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Exhibit 4.11  


        CONFORMED COPY 







 

LEVEL 3 COMMUNICATIONS, INC.,  


 as Guarantor,  


 LEVEL 3 FINANCING, INC.  


 as Issuer,  


 and  


 THE BANK OF NEW YORK,  


 as Trustee  




  
 
Indenture    
    
    Dated as of October 1, 2003    
    




10.750% Senior Notes Due 2011  


 



  





   TABLE OF CONTENTS  



	 
	 	 
	 	Page

	ARTICLE ONE

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
	

SECTION 101.	
 	

Definitions	
 	

1
	SECTION 102.	 	Compliance Certificates and Opinions	 	22
	SECTION 103.	 	Form of Documents Delivered to Trustee	 	22
	SECTION 104.	 	Acts of Holders	 	23
	SECTION 105.	 	Notices, etc., to Trustee and the Issuer	 	24
	SECTION 106.	 	Notice to Holders; Waiver	 	24
	SECTION 107.	 	Effect of Headings and Table of Contents	 	25
	SECTION 108.	 	Successors and Assigns	 	25
	SECTION 109.	 	Separability Clause	 	25
	SECTION 110.	 	Benefits of Indenture	 	25
	SECTION 111.	 	Governing Law	 	25
	SECTION 112.	 	Conflict with Trust Indenture Act	 	25
	SECTION 113.	 	Legal Holidays	 	25
	SECTION 114.	 	No Personal Liability of Directors, Officers, Employees and Stockholders	 	25
	SECTION 115.	 	Independence of Covenants	 	26
	SECTION 116.	 	Exhibits	 	26
	SECTION 117.	 	Counterparts	 	26
	SECTION 118.	 	Duplicate Originals	 	26
	

ARTICLE TWO

SECURITY FORMS
	

SECTION 201.	
 	

Form and Dating	
 	

26
	

ARTICLE THREE

THE SECURITIES
	

SECTION 301.	
 	

Amount of Securities	
 	

26
	SECTION 302.	 	Execution and Authentication	 	27
	SECTION 303.	 	Security Registrar and Paying Agent	 	27
	SECTION 304.	 	Paying Agent To Hold Money in Trust	 	28
	SECTION 305.	 	Holders Lists	 	28
	SECTION 306.	 	Replacement Securities	 	28
	SECTION 307.	 	Temporary Securities	 	28
	SECTION 308.	 	Cancellation	 	28
	SECTION 309.	 	Defaulted Interest	 	29
	SECTION 310.	 	CUSIP Numbers	 	29
	

ARTICLE FOUR

SATISFACTION AND DISCHARGE
	

SECTION 401.	
 	

Satisfaction and Discharge of Indenture	
 	

29
	SECTION 402.	 	Application of Trust Money	 	30
	 	 	 	 	 





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ARTICLE FIVE

REMEDIES
	

SECTION 501.	
 	

Events of Default	
 	

30
	SECTION 502.	 	Acceleration of Maturity; Rescission and Annulment	 	31
	SECTION 503.	 	Collection of Indebtedness and Suits for Enforcement by Trustee	 	32
	SECTION 504.	 	Trustee May File Proofs of Claim	 	32
	SECTION 505.	 	Trustee May Enforce Claims Without Possession of Securities	 	33
	SECTION 506.	 	Application of Money Collected	 	33
	SECTION 507.	 	Limitation on Suits	 	33
	SECTION 508.	 	Unconditional Right of Holders to Receive Principal, Premium and Interest	 	34
	SECTION 509.	 	Restoration of Rights and Remedies	 	34
	SECTION 510.	 	Rights and Remedies Cumulative	 	34
	SECTION 511.	 	Delay or Omission Not Waiver	 	34
	SECTION 512.	 	Control by Holders	 	34
	SECTION 513.	 	Waiver of Past Defaults	 	34
	SECTION 514.	 	Waiver of Stay or Extension Laws	 	35
	SECTION 515.	 	Undertaking for Costs	 	35
	

ARTICLE SIX

THE TRUSTEE
	

SECTION 601.	
 	

Certain Duties and Responsibilities	
 	

35
	SECTION 602.	 	Notice of Default	 	36
	SECTION 603.	 	Certain Rights of Trustee	 	36
	SECTION 604.	 	Trustee Not Responsible for Recitals or Issuance of Securities	 	37
	SECTION 605.	 	May Hold Securities	 	38
	SECTION 606.	 	Money Held in Trust	 	38
	SECTION 607.	 	Compensation and Reimbursement	 	38
	SECTION 608.	 	Corporate Trustee Required; Eligibility; Conflicting Interests	 	38
	SECTION 609.	 	Resignation and Removal; Appointment of Successor	 	39
	SECTION 610.	 	Acceptance of Appointment by Successor	 	40
	SECTION 611.	 	Merger, Conversion, Consolidation or Succession to Business	 	40
	

ARTICLE SEVEN

HOLDERS' LISTS AND REPORTS BY TRUSTEE AND THE ISSUER
	

SECTION 701.	
 	

Disclosure of Names and Addresses of Holders	
 	

40
	SECTION 702.	 	Reports by Trustee	 	41
	SECTION 703.	 	Reports by Parent and the Issuer	 	41
	

ARTICLE EIGHT

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
	

SECTION 801.	
 	

Parent May Consolidate, etc., Only on Certain Terms	
 	

41
	SECTION 802.	 	Successor Parent Substituted	 	42
	SECTION 803.	 	Issuer May Consolidate, etc., Only on Certain Terms	 	42
	SECTION 804.	 	Successor Issuer Substituted	 	43
	SECTION 805.	 	Guarantor (other than Parent) May Consolidate, etc., Only on Certain Terms	 	43
	SECTION 806.	 	Successor Guarantor Substituted	 	44
	SECTION 807.	 	Offering Proceeds Note Guarantor May Consolidate, etc., Only on Certain Terms	 	44
	 	 	 	 	 



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ARTICLE NINE

SUPPLEMENTAL INDENTURES
	

SECTION 901.	
 	

Supplemental Indentures Without Consent of Holders	
 	

45
	SECTION 902.	 	Supplemental Indentures With Consent of Holders	 	46
	SECTION 903.	 	Execution of Supplemental Indentures	 	47
	SECTION 904.	 	Effect of Supplemental Indentures	 	47
	SECTION 905.	 	Conformity with Trust Indenture Act	 	47
	SECTION 906.	 	Reference in Securities to Supplemental Indentures	 	47
	SECTION 907.	 	Notice of Supplemental Indentures	 	47
	

ARTICLE TEN

COVENANTS
	

SECTION 1001.	
 	

Payment of Principal, Premium, if Any, and Interest	
 	

48
	SECTION 1002.	 	Maintenance of Office or Agency	 	48
	SECTION 1003.	 	Money for Security Payments to Be Held in Trust	 	48
	SECTION 1004.	 	Corporate Existence	 	49
	SECTION 1005.	 	Maintenance of Properties	 	49
	SECTION 1006.	 	Insurance	 	50
	SECTION 1007.	 	Reports	 	50
	SECTION 1008.	 	Statement by Officers as to Default	 	50
	SECTION 1009.	 	Change of Control Triggering Event	 	50
	SECTION 1010.	 	Limitation on Consolidated Debt	 	52
	SECTION 1011.	 	Limitation on Debt of the Issuer and Issuer Restricted Subsidiaries	 	55
	SECTION 1012.	 	Limitation on Restricted Payments	 	58
	SECTION 1013.	 	Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries	 	60
	SECTION 1014.	 	Limitation on Liens	 	61
	SECTION 1015.	 	Limitation on Sale and Leaseback Transactions	 	62
	SECTION 1016.	 	Limitation on Asset Dispositions	 	63
	SECTION 1017.	 	Limitation on Issuance and Sales of Capital Stock of Restricted Subsidiaries	 	65
	SECTION 1018.	 	Transactions with Affiliates	 	65
	SECTION 1019.	 	Limitation on Designations of Unrestricted Subsidiaries	 	66
	SECTION 1020.	 	Limitation on Actions with respect to Existing Intercompany Obligations	 	67
	SECTION 1021.	 	Covenant Suspension	 	68
	SECTION 1022.	 	Special Interest Notice	 	69
	

ARTICLE ELEVEN

REDEMPTION OF SECURITIES
	

SECTION 1101.	
 	

Right of Redemption	
 	

70
	SECTION 1102.	 	Applicability of Article	 	70
	SECTION 1103.	 	Election to Redeem; Notice to Trustee	 	70
	SECTION 1104.	 	Selection by Trustee of Securities to Be Redeemed	 	70
	SECTION 1105.	 	Notice of Redemption	 	70
	SECTION 1106.	 	Deposit of Redemption Price	 	71
	SECTION 1107.	 	Securities Payable on Redemption Date	 	71
	SECTION 1108.	 	Securities Redeemed in Part	 	71
	 	 	 	 	 





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ARTICLE TWELVE

DEFEASANCE AND COVENANT DEFEASANCE
	

SECTION 1201.	
 	

Issuer's Option to Effect Defeasance or Covenant Defeasance	
 	

72
	SECTION 1202.	 	Defeasance and Discharge	 	72
	SECTION 1203.	 	Covenant Defeasance	 	72
	SECTION 1204.	 	Conditions to Defeasance or Covenant Defeasance	 	73
	SECTION 1205.	 	Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions	 	74
	SECTION 1206.	 	Reinstatement	 	74
	

ARTICLE THIRTEEN

GUARANTEES AND OFFERING PROCEEDS NOTE GUARANTEES
	

SECTION 1301.	
 	

Guarantees	
 	

75
	SECTION 1302.	 	Contribution	 	76
	SECTION 1303.	 	Release of Guarantees	 	76
	SECTION 1304.	 	Successors and Assigns	 	76
	SECTION 1305.	 	No Waiver	 	76
	SECTION 1306.	 	Modification	 	77
	SECTION 1307.	 	Execution of Supplemental Indenture for Future Guarantors	 	77
	SECTION 1308.	 	Subordination of Note Guarantees	 	77
	SECTION 1309.	 	Execution of Offering Proceeds Note Guarantees for Future Offering Proceeds Note Guarantors; Subordination of Offering Proceeds Note Guarantee	 	77





	APPENDIX A	 	—	 	Provisions Relating to Initial Securities and Exchange Securities
	EXHIBIT A	 	—	 	Form of Exchange Security
	EXHIBIT B	 	—	 	Form of Incumbency Certificate
	EXHIBIT C	 	—	 	Form of Supplemental Indenture
	EXHIBIT D	 	—	 	Form of Subordination Agreement
	EXHIBIT E	 	—	 	Form of Offering Proceeds Note Guarantee




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        INDENTURE, dated as of October 1, 2003, among Level 3 Communications, Inc., a corporation duly organized and existing under the laws of the State of Delaware (herein called
"Parent"), having its principal office at 1025 Eldorado Boulevard, Broomfield, Colorado 80021, Level 3 Financing, Inc. (the Issuer"), having its principal office at 1025 Eldorado Boulevard,
Broomfield, Colorado 80021, and The Bank of New York, a New York banking corporation, as Trustee (herein called the "Trustee"). 


RECITALS OF THE ISSUER  


        The Issuer has duly authorized the creation of an issue of 10.750% Senior Notes Due 2011 (the "Initial Securities") and, if and when issued pursuant to a
Registered Exchange Offer or Private Exchange Offer pursuant to a Registration Agreement for the Initial Securities, 10.750% Senior Notes Due 2011 (the "Exchange Securities" and, together with the
Initial Securities, the "Securities"), of substantially the tenor and amount hereinafter set forth, and to provide therefor the Issuer and Parent have duly authorized the execution and delivery of
this Indenture. 


        All
things necessary have been done to make the Securities, when executed by the Issuer and authenticated and delivered hereunder and duly issued by the Issuer, the valid obligations of
the Issuer and to make this Indenture a valid agreement of each of Parent, the Issuer and the Trustee, in accordance with their and its terms. 


        Simultaneously
with the closing of the offering of the Initial Securities, the Issuer will lend the net proceeds of the issuance of the Securities and certain cash on hand to Level 3 LLC
in return for the Offering Proceeds Note. Currently, Level 3 LLC is the obligor on the Parent Intercompany Note. Pursuant to the Subordination Agreement, Level 3 LLC's obligations under the Parent
Intercompany Note will be subordinated to its obligations under the Offering Proceeds Note upon the limited circumstances set forth therein. As set forth herein, under certain
circumstances, Restricted Subsidiaries will be required to enter into a Note Guarantee and an Offering Proceeds Note Guarantee and subordinate certain intercompany obligations to their
obligations under such guarantee pursuant to the Subordination Agreement. 


        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, as follows: 


ARTICLE ONE  


 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION  


        SECTION 101. Definitions.


        For
all purposes of this Indenture, including the recitals set forth above, except as otherwise expressly provided or unless the context otherwise requires: 



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


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


        (c)   all
accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles, and, except as
otherwise herein expressly provided, the term "generally accepted accounting principles" with respect to any computation required or permitted hereunder shall mean United States generally accepted
accounting principles as in effect on the date of this Indenture; 


        (d)   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, paragraph
or other subdivision; 






 




        (e)   unless
otherwise indicated, references to Articles, Sections, paragraphs or other subdivisions are references to such Articles, Sections, paragraphs or other
subdivisions of this Indenture; and 


        (f)    "or"
is not exclusive and "including" means including without limitation. 




        "Accreted
Value" of any Debt issued at a price less than the principal amount at stated maturity, means, as of any date of determination, an amount equal to the sum of (a) the
issue price of such Debt as determined in accordance with Section 1273 of the Code or any successor provisions plus (b) the aggregate of the portions of the original issue discount (the
excess of the amounts considered as part of the "stated redemption price at maturity" of such Debt within the meaning of Section 1273(a)(2) of the Code or any successor provisions,
whether denominated as principal or interest, over the issue price of such Debt) that shall theretofore have accrued pursuant to Section 1272 of the Code (without regard to
Section 1272(a)(7) of the Code) from the date of issue of such Debt to the date of determination, minus all amounts theretofore paid in respect of such Debt, which amounts are considered
as part of the "stated redemption price at maturity" of such Debt within the meaning of Section 1273(a)(2) of the Code or any successor provisions (whether such amounts paid were denominated
principal or interest). 


        "Acquired
Debt" means, with respect to any specified Person, (i) Debt of any other Person existing at the time such Person merges with or into or consolidates with or becomes a
Subsidiary of such specified Person and (ii) Debt secured by a Lien encumbering any Property acquired by such specified Person, which Debt was not incurred in anticipation of, and was
outstanding prior to, such merger, consolidation or acquisition. 


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


        "Additional
Securities" means, subject to the Issuer's compliance with the covenants in this Indenture, including Section 1010 and Section 1011, 10.750% Senior Notes due
2011 issued from time to time after the Issue Date under the terms of this Indenture (other than pursuant to Section 306, 307, 1016 or 1108 of this Indenture and other than Exchange Securities
or Private Exchange Securities issued pursuant to an exchange offer for other Securities outstanding under this Indenture). 


        "Affiliate"
of any Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such Person. For the purposes of this
definition, "control" when used with respect to any 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. For purposes of Sections 1016 and 1018 and the definition of
"Telecommunications/IS Assets" only, "Affiliate" shall also mean any beneficial owner of shares representing 10% or more of the total voting power of the Voting Stock (on a fully diluted basis) of
Parent or of rights or warrants to purchase such Voting Stock (whether or not currently exercisable) and any Person who would be an Affiliate of any such beneficial owner pursuant to the first
sentence hereof. 


        "Affiliate
Transaction" has the meaning specified in Section 1018. 


        "Agent
Member" has the meaning specified in Section 2.1(b) of Appendix A. 


        "Asset
Disposition" means any transfer, conveyance, sale, lease, issuance or other disposition by Parent or any Restricted Subsidiary in one or more related transactions (including a
consolidation or merger or other sale of any such Restricted Subsidiary with, into or to another Person in a transaction in which such Restricted Subsidiary ceases to be a Restricted Subsidiary of
Parent, but excluding a disposition by a Restricted Subsidiary to Parent or a Restricted Subsidiary or by Parent to a Restricted Subsidiary) of (i) shares of Capital Stock or other ownership
interests of a Restricted Subsidiary (other than as permitted by clause (v), (vi), (vii) or (ix) of Section 1017), (ii) substantially all of the assets of 


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Parent
or any Restricted Subsidiary representing a division or line of business or (iii) other Property of Parent or any Restricted Subsidiary outside of the ordinary course of business
(excluding any transfer, conveyance, sale, lease or other disposition of equipment that is obsolete or no longer used by or useful to Parent; provided,  however, that Parent has delivered to the Trustee an Officers' Certificate stating that such criteria are satisfied);  provided in each case that the aggregate consideration for such transfer, conveyance,
 sale, lease or other disposition is equal to $5,000,000 or more in
any 12-month period. The following shall not be Asset Dispositions: (i) Permitted Telecommunications Capital Asset Dispositions that comply with clause (i) of the
first paragraph of Section 1016, (ii) when used with respect to Parent, any Asset Disposition permitted pursuant to Article Eight which constitutes a disposition of all or
substantially all of the assets of Parent and the Restricted Subsidiaries taken as a whole, (iii) Receivables sales constituting Debt under Qualified Receivable Facilities permitted to be
Incurred pursuant to Section 1010 or Section 1011 and (iv) any disposition that constitutes a Permitted Investment or a Restricted Payment permitted by Section 1012. 


        "Attributable
Value" means, as to any particular lease under which any Person is at the time liable other than a Capital Lease Obligation, and at any date as of which the amount thereof
is to be determined, the total net amount of rent required to be paid by such Person under such lease during the remaining term thereof (including any period for which such lease has been extended) as
determined in accordance with generally accepted accounting principles, discounted from the last date of such remaining term to the date of determination at a rate per annum equal to the discount rate
which would be applicable to a Capital Lease Obligation with like term in accordance with generally accepted accounting principles. The net amount of rent required to be paid under any such lease for
any such period shall be the aggregate amount of rent payable by the lessee with respect to such period after excluding amounts required to be paid on account of insurance, taxes, assessments,
utility, operating and labor costs and similar charges. In the case of any lease which is terminable by the lessee upon the payment of penalty, such net amount shall also include the lesser of the
amount of such penalty (in which case no rent shall be considered as required to be paid under such lease subsequent to the first date upon which it may be so terminated) or the rent which would
otherwise be required to be paid if such lease is not so terminated. "Attributable Value" means, as to a Capital Lease Obligation, the principal amount thereof. 


        "Board
of Directors" of any Person means the board of directors of such Person. 


        "Board
Resolution" of any Person means a copy of a resolution certified by the Secretary or an Assistant Secretary of such Person to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification, and delivered to the Trustee. 



        "Business
Day" means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in The City of New York are authorized or obligated by law or
executive order to close. 


        "Capital
Lease Obligation" of any Person means the obligation to pay rent or other payment amount under a lease of (or other Debt arrangements conveying the right to use) Property of
such Person which is required to be classified and accounted for as a capital lease or a liability on the face of a balance sheet of such Person in accordance with generally accepted accounting
principles (a "Capital Lease"). The stated maturity of such obligation shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such
lease may be terminated by the lessee without payment of a penalty. The principal amount of such obligation shall be the capitalized amount thereof that would appear on the face of a balance sheet of
such Person in accordance with generally accepted accounting principles. 


        "Capital
Stock" of any Person means any and all shares, interests, participations or other equivalents (however designated) of corporate stock or other equity participations, including
partnership interests, whether general or limited, of such Person and any rights (other than debt 


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securities
convertible or exchangeable into an equity interest), warrants or options to acquire an equity interest in such Person. 


        "Cash
Equivalents" means (i) Government Securities maturing, or subject to tender at the option of the holder thereof, within two years after the date of acquisition
thereof, (ii) time deposits and certificates of deposit of any commercial bank organized in the United States having capital and surplus in excess of $500,000,000 or a commercial bank organized
under the law of any other country that is a member of the OECD having total assets in excess of $500,000,000 (or its foreign currency equivalent at the time) with a maturity date not more than one
year from the date of acquisition, (iii) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (i) above
entered into with (x) any bank meeting the qualifications specified in clause (ii) above or (y) any primary government securities dealer reporting to the Market Reports
Division of the Federal Reserve Bank of New York, (iv) direct obligations issued by any state of the United States of America or any political subdivision of any such state or any public
instrumentality thereof maturing, or subject to tender at the option of the holder thereof, within 90 days after the date of acquisition thereof;  provided, however, that at the time of acquisition, the long-term debt of such state,
political subdivision or public instrumentality has a rating of A (or higher) from S&P or A-2 (or higher) from Moody's (or, if at any time neither S&P nor Moody's shall be rating such
obligations, then an
equivalent rating from such other nationally recognized rating service acceptable to the Trustee), (v) commercial paper issued by the parent corporation of any commercial bank organized in the
United States having capital and surplus in excess of $500,000,000 or a commercial bank organized under the laws of any other country that is a member of the OECD having total assets in excess of
$500,000,000 (or its foreign currency equivalent at the time), and commercial paper issued by others having one of the two highest ratings obtainable from either S&P or Moody's (or, if at any time
neither S&P nor Moody's shall be rating such obligations, then from such other nationally recognized rating service acceptable to the Trustee) and in each case maturing within one year after the date
of acquisition, (vi) overnight bank deposits and bankers' acceptances at any commercial bank organized in the United States having capital and surplus in excess of $500,000,000 or a commercial
bank organized under the laws of any other country that is a member of the OECD having total assets in excess of $500,000,000 (or its foreign currency equivalent at the time), (vii) deposits
available for withdrawal on demand with a commercial bank organized in the United States having capital and surplus in excess of $500,000,000 or a commercial bank organized under the laws of any other
country that is a member of the OECD having total assets in excess of $500,000,000 (or its foreign currency equivalent at the time) and (viii) investments in money market funds substantially
all of whose assets comprise securities of the types described in clauses (i) through (vii). 


        "Change
of Control" has the meaning specified in Section 1009. 


        "Change
of Control Triggering Event" has the meaning specified in Section 1009. 


        "Code"
means the Internal Revenue Code of 1986, as amended. 


        "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 Indenture such
Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time. 


        "Common
Stock" of any Person means Capital Stock of such Person that does not rank prior, as to the payment of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to shares of Capital Stock of any other class of such Person. 


        "Consolidated
Capital Ratio" means as of the date of determination the ratio of (i) the aggregate amount of Debt of Parent and its Restricted Subsidiaries on a consolidated basis
as at the date of 


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determination
to (ii) the sum of (a) $2,024,000,000, (b) the aggregate net proceeds to Parent from the issuance or sale of any Capital Stock (including Preferred Stock) of Parent
other than Disqualified Stock subsequent to the Measurement Date, (c) the aggregate net proceeds from the issuance or sale of Debt of Parent or any Restricted Subsidiary subsequent to the
Measurement Date convertible or exchangeable into Capital Stock of Parent other than Disqualified Stock, in each case upon conversion or exchange thereof into Capital Stock of Parent subsequent to the
Measurement Date and (d) the after-tax gain on the sale, subsequent to the Measurement Date, of Special Assets to the extent such Special Assets have been sold for cash, Cash
Equivalents, Telecommunications/IS Assets or the assumption of Debt of Parent or any Restricted Subsidiary (other than Debt that is subordinated to the Securities or any applicable
Note Guarantee or Offering Proceeds Note Guarantee) and release of Parent and all Restricted Subsidiaries from all liability on the Debt assumed;  provided, however, that, for purposes of calculation of the Consolidated Capital Ratio, the net proceeds
from the issuance or sale of Capital Stock or Debt described in clause (b) or (c) above shall not be included to the extent (x) such proceeds have been utilized to make a
Permitted Investment under clause (i) of the definition thereof or a Restricted Payment or (y) such Capital Stock or Debt shall have been issued or sold to Parent, a Subsidiary of
Parent or an employee stock ownership plan or trust established by Parent or any such Subsidiary for the benefit of their employees. 


        "Consolidated
Cash Flow Available for Fixed Charges" for Parent and its Restricted Subsidiaries or for the Issuer and the Issuer Restricted Subsidiaries for any period means the
Consolidated Net Income of Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries, as applicable, for such period increased by the sum of, to the extent reducing
such Consolidated Net Income for such period, (i) Consolidated Interest Expense of Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries, as applicable,
for such period, plus (ii) Consolidated Income Tax Expense of Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries, as applicable, for such period, plus
(iii) consolidated depreciation and amortization expense and any other non-cash items (other than any such non-cash item to the extent that it represents an accrual of
or reserve for cash expenditures in any future period) for Parent and its Restricted Subsidiaries or for the Issuer and the Issuer Restricted Subsidiaries, as applicable;  provided, however, that there shall be excluded therefrom the Consolidated Cash Flow Available for Fixed
Charges (if positive) of any Restricted Subsidiary or Issuer Restricted Subsidiary, as applicable (calculated separately for such Restricted Subsidiary or Issuer Restricted Subsidiary in the same
manner as provided above for Parent or the Issuer, as applicable) that is subject to a restriction which prevents the payment of dividends or the making of distributions to Parent or another
Restricted Subsidiary or to the Issuer or another Issuer Restricted Subsidiary, as applicable, to the extent of such restrictions. 


        "Consolidated
Income Tax Expense" for Parent and its Restricted Subsidiaries or for the Issuer and the Issuer Restricted Subsidiaries for any period means the aggregate amounts of the
provisions for income taxes of Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries, as applicable, for such period calculated on a consolidated basis in
accordance with generally accepted accounting principles. 


        "Consolidated
Interest Expense" for Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries for any period means the interest expense included in a
consolidated income statement (excluding interest income) of Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries, as applicable, for such period in accordance
with generally accepted accounting principles, including without limitation or duplication (or, to the extent not so included, with the addition of), (i) the amortization of Debt discounts and
issuance costs, including commitment fees; (ii) any payments or fees with respect to letters of credit, bankers' acceptances or similar facilities; (iii) net costs with respect to
interest rate swap or similar agreements or foreign currency hedge, exchange or similar agreements (including fees); (iv) Preferred Stock Dividends (other than dividends paid in shares of
Preferred Stock that is not Disqualified Stock) declared and paid or 


5





 

payable;
(v) accrued Disqualified Stock Dividends, whether or not declared or paid; (vi) interest on Debt guaranteed by Parent and its Restricted Subsidiaries or the Issuer and the
Issuer Restricted Subsidiaries, as applicable; (vii) the portion of any Capital Lease Obligation or Sale and Leaseback Transaction paid during such period that is allocable to interest expense;
(viii) interest Incurred in connection with investments in discontinued operations; and (ix) the cash contributions to any employee stock ownership plan or similar trust to the extent
such contributions are used by such plan or trust to pay interest or fees to any Person (other than Parent or a Restricted Subsidiary or the Issuer or an Issuer Restricted Subsidiary, as applicable)
in connection with Debt Incurred by such plan or trust. 


        "Consolidated
Net Income" for Parent and its Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries for any period means the net income (or loss) of Parent and its
Restricted Subsidiaries or the Issuer and the Issuer Restricted Subsidiaries, as applicable, for such period determined on a consolidated basis in accordance with generally accepted accounting
principles; provided, however, that there shall be excluded therefrom (a) for purposes of
Section 1012 only, the net income (or loss) of any Person acquired by Parent or a Restricted Subsidiary or the Issuer or an Issuer Restricted Subsidiary, as applicable, in a
pooling-of-interests transaction for any period prior to the date of such transaction, (b) the net income (or loss) of any Person that is not a Restricted Subsidiary or
an Issuer Restricted Subsidiary, as applicable, except to the extent of the amount of dividends or other distributions actually paid to Parent or a Restricted Subsidiary or to the Issuer or an Issuer
Restricted Subsidiary, as applicable, by such Person during such period (except, for purposes of Section 1012 only, to the extent such dividends or distributions have been subtracted from the
calculation of the amount of Investments to support the actual making of Investments), (c) gains or losses realized upon the sale or other disposition of any Property of Parent or its
Restricted Subsidiaries or the Issuer or the Issuer Restricted Subsidiaries, as applicable, that is not sold or disposed of in the ordinary course of business (it being understood that Permitted
Telecommunications Capital Asset Dispositions shall be considered to be in the ordinary course of business), (d) gains or losses realized upon the sale or other disposition of any Special
Assets, (e) all extraordinary gains and extraordinary losses, determined in accordance with generally accepted accounting principles, (f) the cumulative effect of changes in accounting
principles, (g) non-cash gains or losses resulting from fluctuations in currency exchange rates, (h) any non-cash expense related to the issuance to employees or
directors of Parent or any Restricted Subsidiary or the Issuer or any Issuer Restricted Subsidiary, as applicable, of (1) options to purchase Capital Stock of Parent or such Restricted
Subsidiary or the Issuer or such Issuer Restricted Subsidiary, as applicable, or (2) other compensatory rights; provided, in either case, that
such options or rights, by their terms can be redeemed at the option of the holder of such option or right only for Capital Stock, (i) with respect to a Restricted Subsidiary or an Issuer
Restricted Subsidiary, as applicable, that is not a Wholly Owned
Subsidiary any aggregate net income (or loss) in excess of Parent's or any Restricted Subsidiary's or the Issuer's or any Issuer Restricted Subsidiary's, as applicable, pro rata share of the net
income (or loss) of such Restricted Subsidiary or Issuer Restricted Subsidiary, as applicable, that is not a Wholly Owned Subsidiary and (j) if the period is the second, third or fourth fiscal
quarter of 2003 or the first fiscal quarter of 2004, an aggregate of $293,686,650 for all such quarters (such amount relating to communications revenues recognized by Parent and its Subsidiaries in
connection with the amendment in February 2003 of the 1998 Cost Sharing and IRU Agreement with XO Communications); provided further that there
shall further be excluded therefrom the net income (but not net loss) of any Restricted Subsidiary or any Issuer Restricted Subsidiary, as applicable, that is subject to a restriction which prevents
the payment of dividends or the making of distributions to Parent or another Restricted Subsidiary or to the Issuer or another Issuer Restricted Subsidiary, as applicable, to the extent of such
restriction. 


        "Consolidated
Net Worth" of any Person means the stockholders' equity of such Person, determined on a consolidated basis in accordance with generally accepted accounting principles, less
amounts attributable to Disqualified Stock of such Person. 


6





 



        "Consolidated
Tangible Assets" of any Person means the total amount of assets (less applicable reserves and other properly deductible items) which under generally accepted accounting
principles would be included on a consolidated balance sheet of such Person and its Subsidiaries after deducting therefrom all goodwill, trade names, trademarks, patents, unamortized debt discount and
expense and other like intangibles, which in each case under generally accepted accounting principles would be included on such consolidated balance sheet. 


        "Corporate
Trust Office" means the principal corporate trust office of the Trustee, at which at any particular time its corporate trust business shall be administered, which office at
the date of execution of this Indenture is located at 101 Barclay Street, Floor 8 West, New York, New York 10286, except that, with respect to presentation of Securities for payment or for
registration of transfer or exchange, such term shall mean the office or agency of the Trustee at which, at any particular time, its corporate agency business shall be conducted. 


        "Credit
Facilities" means one or more credit agreements, loan agreements or similar facilities, secured or unsecured, providing for revolving credit loans, term loans and/or letters of
credit, including any Qualified Receivable Facility, entered into from time to time by Parent and its Restricted Subsidiaries, or Purchase Money Debt, or Debt Incurred pursuant to Capital Lease
Obligations, Sale and Leaseback Transactions, or senior secured note issuances, and including any related notes, Guarantees, collateral documents, instruments and agreements executed in connection
therewith, as the same may be amended, supplemented, modified, restated or replaced from time to time. 


        "Debt"
means (without duplication), with respect to any Person, whether recourse is to all or a portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed, (ii) every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments, including obligations incurred in
connection with the acquisition of Property, (iii) every reimbursement obligation of such Person with respect to letters of credit, bankers' acceptances or similar facilities issued for the
account of such Person, (iv) every obligation of such Person issued or assumed as the deferred purchase price of Property or services (including securities repurchase agreements but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of business), (v) every Capital Lease Obligation of such Person and all Attributable Value in respect of Sale and
Leaseback Transactions entered into by such Person, (vi) all obligations to redeem or repurchase Disqualified Stock issued by such Person, (vii) the liquidation preference of any
Preferred Stock (other than Disqualified Stock, which is covered by the preceding clause (vi)) issued by any Restricted Subsidiary of such Person, (viii) every obligation under Interest
Rate or Currency Protection Agreements of such Person and (ix) every obligation of the type referred to in clauses (i) through (viii) of another Person and all dividends of
another Person the payment of which, in either case, such Person has Guaranteed. The "amount" or "principal amount" of Debt at any time of determination as used herein represented by (a) any
Debt issued at a price that is less than the principal amount at maturity thereof, shall be, except as otherwise set forth herein, the Accreted Value of such Debt at such time or (b) in the
case of any Receivables sale constituting Debt, the amount of the unrecovered purchase price (that is, the amount paid for Receivables that has not been actually recovered from the collection of such
Receivables) paid by the purchaser (other than Parent or a Wholly Owned Restricted Subsidiary of Parent) thereof. The amount of Debt represented by an obligation under an Interest Rate or Currency
Protection Agreement shall be equal to (x) zero if such obligation has been Incurred pursuant to clause (x) of paragraph (b) of Section 1010 or
clause (viii) of paragraph (b) of Section 1011 or (y) the notional amount of such obligation if not Incurred pursuant to such clause. 


        "Default"
means any event, act or condition the occurrence of which is, or after notice or the passage of time or both would be, an Event of Default. 


        "Depository"
means The Depository Trust Company, its nominees and successors. 


7





 



        "Designation"
and "Designation Amount" have the respective meanings specified in Section 1019. 


        "Disqualified
Stock" of any Person means any Capital Stock of such Person which, by its terms (or by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in
whole or in part, on or prior to the final Stated Maturity of the Securities; provided, however, that
any Preferred Stock which would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require
Parent or the Issuer, respectively, to repurchase or redeem such Preferred Stock upon the occurrence of a change of control occurring prior to the final Stated Maturity of the Securities shall not
constitute Disqualified Stock if the change of control provisions applicable to such Preferred Stock are no more favorable to the holders of such Preferred Stock than the provisions applicable to the
Securities contained in Section 1009 and such Preferred Stock specifically provides that Parent or the Issuer, respectively, will not repurchase or redeem any such stock pursuant to such
provisions prior to the Issuer's repurchase of such Securities as are required to be repurchased pursuant to Section 1009. 



        "Disqualified
Stock Dividends" means all dividends with respect to Disqualified Stock of Parent held by Persons other than a Wholly Owned Restricted Subsidiary. The amount of any such
dividend shall be equal to the quotient of such dividend divided by the difference between one and the maximum statutory federal income tax rate (expressed as a decimal number between 1 and
0) applicable to Parent for the period during which such dividends were paid. 


        "Domestic
Restricted Subsidiary" means any Restricted Subsidiary other than (a) a Foreign Restricted Subsidiary or (b) a Subsidiary of a Foreign Restricted Subsidiary. 


        "Event
of Default" has the meaning specified in Section 501. 


        "Exchange
Act" means the Securities Exchange Act of 1934, as amended (or any successor act), and the rules and regulations thereunder (or respective successors thereto). 


        "Exchange
Securities" has the meaning stated in the first recital of this Indenture. 


        "Excess
Proceeds" has the meaning specified in Section 1016. 


        "Existing
Notes" means Parent's 27/8% Convertible Senior Notes due 2010 in an aggregate principal amount not to exceed $373,750,000, 11% Senior Notes due 2008 in an
aggregate principal amount not to exceed $800,000,000, 111/4% Senior Notes due 2010 in an aggregate principal amount not to exceed $250,000,000, 127/8% Senior Discount
Notes due 2010 in an aggregate principal amount at maturity not to exceed $675,000,000, 103/4% Senior Notes due 2008 in an aggregate principal amount not to exceed
€500,000,000, 111/4% Senior Notes due 2010 in an aggregate principal amount not to exceed €300,000,000, 91/8% Senior Notes due 2008 in an
aggregate principal amount not to exceed $2,000,000,000, 101/2% Senior Discount Notes due 2008 in an aggregate principal amount at maturity not to exceed $833,815,000, 6% Convertible
Subordinated Notes due 2009 in an aggregate principal amount not to exceed $823,000,000 and 6% Convertible Subordinated Notes due 2010 in an aggregate principal amount not to exceed $862,500,000. 


        "Expiration
Date" has the meaning specified in "Offer to Purchase" below. 


        "Fair
Market Value" means, with respect to any Property, the price that could be negotiated in an arm's-length free market transaction, for cash, between a willing seller and a willing
buyer, neither of whom is under pressure or compulsion to complete the transaction. Unless otherwise specified herein, Fair Market Value shall be determined by the Board of Directors of Parent acting
in good faith and shall be evidenced by a Board Resolution of Parent (except in the case of the last paragraph under Section 1016) delivered to the Trustee. 


8





 



        "Federal
Bankruptcy Code" means the Bankruptcy Act of Title 11 of the United States Code, as amended from time to time. 


        "Foreign
Restricted Subsidiary" means any Restricted Subsidiary that is not organized under the laws of the United States of America or any State thereof or the District of Columbia. 



        "Global
Security" means a Rule 144A Global Security or a Regulation S Global Security, as the case may be. 


        "Government
Securities" means direct obligations of, or obligations fully and unconditionally guaranteed or insured by, the United States of America or any agency or instrumentality
thereof for the payment of which obligations or guarantee the full faith and credit of the United States is pledged and which are not callable or redeemable at the issuer's option (unless, for
purposes of the definition of "Cash Equivalents" only, the obligations are redeemable or callable at a price not less than the purchase price paid by Parent or the applicable Restricted Subsidiary,
together with all accrued and unpaid interest (if any) on such Government Securities). 



        "Guarantee"
by any Person means any obligation, direct or indirect, contingent or otherwise, of such Person guaranteeing, or having the economic effect of guaranteeing, any Debt of any
other Person (the "primary obligor") in any manner, whether directly or indirectly, and any obligation, direct or indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt or to purchase (or to advance or supply funds for the purchase of) any security for the payment of such Debt, including any such
obligations arising by virtue of partnership arrangements or by agreements to keep-well, (ii) to purchase Property or services or to take-or-pay for the
purpose of assuring the holder of such Debt of the payment of such Debt, (iii) to maintain working capital, equity capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Debt or (iv) entered into for the purpose of assuring in any other manner the obligee against loss in
respect thereof, in whole or in part (and "Guaranteed", "Guaranteeing" and "Guarantor" shall have meanings correlative to the foregoing); provided,  however,
 that the Guarantee by any Person shall not include endorsements by such Person for collection or deposit, in either case, in the ordinary
course of business. 


        "Guarantor"
means (1) Parent and (2) any other Person that becomes a Guarantor pursuant to Section 1010, Section 1011, Article Eight or any other
provision of this Indenture. 


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


        "Incur"
means, with respect to any Debt or other obligation of any Person, to create, issue, incur (by conversion, exchange or otherwise), assume, Guarantee or otherwise become liable in
respect of such Debt or other obligation including the recording, as required pursuant to generally accepted accounting principles or otherwise, of any such Debt or other obligation on the balance
sheet of such Person (and "Incurrence", "Incurred" and "Incurring" shall have meanings correlative to the foregoing); provided,  however, that a change in
generally accepted accounting principles that results in an obligation of such Person that exists at such time becoming Debt
shall not be deemed an Incurrence of such Debt and that neither the accrual of interest nor the accretion of original issue discount shall be deemed an Incurrence of Debt. Debt otherwise incurred by a
Person before it becomes a Subsidiary of Parent shall be deemed to have been Incurred at the time at which it becomes a Subsidiary. 


        "Indenture"
means this instrument as originally executed and as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to
the applicable provisions hereof. 


        "Initial
Foreign Purchaser" means each non-U.S. person (within the meaning of Regulation S) that purchased Initial Securities from the Initial Purchasers in offshore
transactions meeting the requirements of Regulation S. 


9







   
        "Initial Purchasers" means Citigroup Global Markets Inc., Credit Suisse First Boston LLC, J.P. Morgan Securities Inc., Morgan Stanley & Co. Incorporated and UBS
Warburg LLC. 


        "Initial
Securities" has the meaning stated in the first recital of this Indenture. 


        "Interest
Payment Date" means the Stated Maturity of an installment of interest on the Securities. 



        "Interest
Rate or Currency Protection Agreement" of any Person means any forward contract, futures contract, swap, option or other financial agreement or arrangement (including caps,
floors, collars and similar agreements) relating to, or the value of which is dependent upon, interest rates or currency exchange rates or indices. 


        "Invested
Capital" means the sum of (a) $500,000,000, (b) the aggregate net proceeds received by Parent from the issuance or sale of any Capital Stock, including Preferred
Stock, of Parent but excluding Disqualified Stock, subsequent to the Measurement Date, and (c) the aggregate net proceeds from the issuance or sale of Debt of Parent or any Restricted
Subsidiary subsequent to the Measurement Date convertible or exchangeable into Capital Stock of Parent other than Disqualified Stock, in each case upon conversion or exchange thereof into Capital
Stock of Parent subsequent to the Measurement Date; provided, however, that the net proceeds from the
issuance or sale of Capital Stock or Debt described in clause (b) or (c) shall be excluded from any computation of Invested Capital to the extent (i) utilized to make a
Restricted Payment or (ii) such Capital Stock or Debt shall have been issued or sold to Parent, a Subsidiary of Parent or an employee stock ownership plan or trust established by Parent or any
such Subsidiary for the benefit of their employees. 


        "Investment"
by any Person means any direct or indirect loan, advance or other extension of credit or capital contribution (by means of transfers of cash or other Property to others or
payments for Property or services for the account or use of others, or otherwise) to, purchase, redemption, retirement or acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Debt issued by, or Incurrence of, or payment on, a Guarantee of any obligation of, any other Person; provided,  however, that Investments shall
exclude commercially reasonable extensions of trade credit. The amount, as of any date of determination, of any
Investment shall be the original cost of such Investment, plus the cost of all additions, as of such date, thereto and  minus the amount, as of such date,
of any portion of such Investment repaid to such Person in cash as a repayment of principal or a return of capital,
as the case may be (except to the extent such repaid amount has been included in Consolidated Net Income of Parent and its Restricted Subsidiaries to support the actual making of Restricted Payments),
but without any other adjustments for increases or decreases in value, or write-ups, write-
downs or write-offs with respect to such Investment. In determining the amount of any Investment involving a transfer of any Property other than cash, such Property shall be valued at its
Fair Market Value at the time of such transfer. 


        "Investment
Grade Rating" means a rating equal to or higher that Baa3 (or the equivalent) by Moody's and BBB- (or the equivalent) by S&P. 


        "Issuer"
means the Person named as "Issuer" 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 "Issuer" shall mean such successor Person. 


        "Issue
Date" means the date on which the Original Securities are initially issued. 


        "Issue
Date Purchase Money Debt" means Purchase Money Debt outstanding on the Issue Date; provided,  however, that the amount of such Purchase Money Debt when
Incurred did not exceed 100% of the cost of the construction, installation, acquisition,
lease, development or improvement of the applicable Telecommunications/IS Assets. 


        "Issue
Date Rating" means Caa2 in the case of Moody's and CCC- in the case of S&P, which are the respective ratings assigned to the Securities by the Rating Agencies on the
Issue Date. 


10





 



        "Issuer
Debt Ratio" means the ratio of (a) the aggregate consolidated principal amount (or, in the case of Debt issued at a discount, the then-Accreted Value) of Debt
of the Issuer and the Issuer Restricted Subsidiaries (other than Debt owed to Parent or a Sister Restricted Subsidiary that is subordinated to the Offering Proceeds Note (if Level 3 LLC is the
obligor on such Debt) or to an Offering Proceeds Note Guarantee of the obligor on such Debt), on a consolidated basis, outstanding as of the most recent available quarterly or annual balance
sheet, after giving pro forma effect to the proposed Incurrence of Debt giving rise to such calculation and any other Debt Incurred or repaid since such balance sheet date and the receipt and
application of the net proceeds thereof, to (b) the sum of, without duplication, (x) Consolidated Cash Flow Available for Fixed Charges of the Issuer and the Issuer Restricted
Subsidiaries for the four full fiscal quarters next preceding such proposed Incurrence of Debt for which consolidated financial statements are available and (y) Consolidated Cash Flow Available
for Fixed Charges of Parent and the Sister Restricted Subsidiaries to the extent attributable to Sister Restricted Subsidiaries that are Guarantors for such four full fiscal quarters. 


        "Issuer
Order" or "Issuer Request" means a written request or order signed in the name of the Issuer by the Chairman of the Board of Directors, a Vice Chairman of the Board of Directors,
the President or a Vice President, and by the Chief Financial Officer, the Chief Accounting Officer, the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of
the Issuer, and delivered to the Trustee. 


        "Issuer
Restricted Subsidiaries" means the Subsidiaries of the Issuer that are Restricted Subsidiaries. 


        "Joint
Venture" means a Person in which Parent or a Restricted Subsidiary holds not more than 50% of the shares of Voting Stock. 


        "Level
3 LLC" means Level 3 Communications, LLC, a Delaware limited liability company and a direct Wholly Owned Subsidiary of the Issuer. 


        "Lien"
means, with respect to any Property, any mortgage or deed of trust, pledge, hypothecation, assignment, deposit arrangement, security interest, lien, charge, easement (other than
any easement not materially impairing usefulness), encumbrance, preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever on or with respect to such
Property (including any Capital Lease Obligation, conditional sale or other title retention agreement having substantially the same economic effect as any of the foregoing and any Sale and Leaseback
Transaction). For purposes of this definition the sale, lease, conveyance or other transfer by Parent or any of its Subsidiaries of, including the grant of indefeasible rights of use or equivalent
arrangements with respect to, dark or lit communications fiber capacity or communications conduit shall not constitute a Lien. For the sake of clarity, subordination and setoff rights do not
constitute Liens. 


        "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, notice of redemption or otherwise. 


        "Measurement
Date" means April 28, 1998. 


        "Moody's"
means Moody's Investors Service, Inc. or, if Moody's Investors Service, Inc. shall cease rating debt securities having a maturity at original issuance of at least
one year and such ratings business shall have been transferred to a successor Person, such successor Person; provided,  however, that if Moody's Investors
Service, Inc. ceases rating debt securities having a maturity at original issuance of at least one year and
its ratings business with respect thereto shall not have been transferred to any successor Person, then "Moody's" shall mean any other national recognized rating agency (other than S&P) that rates
debt securities having a maturity at original issuance of at least one year and that shall have been designated by the Trustee by a written notice given to the Issuer. 


11





 



        "Net
Available Proceeds" from any Asset Disposition by any Person means cash or cash equivalents received (including amounts received by way of sale or discounting of any note,
installment receivable or other receivable, but excluding any other consideration received in the form of assumption by the acquirer of Debt or other obligations relating to such Property) therefrom
by such Person, net of (i) all legal, title and recording taxes, expenses and commissions and other fees and expenses (including appraisals, brokerage commissions and investment banking fees)
Incurred and all federal, state, provincial, foreign and local taxes required to be accrued as a liability as a consequence of such Asset Disposition, (ii) all payments made by such Person or
its Subsidiaries on any Debt which is secured by such Property in accordance with the terms of any Lien upon or with respect to such Property or which must by the terms of such Lien, or in order to
obtain a necessary consent to such Asset Disposition or by applicable law, be repaid out of the proceeds from such Asset Disposition, (iii) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or Joint Ventures of such Person as a result of such Asset Disposition and (iv) appropriate amounts to be provided by such Person or any
Subsidiary thereof, as the case may be, as a reserve in accordance with generally accepted accounting principles against any liabilities associated with such Property and retained by such Person or
any Subsidiary thereof, as the case may be, after such Asset Disposition, including liabilities under any indemnification obligations and severance and other employee termination costs associated with
such Asset Disposition, in each case as determined by the Board of Directors of such Person, in its reasonable good faith judgment evidenced by a Board Resolution filed with the Trustee;  provided,
however, that any reduction in such reserve within twelve months following the
consummation of such Asset Disposition will be, for all purposes of this Indenture and the Securities, treated as a new Asset Disposition at the time of such reduction with Net Available Proceeds
equal to the amount of such reduction; provided further, however, that, in the event that any
consideration for a transaction (which would otherwise constitute Net Available Proceeds) is required to be held in escrow pending determination of whether a purchase price adjustment will be made, at
such time as such portion of the consideration is released to such Person or its Restricted Subsidiary from escrow, such portion shall be treated for all purposes of this Indenture and the Securities
as a new Asset Disposition at the time of such release from escrow with Net Available Proceeds equal to the amount of such portion of consideration released from escrow. 



        "Non-Telecommunications
Subsidiary" means any Issuer Restricted Subsidiary not engaged in any material respect in the Telecommunications/IS Business. 


        "Note Guarantee"
means an unconditional Guarantee of the due and punctual payment of the principal of and premium, if any, and interest on the Securities, when and as due, whether
at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and all other monetary obligations of the Issuer under this Indenture and the Securities, and the due and punctual
performance of all covenants, agreements, obligations and liabilities of the Issuer under or pursuant to this Indenture and the Securities, including the Parent Guarantee. 


        "Offer"
has the meaning specified in "Offer to Purchase" below. 


        "Offer
to Purchase" means a written offer (the "Offer") sent by the Issuer by first-class mail, postage prepaid, to each Holder of Securities at its address appearing in the Security
Register on the date of the Offer offering to purchase up to the principal amount of Securities specified in such Offer at the purchase price specified in such Offer (as determined pursuant to this
Indenture). Unless otherwise required by applicable law, the Offer shall specify an expiration date (the "Expiration Date") of the Offer to Purchase which shall be, subject to any contrary
requirements of applicable law, not less than 30 days or more than 60 days after the date of such Offer and a settlement date (the "Purchase Date") for purchase of Securities within five
Business Days after the Expiration Date. The Issuer shall notify the Trustee at least 15 Business Days (or such shorter period as is acceptable to the Trustee) prior to the mailing of the Offer of the
obligation to make an Offer to Purchase, and the Offer shall be mailed by the Issuer or, at the Issuer's request, by the Trustee in the name and at the expense of the 


12





 



Issuer.
The Offer shall contain information concerning the business of Parent and its Subsidiaries which the Issuer in good faith believes will enable such Holders to make an informed decision with
respect to the Offer to Purchase (which at a minimum will include (i) the most recent annual and quarterly financial statements and "Management's Discussion and Analysis of Financial Condition
and Results of Operations" contained in the documents required to be filed with the Trustee pursuant to this Indenture (which requirements may be satisfied by delivery of such documents together with
the Offer), (ii) a description of material developments in Parent's business subsequent to the date of the latest of such financial statements referred to in clause (i) (including
a description of the events requiring the Issuer to make the Offer to Purchase), (iii) if applicable, appropriate pro forma financial information concerning the Offer to Purchase and the events
requiring the Issuer to make the Offer to Purchase and (iv) any other information required by applicable law to be included therein). The Offer shall contain all instructions and materials
necessary to enable such Holders to tender Securities pursuant to the Offer to Purchase. The Offer shall also state: 


        a.     the
Section of this Indenture pursuant to which the Offer to Purchase is being made; 


        b.     the
Expiration Date and the Purchase Date; 


        c.     the
aggregate principal amount of the Outstanding Securities offered to be purchased by the Issuer pursuant to the Offer to Purchase (including, if less than 100%, the
manner by which such amount has been determined pursuant to the Section hereof requiring the Offer to Purchase) (the "Purchase Amount"); 


        d.     the
purchase price to be paid by the Issuer for $1,000 aggregate principal amount of Securities accepted for payment (as specified pursuant to this Indenture) (the
"Purchase Price"); 


        e.     that
the Holder may tender all or any portion of the Securities registered in the name of such Holder and that any portion of a Security tendered must be tendered in an
integral multiple of $1,000 principal amount; 


        f.      the
place or places where Securities are to be surrendered for tender pursuant to the Offer to Purchase; 


        g.     that
any Securities not tendered or tendered but not purchased by the Issuer will continue to accrue interest; 



        h.     that
on the Purchase Date the Purchase Price will become due and payable upon each Security being accepted for payment pursuant to the Offer to Purchase and that interest
thereon, if any, shall cease to accrue on and after the Purchase Date; 


        i.      that
each Holder electing to tender a Security pursuant to the Offer to Purchase will be required to surrender such Security at the place or places specified in the Offer
prior to the close of business on the Expiration Date (such Security being, if the Issuer or the Trustee so requires, duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing); 



        j.      that
Holders will be entitled to withdraw all or any portion of Securities tendered if the Issuer (or the Paying Agent) receives, not later than the close of business on
the Expiration Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security the Holder tendered, the certificate number of the Security the
Holder tendered and a statement that such Holder is withdrawing all or a portion of his tender; 


        k.     that
(i) if Securities in an aggregate principal amount less than or equal to the Purchase Amount are duly tendered and not withdrawn pursuant to the Offer to
Purchase, the Issuer shall purchase all such Securities and (ii) if Securities in an aggregate principal amount in excess of the Purchase Amount are tendered and not withdrawn pursuant to the
Offer to Purchase, the Issuer shall 


13





 



purchase
Securities having an aggregate principal amount equal to the Purchase Amount on a pro rata basis (with such adjustments as may be deemed
appropriate so that only Securities in denominations of $1,000 or integral multiples thereof shall be purchased); and 



        l.      that
in the case of any Holder whose Security is purchased only in part, the Issuer shall execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder, in an aggregate principal amount equal to and in exchange for the unpurchased
portion of the Security so tendered. 


        Any
Offer to Purchase shall be governed by and effected in accordance with the Offer for such Offer to Purchase. 



        "Offering
Proceeds Note" means the intercompany demand note dated the Issue Date, in an initial principal amount equal to $500,000,000, issued by Level 3 LLC to the Issuer as it may be
amended from time to time pursuant to Sections 301 and 1020. 


        "Offering
Proceeds Note Guarantee" means an unconditional Guarantee of the due and punctual payment of the principal of and premium, if any, and interest on the Offering Proceeds
Note, when and as due, whether on demand, at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and all other monetary obligations of Level 3 LLC under the Offering
Proceeds Note, in substantially the form set forth in Exhibit E hereto. 



        "Offering
Proceeds Note Guarantor" means any Restricted Subsidiary that provides an Offering Proceeds Note Guarantee pursuant to Section 1010, Section 1011 or
any other provision of the Indenture. 


        "Officers'
Certificate" of any Person means a certificate signed by the Chairman of the Board of Directors of such Person, a Vice Chairman of the Board of Directors of such Person, the
President or a Vice President, and by the Chief Financial Officer, the Chief Accounting Officer, the Treasurer, an Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of such
Person and delivered to the Trustee, which shall comply with this Indenture. 


        "Opinion
of Counsel" means an opinion of counsel acceptable to the Trustee (who may be counsel to Parent or the Issuer, including an employee of Parent or the Issuer). 


        "OECD"
shall mean the Organization for Economic Cooperation and Development. 


        "Original
Securities" has the meaning set forth in Section 301. 


        "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)   on
and after any maturity or redemption date, Securities, or portions thereof, for whose payment or redemption money in the necessary amount has been theretofore
deposited with the Trustee or any Paying Agent (other than Parent or the Issuer) in trust or set aside and segregated in trust by Parent, the Issuer (if Parent or the Issuer shall act as its own
Paying Agent) for the Holders of such Securities; provided that (a) the Trustee or the Paying Agent, as applicable, is not prohibited from paying
such money to the Holders and (b) if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture; 


        (iii)  Securities,
except to the extent provided in Sections 1202 and 1203, with respect to which the Issuer has effected defeasance or covenant defeasance as provided
in Article Twelve; and 



14





 




        (iv)  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 the Securities are valid obligations of the Issuer; 




provided, however, that in determining whether the Holders of the requisite principal amount of
Outstanding Securities have given any request, demand, authorization, direction, consent, notice or waiver hereunder, and for the purpose of making the calculations required by TIA Section 313,
Securities owned by the Issuer or any other obligor upon the Securities or any Affiliate of the Issuer or
such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in making such calculation or in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only Securities which any Responsible Officer of the Trustee actually knows to be so owned or as to which the Trustee has received
written notice 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 Issuer or any other obligor upon the Securities or any Affiliate of the Issuer or such other obligor. 



        "Parent"
means the Person named as "Parent" 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 "Parent" shall mean such successor Person. 


        "Parent
Guarantee" means the Note Guarantee of Parent. 


        "Parent
Intercompany Note" means the intercompany demand note dated December 8, 1999, as amended and restated on the Issue Date, in the principal amount of $11,547,230,519.00,
issued by Level 3 LLC to Parent. 


        "Paying
Agent" means any Person (including Parent or the Issuer acting as Paying Agent) authorized by Parent or the Issuer to pay the principal of (and premium, if any) or interest on
any Securities on behalf of the Issuer. 


        "Permitted
Holders" means the members of Parent's Board of Directors on the Measurement Date and their respective estates, spouses, ancestors, and lineal descendants, the legal
representatives of any of the foregoing and the trustees of any bona fide trusts of which the foregoing are the sole beneficiaries or the grantors, or any Person of which the foregoing "beneficially
owns" (as defined in Rule 13d-3 under the Exchange Act) at least 662/3% of the total voting power of the Voting Stock of such Person. 



        "Permitted
Interest Rate or Currency Protection Agreement" of any Person means any Interest Rate or Currency Protection Agreement entered into with one or more financial institutions in
the ordinary course of business that is designed to protect such Person against fluctuations in interest rates or currency exchange rates with respect to Debt Incurred and not for purposes of
speculation and which, in the case of an interest rate agreement, shall have a notional amount no greater than the principal amount at maturity due with respect to the Debt being hedged thereby. 


        "Permitted
Investments" means (a) Cash Equivalents; (b) investments in prepaid expenses; (c) negotiable instruments held for collection and lease, utility and
workers' compensation, performance and other similar deposits; (d) loans, advances or extensions of credit to employees and directors made in the ordinary course of business and consistent with
past practice; (e) obligations under Permitted Interest Rate or Currency Protection Agreements; (f) bonds, notes, debentures and other securities received as a result of Asset
Dispositions pursuant to and in compliance with Section 1016; (g) Investments in any Person as a result of which such Person becomes a Restricted Subsidiary; (h) Investments made
prior to the Measurement Date; (i) Investments made after the Measurement 


15





 



Date
in Persons engaged in the Telecommunications/IS Business in an aggregate amount not to exceed Invested Capital; and (j) additional Investments in an aggregate amount not to exceed
$200,000,000. 


        "Permitted
Liens" means (a) Liens for taxes, assessments, governmental charges, levies or claims which are not yet delinquent or which are being contested in good faith by
appropriate proceedings, if a reserve or other appropriate provision, if any, as shall be required in conformity with generally accepted accounting principles shall have been made therefor;
(b) other Liens incidental to the conduct of Parent's and its Restricted Subsidiaries' businesses or the ownership of its Property not securing any Debt, and which do not in the aggregate
materially detract from the value of Parent's and its Restricted Subsidiaries' Property when taken as a whole, or materially impair the use thereof in the operation of its business; (c) Liens,
pledges and deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of statutory obligations; (d) Liens, pledges or
deposits made to secure the performance of tenders, bids, leases, public or statutory obligations, sureties, stays, appeals, indemnities, performance or other similar bonds and other obligations of
like nature incurred in the ordinary course of business (exclusive of obligations for the payment of borrowed money, the obtaining of advances or credit or the payment of the deferred purchase price
of Property and which do not in the aggregate materially impair the use of Property in the operation of the business of Parent and the Restricted Subsidiaries taken as a whole); (e) zoning
restrictions, servitudes, easements, rights-of-way, restrictions and other similar charges or encumbrances incurred in the ordinary course of business which, in the aggregate,
do not materially detract from the value of the Property subject thereto or materially interfere with the ordinary conduct of the business of Parent or its Restricted Subsidiaries; and (f) any
interest or title of a lessor in the Property subject to any lease other than a Capital Lease. 


        "Permitted
Telecommunications Capital Asset Disposition" means the transfer, conveyance, sale, lease or other disposition of optical fiber and/or conduit and any related equipment used
in a Segment (as defined) of Parent's communications network that (i) constitute capital assets in accordance with generally accepted accounting principles and (ii) after giving effect
to such disposition, would result in Parent retaining at least either (A) 24 optical fibers per route mile on such Segment as deployed at the time of such disposition or (B) 12 optical
fibers and one empty conduit per route mile on such Segment as deployed at such time. "Segment" means (x) with respect to Parent's intercity network, the through-portion of such network between
two local networks (i.e., Omaha to Denver) and (y) with respect to a local network of Parent (i.e., Dallas), the entire through-portion of such network, excluding the spurs which branch off the
through-portion. 


        "Person"
means any individual, corporation, company, partnership, joint venture, limited liability company, association, joint stock company, trust, unincorporated organization,
government or agency or political subdivision thereof or any other entity. 



        "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 a mutilated security or in lieu of a lost, destroyed or stolen Security shall be deemed
to evidence the same debt as the mutilated, lost, destroyed or stolen Security. 


        "Preferred
Stock" of any Person means Capital Stock of such Person of any class or classes (however designated) that ranks prior, as to the payment of dividends or as to the distribution
of assets upon any voluntary or involuntary liquidation, dissolution or winding-up of such Person, to shares of Capital Stock of any other class of such Person. 



        "Preferred
Stock Dividends" means all dividends with respect to Preferred Stock of Restricted Subsidiaries held by Persons other than Parent or the Issuer or a Wholly Owned Restricted
Subsidiary of Parent or the Issuer, respectively. The amount of any such dividend shall be equal to the quotient of such dividend divided by the difference between one and the maximum statutory
federal income rate 


16





 



(expressed
as a decimal number between 1 and 0) applicable to the issuer of such Preferred Stock for the period during which such dividends were paid. 



        "Private
Exchange Offer" means the offer by the Issuer, pursuant to Section 2(f) of the Registration Agreement dated October 1, 2003, or pursuant to any similar
Registration Agreement entered into in connection with the registration of Additional Securities, to issue and deliver to certain purchasers, in exchange for the Initial Securities held by such
purchasers as part of their initial distribution, a like aggregate principal amount of Private Exchange Securities. 


        "Private
Exchange Securities" means the Exchange Securities to be issued pursuant to this Indenture in connection with a Private Exchange Offer pursuant to the relevant Registration
Agreement. 


        "Private
Placement Legend" means the third paragraph of the legend set forth in the Securities in the form set forth in Exhibit 1 to Appendix A. 


        "Property"
means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital
Stock in, and other securities of, any other Person. For purposes of any calculation required pursuant to this Indenture, the value of any Property shall be its Fair Market Value. 


        "Proportionate
Interest" in any issuance of Capital Stock of a Restricted Subsidiary means a ratio (i) the numerator of which is the aggregate amount of all Capital Stock of such
Restricted Subsidiary beneficially owned by Parent and the Restricted Subsidiaries and (ii) the denominator of which is the aggregate amount of Capital Stock of such Restricted Subsidiary
beneficially owned by all Persons (excluding, in the case of this clause (ii), any Investment made in connection with such issuance). 


        "Purchase
Amount" has the meaning specified in "Offer to Purchase" above. 


        "Purchase
Date" has the meaning specified in "Offer to Purchase" above. 


        "Purchase
Money Debt" means Debt (including Acquired Debt and Capital Lease Obligations, mortgage financings and purchase money obligations) incurred for the purpose of financing all or
any part of the cost of construction, installation, acquisition, lease, development or improvement by Parent or any Restricted Subsidiary of any Telecommunications/IS Assets of Parent or any
Restricted Subsidiary and including any related notes, Guarantees, collateral documents, instruments and agreements executed in connection therewith, as the same may be amended, supplemented, modified
or restated from time to time. 


        "Purchase
Price" has the meaning specified in "Offer to Purchase" above. 


        "Qualified
Credit Facility" means one or more credit agreements, loan agreements, or similar facilities, secured or unsecured, providing for revolving credit loans, term loans and/or
letters of credit, including any Qualified Receivable Facility, entered into from time to time by Parent and its Restricted Subsidiaries, and including any related notes, Guarantees, collateral
documents, instruments and agreements executed in connection therewith, as the same may be amended, supplemented, modified, restated or replaced from time to time. 


        "Qualified
Institutional Buyer" or "QIB" has the meaning specified in Rule 144A. 


        "Qualified
Receivable Facility" means Debt of Parent or any Subsidiary Incurred from time to time pursuant to either (x) credit facilities secured by Receivables or
(y) Receivables purchase facilities, and including any related notes, Guarantees, collateral documents, instruments and agreements executed in
connection therewith, as the same may be amended, supplemented, modified or restated from time to time. 


        "Rating
Agencies" mean Moody's and S&P. 


17





 



        "Rating
Date" means the earlier of the date of public notice of the occurrence of a Change of Control or of the intention of Parent to effect a Change of Control. 



        "Rating
Decline" shall be deemed to have occurred if, no later than 90 days after the Rating Date (which period shall be extended so long as the rating of the Securities is under
publicly announced consideration for possible downgrade by any of the Rating Agencies), either of the Rating Agencies assigns or reaffirms a rating to the Securities that is lower than the applicable
Issue Date Rating (or the equivalent thereof). If, prior to the Rating Date, either of the ratings assigned to the Securities by the Rating Agencies is lower than the applicable Issue Date Rating,
then a Rating Decline will be deemed to have occurred if such rating is not changed by the 90th day following the Rating Date. A downgrade within rating categories, as well as between rating
categories, will be considered a Rating Decline. A "Rating Decline" also shall be deemed to have occurred if a Rating Decline (as defined in any indenture governing any of the Existing Notes) shall
have occurred in respect of any of the Existing Notes. 


        "Receivables"
means receivables, chattel paper, instruments, documents or intangibles evidencing or relating to the right to payment of money and proceeds and products thereof in each
case generated in the ordinary course of business. 


        "Redemption
Date", when used with respect to any Security to be redeemed, in whole or in part, 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. 


        "refinancing"
has the meaning specified in Section 1010(b)(viii) and 1011(b)(iv). 


        "Registered
Exchange Offer" means the offer by the Issuer, pursuant to the relevant Registration Agreement, to certain Holders of Initial Securities, to issue and deliver to such
Holders, in exchange for the Initial Securities, a like aggregate principal amount of Exchange Securities registered under the Securities Act. 



        "Registration
Agreement" means the Registration Agreement dated October 1, 2003, among the Issuer, Parent and the Initial Purchasers relating to the Original Securities or any
similar agreement relating to any registration of Additional Securities. 


        "Regular
Record Date" for the interest payable on any Interest Payment Date means the April 1 or October 1 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. 


        "Regulation
S" means Regulation S under the Securities Act. 



        "Regulation S
Global Security" has the meaning specified in Section 2.1(a) of Appendix A. 


        "Required
Filing Dates" has the meaning specified in Section 1007. 


        "Responsible
Officer", when used with respect to the Trustee, means any officer within the Trustee's Corporate Trust Office, including any vice president, any assistant secretary, any
assistant treasurer, or any other officer of the Trustee customarily performing functions similar to those performed by any of the above-designated officers, and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. 


        "Restricted
Payment" has the meaning specified in Section 1012. 


18







   
        "Restricted Subsidiary" means (a) a Subsidiary of Parent or of a Restricted Subsidiary, including the Issuer, that has not been designated or classified as an Unrestricted
Subsidiary pursuant to and in compliance with Section 1019 and (b) an Unrestricted Subsidiary that is redesignated as a Restricted Subsidiary pursuant to such Section. 



        "Revocation"
has the meaning specified in Section 1019. 


        "Rule 144A"
means Rule 144A under the Securities Act. 


        "Rule 144A
Global Security" has the meaning specified in Section 2.1(a) of Appendix A. 


        "S&P"
means Standard & Poor's Ratings Service or, if Standard & Poor's Ratings Service shall cease rating debt securities having a maturity at original issuance of at least
one year and such ratings business shall have been transferred to a successor Person, such successor Person; provided,  however, that if Standard &
Poor's Ratings Service ceases rating debt securities having a maturity at original issuance of at least one year and
its ratings business with respect thereto shall not have been transferred to any successor Person, then "S&P" shall mean any other nationally recognized rating agency (other than Moody's) that rates
debt securities having a maturity at original issuance of at least one year and that shall have been designated by the Trustee by a written notice given to the Issuer. 


        "Sale
and Leaseback Transaction" of any Person means any direct or indirect arrangement pursuant to which any Property is sold or transferred by such Person or a Restricted Subsidiary of
such person and is thereafter leased back from the purchaser or transferee thereof by such Person or one of its Restricted Subsidiaries. The stated maturity of such arrangement shall be the date of
the last payment of rent or any other amount due under such arrangement prior to the first date on which such arrangement may be terminated by the lessee without payment of a penalty. 


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


        "Securities
Act" means the Securities Act of 1933, as amended (or any successor act), and the rules and regulations thereunder (or respective successors thereto). 


        "Security
Register" and "Security Registrar" have the respective meanings specified in Section 303. 



        "Shelf
Registration Statement" means a registration statement issued by Parent and the Issuer in connection with the offer and sale of Initial Securities pursuant to the relevant
Registration Agreement. 


        "Significant
Subsidiary" means any Subsidiary that would be a "Significant Subsidiary" of Parent within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Commission. 


        "Sister
Restricted Subsidiary" means a Restricted Subsidiary that is not the Issuer or an Issuer Restricted Subsidiary. 



        "Special
Assets" means (a) the Capital Stock or assets of RCN Corporation and Commonwealth Telephone Enterprises, Inc. (and any intermediate holding companies or other
entities formed solely for the purpose of owning such Capital Stock or assets) owned, directly or indirectly, by Parent or any Restricted Subsidiary on the Measurement Date, and (b) any
Property, other than cash, Cash Equivalents and Telecommunications/IS Assets, received as consideration for the disposition after the Measurement Date of Special Assets (as contemplated by the first
proviso in Section 1016). 


        "Special
Interest" has the meaning specified in Exhibit A. 


        "Stated
Maturity" when used with respect to a Security or any installment of interest thereon, means the date specified in such Security as the fixed date on which the principal of such
Security or such installment of interest is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such Security at the
option of 


19





 



the
Holder thereof upon the happening of any contingency beyond the control of the Issuer unless such contingency has occurred). 



        "Subordinated
Debt" means Debt of Parent (a) that is not secured by any Lien on or with respect to any Property now owned or acquired after the Measurement Date and (b) as
to which the payment of principal of (and premium, if any) and interest and other payment obligations in respect of such Debt shall be subordinate to the prior payment in full in cash of the Parent
Guarantee to at least the following extent: (i) no payments of principal of (or premium, if any) or interest on or otherwise due
(including by acceleration or for additional amounts) in respect of, or repurchases, redemptions or other retirements of, such Debt (collectively, "payments of such Debt") may be permitted for so long
as any default (after giving effect to any applicable grace periods) in the payment of principal (or premium, if any) or interest on the Securities exists, including as a result of acceleration;
(ii) in the event that any other Default exists with respect to the Securities, upon notice by Holders of 25% or more in aggregate principal amount of the Securities to the Trustee, the Trustee
shall have the right to give notice to Parent and the holders of such Debt (or trustees or agents therefor) of a payment blockage, and thereafter no payments of such Debt may be made for a period of
179 days from the date of such notice; provided, however, that not more than one such payment
blockage notice may be given in any consecutive 360-day period, irrespective of the number of defaults with respect to the Securities during such period; (iii) if payment of such
Debt is accelerated when any Securities are Outstanding, no payments of such Debt may be made until three Business Days after the Trustee receives notice of such acceleration and, thereafter, such
payments may only be made to the extent the terms of such Debt permit payment at that time; and (iv) such Debt may not (x) provide for payments of principal of such Debt at the stated
maturity thereof or by way of a sinking fund applicable thereto or by way of any mandatory redemption, defeasance, retirement or repurchase thereof by Parent (including any redemption, retirement or
repurchase which is contingent upon events or circumstances but excluding any retirement required by virtue of acceleration of such Debt upon an event of default thereunder), in each case prior to the
final Stated Maturity of the Securities or (y) permit redemption or other retirement (including pursuant to an offer to purchase made by Parent) of such other Debt at the option of the holder
thereof prior to the final Stated Maturity of the Securities, other than, in the case of clause (x) or (y), any such payment, redemption or other retirement (including pursuant to an
offer to purchase made by Parent) which is conditioned upon (A) a change of control of Parent pursuant to provisions substantially similar to those described in Section 1009 (and which
shall provide that such Debt will not be repurchased pursuant to such provisions prior to the Issuer's repurchase of the Securities required to be repurchased by the Issuer pursuant to the provisions
described in Section 1009) or (B) a sale or other disposition of assets pursuant to provisions substantially similar to those described in Section 1016 (and which shall provide
that such Debt will not be repurchased pursuant to such provisions prior to the Issuer's repurchase of the Securities required to be repurchased by the Issuer pursuant to the provision described in
Section 1016). 


        "Subordination
Agreement" means the Subordination Agreement dated the Issue Date, among the Issuer, Parent and Level 3 LLC, and the other Restricted Subsidiaries and Sister Restricted
Subsidiaries becoming party thereto as contemplated therein, pursuant to which such Restricted Subsidiaries shall subordinate obligations owed to Parent or any Sister Restricted to any obligations
owed in respect of the Offering Proceeds Note, in substantially in the form set forth in Exhibit D hereto. 


        "Subsidiary"
of any Person means (i) a corporation more than 50% of the combined voting power of the outstanding Voting Stock of which is owned, directly or indirectly, by such
Person or by one or more other Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof or (ii) any other Person (other than a corporation) in which such Person, or
one or more other Subsidiaries of such Person or such Person and one or more other Subsidiaries thereof, directly or indirectly, has at least a majority ownership and power to direct the policies,
management and affairs thereof. 


20





 



        "Telecommunications/IS
Assets" means (a) any Property (other than cash, cash equivalents and securities) to be owned by Parent or any Restricted Subsidiary and used in the
Telecommunications/IS Business; (b) for purposes of Sections 1010, 1011 and 1014 only, Capital Stock of any Person; or (c) for all other purposes of this Indenture, Capital Stock
of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by Parent or another Restricted Subsidiary from any Person other than an Affiliate of Parent;  provided, however, that, in the case of clause (b) or (c), such Person is primarily
engaged in the Telecommunications/IS Business. 


        "Telecommunications/IS
Business" means the business of (i) transmitting, or providing services relating to the transmission of, voice, video or data through owned or leased
transmission facilities, (ii) constructing, creating, developing or marketing communications networks, related network transmission equipment, software and other devices for use in a
communications business, (iii) computer outsourcing, data center management, computer systems integration, reengineering of computer software for any purpose (including, without limitation, for
the purposes of porting computer software from one operating environment or computer platform to another or to address issues commonly referred to as "Year 2000 issues") or (iv) evaluating,
participating or pursuing any other activity or opportunity that is primarily related to those identified in (i), (ii) or (iii) above;  provided, however, that the determination of what constitutes a Telecommunications/IS Business shall be
made in good faith by the Board of Directors of Parent. 


        "Trust
Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as in force at the date as of which this Indenture was executed, except as provided in Section 9.05. 


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


        "Unrestricted
Subsidiary" means (a) 91 Holding Corp. (the subsidiary that holds indirectly Parent's interests in the SR91 tollroad), Level 3 Finance LLC, Level 3 Finance II LLC,
Eldorado Funding LLC, SR 91 Holding LLC, SR91 Corp, SR LP, Express Lanes, Inc., California Private Transportation Company LP, CPTC LLC and 85 Tenth Avenue LLC; (b) any Subsidiary of an
Unrestricted Subsidiary; and (c) any Subsidiary of Parent designated as such pursuant to and in compliance with Section 1019 and not thereafter redesignated as a Restricted Subsidiary as
permitted pursuant thereto. For the sake of clarity, actions taken by an Unrestricted Subsidiary will not be deemed to have been taken, directly or indirectly, by Parent or any Restricted Subsidiary. 


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


        "Voting
Stock" of any Person means Capital Stock of such Person which ordinarily has voting power for the election of directors (or persons performing similar functions) of such Person,
whether at all
times or only for so long as no senior class of securities has such voting power by reason of any contingency. 


        "Wholly
Owned Subsidiary" of any Person means a Subsidiary of such Person all of the outstanding Voting Stock or other ownership interests (other than directors' qualifying shares) of
which shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person or by such Person and one or more Wholly Owned Subsidiaries of such Person. 



        The
following terms, unless otherwise defined pursuant to this Section 101, have the meanings given to them in Appendix A: 



"Additional
Securities"

"Agent Members"

"Definitive Security"




21





 

"Depository"

"Distribution Compliance Period"

"Exchange Securities"

"Euroclear"

"Global Security"

"Initial Purchasers"

"Initial Securities"

"Original Securities"

"Private Exchange"

"Private Exchange Securities"

"Purchase Agreement"

"QIB"

"Registered Exchange Offer"

"Registration Agreement"

"Regulation S"

"Rule 144A"

"Rule 144A Global Security"

"Rule 144A Securities"

"Securities"

"Securities Act"

"Securities Custodian"

"Shelf Registration Statement"

"Transfer Restricted Securities" 




        SECTION
102. Compliance Certificates and Opinions.


        Upon
any application or request by the Issuer to the Trustee to take any action under any provision of this Indenture, the Issuer shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent, if any, provided for in this Indenture (including any covenant compliance with which constitutes a condition precedent) relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, 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 each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; 


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


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


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




        SECTION
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, 


22





 



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 Issuer or any 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 the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer
or officers of the Issuer or any Guarantor, respectively, stating that the information with respect to such factual matters is in the possession of the Issuer or any Guarantor, respectively, 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 (with proper identification of each matter covered therein) 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 agents 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 Issuer. 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 Issuer, if made in the manner provided in
this Section. 


        (b)   The
fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a
notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner that the Trustee deems sufficient. 


        (c)   The
principal amount and serial numbers of Securities held by any Person, and the date of holding the same, shall be proved by the Security Register. 



        (d)   If
the Issuer shall solicit from the Holders of Securities any request, demand, authorization, direction, notice, consent, waiver or other Act, the Issuer 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 Issuer shall have no obligation to do so. Notwithstanding TIA Section 316(c), such record date shall be the record date specified in or pursuant to such Board 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, 


23





 



authorization,
direction, notice, consent, waiver or other Act may be 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 have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for that purpose the Outstanding Securities shall be computed as of such record date;  provided that no such authorization, agreement
or consent by the Holders on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six 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 Issuer in reliance thereon, whether or not notation of such action is made upon such Security. However, any such Holder or future Holder may revoke the request, demand, authorization, direction,
notice, consent, waiver or other Act of the Holder as to such Holder's Security or portion of the Security if the Trustee receives the notice of revocation before the date such Act becomes effective. 



        SECTION
105. Notices, etc., to Trustee and the Issuer.


        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 Issuer 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: Corporate Trust Administration, or 



        (2)   the
Issuer or any 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 Issuer or such Guarantor addressed to it (in the case of a Guarantor, in care of the Issuer) at the address of the Issuer's principal office specified
in the first paragraph of this Indenture, or at any other address previously furnished in writing to the Trustee by the Issuer. 




        SECTION
106. Notice to Holders; Waiver.


        Where
this Indenture provides for notice of any event to Holders by the Issuer or the Trustee, such notice shall be given (unless otherwise herein expressly provided) if in writing and
mailed, first-class postage prepaid, to each Holder affected by such event, at the address of such Holder 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. Notices shall be effective only upon receipt. 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 or irregularities in regular mail service or by reason of any other cause, it shall be impracticable to mail notice of any event to Holders when
such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Trustee shall be deemed to be a sufficient giving
of such notice for every purpose hereunder. 


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        SECTION
107. 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
108. Successors and Assigns.


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


        SECTION
109. Separability Clause.


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


        SECTION
110. Benefits of Indenture.


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


        SECTION
111. Governing Law.


        THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.


        SECTION
112. Conflict with Trust Indenture Act.


        The
Trust Indenture Act shall apply as a matter of contract to this Indenture for purposes of interpretation, construction and defining the rights and obligations hereunder. If any
provision hereof limits, qualifies or conflicts with any provision of the Trust Indenture Act or another provision which is
required or deemed to be included in this Indenture by any of the provisions of the Trust Indenture Act, such provision or requirement of the Trust Indenture Act shall control. 


        If
any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to
this Indenture as so modified or excluded, as the case may be. 


        SECTION
113. Legal Holidays.


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


        SECTION
114. No Personal Liability of Directors, Officers, Employees and Stockholders.


        No
director, officer, employee, incorporator or stockholder of the Issuer or any Guarantor, as such, shall have any liability for any obligations of the Issuer or any Guarantor under the
Securities or this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of the Issuer or a Guarantor. By accepting a Security, each Holder waives and releases all such liability 


25





 



(but
only such liability). The waiver and release are part of the consideration for issuance of the Securities. 


        SECTION
115. Independence of Covenants.


        All
covenants and agreements in this Indenture shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it
would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not avoid the occurrence of a Default if such action is taken or condition exists. 


        SECTION
116. Exhibits.


        All
exhibits attached hereto are by this reference made a part hereof with the same effect as if herein set forth in full. 


        SECTION
117. Counterparts.


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


        SECTION
118. Duplicate Originals.


        The
parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 


ARTICLE TWO  


 SECURITY FORMS  


        SECTION 201. Form and Dating.


        Provisions
relating to the Initial Securities and the Exchange Securities are set forth in Appendix A, which is hereby incorporated in and expressly made part of this Indenture.
The Initial Securities and the Trustee's certificate of authentication shall be substantially in the form of Exhibit 1 to Appendix A which is hereby incorporated in and expressly made a
part of this Indenture. The Exchange Securities and the Trustee's certificate of authentication shall be substantially in the form of Exhibit A, which is hereby incorporated in and expressly
made a part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements to which the Issuer is subject, if any, or usage, provided
that any such notation, legend or endorsement is in a form reasonably acceptable to the Issuer. Each Security shall be dated the date of its authentication. The terms of the Securities set forth in
Exhibit 1 to Appendix A and Exhibit A are part of the terms of this Indenture. 


        The
definitive Securities shall be printed, lithographed or engraved on steel-engraved borders or may be produced in any other manner permitted by the rules of any securities exchange or
system on which the Securities may be listed or eligible for trading, all as determined by the officers of the Issuer executing such Securities, as evidenced by their execution of such Securities. 


ARTICLE THREE  


 THE SECURITIES  


        SECTION 301. Amount of Securities. Subject to Section 302, the Trustee shall authenticate Initial
Securities for original issue on the Issue Date in the aggregate principal amount of $500,000,000 (the "Original Securities"). 



        The
Issuer shall be entitled, subject to its compliance with the covenants set forth in this Indenture, including Section 1010 and Section 1011, to issue Additional
Securities under this Indenture 


26





 



which
shall have identical terms as the Original Securities, other than with respect to the date of issuance and issue price. The Original Securities, any Additional Securities and all Exchange
Securities or Private Exchange Securities issued in exchange therefor shall be treated as a single class for all purposes under this Indenture. 



        With
respect to the Additional Securities, the Issuer shall set forth in a Board Resolution and an Officers' Certificate, a copy of each which shall be delivered to the Trustee, the
following information: 



        (1)   the
aggregate principal amount of such Additional Securities to be authenticated and delivered pursuant to this Indenture; 


        (2)   the
issue price, the issue date and the CUSIP number of such Additional Securities; provided,  however, that no Additional Securities may be issued at a price
that would cause such Additional Securities to have "original issue discount" within the
meaning of Section 1273 of the Code; and 


        (3)   whether
such Additional Securities shall be Transfer Restricted Securities and issued in the form of Securities as set forth in the Appendix to this Indenture or shall
be issued in the form of Exchange Securities as set forth in Exhibit A. 




        For
each issuance of Additional Securities, the Issuer shall use the net proceeds of each such issuance and additional funds as necessary to lend to Level 3 LLC an amount equal to the
principal amount of the Additional Securities so issued, and the principal amount of the Offering Proceeds Note shall be increased by such amount. 



        SECTION
302. Execution and Authentication. Two Officers shall sign the Securities for the Issuer by manual or facsimile signature. 


        If
an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless. 


        At
any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Securities executed by the Issuer to the Trustee for authentication, together
with a written order of the Issuer in the form of an Officers' Certificate for the authentication and delivery of such Securities, and the Trustee in accordance with such written order of the Issuer
shall authenticate and deliver such Securities. 


        A
Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence
that the Security has been authenticated under this Indenture. 


        The
Trustee may appoint an authenticating agent reasonably acceptable to the Issuer to authenticate the Securities. Unless limited by the terms of such appointment, an authenticating
agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has
the same rights as any Security Registrar, Paying Agent or agent for service of notices and demands. 


        SECTION
303. Security Registrar and Paying Agent. The Issuer shall maintain an office or agency in The City of New York where Securities
may be presented for registration of transfer or for exchange (the "Security Registrar") and an office or agency in The City of New York where Securities may be presented for payment to the Paying
Agent. The Security Registrar shall keep a register of the Securities and of their transfer and exchange (the register maintained in the office of the Security Registrar and in any other office or
agency designated pursuant to Section 1002 being herein sometimes referred to as the "Security Register"). The Issuer may have one or more co-registrars and one or more additional
paying agents. The term "Paying Agent" includes any additional paying agent. 


27







   
        The Issuer shall enter into an appropriate agency agreement with any Security Registrar, Paying Agent or co-registrar not a party to this Indenture, which shall incorporate
the terms of the TIA. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuer shall notify the Trustee of the name and address of any such agent. If the
Issuer fails to maintain a Securities Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 607. 



        The
Issuer initially appoints the Trustee as Security Registrar and Paying Agent in connection with the Securities. 


        SECTION
304. Paying Agent To Hold Money in Trust. Prior to each due date of the principal and interest on any Security, the Issuer shall
deposit with the Paying Agent a sum sufficient to pay such principal and interest when so becoming due. The Issuer shall require each Paying Agent (other than the Trustee) to agree in writing that the
Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal of or interest on the Securities and shall notify the Trustee
of any default by the Issuer in making any such payment. If the Issuer or a Wholly Owned Subsidiary acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Issuer at any time may require a Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed by the Paying Agent. Upon complying with this
Section, the Paying Agent shall have no further liability for the money delivered to the Trustee. 


        SECTION
305. Holders Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to
it of the names and addresses of Holders. If the Trustee is not the Security Registrar, the Issuer shall furnish to the Trustee, in writing at least five Business Days before each Interest Payment
Date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders. 


        SECTION
306. Replacement Securities. If a mutilated Security is surrendered to the Security Registrar or if the Holder of a Security
claims that such Security has been lost, destroyed or wrongfully taken, the Issuer shall issue and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies any other reasonable requirements of the Trustee. Such Holder shall furnish an indemnity bond
sufficient in the judgment of the Issuer and the Trustee to protect the Issuer, the Trustee, the Paying Agent, the Security Registrar and any co-registrar from any loss which any of them
may suffer if a Security is replaced. The Issuer and the Trustee may charge the Holder for their expenses in replacing a Security. 


        Every
replacement Security is an additional obligation of the Issuer. 


        SECTION
307. Temporary Securities. Until definitive Securities are ready for delivery, the Issuer may prepare and the Trustee shall
authenticate temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Issuer considers appropriate for temporary
Securities. Without unreasonable delay, the Issuer shall prepare and the Trustee shall authenticate definitive Securities and deliver them in exchange for temporary Securities. 


        SECTION
308. Cancellation. The Issuer at any time may deliver Securities to the Trustee for cancellation. The Security Registrar and the
Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel and dispose of in accordance
with its customary procedures (subject to the record retention requirements of the Exchange Act) all Securities surrendered for registration of transfer, exchange, payment or cancellation unless the
Issuer directs the Trustee to deliver canceled Securities to the Issuer. The Issuer may not issue new Securities to replace Securities it has redeemed, paid or delivered to the Trustee for
cancellation. 


28





 



        SECTION
309. Defaulted Interest. If the Issuer defaults in a payment of interest on the Securities, the Issuer shall pay the defaulted
interest (plus interest on such defaulted interest to the extent lawful) in any lawful manner. The Issuer may pay the defaulted interest to the persons who are Holders on a subsequent special record
date. The Issuer shall fix or cause to be fixed any such special record date and payment date to the reasonable satisfaction of the Trustee and shall promptly mail to each Holder a notice that states
the special record date, the payment date and the amount of defaulted interest to be paid. 


        SECTION
310. CUSIP Numbers. The Issuer in issuing the Securities may use "CUSIP" numbers (if then generally in use) and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; provided,  however, that neither the Issuer nor the Trustee shall
have any responsibility for any defect in the "CUSIP" number that appears on any Security, check,
advice of payment or redemption notice, and any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any
notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of
such numbers. The Issuer will promptly notify the Trustee in writing of any change in the "CUSIP" number(s). 


ARTICLE FOUR  


 SATISFACTION AND DISCHARGE  


        SECTION 401. Satisfaction and Discharge of Indenture.



        This
Indenture shall cease to be of further effect (subject to Section 1206 and except as to surviving rights of registration of transfer, transfer, exchange and replacement of
Securities expressly provided for herein or pursuant hereto) and the Trustee, at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture
when 



        (1)   either




        (a)   all
Outstanding Securities 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 within one year, or 


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




and
the Issuer, in the case of (i), (ii) or (iii) above, has irrevocably deposited or caused to be deposited with the Trustee funds in an amount sufficient to pay and discharge the
entire indebtedness on the Securities not theretofore delivered to the Trustee for cancellation, for principal of (and premium, if any, on), and interest on, the Securities to Maturity or the
Redemption Date, as the case may be; 




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



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




        Notwithstanding
the satisfaction and discharge of this Indenture, the obligations under Sections 607 and 609 and, if money shall have been deposited with the Trustee pursuant to 


29






 

clause (1)(b) of
this Section 401, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003 shall survive. 


        SECTION
402. Application of Trust Money.


        Subject
to the provisions of the last paragraph of Section 1003, all money deposited with the Trustee pursuant to Section 401 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 Issuer acting as its own 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 the Trustee; but such money need not be
segregated from other funds except to the extent required by law. 


ARTICLE FIVE  


 REMEDIES  


        SECTION 501. Events of Default.


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



        (1)   failure
to pay principal of (or premium, if any, on) any Security when due; or 


        (2)   failure
to pay any interest on any Security when due, continued for 30 days; or 


        (3)   default
in the payment of principal of (and premium, if any) and interest on Securities required to be purchased pursuant to an Offer to Purchase pursuant to
Section 1009 when due and payable; or 


        (4)   failure
to perform or comply with the provisions of Section 801, 803, 805, 807 or 1016; or 


        (5)   failure
to perform any covenant or agreement of Parent, the Issuer or any Restricted Subsidiary in this Indenture or in any Security (other than a covenant a default in
whose performance is elsewhere in this Section specifically dealt with) continued for 60 days after written notice to the Issuer by the Trustee or Holders of at least 25% in aggregate
principal amount of the Outstanding Securities, which notice shall specify the default and state that such notice is a "Notice of Default" hereunder; or 



        (6)   default
under the terms of any instrument evidencing or securing Debt of Parent or any Restricted Subsidiary having an outstanding principal amount of not less than
$25,000,000 or its foreign currency equivalent at the time individually or in the aggregate which default results in the acceleration of the payment of such indebtedness or constitutes the failure to
pay such indebtedness when due (after expiration of any applicable grace period); or 


        (7)   the
rendering of a judgment or judgments against Parent or any Restricted Subsidiary in an aggregate amount in excess of $25,000,000 or its foreign currency equivalent
at the time and shall not be waived, satisfied or discharged for any period of 45 consecutive days during which a stay of enforcement shall not be in effect; or 


        (8)   any
Note Guarantee ceases to be in full force and effect (other than in accordance with the terms of such Note Guarantee) or any Guarantor denies or
disaffirms its obligations under its Note Guarantee; or 


        (9)   the
entry of a decree or order by a court having jurisdiction in the premises adjudging Parent, the Issuer or any Significant Subsidiary a bankrupt or insolvent, or
approving as properly 



30





 




filed
a petition seeking reorganization, arrangement, adjustment or composition of or in respect of Parent, the Issuer or any Significant Subsidiary under the Federal Bankruptcy Code or any other
applicable federal, state or foreign law, or appointing a receiver, liquidator, assignee, trustee, custodian or sequestrator (or other similar official) of Parent, the Issuer or any Significant
Subsidiary 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 unstayed and in effect for a period of
30 consecutive days; or 


        (10) the
institution by Parent, the Issuer or any Significant Subsidiary of proceedings to be adjudicated a bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under the Federal Bankruptcy Code or any other applicable
federal, state or foreign law, or the consent by it to the filing of any such petition or to the appointment of a receiver, liquidator, assignee, trustee, custodian or sequestrator (or other similar
official) of Parent, the Issuer or any Significant Subsidiary or of any substantial part of its Property, or the making by it of an assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due. 




        SECTION
502. Acceleration of Maturity; Rescission and Annulment.


        If
an Event of Default (other than an Event of Default specified in Section 501(9) or 501(10) with respect to Parent or the Issuer) shall occur and be continuing, the
Trustee or the Holders of not less than 25% in aggregate principal amount of the Outstanding Securities may declare the principal amount of all the Securities to be due and payable immediately, by a
notice in writing to the Issuer (and to the Trustee if given by Holders), and upon any such declaration such principal amount shall become immediately due and payable. If an Event of Default specified
in Section 501(9) or 501(10) occurs with respect to Parent or the Issuer, the principal amount of all the Securities shall ipso
facto become immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. 


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



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



        (A)  all
overdue interest on all Outstanding Securities, 


        (B)  all
unpaid principal of (and premium, if any, on) any Outstanding Securities which has become due otherwise than by such declaration of acceleration, and interest on
such unpaid principal at the rate borne by the Securities, 


        (C)  to
the extent that payment of such interest is lawful, interest on overdue interest at the rate borne by the Securities, and 


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




        (2)   all
Events of Default, other than the nonpayment of amounts of principal of (or premium, if any, on) Securities 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. 


31





 

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



        The
Issuer covenants that if 



        (a)   Default
is made in the payment of any interest on any Security when due, continued for 30 days, or 


        (b)   default
is made in the payment of the principal of (or premium, if any, on) any Security when due, 




the
Issuer will, upon demand of the Trustee, pay to the Trustee 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, to the extent that payment of such interest shall be legally enforceable, upon any overdue installment of interest,
at the rate borne by the Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel. 


        If
the Issuer fails to pay such amounts forthwith upon such demand, the Trustee, in its own name 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 Issuer or any other obligor upon the Securities and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the property of the Issuer or any other obligor upon the Securities, wherever situated. 



        If
an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders 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 Issuer
or any other obligor upon the Securities (including Parent and any other Guarantor) or the Property of the Issuer 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 herein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Issuer for the
payment of overdue principal, premium, if any, 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 and 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 or 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 the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and 


32





 

advances
of the Trustee and 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 and 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 and its agents and counsel, be for the ratable benefit of the Holders of the
Securities in respect of which such judgment has been recovered. 


        SECTION
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 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:
The balance, if any, to the Person or Persons entitled thereto. 


        SECTION
507. Limitation on Suits.


        No
Holder of any Securities shall have any right to institute any proceeding with respect to this Indenture or for any other remedy hereunder, unless 



        (1)   such
Holder shall have previously given to the Trustee written notice of a continuing Event of Default; 



        (2)   the
Holders of not less than 25% in aggregate principal amount of the Outstanding Securities shall have made written request and offered reasonable indemnity to the
Trustee to institute such proceeding as trustee; and 


        (3)   the
Trustee shall not have received from the Holders of a majority in aggregate principal amount of the Outstanding Securities a direction inconsistent with such request
and shall have failed to institute such proceeding within 60 days; 




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


33





 

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


        Notwithstanding
any other provision in this Indenture, including Section 507, the Holder of any Security shall have the right, which is absolute and unconditional, to receive
payment as provided herein (including, if applicable, Article Twelve) and in such Security of the principal of (and premium, if any) and interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the
case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, 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 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 Issuer, any 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 Section 306, no right or remedy herein conferred upon
or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not
prevent the concurrent assertion or employment of any other appropriate right or remedy. 


        SECTION
511. Delay or Omission Not Waiver.


        No
delay or omission of the Trustee or of any Holder of any Security to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article 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 aggregate principal amount of the Outstanding Securities shall have the right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on the Trustee; provided that 



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


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


        (3)   the
Trustee need not take any action which might involve it in personal liability or be unjustly prejudicial to the Holders not consenting. 




        SECTION
513. Waiver of Past Defaults.


        The
Holders of not less than a majority in principal amount of the Outstanding Securities may, on behalf of the Holders of all the Securities, waive any past Default hereunder and its
consequences, except a Default 



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



34





 

        (2)   in
respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Security
affected, or 


        (3)   in
respect of the covenant contained in Section 1020, which under Article Nine cannot be waived without the consent of the Holders of two-thirds in
principal amount of the Outstanding Securities. 




        The
Issuer and Parent shall deliver to the Trustee an Officers' Certificate stating that the requisite majority have consented to such waiver and attaching such consents upon which,
subject to Section 104, the Trustee may conclusively rely. Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or Event of Default or impair any right consequent thereon. 


        SECTION
514. Waiver of Stay or Extension Laws.


        The
Issuer and each Guarantor covenant (to the extent that they may lawfully do so) that they shall 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 Issuer and each
Guarantor (to the extent that they may lawfully do so) hereby expressly waive all benefit or advantage of any such law and covenant that they shall not hinder, delay or impede the execution of any
power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law had been enacted. 


        SECTION
515. Undertaking for Costs.


        In
any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable
attorney's fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 515 does
not apply to a suit by the Trustee or a suit by Holders of more than 10% in principal amount of the then Outstanding Securities. 


ARTICLE SIX  


 THE TRUSTEE  



        SECTION 601. Certain Duties and Responsibilities.


        (a)   Except
during the continuance of an Event of Default, 



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


        (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 and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their 


35





 

exercise,
as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. 


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



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



        (2)   the
Trustee shall not be liable for any error of 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 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; 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 indemnity reasonably satisfactory to it 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 Default.


        If
a Default occurs and is continuing, the Trustee shall transmit, in the manner and to the extent provided in TIA Section 313(c), notice of such Default within 60 days
after it is known to any Responsible Officer of the Trustee or written notice of it is received by the Trustee; 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, the Trustee shall be
protected in withholding such notice if and so long as the board of directors, the executive committee, 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. 


        The
Trustee is not required to take notice or deemed to have notice of any Event of Default with respect to the Securities, except an Event of Default under Section 5.01(1), (2),
(3) or (4) hereof (provided that in the case of Section 501(4), such Event of Default constitutes a failure to purchase Securities pursuant to an Offer to Purchase pursuant to
Section 10.16), unless the Trustee shall have received written notice at its Corporate Trust Office (which notice shall reference the Securities, the Issuer and the Indenture) of such Event of
Default from the Issuer or any Holder or unless a Responsible Officer of the Trustee shall otherwise have knowledge thereof. 


        SECTION
603. Certain Rights of Trustee.


        Subject
to Section 601 and to the provisions of TIA Sections 315(a) through 315(d): 



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



36







  



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


        (3)   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, receive and rely upon an Officers' Certificate; 


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


        (5)   the
Trustee may act through counsel, agents, custodians and nominees and shall not be responsible for the misconduct or negligence of any such person appointed and
supervised with due care and in good faith; 


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


        (7)   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
Issuer, personally or by agent or attorney; 


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


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


        (10) the
Trustee may request that Parent or the Issuer deliver an Officers' Certificate in substantially the form of Exhibit B hereto setting forth the names of
individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. 




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


        The
recitals contained herein and in the Securities, except for the Trustee's certificates of authentication, shall be taken as the statements of Parent or the Issuer, as applicable, 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, except that the Trustee
represents that it is duly authorized to execute and deliver this Indenture, authenticate the Securities and perform its obligations hereunder. The Trustee shall not be accountable for the use or
application by the Issuer of Securities or the proceeds thereof. 


37





 



        SECTION
605. May Hold Securities.


        The
Trustee, any Paying Agent, any Security Registrar or any other agent of Parent, the Issuer or of the Trustee, in its individual or any other capacity, may become the owner or pledgee
of Securities and, subject to TIA Sections 310(b) and 311, may otherwise deal with Parent, the Issuer with the same rights it would have if it were not any 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 in writing with the Issuer. 


        SECTION
607. Compensation and Reimbursement.


        The
Issuer agrees: 



        (1)   to
pay to the Trustee from time to time such compensation as shall be agreed in writing between the Issuer and the Trustee 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 the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the
Trustee 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 the Trustee's negligence, willful misconduct or bad faith; and 



        (3)   to
indemnify each of the Trustee and any predecessor trustee and its directors, officers, employees and agents for, and to hold them harmless against, any and all loss,
liability, damage, claim or expense including taxes (other than taxes based on the income of the Trustee) incurred without negligence, willful misconduct or bad faith on the part of any of them,
arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending itself or themselves against any claim (whether asserted by the
Issuer, a Guarantor, a Holder or any other Person) or liability in connection with the exercise or performance of any of its or their powers or duties hereunder. 




        The
obligations of the Issuer under this Section 607 to compensate the Trustee, to pay or reimburse the Trustee for expenses, disbursements and advances and to indemnify and hold
harmless the Trustee shall constitute additional indebtedness hereunder. As security for the performance of such obligations of the Issuer, the Trustee shall have a claim prior to the Securities upon
all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of (and premium, if any, on) or interest on particular Securities. 


        When
the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 501(9) or (10), the expenses (including the reasonable
charges and expenses of its counsel) of and the compensation for such services are intended to constitute expenses of administration under any applicable federal, state or foreign bankruptcy,
insolvency or other similar law. 


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


        SECTION
608. Corporate Trustee Required; Eligibility; Conflicting Interests.



        (a)   There
shall be at all times a Trustee hereunder which shall be subject to and comply with the provisions of Section 310(a)(1) of the Trust Indenture Act
and shall have a combined capital and 


38





 



surplus
of at least $50,000,000. If such Person publishes reports of condition at least annually, pursuant to law or to the requirements of federal, state, territorial or District of Columbia
supervising or examining authority, then, for the purposes of this Section 608, the combined capital and surplus of such Person 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 a Responsible Officer of the Trustee shall have actual knowledge that the Trustee ceases to be eligible in accordance with the
provisions of this Section 608, it shall resign immediately in the manner and with the effect hereinafter specified in this Article VI. 


        (b)   The
Trustee shall be subject to and comply with Section 310(b) of the Trust Indenture Act. 


        SECTION
609. 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 VI shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable requirements of Section 610. 


        (b)   The
Trustee may resign at any time by giving written notice thereof to the Issuer. If the instrument of acceptance by a successor Trustee required by Section 610
shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition, at the expense of the Issuer, any court of
competent jurisdiction for the appointment of a successor Trustee. 



        (c)   The
Trustee may be removed at any time by Act of the Holders of not less than a majority in aggregate principal amount of the Outstanding Securities, delivered to the
Trustee and to the Issuer. If the instrument of acceptance by a successor Trustee required by Section 610 shall not have been delivered to the Trustee within 30 days after the giving of
such notice of removal, the Trustee designated for removal may petition, at the expense of the Issuer, any court of competent jurisdiction for the appointment of a successor Trustee. 


        (d)   If
at any time: 



        (1)   the
Trustee shall fail to comply with the provisions of TIA Section 310(b) after written request therefor by the Issuer 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 608(a) and shall fail to resign after written request therefor by the Issuer or by any Holder who has
been a bona fide Holder of a Security for at least six months, 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 Issuer, by a Board Resolution, may remove the Trustee or (ii) subject to TIA Section 3.15(e), 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 and the appointment of
a successor Trustee. 


        (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, the Issuer, by a Board
Resolution, shall promptly appoint a successor Trustee. If the Issuer does not promptly appoint a successor Trustee after such resignation, removal or incapability, or the occurrence of such vacancy,
a successor Trustee shall be appointed by Act of the Holders of a majority in aggregate principal amount of the Outstanding Securities delivered to the Issuer and the retiring Trustee. In either case,
the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment, become the successor Trustee and supersede the successor 


39





 



Trustee
appointed by the Issuer. If no successor Trustee shall have been so appointed by the Issuer or the Holders and accepted appointment in the manner hereinafter provided, 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 appointment of a
successor Trustee. 


        (f)    The
Issuer shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee to the Holders of Securities in the manner
provided for in Section 106. Each notice shall include the name of the successor Trustee and the address of its Corporate Trust Office. 


        (g)   The
retiring Trustee shall not be liable for any of the acts or omissions of any successor Trustee appointed hereunder. 


        SECTION
610. Acceptance of Appointment by Successor.



        Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to the Issuer 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 retiring Trustee; but, on request of the Issuer 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. Upon request of any such successor Trustee, the Issuer 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. 


        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 VI. 


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


        Any
Person into which the Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Person succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder;  provided that such Person
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 successor by merger, conversion,
consolidation or transfer of assets 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. In case at that time any of the Securities shall not have been authenticated, any successor Trustee may authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor Trustee. In all such cases such certificates shall have the full force and effect which this Indenture provides that the certificate of
authentication of the Trustee shall have; provided, however, that the right to adopt the certificate of
authentication of any predecessor Trustee or to authenticate Securities in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion, consolidation or
transfer of assets. 


ARTICLE SEVEN  


 HOLDERS' LISTS AND REPORTS BY TRUSTEE AND THE ISSUER  


        SECTION 701. Disclosure of Names and Addresses of Holders.


        Every
Holder of Securities, by receiving and holding the same, agrees with the Issuer and the Trustee that none of the Issuer or the Trustee or any agent of any of them shall be held
accountable by 


40





 



reason
of the disclosure of any such information as to the names and addresses of the Holders in accordance with TIA Section 3.12, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under TIA Section 3.12(b). 


        SECTION
702. Reports by Trustee.


        Within
60 days after May 15 of each year commencing with the first May 15 after the first issuance of Securities, the Trustee shall transmit to the Holders, in the
manner and to the extent provided in TIA Section 313(c), a brief report dated as of such May 15 if required by TIA Section 313(a). 


        A
copy of each such report at the time of its mailing to Holders shall be filed with the Commission and the principal national securities exchange (if any) on which the Securities are
listed. 


        The
Issuer shall promptly notify a Responsible Officer of the Trustee if the Securities become listed on any national securities exchange or of any delisting thereof. 


        SECTION
703. Reports by Parent and the Issuer.


        Parent
or the Issuer shall file with the Trustee and deliver to the Holders of Securities the reports and other information required to be provided by them pursuant to
Section 1007. 


ARTICLE EIGHT  


 CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE  


        SECTION 801. Parent May Consolidate, etc., Only on Certain Terms.



        Parent
shall not, in a single transaction or a series of related transactions, (i) consolidate with or merge into any other Person or Persons or permit any other Person to
consolidate with or merge into Parent or (ii) directly or indirectly, transfer, sell, lease, convey or otherwise dispose of all or substantially all its assets to any other Person or Persons
unless: 



        (1)   in
a transaction in which Parent is not the surviving Person or in which Parent transfers, sells, leases, conveys or otherwise disposes of all or substantially all of
its assets to any other Person, the resulting surviving or transferee Person (the "successor entity") is organized under the laws of the United States of America or any State thereof or the District
of Columbia and shall expressly assume, by a supplemental indenture executed and delivered to the Trustee in form satisfactory to the Trustee, all of Parent's obligations under the Indenture and the
Parent Guarantee; 


        (2)   immediately
before and after giving effect to such transaction and treating any Debt which becomes an obligation of Parent (or the successor entity) or a Restricted
Subsidiary as a result of such transaction as having been Incurred by Parent or such Restricted Subsidiary at the time of the transaction, no Default or Event of Default shall have occurred and be
continuing; 


        (3)   immediately
after giving effect to such transaction, the Consolidated Net Worth of Parent (or the successor entity) is equal to or greater than that of Parent
immediately prior to the transaction; 


        (4)   immediately
after giving effect to such transaction and treating any Debt which becomes an obligation of Parent (or the successor entity) or a Restricted Subsidiary as a
result of such transaction as having been Incurred by Parent or such Restricted Subsidiary at the time of the transaction, Parent (or the successor entity) could Incur at least $1.00 of additional
Debt pursuant to paragraph (a) of Section 1010; 



41





 




        (5)   if,
as a result of any such transaction, Property of Parent (or the successor entity) or any Restricted Subsidiary would become subject to a Lien prohibited by
Section 1014, Parent or the successor entity to Parent shall have secured the Securities as required by said covenant; 


        (6)   in
the case of a transfer, sale, lease, conveyance or other disposition of all or substantially all of the assets of Parent, such assets shall have been transferred as
an entirety or virtually as an entirety to one Person and such Person shall have complied with all the provisions of this paragraph; and 


        (7)   Parent
and the Issuer have delivered to the Trustee an Officers' Certificate and Opinion of Counsel, each in form and substance reasonably satisfactory to the Trustee,
stating that such consolidation, merger, transfer, sale, lease, conveyance or other disposition and, if a supplemental indenture is required in connection with such transaction, such supplemental
indenture, complies with this Article and that all conditions precedent herein have been complied with, and, with respect to such Officers' Certificate, setting forth the manner of
determination of the Consolidated Net Worth, in accordance with clause (3) of this Section 801, of Parent or, if applicable, of the successor entity as required pursuant to the
foregoing. 




        SECTION
802. Successor Parent Substituted.


        Upon
any consolidation of Parent with or merger of Parent with or into any other Person or any transfer, sale, lease, conveyance or other disposition of all or substantially all the
assets of Parent to any Person or Persons in accordance with Section 801, the successor Person formed by such consolidation or into which Parent is merged or to which such transfer, sale,
lease, conveyance or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of, Parent under this Indenture with the same effect as if such
successor Person had been named as Parent herein, and the predecessor Parent (which term shall for this purpose mean the Person named as "Parent" in the first paragraph of this Indenture or any
successor Person which shall have become such in the manner described in Section 801), except in the case of a lease, shall be released from all its obligations and covenants under this
Indenture and the Securities and may be dissolved and liquidated. 


        SECTION
803. Issuer May Consolidate, etc., Only on Certain Terms.



        The
Issuer shall not, in a single transaction or a series of related transactions, (i) consolidate or merge into Parent or permit Parent to consolidate with or merge into the
Issuer or (ii) except to the extent permitted under Section 1012, directly or indirectly, transfer, sell, lease, convey or otherwise dispose of all or substantially all its assets to
Parent. Additionally, the Issuer shall not, in a single transaction or a series of related transactions, (i) consolidate with or merge into any other Person or Persons or permit any other
Person to consolidate with or merge into the Issuer or (ii) (other than, to the extent permitted under Section 1012, to a Restricted Subsidiary that is or becomes a Guarantor and an
Offering Proceeds Note Guarantor or to Parent so long as Parent is a Guarantor) directly or indirectly,
transfer, sell, lease, convey or otherwise dispose of all or substantially all its assets to any other Person or Persons, unless: 



        (1)   in
a transaction in which the Issuer is not the surviving Person or in which the Issuer transfers, sells, leases, conveys or otherwise disposes of all or substantially
all of its assets to any other Person, the successor entity is organized under the laws of the United States of America or any State thereof or the District of Columbia and shall expressly assume, by
a supplemental indenture executed and delivered to the Trustee in form satisfactory to the Trustee, all of the Issuer's obligations under this Indenture; 



        (2)   immediately
before and after giving effect to such transaction and treating any Debt which becomes an obligation of the Issuer (or the successor entity) or an Issuer
Restricted Subsidiary as a result of such transaction as having been Incurred by the Issuer or such Issuer 



42





 




Restricted
Subsidiary at the time of the transaction, no Default or Event of Default shall have occurred and be continuing; 



        (3)   immediately
after giving effect to such transaction, the Consolidated Net Worth of the Issuer (or the successor entity) is equal to or greater than that of the Issuer
immediately prior to the transaction; 


        (4)   immediately
after giving effect to such transaction and treating any Debt which becomes an obligation of the Issuer (or the successor entity) or an Issuer Restricted
Subsidiary as a result of such transaction as having been Incurred by the Issuer or such Issuer Restricted Subsidiary at the time of the transaction, the Issuer (or the successor entity) could Incur
at least $1.00 of additional Debt pursuant to paragraph (a) of Section 1011; 



        (5)   if,
as a result of any such transaction, Property of the Issuer (or the successor entity) or any Issuer Restricted Subsidiary would become subject to a Lien prohibited
by the provisions of Section 1014, the Issuer or the successor entity to the Issuer shall have secured the Securities as required by said covenant; 


        (6)   in
the case of a transfer, sale, lease, conveyance or other disposition of all or substantially all of the assets of the Issuer, such assets shall have been transferred
as an entirety or virtually as an entirety to one Person and such Person shall have complied with all the provisions of this paragraph; and 



        (7)   Parent
and the Issuer have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each in form and substance reasonably satisfactory to the
Trustee, stating that such consolidation, merger, transfer, sale, lease, conveyance or other disposition and, if a supplemental indenture is required in connection with such transaction, such
supplemental indenture, complies with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with, and, with respect to such
Officers' Certificate, setting forth the manner of determination of the Consolidated Net Worth, in accordance with clause (3) of this Section 803, of the Issuer or, if applicable,
of the successor entity as required pursuant to the foregoing. 




        SECTION
804. Successor Issuer Substituted.


        Upon
any consolidation of the Issuer with or merger of the Issuer with or into any other Person or any transfer, sale, lease, conveyance or other disposition of all or substantially all
the assets of the Issuer to any Person or Persons in accordance with Section 803, the successor Person formed by such consolidation or into which the Issuer is merged or to which such transfer,
sale, lease, conveyance or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture with the same effect as if
such successor Person had been named as the Issuer herein, and the predecessor Issuer (which term shall for this purpose mean the Person named as the "Issuer" in the first paragraph of this Indenture
or any successor Person which shall have become such in the manner described in Section 803), except in the case of a lease, shall be released from all its obligations and covenants under this
Indenture and the Securities and may be dissolved and liquidated. 


        SECTION
805. Guarantor (other than Parent) May Consolidate, etc., Only on Certain Terms.


        A
Guarantor (other than Parent) shall not, in a single transaction or a series of related transactions, (i) consolidate with or merge into any other Person or Persons (other than,
with respect to a Guarantor that is an Issuer Restricted Subsidiary, the Issuer or another Guarantor that is an Issuer Restricted Subsidiary, and with respect to a Guarantor that is a Sister
Restricted Subsidiary, another Guarantor that is a Sister Restricted Subsidiary or Parent) or permit any other Person (other than, with respect to a Guarantor that is an Issuer Restricted Subsidiary,
another Guarantor that is an Issuer 


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Restricted
Subsidiary, and with respect to a Guarantor that is a Sister Restricted Subsidiary, Parent or another Guarantor that is a Sister Restricted Subsidiary) to consolidate with or merge into
such Guarantor or (ii) except to another Guarantor to the extent permitted under Section 1012, directly or indirectly, transfer, sell, lease, convey or otherwise dispose of all or
substantially all its assets to any other Person or Persons (other than, with respect to a Guarantor that is an Issuer Restricted Subsidiary, the Issuer or another Guarantor that is an Issuer
Restricted Subsidiary, and with respect to a Guarantor that is a Sister Restricted Subsidiary, another Guarantor that is a Sister Restricted Subsidiary or Parent), unless: 



        (1)   immediately
before and after giving effect to such transaction and treating any Debt which becomes an obligation of such Guarantor as a result of such transaction as
having been Incurred by such Guarantor at the time of the transaction, no Default or Event of Default shall have occurred and be continuing; 


        (2)   either
(A) in a transaction in which such Guarantor is not the surviving Person or in which such Guarantor transfers, sells, leases, conveys or otherwise disposes
of all or substantially all of its assets to any other Person, the resulting surviving or transferee Person is organized under the laws of the United States of America or any State thereof or the
District of Columbia and shall expressly assume, by a supplemental indenture executed and delivered to the Trustee in form satisfactory to the Trustee, all of such Guarantor's obligations under the
Indenture and its Note Guarantee; or (B) such transaction complies with Section 1016 (or Parent certifies in an Officers' Certificate to the Trustee that it will comply with the
requirements of such covenant relating to application of the proceeds of such transaction); and 


        (3)   Parent
and the Issuer have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each in form and substance reasonably satisfactory to the
Trustee, stating that such consolidation, merger, transfer, sale, lease, conveyance or other disposition and, if a supplemental indenture is required in connection with such transaction, such
supplemental indenture, complies with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with. 




        SECTION
806. Successor Guarantor Substituted.


        Upon
any consolidation of a Guarantor with or merger of a Guarantor with or into any other Person or any transfer, sale, lease, conveyance or other disposition of all or substantially
all the assets of a Guarantor to any Person or Persons in accordance with Section 805, the successor Person formed by such consolidation or into which such Guarantor is merged or to which such
transfer, sale, lease, conveyance or other disposition is made (other than any such transaction made in accordance with Section 8.05(2)(B)) shall succeed to, and be substituted for, and may
exercise every right and power of, such Guarantor under this Indenture with the same effect as if such successor Person had been named as a Guarantor herein, and the predecessor Guarantor (which term
shall for this purpose mean the Person named as the "New Guarantor" in the first paragraph of the applicable supplemental indenture or any successor Person which shall have become such in the manner
described in Section 805), except in the case of a lease, shall be released from all its obligations and covenants under its Note Guarantee and the Securities and may be dissolved and
liquidated. 


        SECTION
807. Offering Proceeds Note Guarantor May Consolidate, etc., Only on Certain Terms.



        An
Offering Proceeds Note Guarantor shall not, in a single transaction or a series of related transactions, (i) consolidate with or merge into any other Person or Persons
(other than, with respect to an Offering Proceeds Note Guarantor that is an Issuer Restricted Subsidiary, the Issuer or another Offering Proceeds Note Guarantor that is an Issuer
Restricted Subsidiary, and with respect to an Offering Proceeds Note Guarantor that is a Sister Restricted Subsidiary, another Offering Proceeds Note Guarantor that is a Sister
Restricted Subsidiary or Parent) or permit any other Person (other 


44





 



than,
with respect to an Offering Proceeds Note Guarantor that is an Issuer Restricted Subsidiary, another Offering Proceeds Note Guarantor that is an Issuer Restricted Subsidiary, and
with respect to an Offering Proceeds Note Guarantor that is a Sister Restricted Subsidiary, Parent or another Offering Proceeds Note Guarantor that is a Sister Restricted Subsidiary) to
consolidate with or merge into such Offering Proceeds Note Guarantor or (ii) except to another Offering Proceeds Note Guarantor to the extent permitted under Section 1012,
directly or indirectly, transfer, sell, lease, convey or otherwise dispose of all or substantially all its assets to any other Person or Persons (other than, with respect to an Offering Proceeds Note
Guarantor that is an Issuer Restricted Subsidiary, the Issuer or another Offering Proceeds Note Guarantor that is an Issuer Restricted Subsidiary, and with respect to an Offering Proceeds
Note Guarantor that is a Sister Restricted Subsidiary, another Offering Proceeds Note Guarantor that is a Sister Restricted Subsidiary or Parent), unless: 



        (1)   immediately
before and after giving effect to such transaction and treating any Debt which becomes an obligation of such Offering Proceeds Note Guarantor as a result of
such transaction as having been Incurred by such Offering Proceeds Note Guarantor at the time of the transaction, no Default or Event of Default shall have occurred and be continuing; 



        (2)   either
(a) in a transaction in which such Offering Proceeds Note Guarantor is not the surviving Person or in which such Offering Proceeds Note Guarantor
transfers, sells, leases, conveys or otherwise disposes of all or substantially all of its assets to any other Person, the resulting surviving or transferee Person is organized under the laws of the
United States of America or any State thereof or the district of Columbia and shall expressly assume all of such Offering Proceed Note Guarantor's obligations under the Offering Proceeds Note
Guarantee and any subordination agreement between the Issuer and such Offering Proceed Note Guarantor relating to the Offering Proceeds Note; or (b) such transaction complies with
Section 1016 (or Parent certifies in an Officers' Certificate to the Trustee that it will comply with the requirements of such covenant relating to application of the proceeds of such
transaction); and 


        (3)   Parent
and the Issuer have delivered to the Trustee and Officers' Certificate and an Opinion of Counsel, each in form and substance reasonably satisfactory to the
Trustee, stating that such consolidation, merger, transfer, sale, lease, conveyance or other disposition and, if a supplemental indenture is required in connection with such transaction, such
supplemental indenture, complies with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with. 



ARTICLE NINE  


 SUPPLEMENTAL INDENTURES  


        SECTION 901. Supplemental Indentures Without Consent of Holders.


        The
Issuer, the Guarantors and the Trustee may, at any time and from time to time, without notice to or consent of any Holders of Securities, enter into one or more indentures
supplemental hereto: 



        (1)   to
evidence the succession of another Person to the Issuer, Parent or any other Guarantor and the assumption by such successor of the covenants of the Issuer, Parent or
such other Guarantor, respectively, herein, in the Securities and the applicable Note Guarantee, as applicable; or 


        (2)   to
add to the covenants of Parent, the Issuer or any of their respective Subsidiaries, for the benefit of the Holders, or to surrender any right or power conferred upon
Parent, the Issuer or any other Guarantor hereby; or 


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



45







  



        (4)   to
provide for uncertificated Securities in addition to or in place of certificated Securities; or 


        (5)   to
evidence and provide for the acceptance of appointment hereunder of a successor Trustee pursuant to the requirements of Section 610; or 


        (6)   to
secure the Securities; or 


        (7)   to
comply with the Trust Indenture Act or the Securities Act (including Regulation S promulgated thereunder); or 


        (8)   to
add additional Note Guarantees or to release any Guarantors from Note Guarantees as provided by the terms of this Indenture; or 


        (9)   as
set forth in Section 1308; or 


        (10) to
cure any ambiguity herein, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to add any other provision
with respect to matters or questions arising under this Indenture; provided such actions shall not adversely affect the interests of the Holders in any
material respect. 




        SECTION
902. Supplemental Indentures With Consent of Holders.


        With
the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities, by Act of such Holders delivered to the Issuer and the Trustee, the Issuer,
the Guarantors and the Trustee may enter into one or more indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or waiving or otherwise modifying in any manner the rights of the Holders, including the waiver of certain past defaults under the Indenture pursuant to Section 513;  provided,
however, that no such supplemental indenture shall, without the consent of the Holder of each
Outstanding Security (or, in the case of
clause (10) below, two-thirds in principal amount of the Outstanding Securities) affected thereby: 



        (1)   change
the Stated Maturity of the principal of, or any installment of interest on, any Security, or reduce the principal amount thereof or the interest thereon that
would be due and payable upon the Stated Maturity thereof, or change the place of payment where, or the coin or currency in which, any Security or any premium or interest thereon is payable, or impair
the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof; or 


        (2)   modify
any provision of Section 508 or Section 513; or 


        (3)   subordinate
in right of payment, or otherwise subordinate, the Securities or any Note Guarantee to any other Debt (other than as set forth in
Section 1308); or 


        (4)   except
as otherwise required herein, release any security interest that may have been granted in favor of the Holders of the Securities; or 


        (5)   reduce
the premium payable upon the redemption of any Security nor change the time at which any Security may be redeemed, as described in Exhibit A; or 


        (6)   reduce
the premium payable upon a Change of Control Triggering Event or, at any time after a Change of Control Triggering Event has occurred, change the time at which
the Offer to Purchase relating thereto must be made or at which the Securities must be repurchased pursuant to such Offer to Purchase; or 



46





 




        (7)   at
any time after the Issuer is obligated to make an Offer to Purchase with the Net Available Proceeds from Asset Dispositions, change the time at which such Offer to
Purchase must be made or at which the Securities must be repurchased pursuant thereto; or 



        (8)   make
any change in any Note Guarantee that would adversely affect the Holders of the Securities (other than as set forth in Section 1308); 


        (9)   modify
any provision of this Section 902 (except to increase any percentage set forth herein); or 


        (10) modify
or amend Section 1020. 




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


        SECTION
903. Execution of Supplemental Indentures.


        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 receive, and shall be fully protected in relying upon, an Opinion of Counsel of the Issuer stating that the execution of such supplemental indenture is authorized or
permitted by this Indenture and an Officers' Certificate of the Issuer stating that all conditions precedent to the execution of such supplemental indenture have been fulfilled. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. 


        SECTION
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 as a matter of contract or law to the requirements of the Trust Indenture Act as then in effect. 


        SECTION
906. Reference in Securities to Supplemental Indentures.


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


        SECTION
907. Notice of Supplemental Indentures.


        Promptly
after the execution by the Issuer, the Guarantors and the Trustee of any supplemental indenture pursuant to this Article Nine, the Issuer shall give notice thereof to the
Holders of each Outstanding Security affected, in the manner provided for in Section 106, setting forth in general terms the substance of such supplemental indenture. 


47





 


ARTICLE TEN  


 COVENANTS  


        SECTION 1001. Payment of Principal, Premium, if Any, and Interest.


        The
Issuer covenants and agrees for the benefit of the Holders that it shall duly and punctually pay the principal of (and premium, if any) and interest on the Securities in accordance
with the terms of the Securities and this Indenture. 


        SECTION
1002. Maintenance of Office or Agency.


        The
Issuer shall maintain in The City of New York an office or agency where Securities may be presented or surrendered for payment, where Securities may be surrendered for registration
of transfer or exchange and where notices and demands to or upon the Issuer in respect of the Securities and this Indenture may be served. The Corporate Trust Office of the Trustee shall be such
office or agency of the Issuer, unless the Issuer shall designate and maintain some other office or agency for one or more of such purposes. The Issuer shall give prompt written notice to the Trustee
of any change in the location of any such office or agency. If at any time the Issuer 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,
and the Issuer hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands. 


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


        SECTION
1003. Money for Security Payments to Be Held in Trust.


        If
the Issuer shall at any time act as its own Paying Agent, it shall, on or before each due date of the principal of (or premium, if any) or interest on any of the Securities, segregate
and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal of (or 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 shall promptly notify the Trustee of its action or failure so to act. 


        Whenever
the Issuer shall have one or more Paying Agents for the Securities, it shall, on or before each due date of the principal of (or premium, if any) or interest on any Securities,
deposit with a Paying Agent a sum 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 Issuer will promptly notify the Trustee of such action or any failure so to act. 



        The
Issuer shall cause each Paying Agent (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 shall: 



        (1)   hold
all sums held by it for the payment of the principal of, premium, if any, or interest on Securities 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 Issuer (or any other obligor upon the Securities) in the making of any payment of principal, premium, if any, or interest; 



48





 




        (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; and 


        (4)   indemnify
the Trustee and its officers, directors, employees and agents against any loss, cost or liability caused by, or incurred as a result of, such Paying Agent's
acts or omissions. 




        The
Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Issuer Order direct any Paying Agent to
pay, to the Trustee all sums held in trust by the Issuer 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 Issuer 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 sums. 



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


        SECTION
1004. Corporate Existence.


        Subject
to Article Eight, Parent and the Issuer shall do or cause to be done all things necessary to preserve and keep in full force and effect the corporate existence, rights
(charter and statutory) and franchises of Parent, the Issuer and each Subsidiary of the Issuer; provided,  however, that Parent and the Issuer shall not be
required to preserve, with respect to Parent or the Issuer, respectively, any such
right or franchise or, with respect to any such Subsidiary (subject to all the other covenants in this Indenture), any such corporate existence, right or franchise, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of the business of Parent and its Subsidiaries taken as a whole or the Issuer and its Subsidiaries taken as a whole,
respectively and that, in each case, the loss thereof is not disadvantageous in any material respect to the Holders. 


        SECTION
1005. Maintenance of Properties.


        The
Issuer shall cause all properties owned by the Issuer or any Issuer Restricted Subsidiary or used or held for use in the conduct of its business or the business of any Issuer
Restricted Subsidiary to be maintained and kept in good condition, repair and working order and supplied with all necessary equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of the Issuer may be necessary so that the business carried on in connection therewith may be properly and advantageously
conducted at all times; provided, however, that nothing in this Section 1005 shall prevent the
Issuer from discontinuing the maintenance of any of such properties if such discontinuance is, in the judgment of the Issuer, desirable in the conduct of its business or the business of any Subsidiary
and not disadvantageous in any material respect to the Holders. 


49





 



        SECTION
1006. Insurance.


        The
Issuer shall at all times keep all of its and each Issuer Restricted Subsidiary's properties which are of an insurable nature insured with insurers, believed by the Issuer to be
responsible, against loss or damage to the extent that property of similar character is usually so insured by companies similarly situated and owning like properties. 


        SECTION
1007. Reports.


        Whether
or not Parent is subject to Section 13(a) or 15(d) of the Exchange Act, or any successor provision thereto, Parent shall file with the Commission the annual
reports, quarterly reports and other documents which Parent would have been required to file with the Commission pursuant to such Section 13(a) or 15(d) or any successor provision
thereto if Parent were subject thereto, such documents to be filed with the Commission on or prior to the respective dates (the "Required Filing Dates") by which Parent would have been required to
file them. Parent or the Issuer shall also in any event (a) within 15 days of each Required Filing Date (i) transmit by mail to all Holders, as their names and addresses appear in
the Security Register, without cost to such Holders, and (ii) file with the Trustee copies of the annual reports, quarterly reports and other documents (without exhibits) which Parent
would have been required to file with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act or any successor provisions thereto if Parent were subject thereto and
(b) if filing such documents by Parent with the Commission is not permitted under the Exchange Act, promptly upon written request, supply copies of such documents (without exhibits) to any
prospective Holder. 


        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 Issuer's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates). 


        SECTION
1008. Statement by Officers as to Default.


        (a)   The
Issuer shall deliver to the Trustee, on the date of delivery of each annual report to be delivered pursuant to Section 1007, a brief certificate from the
principal executive officer, principal financial officer or principal accounting officer as to his or her knowledge of the Issuer's compliance during the period covered by such report with all
conditions and covenants under this Indenture. If the signer has knowledge of any noncompliance that occurred during such period, the certificate shall describe its status and what action the Issuer
has taken or is taking or proposes to take with respect thereto. For purposes of this Section 1008(a), such compliance shall be determined without regard to any period of grace or requirement
of notice under this Indenture. 


        (b)   When
any Default has occurred and is continuing under this Indenture, or if the trustee for or the holder of any other evidence of Debt of the Issuer or any Issuer
Restricted Subsidiary gives any notice or takes any other action with respect to a claimed default (other than with respect to Debt in the principal amount of less than $25,000,000 or its foreign
currency equivalent at the time), the Issuer shall, within 30 days of such occurrence, notice or other action, deliver to the Trustee by registered or certified mail or by facsimile
transmission an Officers' Certificate specifying such event, notice or other action, its status and what action the Issuer is taking or purposes to take with respect thereto. 


        SECTION
1009. Change of Control Triggering Event.


        (a)   Upon
the occurrence of a Change of Control Triggering Event, each Holder shall have the right to require that the Issuer repurchase such Holder's Securities in whole or
in part in integral multiples of $1,000, in accordance with the procedures set forth in this Section 1009 and this Indenture. 


50





 



        (b)   Within
30 days of the occurrence of both a Change of Control and a Rating Decline with respect to the Securities (a "Change of Control Triggering Event"), the
Issuer will be required to make an Offer to Purchase all Outstanding Securities at a price in cash equal to 101% of the principal amount of the Securities on the purchase date, plus accrued and unpaid
interest (if any) to such purchase date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date). 


        (c)   The
Issuer and the Trustee shall perform their respective obligations for the Offer to Purchase as specified in the Offer. Prior to the Purchase Date, the Issuer shall
(i) accept for payment Securities or portions thereof tendered pursuant to the Offer, (ii) irrevocably deposit with the Paying Agent (or, if the Issuer is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1003) money sufficient to pay the Purchase Price of all Securities or portions thereof so accepted (provided that such deposit may be made no
later than 11:00 A.M. New York City time on the Purchase Date if the Issuer elects) and (iii) deliver or cause to be delivered to the Trustee all Securities so accepted together with an
Officers' Certificate stating the Securities or portions thereof accepted for payment by the Issuer. The Paying Agent shall promptly mail or deliver to Holders of Securities so accepted payment in an
amount equal to the Purchase Price, and the Trustee shall promptly authenticate and mail or deliver to such Holders a new Security or Securities equal in principal amount to any unpurchased portion of
the Security surrendered as requested by the Holder. Any Security not accepted for payment shall be promptly mailed or delivered by the Issuer to the Holder thereof. In the event that the aggregate
Purchase Price is less than the amount delivered by the Issuer to the Trustee or the Paying Agent, the Trustee or the Paying Agent, as the case may be, shall deliver the excess to the Issuer
immediately after the Purchase Date. 


        (d)   A
"Change of Control" means the occurrence of any of the following events: 



        (i)    if
any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act or any successor provisions to either of the foregoing),
including any group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act, other than
any one or more of the Permitted Holders, becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act, except that a person will be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of 35% or more of the
total voting power of the Voting Stock of Parent; provided, however, that the Permitted Holders are the
"beneficial owners" (as defined in Rule 13d-3 under the Exchange Act, except that a person will be deemed to have "beneficial ownership" of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, in the aggregate of a lesser percentage of the total voting power of the
Voting Stock of Parent than such other person or group (for purposes of this clause (i), such person or group shall be deemed to beneficially own any Voting Stock of a corporation (the
"specified corporation") held by any other corporation (the "parent corporation") so long as such person or group beneficially owns, directly or indirectly, in the aggregate a majority of the total
voting power of the Voting Stock of such parent corporation); or 


        (ii)   the
sale, transfer, assignment, lease, conveyance or other disposition, directly or indirectly, of all or substantially all the assets of (A) Parent and the
Restricted Subsidiaries, or (B) the Issuer and the Issuer Restricted Subsidiaries, in each case considered as a whole (other than a disposition of such assets as an entirety or virtually as an
entirety to a Wholly Owned Restricted Subsidiary or Parent or the Issuer, respectively, or one or more Permitted Holders) shall have occurred; or 


        (iii)  during
any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of Parent (together with any new
directors whose 



51





 




election
or appointment by such board or whose nomination for election by the shareholders of Parent was approved by a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of Parent
then in office; or 


        (iv)  the
shareholders of Parent or the Issuer shall have approved any plan of liquidation or dissolution of Parent or the Issuer, respectively. 




        (e)   The
Issuer shall not be required to make an Offer to Purchase upon a Change of Control Triggering Event if a third party makes the Offer to Purchase in the manner, at
the times and otherwise in compliance with the requirements set forth in this Indenture applicable to an Offer to Purchase made by the Issuer and purchases all Securities validly tendered and not
withdrawn under such Offer to Purchase. 


        (f)    In
the event that the Issuer makes an Offer to Purchase the Securities, the Issuer shall comply with any applicable securities laws and regulations, including any
applicable requirements of Section 14(e) of, and Rule 14e-1 under, the Exchange Act. To the extent that the provisions of any securities laws or regulations conflict
with provisions of this Section, the Issuer shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section by
virtue thereof. 


        SECTION
1010. Limitation on Consolidated Debt.


        (a)   Parent
shall not, and shall not permit any Restricted Subsidiary (other than to the extent permitted by paragraph (b) of Section 1011) to, directly
or indirectly, Incur any Debt; provided, however, that Parent or any Restricted Subsidiary (subject, in
the case of the Issuer and any Issuer Restricted Subsidiary, to Section 1011) may Incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net
proceeds thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and either (i) the ratio of (A) the aggregate
consolidated principal amount (or, in the case of Debt issued at a discount, the then-Accreted Value) of Debt of Parent and its Restricted Subsidiaries outstanding as of the most recent
available quarterly or annual balance sheet, after giving pro forma effect to the Incurrence of such Debt and any other Debt Incurred or repaid since such balance sheet date and the receipt and
application of the net proceeds thereof, to (B) Consolidated Cash Flow Available for Fixed Charges for Parent and its Restricted Subsidiaries for the four full fiscal quarters next preceding
the Incurrence of such Debt for which consolidated financial statements are available, would be less than 5.0 to 1.0, or (ii) Parent's Consolidated Capital Ratio as of the most recent available
quarterly or annual balance sheet, after giving pro forma effect to (x) the Incurrence of such Debt and any other Debt Incurred or repaid since such balance sheet date, (y) the issuance
of any Capital Stock (other than Disqualified Stock) of Parent since such balance sheet date, including the issuance of any Capital Stock to be issued concurrently with the Incurrence of such Debt,
and (z) the receipt and application of the net proceeds of such Debt or Capital Stock, as the case may be, is less than 2.25 to 1.0. 


        (b)   Notwithstanding
the foregoing limitation, Parent or any Restricted Subsidiary (other than the Issuer or any Issuer Restricted Subsidiary, except to the extent permitted
by Section 1011) may Incur any and all of the following (each of which shall be given independent effect): 



        (i)    Debt
under the Original Securities (including any Exchange Securities issued in exchange for such Original Securities), any Note Guarantee in respect of the
Original Securities (including any Exchange Securities issued in exchange for such Original Securities) or any Offering Proceeds Note Guarantee in respect of the Offering Proceeds Note; 


        (ii)   Debt
under Credit Facilities in an aggregate principal amount outstanding or available (together with the sum of (A) the amount of any outstanding Debt Incurred
pursuant to 



52





 




clause (ii) of
paragraph (b) of Section 1011, plus (B) the amount of all refinancing Debt outstanding or available pursuant to clause (vi) of
paragraph (b) of Section 1011 in respect of Debt previously Incurred pursuant to clause (ii) of paragraph (b) of Section 1011, plus
(C) the amount of all refinancing Debt outstanding or available pursuant to clause (viii) below in respect of Debt previously Incurred pursuant to this clause (ii)) at any
one time not to exceed the greater of (x) $500,000,000 and (y) 1.5 times Consolidated Cash Flow Available for Fixed Charges of Parent and its Restricted Subsidiaries for the four full
fiscal quarters next preceding the Incurrence of such Debt for which consolidated financial statements are available, which amount shall be permanently reduced by the amount of Net Available Proceeds
used to repay Debt under the Credit Facilities or any refinancing Debt in respect of the Credit Facilities Incurred pursuant to clause (vi) of paragraph (b) of
Section 1011 or clause (viii) below), and not reinvested in Telecommunications/IS Assets or used to purchase Securities or repay other Debt, pursuant to and as permitted by
Section 1016; 


        (iii)  Purchase
Money Debt; provided, however, that the amount of such
Purchase Money Debt does not exceed 100% of the cost of the construction, installation, acquisition, lease, development or improvement of the applicable Telecommunications/IS Assets; 


        (iv)  Subordinated
Debt of Parent; provided, however, that the aggregate
principal amount (or, in the case of Debt issued at a discount, the Accreted Value) of such Debt, together with any other outstanding Debt Incurred pursuant to this clause (iv), shall not
exceed $500,000,000 at any one time (which amount shall be permanently reduced by the amount of Net Available Proceeds used to repay Subordinated Debt of Parent, and not reinvested in
Telecommunications/IS Assets or used to purchase Securities or repay other Debt, pursuant to and as permitted by Section 1016), except to the extent such Debt in excess of $500,000,000
(A) is subordinated to all other Debt of Parent other than Debt Incurred pursuant to this clause (iv) in excess of such $500,000,000 limitation, (B) does not provide for
the payment of cash interest on such Debt prior to the Stated Maturity of the Securities and (C) (1) does not provide for payments of principal of such Debt at stated maturity or by way
of a sinking fund applicable thereto or by way of any mandatory redemption, defeasance, retirement or repurchase thereof by Parent (including any redemption, retirement or repurchase which is
contingent upon events or circumstances, but excluding any retirement required by virtue of the acceleration of any payment with respect to such Debt upon any event of default thereunder), in each
case on or prior to the Stated Maturity of the Securities, and (2) does not permit redemption or other retirement (including pursuant to an offer to purchase made by Parent but excluding
through conversion into capital stock of Parent, other than Disqualified Stock, without any payment by Parent or its Restricted Subsidiaries to the holders thereof) of such Debt at the option of the
holder thereof on or prior to the Stated Maturity of the Securities; 


        (v)   Debt
outstanding on the Measurement Date; 


        (vi)  Debt
owed by Parent to any Restricted Subsidiary or Debt owed by a Restricted Subsidiary to Parent or a Restricted Subsidiary;  provided, however, that
(A) any Person that Incurs Debt owed to Parent or a Sister Restricted
Subsidiary pursuant to this clause (vi) is a Guarantor and an Offering Proceeds Note Guarantor, (B) (x) upon the transfer, conveyance or other disposition by such
Restricted Subsidiary or Parent of any Debt so permitted to a Person other than Parent or another Restricted Subsidiary of Parent or (y) if for any reason such Restricted Subsidiary ceases to
be a Restricted Subsidiary, the provisions of this clause (vi) shall no longer be applicable to such Debt and such Debt shall be deemed to have been Incurred by the issuer thereof at the
time of such transfer, conveyance or other disposition or when such Restricted Subsidiary ceases to be a Restricted Subsidiary; and (C) the payment obligation of such Debt (if
clause (A) above applies) is expressly subordinated in any bankruptcy, liquidation or winding up proceeding of the obligor to the prior payment in full in cash of all obligations with
respect to the 



53





 




Offering
Proceeds Note Guarantee of such Offering Proceeds Note Guarantor; and provided further,  however, that a Foreign Restricted Subsidiary need not become
a Guarantor or an Offering Proceeds Note Guarantor pursuant to
clause (A) above until such time and only so long as such Foreign Restricted Subsidiary Guarantees any other Debt of Parent or any Domestic Restricted Subsidiary; 


        (vii) Debt
Incurred by a Person prior to the time (A) such Person became a Restricted Subsidiary, (B) such Person merges into or consolidates with a Restricted
Subsidiary or (C) another Restricted Subsidiary merges into or consolidates with such Person (in a transaction in which such Person becomes a Restricted Subsidiary), which Debt was not Incurred
in anticipation of such transaction and was outstanding prior to such transaction; 


        (viii)   Debt
Incurred to renew, extend, refinance, defease, repay, prepay, repurchase, redeem, retire, exchange or refund (each, a "refinancing") Debt Incurred
pursuant to clause (i), (ii), (iii), (v), (vii) or (xii) of this paragraph (b) or this clause (viii), in an aggregate principal amount (or if issued at a
discount, the then-Accreted Value) not to exceed the aggregate principal amount (or if issued at a discount, the then-Accreted Value) of and accrued interest on the Debt so
refinanced plus the amount of any premium required to be paid in connection with such refinancing pursuant to the terms of the Debt so refinanced or the amount of any premium reasonably determined by
the Board of Directors of Parent as necessary to accomplish such refinancing by means of a tender offer or privately negotiated repurchase, plus the expenses of Parent Incurred in connection with such
refinancing; provided, however, that (A) if the Person that originally Incurred the Debt to be
refinanced became, or would have been required to become if not already, a Guarantor or an Offering Proceeds Note Guarantor as a result of the Incurrence of the Debt being refinanced in
accordance with this covenant, (1) the Person that Incurs the refinancing Debt pursuant to this clause (viii) shall be a Guarantor and an Offering Proceeds Note Guarantor
and (2) if the Debt to be refinanced is subordinated to the Offering Proceeds Note Guarantee of such Offering Proceeds Note Guarantor, the refinancing Debt shall be subordinated
to the same extent to the Offering Proceeds Note Guarantee of the Offering Proceeds Note Guarantor Incurring such refinancing Debt, (B) the refinancing Debt shall not be senior in
right of payment to the Debt that is being refinanced and (C) in the case of any refinancing of Debt Incurred pursuant to clause (i), (v), (vii) or (xii) or, if such Debt
previously refinanced Debt Incurred pursuant to any such clause, this clause (viii), the refinancing Debt by its terms, or by the terms of any agreement or instrument pursuant to which such
Debt is issued, (x) does not provide for payments of principal of such Debt at stated maturity or by way of a sinking fund
applicable thereto or by way of any mandatory redemption, defeasance, retirement or repurchase thereof by Parent or any Restricted Subsidiary (including any redemption, retirement or repurchase which
is contingent upon events or circumstances, but excluding any retirement required by virtue of the acceleration of any payment with respect to such Debt upon any event of default thereunder), in each
case prior to the time the same are required by the terms of the Debt being refinanced and (y) does not permit redemption or other retirement (including pursuant to an offer to purchase made by
Parent or any Restricted Subsidiary) of such Debt at the option of the holder thereof prior to the time the same are required by the terms of the Debt being refinanced, other than, in the case of
clause (x) or (y), any such payment, redemption or other retirement (including pursuant to an offer to purchase made by Parent) which is conditioned upon a change of control pursuant to
provisions substantially similar to those described under Section 1009; 


        (ix)  Debt
(A) in respect of performance, surety or appeal bonds, Guarantees, letters of credit or reimbursement obligations Incurred or provided in the ordinary
course of business securing the performance of contractual, franchise, lease, self-insurance or license obligations and not in connection with the Incurrence of Debt or (B) in
respect of customary agreements providing for indemnification, adjustment of purchase price after closing, or similar obligations, or from 



54





 




Guarantees
or letters of credit, surety bonds or performance bonds securing any such obligations of Parent or any of its Restricted Subsidiaries pursuant to such agreements, Incurred in connection
with the disposition of any business, assets or Restricted Subsidiary of Parent (other than Guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or
Restricted Subsidiary of Parent for the purpose of financing such acquisition) and in an aggregate principal amount not to exceed the gross proceeds actually received by Parent or any Restricted
Subsidiary in connection with such disposition; 


        (x)   Debt
consisting of Permitted Interest Rate or Currency Protection Agreements; 


        (xi)  Debt
not otherwise permitted to be Incurred pursuant to clauses (i) through (x) above or clause (xii) below, which, together with any other
outstanding Debt Incurred pursuant to this clause (xi), has an aggregate principal amount not in excess of $50,000,000 at any time outstanding; and 



        (xii) Issue
Date Purchase Money Debt and Debt under the Existing Notes and the related indentures and any restricted subsidiary guarantees issued prior to the Issue Date in
accordance with such related indentures. 




        (c)   Notwithstanding
any other provision of this Section 1010, the maximum amount of Debt that Parent or any Restricted Subsidiary may Incur pursuant to this
Section 1010 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies. 


        (d)   For
purposes of determining any particular amount of Debt under this Section 1010, (i) Guarantees, Liens or obligations with respect to letters of credit
supporting Debt otherwise included in the determination of such particular amount shall not be included and (ii) any Liens granted for the benefit of the Securities pursuant to the provisions
referred to in Section 1014 shall not be treated as Debt. For purposes of determining compliance with this Section 1010, in the event that an item of Debt meets the criteria of more than
one of the types of Debt described in the above clauses, Parent, in its sole discretion, shall classify such item of Debt and only be required to include the amount and type of such Debt in one of
such clauses. 


        SECTION
1011. Limitation on Debt of the Issuer and Issuer Restricted Subsidiaries. (a) The Issuer shall not, and shall not permit
any Issuer Restricted Subsidiary to, directly or indirectly, Incur any Debt; provided, however, that
(i) the Issuer or (ii) any Issuer Restricted Subsidiary may incur any Debt if, after giving pro forma effect to such Incurrence and the receipt and application of the net proceeds
thereof, no Default or Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and the Issuer Debt Ratio would be less than 4.0 to 1.0;  provided,
however, that any Issuer Restricted Subsidiary that Incurs Debt pursuant to this
paragraph (a) is a Guarantor and an Offering Proceeds Note Guarantor. 



        (b)   Notwithstanding
the foregoing limitation, the Issuer or any Issuer Restricted Subsidiary may Incur any and all of the following (each of which shall be given independent
effect): 



        (i)    Debt
of the Issuer or any Issuer Restricted Subsidiary under the Original Securities (including any Exchange Securities issued in exchange for such Original Securities),
any Note Guarantee in respect of the Original Securities (including any Exchange Securities issued in exchange for such Original Securities) or any Offering Proceeds Note Guarantee in
respect of the Offering Proceeds Note; 



55







  



        (ii)   Debt
of the Issuer or any Issuer Restricted Subsidiary under Credit Facilities in an aggregate principal amount outstanding or available (together with the sum of
(A) the amount of any outstanding Debt Incurred pursuant to clause (ii) of paragraph (b) of Section 1010, plus (B) the amount of all refinancing Debt
outstanding or available pursuant to clause (viii) of paragraph (b) of Section 1010, plus (C) the amount of all refinancing Debt outstanding or available pursuant to
clause (vi) below in respect of Debt previously Incurred pursuant to this clause (ii)) at any one time not to exceed the greater of (x) $500,000,000 and (y) 1.5
times Consolidated Cash Flow Available for Fixed Charges of Parent and its Restricted Subsidiaries for the four full fiscal quarters next preceding the Incurrence of such Debt for which consolidated
financial statements are available, which amount shall be permanently reduced by the amount of Net Available Proceeds used to repay Debt under the Credit Facilities (or any refinancing Debt in respect
of the Credit Facilities Incurred pursuant to clause (viii) of paragraph (b) of Section 1010 or clause (vi) below), and not reinvested in
Telecommunications/IS Assets or used to purchase Securities or repay other Debt, pursuant to and as permitted by Section 1016; 


        (iii)  Debt
of the Issuer or any Issuer Restricted Subsidiary outstanding on the Measurement Date; 


        (iv)  Debt
owed by the Issuer to a Restricted Subsidiary, Debt owed by an Issuer Restricted Subsidiary to Parent or a Restricted Subsidiary (including Debt owed by an Issuer
Restricted Subsidiary to another Issuer Restricted Subsidiary), and Debt with an aggregate principal amount not in excess of $10,000,000 at any time outstanding owed by the Issuer to Parent or any
Sister Restricted Subsidiary; provided, however, that (A) any Issuer Restricted Subsidiary that
Incurs Debt owed to Parent or a Sister Restricted Subsidiary pursuant to this clause (iv) is a Guarantor and an Offering Proceeds Note Guarantor, (B)(x) upon the transfer,
conveyance or other disposition by such Issuer Restricted Subsidiary or the Issuer of any Debt so permitted to a Person other than the Issuer or another Issuer Restricted Subsidiary or (y) if
for any reason such Issuer Restricted Subsidiary ceases to be an Issuer Restricted Subsidiary, the provisions of this clause (iv) shall no longer be applicable to such Debt and such Debt
shall be deemed to have been Incurred by the issuer thereof at the time of such transfer, conveyance or other disposition or when such Issuer Restricted Subsidiary ceases to be an Issuer Restricted
Subsidiary and (C) the payment obligation of such Debt (if clause (A) above applies) is expressly subordinated in any bankruptcy, liquidation or winding up proceeding of the obligor to
the prior payment in full in cash of all obligations with respect to the Securities or the Offering Proceeds Note Guarantee of such Offering Proceeds Note Guarantor, respectively; and  provided further, however, that a Foreign Restricted Subsidiary need not become a Guarantor or an
Offering Proceeds Note Guarantor pursuant to clause (A) above until such time and only so long as such Foreign Restricted Subsidiary Guarantees any other Debt of Parent or any Domestic
Restricted Subsidiary; 


        (v)   Debt
Incurred by a Person (other than Parent or any Sister Restricted Subsidiary) prior to the time (A) such Person became an Issuer Restricted Subsidiary,
(B) such Person merges into or consolidates with an Issuer Restricted Subsidiary or (C) an Issuer Restricted Subsidiary merges into or consolidates with such Person (in a transaction in
which such Person becomes an Issuer Restricted Subsidiary),
which Debt was not Incurred in anticipation of such transaction and was outstanding prior to such transaction; provided,  however, that after giving effect
to the Incurrence of any Debt pursuant to this clause (v), the Issuer could Incur at least $1.00 of additional
Debt pursuant to paragraph (a) above computed using "5.0 to 1.0" rather than "4.0 to 1.0" as it appears therein and such Person or the Issuer Restricted Subsidiary into which such Person
merges or consolidates is a Guarantor and an Offering Proceeds Note Guarantor; 



        (vi)  Debt
of the Issuer or any Issuer Restricted Subsidiary Incurred to renew, extend, refinance, defease, repay, prepay, repurchase, redeem, retire, exchange or refund
(each, a "refinancing") Debt of the Issuer or any Issuer Restricted Subsidiary Incurred pursuant to 



56





 




clause (i),
(ii), (iii), (v) or (x) of this paragraph (b) or this clause (vi), in an aggregate principal amount (or if issued at a discount, the
then-Accreted Value) not to exceed the aggregate principal amount (or if issued at a discount, the then-Accreted Value) of and accrued interest on the Debt so refinanced plus
the amount of any premium required to be paid in connection with such refinancing pursuant to the terms of the Debt so refinanced or the amount of any premium reasonably determined by the Board of
Directors of Parent as necessary to accomplish such refinancing by means of a tender offer or privately negotiated repurchase, plus the expenses of the Issuer Incurred in connection with such
refinancing; provided, however, that (A) if the Person that originally Incurred the Debt to be
refinanced became, or would have been required to become if not already, a Guarantor or an Offering Proceeds Note Guarantor as a result of the Incurrence of the Debt being refinanced in
accordance with this covenant, (1) the Person that Incurs the refinancing Debt pursuant to this clause (vi) (if not the Issuer) shall be a Guarantor and an Offering Proceeds
Note Guarantor and (2) if the Debt to be refinanced is subordinated to the Offering Proceeds Note Guarantee of such Offering Proceeds Note Guarantor, the refinancing Debt
shall be subordinated to the same extent to the Offering Proceeds Note Guarantee of the Offering Proceeds Note Guarantor Incurring such refinancing Debt, (B) the refinancing Debt
shall not be senior in right of payment to the Debt that is being refinanced and (C) in the case of any refinancing of Debt Incurred pursuant to clause (i), (v) or (x) or,
if such Debt previously refinanced Debt Incurred pursuant to any such clause, this clause (vi), the refinancing Debt by its terms, or by the terms of any agreement or instrument pursuant to
which such Debt is issued, (x) does not provide for payments of principal of such Debt at stated maturity or by way of a sinking fund applicable thereto or by way of any mandatory redemption,
defeasance, retirement or repurchase thereof by the Issuer or any Issuer Restricted Subsidiary (including any redemption, retirement or repurchase which is contingent upon events or circumstances, but
excluding any retirement required by virtue of the acceleration of any payment with respect to such Debt upon any event of default thereunder), in each case prior to the time the same are required by
the terms of the Debt being refinanced and (y) does not permit redemption or other retirement (including pursuant to an offer to purchase made by the Issuer or an Issuer Restricted Subsidiary)
of such Debt at the option of the holder thereof prior to the time the same are required by the terms of the Debt being refinanced, other than, in the case of clause (x) or (y), any such
payment, redemption or other retirement (including pursuant to an offer to purchase made by the Issuer) which is conditioned upon a change of control pursuant to provisions substantially similar to
those described under Section 1009; 


        (vii) Debt
of the Issuer or any Issuer Restricted Subsidiary (A) in respect of performance, surety or appeal bonds, Guarantees, letters of credit or reimbursement
obligations Incurred or provided in the ordinary course of business securing the performance of contractual, franchise, lease,
self-insurance or license obligations and not in connection with the Incurrence of Debt or (B) in respect of customary agreements providing for indemnification, adjustment of
purchase price after closing, or similar obligations, or from Guarantees or letters of credit, surety bonds or performance bonds securing any such obligations of the Issuer or any Issuer Restricted
Subsidiary pursuant to such agreements, Incurred in connection with the disposition of any business, assets or Issuer Restricted Subsidiary (other than Guarantees of Indebtedness Incurred by any
Person acquiring all or any portion of such business, assets or Issuer Restricted Subsidiary for the purpose of financing such acquisition) and in an aggregate principal amount not to exceed the gross
proceeds actually received by the Issuer or any Issuer Restricted Subsidiary in connection with such disposition; 


        (viii)   Debt
of the Issuer or any Issuer Restricted Subsidiary consisting of Permitted Interest Rate or Currency Protection Agreements; 



57





 




        (ix)  Debt
of any Foreign Restricted Subsidiary of the Issuer not otherwise permitted to be Incurred pursuant to clause (i) through (viii) above or
clause (x) below, which, together with any other outstanding Debt Incurred pursuant to this clause (ix) has an aggregate principal amount not in excess of $100,000,000 at
any time outstanding; and 


        (x)   Issue
Date Purchase Money Debt initially Incurred by the Issuer or any Issuer Restricted Subsidiary or another Person that became an Issuer Restricted Subsidiary on or
before the Issue Date. 




        (c)   Notwithstanding
any other provision of this Section 1011, the maximum amount of Debt the Issuer or any Issuer Restricted Subsidiary may Incur pursuant to this
Section 1011 shall not be deemed to be exceeded due solely to the result of fluctuations in the exchange rates of currencies. 



        (d)   For
purposes of determining any particular amount of Debt under this Section 1011, (1) Guarantees (other than Guarantees of Debt of Parent or any Sister
Restricted Subsidiary that are not Guarantees of Debt Incurred by Parent or any Sister Restricted Subsidiary pursuant to clause (ii) of paragraph (b) of
Section 1010), Liens or obligations with respect to letters of credit supporting Debt otherwise included in the determination of such particular amount shall not be included and (2) any
Liens granted for the benefit of the Securities pursuant to the provisions referred to in Section 1014 described below shall not be treated as Debt. For purposes of determining compliance with
this Section 1011, in the event that an item of Debt meets the criteria of more than one of the types of Debt described in the above clauses, the Issuer, in its sole discretion, shall classify
such item of Debt and only be required to include the amount and type of such Debt in one of such clauses. 


        SECTION
1012. Limitation on Restricted Payments. (a) Parent (i) shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, declare or pay any dividend, or make any distribution, in respect of its Capital Stock or to the holders thereof, excluding any dividends or distributions which are made
solely to Parent or a Restricted Subsidiary (and, if such Restricted Subsidiary is not a Wholly Owned Subsidiary, to the other stockholders of such Restricted Subsidiary on a pro rata basis or on a
basis that results in the receipt by Parent or a Restricted Subsidiary of dividends or distributions of greater value than it would receive on a pro rata basis) or any dividends or distributions
payable solely in shares of Capital Stock of Parent (other than Disqualified Stock) or in options, warrants or other rights to acquire Capital Stock of Parent (other than Disqualified Stock);
(ii) shall not, and shall not permit any Restricted Subsidiary to, purchase, redeem, or otherwise retire or acquire for value (x) any Capital Stock of Parent or any Restricted Subsidiary
of Parent or (y) any options, warrants or rights to purchase or acquire shares of Capital Stock of Parent or any Restricted Subsidiary or any securities convertible or exchangeable into shares
of Capital Stock of Parent or any Restricted Subsidiary, except, in any such case, any such purchase, redemption or retirement or acquisition for value (A) paid to Parent or a Restricted
Subsidiary (or, in the case of any such purchase, redemption or other retirement or acquisition for value with respect to a Restricted Subsidiary that is not a Wholly Owned Subsidiary, to the other
stockholders of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by Parent or a Restricted Subsidiary of payments of greater value than it would receive on a
pro rata basis) or (B) paid solely in shares of Capital Stock (other than Disqualified Stock) of Parent; (iii) shall not make, or permit any Restricted Subsidiary to make, any Investment
(other than an Investment in Parent or a Restricted Subsidiary or a Permitted Investment) in any Person, including the Designation of any Restricted Subsidiary as an Unrestricted Subsidiary, or the
Revocation of any such Designation, according to Section 1019; (iv) shall not, and shall not permit any Restricted Subsidiary to, redeem, defease, repurchase, retire or otherwise acquire
or retire for value, prior to any scheduled maturity, repayment or sinking fund payment, Debt of Parent which is subordinate in right of payment to the Parent Guarantee or Debt of any Restricted
Subsidiary which is subordinate in right of payment to the Securities (in the case of the Issuer) or the Note Guarantee (in the case of Restricted Subsidiaries 


58





 



other
than the Issuer) of such Restricted Subsidiary (other than any redemption, defeasance, repurchase, retirement or other acquisition or retirement for value made in anticipation of satisfying a
scheduled maturity, repayment or sinking fund obligation due within one year thereof); and (v) shall not, and shall not permit any Restricted Subsidiary to, issue, transfer, convey, sell or
otherwise dispose of Capital Stock of any Restricted Subsidiary to a Person other than Parent or another Restricted Subsidiary if the result thereof is that such Restricted Subsidiary shall cease to
be a Restricted Subsidiary, in which event the amount of such "Restricted Payment" shall be the Fair Market Value of the remaining interest, if any, in such former Restricted Subsidiary held by Parent
and the other Restricted Subsidiaries (each of clauses (i) through (v) being a "Restricted Payment") if: (1) an Event of Default, or an event that with the passing of time or the
giving of notice, or both, would constitute an Event of Default, shall have occurred and be continuing, or (2) upon giving effect to such Restricted Payment, Parent could not Incur at least
$1.00 of additional Debt pursuant to paragraph (a) of Section 1010, or (3) upon giving effect to such Restricted Payment, the aggregate of all Restricted Payments made on
or after the Measurement Date, including Restricted Payments made pursuant to clause (A) or (B) of the proviso at the end of this sentence, and Permitted Investments made on or
after the Measurement Date pursuant to clause (i) or (j) of the definition thereof (the amount of any such Restricted Payment or Permitted Investment, if made other than in cash,
to be based upon Fair Market Value) exceeds the sum of: (a) 50% of cumulative Consolidated Net Income of Parent and its Restricted Subsidiaries (or, in the case that Consolidated Net Income of
Parent and its Restricted Subsidiaries shall be negative, 100% of such negative amount) since the end of the last full fiscal quarter prior to the Measurement Date through the last day of the last
full fiscal quarter ending at least 45 days prior to
the date of such Restricted Payment and (b) plus, in the case of any Revocation made after the Measurement Date, an amount equal to the lesser of the portion (proportionate to Parent's equity
interest in the Subsidiary to which such Revocation relates) of the Fair Market Value of the net assets of such Subsidiary at the time of Revocation and the amount of Investments previously made (and
treated as a Restricted Payment) by Parent or any Restricted Subsidiary in such Subsidiary; provided,  however, that Parent or a Restricted Subsidiary of
Parent may, without regard to the limitations in clause (3) but subject to clauses
(1) and (2), make (A) Restricted Payments in an aggregate amount not to exceed the sum of $50,000,000 and the aggregate net cash proceeds received after the Measurement Date
(i) as capital contributions to Parent, from the issuance (other than to a Subsidiary or an employee stock ownership plan or trust established by Parent or any such Subsidiary for the benefit
of their employees) of Capital Stock (other than Disqualified Stock) of Parent, and (ii) from the issuance or sale of Debt of Parent or any Restricted Subsidiary (other than to a Subsidiary,
Parent or an employee stock ownership plan or trust established by Parent or any such Subsidiary for the benefit of their employees) that after the Measurement Date has been converted into or
exchanged for Capital Stock (other than Disqualified Stock) of Parent and (B) Investments in Persons engaged in the Telecommunications/IS Business in an aggregate amount not to exceed the
after-tax gain on the sale, after the Measurement Date, of Special Assets to the extent sold for cash, Cash Equivalents, Telecommunications/IS Assets or the assumption of Debt of Parent or
any Restricted Subsidiary (other than Debt that is subordinated to the Securities, the Offering Proceeds Note or any applicable Note Guarantee or Offering Proceeds Note Guarantee) and
release of Parent and all Restricted Subsidiaries from all liability on the Debt assumed. The aggregate net cash proceeds referred to in the immediately preceding clauses (A)(i) and
(A)(ii) shall not be utilized to make Restricted Payments pursuant to such clauses to the extent such proceeds have been utilized to make Permitted Investments under clause (i) of
the definition of "Permitted Investments." 


        (b)   Notwithstanding
the foregoing limitation, (i) Parent may pay any dividend on Capital Stock of any class of Parent within 60 days after the declaration
thereof if, on the date when the dividend was declared, Parent could have paid such dividend in accordance with the foregoing provisions; provided,  however,
 that at the time of such payment of such dividend, no other Event of Default shall have occurred and be continuing (or result therefrom);
(ii) Parent may repurchase any shares of its Common 


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Stock
or options to acquire its Common Stock from Persons who were formerly directors, officers or employees of Parent or any of its Subsidiaries or other Affiliates in an amount not to exceed
$3,000,000 in any 12-month period; (iii) Parent and any Restricted Subsidiary may refinance any Debt otherwise permitted by clause (viii) of
paragraph (b) of Section 1010 or clause (vi) of paragraph (b) of Section 1011; (iv) Parent and any Restricted Subsidiary may retire or
repurchase any Capital Stock of Parent or of any Restricted Subsidiary or any Subordinated Debt of Parent in exchange for, or out of the proceeds of substantially concurrent sale (other than to a
Subsidiary of Parent or an employee stock ownership plan or trust established by Parent or any such Subsidiary for the benefit of their employees) of, Capital Stock (other than Disqualified Stock) of
Parent; provided, however, that the proceeds from any such exchange or sale of Capital Stock shall be
excluded from any calculation pursuant to clause (A)(i) in the proviso at the end of paragraph (a) above or pursuant to clause (b) of the definition of
"Invested Capital"; and (v) Parent may pay cash dividends in any amount not in excess of $50,000,000 in any 12-month period in respect of Preferred Stock of Parent (other than
Disqualified Stock). The Restricted Payments described in the foregoing clauses (i), (ii) and (v) shall be included in the calculation of Restricted Payments; the Restricted Payments
described in clauses (iii) and (iv) shall be excluded in the calculation of Restricted Payments. 



        (c)   The
Issuer may not, and may not permit any Issuer Restricted Subsidiary to, pay any dividend or make any distribution in respect of shares of its Capital Stock held by
Parent or a Sister Restricted Subsidiary (whether in cash, securities or other Property) or any payment (whether in cash, securities or other Property) on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any such shares of Capital Stock (all such dividends, distributions and payments being referred to herein as "Parent Transfers"), other than
(i) Parent Transfers at such times and in such amounts as shall be necessary to permit Parent to pay administrative expenses attributable to the operations of its Restricted Subsidiaries,
(ii) Parent Transfers at such times and in such amounts as are sufficient for Parent to make the timely payment of interest, premium (if any) and principal (whether at stated maturity, by way
of a sinking fund applicable thereto, by way of any mandatory redemption, defeasance, retirement or repurchase thereof, including upon the occurrence of designated events or circumstances or by virtue
of acceleration upon an event of default, or by way of redemption or retirement at the option of the holder of the Debt of Parent, including pursuant to offers to purchase) according to the terms of
any Debt of Parent, (iii) Parent Transfers (A) to permit Parent to satisfy its obligations in respect of stock option plans or other benefit plans for management or employees of Parent
and its Subsidiaries, (B) to permit Parent to pay dividends on Preferred Stock of Parent in an amount not to exceed the aggregate net cash proceeds received by Parent (1) after
September 30, 1999, from the issuance of Capital Stock, and (2) from the issuance or sale of Debt of Parent or any Restricted Subsidiary that after September 30, 1999, has been
converted into or exchanged for Capital Stock of Parent, (C) in an annual amount not to exceed 50% of Parent's Consolidated Net Income for the prior fiscal year and (D) Parent Transfers
in amounts not to exceed the amount required by Parent to pay accrued and unpaid interest on any Debt of Parent due upon the conversion, exchange or purchase of such Debt into, for or with Capital
Stock of Parent and (iv) additional Parent Transfers in an aggregate amount not to exceed $50,000,000 in the aggregate. 


        SECTION
1013. Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries.



        (a)   Parent
shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction (other than pursuant to law or regulation) on the ability of any Restricted Subsidiary (i) to pay dividends (in cash or otherwise) or make any other
distributions in respect of its Capital Stock owned by Parent or any other Restricted Subsidiary or pay any Debt or other obligation owed to Parent or any other Restricted Subsidiary, (ii) to
make loans or advances to Parent or any other Restricted Subsidiary or (iii) to transfer any of its Property to Parent or any other Restricted Subsidiary. 


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        (b)   Notwithstanding
the foregoing limitation, Parent may, and may permit any Restricted Subsidiary to, create or otherwise cause or suffer to exist (i) any
encumbrance or restriction pursuant to any agreement in effect on the Measurement Date, (ii) any customary (as conclusively determined in good faith by the Chief Financial Officer of Parent)
encumbrance or restriction applicable to a Restricted Subsidiary that is contained in an agreement or instrument governing or relating to Debt contained in any Qualified Credit Facility or Purchase
Money Debt; provided, however, that such encumbrances and restrictions permit the distribution of funds
to the Issuer in an amount sufficient for the Issuer to make the timely payment of interest, premium (if any) and principal (whether at stated maturity, by way of a sinking fund applicable thereto, by
way of any mandatory redemption, defeasance, retirement or repurchase thereof, including upon the occurrence of designated events or circumstances or by virtue of acceleration upon an event of
default, or by way of redemption or retirement at the option of the holder of the Debt, including pursuant to offers to purchase) according to the terms of this Indenture and the Securities and other
Debt that is solely an obligation of the Issuer, but provided further, however, that such agreement may
nevertheless contain customary (as so determined) net worth, leverage, invested capital and other financial covenants, customary (as so determined) covenants regarding the merger of or sale of all or
any substantial part of the assets of Parent or any Restricted Subsidiary, customary (as so determined) restrictions on transactions with affiliates and customary (as so determined) subordination
provisions governing Debt owed to Parent or any Restricted Subsidiary, (iii) any encumbrance or restriction pursuant to an agreement relating to any Acquired Debt, which encumbrance or
restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person so acquired, (iv) any encumbrance or restriction pursuant to an agreement effecting
a refinancing of Debt Incurred pursuant to an agreement referred to in clause (i), (ii) or (iii) of this paragraph (b);  provided, however, that the provisions contained in such agreement relating to such encumbrance or
restriction are no more restrictive (as so determined) in any material respect than the provisions contained in the agreement the subject thereof, (v) in the case of
clause (iii) of paragraph (a) above, any encumbrance or restriction contained in any security agreement (including a Capital Lease Obligation) securing Debt of Parent or a
Restricted Subsidiary otherwise permitted under this Indenture, but only to the extent such restrictions restrict the transfer of the Property subject to such security agreement, (vi) in the
case of clause (iii) of paragraph (a) above, customary provisions (A) that restrict the subletting, assignment or transfer of any Property that is a lease, license,
conveyance or similar contract, (B) contained in asset sale or other asset disposition agreements limiting the transfer of the Property being sold or disposed of pending the closing of such
sale or disposition or (C) arising or agreed to in the ordinary course of business, not relating to any Debt, and that do not, individually or in the aggregate, detract from the value of
Property of Parent or any Restricted Subsidiary in any manner material to Parent or any Restricted Subsidiary, (vii) any encumbrance or restriction with respect to a Restricted Subsidiary
imposed pursuant to an agreement which has been entered into for the sale or disposition of all or substantially all of the Capital Stock or Property of such Restricted Subsidiary;  provided,
however, that the consummation of such transaction would not result in a Default or an Event
of Default, that such restriction terminates if such transaction is abandoned and that the consummation or abandonment of such transaction occurs within one year of the date such agreement was entered
into, and (viii) any encumbrance or restriction pursuant to this Indenture and the Securities. 


        SECTION
1014. Limitation on Liens.


        Parent
shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, Incur or suffer to exist any Lien on or with respect to any Property now owned or acquired
after the Issue Date to secure any Debt without making, or causing such Restricted Subsidiary to make, effective provision for securing the Securities (x) equally and ratably with such Debt as
to such Property for so long as such Debt will be so secured or (y) in the event such Debt is Debt of the Issuer, Parent or a Restricted Subsidiary that is a Guarantor and such Debt is
subordinate in right of payment to the Securities, the Parent Guarantee or the applicable Note Guarantee, prior to such Debt as to such Property for so long 


61





 



as
such Debt will be so secured. The holders of such other secured Debt may exclusively control the disposition of the property subject to the Lien. 



        The
foregoing restrictions shall not apply to: (i) Liens existing on the Issue Date and securing Debt outstanding on the Issue Date or Liens Incurred on or after the Issue Date
pursuant to any Credit Facility to secure Debt permitted to be Incurred pursuant to clause (ii) of paragraph (b) under Section 1010 or clause (ii) of
paragraph (b) under Section 1011; (ii) Liens Incurred on or after the Measurement Date securing Debt of Parent or any Restricted Subsidiary (other than the Issuer or any
Issuer Restricted Subsidiary) in an amount which, together with the aggregate amount of Debt then outstanding or available under all Credit Facilities (together with all refinancing Debt then
outstanding or available pursuant to clause (viii) of paragraph (b) of Section 1010 or clause (vi) of paragraph (b) under
Section 1011 in respect of Debt previously Incurred under Credit Facilities), does not exceed 1.5 times Consolidated Cash Flow Available for Fixed Charges of Parent and its Restricted
Subsidiaries for the four full fiscal quarters preceding the Incurrence of such Lien for which Parent's consolidated financial statements are available, determined on a pro forma basis as if such Debt
had been Incurred and the proceeds thereof had been applied at the beginning of such four fiscal quarters; (iii) Liens in favor of Parent or any Restricted Subsidiary;  provided, however, that any subsequent issue or transfer of Capital Stock or other event that results in
any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of the Debt secured by any such Lien (except to Parent or a Restricted Subsidiary) shall be deemed, in
each case, to constitute the Incurrence of such Lien by the issuer thereof; (iv) Liens outstanding on the Issue Date securing Purchase Money Debt and Liens to secure Purchase Money Debt
Incurred after the Issue Date pursuant to clause (iii) of paragraph (b) under Section 1010, provided that any such
Lien may not extend to any Property other than the Telecommunications/IS Assets installed, constructed, acquired, leased, developed or improved with the proceeds of such Purchase Money Debt and any
improvements or accessions thereto (it being understood that all Debt to any single lender or group of related lenders or outstanding under any single credit facility, and in any case relating to the
same group or collection of Telecommunications/IS Assets financed thereby, shall be considered a single Purchase Money Debt, whether drawn at one time or from time to time); (v) Liens to secure
Acquired Debt, provided that (a) such Lien attaches to the acquired Property prior to the time of the acquisition of such Property and
(b) such Lien does not extend to or cover any other Property; (vi) Liens to secure Debt Incurred to refinance, in whole or in part, Debt secured by any Lien referred to in the foregoing
clauses (i), (iv) and (v) or this clause (vi) so long as such Lien does not extend to any other Property (other than improvements and accessions to the original Property) and the
principal amount of Debt so secured is not increased except as otherwise permitted under clause (viii) of paragraph (b) of Section 1010 or
clause (vi) of paragraph (b) of Section 1011; (vii) Liens Incurred on or after the Measurement Date not otherwise permitted by the foregoing clauses
(i) through (vi) (but including in the computations of Liens permitted under this clause (vii) Liens existing on the Issue Date which remain existing at the time of
computation which are otherwise permitted under clause (i)) securing Debt of Parent or any Restricted Subsidiary (other than the Issuer or any
Issuer Restricted Subsidiary) in an aggregate amount not to exceed 5% of Parent's Consolidated Tangible Assets; (viii) Liens on Property of any Non-Telecommunications Subsidiary;  provided,
however, that the Incurrence of such Lien does not require the Person Incurring such Lien to
secure any Debt of any Person other than a Non-Telecommunications Subsidiary; (ix) Liens granted after the Issue Date pursuant to this Section 1014 to secure the Securities;
(x) Liens to secure Debt Incurred pursuant to clause (viii) of paragraph (b) of Section 1011; and (xi) Permitted Liens. 


        SECTION
1015. Limitation on Sale and Leaseback Transactions.


        Parent
shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, enter into, assume, Guarantee or otherwise become liable with respect to any Sale and
Leaseback Transaction, unless (i) Parent or such Restricted Subsidiary would be entitled to Incur (a) Debt in an amount equal 


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to
the Attributable Value of the Sale and Leaseback Transaction pursuant to Section 1010 or Section 1011 and (b) a Lien pursuant to Section 1014, equal in amount to the
Attributable Value of the Sale and Leaseback Transaction, without also securing the Securities, and (ii) the Sale and Leaseback Transaction is treated as an Asset Disposition and all of the
conditions of Section 1016 (including the provisions concerning the application of Net Available Proceeds) are satisfied with respect to such Sale and Leaseback Transaction, treating all of the
consideration received in such Sale and Leaseback Transaction as Net Available Proceeds for purposes of such Section 1016. 


        SECTION
1016. Limitation on Asset Dispositions.


        Parent
shall not, and shall not permit any Restricted Subsidiary to, make any Asset Disposition unless: (i) Parent or the Restricted Subsidiary, as the case may be, receives
consideration for such disposition at least equal to the Fair Market Value for the Property sold or disposed of as determined by the Board of Directors of Parent in good faith and evidenced by a Board
Resolution of Parent filed with the Trustee; and (ii) at least 75% of the consideration for such disposition consists of cash or Cash Equivalents or the assumption of Debt of the Issuer or any
Issuer Restricted Subsidiary (other than Debt of the Issuer that is subordinated to the Securities or Debt of any Issuer Restricted Subsidiary that is subordinated to the Note Guarantee or
Offering Proceeds Note Guarantee of such Issuer Restricted Subsidiary) and release of the Issuer and all Issuer Restricted Subsidiaries from all liability on the Debt assumed (or if less than
75%, the remainder of such consideration consists of Telecommunications/IS Assets); provided, however,
that, to the extent such disposition involves Special Assets, all or any portion of the consideration may, at Parent's election, consist of Property other than cash, Cash Equivalents or the assumption
of Debt or Telecommunications/IS Assets. 


        The
Net Available Proceeds (or any portion thereof) from Asset Dispositions may be applied by Parent or a Restricted Subsidiary, to the extent Parent or such Restricted Subsidiary elects
(or is required by
the terms of any Debt): (1) to the permanent repayment or reduction of Debt then outstanding under any Qualified Credit Facility, to the extent such Qualified Credit Facility would require such
application or prohibit payments pursuant to the Offer to Purchase described in the following paragraph (other than Debt owed to Parent or any Affiliate of Parent); or (2) to reinvest in
Telecommunications/IS Assets (including by means of an Investment in Telecommunications/IS Assets by a Restricted Subsidiary with Net Available Proceeds received by Parent or another Restricted
Subsidiary). 


        Any
Net Available Proceeds from an Asset Disposition not applied in accordance with the preceding paragraph within 360 days (or, in the case of a disposition of Special Assets
identified in clause (a) of the definition thereof in which the Net Available Proceeds exceed $500,000,000, 540 days) from the date of the receipt of such Net Available Proceeds
shall constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $10,000,000, the Issuer (or, in the case of Debt of Parent required or permitted to be repurchased by Parent,
Parent) will be required to make an Offer to Purchase with such Excess Proceeds on a pro rata basis according to principal amount (or, in the case of Debt issued at a discount, the
then-Accreted Value) for (x) Outstanding Securities at a price in cash equal to 100% of the principal amount of the Securities on the purchase date plus accrued and unpaid interest
(if any) thereon (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date) and (y) any other Debt of the Issuer that
is pari passu with the Securities, any Debt of a Guarantor that is pari passu with such Guarantor's
Note Guarantee or any Debt of a Restricted Subsidiary that is a subsidiary of the Issuer but not a Guarantor, at a price no greater than 100% of the principal amount thereof plus accrued and
unpaid interest (if any) to the purchase date (or 100% of the then-Accreted Value plus accrued and unpaid interest (if any) to the purchase date in the case of original issue discount
Debt), to the extent, in the case of this clause (y), required under the terms thereof (other than Debt owed to Parent or any Affiliate of Parent). To the extent there are any remaining Excess
Proceeds following the completion of the Offer to Purchase, the Issuer shall apply such Excess Proceeds to the repayment of other Debt of 


63





 



the
Issuer or any Restricted Subsidiary that is a subsidiary of the Issuer, to the extent permitted or required under the terms thereof. Any other remaining Excess Proceeds may be applied to any use
as determined by Parent which is not otherwise prohibited by this Indenture, and the amount of Excess Proceeds shall be reset to zero. 



        The
Issuer, Parent and the Trustee shall perform their respective obligations for the Offer to Purchase as specified in the Offer. Prior to the Purchase Date, the Issuer, or Parent, as
applicable, shall (i) accept for payment Securities or portions thereof tendered pursuant to the Offer, (ii) irrevocably deposit with the Paying Agent (or, if the Issuer, or Parent, as
applicable, are acting as their own Paying Agent, segregate and hold in trust as provided in Section 1003) money sufficient to pay the Purchase Price of all Securities or portions thereof so
accepted (provided that such deposit may be made no later than 11:00 A.M. New York City time on the Purchase Date if the Issuer, or Parent, as applicable elect) and (iii) deliver or
cause to be delivered to the Trustee all Securities so accepted together with an Officers' Certificate stating the Securities or portions thereof accepted for payment. The Paying Agent shall promptly
mail or deliver to Holders of Securities so accepted payment in an amount equal to the Purchase Price, and the Trustee shall promptly authenticate and mail or deliver to such Holders a new Security or
Securities equal in principal amount to any unpurchased portion of the Security surrendered as requested by the Holder. Any Security not accepted for payment shall be promptly mailed or
delivered by the Issuer or Parent, as applicable, to the Holder thereof. In the event that the aggregate Purchase Price is less than the amount delivered by the Issuer or Parent, as applicable, to the
Trustee or the Paying Agent, the Trustee or the Paying Agent, as the case may be, shall deliver the excess to the Issuer or Parent, as applicable, immediately after the Purchase Date. 



        Not
later than the date upon which written notice of an Offer to Purchase is delivered to the Trustee, Issuer or Parent, as applicable, shall deliver to the Trustee an Officers'
Certificate as to (i) the amount of the Offer, (ii) the allocation of the Net Available Proceeds from the Asset Disposition pursuant to which such Offer is being made and
(iii) the compliance of such allocation with the provisions of this Section 1016. 


        In
the event that the Issuer or Parent, as applicable, make an Offer to Purchase the Securities, the Issuer or Parent, as applicable, shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule 14e-1 under, the Exchange Act. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Section, the Issuer or Parent, as applicable, shall comply with the applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue thereof. 


        The
Issuer shall not, and shall not permit any Issuer Restricted Subsidiary to, sell, transfer, lease or otherwise dispose of any Property to Parent or any Sister Restricted Subsidiary
unless (i) the Issuer or such Issuer Restricted Subsidiary receives consideration for such sale, transfer, lease or other disposition at least equal to the Fair Market Value of such Property
(which, in the case of the Offering Proceeds Note, is the principal amount of the Offering Proceeds Note and any accrued and unpaid interest thereon) and (ii) the consideration consists
of either (A) 100% in cash or Cash Equivalents or (B) Debt of Parent or the Restricted Subsidiary to which Property was transferred that is secured by a Lien on such transferred
Property. Parent or the Restricted Subsidiary to which Property was transferred for consideration consisting of Debt that is secured by a Lien on such Property in accordance with
clause (ii)(B) of the prior sentence may substitute the Lien on such Property with a Lien on other Property (including any Property owned by the Issuer or an Issuer Restricted
Subsidiary) that, as determined by the Board of Directors of Parent in good faith and evidenced by a Board Resolution of Parent filed with the Trustee upon request of the Trustee, has a Fair Market
Value of no less than the Fair Market Value of the Property for which the substitution is made at the time of the substitution. Any such Lien may be second in priority to any Lien on such Property in
favor of the lenders under a Qualified Credit Facility. The provisions of this paragraph do not apply to (a) dividends and distributions (other than any dividend or distribution of the Offering
Proceeds Note), (b) loans or advances and (c) purchases of services or goods. 


64







   
        SECTION 1017. Limitation on Issuance and Sales of Capital Stock of Restricted Subsidiaries.


        Parent
shall at all times own all the issued and outstanding Capital Stock of the Issuer. The Issuer shall at all times own all the issued and outstanding Capital Stock of Level 3 LLC.
Parent shall not, and shall not permit any Restricted Subsidiary to, issue, transfer, convey, sell or otherwise dispose of any shares of Capital Stock of a Restricted Subsidiary or securities
convertible or exchangeable into, or options, warrants, rights or any other interest with respect to, Capital Stock of a Restricted Subsidiary to any Person other than Parent or a Restricted
Subsidiary except (i) a sale of all of the Capital Stock of such Restricted Subsidiary owned by Parent and any Restricted Subsidiary that complies with the provisions of Section 1016 to
the extent such provisions apply, (ii) in a transaction that results in such Restricted Subsidiary becoming a Joint Venture, provided
(x) such transaction complies with the provisions of Section 1016 to the extent such provisions apply and (y) the remaining interest of Parent or any other Restricted Subsidiary
in such Joint Venture would have been permitted as a new Restricted Payment or Permitted Investment under the provisions of Section 1012, (iii) the issuance, transfer, conveyance, sale
or other disposition of shares of such Restricted Subsidiary so long as after giving effect to such transaction such Restricted Subsidiary remains a Restricted Subsidiary and such transaction complies
with the provisions of Section 1016 to the extent such provisions apply, (iv) the transfer, conveyance, sale or other disposition of shares required by applicable law or regulation,
(v) if required, the issuance, transfer, conveyance, sale or other disposition of directors' qualifying shares, (vi) Disqualified Stock issued in exchange for, or upon conversion of, or
the proceeds of the issuance of which are used to refinance, shares of Disqualified Stock of such Restricted Subsidiary, provided that the amounts of
the redemption obligations of such Disqualified Stock shall not exceed the amounts of the redemption obligations of, and such Disqualified Stock shall have redemption obligations no earlier than those
required by, the Disqualified Stock being exchanged, converted or refinanced, (vii) in a transaction where Parent or a Restricted Subsidiary acquires at the same time not less than its
Proportionate Interest in such issuance of Capital Stock, (viii) Capital Stock issued and outstanding on the Measurement Date, (ix) Capital Stock of a Restricted Subsidiary issued and
outstanding prior to the time that such Person becomes a Restricted Subsidiary so long as such Capital Stock was not issued in contemplation of such Person's becoming a Restricted Subsidiary or
otherwise being acquired by Parent and (x) an issuance of Preferred Stock of a Restricted Subsidiary (other than Preferred Stock convertible or exchangeable into Common Stock of any Restricted
Subsidiary) otherwise permitted by this Indenture. In the event of (a) the consummation of a transaction referred to in any of the foregoing clauses that results in a Restricted Subsidiary that
is a Guarantor no longer being a Restricted Subsidiary and (b) the execution and delivery of a supplemental indenture providing for such release in form satisfactory to the Trustee, any such
Guarantor shall be released from all its obligations under its Note Guarantee. 


        SECTION
1018. Transactions with Affiliates.


        Parent
shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, sell, lease, transfer, or otherwise dispose of any of its Property to, or purchase
any Property from, or enter into any contract, agreement, understanding, loan, advance, Guarantee or transaction (including the rendering of services) with or for the benefit of, any Affiliate (each
of the foregoing, an "Affiliate Transaction"), unless (a) such Affiliate Transaction or series of Affiliate Transactions is (i) in the best interest of Parent or such Restricted
Subsidiary and (ii) on terms that are no less favorable to Parent or such Restricted Subsidiary than those that would have been obtained in a comparable arm's-length transaction by Parent or
such Restricted Subsidiary with a Person that is not an Affiliate (or, in the event that there are no comparable transactions involving Persons who are not Affiliates of Parent or the relevant
Restricted Subsidiary to apply for comparative purposes, is otherwise on terms that, taken as a whole, Parent has determined to be fair to Parent or the relevant Restricted Subsidiary) and
(b) Parent delivers to the Trustee (i) with respect to any Affiliate Transaction or series of Affiliate Transactions involving aggregate payments in excess of $10,000,000 but less than
$15,000,000, a 


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certificate
of the chief executive, operating or financial officer of Parent evidencing such officer's determination that such Affiliate Transaction or series of Affiliate Transactions complies with
clause (a) above and (ii) with respect to any Affiliate Transaction or series of Affiliate Transactions involving aggregate payments equal to or in excess of $15,000,000, a Board
Resolution of Parent certifying that such Affiliate Transaction or series of Affiliate Transactions complies with clause (a) above and that such Affiliate Transaction or series of
Affiliate Transactions has been approved by the Board of Directors of Parent, including a majority of the disinterested members of the Board of Directors of Parent;  provided, however, that, in the event that there shall not be at least two disinterested members of the
Board of Directors of Parent with respect to the Affiliate Transaction, Parent shall, in addition to such Board Resolution, file with the Trustee a written opinion from an investment banking firm of
national standing in the United States which, in the good faith judgment of the Board of Directors of Parent, is independent with respect to Parent and its Affiliates and qualified to perform such
task, which opinion shall be to the effect that the consideration to be paid or received in connection with such Affiliate Transaction is fair, from a financial point of view, to Parent or such
Restricted Subsidiary. 


        Notwithstanding
the foregoing, the following shall not be deemed Affiliate Transactions: (i) any employment agreement entered into by Parent or any of its Restricted Subsidiaries
in the ordinary course of business and consistent with industry practice; (ii) any agreement or arrangement with respect to the compensation of a director or officer of Parent or any Restricted
Subsidiary approved by a majority of the disinterested members of the Board of Directors of Parent and consistent with industry practice; (iii) transactions between or among Parent and its
Restricted Subsidiaries; provided, however, that no more than 5% of the Voting Stock (on a fully diluted
basis) of any such Restricted Subsidiary is owned by an Affiliate of Parent (other than a Restricted Subsidiary); (iv) Restricted Payments and Permitted Investments permitted by
Section 1012 (other than Investments in Affiliates that are not Parent or Restricted Subsidiaries); (v) transactions pursuant to the terms of any agreement or arrangement as in effect on
the Measurement Date; and (vi) transactions with respect to wireline or wireless transmission capacity, the lease or sharing or other use of cable or fiber optic lines, equipment,
rights-of-way or other access rights, between Parent (or any Restricted Subsidiary) and any other Person; provided,  however, that, in the case of this
clause (vi), such transaction complies with clause (a) in the immediately preceding paragraph.
 


        SECTION
1019. Limitation on Designations of Unrestricted Subsidiaries.


        Parent
shall not designate (1) the Issuer or Level 3 LLC as an Unrestricted Subsidiary or (2) any other Subsidiary of Parent (other than a newly created Subsidiary in which
no Investment has previously been made) as an "Unrestricted Subsidiary" under this Indenture (a "Designation") unless: 



        (a)   no
Default or Event of Default shall have occurred and be continuing at the time of or after giving effect to such Designation; 



        (b)   immediately
after giving effect to such Designation, Parent would be able to Incur $1.00 of Debt under paragraph (a) of Section 1010; and 


        (c)   Parent
would not be prohibited under any provision of this Indenture from making an Investment at the time of Designation (assuming the effectiveness of such
Designation) in an amount (the "Designation Amount") equal to the portion (proportionate to Parent's equity interest in such Restricted Subsidiary) of the Fair Market Value of the net assets of such
Restricted Subsidiary on such date. 




        In
the event of any such Designation, Parent shall be deemed to have made an Investment constituting a Restricted Payment pursuant to Section 1012 for all purposes of this
Indenture in the Designation Amount; provided, however, that, upon a Revocation of any such Designation
of a Subsidiary, Parent shall be deemed to continue to have a permanent "Investment" in an Unrestricted 


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Subsidiary
of an amount (if positive) equal to (i) Parent's "Investment" in such Subsidiary at the time of such Revocation less (ii) the portion (proportionate to Parent's equity
interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time of such Revocation. At the time of any Designation of any Subsidiary as an Unrestricted
Subsidiary, such Subsidiary shall not own any Capital Stock of Parent or any Restricted Subsidiary. In addition, neither Parent nor any Restricted Subsidiary shall at any time (x) provide
credit support for, or a Guarantee of, any Debt of any Unrestricted Subsidiary (including any undertaking, agreement or instrument evidencing such Debt);  provided, however, that Parent or a Restricted Subsidiary may pledge Capital Stock or Debt of any
Unrestricted Subsidiary on a nonrecourse basis such that the pledgee has no claim whatsoever against Parent other than to obtain such pledged Capital Stock or Debt, (y) be directly or
indirectly liable for any Debt of any Unrestricted Subsidiary or (z) be directly or indirectly liable for any Debt which provides that the holder thereof may (upon notice, lapse of time or
both) declare a default thereon or cause the payment thereof to be accelerated or payable prior to its final scheduled maturity upon the occurrence of a default with respect to any Debt, Lien or other
obligation of any Unrestricted Subsidiary (including any right to take enforcement action against such Unrestricted Subsidiary), except in the case of clause (x) or (y) to the
extent permitted under Sections 1012 and 1018. 


        Unless
Designated as an Unrestricted Subsidiary, any Person that becomes a Subsidiary of Parent will be classified as a Restricted Subsidiary;  provided, however,
that such Subsidiary shall not be designated as a Restricted Subsidiary and shall be
automatically classified as an Unrestricted Subsidiary if either of the requirements set forth in clauses (a) and (b) of the immediately following paragraph will not be satisfied
immediately following such classification. Except as provided in the first sentence of this Section 1019, no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary. 



        A
Designation may be revoked (a "Revocation") by a Board Resolution of Parent delivered to the Trustee, provided that Parent will not make
any Revocation unless: 



        (a)   no
Default or Event of Default shall have occurred and be continuing at the time of and after giving effect to such Revocation; and 


        (b)   all
Liens and Debt of such Unrestricted Subsidiary outstanding immediately following such Revocation would, if Incurred at such time, have been permitted to be Incurred
at such time for all purposes of this Indenture. 




        All
Designations and Revocations must be evidenced by Board Resolutions of Parent delivered to the Trustee (i) certifying compliance with the foregoing provisions and
(ii) giving the effective date of such Designation or Revocation, such delivery to the Trustee to occur within 45 days after the end of the fiscal quarter of Parent in which such
Designation or Revocation is made (or, in the case of a Designation or Revocation made during the last fiscal quarter of Parent's fiscal year, within 90 days after the end of such fiscal year).
Upon Designation of a Restricted Subsidiary as an Unrestricted Subsidiary in compliance with this Section 1019, such Restricted Subsidiary shall, by delivery of a supplemental indenture
providing for such release in form satisfactory to the Trustee, be released from any Note Guarantee previously made by such Subsidiary. 


        SECTION
1020. Limitation on Actions with respect to Existing Intercompany Obligations. Without the consent of the holders of at least
two-thirds in principal amount of the Outstanding Securities: 



        (a)   the
Issuer shall not forgive or waive or fail to enforce any of its rights under the Offering Proceeds Note, any Offering Proceeds Note Guarantee, the
Subordination Agreement or any other agreement with Parent or any Restricted Subsidiary to subordinate a payment obligation on any Debt to the prior payment in full in cash of all obligations with
respect to the Offering Proceeds Note or an Offering Proceeds Note Guarantee, and the Issuer and Level 3 LLC may not amend the Offering Proceeds Note in a manner adverse to the holders of the
Securities; provided, however, that nothing in this covenant shall compel the Issuer to demand payment
under the 



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Offering
Proceeds Note or any Offering Proceeds Note Guarantee except during a bankruptcy, insolvency or similar proceeding; 


        (b)   in
the event Level 3 LLC (or any successor obligor under the Offering Proceeds Note) repays all or a portion of the Offering Proceeds Note, the Issuer must
(i) deposit an amount of cash equal to the principal amount of the Offering Proceeds Note then repaid in an escrow account with an unaffiliated financial institution for the benefit of
the Holders of the Securities, and as security for the prompt and complete payment and performance when due of the Issuer's obligations in respect of the Securities, until such time as the Securities
are no longer outstanding or such cash is used pursuant to clause (ii) or (iii) of this paragraph, (ii) redeem Securities having a principal amount equal to the principal
amount of the Offering Proceeds Note then repaid in accordance with, and if at such time permitted by, the Securities, or (iii) purchase Securities in the open market having a principal
amount equal to the principal amount of the Offering Proceeds Note then repaid; provided,  however, that if at any time the principal amount of the
Offering Proceeds Note is greater than the principal amount of Securities that remain
outstanding, Level 3 LLC (or any successor obligor under the Offering Proceeds Note) may repay or forgive or waive an amount of the Offering Proceeds Note equal to such excess without complying
with clause (i), (ii) or (iii) above; 


        (c)   Parent
shall not, and shall not permit any Restricted Subsidiary to, provide any Lien on its Property for the benefit of, or any Guarantee (other than a similarly
subordinated Guarantee) or other form of credit enhancement in respect of, (i) the Parent Intercompany Note or (ii) any other intercompany note required by
clause (vi) of paragraph (b) of Section 1010 or clause (iv) of paragraph (b) of Section 1011 to be subordinated to the prior
payment in full in cash of all obligations with respect to the Offering Proceeds Note or an Offering Proceeds Note Guarantee, or take any other action with the purpose or effect of
making the Parent Intercompany Note senior to or equal in right of payment with the Offering Proceeds Note; 



        (d)   Parent
and Level 3 LLC shall not amend the terms of the Parent Intercompany Note in a manner adverse to the holders of the Securities, the determination of which
shall be made by the Board of Directors of Parent acting in good faith and shall be evidenced by a Board Resolution of Parent except to permit subordination of Level 3 LLC's obligations under the
Parent Intercompany Note to its obligations under a Qualified Credit Facility as described, and to the extent set forth in the Subordination Agreement; and 


        (e)   Parent,
the Issuer and Level 3 LLC shall not amend the Subordination Agreement in a manner adverse to the holders of the Securities and Parent or any Restricted
Subsidiary and the Issuer shall not amend any other agreement between Parent or any Restricted Subsidiary and the Issuer to subordinate a payment obligation on any Debt of Parent or any Restricted
Subsidiary to the prior payment in full in cash of all obligations with respect to the Offering Proceeds Note or any Offering Proceeds Note Guarantee, in each case, the determination of which
shall be made by the Board of Directors of Parent acting in good faith and shall be evidenced by a Board Resolution of Parent except to permit subordination of their respective obligations under the
Offering Proceeds Note or any Offering Proceeds Note Guarantee to their respective obligations under a Qualified Credit Facility as described, and to the extent set forth, in the
Subordination Agreement. 




        SECTION
1021. Covenant Suspension. During any period of time (a "Suspension Period") that (i) the ratings assigned to the
Securities by both of the Rating Agencies are Investment Grade Ratings and (ii) no Default or Event of Default has occurred and is continuing, Parent and the Restricted Subsidiaries will not be
subject to the covenants set forth in Sections 1010, 1011, 1012, 1013, 1015(i)(a), 1016, 1017 (other than the first two sentences thereof), 1018, 801(3) and (4), 803(3) and
(4) and clause (b) of the first sentence of Section 1019 (collectively, the "Suspended Covenants"). In the event 


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that
Parent and the Restricted Subsidiaries are not subject to the Suspended Covenants for any period of time as a result of the preceding sentence and, on any subsequent date (the "Reversion Date"),
one or both of the Rating Agencies withdraws its ratings or downgrades the ratings assigned to the Securities below the required Investment Grade Ratings or a Default or Event of Default occurs and is
continuing, then Parent and the Restricted Subsidiaries will thereafter again be subject to the Suspended Covenants and calculations of the amount available to be made as Restricted Payments under
Section 1012 will be made as though Section 1012 had been in effect during the entire period of time from the Measurement Date. On the Reversion Date, all Debt Incurred during the
Suspension Period will be classified to have been Incurred pursuant to paragraph (a) of Section 1010 or one of the clauses set forth in paragraph (b) of
Section 1010 or paragraph (a) of Section 1011 or one of the clauses set forth in paragraph (b) of Section 1011 (in each case to the extent such Debt
would be permitted to be Incurred thereunder as of the Reversion Date and after giving effect to Debt Incurred prior to the Suspension Period and outstanding on the Reversion Date). To the extent such
Debt would not be permitted to be Incurred pursuant to paragraph (a) of Section 1010 or one of the clauses set forth in paragraph (b) of Section 1010 or
paragraph (a) of Section 1011 or one of the clauses set forth in paragraph (b) of Section 1011, such Debt will be deemed to have been outstanding on the
Measurement Date, so that it is classified as permitted under Section 1010(b)(v) or Section 1011(b)(iii). If the Incurrence of any Debt by a Restricted Subsidiary during the
Suspension Period would have been prohibited or conditioned upon such Restricted Subsidiary entering into a Note Guarantee and an Offering Proceeds Note Guarantee had Section 1010
and Section 1011 been in effect at the time of such Incurrence, such Restricted Subsidiary shall enter into a Note Guarantee and an Offering Proceeds Note Guarantee that are senior to or  pari passu with such Debt within ten days after the Reversion Date. For purposes of determining compliance with Section 1016 on the
Reversion Date, the Net Available Proceeds from all Asset Sales not applied in accordance with the covenant will be deemed to be reset to zero. Notwithstanding the foregoing, neither (a) the
continued existence, after the date of such withdrawal or downgrade, of facts and circumstances or obligations that were Incurred or otherwise came into existence during a Suspension Period nor
(b) the performance of any such obligations, shall constitute a breach of any covenant set forth in the Indenture or cause a Default or Event of Default thereunder;  provided, however, that (1) Parent and its Restricted Subsidiaries did not Incur or otherwise
cause such facts and circumstances or obligations to exist in anticipation of a withdrawal or downgrade below investment grade, (2) Parent reasonably believed that such Incurrence or actions
would not result in such a withdrawal or downgrade and (3) if so required each Restricted Subsidiary shall have entered into a Note Guarantee and an Offering Proceeds
Note Guarantee within the specified time period. For purposes of clauses (1) and (2) in the preceding sentence, anticipation and reasonable belief may be determined by Parent and
shall be conclusively evidenced by a board resolution to such effect adopted in good faith by the Board of Directors of Parent. In reaching their determination, the Board of Directors of Parent may,
but need not, consult with the Rating Agencies. 


        SECTION
1022. Special Interest Notice.


        In
the event that the Issuer is required to pay Special Interest to Holders pursuant to the Registration Agreement, the Issuer will provide written notice ("Special Interest Notice") to
the Trustee of its obligation to pay Special Interest no later than fifteen days prior to the proposed payment date for the Special Interest, and the Special Interest Notice shall set forth the
amount of Special Interest to be paid by the Issuer on such payment date. The Trustee shall not at any time be under any duty or responsibility to any Holders to determine the Special Interest, or
with respect to the nature, extent, or calculation of the amount of Special Interest owed, or with respect to the method employed in such calculation of the Special Interest. 


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ARTICLE ELEVEN  


 REDEMPTION OF SECURITIES  


        SECTION 1101. Right of Redemption.


        The
Securities will be subject to redemption at the option of the Issuer, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days' prior
notice, on the terms and at the redemption prices (expressed as percentages of principal amount) set forth in paragraph 5 on the reverse of the form of Security, plus accrued and unpaid
interest thereon (if any) to the Redemption Date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date). 


        SECTION
1102. Applicability of Article.


        This
Article shall govern any redemption of the Securities pursuant to Section 1101. 


        SECTION
1103. Election to Redeem; Notice to Trustee.


        The
election of the Issuer to redeem any Securities pursuant to Section 1101 shall be evidenced by a Board Resolution of the Issuer. The Issuer shall, at least 60 days
prior to the Redemption Date fixed by the Issuer (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the principal amount of Securities to
be redeemed and shall deliver to the
Trustee such documentation and records as shall enable the Trustee to select the Securities to be redeemed pursuant to Section 1104. Such notice shall be accompanied by an Officers' Certificate
and an Opinion of Counsel from the Issuer to the effect that such redemption will comply with the conditions herein. 


        SECTION
1104. Selection by Trustee of Securities to Be Redeemed.



        If
less than all the Securities 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 not previously called for redemption, in compliance with the requirements of the principal national securities exchange, if any, on which the Securities are listed, or,
if the Securities are not so listed, on a pro rata basis, by lot or by such other method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of
portions of the principal of Securities; provided, however, that no such partial redemption shall reduce
the portion of the principal amount of a Security not redeemed to less than $1,000. 



        The
Trustee shall promptly notify the Issuer 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 redemption of Securities shall relate, in the case of any Security redeemed or to be
redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed. 


        SECTION
1105. Notice of Redemption.


        Notice
of redemption shall be given in the manner provided for in Section 106 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of
Securities to be redeemed. 


        Each
notice of redemption shall identify the Securities (including "CUSIP" number(s)) to be redeemed and shall state: 


        (1)   the
Redemption Date, 


        (2)   the
Redemption Price and the amount of accrued interest to the Redemption Date payable as provided in Section 1107, if any, 


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


        (4)   in
case any Security is to be redeemed in part only, that on and after the Redemption Date, upon surrender of such Security, the Holder will receive, without charge, a
new Security or Securities of authorized denominations for the principal amount thereof remaining unredeemed, 


        (5)   that
on the Redemption Date the Redemption Price (and unpaid and accrued interest, if any, to the Redemption Date payable as provided in Section 1107) will become
due and payable upon each such Security, or the portion thereof, to be redeemed, and that, unless the Issuer defaults in making such redemption payment or the Trustee or the Paying Agent is prohibited
from making such payment, interest thereon will cease to accrue on and after said date, and 


        (6)   the
place or places where such Securities are to be presented and surrendered for payment of the Redemption Price and accrued interest, if any. 


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


        SECTION
1106. Deposit of Redemption Price.


        On
or prior to any Redemption Date (and if on any Redemption Date, before 11:00 A.M. New York City time, on such date), the Issuer shall deposit with the Trustee or with a Paying
Agent (or, if the Issuer is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money sufficient to pay the Redemption Price of, and unpaid and
accrued interest (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date) on, all the Securities which are to be redeemed
on that date. 


        SECTION
1107. 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 unpaid and accrued interest, if any, to the Redemption Date), and from and after such date (unless the Issuer shall default in the payment of the Redemption Price and accrued interest
or the Trustee or the Paying Agent shall be prohibited from making such payment) 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 Issuer at the Redemption Price, together with unpaid and accrued interest, if any, to the Redemption Date;  provided, however, that installments of interest whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms. 


        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 borne by the Securities. 


        SECTION
1108. Securities Redeemed in Part.


        Any
Security which is to be redeemed only in part shall be surrendered at the office or agency of the Issuer maintained for such purpose pursuant to Section 1002 (with, if the
Issuer and the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Issuer and the Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Issuer shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities,
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. 


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ARTICLE TWELVE  


 DEFEASANCE AND COVENANT DEFEASANCE  


        SECTION 1201. Issuer's Option to Effect Defeasance or Covenant Defeasance.


        The
Issuer may, at its option by Board Resolution of the Issuer, at any time, with respect to the Securities, elect to have either Section 1202 or Section 1203 be applied
to all Outstanding Securities upon compliance with the conditions set forth below in this Article Twelve. 


        SECTION
1202. Defeasance and Discharge.


        Upon
the Issuer's exercise under Section 1201 of the option applicable to this Section 1202, the Issuer and the Guarantors shall be deemed to have been discharged from
their obligations with respect to all Outstanding Securities on the date the conditions set forth in Section 1204 are satisfied (hereinafter, "defeasance"). For this purpose, such defeasance
means that the Issuer shall be deemed to have paid and discharged the entire indebtedness represented by the Outstanding Securities, which shall thereafter be deemed to be "Outstanding" only for the
purposes of Section 1205 and the other Sections of this Indenture referred to in clauses (A) and (B) below, and to have satisfied all their other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and the Trustee, at the expense of the Issuer, shall execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged hereunder: (A) the Issuer's obligations with respect to such Securities under Section 2.3 of Appendix A and
Sections 303, 306, 307, 1002 and 1003 and the Issuer's rights under Section 1101, (B) rights of Holders to receive payment of principal of, premium, if any, and interest on such
Securities (but not the Purchase Price referred to under Section 1009 or 1016) and any rights of the Holders with respect to such amounts, (C) the rights, obligations and immunities of
the Trustee under the Indenture and (D) this Article Twelve. Subject to compliance with this Article Twelve, the Issuer may exercise its option under this Section 1202
notwithstanding the prior exercise of its option under Section 1203 with respect to the Securities. If the Issuer exercises its option under this Section 1202, (u) each Guarantor,
if any, shall be released from all its obligations under its Note Guarantee, (v) all subordination provisions contained in the Parent Intercompany Note and the Subordination
Agreement shall be deemed terminated as they relate to the Offering Proceeds Note and the Offering Proceeds Note Guarantees, (w) the Offering Proceeds Note may be prepaid
in whole or in part, (x) no entity shall be obligated to guarantee the Offering Proceeds Note, (y) the Offering Proceeds Note may be canceled and (z) all obligations to
provide Offering Proceeds Note Guarantees shall terminate and all references in the Indenture to Offering Proceeds Note Guarantees and Offering Proceeds Note Guarantees shall be
disregarded and not be deemed to be requirements to take or omit to take any action by Parent or any Restricted Subsidiary. 


        SECTION
1203. Covenant Defeasance.


        Upon
the Issuer's exercise under Section 1201 of the option applicable to this Section 1203, the Issuer and each Guarantor shall be released from their obligations under
any covenant contained in Sections 801(3), (4) and (5), 803(3), (4) and (5) in Sections 804, 806, 1005, 1006 and 1007 and Sections 1009 through 1021 and from the
operation of Sections 501(6), (7), (8), (9) and (10) (but, in the case of Sections 501(9) and (10), with respect only to Significant Subsidiaries), with respect to
the Outstanding Securities on and after the date the conditions set forth below are satisfied (hereinafter, "covenant defeasance"), and the Securities shall thereafter be deemed not to be
"Outstanding" for the purposes of any direction, waiver, consent, declaration or other Act of Holders (and the consequences of any thereof) in connection with such provisions, but shall continue to be
deemed "Outstanding" for all other purposes hereunder. For this purpose, such covenant defeasance means that, with respect to the Outstanding Securities, the Issuer and the Guarantors may omit to
comply with and shall have no liability in respect of any term, condition or limitation set forth in any such provision, whether directly 


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or
indirectly, by reason of any reference elsewhere herein to any such provision or by reason of any reference in any such provision to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under Section 501(3), (4), (5), (6), (7), (8), (9) or (10) (but, in the case of
Section 501(9) or (10), with respect only to Significant Subsidiaries) but, except as specified above, the remainder of this Indenture and such Securities shall be unaffected thereby. If
the Issuer exercises its option under this Section 1203, (u) each Guarantor shall be released from all its obligations under its Note Guarantee, (v) all subordination
provisions contained in the Parent Intercompany Note and the Subordination Agreement shall be deemed terminated as they relate to the Offering Proceeds Note and the Offering Proceeds
Note Guarantees, (w) the Offering Proceeds Note may be prepaid in whole or in part, (x) no entity shall be obligated to guarantee the Offering Proceeds Note, (y) the
Offering Proceeds Note may be canceled and (z) all obligations to provide Offering Proceeds Note Guarantees shall terminate and all references in the Indenture to Offering
Proceeds Note Guarantees and Offering Proceeds Note Guarantees shall be disregarded and not be deemed to be requirements to take or omit to take any action by Parent or any Restricted
Subsidiary. 


        SECTION
1204. Conditions to Defeasance or Covenant Defeasance.


        The
following shall be the conditions to application of either Section 1202 or Section 1203 to the Outstanding Securities: 


        (1)   The
Issuer shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee satisfying the requirements of Section 608 who shall
agree to comply with the provisions of this Article Twelve applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, at any time prior to the Maturity of the Securities: (A) money in an amount, or (B) Government Securities which
through the payment of interest and principal will provide, not later than one day before the due date of payment in respect of the Securities, money in an amount, or (C) a combination thereof,
sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge the principal
of (and premium, if any, on) and interest on, the Outstanding Securities on the Stated Maturity (or Redemption Date, if applicable) of such principal (and premium, if any) or installment of interest;  provided that the Trustee (or such other trustee) shall have been irrevocably instructed in writing to apply such money or the proceeds of such
Government Securities to said payments with respect to the Securities. Before such a deposit, the Issuer may give to the Trustee, in accordance with Section 1103, a notice of their election to
redeem all of the Outstanding Securities at a future date in accordance with Article Eleven, which notice shall be irrevocable. Such irrevocable redemption notice, if given, shall be given
effect in applying the foregoing. 


        (2)   No
Default or Event of Default with respect to the Securities shall have occurred and be continuing on the date of such deposit or, insofar as paragraphs (9) and
(10) of Section 501 are concerned with respect to the Parent and the Issuer, at any time during the period ending on the 123rd day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until the expiration of such period). 


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


        (4)   In
the case of an election under Section 1202, the Issuer shall have delivered to the Trustee an Opinion of Counsel stating that (x) the Issuer has
received from, or there has been published by, the Internal Revenue Service a ruling, or (y) since the date of this Indenture, there has been a change in the applicable federal income tax law,
in either case to the effect that, and based thereon such opinion shall confirm that, the Holders of the Outstanding Securities will not recognize income, gain or loss for federal income tax purposes
as a result of such defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance had not occurred. 


73







   
        (5)   In the case of an election under Section 1203, the Issuer shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the
Outstanding Securities will not recognize income, gain or loss for federal income tax purposes as a result of such covenant defeasance and will be subject to federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such covenant defeasance had not occurred. 



        (6)   The
Issuer shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to
either the defeasance under Section 1202 or the covenant defeasance under Section 1203 (as the case may be) have been complied with. 


        (7)   The
Issuer shall have delivered to the Trustee an Opinion of Counsel acceptable to the Trustee to the effect that such defeasance will not result in the trust relating
thereto or the Trustee being subject to regulation under the Investment Company Act of 1940. 


        SECTION
1205. Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions.


        Subject
to the provisions of the last paragraph of Section 1003, all money and Government Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 1205, the "Trustee") pursuant to Section 1204 in respect of the Outstanding Securities shall be held in trust and applied by
the Trustee, in accordance with the provisions of such Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Issuer acting as its own Paying Agent)
as the Trustee may determine, to the Holders of such Securities of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated
from other funds except to the extent required by law or to the extent the Issuer or Parent acts as the Issuer's Paying Agent. 


        The
Issuer shall pay and indemnify the Trustee and (if applicable) its officers, directors, employees and agents against any tax, fee or other charge imposed on or assessed against the
Government Securities deposited pursuant to Section 1204 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account
of the Holders of the Outstanding Securities. 


        Anything
in this Article Twelve to the contrary notwithstanding, the Trustee shall deliver or pay to the Issuer from time to time upon Issuer Request any money or Government
Securities held by it as provided in Section 1204 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered
to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect an equivalent defeasance or covenant defeasance, as applicable, in accordance with this
Article Twelve. 


        SECTION
1206. Reinstatement.


        If
the Trustee or any Paying Agent is unable to apply any money in accordance with Section 401 or 1205 by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the Issuer's and each Guarantor's obligations under this Indenture and the Securities shall be revived and reinstated as though
no deposit had occurred pursuant to Section 401, 1202 or 1203, as the case may be, until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance therewith;  provided, however, that if the Issuer or any Guarantor makes any payment of principal of, premium, if
any, or interest on any Security following the reinstatement of its obligations, the Issuer or such Guarantor shall be subrogated to the rights of the Holders of such Securities to receive such
payment from the money held by the Trustee or Paying Agent. 


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ARTICLE THIRTEEN  


 GUARANTEES AND OFFERING PROCEEDS NOTE GUARANTEES  


        SECTION 1301. Guarantees. Each Guarantor hereby unconditionally guarantees, jointly and severally, to each Holder
and to the Trustee and its successors and assigns (a) the full and punctual payment of principal of (and premium, if any) and interest on the Securities when due, whether at Stated Maturity, by
acceleration, by redemption or otherwise, and all other monetary obligations of the Issuer under this Indenture and the Securities and (b) the full and punctual performance within applicable
grace periods of all other obligations of the Issuer under this Indenture and the Securities (all the foregoing being hereinafter collectively called the "Obligations"). Each Guarantor further agrees
that the Obligations may be extended or renewed, in whole or in part, without notice or further assent from such Guarantor, and that such Guarantor will remain bound under this Article Thirteen
notwithstanding any extension or renewal of any Obligation. 


        Each
Guarantor waives presentation to, demand of, payment from and protest to the Issuer of any of the Obligations and also waives notice of protest for nonpayment. Each Guarantor waives
notice of any
default under the Securities or the Obligations. The obligations of each Guarantor hereunder shall not be affected by (a) the failure of any Holder or the Trustee to assert any claim or demand
or to enforce any right or remedy against the Issuer or any other Person under this Indenture, the Securities or any other agreement or otherwise; (b) any extension or renewal of any thereof;
(c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Securities or any other agreement; (d) the release of any security held by
any Holder or the Trustee for the Obligations or any of them; (e) the failure of any Holder or the Trustee to exercise any right or remedy against any other guarantor of the Obligations; or
(f) any change in the ownership of such Guarantor. 


        Each
Guarantor further agrees that its Note Guarantee herein constitutes a guarantee of payment, performance and compliance when due (and not a guarantee of collection) and waives
any right to require that any resort be had by any Holder or the Trustee to any security held for payment of the Obligations. 


        Except
as expressly set forth in Sections 805, 806, 1017, 1019, 1202, 1203, 1303 and 1308, the obligations of each Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim,
recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor herein shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under
this Indenture, the Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or
by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of such Guarantor or would otherwise operate as a discharge
of such Guarantor as a matter of law or equity. 


        Each
Guarantor further agrees that its Note Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of
principal of (or premium, if any) or interest on any Obligation is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Issuer or
otherwise. 


        In
furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against any Guarantor by virtue hereof, upon the failure
of the Issuer to pay the principal of (or premium, if any) or interest on any Obligation when and as the same shall become due, whether at Stated Maturity, by acceleration, by redemption or otherwise,
or to perform or comply with any other Obligation, each Guarantor hereby promises to and will, upon receipt of written 


75





 



demand
by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i) the unpaid amount of such Obligations, (ii) accrued
and unpaid interest on such Obligations (but only to the extent not prohibited by law) and (iii) all other monetary Obligations of the Issuer to the Holders and the Trustee. 



        Each
Guarantor agrees that it shall not be entitled to any right of subrogation in respect of any Obligations guaranteed hereby until payment in full in cash of all Obligations. Each
Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the Obligations guaranteed hereby may be accelerated as
provided in Article Five for the purposes of such Guarantor's Note Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of
the Obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such Obligations as provided in Article Five, such Obligations (whether or not due and
payable) shall forthwith become due and payable by such Guarantor for the purposes of this Section. 



        Each
Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys' fees) incurred by the Trustee or any Holder in enforcing any rights under this
Section 1301. 


        SECTION
1302. Contribution. Each of the Issuer and any Guarantor (a "Contributing Party") agrees that, in the event a payment shall be
made by any other Guarantor under any Note Guarantee (the "Claiming Guarantor"), the Contributing Party shall indemnify the Claiming Guarantor in an amount equal to the amount of such payment
multiplied by a fraction, the numerator of which shall be the net worth of the Contributing Party on the date hereof and the denominator of which shall be the aggregate net worth of the Issuer and all
the Guarantors on the date hereof (or, in the case of any Guarantor becoming a party hereto pursuant to Section 901, the date of the supplemental indenture executed and delivered by such
Guarantor). 


        SECTION
1303. Release of Guarantees. The Note Guarantee of a Guarantor (other than Parent) will be released (a) in
connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by way of merger or consolidation) to a Person that is not (either before or after
giving effect to such transaction) Parent or a Restricted Subsidiary, if the sale or other disposition of all or substantially all of the assets of that Guarantor complies with Section 1016 (or
Parent certifies in an Officers' Certificate to the Trustee that it will comply with the requirements of Section 1016 relating to application of the proceeds of such sale or disposition),
(b) in connection with any sale of all
of the Capital Stock of a Guarantor (other than Parent) to a Person that is not (either before or after giving effect to such transaction) Parent or a Restricted Subsidiary, if the sale of all such
Capital Stock of that Guarantor complies with Section 1016 (or Parent certifies in an Officers' Certificate to the Trustee that it will comply with the requirements of Section 1016
relating to application of the proceeds of such sale or disposition), or (c) if Parent properly designates any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary pursuant
to Section 1019. 


        SECTION
1304. Successors and Assigns. This Article Thirteen shall be binding upon each Guarantor and its successors and assigns and
shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and
privileges conferred upon that party in this Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this
Indenture. 


        SECTION
1305. No Waiver. Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or
privilege under this Article Thirteen shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.
The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this
Article Thirteen at law, in equity, by statute or otherwise. 


76





 



        SECTION
1306. Modification. No modification, amendment or waiver of any provision of this Article Thirteen, nor the consent to any
departure by any Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice to or demand on any Guarantor in any case shall entitle such Guarantor to any other or further notice or demand in the same, similar or
other circumstances. 


        SECTION
1307. Execution of Supplemental Indenture for Future Guarantors. Each Subsidiary which is required to become a Guarantor pursuant
to any Section of the Indenture shall promptly execute and deliver to the Trustee a supplemental indenture in the form of Exhibit C hereto pursuant to which such Subsidiary shall become
a Guarantor under this Article Thirteen and shall guarantee the Obligations. Concurrently with the execution and delivery of such supplemental indenture, the Issuer shall deliver to the Trustee
an Opinion of Counsel to the effect that such supplemental indenture has been duly authorized, executed and delivered by such Subsidiary and that, subject to the application of bankruptcy, insolvency,
moratorium, fraudulent conveyance or transfer and other similar laws relating to creditors' rights generally and to the principles of equity, whether considered in a proceeding at law or in equity,
the Note Guarantee of such Guarantor is a legal, valid and binding obligation of such Guarantor, enforceable against such Guarantor in accordance with its terms. Each Person then a Guarantor
authorizes the Issuer to enter into such a supplemental indenture on its behalf. 



        SECTION
1308. Subordination of Note Guarantees. The Issuer, the Guarantors and the Trustee may, without notice to or consent of any
holder of Securities, enter into one or more indentures supplemental to the Indenture, or amend any indenture supplemental to the Indenture entered into by the Issuer, such Guarantor and the Trustee
for the purpose of adding an additional Note Guarantee pursuant to Section 1010 or Section 1011 to provide that the payment obligation on a Note Guarantee of a Guarantor (other
than Parent or any Sister Restricted Subsidiary) be expressly subordinated in any bankruptcy, liquidation or winding up proceeding of such Guarantor to the prior payment in full in cash of all
obligations of such Guarantor under any Guarantee of, or obligation as borrower under, any Qualified Credit Facility Incurred by Parent or a Restricted Subsidiary in accordance with
clause (ii) of paragraph (b) of Section 1010 or clause (ii) of paragraph (b) of Section 1011;  provided, however, that (x) the terms of the subordination of a Note Guarantee to any such
Guarantee of, or obligation as borrower under, a Qualified Credit Facility may not eliminate or otherwise adversely affect the subordination of the payment obligation on any other Debt of such
Guarantor to the payment obligation of the Note Guarantee of such Guarantor and (y) any Guarantee (other than a Guarantee of such Qualified Credit Facility) by such Guarantor of any
other Debt of Parent or any Sister Restricted Subsidiary also shall be expressly subordinated in any bankruptcy, liquidation or winding up proceeding of such Guarantor to the prior payment in full in
cash of all obligations of such Guarantor under its Guarantee of such Qualified Credit Facility to at least the same extent and on the same terms and conditions as the subordination provisions
applicable to such Guarantor's Note Guarantee. 


        SECTION
1309. Execution of Offering Proceeds Note Guarantees for Future Offering Proceeds Note Guarantors; Subordination of Offering Proceeds
Note Guarantee. (a) Each Subsidiary which is required to become an Offering Proceeds Note Guarantor pursuant to any Section of the Indenture shall
promptly execute, and deliver a copy to the Trustee of, an Offering Proceeds Note Guarantee substantially in the form set forth in Exhibit E hereto pursuant to which such Subsidiary
shall become an Offering Proceeds Note Guarantor. Concurrently with the execution and delivery of such Offering Proceeds Note Guarantee, the Issuer shall deliver to the Trustee an Opinion of
Counsel to the effect that such Offering Proceeds Note Guarantee has been duly authorized, executed and delivered by such Subsidiary and that, subject to the application of bankruptcy,
insolvency, moratorium, fraudulent conveyance or transfer and other similar laws relating to creditors' rights generally and to the principles of equity, whether considered in a proceeding at law or
in equity, the Offering Proceeds Note Guarantee of such Offering Proceeds Note Guarantor is a legal, valid and binding obligation of 


77





 



such
Offering Proceeds Note Guarantor, enforceable against such Offering Proceeds Note Guarantor in accordance with its terms. Any Offering Proceeds Note Guarantee of an Offering
Proceeds Note Guarantor will be released on the terms, and as set forth in, the form of Offering Proceeds Note Guarantee attached as Exhibit E hereto. 


        (b)   Each
Offering Proceeds Note Guarantor required expressly to subordinate the payment obligation of certain intercompany Debt to obligations with respect to the
Offering Proceeds Note Guarantee of such Offering Proceeds Note Guarantor pursuant to, and on terms set forth in, clause (vi) of paragraph (b) of
Section 1010 or clause (iv) of paragraph (b) of Section 1011, shall promptly execute, and deliver a copy to the Trustee of, a supplement to the Subordination
Agreement in substantially the form attached as Exhibit D hereto. 


78





 

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



	

 	
 	

LEVEL 3 FINANCING, INC., as Issuer
	

 	
 	

By:	
 	

/s/  NEIL J. ECKSTEIN      
 Name: Neil J. Eckstein

Title: Senior Vice President
	

 	
 	

LEVEL 3 COMMUNICATIONS, INC., as Parent and a Guarantor
	

 	
 	

By:	
 	

/s/  THOMAS C. STORTZ      
 Name: Thomas C. Stortz

Title: Group Vice President
	

 	
 	

THE BANK OF NEW YORK, as Trustee
	

 	
 	

By:	
 	

/s/  VAN K. BROWN      
 Name: Van K. Brown

Title: Vice President




79






   APPENDIX A  


        FOR OFFERINGS TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT TO RULE 144A AND TO CERTAIN PERSONS IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S. 


PROVISIONS RELATING TO INITIAL SECURITIES

AND EXCHANGE SECURITIES  


        1.  Definitions


        1.1
Definitions


        For
the purposes of this Appendix A the following terms shall have the meanings indicated below: 


        "Additional
Securities" means, subject to the Issuer's compliance with the covenants in this Indenture, including Section 1010 and Section 1011, 10.750% Senior Notes due
2011 issued from time to time after the Issue Date under the terms of the Indenture (other than pursuant to Section 306, 307, 1016 or 1108 of the Indenture and other than Exchange Securities or
Private Exchange Securities issued pursuant to an exchange offer for other Securities outstanding under the Indenture). 


        "Definitive
Security" means a certificated Initial Security or Exchange Security or Private Exchange Security bearing, if required, the restricted securities legend set forth in
Section 2.3(c). 


        "Depository"
means The Depository Trust Company, its nominees and their respective successors. 



        "Distribution
Compliance Period", with respect to any Securities, means the period of 40 consecutive days beginning on and including the later of (i) the day on which such
Securities are first offered to persons other than distributors (as defined in Regulation S under the Securities Act) in reliance on Regulation S and (ii) the Issue Date with
respect to such Securities. 


        "Exchange
Securities" has the meaning stated in the first recital of the Indenture. 


        "Euroclear"
means the Euroclear Clearance System or any successor securities clearing agency. 



        "Initial
Purchasers" means Citigroup Global Markets Inc., Credit Suisse First Boston LLC, J.P. Morgan Securities Inc., Morgan Stanley & Co. Incorporated and UBS
Warburg LLC. 


        "Initial
Securities" has the meaning stated in the first recital of the Indenture. 


        "Original
Securities" means Initial Securities in the aggregate principal amount of $500,000,000 issued on October 1, 2003. 


        "Private
Exchange" means the offer by the Issuer, pursuant to Section 2(f) of the Registration Agreement dated October 1, 2003, or pursuant to any similar provision of any
other Registration Agreement, to issue and deliver to certain purchasers, in exchange for the Initial Securities held by such purchasers as part of their initial distribution, a like aggregate
principal amount of Private Exchange Securities. 


        "Private
Exchange Securities" means the Exchange Securities to be issued pursuant to this Indenture in connection with a Private Exchange Offer pursuant to the relevant Registration
Agreement. 


        "Purchase
Agreement" means the Purchase Agreement dated September 26, 2003, among Parent, the Issuer and the Initial Purchasers relating to the Original Securities, or any similar
agreement relating to any future sale of Initial Securities by the Issuer. 


        "QIB"
means a "qualified institutional buyer" as defined in Rule 144A. 


A-1





 



        "Registered
Exchange Offer" means the offer by the Issuer, pursuant to the relevant Registration Agreement, to certain Holders of Initial Securities, to issue and deliver to such
Holders, in exchange for the Initial Securities, a like aggregate principal amount of Exchange Securities registered under the Securities Act. 



        "Registration
Agreement" means the Registration Agreement dated October 1, 2003, among Parent, the Issuer and the Initial Purchasers relating to the Original Securities, or any
similar agreement relating to any registration of Additional Securities. 


        "Rule 144A
Securities" means all Initial Securities offered and sold to QIBs in reliance on Rule 144A. 


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



        "Securities
Act" means the Securities Act of 1933, as amended (or any successor act), and the rules and regulations thereunder (or respective successors thereto). 


        "Securities
Custodian" means the custodian with respect to a Global Security (as appointed by the Depository) or any successor person thereto, who shall initially be the Trustee. 


        "Shelf
Registration Statement" means a registration statement issued by Parent and the Issuer in connection with the offer and sale of Initial Securities or Private Exchange Securities
pursuant to the relevant Registration Agreement. 


        "Transfer
Restricted Securities" means Definitive Securities and any other Securities that bear or are required to bear the legend set forth in Section 2.3(c) hereto. 


        1.2
Other Definitions



	Term
 
	 	Defined in Section:

	"Agent Members"	 	2.1(b)
	"Global Security"	 	2.1(a)
	"Regulation S"	 	2.1
	"Rule 144A"	 	2.1
	"Rule 144A Global Security"	 	2.1(a)






        2.
The Securities


        2.1
Form and Dating


        The
Initial Securities will be offered and sold by the Issuer, from time to time, pursuant to one or more Purchase Agreements. The Initial Securities will be resold initially only to
QIBs in reliance on Rule 144A under the Securities Act ("Rule 144A") and in reliance on Regulation S under the Securities Act ("Regulation S"). Initial Securities may thereafter
be transferred to, among others, QIBs and purchasers in reliance on Regulation S. 



        (a)   Global Securities. Initial Securities initially resold pursuant to Rule 144A shall be issued initially in the form
of one or more permanent global Securities in definitive, fully registered form (collectively, the "Rule 144A Global Security") and Initial Securities initially resold pursuant to
Regulation S shall be issued initially in the form of one or more global securities (collectively, the "Regulation S Global Security"), in each case without interest coupons and with the
global securities legend and restricted securities legend set forth in Exhibit 1 hereto, which shall be deposited on behalf of the purchasers of the Initial Securities represented thereby with
the Securities Custodian, and registered in the name of the Depository or a nominee of the Depository, duly executed by the Issuer and authenticated by the Trustee as provided in this Indenture. The
Rule 144A Global Security and Regulation S Global Security are collectively referred to herein as "Global Securities." The aggregate 


A-2





 



principal
amount of the Global Securities may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depository or its nominee as hereinafter provided. 



        (b)   Book-Entry Provisions. This Section 2.1(b) shall apply only to a Global Security deposited with
or on behalf of the Depository. 


        The
Issuer shall execute and the Trustee shall, in accordance with this Section 2.1(b) and pursuant to an order of the Issuer, authenticate and deliver initially one or more
Global Securities that (a) shall be registered in the name of the Depository for such Global Security or Global Securities or the nominee of such Depository and (b) shall be delivered by
the Trustee to such Depository or pursuant to such Depository's instructions or held by the Trustee as Securities Custodian. 



        Members
of, or participants in, the Depository ("Agent Members") shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depository or
by the Trustee as Securities Custodian or under such Global Security, and the Depository may be treated by the Issuer, the Trustee and any agent of the Issuer or the Trustee as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuer, the Trustee or any agent of the Issuer or the Trustee from giving effect to
any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and its Agent Members, the operation of customary practices of such Depository
governing the exercise of the rights of a holder of a beneficial interest in any Global Security. 



        (c)   Definitive Securities. Except as provided in Section 2.3 or 2.4, owners of beneficial interests in Global
Securities will not be entitled to receive physical delivery of Definitive Securities. 


        2.2   Authentication. The Trustee shall authenticate and deliver: (1) Original Securities, (2) any Additional
Securities, and (3) the Exchange Securities or Private Exchange Securities for issue only in a Registered Exchange Offer or a Private Exchange, respectively, pursuant to the relevant
Registration Agreement, for a like principal amount of Initial Securities or Private Exchange Securities, as applicable, upon a written order of the Issuer signed by two Officers or by an Officer and
either an Assistant Treasurer or an Assistant Secretary of the Issuer. Such order shall specify the amount of the Securities to be authenticated and the date on which the original issue of Securities
is to be authenticated and whether the Securities are to be Initial Securities or Exchange Securities. 


        2.3   Transfer and Exchange. (a) Transfer and Exchange of Definitive
Securities. When Definitive Securities are presented to the Security Registrar or a co-registrar with a request: 



        (x)   to
register the transfer of such Definitive Securities; or 


        (y)   to
exchange such Definitive Securities for an equal principal amount of Definitive Securities of other authorized denominations, 




the
Security Registrar or co-registrar shall register the transfer or make the exchange as requested if its reasonable requirements for such transaction are met; provided, however, that
the Definitive Securities surrendered for transfer or exchange: 



        (i)    shall
be duly endorsed or accompanied by a written instrument of transfer in form reasonably satisfactory to the Issuer and the Security Registrar or
co-registrar, duly executed by the Holder thereof or his attorney duly authorized in writing; and 


        (ii)   if
such Definitive Securities bear a restricted securities legend, they are being transferred or exchanged pursuant to an effective registration statement under the
Securities Act or pursuant 



A-3





 




to
clause (A), (B) or (C) below, and are accompanied by the following additional information and documents, as applicable: 



        (A)  if
such Definitive Securities are being delivered to the Security Registrar by a Holder for registration in the name of such Holder, without transfer, a certification
from such Holder to that effect; or 


        (B)  if
such Definitive Securities are being transferred to the Issuer, a certification to that effect; or 


        (C)  if
such Definitive Securities are being transferred pursuant to an exemption from registration in accordance with Rule 144 under the Securities Act, (i) a
certification to that effect and (ii) if the Issuer so requests, an opinion of counsel or other evidence reasonably satisfactory to it as to the compliance with the restrictions set forth in
the legend set forth in Section 2.3(d)(i). 





        (b)   Transfer and Exchange of Global Securities. (i) The transfer and exchange of Global Securities or beneficial
interests therein shall be effected through the Depository, in accordance with this Indenture (including applicable restrictions on transfer set forth herein, if any) and the procedures of the
Depository therefor. A transferor of a beneficial interest in a Global Security shall deliver a written order given in accordance with the Depository's procedures containing information regarding the
participant account of the Depository to be credited with a beneficial interest in the Global Security and such account shall be credited in accordance with such instructions with a beneficial
interest in the Global Security and the account of the Person making the transfer shall be debited by an amount equal to the beneficial interest in the Global Security being transferred. 



        (ii)   If
the proposed transfer is a transfer of a beneficial interest in one Global Security to a beneficial interest in another Global Security, the Security Registrar shall
reflect on its books and records the date and an increase in the principal amount of the Global Security to which such interest is being transferred in an amount equal to the principal amount of the
interest to be so transferred, and the Security Registrar shall reflect on its books and records the date and a corresponding decrease in the principal amount of the Global Security from which such
interest is being transferred. 


        (iii)  Notwithstanding
any other provisions of this Appendix A (other than the provisions set forth in Section 2.4), a Global Security may not be transferred as
a whole except by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository. 


        (iv)  In
the event that a Global Security is exchanged for Definitive Securities pursuant to Section 2.4 prior to the consummation of a Registered Exchange Offer or
the effectiveness of a Shelf Registration Statement with respect to such Securities, such Securities may be exchanged only in accordance with such procedures as are substantially consistent with the
provisions of this Section 2.3 (including the certification requirements set forth on the reverse of the Initial Securities intended to ensure that such transfers comply with Rule 144A,
Regulation S or such other applicable exemption from registration under the Securities Act, as the case may be) and such other procedures as may from time to time be adopted by the Issuer. 



A-4





 





        (c)   Legend.



        (i)    Except
as permitted by the following paragraphs (ii), (iii) and (iv), each certificate evidencing the Global Securities and the Definitive Securities (and all
Securities issued in exchange therefor or in substitution thereof) shall bear a legend in substantially the following form: 



"THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS NOTE
MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY OF THE ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT WAS
AN AFFILIATE OF THE ISSUER AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE ISSUER, (2) SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS NOTE), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY
THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS NOTE), (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF
APPLICABLE) UNDER THE SECURITIES ACT, OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, REPRESENTS AND AGREES FOR THE BENEFIT OF THE ISSUER THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A OR (2) A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2)(i) OF RULE 902 UNDER)
REGULATION S UNDER THE SECURITIES ACT." 




Each
Definitive Security will also bear the following additional legend: 



"IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE SECURITY REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO
CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS." 



        (ii)   Upon
any sale or transfer of a Transfer Restricted Security (including any Transfer Restricted Security represented by a Global Security) pursuant to Rule 144
under the Securities Act: 



        (A)  in
the case of any Transfer Restricted Security that is a Definitive Security, the Security Registrar shall permit the Holder thereof to exchange such Transfer
Restricted Security for a Security that does not bear the legends set forth above and rescind any restriction on the transfer of such Transfer Restricted Security; and 




A-5





 


        (B)  in
the case of any Transfer Restricted Security that is represented by a Global Security, the Security Registrar shall permit the Holder thereof to exchange such
Transfer Restricted Security for a Security that does not bear the legends set forth above and rescind any restriction on the transfer of such Transfer Restricted Security, 




in
either case, if the Holder certifies in writing to the Security Registrar that its request for such exchange was made in reliance on Rule 144 (such certification to be in the form set forth
on the reverse of the Initial Security). 


        (iii)  After
a transfer of any Initial Securities or Private Exchange Securities, as the case may be, during the period of the effectiveness of a Shelf Registration Statement
with respect to such Initial Securities or Private Exchange Securities, all requirements pertaining to restricted legends on such Initial Security or such Private Exchange Security will cease to apply
and an Initial Security or Private Exchange Security, as the case may be, in global form without restricted legends will be available to the transferee of the beneficial interests of such Initial
Securities or Private Exchange Securities. Upon the occurrence of any of the circumstances described in this paragraph, the Issuer will deliver an Officers' Certificate to the Trustee instructing the
Trustee to issue Securities without restricted legends. 


        (iv)  Upon
the consummation of a Registered Exchange Offer with respect to the Initial Securities pursuant to which certain Holders of such Initial Securities are offered
Exchange Securities in exchange for their Initial Securities, Exchange Securities in global form without the restricted legends will be available to Holders or beneficial owners that exchange such
Initial Securities (or beneficial interests therein) in such Registered Exchange Offer. Upon the occurrence of any of the circumstances described in this paragraph, the Issuer will deliver an
Officers' Certificate to the Trustee instructing the Trustee to issue Securities without restricted legends. 




        (d)   Cancellation or Adjustment of Global Security. At such time as all beneficial interests in a Global Security have either
been exchanged for Definitive Securities, redeemed, repurchased or canceled, such Global Security shall be returned by the Depository to the Trustee for cancellation or retained and canceled by the
Trustee. At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for Definitive Securities, redeemed, repurchased or canceled, the principal amount of
Securities represented by such Global Security shall be reduced and an adjustment shall be made on the books and records of the Trustee (if it is then the Securities Custodian for such Global
Security) with respect to such Global Security, by the Trustee or the Securities Custodian, to reflect such reduction. 


        (e)   Obligations with Respect to Transfers and Exchanges of Securities.



        (i)    To
permit registrations of transfers and exchanges, the Issuer shall execute and the Trustee shall authenticate Definitive Securities and Global Securities at the
Security Registrar's or co-registrar's request. 


        (ii)   No
service charge shall be made for any registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any transfer tax,
assessments, or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charge payable upon exchange or transfer pursuant
to Sections 907, 1013, 1017 and 1108 of this Indenture). 


        (iii)  The
Security Registrar or co-registrar shall not be required to register the transfer of or exchange of any Security for a period beginning 15 days
before the mailing of a notice of redemption or an offer to repurchase Securities or 15 days before an interest payment date. 



        (iv)  Prior
to the due presentation for registration of transfer of any Security, the Issuer, the Trustee, the Paying Agent, the Security Registrar or any
co-registrar may deem and treat the 



A-6





 




person
in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Security and for all other purposes
whatsoever, whether or not such Security is overdue, and none of the Issuer, the Trustee, the Paying Agent, the Security Registrar or any co-registrar shall be affected by notice to the
contrary. 


        (v)   All
Securities issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under
this Indenture as the Securities surrendered upon such transfer or exchange. 




        (f)    No Obligation of the Trustee.



        (i)    The
Trustee shall have no responsibility or obligation to any beneficial owner of a Global Security, a member of, or a participant in the Depository or any other Person
with respect to the accuracy of the records of the Depository or its nominee or of any participant or member thereof, with respect to any ownership interest in the Securities or with respect to the
delivery to any participant, member, beneficial owner or other Person (other than the Depository) of any notice (including any notice of redemption or repurchase) or the payment of any amount, under
or with respect to such Securities. All notices and communications to be given to the Holders and all payments to be made to Holders under the Securities shall be given or made only to the registered
Holders (which shall be the Depository or its nominee in the case of a Global Security). The rights of beneficial owners in any Global Security shall be exercised only through the Depository subject
to the applicable rules and procedures of the Depository. The Trustee may conclusively rely and shall be fully protected in relying upon information furnished by the Depository with respect to its
members, participants and any beneficial owners. 


        (ii)   The
Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under
applicable law with respect to any transfer of any interest in any Security (including any transfers between or among Depository participants, members or beneficial owners in any Global Security)
other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and
to examine the same to determine substantial compliance as to form with the express requirements hereof. 




        2.4
Definitive Securities


        (a)   A
Global Security deposited with the Depository or with the Trustee as Securities Custodian pursuant to Section 2.1 shall be transferred to the beneficial owners
thereof in the form of Definitive Securities in an aggregate principal amount equal to the principal amount of such Global Security, in exchange for such Global Security, only if such transfer
complies with Section 2.3 and (i) the Depository notifies the Issuer that it is unwilling or unable to continue as a Depository for such Global Security or if at any time the Depository
ceases to be a "clearing agency" registered under the Exchange Act, and a successor Depository is not appointed by the Issuer within 90 days of such notice, or (ii) a Default or an Event
of Default has occurred and is continuing or (iii) the Issuer, in its sole discretion, notifies the Trustee in writing that it elects to cause the issuance of Definitive Securities under this
Indenture. 


        (b)   Any
Global Security that is transferable to the beneficial owners thereof pursuant to this Section 2.4 shall be surrendered by the Depository to the Trustee, to
be so transferred, in whole or from time to time in part, without charge, and the Trustee shall authenticate and deliver, upon such transfer of each portion of such Global Security, an equal aggregate
principal amount of Definitive Securities of authorized denominations. Definitive Securities issued in exchange for any portion of a Global Security transferred pursuant to this Section shall be
executed, authenticated and delivered only 


A-7





 



in
denominations of $1,000 and any integral multiple thereof and registered in such names as the Depository shall direct. Any Definitive Security delivered in exchange for an interest in the Global
Security shall, except as otherwise provided by Section 2.3(c), bear the restricted securities legend set forth in Exhibit 1 hereto. 


        (c)   The
registered Holder of a Global Security may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action that a Holder is entitled to take under this Indenture or the Securities. 


        (d)   In
the event of the occurrence of any of the events specified in Section 2.4(a)(i), (ii) or (iii), the Issuer will promptly make available to the Trustee a
reasonable supply of Definitive Securities in definitive, fully registered form without interest coupons. 


A-8






EXHIBIT 1

to APPENDIX A  


[FORM
OF FACE OF INITIAL SECURITY] 


[Global
Securities Legend] 


        UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 


        TRANSFERS
OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF. 


[Restricted
Securities Legend] 


        THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES FOR THE BENEFIT OF THE ISSUER
THAT THIS NOTE MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND
ANNIVERSARY OF THE ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT WAS AN AFFILIATE OF THE ISSUER AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH
TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE ISSUER, (2) SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS NOTE),
(3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
NOTE), (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE ISSUER THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2)(i) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. 


[Definitive
Securities Legend] 





 


[IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE SECURITY REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.] 


2







[FORM OF FACE OF INITIAL SECURITY] 



	No.	 	[up to]** $                  
	

10.750% Senior Note due 2011
	

 	
 	

CUSIP No.             





        LEVEL
3 FINANCING, INC., a Delaware corporation, promises to pay to [Cede & Co.]**, or registered assigns, the principal sum [of
                        Dollars]* [as set forth on
the            Schedule of Increases or Decreases annexed hereto] on October 15, 2011. 



        Interest
Payment Dates: April 15 and October 15. 


        Record
Dates: April 1 and October 1. 




	*
	Insert
for Definitive Securities.



	**
	Insert
for Global Securities. If the Security is to be issued in global form, add the Global Securities Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "TO BE ATTACHED TO GLOBAL SECURITIES—SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY". 






        Additional
provisions of this Security are set forth on the other side of this Security. 


        IN
WITNESS WHEREOF, the parties have caused this instrument to be duly executed. 



	

 	
 	

LEVEL 3 FINANCING, INC.,
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

By:	
 	

 Name:

Title:





	

TRUSTEE'S CERTIFICATE OF AUTHENTICATION	
 	

 
	

Dated:	
 	

 
	

THE BANK OF NEW YORK, as Trustee,	
 	

 
	 	 	certifies that this is one of the Securities referred to in the Indenture.	 	 
	

By:	
 	

 Authorized Signatory	
 	

 









[FORM OF REVERSE SIDE OF INITIAL SECURITY] 


10.750%
Senior Note due 2011 


        1.     Interest


        (a)   LEVEL
3 FINANCING, INC., a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called
the "Issuer"), promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Issuer will pay interest semiannually on April 15 and October 15
of each year, commencing April 15, 2004. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from
October 1, 2003. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. 


        (b)   Special
Interest. The holder of this Security is entitled to the benefits of a Registration Rights Agreement, dated as of October 1, 2003, among Parent, the
Issuer and the Initial Purchasers named therein, or any other similar Registration Rights Agreement for the registration of Additional Securities (each, a "Registration Agreement"). Capitalized terms
used in this paragraph (b) but not defined herein have the meanings assigned to them in the relevant Registration Agreement. If (i) on or prior to April 30, 2005, neither the
Exchange Offer Registration Statement nor the Shelf Registration Statement has been filed with the Commission, (ii) on or prior to June 30, 2005, neither the Exchange Offer Registration
Statement nor the Shelf Registration Statement has been declared effective, (iii) on or prior to July 31, 2005, neither the Exchange Offer has been consummated nor the Shelf Registration
Statement has been declared effective, or (iv) after either the Exchange Offer Registration Statement or the Shelf Registration Statement has been declared effective, such Registration
Statement thereafter ceases to be effective or usable (subject to certain exceptions) in connection with resales of Original Securities or New Securities offered in exchange for such Original
Securities, in accordance with and during the periods specified in, the Registration Agreement (each such event referred to in clauses (i) through (iv), a "Registration Default"), interest
("Special Interest") will accrue on the principal amount of the Original Securities and the New Securities offered in exchange for such Original Securities (in addition to the stated interest on the
Original Securities and such New Securities) from and including the date on which the first such Registration Default shall occur to but excluding the date on which all Registration Defaults have been
cured. Special Interest will accrue at a rate of 0.50% per annum during the 90-day period immediately following the occurrence of such Registration Default and shall increase by 0.25% per
annum at the end of each subsequent 90-day period, but in no event shall such rate exceed 1.00% per annum. Special Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months. 


        2.     Method of Payment


        The
Issuer will pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of business on the April 1 or
October 1 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date. Holders must surrender Securities to a
Paying Agent to collect principal payments. The Issuer will pay principal and interest in money of the United States of America that at the time of payment is legal tender for payment of public and
private debts. Payments in respect of the Securities represented by a Global Security (including principal, premium and interest) will be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company. The Issuer will make all payments in respect of a Definitive Security (including principal, premium and interest), by mailing a check to the
registered address of each Holder thereof; provided, however, that, at the option of the Issuer, payments on the Securities may also be made, in the case of a Holder of at least $1,000,000 aggregate
principal amount of Securities, by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder requests payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the
Trustee may accept in its discretion). 





 



        3.     Paying Agent and Security Registrar


        Initially,
THE BANK OF NEW YORK, a New York banking corporation (the "Trustee"), will act as Paying Agent and Security Registrar. The Issuer may appoint and change any Paying Agent,
Security Registrar or co-registrar without notice. 


        4.     Indenture


        The
Issuer issued the Securities under an Indenture dated as of October 1, 2003 (the "Indenture"), among Parent, the Issuer and the Trustee. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the
date of the Indenture (the "TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all such terms, and Holders are referred to the Indenture and the TIA for a statement of those terms. 



        The
Securities are unsubordinated unsecured obligations of the Issuer. [This Security is one of the Original Securities referred to in the Indenture issued in an aggregate
principal amount of $500,000,000. The Securities include the Original Securities, any Additional Securities, and any Exchange Securities issued in exchange for Original or Additional
Securities]. [This Security is one of the Additional Securities issued in addition to the Original Securities and Exchange Securities issued in exchange therefor in an
aggregate principal amount of $500,000,000 previously issued under the Indenture. The Original Securities, the Exchange Securities issued in exchange for the Original Securities, the Additional
Securities and any Exchange Securities issued in exchange for the Additional Securities are treated as a single class of securities under the Indenture.] The Indenture imposes certain
limitations on the ability of Parent, the Issuer and their respective Restricted Subsidiaries to, among other things, make certain Investments and other Restricted Payments, pay dividends and other
distributions, incur Debt, enter into consensual restrictions upon the payment of certain dividends and distributions by such Restricted Subsidiaries, issue or sell shares of capital stock of such
Restricted Subsidiaries, enter into or permit certain transactions with Affiliates, create or incur Liens and make Asset Sales. The Indenture also imposes limitations on the ability of Parent, the
Issuer and their respective Restricted Subsidiaries to consolidate or merge with or into any other Person or sell, transfer, assign, lease, convey or otherwise dispose of all or substantially all of
the Property of such entities. 


        To
guarantee the due and punctual payment of the principal and interest on the Securities and all other amounts payable by the Issuer under the Indenture and the Securities when and as
the same shall be due and payable, whether at maturity, by acceleration or otherwise, according to the terms of the Securities and the Indenture, Parent has unconditionally guaranteed the Securities
on an unsubordinated basis pursuant to the terms of the Indenture. 


        5.     Optional Redemption


        The
Securities will be subject to redemption at the option of the Issuer, in whole or in part, at any time from time to time on or after October 15, 2007, upon not less than 30
nor more than 60 days' prior notice, at the Redemption Prices set forth below, plus accrued and unpaid interest thereon (if any) to the Redemption Date (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning October 15, of the years
indicated below: 



	Period
 
	 	Redemption Price
	 
	2007	 	105.375	%
	2008	 	102.688	%
	2009 and thereafter	 	100.000	%





2





 

        In
addition, at any time from time to time on or prior to October 15, 2006, the Issuer may redeem up to 35% of the original aggregate principal amount of the Securities at a
Redemption Price equal to 110.750% of the principal amount of the Securities so redeemed, plus accrued and unpaid interest thereof (if any) to the Redemption Date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant Interest Payment Date), with the net cash proceeds contributed to the capital of the Issuer of one or more private placements
to Persons other than Affiliates of Parent or underwritten public offerings of Common Stock of Parent resulting, in each case, in gross proceeds of at least $100,000,000 in the aggregate;  provided,
however, that at least 65% of the original aggregate principal amount of the Securities would
remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days of such private placement or public offering upon not less than 30 nor
more than 60 days' prior notice. 


        6.     Sinking Fund


        The
Securities are not subject to any sinking fund. 


        7.     Notice of Redemption


        Notice
of redemption will be mailed by first-class mail at least 30 days but not more than 60 days prior to the Redemption Date to each Holder of Securities to be redeemed
at his or her registered address. Securities in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000. If money sufficient to pay the Redemption Price of and
accrued interest on all Securities (or
portions thereof) to be redeemed on the Redemption Date is deposited with the Paying Agent on or before the Redemption Date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for redemption. 


        8.     Repurchase of Securities at the Option of Holders upon Change of Control Triggering Event


        Upon
a Change of Control Triggering Event, any Holder of Securities will have the right, subject to certain conditions specified in the Indenture, to cause the Issuer to repurchase all
or any part of the Securities of such Holder at a purchase price equal to 101% of the principal amount of the Securities to be repurchased plus accrued and unpaid interest, if any, to the date of
purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date that is on or prior to the date of purchase) as provided
in, and subject to the terms of, the Indenture. 


        9.     Denominations; Transfer; Exchange


        The
Securities are in registered form without coupons in denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. Upon any transfer or exchange, the Security Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any
taxes required by law or permitted by the Indenture. The Security Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to
be redeemed in part, the portion of the Security not to be redeemed) or to transfer or exchange any Securities for a period of 15 days prior to the mailing of a notice of redemption of
Securities to be redeemed or 15 days before an interest payment date. 



        10.   Persons Deemed Owners


        The
registered Holder of this Security may be treated as the owner of it for all purposes. 


        11.   Unclaimed Money


        If
money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Issuer at its written request unless
an abandoned 


3





 



property
law designates another Person. After any such payment, Holders entitled to the money must look only to the Issuer and not to the Trustee for payment. 


        12.   Discharge and Defeasance


        Subject
to certain conditions, the Issuer at any time may terminate some of or all its obligations under the Securities and the Indenture if the Issuer deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity, as the case may be. 


        13.   Amendment, Waiver


        Subject
to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended without prior notice to any Holder but with the written consent of the
Holders of at least a majority (or, with respect to certain covenants, the written consent of at least two-thirds) in aggregate principal amount of the Outstanding Securities and
(ii) any default or noncompliance with any provision may be waived with the written consent of the Holders of at least a majority in principal amount of the Outstanding Securities. Subject to
certain exceptions set forth in the Indenture, without the consent of any Holder of Securities, the Issuer and the Trustee may amend the Indenture or the Securities (i) to evidence the
succession of another Person to the Issuer, Parent or any other Guarantor and the assumption by such successor of the covenants of the Issuer, Parent or any other Guarantor, respectively, in the
Indenture, the Securities and the applicable Note Guarantee, (ii) to add to the covenants of Parent, the Issuer or any of their respective Subsidiaries, for the benefit of the Holders,
or to surrender any right or power conferred upon Parent, the Issuer or any other Guarantor by the Indenture; (iii) to add any additional Events of Default; (iv) to provide for
uncertificated Securities in addition to or in place of certificated Securities; (v) to evidence and provide for the acceptance of appointment under the Indenture of a successor Trustee;
(vi) to secure the Securities; (vii) to comply with the Trust Indenture Act or the Securities Act (including Regulation S promulgated thereunder); (viii) to add additional
Note Guarantees or to release any Guarantors from Note Guarantees as provided by the terms of the Indenture; (ix) to subordinate Note Guarantees under the circumstances and
to the extent set forth in the Indenture; and (x) to cure any ambiguity in the Indenture, to correct or supplement any provision in the Indenture which may be inconsistent with any other
provision therein or to add any other provision with respect to matters or questions arising under the Indenture; provided such actions shall not
adversely affect the interests of the Holders in any material respect. 


        14.   Defaults and Remedies


        If
an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding, subject to certain
limitations, may declare all the Securities to be immediately due and payable. Certain events of bankruptcy or insolvency are Events of Default and shall result in the Securities being immediately due
and payable upon the occurrence of such Events of Default without any further act of the Trustee or any Holder. 



        Holders
of Securities may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or the Securities unless it
receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the Trustee in its exercise
of any trust or power under the Indenture. The Holders of a majority in aggregate principal amount of the Securities then outstanding, by written notice to the Issuer and the Trustee, may rescind any
declaration of acceleration and its consequences if the rescission would not conflict with any judgment or decree, and if all existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of the acceleration. 


4





 



        15.   Trustee Dealings with the Issuer


        Subject
to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may
otherwise deal with and collect obligations owed to it by the Issuer or its Affiliates and may otherwise deal with the Issuer or its Affiliates with the same rights it would have if it were not
Trustee. 


        16.   No Recourse Against Others


        A
director, officer, employee, incorporator or stockholder, as such, of the Issuer or any Guarantor shall not have any liability for any obligations of the Issuer under the Securities or
the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation, solely by reason of its status as a director, officer, employee, incorporator or stockholder
of such Person. By accepting a Security, each Securityholder waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. 



        17.   Authentication


        This
Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this
Security. 


        18.   Abbreviations


        Customary
abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants
with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act). 


        19.   Governing Law


        THIS
SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 


        20.   CUSIP Numbers


        Pursuant
to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused CUSIP numbers to be printed on the Securities and has
directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Securities or as
contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. 



        The Issuer will furnish to any Holder of Securities upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this
Security.


5






ASSIGNMENT FORM  


To
assign this Security, fill in the form below: 



I
or we assign and transfer this Security to 








(Print or type assignee's name, address and zip code) 








(Insert assignee's soc. sec. or tax I.D. No.) 


and
irrevocably appoint                        agent to transfer this Security on the books of the Issuer. The agent may substitute
another to act for him. 








	Date:	 	 	 	Your Signature:	 	 
	 	 	
	 	 	 	

	Sign exactly as your name appears on the other side of this Security.





In
connection with any transfer of any of the Securities evidenced by this certificate occurring prior to the expiration of the period referred to in Rule 144(k) under the Securities Act
after the later of the date of original issuance of such Securities and the last date, if any, on which such Securities were owned by the Issuer or any Affiliate of the Issuer, the undersigned
confirms that such Securities are being transferred in accordance with its terms: 


CHECK
ONE BOX BELOW 



	(1)	 	o	 	to the Issuer; or
	

(2)	
 	

o	
 	

pursuant to an effective registration statement under the Securities Act of 1933; or
	

(3)	
 	

o	
 	

inside the United States to a "qualified institutional buyer" (as defined in Rule 144A under the Securities Act of 1933) that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that such
transfer is being made in reliance on Rule 144A, in each case pursuant to and in compliance with Rule 144A under the Securities Act of 1933; or
	

(4)	
 	

o	
 	

outside the United States in an offshore transaction within the meaning of Regulation S under the Securities Act in compliance with Rule 904 under the Securities Act of 1933; or
	

(5)	
 	

o	
 	

pursuant to another available exemption from registration provided by Rule 144 under the Securities Act of 1933.





Unless
one of the boxes is checked, the Trustee will refuse to register any of the Securities evidenced by this certificate in the name of any person other than the registered holder thereof;  provided,
however, that if box (4) or (5) is checked, the Trustee may require, prior to
registering any such transfer of the Securities, such legal opinions, certifications and other information as the Issuer has reasonably 





 



requested
to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933. 



	 	 	 	 	
 Your signature
	

Signature Guarantee:	
 	

 
	

Date:	
 	

 	
 	

 
	

 	
 	

 Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor acceptable to the Trustee	
 	

 Signature of Signature Guarantee




TO
BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED: 


        The
undersigned represents and warrants that it is purchasing this Security for its own account or an account with respect to which it exercises sole investment discretion and that it
and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act of 1933, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the Issuer as the undersigned has requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A. 



	Dated:	 	 	 	 
	 	 	
	 	

	 	 	 	 	NOTICE: To be executed by an executive officer




2





 
[TO
BE ATTACHED TO GLOBAL SECURITIES] 


SCHEDULE
OF INCREASES OR DECREASES IN GLOBAL SECURITY 


        The
initial principal amount of this Global Security is $[            ]. The following increases or decreases in this Global Security have been made: 


3





 


	Date of Exchange
	 	Amount of decrease in Principal Amount of this Global Security
	 	Amount of increase in Principal Amount of this Global Security
	 	Principal amount of this Global Security following such decrease or increase
	 	Signature of authorized signatory of Trustee or Securities Custodian





OPTION OF HOLDER TO ELECT PURCHASE  


        If you want to elect to have this Security purchased by the Issuer pursuant to Section 1016 (Asset Sale) or 1009 (Change of Control
Triggering Event) of the Indenture, check the box:


o



        If you want to elect to have only part of this Security purchased by the Issuer pursuant to Section 1016 or 1009 of the Indenture,
state the amount:


$  



	Date:	 	 	 	Your Signature:	 	 
	 	 	
	 	 	 	

	Sign exactly as your name appears on the other side of this Security.
	

Signature Guarantee:	
 	

 	
 	

 
	 	 	 	 	
 Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor acceptable to the Trustee.




4






EXHIBIT A  


[FORM
OF FACE OF SECURITY] 



	No.	 	[up to]** $                  
	

10.750% Senior Note due 2011
	

 	
 	

CUSIP No.             





        LEVEL
3 FINANCING, INC., a Delaware corporation, promises to pay to [Cede & Co.]** or registered assigns, the principal sum [of
                        Dollars]* [as set forth on the Schedule of Increases or Decreases annexed hereto] on October 15,
2011. 


        Interest
Payment Dates: April 15 and October 15. 


        Record
Dates: April 1 and October 1. 




	*
	Insert
for Definitive Securities.



	**
	If
the Security is to be issued in global form, add the Global Securities Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1 captioned "TO BE ATTACHED TO GLOBAL
SECURITIES—SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY". 






        Additional
provisions of this Security are set forth on the other side of this Security. 


        IN
WITNESS WHEREOF, the parties have caused this instrument to be duly executed. 



	

 	
 	

LEVEL 3 FINANCING, INC.,
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

By:	
 	

 Name:

Title:





	

TRUSTEE'S CERTIFICATE OF AUTHENTICATION	
 	

 
	

Dated:	
 	

 
	

THE BANK OF NEW YORK,	
 	

 
	 	 	as Trustee, certifies that this is one of the Securities referred to in the Indenture.	 	 
	

By:	
 	

 Authorized Signatory	
 	

 









[FORM OF REVERSE SIDE OF SECURITY] 


10.750%
Senior Note due 2011 


        1.     Interest


        LEVEL
3 FINANCING, INC., a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the "Issuer"),
promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Issuer will pay interest semiannually on April 15 and October 15 of each year.
Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from October 1, 2003. Interest shall be computed on the basis
of a 360-day year of twelve 30-day months. 


        2.     Method of Payment


        The
Issuer will pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of business on the April 1 or
October 1 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date. Holders must surrender Securities to a
Paying Agent to collect principal payments. The Issuer will pay principal and interest in money of the United States of America that at the time of payment is legal tender for payment of public and
private debts. Payments in respect of the Securities represented by a Global Security (including principal, premium and interest) will be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company. The Issuer will make all payments in respect of a Definitive Security (including principal, premium and interest), by mailing a check to the
registered address of each Holder thereof; provided, however, that, at the option of the Issuer, payments on the Securities may also be made, in the case of a Holder of at least $1,000,000 aggregate
principal amount of Securities, by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder requests payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the
Trustee may accept in its discretion). 


        3.     Paying Agent and Security Registrar


        Initially,
THE BANK OF NEW YORK, a New York banking corporation (the "Trustee"), will act as Paying Agent and Security Registrar. The Issuer may appoint and change any Paying Agent,
Security Registrar or co-registrar without notice. 


        4.     Indenture


        The
Issuer issued the Securities under an Indenture dated as of October 1, 2003 (the "Indenture"), among Parent, the Issuer and the Trustee. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the
date of the Indenture (the "TIA"). Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all such terms, and Holders
are referred to the Indenture and the TIA for a statement of those terms. 


        The
Securities are unsubordinated unsecured obligations of the Issuer. [This Security is one of the Original Securities referred to in the Indenture issued in an aggregate
principal amount of $500,000,000. The Securities include the Original Securities, any Additional Securities, and any Exchange Securities issued in exchange for Original or Additional
Securities]. [This Security is one of the Additional Securities issued in addition to the Original Securities and Exchange Securities issued in exchange therefor in an
aggregate principal amount of $500,000,000 previously issued under the Indenture. The Original Securities, the Exchange Securities issued in exchange for the Original Securities, the Additional
Securities and any Exchange Securities issued in exchange for the Additional Securities are treated as a single class of securities under the Indenture.] The Indenture imposes certain
limitations on the ability of Parent, the Issuer and their respective Restricted Subsidiaries to, among other things, make certain Investments and other Restricted Payments, pay dividends and other 





 



distributions,
incur Debt, enter into consensual restrictions upon the payment of certain dividends and distributions by such Restricted Subsidiaries, issue or sell shares of capital stock of such
Restricted Subsidiaries, enter into or permit certain transactions with Affiliates, create or incur Liens and make Asset Sales. The Indenture also imposes limitations on the ability of Parent, the
Issuer and their respective Restricted Subsidiaries to consolidate or merge with or into any other Person or sell, transfer, assign, lease, convey or otherwise dispose of all or substantially all of
the Property of such entities. 


        To
guarantee the due and punctual payment of the principal and interest on the Securities and all other amounts payable by the Issuer under the Indenture and the Securities when and as
the same shall be due and payable, whether at maturity, by acceleration or otherwise, according to the terms of the Securities and the Indenture, Parent has unconditionally guaranteed the Securities
on an unsubordinated basis pursuant to the terms of the Indenture. 


        5.     Optional Redemption


        The
Securities will be subject to redemption at the option of the Issuer, in whole or in part, at any time from time to time on or after October 15, 2007, upon not less than 30
nor more than 60 days' prior notice, at the Redemption Prices set forth below, plus accrued and unpaid interest thereon (if any) to the Redemption Date (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning October 15, of the years
indicated below: 



	Period
 
	 	Redemption Price
	 
	2007	 	105.375	%
	2008	 	102.688	%
	2009 and thereafter	 	100.000	%






        In
addition, at any time from time to time on or prior to October 15, 2006, the Issuer may redeem up to 35% of the original aggregate principal amount of the Securities at a
Redemption Price equal to 110.750% of the principal amount of the Securities so redeemed, plus accrued and unpaid interest thereof (if any) to the Redemption Date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant Interest Payment Date), with the net cash proceeds contributed to the capital of the Issuer of one or more private placements
to Persons other than Affiliates of Parent or underwritten public offerings of Common Stock of Parent resulting, in each case, in gross proceeds of at least $100,000,000 in the aggregate;  provided,
however, that at least 65% of the original aggregate principal amount of the Securities would
remain outstanding immediately after giving
effect to such redemption. Any such redemption shall be made within 90 days of such private placement or public offering upon not less than 30 nor more than 60 days' prior notice. 


        6.     Sinking Fund


        The
Securities are not subject to any sinking fund. 


        7.     Notice of Redemption


        Notice
of redemption will be mailed by first-class mail at least 30 days but not more than 60 days prior to the Redemption Date to each Holder of Securities to be redeemed
at his or her registered address. Securities in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000. If money sufficient to pay the Redemption Price of and
accrued interest on all Securities (or portions thereof) to be redeemed on the Redemption Date is deposited with the Paying Agent on or before the Redemption Date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Securities (or such portions thereof) called for redemption. 


2





 



        8.     Repurchase of Securities at the Option of Holders upon Change of Control Triggering Event


        Upon
a Change of Control Triggering Event, any Holder of Securities will have the right, subject to certain conditions specified in the Indenture, to cause the Issuer to repurchase all
or any part of the Securities of such Holder at a purchase price equal to 101% of the principal amount of the Securities to be repurchased plus accrued and unpaid interest, if any, to the date of
purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date that is on or prior to the date of purchase) as provided
in, and subject to the terms of, the Indenture. 


        9.     Denominations; Transfer; Exchange


        The
Securities are in registered form without coupons in denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. Upon any transfer or exchange, the Security Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any
taxes required by law or
permitted by the Indenture. The Security Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the
portion of the Security not to be redeemed) or to transfer or exchange any Securities for a period of 15 days prior to the mailing of a notice of redemption of Securities to be redeemed or
15 days before an interest payment date. 


        10.   Persons Deemed Owners



        The
registered Holder of this Security may be treated as the owner of it for all purposes. 


        11.   Unclaimed Money


        If
money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Issuer at its written request unless
an abandoned property law designates another Person. After any such payment, Holders entitled to the money must look only to the Issuer and not to the Trustee for payment. 


        12.   Discharge and Defeasance


        Subject
to certain conditions, the Issuer at any time may terminate some of or all its obligations under the Securities and the Indenture if the Issuer deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity, as the case may be. 


        13.   Amendment, Waiver


        Subject
to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may be amended without prior notice to any Holder but with the written consent of the
Holders of at least a majority (or, with respect to certain covenants, the written consent of at least two-thirds) in aggregate principal amount of the Outstanding Securities and
(ii) any default or noncompliance with any provision may be waived with the written consent of the Holders of at least a majority in principal amount of the Outstanding Securities. Subject to
certain exceptions set forth in the Indenture, without the consent of any Holder of Securities, the Issuer and the Trustee may amend the Indenture or the Securities (i) to evidence the
succession of another Person to the Issuer, Parent or any other Guarantor and the assumption by such successor of the covenants of the Issuer, Parent or any other Guarantor, respectively, in the
Indenture, the Securities and the applicable Note Guarantee, (ii) to add to the covenants of Parent, the Issuer or any of their respective Subsidiaries, for the benefit of the Holders,
or to surrender any right or power conferred upon Parent, the Issuer or any other Guarantor by the Indenture; (iii) to add any additional Events of Default; (iv) to provide for
uncertificated Securities in addition to or in place of certificated Securities; (v) to evidence and provide for the acceptance of 


3





 



appointment
under the Indenture of a successor Trustee; (vi) to secure the Securities; (vii) to comply with the Trust Indenture Act or the Securities Act (including Regulation S
promulgated thereunder); (viii) to add additional Note Guarantees or to release any Guarantors from Note Guarantees as provided by the terms of the Indenture; (ix) to
subordinate Note Guarantees under the circumstances and to the extent set forth in the Indenture; and (x) to cure any ambiguity in the Indenture, to correct or supplement any provision
in the Indenture which may be inconsistent with any other provision therein or to add any other provision with respect to matters or questions arising under the Indenture;  provided such actions shall
not adversely affect the interests of the Holders in any material respect. 


        14.   Defaults and Remedies


        If
an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding, subject to certain
limitations, may declare all the Securities to be immediately due and payable. Certain events of bankruptcy or insolvency are Events of Default and shall result in the Securities being immediately due
and payable upon the occurrence of such Events of Default without any further act of the Trustee or any Holder. 


        Holders
of Securities may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or the Securities unless it
receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the Trustee in its exercise
of any trust or power under the Indenture. The Holders of a majority in aggregate principal amount of the Securities then outstanding, by written notice to the Issuer and the Trustee, may rescind any
declaration of acceleration and its consequences if the rescission would not conflict with any judgment or decree, and if all existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of the acceleration. 


        15.   Trustee Dealings with the Issuer


        Subject
to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may
otherwise deal with and collect obligations owed to it by the Issuer or its Affiliates and may otherwise deal with the Issuer or its Affiliates with the same rights it would have if it were not
Trustee. 


        16.   No Recourse Against Others


        A
director, officer, employee, incorporator or stockholder, as such, of the Issuer or any Guarantor shall not have any liability for any obligations of the Issuer under the Securities or
the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation, solely by reason of its status as a director, officer, employee, incorporator or stockholder
of such Person. By accepting a Security, each Securityholder waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. 



        17.   Authentication


        This
Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this
Security. 


        18.   Abbreviations


        Customary
abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants
with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act). 


4





 



        19.   Governing Law


        THIS
SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 


        20.   CUSIP Numbers


        Pursuant
to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused CUSIP numbers to be printed on the Securities and has
directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Securities or as
contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. 



        The Issuer will furnish to any Holder of Securities upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this
Security.


5






ASSIGNMENT FORM 


To
assign this Security, fill in the form below: 



I
or we assign and transfer this Security to 








(Print or type assignee's name, address and zip code) 








(Insert assignee's soc. sec. or tax I.D. No.) 


and
irrevocably appoint                        agent to transfer this Security on the books of the Issuer. The agent may substitute
another to act for him. 








	Date:	 	 	 	Your Signature:	 	 
	 	 	
	 	 	 	

	Sign exactly as your name appears on the other side of this Security. Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor acceptable
to the Trustee.







 
OPTION OF HOLDER TO ELECT PURCHASE  


        If you want to elect to have this Security purchased by the Issuer pursuant to Section 1016 (Asset Sale) or 1009 (Change of Control
Triggering Event) of the Indenture, check the box:


o 


        If you want to elect to have only part of this Security purchased by the Issuer pursuant to Section 1016 or 1009 of the Indenture,
state the amount:


$  



	Date:	 	 	 	Your Signature:	 	 
	 	 	
	 	 	 	

	(Sign exactly as your name appears on the other side of the Security)
	

Signature Guarantee:	
 	

 	
 	

 
	 	 	 	 	
 Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor acceptable to the Trustee.




2






EXHIBIT B  


INCUMBENCY CERTIFICATE  


        The undersigned,                        , being
the                        of                 
       (the "Company") does hereby certify that the individuals listed below are qualified
and acting officers of the Company as set forth in the right column opposite their respective names and the signatures appearing in the extreme right column opposite the name of each such officer is a
true specimen of the genuine signature of such officer and such individuals have the authority to execute documents to be delivered to, or upon the request of, The Bank of New York, as Trustee under
the Indenture dated as of                            , 20    , among the Company, [Level 3
Communications, Inc./Level 3 Financing, Inc.] and The Bank
of New York. 



	Name
 
	 	Title
	 	Signature

	
	 	
	 	

	

	
 	

	
 	


	

	
 	

	
 	







        IN
WITNESS WHEREOF, the undersigned has duly executed and delivered this Certificate as of the            day of            ,
20    . 



	 	 	
 Name:

Title:








   EXHIBIT C  


FORM OF SUPPLEMENTAL INDENTURE  




        SUPPLEMENTAL
INDENTURE (this "Supplemental Indenture") dated as of                        , among [GUARANTOR] (the "New Guarantor"), a direct
or indirect subsidiary of
Level 3 Communications, Inc. (or its successor), a Delaware corporation ("Parent"), LEVEL 3 FINANCING, INC., a Delaware corporation (the "Issuer") on behalf of itself and the Guarantors
(the "Existing Guarantors"), if any, under the Indenture referred to below, and THE BANK OF NEW YORK, a New York banking corporation, as trustee under the indenture referred to below (the "Trustee"). 




W I T N E S S E T H:  


        WHEREAS the Issuer and Parent have heretofore executed and delivered to the Trustee an Indenture dated as of October 1, 2003 (the "Indenture"; capitalized
terms used but not defined herein having the meanings assigned thereto in the Indenture), providing for the issuance of its 10.75% Senior Notes Due 2011; 


        WHEREAS
the Indenture permits the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the
Issuer's obligations under the Securities pursuant to a Guarantee on the terms and conditions set forth herein; 



        WHEREAS
the Guarantee contained in this Supplemental Indenture shall constitute a "Restricted Subsidiary Guarantee", and the New Guarantor shall constitute a "Guarantor", for all
purposes of the Indenture; and 


        WHEREAS
pursuant to Section 901 and Section 1307 of the Indenture, the Trustee and the Issuer are authorized to execute and deliver this Supplemental Indenture; 


        NOW
THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor, the Issuer, the Existing
Guarantors and the Trustee mutually covenant and agree for the equal and ratable benefit of the holders of the Securities as follows: 



        1.     Agreement to Guaranty. The New Guarantor hereby agrees, jointly and severally with all the existing Guarantors, to
unconditionally guarantee the Issuer's obligations under the Securities on the terms and subject to the conditions set forth in Article 13 of the Indenture and to be bound by all other
applicable provisions of the Indenture and the Securities. 


        2.     Successors and Assigns. This Supplemental Indenture shall be binding upon the New Guarantor and its successors and assigns
and shall enure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and
privileges conferred upon that party in the Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of this
Indenture. 


        3.     No Waiver. Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power
or privilege under this Supplemental Indenture, the Indenture or the Securities shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise
of any right, power or privilege. The rights, remedies and benefits of the Trustee and the Holders herein and therein expressly specified are cumulative and not exclusive of any 


C-1





 



other
rights, remedies or benefits which either may have under this Supplemental Indenture, the Indenture or the Securities at law, in equity, by statute or otherwise. 


        4.     Modification. No modification, amendment or waiver of any provision of this Supplemental Indenture, nor the consent to any
departure by the New Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice to or demand on the New Guarantor in any case shall entitle the New Guarantor to any other or further notice or demand in the same,
similar or other circumstances. 


        5.     Opinion of Counsel. Concurrently with the execution and delivery of this Supplemental Indenture, the Issuer shall deliver
to the Trustee an Opinion of Counsel to the effect that this Supplemental Indenture has been duly authorized, executed and delivered by each of the New Guarantor and the Issuer and that, subject to
the application of bankruptcy, insolvency, moratorium, fraudulent conveyance or transfer and other similar laws relating to creditors' rights generally and to the principles of equity, whether
considered in a proceeding at law or in equity, the Guarantee of the New Guarantor is a legal, valid and binding obligation of the New Guarantor, enforceable against the New Guarantor in accordance
with its terms. 


        6.     Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is
in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the Indenture
for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby. 



        7.     Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY.


        8.     Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement. 



        9.     Effect of Headings. The Section headings herein are for convenience only and shall not effect the construction
thereof. 


C-2





 

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



	

 	
 	

[NEW GUARANTOR],
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

LEVEL 3 FINANCING, INC., on behalf of itself as the Issuer and the Existing Guarantors, if any,
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

THE BANK OF NEW YORK, as Trustee,
	

 	
 	

By:	
 	

 Name:

Title:




C-3






   EXHIBIT D  




        SUBORDINATION
AGREEMENT dated as of October [    ], 2003 among LEVEL 3 FINANCING, INC. (the "Issuer"), LEVEL 3 COMMUNICATIONS, LLC ("Level
3 LLC"), each Issuer Restricted Subsidiary (as defined in the Indenture described below) that becomes party hereto as provided in Section 4.12 hereto (each such Issuer Restricted Subsidiary and
Level 3 LLC individually, a "Subordinated Borrower," and collectively, the "Subordinated Borrowers"), LEVEL 3 COMMUNICATIONS, INC. ("Parent"), each Sister Restricted Subsidiary (as defined in
the Indenture described below) that becomes party hereto as provided in Section 4.13 hereto (each such Sister Restricted Subsidiary and Parent individually, a "Subordinated Lender," and
collectively, the "Subordinated Lenders"). 





        Reference
is made to (a) the Purchase Agreement dated September 26, 2003 (the "Purchase Agreement") among the initial purchasers party thereto (the "Purchasers"), the
Issuer and Parent, (b) the Indenture dated October 1, 2003 (the "Indenture") among the Issuer, Parent and The Bank of New York, as trustee (in such capacity, the "Trustee"),
(c) the intercompany demand note dated the Issue Date, in an initial principal amount equal to $500,000,000, issued by Level 3 LLC to the Issuer, as it may be amended from time to time pursuant
to Sections 301 and 1020 of the Indenture (the "Offering Proceeds Note") and (d) the intercompany demand note dated the date hereof (the "Parent Intercompany Note") issued by Level 3 LLC
to Parent, the outstanding balance of which, as of June 30, 2003, was $11,547,230,519. Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in
the Indenture. 


        The
Issuer has agreed to sell to the Purchasers, upon the terms set forth in the Purchase Agreement, its 10.75% Senior Notes due 2011 (the "Securities") to be guaranteed on an unsecured
unsubordinated basis by Parent. The obligation of the Purchasers to purchase the Securities is conditioned on, among other things, the execution and delivery by Parent, the Issuer and Level 3 LLC of a
subordination agreement in the form hereof. Additionally, upon the incurrence of certain intercompany indebtedness, the Indenture requires Restricted Subsidiaries of Parent (other than the Issuer) to
guarantee the Offering Proceeds Note (each such guarantee, an "Offering Proceeds Note Guarantee", and each such Restricted Subsidiary that provides such a guarantee, an "Offering Proceeds Note
Guarantor") and to subordinate their obligations with respect to such newly incurred indebtedness to their obligations with respect to their Offering Proceeds Note Guarantee. Offering Proceeds
Note Guarantors required to provide subordination with respect to intercompany indebtedness and the creditors on such indebtedness are required to become parties to this Subordination
Agreement, if they are not yet parties. In order to induce the Purchasers to purchase the Securities, Parent, the Issuer and Level 3
LLC are willing to execute and deliver this Agreement. Accordingly, Parent, as a Subordinated Lender, the Issuer and Level 3 LLC, as a Subordinated Borrower, hereby agree as follows: 


ARTICLE I  


 Subordination  


        SECTION 1.1. Subordination. Each Subordinated Lender hereby agrees that all obligations in respect of any Debt
owed to such Subordinated Lender by any Subordinated Borrower, including the payment of principal, premium (if any), interest, Guarantees or all other amounts payable thereunder (the "Subordinated
Obligations"), are subordinate and junior in right of payment, to the extent and in the manner provided in this Article I, to the prior payment in full in cash of all obligations of such
Subordinated Borrower in respect of the Offering Proceeds Note, including the payment of principal, premium (if any), interest (including interest arising after the commencement of a bankruptcy or
other proceeding, whether or not such a claim is permitted in such proceeding), Offering Proceeds Note Guarantees thereof or all other amounts payable thereunder (the "Senior Obligations"). 


D-1





 



        SECTION
1.2. Subordination in the Event of Dissolution or Insolvency of any Subordinated Borrower. Subject to the terms of a subordination
agreement entered into pursuant to Section 4.14, upon any distribution of the assets of any Subordinated Borrower in connection with its dissolution or insolvency or upon any dissolution,
winding up, liquidation or reorganization of any Subordinated Borrower, whether in bankruptcy, insolvency, reorganization, arrangement or receivership or similar proceedings, or upon any assignment
for the benefit of creditors or any other marshaling of the assets and liabilities of any Subordinated Borrower: 


        (a)   the
Issuer shall first be entitled to receive payment in full in cash of the Senior Obligations of such Subordinated Borrower in accordance with the terms of such Senior
Obligations before any Subordinated Lender shall be entitled to receive any payment on account of the Subordinated Obligations owed by such Subordinated Borrower to such Subordinated Lender, whether
as principal, premium (if any), interest, pursuant to an Offering Proceeds Note Guarantee or otherwise; and 



        (b)   any
payment by, or distribution of the assets of, such Subordinated Borrower of any kind or character, whether in cash, property or securities, to which any Subordinated
Lender would be entitled except for the provisions of this Agreement shall be paid or delivered by the Person making such payment or distribution (whether a trustee in bankruptcy, a receiver,
custodian or liquidating trustee or otherwise) directly to the Issuer to the extent necessary to make payment in full in cash of all Senior Obligations remaining unpaid, after giving effect to any
concurrent payment or distribution to the Issuer in respect of the Senior Obligations. 


In
the event of any proceeding involving any Subordinated Borrower under any bankruptcy, insolvency, reorganization, receivership or similar law, each Subordinated Lender agrees, until the
indefeasible payment in full of all monetary Senior Obligations, not to ask, demand, sue for or take or receive from any Subordinated Borrower in cash, securities or other property or by setoff,
purchase or redemption (including, without limitation, from or by way of collateral), payment of all or any part of the Subordinated Obligations owed to such Subordinated Lender (other than payments
permitted pursuant to clause (b) above) and agrees that in connection with any proceeding involving any Subordinated Borrower under any bankruptcy, insolvency, reorganization,
receivership or similar law (i) the Issuer is irrevocably authorized and empowered (in its own name or in the name of such Subordinated Borrower or otherwise), but shall have no obligation, to
demand, sue for, collect and receive every payment or distribution referred to in the preceding sentence and give acquittance therefor and to file claims and proofs of claim and take such other action
(including, without limitation, voting the applicable Subordinated Obligations and enforcing any security interest or other lien securing payment of such Subordinated Obligations) as the Issuer may
deem necessary or advisable for the exercise or enforcement of any of its rights or interests and (ii) each Subordinated Lender shall duly and promptly take such action as the Issuer may
reasonably request to (A) collect amounts in respect of the applicable Subordinated Obligations for the account of the Issuer and to file appropriate claims or proofs of claim in respect of
such Subordinated Obligations, (B) execute and deliver to the Issuer such irrevocable powers of attorney, assignments or other instruments as the Issuer may reasonably request in order to
enable the Issuer to enforce any and all claims with respect to, and any security interests and other liens securing payment of, the applicable Subordinated Obligations and (C) collect and
receive any and all payments or distributions which may be payable or deliverable upon or with respect to the applicable Subordinated Obligations. A copy of this Agreement may be filed with any court
as evidence of the Issuer's right, power and authority hereunder. 


        SECTION
1.3. Certain Payments Held in Trust. Subject to the terms of a subordination agreement entered into pursuant to
Section 4.14, in the event that any payment by, or distribution of the assets of, any Subordinated Borrower of any kind or character, whether in cash, property or securities, and whether
directly or otherwise, shall be received by or on behalf of any Subordinated Lender at a time when such payment is prohibited by this Agreement, such payment or distribution shall be held in trust for
the benefit of, and shall be paid over to, the Issuer to the extent necessary to make payment in full 


D-2





 



in
cash of all Senior Obligations remaining unpaid, after giving effect to any concurrent payment or distribution to the Issuer in respect of such Senior Obligations. 


        SECTION
1.4. Subrogation. Subject to the prior indefeasible payment in full in cash of the Senior Obligations, each Subordinated Lender
shall be subrogated to the rights of the Issuer to receive payments or distributions in cash, property or securities of each applicable Subordinated Borrower in respect of the Senior Obligations until
all amounts owing on the applicable Subordinated Obligations shall be paid in full, and as between and among a Subordinated Borrower, its creditors (other than the Issuer) and the applicable
Subordinated Lender, no such payment or distribution made to the Issuer by virtue of this Agreement that otherwise would have been made to such Subordinated Lender shall be deemed to be a payment by
such Subordinated Borrower on account of such Subordinated Obligations, it being understood that the provisions of this Agreement are intended solely for the purpose of defining the relative rights of
the Subordinated Lenders, on the one hand, and the Issuer, on the other hand. 


ARTICLE II  


 Other Matters Regarding the Subordinated Obligations  


        SECTION 2.1. Other Creditors. Except in the limited circumstances set forth in Article I, nothing contained
in this Agreement is intended to or shall impair, as between and among a Subordinated Borrower, its creditors and any Subordinated Lender, the obligations of such Subordinated Borrower to pay to such
Subordinated Lender the Subordinated Obligations of such Subordinated Borrower as and when the same shall become payable in accordance with the terms thereof, or affect the relative rights of such
Subordinated Lender and the other creditors of such Subordinated Borrower. 


        SECTION
2.2. Proofs of Claims. In the event of any dissolution, winding up, liquidation or reorganization of any Subordinated Borrower,
whether in bankruptcy, insolvency, reorganization, arrangement or receivership proceedings or otherwise, or any assignment for the benefit of creditors or any other marshaling of the assets and
liabilities of any Subordinated Borrower, each Subordinated Lender agrees to file proofs of claim for the Subordinated Obligations owed to it upon demand of the Issuer, in default of which the Issuer
or an authorized representative of the Issuer is hereby irrevocably authorized so to file in order to effectuate the provisions hereof. This Section shall not be construed to permit any
Subordinated Lender to retain any payment received by it in respect of a Subordinated Obligation that such Subordinated Lender is not entitled to receive and retain under any other provision of this
Agreement. 


        SECTION
2.3. Waivers. (a) Each Subordinated Lender waives the right to compel any assets or property of any Subordinated Borrower
or the assets or property of any Offering Proceeds Note Guarantor or any other Person to be applied in any particular order to discharge the Senior Obligations. Each Subordinated Lender
expressly waives the right to require the Issuer to proceed against any Subordinated Borrower, any Offering Proceeds Note Guarantor or any other Person, or to pursue any other remedy in the Issuer's
power which such Subordinated Lender cannot pursue and which would lighten such Subordinated Lender's burden, notwithstanding that the failure of the Issuer to do so may thereby prejudice such
Subordinated Lender. Each Subordinated Lender agrees that it shall not be discharged, exonerated or have its obligations hereunder to the Issuer reduced (i) by the Issuer's delay in proceeding
against or enforcing any remedy against any Subordinated Borrower, any Offering Proceeds Note Guarantor or any other Person; (ii) by the Issuer releasing any Subordinated Borrower, any Offering
Proceeds Note Guarantor or any other Person from all or any part of the Senior Obligations; or (iii) by the discharge of any Subordinated Borrower, any Offering Proceeds
Note Guarantor or any other Person by an operation of law or otherwise, with or without the intervention or omission of the Issuer, except in each case unless all Senior Obligations due to the
Issuer have been indefeasibly paid in full in cash. The Issuer's vote to accept or reject any plan of 


D-3





 



reorganization
relating to any Subordinated Borrower, any Offering Proceeds Note Guarantor or any other Person, or the Issuer's receipt on account of all or part of the Senior Obligations of
any cash, securities or other property distributed in any bankruptcy, reorganization, or insolvency case, shall not discharge, exonerate, or reduce the obligations of any Subordinated Lender hereunder
to the Issuer, except in each case unless all Senior Obligations have been indefeasibly paid in full in cash. 


        (b)   Each
Subordinated Lender waives all rights and defenses arising out of an election of remedies by the Issuer, even though that election of remedies, including, without
limitation, any nonjudicial foreclosure with respect to security for the Senior Obligations, has impaired the value of such Subordinated Lender's rights of subrogation, reimbursement, or contribution
against any Subordinated Borrower, any Offering Proceeds Note Guarantor or any other Person. Each Subordinated Lender expressly waives any rights or defenses it may have by reason of protection
afforded to any Subordinated Borrower, any Offering Proceeds Note Guarantor or any other Person with respect to the Senior Obligations pursuant to any anti deficiency laws or other laws of
similar import which limit or discharge the principal debtor's indebtedness upon judicial or nonjudicial foreclosure of real property or personal property collateral for the Senior Obligations, if
any. 


        (c)   Each
Subordinated Lender agrees that, without the necessity of any reservation of rights against it, and without notice to or further assent by it, any demand for
payment of the Senior Obligations made by the Issuer may be rescinded in whole or in part by the Issuer, and any Senior Obligation may be continued, and the Senior Obligations, or the liability of any
Subordinated Borrower or any Offering Proceeds Note Guarantor or any other party upon or for any part thereof, or any Guarantee therefor or right of offset with respect thereto, may, from time
to time, in whole or in part, be renewed, extended, modified, accelerated, compromised, waived, surrendered, or released by the Issuer, in each case without notice to or further assent by such
Subordinated Lender, which will remain bound under this Agreement and without impairing, abridging, releasing or affecting the subordination and other agreements provided for herein. 


        (d)   Each
Subordinated Lender waives any and all notice of the creation, renewal, extension or accrual of any of the Senior Obligations and notice of or proof of reliance by
the Issuer upon this Agreement. The Senior Obligations, and any of them, shall be deemed conclusively to have been created, contracted or incurred in reliance upon this Agreement, and all dealings
between any Subordinated Borrower and the Issuer shall be deemed to have been consummated in reliance upon this Agreement. Each Subordinated Lender acknowledges and agrees that the Issuer has relied
upon the subordination and other agreements provided for herein in consenting to this Agreement. Each Subordinated Lender waives notice of or proof of reliance on this Agreement and protest, demand
for payment and notice of default. 


        SECTION
2.4. Legend. Any and all instruments or records now or hereafter creating or evidencing the Subordinated Obligations, whether upon
refunding, extension, renewal, refinancing, replacement or otherwise, shall contain the following legend: 



        "Notwithstanding
anything contained herein to the contrary, neither the principal of nor the interest on, nor any other amounts payable in respect of, the indebtedness created or
evidenced by this instrument or record shall become due or be paid or payable, except to the extent permitted under the Subordination Agreement dated [insert date of this
agreement], among Level 3 Communications, Inc., [any additional Subordinated Lenders,] Level 3 Communications, LLC[, any additional Subordinated
Borrowers] and Level 3 Financing, Inc., which Subordination Agreement is incorporated herein with the same effect as if fully set forth herein." 




        SECTION
2.5. Transfer of Subordinated Obligations. Each Subordinated Lender agrees that it will not sell, assign, transfer or otherwise
dispose of all or any part of the Subordinated Obligations owed to it unless the Person to whom such sale, assignment, transfer or disposition is made shall acknowledge in writing (delivered to the
Issuer and the Purchasers) that it shall be bound by the terms of this 


D-4





 

Agreement
to the same extent as such Subordinated Lender, including the terms of this Section 2.5, as though it is a party hereto as of the date hereof. 


        SECTION
2.6. Obligations Hereunder Not Affected. (a) All rights and interests of the Issuer hereunder, and all agreements and
obligations of each Subordinated Lender hereunder, shall remain in full force and effect irrespective of: 



        (i)    any
lack of validity or enforceability of the Offering Proceeds Note, the Purchase Agreement or any document contemplated thereby; 


        (ii)   any
change in the time, manner or place of payment of, or in any other term of, all or any of the Senior Obligations, or any other amendment or waiver of or consent to
departure from the Offering Proceeds Note; 


        (iii)  any
release, amendment, waiver or other modification, whether in writing or by course of conduct or otherwise, of, or consent to departure from, any Offering Proceeds
Note Guarantee; or 


        (iv)  any
other circumstance that might otherwise constitute a defense available to, or a discharge of, any Subordinated Borrower in respect of its Senior Obligations or of
any Subordinated Lender in respect of this Agreement. 




        (b)   This
Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any payment of the Senior Obligations or any part thereof is rescinded
or must otherwise be returned by the Issuer upon the insolvency, bankruptcy or reorganization of any Subordinated Borrower or otherwise, all as though such payment had not been made. 


ARTICLE III  


 Representations and Warranties of the Subordinated Lenders  


        Each Subordinated Lender represents and warrants to the Issuer that: 


        (a)   It
is duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized. 


        (b)   The
execution, delivery and performance by it of this Agreement and the consummation of the transactions contemplated hereby are within its powers, have been duly
authorized by all necessary action on its part, require no action by or in respect of, or filing with, any court or governmental or regulatory body or agency (other than such as have been duly taken
or made) and do not contravene, or constitute a default under, any provision of applicable law or regulation or of its certificate of incorporation or by-laws (or other organizational
documents, as applicable) or of any material agreement, judgment, injunction, order, decree or other instrument binding upon it or any of its subsidiaries. 


        (c)   This
Agreement constitutes a valid and binding agreement of such Subordinated Lender, enforceable against such Subordinated Lender in accordance with its terms, subject
to the effect of applicable bankruptcy, insolvency or similar laws affecting creditors' rights generally and equitable principles of general applicability. 


ARTICLE IV  


 Miscellaneous  


        SECTION 4.1. Notices. All communications and notices hereunder shall be in writing and shall be mailed or
delivered and sent by fax and confirmed at 1025 Eldorado Boulevard, Broomfield, Colorado 80021, attention: General Counsel (Telecopy No. 720-888-5127; Telephone Confirm
720-888-2505), with 


D-5





 



a
copy in like manner to Citigroup Global Markets Inc., 388 Greenwich Street, New York, New York, 10013 (Telecopy No. 212-816-0949). 


        SECTION
4.2. Successors and Assigns. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed
to include the successors and assigns of such party. All representations, warranties, covenants, promises and agreements by or on behalf of each Subordinated Lender and each Subordinated Borrower that
are contained in this Agreement shall bind its successors and assigns and inure to the benefit of the Issuer and the successors and assigns of the Issuer. Each Subordinated Lender and each
Subordinated Borrower agrees that it shall not assign or delegate any of its obligations under this Agreement without the prior written consent of the Issuer, and any attempted assignment or
delegation without such consent shall be void and of no effect. 


        SECTION
4.3. Governing Law; Jurisdiction; Consent to Service of Process. (a) THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.


        (b)   Each
Subordinated Lender hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the Supreme Court of the State
of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out
of or relating to this Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right
that the Issuer may otherwise have to bring any action or proceeding relating to this Agreement against any Subordinated Lender or its properties in the courts of any jurisdiction. 


        (c)   Each
Subordinated Lender hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in paragraph (b) of this Section. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. 


        (d)   Each
Subordinated Lender hereby irrevocably consents to service of process in the manner provided for notices in Section 4.1 hereto. Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any other manner permitted by law. 



        SECTION
4.4. Waivers; Amendment. No failure or delay of the Issuer in exercising any right or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power by the Issuer preclude any other or further exercise thereof or the exercise of any other right or power. The rights and
remedies of the Issuer hereunder and instruments creating or securing its respective Senior Obligations are cumulative and are not exclusive of any other rights or remedies provided by law. Neither
this Agreement nor any provision hereof may be waived, amended or modified except (i) in accordance with Section 1020 of the Indenture and (ii) pursuant to an agreement or
agreements in writing entered into by the Issuer, each Subordinated Lender and each Subordinated Borrower intending to be bound thereby. 



        SECTION
4.5. Waiver of Claims. (a) To the maximum extent permitted by law, each Subordinated Lender waives any claim it might have
against the Issuer with respect to, or arising out of, any action 


D-6





 



or
failure to act or any error of judgment, negligence, or mistake or oversight whatsoever on the part of the Issuer or its directors, officers, employees, agents or affiliates with respect to any
exercise of rights or remedies under the Offering Proceeds Note. Neither the Issuer nor any of its respective directors, officers, employees, agents or affiliates shall be liable for failure to
demand, collect or realize upon any Offering Proceeds Note Guarantee or for any delay in doing so or shall be under any obligation to take any other action whatsoever with regard to the
Offering Proceeds Note or any part thereof. 


        (b)   Each
Subordinated Lender, for itself and on behalf of its successors and assigns, hereby waives any and all now existing or hereafter arising rights it may have to
require the Issuer to marshal assets for the benefit of such Subordinated Lender, or to otherwise direct the timing, order or manner of any enforcement of the Offering Proceeds Note. The Issuer is
under no duty or obligation, and each Subordinated Lender hereby waives any right it may have to compel the Issuer, to pursue any Offering Proceeds Note Guarantor or other Person who may be
liable for the Senior Obligations. 


        (c)   Each
Subordinated Lender hereby waives and releases all rights which a guarantor or surety with respect to the Senior Obligations could exercise. 


        (d)   Each
Subordinated Lender hereby waives any duty on the part of the Issuer to disclose to it any fact known or hereafter known by the Issuer relating to the operation or
financial condition of any Subordinated Borrower or any Offering Proceeds Note Guarantor, or their respective businesses. Each Subordinated Lender enters into this Agreement based solely upon
its independent knowledge of the applicable Subordinated Borrower's results of operations, financial condition and business and such Subordinated Lender assumes full responsibility for obtaining any
further or future information with respect to the applicable Subordinated Borrower or its results of operations, financial condition or business. 


        SECTION
4.6. Further Assurances. Each Subordinated Lender and each Subordinated Borrower, at its own expense and at any time from time to
time, upon the written request of the Issuer, will promptly and duly execute and deliver such further instruments and documents and take such further actions as the Issuer reasonably may request for
the purposes of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted. 



        SECTION
4.7. Provisions Define Relative Rights. This Agreement is intended solely for the purpose of defining the relative rights of the
Issuer on the one hand and the Subordinated Lenders and the
Subordinated Borrowers on the other, and no other Person shall have any right, benefit or other interest under this Agreement. 


        SECTION
4.8. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT
OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


        SECTION
4.9. Severability. In the event any one or more of the provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. The parties shall endeavor in
good faith negotiations to replace any invalid, illegal or 


D-7





 



unenforceable
provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions. 



        SECTION
4.10. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall constitute an original but all
of which, when taken together, shall constitute but one instrument. 


        SECTION
4.11. Headings. Article and Section headings used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement. 


        SECTION
4.12. Additional Subordinated Borrowers. Pursuant to clause (vi) of paragraph (b) of Section 1010 or
clause (iv) of paragraph (b) of Section 1011 of the Indenture, upon execution and delivery by, as applicable, any Restricted Subsidiary or Issuer Restricted
Subsidiary of an instrument in the form of Annex I attached hereto or otherwise in a form acceptable to the Issuer, such Restricted Subsidiary or Issuer Restricted Subsidiary, as applicable, shall
become a Subordinated Borrower hereunder with the same force and effect as if originally named as a Subordinated Borrower herein. The execution and delivery of any such instrument shall not require
the consent of any other Subordinated Borrower hereunder. The rights and obligations of each Subordinated Borrower herein shall remain in full force and effect notwithstanding the addition of any
Subordinated Borrower as a party to this Agreement. 


        SECTION
4.13. Additional Subordinated Lenders. Pursuant to clause (vi) of paragraph (b) of Section 1010 of the
Indenture or clause (iv) of paragraph (b) of Section 1011 of the Indenture or both such clauses, upon execution and delivery by any Sister Restricted Subsidiary of
an instrument in the form of Annex I attached hereto or otherwise in a form acceptable to the Issuer, such Sister Restricted Subsidiary shall become a Subordinated Lender hereunder with the same force
and effect as if originally named as a Subordinated Lender herein. The execution and delivery of any such instrument shall not require the consent of any other Subordinated Lender hereunder. The
rights and obligations of each Subordinated Lender herein shall remain in full force and effect notwithstanding the addition of any Subordinated Lender as a party to this Agreement. 


        SECTION
4.14. Subordination of Senior Obligations to Qualified Credit Facility. The Issuer, a Subordinated Borrower and the Subordinated
Lenders may enter into an agreement or arrangement that provides that the payment obligation on the Senior Obligations of such Subordinated Borrower be expressly subordinated in any bankruptcy,
liquidation or winding up proceeding of such Subordinated Borrower to the prior payment in full in cash of all obligations of such Subordinated Borrower under any Guarantee of, or obligation as
borrower under, any Qualified Credit Facility Incurred by Parent or a Restricted Subsidiary in accordance with clause (ii) of paragraph (b) of Section 1010 or
clause (ii) of paragraph (b) of Section 1011 of the Indenture; provided,  however, that (x) the terms of the subordination of
such Senior Obligations of such Subordinated Borrower, to any such Guarantee of or obligation
as borrower under a Qualified Credit Facility may not eliminate or otherwise adversely affect the subordination of the payment obligation on any other Debt of such Subordinated Borrower, to the
payment obligation of the Senior Obligations of such Subordinated Borrower, and (y) any Guarantee (other than a Guarantee of such Qualified Credit Facility) by such Subordinated Borrower of any
other Debt of Parent or any Sister Restricted Subsidiary also shall be expressly subordinated in any bankruptcy, liquidation or winding up proceeding of such Subordinated Borrower, to the prior
payment in full in cash of all obligations of such Subordinated Borrower under its Guarantee of such Qualified Credit Facility to at least the same extent and on the same terms and conditions as the
subordination provisions applicable to the Senior Obligations of such Subordinated Borrower. 


D-8





 

        IN
WITNESS WHEREOF, Level 3 LLC, as a Subordinated Borrower, Parent, as a Subordinated Lender and the Issuer have caused this Agreement to be duly executed by their respective authorized
representatives as of the day and year first above written. 



	

 	
 	

LEVEL 3 COMMUNICATIONS, LLC,
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

LEVEL 3 COMMUNICATIONS, INC.,
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

LEVEL 3 FINANCING, INC.,
	

 	
 	

By:	
 	

 Name:

Title:




D-9






Annex I to the

Subordinateion Agreement  




        SUPPLEMENT
NO. [    ] dated as of [                        ] to the Subordination Agreement dated as of
[                        ] (the "Subordination Agreement"), among LEVEL 3 COMMUNICATIONS, LLC ("Level 3 LLC"), each Restricted
Subsidiary or Issuer Restricted Subsidiary becoming a
party thereto pursuant to Section 4.12 thereof (each such Restricted Subsidiary or Issuer Restricted Subsidiary and Level 3 LLC, a "Subordinated Borrower"), LEVEL 3 COMMUNICATIONS, INC.
("Parent"), each Sister Restricted Subsidiary becoming a party thereto pursuant to Section 4.13 thereof (each such Sister Restricted Subsidiary and Parent, a "Subordinated Lender") and LEVEL 3
FINANCING, INC. (the "Issuer"). 





        Reference
is made to the Subordination Agreement. 


        Capitalized
terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Subordination Agreement. 


        Pursuant
to clause (vi) of paragraph (b) of Section 1010 or clause (iv) of paragraph (b) of Section 1011 of the Indenture,
as applicable, a Restricted Subsidiary or an Issuer Restricted Subsidiary is allowed to incur Debt from Parent or a Sister Restricted Subsidiary provided that (i) such Restricted Subsidiary or
Issuer Restricted Subsidiary, as applicable, is a Guarantor and an Offering Proceeds Note Guarantor and (ii) such Debt is expressly subordinated in any bankruptcy, liquidation or winding
up proceeding of such Restricted Subsidiary or Issuer Restricted Subsidiary, as applicable, to such Restricted Subsidiary's or Issuer Restricted Subsidiary's Offering Proceeds Note Guarantee, as
applicable. Section 4.12 of the Subordination Agreement provides that a Restricted Subsidiary or an Issuer Restricted Subsidiary may become a Subordinated Borrower under the Subordination
Agreement by execution and delivery of an instrument in the form of this Supplement. The undersigned Restricted Subsidiary or Issuer Restricted Subsidiary (the "New Subordinated Borrower") is
executing this Supplement to become a Subordinated Borrower under the Subordination Agreement in order to comply with the terms of the Indenture and as consideration for amounts previously advanced to
the Issuer under the Indenture. 


        Accordingly,
the New Subordinated Borrower agrees as follows: 


        In
accordance with Section 4.12 of the Subordination Agreement, the New Subordinated Borrower by its signature below becomes a Subordinated Borrower under the Subordination
Agreement with the same force and effect as if originally named therein as a Subordinated Borrower and the New Subordinated Borrower hereby agrees to all the terms and provisions of the Subordination
Agreement applicable to it as a Subordinated Borrower thereunder. Each reference to a "Subordinated Borrower" in the Subordination Agreement shall be deemed to include the New Subordinated Borrower.
The Subordination Agreement is hereby incorporated herein by reference. 


        The
New Subordinated Borrower represents and warrants to the Issuer that this Supplement has been duly authorized, executed and delivered by it and constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, moratorium or other laws affecting creditors' rights generally and subject to
general principles of equity regardless of whether considered in a proceeding in equity or at law. 


        This
Supplement may be executed in counterparts, each of which shall constitute an original, but all of which, when taken together, shall constitute a single contract. This Supplement
shall become effective when the Issuer shall have received counterparts of this Supplement that, when taken together, bear the signatures of the New Subordinated Borrower and the Issuer. Delivery of
an executed signature page to this Supplement by facsimile transmission shall be as effective as delivery of a manually executed counterpart of this Supplement. 


        Except
as expressly supplemented hereby and pursuant to any other supplement contemplated by Section 4.12 or 4.13 of the Subordination Agreement, the Subordination Agreement shall
remain in full force and effect. 





 



        THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.


        In
the event any one or more of the provisions contained in this Supplement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein shall not in any way be affected or impaired thereby. The parties shall endeavor in good faith negotiations to replace any invalid, illegal or unenforceable
provisions with valid
provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions. 


        All
communications and notices hereunder shall be in writing and given as provided in Section 4.1 of the Subordination Agreement. All communications and notices hereunder to the
New Subordinated Borrower shall be given to it at the address set forth under its signature below. 


2





 

        IN
WITNESS WHEREOF, the New Subordinated Borrower and the Issuer have duly executed this Supplement to the Subordination Agreement as of the day and year first above written. 



	

 	
 	

[NAME OF NEW SUBORDINATED BORROWER],
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

LEVEL 3 FINANCING, INC.,
	

 	
 	

By:	
 	

 Name:

Title:




3






Annex II to the

Subordination Agreement  




        SUPPLEMENT
NO. [    ] dated as of [                        ] to the Subordination Agreement dated as of
[                        ] (the "Subordination Agreement"), among LEVEL 3 COMMUNICATIONS, LLC ("Level 3 LLC"), each Restricted
Subsidiary or Issuer Restricted Subsidiary becoming a
party thereto pursuant to Section 4.12 thereof (each such Restricted Subsidiary or Issuer Restricted Subsidiary and Level 3 LLC, a "Subordinated Borrower"), LEVEL 3 COMMUNICATIONS, INC.
("Parent"), each Sister Restricted Subsidiary becoming a party thereto pursuant to Section 4.13 thereof (each such Sister Restricted Subsidiary and Parent, a "Subordinated Lender" and,
collectively, the "Subordinated Lenders") and LEVEL 3 FINANCING, INC. (the "Issuer"). 





        Reference
is made to the Subordination Agreement. 


        Capitalized
terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Subordination Agreement. 


        Pursuant
to clause (vi) of paragraph (b) of Section 1010 or clause (iv) of paragraph (b) of Section 1011 of the Indenture,
as applicable, a Restricted Subsidiary or an Issuer Restricted Subsidiary is allowed to incur Debt from Parent or a Sister Restricted Subsidiary provided that (i) such Restricted Subsidiary or
Issuer Restricted Subsidiary, as applicable, is a Guarantor and an Offering Proceeds Note Guarantor and (ii) such Debt is subordinated in any bankruptcy, liquidation or winding up
proceeding of such Restricted Subsidiary or Issuer Restricted Subsidiary, as applicable, to such Restricted Subsidiary's or Issuer Restricted Subsidiary's Offering Proceeds Note Guarantee.
Section 4.13 of the Subordination Agreement provides that a Sister Restricted Subsidiary may become a Subordinated Lender under the Subordination Agreement by execution and delivery of an
instrument in the form of this Supplement. The undersigned Sister Restricted Subsidiary (the "New Subordinated Lender") is executing this Supplement to become a Subordinated Lender under the
Subordination Agreement in order to comply with the terms of the Indenture and as consideration for amounts previously advanced to the Issuer under the Indenture. 


        Accordingly,
the New Subordinated Lender agrees as follows: 


        In
accordance with Section 4.13 of the Subordination Agreement, the New Subordinated Lender by its signature below becomes a Subordinated Lender under the Subordination Agreement
with the same force and effect as if originally named therein as a Subordinated Lender and the New Subordinated Lender hereby (a) agrees to all the terms and provisions of the Subordination
Agreement applicable to it as a Subordinated Lender thereunder and (b) represents and warrants that the representations and warranties made by it as a Subordinated Lender thereunder are true
and correct on and as of the date hereof. Each reference to a "Subordinated Lender" in the Subordination Agreement shall be deemed to include the New Subordinated Lender. The Subordination Agreement
is hereby incorporated herein by reference. 


        The
New Subordinated Lender represents and warrants to the Issuer that this Supplement has been duly authorized, executed and delivered by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, moratorium or other laws affecting creditors' rights generally and subject to general
principles of equity regardless of whether considered in a proceeding in equity or at law. 


        This
Supplement may be executed in counterparts, each of which shall constitute an original, but all of which, when taken together, shall constitute a single contract. This Supplement
shall become effective when the Issuer shall have received counterparts of this Supplement that, when taken together, bear the signatures of the New Subordinated Lender and the Issuer. Delivery of an
executed signature page to this Supplement by facsimile transmission shall be as effective as delivery of a manually executed counterpart of this Supplement. 





 



        Except
as expressly supplemented hereby and pursuant to any other supplement contemplated by Section 4.12 or 4.13 of the Subordination Agreement, the Subordination Agreement shall
remain in full force and effect. 


        THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.


        In
the event any one or more of the provisions contained in this Supplement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of
the remaining
provisions contained herein shall not in any way be affected or impaired thereby. The parties shall endeavor in good faith negotiations to replace any invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions. 


        All
communications and notices hereunder shall be in writing and given as provided in Section 4.1 of the Subordination Agreement. All communications and notices hereunder to the
New Subordinated Lender shall be given to it at the address set forth under its signature below. 


2





 

        IN
WITNESS WHEREOF, the New Subordinated Lender and the Issuer have duly executed this Supplement to the Subordination Agreement as of the day and year first above written. 



	

 	
 	

[NAME OF NEW SUBORDINATED LENDER]
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

LEVEL 3 FINANCING, INC.,
	

 	
 	

By:	
 	

 Name:

Title:




3






EXHIBIT E  




        OFFERING
PROCEEDS NOTE GUARANTEE AGREEMENT (this "Agreement") dated as of [            ], between [OFFERING PROCEEDS NOTE GUARANTOR]
(the "Offering Proceeds Note Guarantor"), a subsidiary of Level 3 Financing, Inc., and LEVEL 3 FINANCING, INC. (the "Issuer"). 




W I T N E S S E T H:  


        WHEREAS Level 3 Communications, LLC ("Level 3 LLC") has heretofore executed and delivered to Level 3 Financing, Inc. (the "Issuer") an intercompany demand
note in an initial principal amount equal to $500,000,000, as it may be amended from time to time pursuant to Sections 301 and 1020 of the Indenture (as defined below) (the "Offering Proceeds
Note"). 


        WHEREAS
the Issuer has heretofore executed and delivered to The Bank of New York, as trustee, an Indenture dated as of October 1, 2003 (the "Indenture"; capitalized terms used but
not defined herein having the meanings assigned thereto in the Indenture), providing for the issuance of its 10.75% Senior Notes due (the "Securities"); 


        WHEREAS
the Indenture permits the Offering Proceeds Note Guarantor to incur certain Debt provided, among other things, that such Offering Proceeds Note Guarantor execute and
deliver to the Issuer a Guarantee pursuant to which the Offering Proceeds Note Guarantor shall unconditionally guarantee all Level 3 LLC's obligations under the Offering Proceeds
Note pursuant to a Guarantee on the terms and conditions set forth herein; and 


        WHEREAS
the Guarantee contained in this Guarantee Agreement shall constitute an "Offering Proceeds Note Guarantee" for all purposes of the Indenture; 


        NOW
THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Offering Proceeds Note Guarantor
and the Issuer mutually covenant and agree for the equal and ratable benefit of the Issuer as follows: 


ARTICLE I  


 Offering Proceeds Note Guarantee  


        SECTION 1.01. Guarantees. Subject to a subordination agreement entered into pursuant to Section 1.03, the
Offering Proceeds Note Guarantor hereby unconditionally guarantees to the Issuer and its successors and assigns (a) the full and punctual payment in cash of all obligations of Level 3
LLC in respect of the Offering Proceeds Note, including the payment of principal, premium (if any), interest (including interest arising after the commencement of a bankruptcy or other proceeding,
whether or not such a claim is permitted in such proceeding) or any other amount payable thereunder (the "Obligations"). The Offering Proceeds Note Guarantor further agrees that the Obligations
may be extended or renewed, in whole or in part, without notice or further assent from the Offering Proceeds Note Guarantor and that the Offering Proceeds Note Guarantor will remain
bound under this Agreement notwithstanding any extension or renewal of the Obligations. 


        The
Offering Proceeds Note Guarantor waives presentation to, demand of, payment from and protest to Level 3 LLC of any of the Obligations and also waives notice of protest for
nonpayment. The Offering Proceeds Note Guarantor waives notice of any default under the Obligations. The obligations of the Offering Proceeds Note Guarantor hereunder shall not be
affected by (a) the failure of the Issuer to assert any claim or demand or to enforce any right or remedy against Level 3 LLC, any Offering Proceeds Note Guarantor or any other Person
under the Offering Proceeds Note or any other agreement or otherwise; (b) any extension or renewal of any obligation thereof; (c) any rescission, waiver, amendment or modification
of any of the terms or provisions of the Offering Proceeds Note, any Offering Proceeds Note Guarantee or any other agreement or (d) the release of any security held by the Issuer for the
Obligations, if any. 





 



        The
Offering Proceeds Note Guarantor further agrees that its Guarantee herein constitutes a Guarantee of payment, performance and compliance when due (and not a guarantee of
collection) and waives any right to require that any resort be had by the Issuer to any security held for payment of the Obligations. 


        Except
as expressly set forth in Section 1.03 or Section 2.08, the obligations of the Offering Proceeds Note Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination
for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by
reason of the invalidity, illegality or unenforceability of the Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of the Offering Proceeds
Note Guarantor herein shall not be discharged or impaired or otherwise affected by the failure of the Issuer to assert any claim or demand or to enforce any remedy under the Offering Proceeds
Note, any Offering Proceeds Note Guarantee or any other agreement, by any waiver or modification of any term thereof, by any default, failure or delay, willful or otherwise, in the performance
of the Obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Offering Proceeds
Note Guarantor or would otherwise operate as a discharge of the Offering Proceeds Note Guarantor as a matter of law or equity. 


        The
Offering Proceeds Note Guarantor further agrees that its Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or (premium, if any) interest on any Senior Obligation is rescinded or must otherwise be restored by the Issuer upon the bankruptcy or reorganization of Level 3 LLC or
otherwise. 


        In
furtherance of the foregoing and not in limitation of any other right which the Issuer has at law or in equity against the Offering Proceeds Note Guarantor by virtue hereof, upon the
failure of Level 3 LLC to pay the principal of (or premium, if any) or interest on the Obligations when and as the same shall become due or to perform or comply with any other Senior Obligation, the
Offering Proceeds Note Guarantor hereby promises to and will, upon receipt of written demand by the Issuer, forthwith pay, or cause to be paid, in cash, to the Issuer an amount equal to all
unpaid amounts in respect of the Obligations. 


        The
Offering Proceeds Note Guarantor agrees that it shall not be entitled to any right of subrogation in respect of any Obligations guaranteed hereby until payment in full in cash
of all Obligations. 


        The
Offering Proceeds Note Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys' fees) incurred by the Issuer in enforcing any rights under
this Article I. 


        SECTION
1.02. Contribution. The Offering Proceeds Note Guarantor (a "Contributing Party") agrees that, in the event a payment shall
be made by any other Offering Proceeds Note Guarantor under any other Offering Proceeds Note Guarantee (the "Claiming Offering Proceeds Note Guarantor"), the Contributing Party shall
indemnify the Claiming Offering Proceeds Note Guarantor in an amount equal to the amount of such payment multiplied by a fraction, the numerator of which shall be the net worth of the
Contributing Party (which shall be measured on the date hereof) and the denominator of which shall be the aggregate net worth of Level 3 LLC on the Issue Date and the Offering Proceeds
Note Guarantors on the respective dates of the Offering Proceeds Note Guarantee Agreements executed and delivered by such Offering Proceeds Note Guarantors. 


        SECTION
1.03. Subordination of Guarantees to Qualified Credit Facility. The Offering Proceeds Note Guarantor may enter into an
agreement or arrangement that provides that its payment obligation on the Obligations arising hereunder be expressly subordinated to the extent and under the conditions set forth in
Section 1308 of the Indenture. 


2





 


ARTICLE II  


 Miscellaneous  


        SECTION 2.01. Successors and Assigns. This Agreement shall be binding upon the Offering Proceeds
Note Guarantor and its successors and assigns and shall enure to the benefit of the successors and assigns of the Issuer and, in the event of any transfer or assignment of rights by the Issuer,
the rights and privileges conferred upon that party in the Offering Proceeds Note shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and
conditions of the Indenture. 


        SECTION
2.02. No Waiver. Neither a failure nor a delay on the part of the Issuer in exercising any right, power or privilege under this
Agreement or the Offering Proceeds Note shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or
privilege. The rights, remedies and benefits of the Issuer herein and therein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under
this Agreement or the Offering Proceeds Note at law, in equity, by statute or otherwise. 


        SECTION
2.03. Modification. Subject to Section 1020 of the Indenture, no modification, amendment or waiver of any provision of this
Agreement, nor the consent to any departure by the Offering Proceeds Note Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Issuer, and then
such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on the Offering Proceeds Note Guarantor in any case shall
entitle the Offering Proceeds Note Guarantor to any other or further notice or demand in the same, similar or other circumstances. 


        SECTION
2.04. Opinion of Counsel. Concurrently with the execution and delivery of this Agreement, the Offering Proceeds Note Guarantor
shall deliver to the Issuer an Opinion of Counsel to the effect that this Agreement has been duly authorized, executed and delivered by the Offering Proceeds Note Guarantor and that, subject to
the application of bankruptcy, insolvency, moratorium, fraudulent conveyance or transfer and other similar laws relating to creditors' rights generally and to the principles of equity, whether
considered in a proceeding at law or in equity, the Guarantee of the Offering Proceeds Note Guarantor is a legal, valid and binding obligation of the Offering Proceeds
Note Guarantor, enforceable against the Offering Proceeds Note Guarantor in accordance with its terms. 


        SECTION
2.05. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.



        SECTION
2.06. Counterparts. The parties may sign any number of copies of this Agreement. Each signed copy shall be an original, but all of
them together represent the same agreement. 


        SECTION
2.07. Effect of Headings. The Section headings herein are for convenience only and shall not effect the construction
thereof. 


        SECTION
2.08. Termination of Agreement and Release of Guarantee. This Agreement will be terminated and all obligations hereunder of the
Offering Proceeds Note Guarantor will be released under the circumstances and conditions set forth in Section 1303 of the Indenture. 


3





 

        IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written. 



	

 	
 	

[OFFERING PROCEEDS NOTE GUARANTOR],
	

 	
 	

By:	
 	

 Name:

Title:
	

 	
 	

LEVEL 3 FINANCING, INC.,
	

 	
 	

By:	
 	

 Name:

Title:




4









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Indenture Dated as of October 1, 2003