarantor will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.


 


SECTION 1003.        Money for Securities;
Payments to Be Held in Trust.


 


If the Company shall at any time act as its own
Paying Agent with respect to any series of Securities, it will, on or before
each due date of the principal of (and premium, if any) or interest on any of
the 


 


45

















 


Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum (in the currency in which the Securities of such series are payable)
sufficient to pay the principal (and premium, if any) or interest so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided and will promptly notify the Trustee of its action or failure
so to act.


 


Whenever the Company or the Guarantor shall have one
or more Paying Agents for any series of Securities, it will, on or prior to the
day that is one Business Day preceding each due date of the principal of (and
premium, if any) or interest on any Securities of that series, deposit with a
Paying Agent a sum (in the currency in which the Securities of such series are
payable) sufficient to pay the principal (and premium, if any) or interest so
becoming due, such sum to be held in trust for the benefit of the Persons entitled
to such principal, premium or interest, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.


 


The Company or the Guarantor will cause each Paying
Agent for any series of Securities other than the Trustee to execute and
deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section 1003, that
such Paying Agent will:


 


(1)           hold all sums held
by it for the payment on the principal of (and premium, if any) or interest on
Securities of that series in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed of
as herein provided;


 


(2)           give the Trustee
notice of any default by the Company (or any other obligor upon the Securities
of that series including, without limitation, the Guarantor) in the making of
any payment of principal (and premium, if any) or interest on the Securities of
that series; and


 


(3)           at any time during
the continuance of any such default, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust by such Paying Agent.


 


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


 


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


 


46

















 


The Company shall have no obligation to make payment
of principal of (or premium, if any) or interest on any Security in immediately
available funds, except that if the Company shall have received original
payment for Securities in immediately available funds it shall make available
immediately available funds for payment of the principal of such Securities.


 


SECTION 1004.        Corporate Existence.


 


Except as otherwise permitted under Article Eight,
each of the Company and the Guarantor will do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence
and material rights (charter and statutory) and franchises; provided, however, that the Company and the Guarantor will
not be required to preserve any such right or franchise if its respective Board
of Directors or senior management of the Company or the Guarantor, as the case
may be, determines that the preservation thereof is no longer desirable in the
conduct of the business of the Company or the Guarantor and that the loss
thereof is not disadvantageous in any material respect to the Holders.


 


SECTION 1005.        Statement by Officers as
to Default.


 


The Company and the Guarantor will each deliver to
the Trustee, within 120 days after the end of each fiscal year of the Company
ending after the date hereof, a certificate of the principal executive officer,
principal financial officer or principal accounting officer of each of the
Company and the Guarantor stating whether or not to the best knowledge of the
signers thereof the Company or the Guarantor is in default in the performance
and observance of any of the terms, provisions and conditions of this Indenture,
and if the Company or the Guarantor shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.


 


SECTION 1006.        Waiver of Certain
Covenants.


 


In respect of any series of Securities, the Company
may omit in any particular instance to comply with any term, provision or
condition set forth in Section 1004 or 1005 (or any term, provision or
condition included in an indenture supplemental hereto or established pursuant
to a Board Resolution solely for the benefit of such series of Securities) if
before or after the time for such compliance the Holders of at least a majority
in principal amount of the Outstanding Securities of such series shall, by Act
of such Holders, either waive such compliance in such instance or generally
waive compliance with such term, provision or condition, and except to the
extent so expressly waived, and until such waiver shall become effective, the
obligations of the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and effect.


 


ARTICLE ELEVEN



REDEMPTION OF SECURITIES


 


SECTION 1101.        Applicability of Article.


 


Securities of any series which are redeemable before
their Stated Maturity shall be redeemable in accordance with their terms and
(except as otherwise specified as contemplated by Section 301 for Securities
of any series) in accordance with this Article Eleven.  In addition, unless expressly prohibited in
an indenture supplement hereto or in the Board Resolutions with respect to any
series of Securities, the Company may purchase, acquire or otherwise hold Securities.


 


47

















 


SECTION 1102.        Election to Redeem; Notice
to Trustee.


 


The election of the Company to redeem any Securities
shall be evidenced by a Board Resolution. 
In case of any redemption at the election of the Company of less than
all the Securities of any series, the Company and the Guarantor shall, at least
45 days prior to the Redemption Date fixed by the Company (unless a shorter
notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date and of the principal amount of Securities of such series to be redeemed,
such notice to be accompanied by a written statement signed by an authorized
officer of the Company and the Guarantor stating that no defaults in the
payment of interest or Events of Default with respect to the Securities of that
series have occurred (which have not been waived or cured).  In the case of any redemption of Securities
prior to the expiration of any restriction on such redemption provided in the
terms of such Securities or elsewhere in this Indenture, the Company and the
Guarantor shall furnish the Trustee an Officers’ Certificate evidencing
compliance with such restriction.


 


SECTION 1103.        Selection by Trustee of
Securities to Be Redeemed.


 


Other than as set forth in Section 1203, if
less than all the Securities of any series are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, as follows:


 


(i)            if the Securities are listed at such time on a national
securities exchange, either pro rata or by lot, or if such methods are not in
compliance with the requirements of such exchange, in compliance with the
requirements of such exchange, or


 


(ii)           if the Securities are not so listed, either pro rata or by
lot or by such method as the Trustee in its sole discretion shall deem fair and
appropriate and which may provide for the selection or redemption of portions
(equal to the minimum authorized denomination for Securities of that series or
any integral multiple thereof) of the principal amount of Securities of such
series of a denomination larger than the minimum authorized denomination for
Securities of that series.


 


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


 


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


 


SECTION 1104.        Notice of Redemption.


 


Notice of redemption shall be given from the
Company, the Guarantor or the Trustee by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each
Holder of Securities to be redeemed, at his address appearing in the Security
Register.  Any notice which is mailed in
the manner herein provided shall be conclusively presumed to have been duly
given, whether or not such Holder receives the notice.  Failure to give notice by mail, or any defect
in the notice to any such Holder in respect of any Security, shall not affect
the validity of the proceedings for the redemption of any other Security.


 


All notices of redemption shall state:


 


(1)           the Redemption Date;


 


48





















 


(2)           the Redemption Price
and any accrued interest;


 


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


 


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


 


(5)           the place or places
where such Securities are to be surrendered for payment of the Redemption Price
and any accrued interest;


 


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


 


(7)           the CUSIP number
and, if applicable, the ISIN number, of the Securities being redeemed.


 


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


 


SECTION 1105.        Deposit of Redemption
Price.


 


On or prior to the day that is one Business Day
preceding any Redemption Date, the Company or the Guarantor shall deposit with
the Trustee or with a Paying Agent (or, if the Company or the Guarantor is
acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003)
an amount of money in the currency of the applicable series, in funds
immediately available on the due date, sufficient to pay the Redemption Price
of, and (except if the Redemption Date shall be an Interest Payment Date)
accrued interest on, all the Securities which are to be redeemed on that date.


 


SECTION 1106.        Securities Payable on
Redemption Date.


 


Notice of redemption having been given as aforesaid,
the Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified together with accrued
interest thereon, and from and after such date (unless the Company or the
Guarantor shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest.  Upon surrender of any such Security for redemption
in accordance with said notice, such Security shall be paid by the Company at
the Redemption Price, together with accrued interest to the Redemption Date; provided, however, that installments of interest whose
Stated Maturity is on the Redemption Date shall be payable to the Holders of
such Securities, or one or more Predecessor Securities, registered as such at
the close of business on the relevant Record Dates according to their terms and
the provisions of Section 307.


 


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


 


The Trustee shall not redeem any Securities of any
series pursuant to this Article Eleven (unless all Outstanding Securities
of such series are to be redeemed) or mail or give any notice of redemption of
Securities during the continuance of an Event of Default hereunder known to the
Trustee with respect to such series, except that, where the mailing of notice
of redemption of any Securities shall theretofore have 


 


49

















 


been made, the Trustee shall
redeem or cause to be redeemed such Securities, provided that it shall have
received from the Company or the Guarantor a sum sufficient for such
redemption.  Except as aforesaid, any
moneys theretofore or thereafter received by the Trustee shall, during the continuance
of such Event of Default, be deemed to have been collected under Article Five
and held for the payment of all such Securities of such series.  In case such Event of Default shall have been
waived as provided in Section 513 or the default cured on or before the
sixtieth day preceding the Redemption Date, such moneys shall thereafter be
applied in accordance with the provisions of this Article Eleven.


 


SECTION 1107.        Securities Redeemed in
Part.


 


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


 


ARTICLE TWELVE


 


SINKING FUNDS


 


SECTION 1201.        Applicability of Article.


 


The provisions of this Article Twelve shall be
applicable to any sinking fund for the retirement of Securities of a series
except as otherwise specified as contemplated by Section 301 for
Securities of such series.


 


The minimum amount of any sinking fund payment provided
for by the terms of Securities of any series is herein referred to as a “mandatory
sinking fund payment,” and any payment in excess of such minimum amount
provided for by the terms of Securities of any series is herein referred to as
an “optional sinking fund payment.” If provided for by the terms of Securities
of any series, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 1202. 
Each sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of Securities of such
series.


 


SECTION 1202.        Satisfaction of Sinking
Fund Payments with Securities.


 


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


 


50
















 


SECTION 1203.     Redemption of Securities for Sinking Fund.


 


Not less than 60 days prior to each sinking fund
payment date for any series of Securities, the Company (1) will deliver to
the Trustee an Officers’ Certificate (A) stating that no defaults in the payment
of interest or Events of Default with respect to Securities of that series have
occurred (which have not been waived or cured), (B) specifying the amount
of the next ensuing sinking fund payment for that series pursuant to the terms
of Securities of that series, (C) stating whether or not the Company
intends to exercise its right, if any, to make an optional sinking fund payment
with respect to such series on the next ensuing sinking fund payment date and,
if so, specifying the amount of such optional sinking fund payment and (D) specifying
the portion of such sinking fund payment, if any, which is to be satisfied by
payment of cash and the portion thereof, if any, which is to be satisfied by
delivering and crediting Securities of that series pursuant to Section 1202
and (2) will also deliver to the Trustee any Securities to be so delivered.  Not less than 30 days before each such
sinking fund payment date the Trustee shall select the Securities of such
series to be redeemed upon such sinking fund payment date in the manner
specified in Section 1103 and cause notice of the redemption thereof to be
given in the name of and at the expense of the Company in the manner provided
in Section 1104.  Such notice having
been duly given, the redemption of such Securities shall be made upon the terms
and in the manner stated in Sections 1105, 1106 and 1107.  Failure of the Company, on or before any such
60th day, to deliver such Officers’ Certificate and Securities specified in
this Section 1203, if any, shall not constitute a default but shall
constitute, on and as of such date, the irrevocable election of the Company (a) that
the mandatory sinking fund payment for such series due on the next succeeding
sinking fund payment date shall be paid entirely in cash without the option to
deliver or credit Securities of such series in respect thereof and (b) that
the Company will make no optional sinking fund payment with respect to
Securities of such series as provided in this Article Twelve.


 


The Trustee shall not redeem or cause to be redeemed
any Security of a series with sinking fund moneys or mail any notice of
redemption of Securities of such series by operation of the sinking fund during
the continuance of a default in payment of interest on such Securities or of
any Event of Default with respect to such series except that, where the mailing
of notice of redemption of any Securities shall therefore have been made, the
Trustee shall redeem or cause to be redeemed such Securities, provided that it
shall have received from the Company a sum sufficient for such redemption.  Except as aforesaid, any moneys in the
sinking fund for such series at the time when any such default or Event of
Default shall occur, and any moneys thereafter paid into the sinking fund,
shall, during the continuance of such default or Event of Default, be deemed to
have been collected under Article Five and held for the payment of all
such Securities of such series.  In case
such Event of Default shall have been waived as provided in Section 513 or
the default cured on or before the 60th day preceding the sinking fund payment
date, such moneys shall thereafter be applied on the next succeeding sinking
fund payment date in accordance with this Section 1203 to the redemption
of such Securities.


 


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


 


ARTICLE THIRTEEN



GUARANTEE OF SECURITIES


 


SECTION 1301.        Unconditional Guarantee.


 


Subject to the provisions of this Article Thirteen
and Article Fifteen hereof, the Guarantor hereby unconditionally
guarantees, on an unsecured, subordinated basis, to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its
successors, irrespective of the validity and enforceability of this Indenture,
the Securities or the obligations of the Company to the Holders or the 


 


51

















 


Trustee hereunder or
thereunder, that:  (a) the principal
of (and premium, if any) and interest on the Securities will be duly and
punctually paid in full when due, whether at maturity, by acceleration, call
for redemption or otherwise and all obligations of the Company or the Guarantor
to the Holders or the Trustee hereunder or thereunder (including amounts due
the Trustee under Section 607 hereof) or under the Securities (including
fees, expenses or other disbursements) will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in
case of any extension of time of payment or renewal of any Securities or any of
such other obligations, the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
maturity, by acceleration, call for redemption, purchase or otherwise (all such
obligations guaranteed by the Guarantor, the “Guaranteed
Obligations”).  Failing
payment when due of any amount so guaranteed, or failing performance of any
other obligation of the Company to the Holders, for whatever reason, the
Guarantor will be obligated to pay, or to perform or cause the performance of
the same immediately.  An Event of Default
under this Indenture or the Securities shall constitute an event of default
under this Guarantee, and shall entitle the Holders of Securities or the
Trustee to accelerate the obligations of the Guarantor hereunder in the same
manner and to the same extent as the obligations of the Company.


 


The Guarantor agrees to pay any and all fees and
expenses (including reasonable attorney’s fees and expenses) incurred by the
Trustee or the Holders in enforcing any rights under this Article Thirteen
with respect to the Guarantor.


 


Without limiting the generality of the foregoing,
this Guarantee guarantees, to the extent provided herein, the payment of all
amounts that constitute part of the Guaranteed Obligations and would be owed by
the Company under this Indenture or the Securities but for the fact that they
are unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving the Company.


 


No stockholder, officer, director, employee or
incorporator, past, present or future, of the Guarantor, as such, shall have
any personal liability under this Guarantee by reason of his, her or its status
as such stockholder, officer, director, employee or incorporator.


 


The obligations of the Guarantor to the Holders and
to the Trustee pursuant to the Guarantee and this Indenture are expressly
subordinate and subject in right of payment to the prior payment in full of all
Guarantor Senior Indebtedness, to the extent and in the manner provided in Article Fifteen
hereof.


 


SECTION 1302.        Execution and Delivery of
Guarantee.


 


The Guarantee to be endorsed on the Securities
pursuant to Section 204 shall be deemed to include the terms of the
Guarantee set forth in this Article Thirteen.  The Guarantor hereby agrees to execute the
Guarantee in the form established pursuant to Section 204 to be endorsed
on each Security authenticated and delivered by the Trustee.


 


The Guarantee shall be executed on behalf of the
Guarantor by any one of the following individuals: its chairman of the Board of
Directors, a vice chairman, its president, treasurer, secretary or any of its
vice presidents.  The signature of any of
these individuals on the Guarantee may be manual or facsimile.


 


A Guarantee bearing the manual or facsimile
signature of an individual who was at any time the proper officer of the Guarantor
shall bind the Guarantor, notwithstanding that such individual has ceased to
hold such office prior to the authentication and delivery of the Security on
which the Guarantee is endorsed or did not hold such office at the date of the
Guarantee.


 


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The delivery of any Security by the Trustee after
the authentication thereof hereunder, shall constitute due delivery of the
Guarantee endorsed thereon on behalf of the respective Guarantor.  The Guarantor hereby agrees that the
Guarantee set forth in this Article Thirteen and in Section 204 shall
remain in full force and effect notwithstanding any failure to endorse a
Guarantee on any Security.


 


SECTION 1303.        Obligations of the
Guarantor Unconditional.


 


Nothing contained in this Article Thirteen or
elsewhere in this Indenture or in any Security is intended to or shall impair,
as between the Guarantor and the Holders and the Trustee, the obligation of the
Guarantor, which is absolute and unconditional, to pay to the Holders and the
Trustee the principal of (and premium, if any) and interest on the Securities
(and to the Trustee amounts due under Section 607) as and when the same
shall become due and payable in accordance with the provisions of this
Guarantee, nor shall anything herein or therein prevent the Trustee or any
Holder from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture.  Without
limiting the generality of the foregoing, it is agreed that the occurrence of
any one or more of the following shall not affect the liability of the
Guarantor hereunder:


 


(a)           the lack of validity, regularity or enforceability of this
Indenture or the Securities with respect to the Company or any agreement or
instrument relating thereto;


 


(b)           any change in the time, manner or place of payment of, or
in any other term of any of the Securities, or any other amendment or waiver of
or any consent to departure from this Indenture;


 


(c)           any amendment or modification of or deletion from or
addition or supplement to or other change in the Guarantee, the Indenture or
the Securities or any other instrument or agreement applicable to any of the
parties to the Guarantee, the Indenture or the Securities;


 


(d)           any furnishing or acceptance of any security or any
guarantee or other liability of any Subsidiary or any other party, or any
release of any security or any guarantee or other liability of any Subsidiary
or any other party, for the Guaranteed Obligations, or the failure of any
security or any guarantee or other liability of any Subsidiary or any other
party or the failure of any Person to perfect any interest in any collateral;


 


(e)           any failure, omission or delay on the part of the Company
to conform or comply with any term of the Indenture or the Securities or any
other instrument or agreement referred to in paragraph (a) above,
including, without limitation, failure to give notice to the Guarantor or the
Trustee of the occurrence of an Event of Default;


 


(f)            any waiver of the payment, performance or observance of
any of the obligations, conditions, covenants or agreements contained in the
Guarantee, the Indenture or the Securities, or any other waiver, consent,
extension indulgence, compromise settlement release or other action or inaction
under or in respect of the Guarantee, the Indenture or the Securities or any
other instrument or agreement referred to in paragraph (a) above or any
obligation or liability of the Company or any exercise or non-exercise of any
right, remedy, power or privilege under or in respect of any such instrument or
agreement or any such obligation or liability;


 


(g)           any failure, omission or delay on the part of the Trustee
or any Holder of Securities to enforce, assert, exercise or continue exercising
any right, power or remedy conferred on it in the Guarantee or the Indenture,
or any such failure, omission or delay on the part of the Trustee 


 


53

















 


or
any Holder of Securities in connection with the Guarantee, the Indenture or the
Securities, or any other action on the part of the Trustee or any Holder of
Securities;


 


(h)           the assignment of any right, title or interest of the
Trustee or any Holder in this Indenture or the Securities to any other Person;


 


(i)            any voluntary or involuntary bankruptcy, insolvency,
suspension of payments, reorganizations, arrangement, readjustment, assignment
for the benefit of creditors, receivership, liquidation or similar proceedings
with respect to the Company, the Guarantor or any other Person or any of their
respective properties or creditors, or any action taken by any trustee,
receiver or similar officer or by any court in any such proceeding;


 


(j)            any limitation on the liability or obligations of the
Company or any other Person under the Guarantee, the Indenture or the
Securities, or any partial discharge, cancellation or unenforceability of the
Guarantee, the Indenture or the Securities or any other agreement or instrument
referred to in paragraph (c) above or any term hereof, to the extent not
mutually agreed upon by the parties hereto;


 


(k)           any merger or consolidation of the Company or the
Guarantor into or with any other corporation or any sale, lease or transfer of
any of the assets of the Company or the Guarantor to any other Person;


 


(l)            any change in the ownership of any shares of Capital
Stock of the Guarantor, or any change in the corporate relationship between the
Company and the Guarantor, or any termination of such relationship, or any
change in the corporate existence, structure, or ownership of the Company;


 


(m)          any release or discharge, by operation of law, of the
Guarantor from the performance or observance of any obligation, covenant or
agreement contained in the Guarantee, the Indenture or the Securities;


 


(n)           any action, failure, omission or delay on the part of the
Trustee or any Holder of Securities that may impede any Guarantor from
acquiring or subrogating such Holders or Trustee’s rights or benefits; or


 


(o)           any other occurrence, circumstance, happening or event
whatsoever, whether similar or dissimilar to the foregoing, whether foreseen or
unforeseen, and any other circumstance that might otherwise constitute a legal
defense or discharge of the liabilities of the Guarantor or that might
otherwise limit recourse against the Guarantor; it being the intent of the
Guarantor that its obligations hereunder shall not be discharged except by
payment of all amounts owing pursuant to this Indenture or the Securities.


 


The Guarantee shall continue to be effective or be
reinstated, as the case may be, if at any time any payment or performance with
respect to any of the Securities is rescinded or must otherwise be returned by
the Trustee, any Holder or any other Person upon the insolvency, bankruptcy or
reorganization of the Company or otherwise, all as though such payment or
performance had not been made or occurred. 
In the event that any payment or any part thereof is rescinded or must
otherwise be returned, the Securities shall be reinstated and deemed reduced
only by such amount paid and not so rescinded or returned.  The obligations of the Guarantor under the
Guarantee shall not be subject to reduction, termination or other impairment by
any set-off, recoupment, counterclaim or defense or for any other reason.


 


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SECTION 1304.        Waivers.


 


The Guarantor hereby irrevocably waives, to the
extent permitted by applicable law:


 


(a)           promptness, demand for payment, diligence, presentment,
notice of acceptance and any other notice with respect to any of the Guaranteed
Obligations and the Guarantee;


 


(b)           any requirement that the Trustee, any Holder or any other
Person protect, secure, perfect or insure any Lien or any property subject
thereto or exhaust any right, sue or take any action against the Company or any
other Person, or obtain any relief pursuant to this Indenture or pursue any
other available remedy prior to making a claim against the Guarantor hereunder;


 


(c)           all right to trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Indenture or the Securities;


 


(d)           filing of claims with a court in the event of insolvency
or bankruptcy of the Company, any right to require a proceeding first against
the Company, protest or notice with respect to such Security or the
indebtedness evidenced thereby and all demands whatsoever;


 


(e)           any defense arising by reason of any claim or defense
based upon an election of remedies by the Trustee or any Holder that in any
manner impairs, reduces, releases or otherwise adversely affects its
subrogation, contribution or reimbursement rights or other rights to proceed
against the Company or any other Person;


 


(f)            any right to which it may be entitled to have the assets
of the Company first be used as payment of the Company’s or the Guarantor’s
obligations hereunder prior to any amounts being claimed from or paid by the
Guarantor hereunder; or


 


(g)           any duty on the part of the Trustee or any Holder to
disclose to the Guarantor any matter, fact or thing relating to the business,
operation or condition of the Company and its assets now known or hereafter
known by the Trustee or such Holder.


 


SECTION 1305.        Amendment, Etc.


 


No amendment, modification or waiver of any
provision of this Indenture relating to the Guarantor or consent to any departure
by the Guarantor or any other Person from any such provision will in any event
be effective unless it is signed by the Guarantor and the Trustee.


 


ARTICLE FOURTEEN


 


SUBORDINATION


 


SECTION 1401.        Agreement to Subordinate.


 


(a)           The
Company covenants and agrees, and each Holder of Securities issued hereunder by
such Holder’s acceptance thereof likewise covenants and agrees, that (except as
otherwise specified as contemplated by Section 301 for Securities of any
series) all Securities shall be issued subject to the provisions of this Article Fourteen;
and each Holder of a Security, whether upon original issue or upon transfer or
assignment thereof, accepts and agrees to be bound by such provisions.


 


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(b)           The
payment by the Company of the principal of (and premium, if any) and interest
on the Securities issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and junior in right of payment to the
prior payment in full of all Company Senior Indebtedness and other obligations,
(including, without limitation, insurance obligations and obligations with respect
to Policies and guarantees thereof) of the Company, whether outstanding at the
date of this Indenture or thereafter incurred.


 


(c)           No provision of this Article Fourteen
shall prevent the occurrence of any default or Event of Default hereunder.


 


SECTION 1402.        Default on Company Senior Indebtedness.


 


(a)           No
direct or indirect payment by or on behalf of the Company of principal of (and
premium, if any) or interest on the Securities, whether pursuant to the terms
of the Securities or upon acceleration, by way of repurchase, redemption,
defeasance or otherwise, will be made if, at the time of such payment, there
exists a default in the payment when due of all or any portion of the
obligations under or in respect of any Company Senior Indebtedness, whether at
maturity, on account of mandatory redemption or prepayment, acceleration or
otherwise, and such default shall not have been cured or waived or the benefits
of this sentence waived by or on of the holders of Company Senior Indebtedness.


 


(b)           In
addition, during the continuance of any nonpayment default or nonpayment Event
of Default with respect to any Company Senior Indebtedness pursuant to which
the maturity thereof may be accelerated, and upon receipt by the Trustee of
written notice (a “Payment Blockage Notice”)
from a holder or holders of such Company Senior Indebtedness or the trustee or
agent acting on behalf of such Company Senior Indebtedness, then, unless and
until such default or Event of Default has been cured or waived or has ceased
to exist or such Company Senior Indebtedness has been discharged or repaid in
full in cash, or the requisite holders of such Company Senior Indebtedness have
otherwise agreed in writing, no payment of any kind or character with respect
to any principal of or interest on or distribution will be made by or on behalf
of the Company on account of or with respect to the Securities, during a period
(a “Payment Blockage Period”) commencing on
the date of receipt of such Payment Blockage Notice by the Trustee and ending
179 days thereafter.


 


Notwithstanding anything herein to the contrary, (x) in
no event will a Payment Blockage Period extend beyond 179 days from the date
the Payment Blockage Notice in respect thereof was given and (y) there
must be 180 days in any 360-day period during which no Payment Blockage Period
is in effect.  Not more than one Payment
Blockage Period may be commenced with respect to the Securities during any
period of 360 consecutive days.  No
default or Event of Default that existed or was continuing on the date of
commencement of any Payment Blockage Period with respect to the Company Senior
Indebtedness initiating such Payment Blockage Period may be, or be made, the
basis for the commencement of any other Payment Blockage Period by the holder
or holders of such Company Senior Indebtedness or the trustee or agent acting
on behalf of such Company Senior Indebtedness, whether or not within a period
of 360 consecutive days, unless such default or Event of Default has been cured
or waived for a period of not less than 90 consecutive days.


 


(c)           In
the event that, notwithstanding the foregoing, any payment shall be received by
the Trustee when such payment is prohibited by the preceding paragraph of this Section 1402,
such payment shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Company Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Company Senior Indebtedness may have been
issued, as their respective interests may appear, as calculated by the Company,
to the extent necessary to pay such Company Senior Indebtedness in full, in
cash, after giving effect to any concurrent payment or


 


56





















 


distribution to or for the benefit of the holders of
such Company Senior Indebtedness, before any payment or distribution is made to
the Holders or to the Trustee.


 


SECTION 1403.        Liquidation; Dissolution; Bankruptcy.


 


(a)           Upon
any distribution of assets of the Company of any kind or character, whether in
cash, property or securities, to creditors upon any total or partial
dissolution, winding-up, liquidation or reorganization of the Company, whether
voluntary or involuntary, assignment for the benefit of creditors or
marshalling of the Company’s assets, or in bankruptcy, insolvency, receivership
or other similar proceedings, whether voluntary or involuntary, all principal,
premium, if any, and interest due or to become due on all Company Senior
Indebtedness shall first be paid in full in cash, or such payment duly provided
for to the satisfaction of the holders of the Company Senior Indebtedness,
before the Holders are entitled to receive or retain any payment; and upon any
such dissolution or winding-up or liquidation or reorganization, any payment by
the Company, or distribution of assets of the Company of any kind or character
whether in cash, property or securities, which the Holders or the Trustee would
be entitled to receive from the Company, except for the provisions of this Article Fourteen,
shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Holders or by the Trustee under this Indenture if received by them or
it, directly to the holders of Company Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Company Senior Indebtedness may have been
issued, as their respective interests may appear, as calculated by the Company,
to the extent necessary to pay such Company Senior Indebtedness in full in
cash, or such payment duly provided for to the satisfaction of the holders of
the Company Senior Indebtedness, after giving effect to any concurrent payment
or distribution to or for the benefit of the holders of such Company Senior
Indebtedness, before any payment or distribution is made to the Holders or to
the Trustee.


 


(b)           In
the event that, notwithstanding the foregoing, any payment or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, prohibited by the foregoing shall be received by the Trustee before
all Company Senior Indebtedness is paid in full, or provision is made for such
payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of such Company Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Company Senior Indebtedness may have been
issued, as their respective interests may appear, as calculated by the Company,
to the extent necessary to pay such Company Senior Indebtedness in full, in
cash, after giving effect to any concurrent payment or distribution to or for
the benefit of the holders of such Company Senior Indebtedness, before any
payment or distribution is made to the Holders or to the Trustee.


 


(c)           For
purposes of this Article Fourteen, the words “cash, property or securities”
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of which is subordinated
at least to the extent provided in this Article Fourteen with respect to
the Securities to the payment of all Company Senior Indebtedness that may at
the time be outstanding; provided, however, that
(i) such Company Senior Indebtedness is assumed by the new corporation, if
any, resulting from any such reorganization or readjustment, and (ii) the
rights of the holders of such Company Senior Indebtedness are not, without the
consent of such holders, altered by such reorganization or readjustment.  The amalgamation or consolidation of the
Company with, or the merger of the Company into, another corporation or the
liquidation or dissolution of the Company following the conveyance or transfer
of its properties or assets substantially as an entirety, to another
corporation upon the terms and conditions provided for in Article Eight of
this Indenture shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section 1403 if such other corporation
shall, as part of such


 


57





















 


amalgamation, consolidation, merger, conveyance or
transfer, comply with the conditions stated in Article Eight of this
Indenture.  Nothing in Section 1402
or in this Section 1403 shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 607 of this Indenture.


 


(d)           If
the Trustee or any Holder of Securities does not file a proper claim or proof
of debt in the form required in any proceeding referred to above prior to 30
days before the expiration of the time to file such claim in such proceeding,
then the holder of any Company Senior Indebtedness is hereby authorized, and
has the right, to file an appropriate claim or claims for or on behalf of such
Holder of Securities.


 


SECTION 1404.        Subrogation.


 


(a)           Subject
to the payment in full of all Company Senior Indebtedness then outstanding, the
rights of the Holders shall be subrogated to the rights of the holders of such
Company Senior Indebtedness to receive payments or distributions of cash,
property or securities of the Company applicable to such Company Senior
Indebtedness until the principal of and interest on the Securities shall be
paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of such Company Senior Indebtedness of any cash,
property or securities to which the Holders or the Trustee would be entitled
except for the provisions of this Article Fourteen, and no payment over
pursuant to the provisions of this Article Fourteen to or for the benefit
of the holders of such Company Senior Indebtedness by Holders or the Trustee,
shall, as between the Company, its creditors other than holders of Company Senior
Indebtedness, and the Holders, be deemed to be a payment by the Company to or on
account of such Company Senior Indebtedness. 
It is understood that the provisions of this Article Fourteen are
and are intended solely for the purposes of defining the relative rights of the
Holders, on the one hand, and the holders of such Company Senior Indebtedness,
on the other hand.


 


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


 


(c)           Upon
any payment or distribution of assets of the Company referred to in this Article Fourteen,
the Trustee, subject to the provisions of Section 601 of this Indenture,
and the Holders shall be entitled to rely conclusively upon any order or decree
made by any court of competent jurisdiction in which such dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidation trustee, agent
or other Person making such payment or distribution, delivered to the Trustee
or the Holders, for the purposes of ascertaining the Persons entitled to
participate in such distribution, the holders of Company Senior Indebtedness
and other indebtedness of the Company, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article Fourteen.


 


SECTION 1405.        Trustee to Effectuate Subordination.


 


Each Holder of Securities by such Holder’s acceptance
thereof authorizes and directs the Trustee on such Holder’s behalf to take such
action as may be necessary or appropriate to effectuate the


 


58

















 


subordination provided in
this Article Fourteen and appoints the Trustee such Holder’s
attorney-in-fact for any and all such purposes.


 


SECTION 1406.        Notice by the Company.


 


(a)           The
Company shall give prompt written notice to a Responsible Officer of the
Trustee of any fact known to the Company that would prohibit the making of any
payment of moneys to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article Fourteen. 
Notwithstanding the provisions of this Article Fourteen or any
other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts that would prohibit the making of any
payment of moneys to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article Fourteen, unless and until a Responsible
Officer of the Trustee shall have received written notice thereof from the
Company or a Holder or holders of Company Senior Indebtedness or from any
representative or trustee therefor; and before the receipt of any such written
notice, the Trustee, subject to the provisions of Section 601 of this
Indenture, shall be entitled 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 this Section 1406
at least two Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose (including, without limitation, the
payment of the principal of or interest on any Security), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power
and authority to receive such money and to apply the same to the purposes for
which such money was received, and shall not be affected by any notice to the
contrary that may be received by it within two Business Days prior to such
date.


 


(b)           The
Trustee, subject to the provisions of Section 601 of this Indenture, shall
be entitled to conclusively rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Company Senior Indebtedness (or a
trustee or representative on behalf of such holder) to establish that such
notice has been given by a holder of such Company Senior Indebtedness or a
trustee or representative on behalf of any such holder or holders.  In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
Person as a holder of such Company Senior Indebtedness to participate in any
payment or distribution pursuant to this Article Fourteen, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Company Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Fourteen and, if such evidence is not furnished,
the Trustee may defer any payment to such Person pending judicial determination
as to the right of such Person to receive such payment.


 


SECTION 1407.        Rights of the Trustee; Holders of
Company Senior Indebtedness.


 


(a)           The
Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article Fourteen in respect of any Company Senior
Indebtedness at any time held by it, to the same extent as any other holder of
Company Senior Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.


 


(b)           With
respect to the holders of Company Senior Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Fourteen and no implied covenants
or obligations with respect to the holders of such Company Senior Indebtedness
shall be read into this Indenture against the Trustee.  The Trustee shall not be deemed to owe any
fiduciary duty to the holders of such Company Senior Indebtedness and, subject
to the provisions of Section 601 of this Indenture, the Trustee shall not
be liable to any holder of such Company Senior Indebtedness if it shall pay
over or deliver to Holders, the Company or any other Person money or assets 


 


59





















 


to which any holder of such Company Senior
Indebtedness shall be entitled by virtue of this Article Fourteen or otherwise.


 


SECTION 1408.        Subordination May Not Be Impaired.


 


(a)           No
right of any present or future holder of any Company Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
otherwise be charged with.


 


(b)           Without
in any way limiting the generality of the foregoing paragraph, the holders of
Company Senior Indebtedness may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article Fourteen or the obligations
hereunder of the Holders to the holders of such Company Senior Indebtedness, do
any one or more of the following: (i) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, such Company
Senior Indebtedness, or otherwise amend or supplement in any manner such
Company Senior Indebtedness or any instrument evidencing the same or any
agreement under which such Company Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Company Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of such Company Senior
Indebtedness; and (iv) exercise or refrain from exercising or waive any
rights against the Company and any other Person.


 


(c)           Each
present and future holder of Company Senior Indebtedness shall be entitled to
the benefit of the provisions of this Article Fourteen notwithstanding
that such holder is not a party to this Indenture.


 


SECTION 1409.        Article Applicable to Paying
Agents.


 


In case at any time any Paying Agent other than the
Trustee shall have been appointed by the Company and be then acting hereunder,
the term “Trustee” as used in this Article Fourteen shall in such case
(unless the context otherwise requires) be construed as extending to and
including such Paying Agent within its meaning as fully for all intents and
purposes as if such Paying Agent were named in this Article Fourteen in
addition to or in place of the Trustee; provided,
however, that this Section 1409 shall not apply to the Company
or any Affiliate of the Company if it or such Affiliate acts as Paying Agent.


 


SECTION 1410.        Defeasance of This Article.


 


Notwithstanding anything contained herein to the
contrary, payments from cash or the proceeds of United States Government
Obligations held in trust under Article Four hereof by the Trustee (or
other qualifying trustee) and which were deposited in accordance with the terms
of Article Four hereof and not in violation of Section 1302 hereof
for the payment of principal of and interest on the Securities shall not be
subordinated to the prior payment of any Company Senior Indebtedness or subject
to the restrictions set forth in this Article Fourteen, and none of the
Holders shall be obligated to pay over any such amount to the Company or any
holder of Company Senior Indebtedness or any other creditor of the Company.


 


SECTION 1411.        Subordination Language to Be Included in
Securities.


 


Each Security shall contain a subordination
provision which will be substantially in the following form:


 


60
















 


 “The
Securities are subordinated in right of payment, in the manner and to the
extent set forth in the Indenture, to the prior payment in full of all Company
Senior Indebtedness (as defined in the Indenture, or as set forth in one or
more indentures supplemental thereto, a Board Resolution in accordance with Section 301
of the Indenture or in this Security). 
Each Holder by accepting a Security agrees to such subordination and authorizes
the Trustee to give it effect.”


 


ARTICLE FIFTEEN


 


SUBORDINATION OF GUARANTEE


 


SECTION 1501.        Agreement to Subordinate.


 


(a)           The
Guarantor covenants and agrees, and each Holder of Securities issued hereunder
by such Holder’s acceptance thereof likewise covenants and agrees, that (except
as otherwise specified as contemplated by Section 301 for Securities of
any series) the Guarantee shall be issued subject to the provisions of this Article Fifteen;
and each Holder of a Security, whether upon original issue or upon transfer or
assignment thereof, accepts and agrees to be bound by such provisions.


 


(b)           The
payment by the Guarantor of any of its obligations under the Guarantee
hereunder shall, to the extent and in the manner hereinafter set forth, be
subordinated and junior in right of payment to the prior payment in full of all
Guarantor Senior Indebtedness and other obligations, (including, without
limitation, insurance obligations and obligations with respect to Policies and
guarantees thereof) of the Guarantor, whether outstanding at the date of this
Indenture or thereafter incurred.


 


(c)           No provision of this Article Fifteen
shall prevent the occurrence of any default or Event of Default hereunder.


 


SECTION 1502.        Default on Guarantor Senior
Indebtedness.


 


(a)           No
direct or indirect payment by or on behalf of the Guarantor under the Guarantee,
whether pursuant to the terms of the Guarantee or upon acceleration, by way of
repurchase, redemption, defeasance or otherwise, will be made if, at the time
of such payment, there exists a default in the payment when due of all or any
portion of the obligations under or in respect of any Guarantor Senior Indebtedness,
whether at maturity, on account of mandatory redemption or prepayment,
acceleration or otherwise, and such default shall not have been cured or waived
or the benefits of this sentence waived by or on of the holders of Guarantor
Senior Indebtedness.


 


(b)           In
addition, during the continuance of any nonpayment default or nonpayment Event
of Default with respect to any Guarantor Senior Indebtedness pursuant to which
the maturity thereof may be accelerated, and upon receipt by the Trustee of
written notice (a “Guarantee Payment Blockage
Notice”) from a holder or holders of such Guarantor Senior
Indebtedness or the trustee or agent acting on behalf of such Guarantor Senior
Indebtedness, then, unless and until such default or Event of Default has been
cured or waived or has ceased to exist or such Guarantor Senior Indebtedness
has been discharged or repaid in full in cash, or the requisite holders of such
Guarantor Senior Indebtedness have otherwise agreed in writing, no payment of
any kind or character with respect to any principal of or interest on or
distribution will be made by or on behalf of the Guarantor on account of or
with respect to the Guarantee, during a period (a “Guarantee Payment
Blockage Period”) commencing on the date of receipt of such
Guarantee Payment Blockage Notice by the Trustee and ending 179 days thereafter.


 


Notwithstanding anything herein to the contrary, (x) in
no event will a Guarantee Payment Blockage Period extend beyond 179 days from
the date the Guarantee Payment Blockage Notice in respect 


 


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thereof was given and (y) there
must be 180 days in any 360-day period during which no Guarantee Payment
Blockage Period is in effect.  Not more
than one Guarantee Payment Blockage Period may be commenced with respect to the
Securities during any period of 360 consecutive days.  No default or Event of Default that existed
or was continuing on the date of commencement of any Guarantee Payment Blockage
Period with respect to the Guarantor Senior Indebtedness initiating such
Guarantee Payment Blockage Period may be, or be made, the basis for the
commencement of any other Guarantee Payment Blockage Period by the holder or holders
of such Guarantor Senior Indebtedness or the trustee or agent acting on behalf
of such Guarantor Senior Indebtedness, whether or not within a period of 360 consecutive
days, unless such default or Event of Default has been cured or waived for a
period of not less than 90 consecutive days.


 


(c)           In
the event that, notwithstanding the foregoing, any payment shall be received by
the Trustee when such payment is prohibited by the preceding paragraph of this Section 1502,
such payment shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Guarantor Senior Indebtedness or their
respective representatives, or to the trustee or trustees under any indenture
pursuant to which any instruments evidencing such Guarantor Senior Indebtedness
may have been issued, as their respective interests may appear, as calculated
by the Guarantor, to the extent necessary to pay such Guarantor Senior
Indebtedness in full, in cash, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Guarantor Senior
Indebtedness, before any payment or distribution is made to the Holders or to
the Trustee.


 


SECTION 1503.        Liquidation; Dissolution; Bankruptcy.


 


(a)           Upon
any distribution of assets of the Guarantor of any kind or character, whether
in cash, property or securities, to creditors upon any total or partial
dissolution, winding-up, liquidation or reorganization of the Guarantor,
whether voluntary or involuntary, assignment for the benefit of creditors or
marshalling of the Guarantor’s assets, or in bankruptcy, insolvency,
receivership or other similar proceedings, whether voluntary or involuntary,
all principal, premium, if any, and interest due or to become due on all
Guarantor Senior Indebtedness shall first be paid in full in cash, or such payment
duly provided for to the satisfaction of the holders of the Guarantor Senior
Indebtedness, before the Holders are entitled to receive or retain any payment;
and upon any such dissolution or winding-up or liquidation or reorganization,
any payment by the Guarantor, or distribution of assets of the Guarantor of any
kind or character whether in cash, property or securities, which the Holders or
the Trustee would be entitled to receive from the Guarantor, except for the
provisions of this Article Fifteen, shall be paid by the Guarantor or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Holders or by the Trustee under
this Indenture if received by them or it, directly to the holders of Guarantor
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing such
Guarantor Senior Indebtedness may have been issued, as their respective
interests may appear, as calculated by the Guarantor, to the extent necessary
to pay such Guarantor Senior Indebtedness in full in cash, or such payment duly
provided for to the satisfaction of the holders of the Guarantor Senior
Indebtedness, after giving effect to any concurrent payment or distribution to
or for the benefit of the holders of such Guarantor Senior Indebtedness, before
any payment or distribution is made to the Holders or to the Trustee.


 


(b)           In
the event that, notwithstanding the foregoing, any payment or distribution of
assets of the Guarantor of any kind or character, whether in cash, property or
securities, prohibited by the foregoing shall be received by the Trustee before
all Guarantor Senior Indebtedness is paid in full, or provision is made for
such payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of such Guarantor Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Guarantor Senior Indebtedness may have
been issued, as their 


 


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respective interests may appear, as calculated by
the Guarantor, to the extent necessary to pay such Guarantor Senior
Indebtedness in full, in cash, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Guarantor Senior
Indebtedness, before any payment or distribution is made to the Holders or to
the Trustee.


 


(c)           For
purposes of this Article Fifteen, the words “cash, property or securities”
shall not be deemed to include shares of stock of the Guarantor as reorganized
or readjusted, or securities of the Guarantor or any other corporation provided
for by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article Fifteen with
respect to the Guarantee to the payment of all Guarantor Senior Indebtedness
that may at the time be outstanding; provided,
however, that (i) such Guarantor Senior Indebtedness is assumed
by the new corporation, if any, resulting from any such reorganization or readjustment,
and (ii) the rights of the holders of such Guarantor Senior Indebtedness
are not, without the consent of such holders, altered by such reorganization or
readjustment.  The amalgamation or consolidation
of the Guarantor with, or the merger of the Guarantor into, another corporation
or the liquidation or dissolution of the Guarantor following the conveyance or
transfer of its properties or assets substantially as an entirety, to another
corporation upon the terms and conditions provided for in Article Eight of
this Indenture shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section 1503 if such other
corporation shall, as part of such amalgamation, consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article Eight
of this Indenture.  Nothing in Section 1502
or in this Section 1503 shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 607 of this Indenture.


 


(d)           If
the Trustee or any Holder of Securities does not file a proper claim or proof
of debt in the form required in any proceeding referred to above prior to 30
days before the expiration of the time to file such claim in such proceeding,
then the holder of any Guarantor Senior Indebtedness is hereby authorized, and
has the right, to file an appropriate claim or claims for or on behalf of such
Holder of Securities.


 


SECTION 1504.        Subrogation.


 


(a)           Subject
to the payment in full of all Guarantor Senior Indebtedness then outstanding,
the rights of the Holders shall be subrogated to the rights of the holders of
such Guarantor Senior Indebtedness to receive payments or distributions of
cash, property or securities of the Guarantor applicable to such Guarantor
Senior Indebtedness until the principal of and interest on the Securities shall
be paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of such Guarantor Senior Indebtedness of any cash,
property or securities to which the Holders or the Trustee would be entitled
except for the provisions of this Article Fifteen, and no payment over
pursuant to the provisions of this Article Fifteen to or for the benefit
of the holders of such Guarantor Senior Indebtedness by Holders or the Trustee,
shall, as between the Guarantor, its creditors other than holders of Guarantor
Senior Indebtedness, and the Holders, be deemed to be a payment by the
Guarantor to or on account of such Guarantor Senior Indebtedness.  It is understood that the provisions of this Article Fifteen
are and are intended solely for the purposes of defining the relative rights of
the Holders, on the one hand, and the holders of such Guarantor Senior
Indebtedness, on the other hand.


 


(b)           Nothing
contained in this Article Fifteen or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as between the Guarantor, its
creditors other than the holders of Guarantor Senior Indebtedness, and the
Holders, the obligation of the Guarantor, which is absolute and unconditional,
to comply with the terms for payment of the Guarantee, or is intended to or
shall affect the relative rights of the Holders and creditors of the Guarantor
other than the holders of Guarantor Senior Indebtedness nor shall anything
herein or therein prevent the Trustee or any Holder of Securities from
exercising all remedies otherwise permitted by applicable law upon default by
the Guarantor under its obligations 


 


63





















 


with respect to the Guarantee, subject to the
rights, if any, under this Article Fifteen of the holders of such
Guarantor Senior Indebtedness in respect of cash, property or securities of the
Guarantor received upon the exercise of any such remedy.


 


(c)           Upon
any payment or distribution of assets of the Guarantor referred to in this Article Fifteen,
the Trustee, subject to the provisions of Section 601 of this Indenture,
and the Holders shall be entitled to rely conclusively upon any order or decree
made by any court of competent jurisdiction in which such dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidation trustee, agent
or other Person making such payment or distribution, delivered to the Trustee
or the Holders, for the purposes of ascertaining the Persons entitled to
participate in such distribution, the holders of Guarantor Senior Indebtedness
and other indebtedness of the Guarantor, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article Fifteen.


 


SECTION 1505.        Trustee to Effectuate Subordination.


 


Each Holder of Securities by such Holder’s
acceptance thereof authorizes and directs the Trustee on such Holder’s behalf
to take such action as may be necessary or appropriate to effectuate the subordination
provided in this Article Fifteen and appoints the Trustee such Holder’s
attorney-in-fact for any and all such purposes.


 


SECTION 1506.        Notice by the Guarantor.


 


(a)           The
Guarantor shall give prompt written notice to a Responsible Officer of the
Trustee of any fact known to the Guarantor that would prohibit the making of
any payment of moneys to or by the Trustee in respect of the Guarantee pursuant
to the provisions of this Article Fifteen. 
Notwithstanding the provisions of this Article Fifteen or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment of
moneys to or by the Trustee in respect of the Guarantee pursuant to the
provisions of this Article Fifteen, unless and until a Responsible Officer
of the Trustee shall have received written notice thereof from the Guarantor or
a Holder or holders of Guarantor Senior Indebtedness or from any representative
or trustee therefor; and before the receipt of any such written notice, the
Trustee, subject to the provisions of Section 601 of this Indenture, shall
be entitled 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 this Section 1506 at
least two Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose (including, without limitation, the
payment of the principal of or interest on any Security), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power
and authority to receive such money and to apply the same to the purposes for
which such money was received, and shall not be affected by any notice to the
contrary that may be received by it within two Business Days prior to such
date.


 


(b)           The
Trustee, subject to the provisions of Section 601 of this Indenture, shall
be entitled to conclusively rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Guarantor Senior Indebtedness (or
a trustee or representative on behalf of such holder) to establish that such
notice has been given by a holder of such Guarantor Senior Indebtedness or a
trustee or representative on behalf of any such holder or holders.  In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
Person as a holder of such Guarantor Senior Indebtedness to participate in any
payment or distribution pursuant to this Article Fifteen, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Guarantor Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under 


 


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this Article Fifteen and, if such evidence is
not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.


 


SECTION 1507.        Rights of the Trustee; Holders of
Guarantor Senior Indebtedness.


 


(a)           The
Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article Fifteen in respect of any Guarantor Senior
Indebtedness at any time held by it, to the same extent as any other holder of
Guarantor Senior Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.


 


(b)           With
respect to the holders of Guarantor Senior Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Fifteen and no implied covenants or
obligations with respect to the holders of such Guarantor Senior Indebtedness
shall be read into this Indenture against the Trustee.  The Trustee shall not be deemed to owe any
fiduciary duty to the holders of such Guarantor Senior Indebtedness and,
subject to the provisions of Section 601 of this Indenture, the Trustee
shall not be liable to any holder of such Guarantor Senior Indebtedness if it
shall pay over or deliver to Holders, the Guarantor or any other Person money
or assets to which any holder of such Guarantor Senior Indebtedness shall be
entitled by virtue of this Article Fifteen or otherwise.


 


SECTION 1508.        Subordination May Not Be Impaired.


 


(a)           No
right of any present or future holder of any Guarantor Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the
Guarantor or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Guarantor with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof that any such
holder may have or otherwise be charged with.


 


(b)           Without
in any way limiting the generality of the foregoing paragraph, the holders of
Guarantor Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article Fifteen or the obligations
hereunder of the Holders to the holders of such Guarantor Senior Indebtedness,
do any one or more of the following: (i) change the manner, place or terms
of payment or extend the time of payment of, or renew or alter, such Guarantor
Senior Indebtedness, or otherwise amend or supplement in any manner such
Guarantor Senior Indebtedness or any instrument evidencing the same or any
agreement under which such Guarantor Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Guarantor Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of such Guarantor Senior
Indebtedness; and (iv) exercise or refrain from exercising or waive any
rights against the Guarantor and any other Person.


 


(c)           Each
present and future holder of Guarantor Senior Indebtedness shall be entitled to
the benefit of the provisions of this Article Fifteen notwithstanding that
such holder is not a party to this Indenture.


 


SECTION 1509.        Article Applicable to Paying
Agents.


 


In case at any time any Paying Agent other than the
Trustee shall have been appointed by the Guarantor and be then acting
hereunder, the term “Trustee” as used in this Article Fifteen shall in
such case (unless the context otherwise requires) be construed as extending to
and including such Paying Agent within its meaning as fully for all intents and
purposes as if such Paying Agent were named in this 


 


65

















 


Article Fifteen in
addition to or in place of the Trustee; provided,
however, that this Section 1509 shall not apply to the
Guarantor or any Affiliate of the Guarantor if it or such Affiliate acts as
Paying Agent.


 


SECTION 1510.        Defeasance of This Article.


 


Notwithstanding anything contained herein to the
contrary, payments from cash or the proceeds of United States Government
Obligations held in trust under Article Four hereof by the Trustee (or
other qualifying trustee) and which were deposited in accordance with the terms
of Article Four hereof and not in violation of Section 1302 hereof
for the payment of principal of and interest on the Securities shall not be
subordinated to the prior payment of any Guarantor Senior Indebtedness or
subject to the restrictions set forth in this Article Fifteen, and none of
the Holders shall be obligated to pay over any such amount to the Guarantor or
any holder of Guarantor Senior Indebtedness or any other creditor of the
Guarantor.


 


SECTION 1511.        Subordination Language to Be Included in
Guarantee.


 


The Guarantee shall contain a subordination
provision which will be substantially in the following form:


 


“This Guarantee is subordinated in right of payment,
in the manner and to the extent set forth in the Indenture, to the prior
payment in full of all Guarantor Senior Indebtedness (as defined in the Indenture,
or as set forth in one or more indentures supplemental thereto, a Board Resolution
in accordance with Section 301 of the Indenture or in this
Guarantee).  Each Holder by accepting
this Guarantee agrees to such subordination and authorizes the Trustee to give
it effect.”


 


 


[Signature page to follow]


 


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


 


 


	
   

  	
  ARCH
  CAPITAL GROUP (U.S.) INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME
  OF TRUSTEE]

  
	
   

  	
              as
  Trustee

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


67

















 


IN WITNESS WHEREOF, ARCH CAPITAL GROUP LTD., as
Guarantor, has caused this Indenture to be duly executed as a deed as of the
day and year first before written.


 


	
   

  	
  ARCH
  CAPITAL GROUP LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


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