Document:

Exhibit
4.1

 

PRUDENTIAL
plc

Issuer

 

 

and

 

 

Wilmington
Trust Company

Senior
Trustee

 

 

 

SENIOR
INDENTURE

 

Dated as
of [•], 2004

 

 

 

Senior
Debt Securities

 

1

 

PRUDENTIAL
plc

 

Reconciliation and
tie showing the location in this Senior Indenture of the provisions inserted
pursuant to Sections 310 to 318(a), inclusive, of the Trust Indenture Act of
1939.

 

	
  Trust Indenture Act, Section

  	
   

  	
  Senior Indenture Section

  
	
  s310

  	
  (a)(1)

  	
   

  	
  6.09

  
	
   

  	
  (a)(2)

  	
   

  	
  6.09

  
	
   

  	
  (a)(3)

  	
   

  	
  Not applicable

  
	
   

  	
  (a)(4)

  	
   

  	
  Not applicable

  
	
   

  	
  (a)(5)

  	
   

  	
  6.09

  
	
   

  	
  (b)

  	
   

  	
  6.08 and 6.10

  
	
   

  	
  (c)

  	
   

  	
  Not applicable

  
	
  s311

  	
  (a)

  	
   

  	
  6.13

  
	
   

  	
  (b)

  	
   

  	
  6.13

  
	
   

  	
  (c)

  	
   

  	
  Not applicable

  
	
  s312

  	
  (a)

  	
   

  	
  7.01 and 7.02(a)

  
	
   

  	
  (b)

  	
   

  	
  7.02(b)

  
	
   

  	
  (c)

  	
   

  	
  7.02(c)

  
	
  s313

  	
  (a)

  	
   

  	
  7.03(a)

  
	
   

  	
  (b)

  	
   

  	
  7.03(a)

  
	
   

  	
  (c)

  	
   

  	
  7.03(a)

  
	
   

  	
  (d)

  	
   

  	
  7.03(b)

  
	
  s314

  	
  (a)

  	
   

  	
  7.04 and 10.04

  
	
   

  	
  (b)

  	
   

  	
  Not applicable

  
	
   

  	
  (c)

  	
   

  	
  1.02

  
	
   

  	
  (c)(1)

  	
   

  	
  1.02

  
	
   

  	
  (c)(2)

  	
   

  	
  1.02

  
	
   

  	
  (c)(3)

  	
   

  	
  1.01

  
	
   

  	
  (d)

  	
   

  	
  Not applicable

  
	
   

  	
  (e)

  	
   

  	
  1.02

  
	
  s315

  	
  (a)

  	
   

  	
  6.01(a)

  
	
   

  	
  (b)

  	
   

  	
  6.02 and 7.03(a)

  
	
   

  	
  (c)

  	
   

  	
  6.01(b)

  
	
   

  	
  (d)

  	
   

  	
  6.01(c)

  
	
   

  	
  (d)(1)

  	
   

  	
  6.01(c)(1)

  
	
   

  	
  (d)(2)

  	
   

  	
  6.01(c)(2)

  
	
   

  	
  (d)(3)

  	
   

  	
  6.01(c)(3)

  
	
   

  	
  (e)

  	
   

  	
  5.14

  
	
  s316

  	
  (a)(1)(A)

  	
   

  	
  5.02 and 5.12

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  5.13

  
	
   

  	
  (a)(2)

  	
   

  	
  Not applicable

  
	
   

  	
  (b)

  	
   

  	
  5.07

  
	
   

  	
  (c)

  	
   

  	
  1.04(a)

  
	
  s317

  	
  (a)(1)

  	
   

  	
  5.03

  
	
   

  	
  (a)(2)

  	
   

  	
  5.04

  
	
   

  	
  (b)

  	
   

  	
  10.03

  
	
  s318

  	
  (a)

  	
   

  	
  1.07

  

 

i

 

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

 

ii

 

TABLE
OF CONTENTS

 

	
  ARTICLE ONE

  
	
   

  	
   

  
	
  DEFINITIONS
  AND OTHER PROVISIONS OF GENERAL APPLICATION

  
	
   

  	
   

  
	
  SECTION 1.01. Definitions.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.02. Compliance Certificates and Opinions.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.03. Form of Documents Delivered to Senior Trustee.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.04. Acts of Holders; Communication by Holders with Other Holders.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.05. Notices, Etc., to Senior Trustee or Issuer.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.06. Notice to Holders; Waiver.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.07. Conflict with Trust Indenture Act.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.08. Effect of Headings and Table of Contents.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.09. Successors and Assigns.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.10. Separability Clause.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.11. Benefits of Senior Indenture.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.12. Governing Law.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.13. Non-Business Day.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.14. Immunity of Incorporators, Stockholders, Officers and Directors.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.15. Certain Matters Relating to Currencies.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.16. Language of Notices, Etc.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.17. Appointment of Agent for Service.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.18. Rules by the Senior Trustee and Agents.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.19. Successors; No Recourse Against Others.

  	
   

  
	
   

  	
   

  
	
  SECTION 1.20. Duplicate Originals.

  	
   

  

 

iii

 

	
  ARTICLE TWO

  
	
   

  	
   

  
	
  SECURITY FORMS

  
	
   

  	
   

  
	
  SECTION 2.01. Forms of Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 2.02. Form of Senior Trustee’s Certificate of Authentication.

  	
   

  
	
   

  	
   

  
	
  SECTION 2.03. Securities in Global Form.

  	
   

  
	
   

  	
   

  
	
  ARTICLE THREE

  
	
   

  	
   

  
	
  THE SECURITIES

  
	
   

  	
   

  
	
  SECTION 3.01. Title; Payment and Terms

  	
   

  
	
   

  	
   

  
	
  SECTION 3.02. Denominations and Currencies.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.03. Execution, Authentication, Delivery and Dating.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.04. Temporary Securities and Exchange of Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.05. Registration, Registration of Transfer and Exchange.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.07. Payment of Interest; Interest Rights Preserved.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.08. Persons Deemed Owners

  	
   

  
	
   

  	
   

  
	
  SECTION 3.09. Cancellation.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.10. Computation of Interest.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.11. Currency and Manner of Payments in Respect of Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.12. Currency Determination Agent.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.13. Common Code, CUSIP or ISIN Numbers.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.14. Authenticating Agents.

  	
   

  
	
   

  	
   

  
	
  ARTICLE FOUR

  
	
   

  	
   

  
	
  SATISFACTION AND DISCHARGE

  
	
   

  	
   

  
	
  SECTION 4.01. Satisfaction and Discharge of Securities of any Series.

  	
   

  
	
   

  	
   

  
	
  SECTION 4.02. Application of Trust Money.

  	
   

  
	
   

  	
   

  
	
  SECTION 4.03. Satisfaction and Discharge of Senior Indenture.

  	
   

  
	
   

  	
   

  
	
  SECTION 4.04. Reinstatement.

  	
   

  

 

iv

 

	
  ARTICLE FIVE

  
	
   

  
	
  REMEDIES

  
	
   

  	
   

  
	
  SECTION 5.01. Events of Default.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.02. Acceleration of Maturity; Rescission and Annulment.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by Senior
  Trustee

  	
   

  
	
   

  	
   

  
	
  SECTION 5.04. Senior Trustee May File Proofs of Claim.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.05. Senior Trustee May Enforce Claims Without Possession of Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.06. Application of Money Collected.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.07. Limitation on Suits.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.08. Unconditional Right of Holders to Receive Principal (and Premium, if
  any) and Interest, if any.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.09. Restoration of Rights and Remedies

  	
   

  
	
   

  	
   

  
	
  SECTION 5.10. Rights and Remedies Cumulative.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.11. Delay or Omission Not Waiver.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.12. Control by Holders.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.13. Waiver of Past Defaults.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.14. Undertaking for Costs.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.15. Waiver of Stay or Extension Laws.

  	
   

  
	
   

  	
   

  
	
  SECTION 5.16. Judgment Currency.

  	
   

  
	
   

  	
   

  
	
  ARTICLE SIX

  
	
   

  
	
  THE SENIOR TRUSTEE

  
	
   

  	
   

  
	
  SECTION 6.01. Certain Duties and Responsibilities.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.02. Notice of Default.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.03. Certain Rights of Senior Trustee.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.04. Not Responsible for Recitals or Issuance of Securities.

  	
   

  

 

v

 

	
  SECTION 6.05. May Hold Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.06. Money Held in Trust.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.07. Compensation and Reimbursement.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.08. Disqualification; Conflicting Interests.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.09. Corporate Senior Trustee Required; Different Senior Trustees for
  Different Series; Eligibility.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.10. Resignation and Removal; Appointment of Successor.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.11. Acceptance of Appointment by Successor.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.12. Merger, Conversion, Consolidation or Succession to Business.

  	
   

  
	
   

  	
   

  
	
  SECTION 6.13. Preferential Collection of Claims Against the Issuer.

  	
   

  
	
   

  	
   

  
	
  ARTICLE SEVEN

  
	
   

  
	
  HOLDERS’ LISTS AND REPORTS BY SENIOR
  TRUSTEE AND ISSUER

  
	
   

  	
   

  
	
  SECTION 7.01. Issuer to Furnish Senior Trustee Names and Addresses of Holders.

  	
   

  
	
   

  	
   

  
	
  SECTION 7.02. Preservation of Information; Communications to Holders.

  	
   

  
	
   

  	
   

  
	
  SECTION 7.03. Reports by Senior Trustee.

  	
   

  
	
   

  	
   

  
	
  SECTION 7.04. Reports by Issuer.

  	
   

  
	
   

  	
   

  
	
  ARTICLE EIGHT

  
	
   

  
	
  CONSOLIDATION, MERGER, CONVEYANCE OR
  TRANSFER

  
	
   

  	
   

  
	
  SECTION 8.01. Issuer May Consolidate, Etc., Only on Certain Terms.

  	
   

  
	
   

  	
   

  
	
  SECTION 8.02. Successor Corporation Substituted.

  	
   

  
	
   

  	
   

  
	
  ARTICLE NINE

  
	
   

  
	
  SUPPLEMENTAL INDENTURES

  
	
   

  	
   

  
	
  SECTION 9.01. Supplemental Senior Indentures Without Consent of Holders.

  	
   

  
	
   

  	
   

  
	
  SECTION 9.02. Supplemental Senior Indentures With Consent of Holders.

  	
   

  
	
   

  	
   

  
	
  SECTION 9.03. Execution of Supplemental Senior Indentures.

  	
   

  
	
   

  	
   

  
	
  SECTION 9.04. Effect of Supplemental Senior Indentures.

  	
   

  

 

vi

 

	
  SECTION 9.05. Conformity With Trust Indenture Act.

  	
   

  
	
   

  	
   

  
	
  SECTION 9.06. Reference in Securities to Supplemental Senior Indentures.

  	
   

  
	
   

  	
   

  
	
  ARTICLE TEN

  
	
   

  
	
  COVENANTS

  
	
   

  	
   

  
	
  SECTION 10.01. Payment of Principal (and Premium, if any) and
  Interest, if any.

  	
   

  
	
   

  	
   

  
	
  SECTION 10.02. Maintenance of Office or Agency.

  	
   

  
	
   

  	
   

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

  	
   

  
	
   

  	
   

  
	
  SECTION 10.04. Statements as to Compliance.

  	
   

  
	
   

  	
   

  
	
  SECTION 10.05. Corporate Existence.

  	
   

  
	
   

  	
   

  
	
  SECTION 10.06. Negative Pledge.

  	
   

  
	
   

  	
   

  
	
  SECTION 10.07. Waiver of Certain Covenants.

  	
   

  
	
   

  	
   

  
	
  SECTION 10.08. Payment of Additional Amounts.

  	
   

  
	
   

  	
   

  
	
  SECTION 10.09. Calculation of Original Issue Discount.

  	
   

  
	
   

  	
   

  
	
  ARTICLE ELEVEN

  
	
   

  
	
  REDEMPTION OF SECURITIES

  
	
   

  	
   

  
	
  SECTION 11.01. Applicability of This Article.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.02. Election to Redeem; Notice to Senior Trustee.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.03. Selection of Securities to Be Redeemed.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.04. Notice of Redemption.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.05. Deposit of Redemption Price.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.06. Securities Payable on Redemption Date.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.07. Securities Redeemed in Part.

  	
   

  
	
   

  	
   

  
	
  SECTION 11.08. Tax Redemption.

  	
   

  
	
   

  	
   

  
	
  ARTICLE TWELVE

  
	
   

  
	
  SINKING FUNDS

  
	
   

  	
   

  
	
  SECTION 12.01. Applicability of This Article.

  	
   

  

 

vii

 

	
  SECTION 12.02. Satisfaction of Sinking Fund Payments With
  Securities.

  	
   

  
	
   

  	
   

  
	
  SECTION 12.03. Redemption of Securities for Sinking Fund.

  	
   

  

 

viii

 

PRUDENTIAL
SENIOR INDENTURE

 

This is a SENIOR
INDENTURE dated as of [•], 2004, among Prudential plc, a
public limited company duly organized and existing under the laws of England
and Wales and having its principal office at Laurence Pountney Hill, London
EC4R 0HH, England (hereinafter called the “Issuer”), and Wilmington Trust
Company, a banking corporation duly organized and existing under the laws of
Delaware and having its Corporate Trust Office at Rodney Square North, 1100
North Market Street, Wilmington, Delaware 19890 USA, as Senior Trustee
(hereinafter called the “Senior Trustee”).

 

RECITALS
OF THE ISSUER

 

The Issuer deems
it necessary to issue from time to time for its lawful purposes securities in
registered form (hereinafter called the “Securities”) evidencing its unsecured
indebtedness and has duly authorized the execution and delivery of this Senior
Indenture to provide for the issuance from time to time of the Securities,
unlimited as to principal amount, to have such titles, to bear such rates of
interest, to mature at such time or times and to have such other provisions as
shall be established as hereinafter provided.

 

All things
necessary to make this Senior Indenture a valid agreement of the Issuer, in
accordance with its terms, have been done, and the Issuer proposes to do all
things necessary to make the Securities, when executed by the Issuer and
authenticated and delivered by the Senior Trustee hereunder and duly issued by
the Issuer, the valid obligations of the Issuer as hereinafter provided.

 

NOW
THEREFORE, THIS SENIOR 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 1.01.  Definitions.

 

For all purposes
of this Senior Indenture and all Securities issued hereunder, except as
otherwise expressly provided herein, in one or more indentures supplemental
hereto or in an Officers’ Certificate pursuant to Section 3.01 or unless
the context otherwise requires:

 

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

 

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

 

1

 

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

 

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

 

Certain terms,
used principally in Article Three and Article Six, are defined in
those Articles.

 

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

 

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

 

“Auditors” means the auditors for the time being of the
Issuer, or if there shall be joint auditors of the Issuer, any one or more of
such joint auditors.

 

“Authenticating Agent” means any Person authorized to
authenticate and deliver Securities in the name of and as the agent of, the
Senior Trustee for the Securities of any series pursuant to Section 3.14.

 

“Bankruptcy Law” means any bankruptcy, insolvency,
reorganization or other similar law of the United States or any State thereof,
England or Wales or any other applicable country or jurisdiction.

 

“Board of Directors” means the board of directors of the
Issuer or any duly authorized committee of that board or any director or
directors and/or officer or officers of the Issuer to whom that board or
committee shall have duly delegated its authority.

 

“Board Resolution” means (i) a copy of a resolution certified
by a director, the Secretary or a Deputy or Assistant Secretary of the Issuer
to have been duly adopted by the Board of Directors or an authorized committee
thereof and to be in full force and effect on the date of such certification,
or (ii) a certificate signed by the director or directors and/or officer or
officers to whom the Board of Directors of the Issuer shall have duly delegated
its authority, and, in each case, delivered to the Senior Trustee for the
Securities of any series.

 

“Business Day”, when used with respect to any particular
Place of Payment, means, unless otherwise specified in the Securities of a
series, each day, other than a Saturday or Sunday, which is not a day on which
commercial banking institutions in The City of New 

 

2

 

York or in London, England or in the applicable Place of Payment, or,
in respect of any payment to be made in a Foreign Currency, in the principal
financial center of the country issuing such Foreign Currency, are authorized
or required by law, regulation or executive order to close, and shall otherwise
mean each day, other than a Saturday or Sunday, which is not a day on which
banking institutions, at the place where any specified act pursuant to this
Senior Indenture is to occur, are authorized or required by law, regulation or
executive order to close.

 

“Certificate of a Firm of Independent Public Accountants”
means a certificate signed by any firm of independent public accountants of
nationally recognized standing in the country of organization of the Issuer
selected by the Issuer which may include the Auditors of the Issuer.

 

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

 

“Component Currency” has the meaning specified in
Section 3.11(h).

 

“Conversion Date” has the meaning specified in
Section 3.11(d).

 

“Conversion Event” means the unavailability of any Foreign
Currency or currency unit due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer.

 

“Corporate Trust Office” means the office of the Senior
Trustee for Securities of any series at which at any particular time its
corporate trust business shall be principally administered, which office of
Wilmington Trust Company, at the date of the execution of this Senior
Indenture, is located at Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890 USA.

 

“corporation” includes corporations, associations, companies
and business trusts.

 

“Currency Determination Agent”, with respect to Securities of
any series, means, unless otherwise specified in the Securities of a series, a
New York Clearing House bank designated pursuant to Section 3.01 or
Section 3.12.

 

“Currency Determination Agent’s Certificate” means a
certificate or facsimile thereof setting forth (i) the applicable Market
Exchange Rate and (ii) the Dollar, Foreign Currency or currency unit amounts of
principal (and premium, if any) and interest, if any (on an aggregate basis and
on the basis of a Security having the lowest denomination principal amount
determined in accordance with Section 3.02 in the relevant currency or
currency unit), payable with respect to a Security of any series on the basis
of such Market Exchange Rate, signed by the Currency Determination Agent.

 

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

 

3

 

“Depositary” means, with respect to the Securities of any
series issuable or issued in the form of a global Security, the Person
designated as Depositary by the Issuer pursuant to Section 3.01 until a
successor Depositary shall have become such pursuant to the applicable
provisions of this Senior Indenture, and thereafter “Depositary” shall mean or
include each Person who is then a Depositary hereunder, and if at any time
there is more than one such Person, “Depositary” as used with respect to the
Securities of any such series shall mean each Depositary with respect to the
Securities of that series.

 

“Directives” means the Directive 98/78/EC of the European
Union and the Directive 2002/87/EC of the European Union.

 

“Discounted Security” means any Security which provides for
an amount (excluding any amounts attributable to accrued but unpaid interest
thereon) less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to
Section 5.02.

 

“Dollar Equivalent of the Currency Unit” has the meaning
specified in Section 3.11(g).

 

“Dollar Equivalent of the Foreign Currency” has the meaning
specified in Section 3.11(f).

 

“Dollars” and the sign “$” mean the
currency of the United States that as at the time of payment is legal tender
for the payment of public and private debts.

 

“Election Date” has the meaning specified in
Section 3.11(h).

 

“euro” means the single currency of the participating member
states of the European Union that adopted the euro as their lawful currency
pursuant to the Treaty establishing the European Union (as amended from time to
time), and “participating member states” means those member states of the
European Union from time to time which adopt a single, shared currency in the
Third Stage, as defined and identified in European Union legislation.

 

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

 

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

 

“Exchange Rate Officers’ Certificate” means a certificate or
facsimile thereof setting forth (i) the applicable Market Exchange Rate and
(ii) the Dollar, Foreign Currency or currency unit amounts of principal (and
premium, if any) and interest, if any (on an aggregate basis and on the basis
of a Security having the lowest denomination principal amount determined in
accordance with Section 3.02 in the relevant currency or currency unit),
payable with respect to a Security of any series on the basis of such Market
Exchange Rate, signed by the finance director or treasurer of the Issuer.

 

“Foreign Currency” means a currency issued and actively
maintained as a country’s or countries’ recognized unit of domestic exchange by
the government of any country other than the United States.

 

4

 

“Holder”, when used with respect to any Security, means the
Person in whose name a Security is registered in the Security Register.

 

“Indebtedness for Moneys Borrowed” means the principal amount
of (i) all moneys borrowed and (ii) all debentures (together in each case with
any fixed or minimum premium payable on final redemption or repayment) which
neither the Issuer nor any Subsidiary beneficially owns for the time being.

 

“interest”, when used with respect to a Discounted Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.

 

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

 

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

 

“Issuer Request” and “Issuer Order”
mean, respectively, a written request or order (a) signed in the name of the
Issuer by (i) any two of its chairman of the board, deputy chairman of the
board, group chief executive officer, treasurer, group finance director or
director group finance and risk, (ii) any one of the foregoing Persons together
with any group secretary or deputy group secretary of the Issuer, or (iii) any
two Persons designated by the Issuer in an Issuer Order previously delivered to
the Senior Trustee for Securities of any series and (b) delivered to the Senior
Trustee and/or Principal Paying Agent, as the case may be, for Securities of
any series in accordance with the provisions of this Senior Indenture.

 

“Market Exchange Rate” means, unless otherwise specified in
the Securities of a series, (i) for any conversion involving a currency unit on
the one hand and Dollars or any Foreign Currency on the other, the exchange
rate between the relevant currency unit and Dollars or such Foreign Currency
calculated by the method specified pursuant to Section 3.01 for the Securities
of the relevant series and (ii) for any conversion of Dollars into any Foreign
Currency or for any conversion of one Foreign Currency into Dollars or another
Foreign Currency, the spot rate at noon local time in the relevant market at
which, in accordance with normal banking procedures, the Dollars or Foreign
Currency into which conversion is being made could be purchased with the
Dollars or Foreign Currency from which conversion is being made from major
banks located in either New York City, New York, London, England, or any other
principal market for Dollars or such Foreign Currency, in each case determined
by the Issuer or the Currency Determination Agent.  In the event of the unavailability of any of
the exchange rates provided for in the foregoing clauses (i) and (ii), the
Issuer or the Currency Determination Agent shall use, in its sole discretion
and without liability on its part, such quotation of the Federal Reserve Bank
of New York as of the most recent available date, or quotations from one or
more major banks in New York City, New York, London, England, or other
principal market for such currency or currency unit in question, or such other
quotations as the Issuer or the Currency Determination Agent shall deem
appropriate.  Unless otherwise specified
by the Issuer or the Currency Determination Agent, if there is more than one
market for dealing in any currency or currency unit by reason of foreign
exchange regulations or otherwise, the market to be used in respect of such
currency or currency unit 

 

5

 

shall be that upon which a nonresident issuer of securities designated
in such currency or currency unit would purchase such currency or currency unit
in order to make payments in respect of such securities.  For purposes of this definition, a
“nonresident issuer” shall mean an issuer that is not a resident of the country
or countries that issue such currency or whose currencies are included in such
currency unit.

 

“Maturity”, when used with respect to any Security, means the
date on which the principal (or, if the context so requires, lesser amount in
the case of Discounted Securities) of (or premium, if any, on) that Security
becomes due and payable as therein or herein provided, whether at the Stated Maturity
or by declaration of acceleration, call for redemption, request for redemption,
repayment at the option of the Holder, pursuant to any sinking fund provisions
or otherwise.

 

“Officers’ Certificate” means a certificate of the Issuer
signed by (i) any two of its chairman of the board, deputy chairman of the
board, group chief executive officer, treasurer, group finance director or
director group finance and risk or (ii) any one of the foregoing Persons
together with any group secretary or deputy group secretary of the Issuer, and
delivered in form and substance reasonably acceptable to the Senior Trustee
and/or Principal Paying Agent, as the case may be, for the Securities of any
series in accordance with the provisions of this Senior Indenture.

 

“Opinion of Counsel” means a written opinion of outside legal
counsel in form and substance reasonably acceptable to the Senior Trustee for
the Securities of any series and who may be regular outside counsel to the
Issuer.

 

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

 

(1)                                  Securities
which have been cancelled by the Senior Trustee for such Securities or
delivered to such Senior Trustee for cancellation;

 

(2)                                  Securities
or portions thereof for whose payment or redemption money in the necessary
amount and in the required currency or currency unit has been deposited with or
to the order of the Senior Trustee for such Securities or any Paying Agent
(other than the Issuer or any other obligor upon the Securities) in trust or
set aside and segregated in trust by the Issuer or any other obligor upon the
Securities (if the Issuer or any other obligor upon the Securities shall act as
its own Paying Agent) for the Holders of such Securities; provided, however,
that, if such Securities or portions thereof are to be redeemed, notice of such
redemption has been duly given pursuant to this Senior Indenture, or provision
therefor satisfactory to such Senior Trustee has been made unless, in each
case, there is a default in such payment or redemption; and

 

(3)                                  Securities
which have been paid pursuant to Section 3.06 or in exchange for or in
lieu of which other Securities have been authenticated and delivered pursuant
to this Senior Indenture, other than any such Securities in respect of which
there shall have been presented proof reasonably satisfactory to the Issuer and
the Senior Trustee for such Securities that any such Securities are held by
bona fide holders in due course;

 

6

 

provided,
however, that in determining whether the Holders of the
requisite aggregate principal amount of Outstanding Securities have given any
request, demand, authorization, direction, notice, consent or waiver or taken
any other action hereunder (a) 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, (i)
in determining whether the Senior Trustee for such Securities shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver or action, only Securities which a Responsible Officer
of such Senior Trustee actually knows to be so owned shall be so disregarded
and (ii) Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of such
Senior 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 of such other obligor and (b) the principal
amount of a Discounted Security that shall be deemed to be Outstanding for such
purposes shall be equal to the amount of the principal thereof that would be
due and payable as of the date of such determination upon a declaration of
acceleration pursuant to Section 5.02.

 

“Paying Agent” means any Person authorized by the Issuer to
pay the principal of (and premium, if any, on) or interest, if any, on, and any
additional amounts in respect of, any Securities on behalf of the Issuer and
shall include the Senior Trustee.

 

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

 

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

 

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

 

“Principal Subsidiary” means The Prudential Assurance Company
Limited, for so long as such company shall remain a Subsidiary.

 

“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 Senior Indenture.

 

“Redemption Price”, when used with respect to any Security to
be redeemed, means, unless otherwise specified in the Securities of a series,
the aggregate of the amounts payable on redemption being the principal amount
plus accrued interest.

 

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

 

7

 

“Relevant Indebtedness” means any Indebtedness for Moneys
Borrowed (other than indebtedness in the form of Sterling Debenture Stock or
indebtedness which has a stated maturity not exceeding one year) which is in
the form of, or represented or evidenced by, bonds, notes, debentures, loan
stock or other securities which, with the Issuer’s agreement or the agreement
of any relevant Subsidiary, as the case may be, are quoted, listed, dealt in or
traded on a stock exchange or over the counter or other recognized securities
market (whether or not distributed by way of private placement) excluding any
Indebtedness for Moneys Borrowed incurred to acquire an asset from outside the
Prudential plc group in respect of which the person to whom such indebtedness
is owed has no recourse whatsoever to Prudential plc or the Principal
Subsidiary, as the case may be, for repayment other than recourse for amounts
limited to the cash flow or net cash flow (other than historic cash flow or
historic net cash flow) from such asset.

 

“Responsible Officer”, when used with respect to the Senior
Trustee for any series of Securities, means any officer of such Senior Trustee
assigned to administer its corporate trust matters or to whom any corporate
trust matter is referred because of his knowledge of and familiarity with the
particular subject.

 

“Securities” means securities in registered form evidencing
unsecured indebtedness of the Issuer authenticated and delivered under this
Senior Indenture and registered in the Security Register.

 

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

 

“Senior Indenture” means this instrument 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 and, unless
the context otherwise requires, shall include the terms of a particular series
of Securities established as contemplated by Section 3.01.

 

“Senior Trustee” means the Person named as the “Senior
Trustee” in the first paragraph of this instrument and, subject to the
provisions of Article Six hereof, shall also include its successors and
assigns as Senior Trustee hereunder. If there shall be at one time more than
one Senior Trustee hereunder, “Senior Trustee” shall mean each such Senior
Trustee and shall apply to each such Senior Trustee only with respect to those
series of Securities with respect to which it is serving as Senior Trustee.

 

A “series” of Securities means all Securities denoted as part
of the same series authorized by or pursuant to a particular Board Resolution
or a particular indenture supplemental hereto.

 

“Special Record Date” for the payment of any Defaulted
Interest on the Securities of any series means a date fixed by the Issuer for
such series pursuant to Section 3.07.

 

“Specified Amount” has the meaning specified in
Section 3.11(h).

 

“Stated Maturity”, when used with respect to any Security or
any installment of principal thereof (or premium, if any, thereon) or interest,
if any, thereon, means the date 

 

8

 

specified in such Security as the fixed date on which the principal of
such Security (or premium, if any, thereon) or such installment of principal
(or premium, if any, thereon) or interest is due and payable.

 

“Sterling Debenture Stock” means secured loan stock in registered
form or to be in registered form, listed on the London Stock Exchange,
denominated in or payable in Sterling and initially primarily distributed to
investors in the United Kingdom.

 

“Stock Exchange”, unless specified otherwise with respect to
any particular series of Securities, means any stock exchange or securities
association upon which any Securities of that series are duly listed.

 

“Sterling” and the sign “£” mean United
Kingdom Pounds Sterling.

 

“Subsidiary” means a subsidiary undertaking of the Issuer,
within the meaning of Section 258 of the Companies Act 1985 of Great
Britain as amended by the Companies Act 1989 of Great Britain.

 

“Tax Event” means, with respect to a series of Securities, a
determination by the Issuer that, in making any interest payments in respect of
such Securities, the Issuer has paid or will or would on the next Interest
Payment Date be required to pay additional amounts, as required by
Section 10.08.

 

“Trust Indenture Act” means the U.S. Trust Indenture Act of
1939, as amended by the Trust Indenture Reform Act of 1990, as in force at the
date as of which this instrument was executed, except as provided in
Section 9.05.

 

“United Kingdom” and “U.K.” mean The
United Kingdom of Great Britain and Northern Ireland.

 

“United States” and “U.S.” mean,
unless otherwise specified with respect to the Securities of a series pursuant
to Section 3.01, the United States of America (including the States and
the District of Columbia), its territories, its “possessions” (which include at
the date of this Senior Indenture Puerto Rico, the U.S. Virgin Islands, Guam,
American Samoa, Wake Island and the Northern Mariana Islands) and other areas
subject to its jurisdiction.

 

“U.S. Government Obligations” means non-callable (i) direct
obligations (or certificates representing an ownership interest in such
obligations) of the United States for which its full faith and credit are
pledged or (ii) obligations of a Person controlled or supervised by, and acting
as an agency or instrumentality of, the United States, the timely payment of
which is unconditionally guaranteed as a full faith and credit obligation of
the United States.

 

“Valuation Date” has the meaning specified in
Section 3.11(c).

 

“Yield to Maturity”, when used with respect to any Discounted
Security, means the yield to maturity, if any, set forth in such Discounted
Security.

 

9

 

SECTION 1.02.  Compliance
Certificates and Opinions.

 

Upon any
application or request by the Issuer to the Senior Trustee for any series of
Securities to take any action under any provision of this Senior Indenture, the
Issuer shall furnish to such Senior Trustee an Officers’ Certificate stating
that all conditions precedent, if any, provided for in this Senior Indenture
relating to the proposed action have been complied with, and an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with, provided 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 Senior Indenture relating to
such particular application or request, the requirements hereof and thereof may
be satisfied by the same documents as contemplated by Section 1.03 such
that no duplicate certificate or opinion need be furnished.

 

Every certificate
(other than certificates provided pursuant to Section 10.04) or opinion
with respect to compliance with a condition or covenant provided for in this
Senior Indenture shall include the following (or such other statements or
information as the Senior Trustee may reasonably request):

 

(1)                                  a
statement that each individual signing such certificate or opinion has read
such condition or covenant 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 condition or covenant has been
complied with; and

 

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

 

SECTION 1.03.  Form
of Documents Delivered to Senior Trustee.

 

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

 

Any certificate or
opinion of an officer of the Issuer 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 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 stating that the information with respect to
such factual matters is in the possession of the Issuer, 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.

 

10

 

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

 

SECTION 1.04.  Acts
of Holders; Communication by Holders with Other Holders.

 

(a)                                  Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Senior Indenture to be given or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in
writing. Except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Senior Trustee for the appropriate series of Securities 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, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Senior Indenture and
(subject to Section 6.01) conclusive in favor of the Senior Trustee for
the appropriate series of Securities, the Issuer and any agent of such Senior
Trustee or the Issuer, if made in the manner provided in this Section.

 

The Issuer may set
at its discretion a record date for purposes of determining the identity of
Holders of Securities entitled to vote or consent to any action by vote or
consent authorized or permitted under this Senior Indenture, but the Issuer
shall have no obligation to do so.  If
not set by the Issuer prior to the first solicitation of Holders of Securities
of such series made by any Person in respect of any such action, or, in the
case of any such vote, prior to such vote, the record date for any such action
or vote shall be the 30th day prior to the first solicitation of such vote or
consent or, if later, the date of the most recent list of Holders furnished to
the Senior Trustee prior to such solicitation pursuant to Section 7.01. Upon
the fixing of such a record date, those persons who were Holders of Securities
at such record date (or their duly designated proxies), and only those persons,
shall be entitled with respect to such Securities to take such action by vote
or consent or to revoke any vote or consent previously given, whether or not
such persons continue to be Holders after such record date.

 

(b)                                 Subject
to Section 6.03, 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 the certificate of any notary public, commissioner for oaths or
other officer authorized by law to take acknowledgements of deeds, certifying
that the individual signing such instrument or writing acknowledged to him the
execution thereof. Where such execution is by an officer of a corporation or
association or a member of a partnership, or an official of a public or
governmental body, on behalf of such corporation, association, partnership or
public or governmental body or by a fiduciary, such certificate or affidavit
shall also constitute sufficient proof of this authority.

 

(c)                                  Subject
to Section 6.03, the fact and date of the execution by any Person of any
such instrument or writing, or the authority of the Person executing the same,
may also be proved in any other manner which the Senior Trustee for the
appropriate series of Securities deems sufficient.

 

11

 

(d)                                 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.

 

(e)                                  In
determining whether the Holders of the requisite aggregate principal amount of
Outstanding Securities have given any request, demand, authorization,
direction, notice, consent or waiver under this Senior Indenture, the principal
amount of a Discounted Security that may be counted in making such
determination and that shall be deemed to be Outstanding for such purposes
shall be equal to the amount of the principal thereof that would be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.02 at the time the taking of such action by the Holders of such
requisite aggregate principal amount is evidenced to the Senior Trustee for
such Securities.

 

(f)                                    Any
request, demand, authorization, direction, notice, consent, waiver or other
action by 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 Senior Trustee for such
Securities, the Security Registrar, any Paying Agent or the Issuer in reliance
thereon, whether or not notation of such action is made upon such Security.

 

SECTION 1.05.  Notices,
Etc., to Senior Trustee or Issuer.

 

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

 

(1)                                  the
Senior Trustee for a series of Securities 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 such Senior Trustee at its Corporate Trust Office,
“Attention: Corporate Trust Administration”; or

 

(2)                                  the
Issuer by the Senior Trustee or any Holder shall be sufficient for every
purpose hereunder (except as provided in clause (3) of Section 5.01) if
(a) addressed to Prudential plc, “Attention: Group Secretarial” and (b) in
writing and mailed, first class postage prepaid, or hand delivered to the
Issuer addressed to it at the address of its principal office specified in the
first paragraph of this Senior Indenture or at any other address previously
furnished in writing to such Senior Trustee by the Issuer, or if sent by
facsimile transmission addressed to the Issuer at facsimile number + 44 (0)20
7548 3739 or at any other facsimile number previously furnished in writing to
such Senior Trustee by the Issuer.

 

SECTION 1.06.  Notice
to Holders; Waiver.

 

Where this Senior
Indenture provides for notice to Holders of a series of Securities of any
event, such notice shall be given (unless otherwise expressly provided herein
or in the Securities of a series) in writing and mailed, first class postage
prepaid, to each Holder, at his address as it appears in the Security Register,
not later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice.

 

In any case where
notice to Holders of Securities is given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any particular Holder
of a 

 

12

 

Security shall affect the sufficiency of such notice with respect to
other Holders of Securities. Any notice mailed in the manner prescribed by this
Senior Indenture shall be deemed to have been given whether or not received by
any particular Holder. In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to give such
notice to Holders of Securities by mail, then such notification as shall be
made with the approval of the Senior Trustee for such Securities shall
constitute a sufficient notification for every purpose hereunder.

 

Notwithstanding
the first paragraph of this Section 1.06, if the entire principal amount
of the Securities of a series or a portion thereof is represented by one or
more global Securities held by a Depositary, all notices with respect to such
entire principal amount or portion thereof, as the case may be, shall be sent
only to such Depositary or its nominee, as the Holder, and such Depositary will
communicate such notices to its participants in accordance with its standard
procedures.

 

Where this Senior
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 Senior Trustee for such Securities,
but such filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.

 

A copy of any
notice or communication sent by the Issuer to any Holder of Securities shall
also be provided to the Senior Trustee for such Securities at the same time in
the manner provided for notices to the Senior Trustee under Section 1.05.

 

SECTION 1.07.  Conflict
with Trust Indenture Act.

 

If any provision
of this Senior Indenture limits, qualifies or conflicts with a provision of the
Trust Indenture Act that is required under the Trust Indenture Act to be a part
of and govern this Senior Indenture, the latter provision shall control. If any
provision of this Senior 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 Senior Indenture as so modified or excluded,
as the case may be.

 

SECTION 1.08.  Effect
of Headings and Table of Contents.

 

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

 

SECTION 1.09.  Successors
and Assigns.

 

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

 

SECTION 1.10.  Separability
Clause.

 

In any case any
provision in this Senior 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.

 

13

 

SECTION 1.11.  Benefits
of Senior Indenture.

 

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

 

SECTION 1.12.  Governing
Law.

 

This Senior
Indenture and the Securities shall be governed by and construed in accordance
with the laws of the State of New York.

 

SECTION 1.13.  Non-Business
Day.

 

Unless otherwise
specified in the Securities of a series, in any case where any Interest Payment
Date, Redemption Date or Stated Maturity of a Security of any particular series
shall not be a Business Day at any Place of Payment with respect to Securities
of that series, then (notwithstanding any other provision of this Senior
Indenture) payment of principal (or, if the context so requires, lesser amount
in the case of Discounted Securities) of (and premium, if any, on) and interest,
if any, with respect to such Security need not be made at such Place of Payment
on such date, but may be made on the next succeeding Business Day at such Place
of Payment with the same force and effect as if made on the Interest Payment
Date or Redemption Date, or at the Stated Maturity; provided that no interest
shall accrue for the period from and after such Interest Payment Date,
Redemption Date or Stated Maturity, as the case may be; and provided, further, that if such next succeeding Business Day
at any Place of Payment would fall in the succeeding fiscal year of the Issuer,
payment may be made in full on the immediately preceding Business Day at such
Place of Payment with the same force and effect as if made on the Interest
Payment Date, Redemption Date or Stated Maturity, as the case may be.

 

SECTION 1.14.  Immunity
of Incorporators, Stockholders, Officers and Directors.

 

No recourse shall
be had for the payment of the principal of (or premium, if any, on), or the
interest, if any, on any Security of any series, or for any claim based
thereon, or upon any obligation, covenant or agreement of this Senior Indenture
or any indenture supplemental hereto, or any Security, or because of any
indebtedness evidenced thereby, against any incorporator, stockholder, officer
or director, as such, past, present or future, of the Issuer or of any
predecessor or successor corporations thereto, either directly or indirectly
through the Issuer or any predecessor or successor corporations, whether by
virtue of any constitution, statute or rule of law or by the enforcement of any
assessment or penalty or otherwise; it being expressly agreed and understood
that this Senior Indenture and all the Securities of each series are solely
corporate obligations, and that no personal liability whatsoever shall attach
to, or is incurred by, any incorporator, stockholder, officer or director,
past, present or future, of the Issuer or of any predecessor or successor
corporations thereto, either directly or indirectly through the Issuer or any
such predecessor or successor corporations, because of the incurring of the
indebtedness hereby authorized or under or by reason of any of the obligations,
covenants or agreements contained in this Senior Indenture or in any of the
Securities of any series, as the case may be, or to be implied herefrom or
therefrom; and that all such personal liability is hereby expressly released
and waived as a condition of, and as 

 

14

 

part of the consideration for, the execution of this Senior Indenture
and the issuance of the Securities of each series.

 

SECTION 1.15.  Certain
Matters Relating to Currencies.

 

Whenever any
action or Act is to be taken hereunder by the Holders of Securities denominated
in different currencies or currency units, then for purposes of determining the
principal amount of Securities held by such Holders, the aggregate principal
amount of the Securities denominated in a Foreign Currency or currency unit
shall be deemed to be that amount of Dollars that could be obtained for such
principal amount on the basis of a spot rate of exchange specified to the
Senior Trustee for such series in an Exchange Rate Officers’ Certificate or a
Currency Determination Agent’s Certificate for such Foreign Currency or
currency unit into Dollars as of the date the taking of such action or Act by
the Holders of the requisite percentage in aggregate principal amount of the
Securities.

 

SECTION 1.16.  Language
of Notices, Etc.

 

Any request,
demand, authorization, direction, notice, consent, waiver or other action
required or permitted under this Senior Indenture shall be in the English
language, and any published notice may also be in an official language of the
country or province of publication.

 

15

 

SECTION 1.17.  Appointment
of Agent for Service.

 

By the execution
and delivery of this Senior Indenture, the Issuer designates and appoints
Jackson National Life Insurance Company at 1 Corporate Way, Lansing, Michigan
48951, as its authorized agent upon which process may be served in any suit or
proceeding arising out of or relating to the Securities or this Senior
Indenture which may be instituted in any Federal or New York State Court
located in the Borough of Manhattan, City and State of New York, but for that
purpose only, and agrees that service of process upon said Jackson National
Life Insurance Company, directed to the attention of Thomas J. Meyer and
written notice of said service given by the Person serving the same to it,
addressed as provided in Section 1.05, shall be deemed in every respect
effective service of process upon it in any such suit or proceeding in any
Federal or State court in such Borough, City and State. The Issuer hereby
submits (for the purposes of any such suit or proceedings) to the jurisdiction
of any such court in which any such suit or proceeding is so instituted, and
irrevocably waives, to the fullest extent it may lawfully do so, any objection
it may have now or hereafter to the laying of the venue of any such suit,
action or proceeding in any such court and irrevocably waives, to the fullest
extent it may lawfully do so, any claim that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum.
Such submission and waiver shall be irrevocable so long as any of the
Securities remain Outstanding and such appointment shall be irrevocable until
the appointment with due care of a reputable successor by the Issuer and such
successor’s acceptance of such appointment. Upon such acceptance, the Issuer
shall notify the Senior Trustee of the name and address of such successor. The
Issuer further agrees to take any and all action, including the execution and
filing of any and all such documents and instruments, as may be necessary to
continue such designation and appointment of said Jackson National Life
Insurance Company or its successor in full force and effect so long as any of
the Securities shall be Outstanding. The Senior Trustee shall not be obligated
and shall have no responsibility with respect to any failure by the Issuer to
take any such action.

 

The Issuer agrees,
to the fullest extent that it lawfully may do so, that final judgment in any
such suit, action or proceeding brought in such a court shall be conclusive and
binding upon the Issuer and may be enforced in the courts of England and Wales
(or any other courts to the jurisdiction of which the Issuer is subject) by a
suit upon such judgment, provided that service of process is effected upon the Issuer
in the manner specified in the foregoing paragraph or as otherwise permitted by
law; provided, however, that the Issuer does
not waive, and the foregoing provisions of this sentence shall not constitute
or be deemed to constitute a waiver of, (i) any right to appeal any such
judgment, to seek any stay or otherwise to seek reconsideration or review of
any such judgment, (ii) any stay of execution or levy pending an appeal from,
or a suit, action or proceeding for reconsideration of, any such judgment, or
(iii) any other right or remedy of the Issuer to the extent not expressly
waived in accordance with this Section.

 

Notwithstanding
the foregoing, any actions arising out of or relating to the Securities or this
Senior Indenture may be instituted by any party hereto and, subject to the
limitations set forth in Article Five of this Senior Indenture, by the
Holder of any Security in any competent court in England and Wales.

 

16

 

Nothing in this
Section shall affect the right of the Senior Trustee or any Holder of any
Security to serve process in any manner permitted by applicable law or limit
the right of the Senior Trustee or any Holder of any Security to bring
proceedings against the Issuer in the courts of any other jurisdiction or
jurisdictions.

 

SECTION 1.18.  Rules
by the Senior Trustee and Agents.

 

The Senior Trustee
may make reasonable rules for action by or a meeting of Holders.  The Securities Registrar or Paying Agent may
make reasonable rules and set reasonable requirements for its functions.

 

SECTION 1.19.  Successors;
No Recourse Against Others.

 

(a)                                  All
agreements of the Issuer in this Senior Indenture and the Securities shall bind
its successors.  All agreements of the
Senior Trustee in this Senior Indenture shall bind its successors.

 

(b)                                 All
liability of the Issuer described in the Securities insofar as it relates to
any director, officer, employee or stockholder, as such, of the Issuer is
waived and released by each Holder.

 

SECTION 1.20.  Duplicate
Originals.

 

The parties may
sign any number of copies of this Senior Indenture.  One signed copy is enough to prove this
Senior Indenture.

 

ARTICLE TWO

SECURITY
FORMS

 

SECTION 2.01.  Forms
of Securities.

 

The Securities of
each series shall be in such form or forms (including global form) as shall be
established by or pursuant to a Board Resolution or in an indenture
supplemental hereto, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this Senior
Indenture or any indenture supplemental hereto and may have such letters,
numbers or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with any law, with any rule or
regulation made pursuant thereto, with any rules of any securities exchange or
of any automated quotation system or to conform to usage, as may, consistently
herewith, be determined by the officers executing such Securities. Such
execution of such Securities shall be conclusive evidence as regards the Issuer
as to any such determination made by the Issuer.

 

The definitive
Securities shall be printed, lithographed or engraved or produced by any
combination of these methods or may be produced in any other manner, all as
determined by the officers executing such Securities. Such execution of such
definitive Securities shall be conclusive evidence as regards the Issuer as to
any such determination made by the Issuer.

 

17

 

SECTION 2.02.  Form
of Senior Trustee’s Certificate of Authentication.

 

Unless otherwise
specified as contemplated by Section 3.01, the Certificate of
Authentication on all Securities shall be in substantially the following form:

 

“This is one of
the Securities referred to in the Senior Indenture described herein.

 

	
   

  	
  Wilmington Trust Company,

  
	
   

  	
  as Senior Trustee

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  [Authorized Officer]

  
	
   

  	
   

  
	
   

  	
  Dated

  	
   

  	
  ”

  

 

SECTION 2.03.  Securities
in Global Form.

 

If any Security of
a series is issuable in global form, such Security may provide that it shall
represent the aggregate amount of Outstanding Securities from time to time
endorsed thereon and may also provide that the aggregate amount of Outstanding
Securities represented thereby may from time to time be increased or reduced to
reflect exchanges. Any endorsement of a Security in global form to reflect the
amount, or any increase or decrease in the amount, of Outstanding Securities
represented thereby shall be made by the Senior Trustee or Security Registrar
and in such manner as shall be specified in such Security. Any instructions by
the Issuer with respect to a Security in global form, after its initial
issuance, shall be in writing but need not comply with Section 1.02.

 

Unless otherwise
specified in the Securities of a series, every global Security authenticated
and delivered hereunder shall bear a legend in substantially the following
form:

 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE SENIOR
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY OR A NOMINEE THEREOF. 
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE REGISTERED FORM IN ACCORDANCE WITH THE TERMS HEREOF AND OF THE SENIOR
INDENTURE, TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE OR TO THE DEPOSITORY TRUST
COMPANY OR A SUCCESSOR THEREOF BY A NOMINEE OF THE DEPOSITORY TRUST COMPANY OR
A SUCCESSOR THEREOF AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
SENIOR INDENTURE.

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY (55 WATER STREET, 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
ENTITY AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY 

 

18

 

TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

ARTICLE THREE

 

THE
SECURITIES

 

SECTION 3.01.  Title;
Payment and Terms

 

The aggregate
principal amount of Securities which may be authenticated and delivered and
Outstanding under this Senior Indenture is unlimited. The Securities may be
issued up to the aggregate principal amount of Securities from time to time
authorized by or pursuant to a Board Resolution of the Issuer.

 

The Securities
will constitute direct, unconditional and (except as provided in
Section 10.06) unsecured obligations of the Issuer and will rank at least
equally with all other unsecured and unsubordinated obligations of the Issuer
(subject, in the event of insolvency, to laws of general applicability relating
to or affecting creditors’ rights).

 

The Securities may
be issued in one or more series. There shall be established in one or more
Board Resolutions or pursuant to authority granted by one or more Board
Resolutions and, subject to Section 3.03, set forth in, or determined in
the manner provided in, an Officers’ Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of Securities of any
series any or all of the following, as applicable (each of which, if so
provided, may be determined from time to time by the Issuer with respect to
unissued Securities of the series and set forth in such Securities of the
series when issued from time to time):

 

(1)                                  the
title of the Securities of that series (which shall distinguish the Securities
of that series from all other series of Securities); if the Securities of that
series will be in bearer rather than registered form, the forms, procedures and
mechanics to be employed in connection therewith; any limit upon the aggregate
principal amount of the Securities of that series which may be authenticated
and delivered under this Senior Indenture (except for Securities authenticated
and delivered upon registration of transfer of, or in exchange for, or in lieu
of, other Securities of that series pursuant to Section 3.04, 3.05, 3.06,
9.06 or 11.07 and except for any Securities which, pursuant to
Section 3.03, are deemed never to have been authenticated and delivered
hereunder);

 

(2)                                  the
percentage or percentages of principal amount at which the debt securities of
the series will be issued;

 

(3)                                  certain
dates or periods, including: (a) the original issue date or dates or periods
during which the Securities of that series may be issued; (b) the date or dates
(or manner of determining the same) on which, or the range of dates within
which, the principal of (and premium, if any, on) the Securities of that series
is payable; and (c) the record dates, 

 

19

 

if any, for the
determination of Holders of Securities of such series to whom such principal
(and premium, if any) is payable;

 

(4)                                  information
with regard to interest, including: (a) the rate or rates (or the manner of
calculation thereof, including any provisions for the increase or decrease of
such rate or rates upon the occurrence of specific events) at which the
Securities of that series shall bear interest (if any), or the discount, if
any, at which any Discounted Securities may be issued; (b) the date or dates
from which such interest shall accrue; (c) the Interest Payment Dates on which
such interest shall be payable (or manner of determining the same); and (d) the
Regular Record Date for the interest payable on any Securities on any Interest
Payment Date;

 

(5)                                  the
place or places where, subject to the provisions of Section 10.02:  (a) the principal of (and premium, if any,
on) and interest, if any, on Securities of that series shall be payable; (b)
any Securities of that series may be surrendered for registration of transfer,
any Securities of that series may be surrendered for exchange; and (c) notices
and demands to or upon the Issuer in respect of the Securities of that series
and this Senior Indenture may be served;

 

(6)                                  the
terms and conditions, if any, upon which Securities of that series may be
redeemed, purchased or repaid, in whole or in part, at the option of the Issuer
or otherwise including the period or periods within which or manner of
determining the same, the price or prices at which or manner of determining the
same, and the currency or currency unit in which the Securities may be
redeemed;

 

(7)                                  the
obligation (which may be fixed or contingent upon events), if any, of the
Issuer to redeem, purchase or repay Securities of that series pursuant to any
sinking fund or analogous provisions or at the option of a Holder thereof, and
the period or periods within which or manner of determining the same, the price
or prices at which or manner of determining the same, the currency or currency
unit in which, and the terms and conditions upon which, Securities of that
series shall be redeemed, purchased or repaid, in whole or in part, pursuant to
such obligation;

 

(8)                                  the
minimum denomination or denominations in which any Securities of that series
shall be issuable if other than integral multiples of $1,000;

 

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

 

(10)                            if
other than as set forth in this Senior Indenture, any Events of Default and any
covenants or agreements of the Issuer with respect to the Securities of that
series, whether or not such Events of Default or covenants or agreements are
consistent with the Events of Default or covenants or agreements set forth
herein;

 

(11)                            if a
Person other than Wilmington Trust Company is to act as Senior Trustee for the
Securities of that series, the name and location of the Corporate Trust Office
of such Senior Trustee and if other than such Senior Trustee, the identity of
each Security Registrar and/or Paying Agent;

 

20

 

(12)                            if
other than Dollars, the currency or currency unit in which payment of the
principal of (and premium, if any, on) and interest, if any, on the Securities
of that series shall be made or in which the Securities of that series shall be
denominated and the particular provisions applicable thereto in accordance
with, in addition to or in lieu of the provisions of Section 3.11;

 

(13)                            if the
principal of (and premium, if any, on) and interest, if any, on the Securities
of that series are to be payable, at the election of the Issuer or a Holder
thereof, in a currency or currency unit other than that in which such
Securities are denominated or stated to be payable, in accordance with
provisions in addition to, in lieu of or in accordance with the provisions of
Section 3.11, the period or periods within which (including the Election
Date), and the terms and conditions upon which, such election may be made, and
the time and manner of determining the exchange rate between the currency and
currency unit in which such Securities are denominated or stated to be payable
and the currency or currency unit in which such Securities are to be so
payable;

 

(14)                            the
designation of the original Currency Determination Agent, if any, and in what
circumstances a Currency Determination Agent’s Certificate or an Exchange Rate
Officers’ Certificate shall be delivered for Securities of that series;

 

(15)                            the
index, if any, used to determine the amount of payments of principal of (and
premium, if any, on) and interest, if any, on the Securities of that series;

 

(16)                            if
other than as set forth in Section 4.01, provisions for the satisfaction
and discharge of this Senior Indenture with respect to the Securities of that
series;

 

(17)                            if the
amount of payments of principal of (and premium, if any, on) and interest, if
any, on the Securities of that series may be determined, at the election of the
Issuer or a Holder thereof, with reference to an index based on a currency or
currency unit other than that in which such Securities are denominated or
stated to be payable or any other index, the manner in which such amounts shall
be determined ;

 

(18)                            the
date as of which any global Security representing Outstanding Securities of
that series shall be dated if other than the date of original issuance of the
first Security of that series to be issued;

 

(19)                            the
application, if any, of Sections 10.08 and 11.08 to the Securities of that
series;

 

(20)                            whether
the Securities of the series shall be issued in whole or in part in the form of
a global Security or Securities and, in such case, the Depositary for such
global Security or Securities;

 

(21)                            whether
any legends shall be stamped or imprinted on all or a portion of the Securities
of such series, and the terms and conditions upon which any such legends may be
removed;

 

(22)                            the
form of the Securities of that series (including the terms and conditions of
such Securities); and

 

21

 

(23)                            any
other terms of that series (which terms shall be consistent with the provisions
of this Senior Indenture except as such terms are otherwise expressly provided
for in an applicable Board Resolution or supplemental indenture executed
hereunder with respect to such series).

 

All Securities of
any particular series shall be identical except as to authentication date,
public offering price, denomination and issue date, except as may otherwise be
provided in or pursuant to such Board Resolutions and set forth in such
Officers’ Certificates relating thereto or provided in or pursuant to any supplemental
indenture hereto (provided that the Securities of a series shall be fungible
with all other Securities of such series). The terms of such Securities may be
determined by the Issuer from time to time if so provided in or established
pursuant to the authority granted in the Board Resolutions. All Securities of
any one series need not be issued at the same time, and unless otherwise
provided, a series may be reopened for issuance of additional Securities of
such series.

 

If any of the
terms of the Securities of a series are established by action taken pursuant to
one or more Board Resolutions, a copy of an appropriate record of such action
shall be certified by an appropriate officer of the Issuer and delivered to the
Senior Trustee at or prior to the delivery of the Officers’ Certificate setting
forth the terms of such Securities.

 

Prior to the
delivery of a Security of any series in any such form to the Senior Trustee for
authentication, the Issuer shall deliver to the Senior Trustee (and the Senior
Trustee shall be fully protected in relying upon) the following:

 

(1)                                  the
Board Resolution of the Issuer and, if applicable, the supplemental indenture
by or pursuant to which such form of Security to be endorsed thereon have been
approved;

 

(2)                                  an
Officers’ Certificate of the Issuer dated the date such certificate is
delivered to the Senior Trustee stating that all conditions precedent provided
for in this Senior Indenture relating to the authentication and delivery of
such Securities in such form have been complied with; and

 

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

 

SECTION 3.02.  Denominations
and Currencies.

 

Unless otherwise
provided with respect to any series of Securities as contemplated by
Section 3.01, any Securities of a series shall be issuable in
denominations of $1,000 and any integral multiple thereof.

 

22

 

SECTION 3.03.  Execution,
Authentication, Delivery and Dating.

 

The Securities
shall be executed on behalf of the Issuer by any of two of its directors or by one
director and the group secretary of the Issuer. 
The signature of any of these officers on the Securities may be manual
or facsimile or, as and to the extent required by the Depositary, manual.

 

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

 

At any time and
from time to time after the execution and delivery of this Senior Indenture,
the Issuer may deliver Securities of any series as executed by the Issuer to
the Senior Trustee for the Securities of such series for authentication,
together with an Issuer Order for the authentication and delivery of such
Securities, and such Senior Trustee, in accordance with such Issuer Order,
shall authenticate and deliver such Securities. If any Security shall be represented
by a global Security, then, for purposes of this Section and
Section 3.04, the notation of a beneficial owner’s interest therein upon
original issuance of such Security shall be deemed to be delivery in connection
with the original issuance of such beneficial owner’s interest in such global
Security. If all the Securities of any one series are not to be issued at one
time and if a Board Resolution or indenture supplemental hereto relating to
such Securities shall so permit, such Issuer Order may set forth procedures
acceptable to the Senior Trustee for the issuance of such Securities, including
without limitation, procedures with respect to interest rate, Stated Maturity,
date of issuance and date from which interest, if any, shall accrue. Such procedures
may authorize authentication and delivery pursuant to electronic instruction
from the Issuer or its duly authorized agent.

 

Notwithstanding
any contrary provision herein, if all Securities of a series are not to be
originally issued at one time, it shall not be necessary to deliver the Board
Resolution and/or indenture supplemental hereto, Officers’ Certificate and
Opinion of Counsel otherwise required pursuant to Sections 1.02 and 3.01 at or
prior to the time of authentication of each Security of such series if such
documents are delivered at or prior to the authentication upon original
issuance of the first Security of such series to be issued.

 

Each Security
shall be dated the date of its authentication.

 

No Security shall
be entitled to any benefit under this Senior Indenture or be valid or
obligatory for any purpose unless there appears on such Security a certificate
of authentication substantially in the form provided for herein executed by
manual signature by the Senior Trustee for such Security or in the name of such
Senior Trustee by any Authenticating Agent pursuant to Section 3.14, and
such certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered hereunder.
Notwithstanding the foregoing, if any Security shall have been authenticated
and delivered hereunder but never issued and sold by the Issuer, and the Issuer
shall deliver such Security to the Senior Trustee for cancellation as provided
in Section 3.09, for all purposes of this Senior Indenture such Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Senior Indenture.

 

23

 

Any global
Security shall, unless otherwise provided therein, be delivered to a Depositary
designated pursuant to Section 3.01. 
Each Depositary designated pursuant to Section 3.01 for a global
Security must at the time of its designation and at all times while it serves
as such Depositary be a clearing agency registered under the Exchange Act and
any other applicable statute or regulation.

 

The Senior Trustee
shall have the right to decline to authenticate and deliver any Securities if
the Senior Trustee, being advised by counsel, determines that such action may
not lawfully be taken or if the Senior Trustee in good faith shall determine
that such action would expose the Senior Trustee to personal liability to
existing Holders or would affect the Senior Trustee’s own rights, duties or
immunities under the Securities, this Senior Indenture or otherwise in a manner
which is not reasonably acceptable to the Senior Trustee acting in good faith.

 

SECTION 3.04.  Temporary
Securities and Exchange of Securities.

 

Pending the
preparation of definitive Securities of any particular series, the Issuer may
execute, and upon an Issuer Order the Senior Trustee for the Securities of such
series shall authenticate and deliver, in the manner specified in
Section 3.03, temporary Securities which are printed, lithographed,
typewritten, photocopied or otherwise produced in any authorized denomination,
with like terms and conditions as the definitive Securities of the series in
lieu of which they are issued, in registered form and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Securities may determine. Such execution of such Securities
shall be conclusive evidence as regards the Issuer as to any such determination
made by the Issuer.

 

If temporary
Securities of any particular series are issued, the Issuer will cause
definitive Securities of that series to be prepared without unreasonable
delay.  After the preparation of such
definitive Securities, the temporary Securities of such series shall be
exchangeable for such definitive Securities and of a like Stated Maturity and
with like terms and provisions upon surrender of the temporary Securities of
such series at the office or agency of the Issuer in a Place of Payment for
that series, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities of any particular series, the Issuer shall
execute and (in accordance with an Issuer Order delivered at or prior to the
authentication of the first definitive Security of such series) the Senior
Trustee for the Securities of such series shall authenticate and deliver in
exchange therefor a like principal amount of definitive Securities of
authorized denominations of the same series and of a like Stated Maturity and
with like terms and provisions. Until exchanged as hereinabove provided, the
temporary Securities of any series shall in all respects be entitled to the
same benefits under this Senior Indenture as definitive Securities of the same
series authenticated and delivered hereunder, with like terms and conditions,
except where specified therein with respect to certification requirements prior
to payment of interest in certain cases.

 

SECTION 3.05.  Registration,
Registration of Transfer and Exchange.

 

The Issuer shall
cause to be kept for the Securities of each series a security register (such
security register or registers herein sometimes collectively referred to as the
“Security Register”) in which, subject to such reasonable regulations as it may
prescribe, the Issuer shall provide for the registration of Securities and of
transfers of Securities.  Unless and
until 

 

24

 

otherwise determined by the Issuer, the Senior Trustee shall act as
Security Registrar and the Security Register shall be kept at the Corporate
Trust Office of the Senior Trustee.  At
all reasonable times the Security Register shall be open for inspection by the
Issuer and the Issuer and its duly authorized agents.  The Issuer may appoint co-Security Registrars
provided that at any given time there shall be only one Security Register with
respect to a series of Securities.

 

Upon surrender for
registration of transfer of any Security of any particular series at the office
or agency of the Issuer in a Place of Payment for that series, the Issuer shall
execute, and upon an Issuer Order the Senior Trustee for the Securities of each
series shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Securities of any authorized denominations, and
of a like Stated Maturity and of a like series and aggregate principal amount
and with like terms and conditions.

 

Except as set
forth below, at the option of the Holder, Securities of any particular series
may be exchanged for other Securities of any authorized denominations and of a
like Stated Maturity and of a like series and aggregate principal amount and
with like terms and conditions, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Issuer shall execute, and upon an Issuer Order the Senior
Trustee for such Securities shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive.

 

Notwithstanding
any other provision of this Section or Section 3.04, unless and until
it is exchanged in whole or in part for Securities in definitive form, a global
Security representing all or a portion of the Securities of a series may not be
transferred except as a whole by the Depositary for such series to a nominee of
such Depositary or by a nominee of such Depositary to such Depositary or
another nominee of such Depositary or by such Depositary or any such nominee to
a successor Depositary for such series or a nominee of such successor
Depositary.

 

If at any time the
Depositary for Securities of a series notifies the Issuer that it is unwilling
or unable to continue as Depositary for the Securities of such series or if at
any time the Depositary for the Securities for such series shall no longer be
eligible under Section 3.03, the Issuer shall appoint a successor
Depositary with respect to the Securities for such series. If a successor
Depositary for the Securities of such series is not appointed by the Issuer
within 120 days after the Issuer receives such notice or becomes aware of such
ineligibility, the Issuer’s election pursuant to Section 3.01 shall no
longer be effective with respect to the Securities for such series and the Issuer
will execute, and the Senior Trustee, upon receipt of an Issuer Order for the
authentication and delivery of definitive Securities of such series, will
authenticate and deliver Securities of such series in definitive form, in an
aggregate principal amount equal to the principal amount of the global Security
or Securities representing such series in exchange for such global Security or
Securities.

 

The Issuer may at
any time and in its sole discretion determine that the Securities of any series
issued in the form of one or more global Securities shall no longer be
represented by such global Security or Securities.  In such event the Issuer will execute, and
the Senior Trustee, upon receipt of an Issuer Order for the authentication and
delivery of definitive Securities of such series, will authenticate and deliver
Securities of such series in definitive form and in an aggregate principal
amount equal to the principal amount of the global 

 

25

 

Security or Securities representing such series in exchange for such
global Security or Securities.

 

If specified by
the Issuer pursuant to Section 3.01 with respect to a series of
Securities, the Depositary for such series of Securities may surrender a global
Security for such series of Securities in exchange in whole or in part for
Securities of such series of like tenor and terms, and in definitive form, on
such terms as are acceptable to the Issuer and such Depositary. Thereupon the
Issuer shall execute, and the Senior Trustee upon an Issuer Order shall
authenticate and deliver, without service charge, (i) to each Person specified
by such Depositary a new Security or Securities of the same series, of like
tenor and terms and of any authorized denomination as requested by such Person
in aggregate principal amount equal to and in exchange for such Person’s
beneficial interest in the global Security; and (ii) to such Depositary a new
global Security of like tenor and terms and in a denomination equal to the
difference, if any, between the principal amount of the surrendered global
Security and the aggregate principal amount of Securities delivered to Holders
thereof.

 

Upon the exchange
of a global Security for Securities in definitive form, such global Security if
so exchanged in its entirety shall upon an Issuer Order be cancelled by the
Senior Trustee. Securities issued in exchange for a global Security pursuant to
this Section 3.05 shall be registered in such names and in such authorized
denominations as the Depositary for such global Security, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Senior Trustee in writing. The Senior Trustee shall deliver, or
cause to be delivered, such Securities to the persons in whose names such Securities
are so requested.

 

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

 

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

 

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

 

The Issuer shall
not be required (i) to issue, register the transfer of or exchange Securities
of any series during a period beginning at the opening of business 15 days
before the day of the mailing of a notice of redemption of Securities of that
series selected for redemption under Section 11.04 and ending at the close
of business on the day of the mailing of the relevant notice of redemption, or
(ii) to register the transfer of or exchange any Security so selected for
redemption as a whole or in part, except the unredeemed portion of any Security
being redeemed in part.

 

26

 

SECTION 3.06.  Mutilated,
Destroyed, Lost and Stolen Securities.

 

If (i) any
mutilated Security is surrendered to the Senior Trustee for such Security, or
the Issuer and the Senior Trustee for a Security receive evidence to their
satisfaction of the destruction, loss or theft of any Security and (ii) there
is delivered to the Issuer and the Senior Trustee such security or indemnity as
may be required by them to save each of them and any agent of either of them
harmless, then, in the absence of notice to the Issuer or the Senior Trustee
that such Security has been acquired by a bona fide
purchaser, the Issuer shall execute and upon its request such Senior Trustee
shall authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security or in exchange for such mutilated Security, a new Security of the same
series and in a like principal amount and of a like Stated Maturity and with
like terms and conditions and bearing a number not contemporaneously
outstanding.

 

In case any such
mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, the Issuer in its discretion may, instead of issuing a new
Security, pay such Security (without surrender thereof except in the case of a
mutilated Security) if the applicant for such payment shall furnish to the Issuer
and the Senior Trustee for such Security such security or indemnity as may be
required by them to save each of them harmless, and in case of destruction,
loss or theft, evidence satisfactory to the Issuer and such Senior Trustee and
any agent of any of them of the destruction, loss or theft of such Security and
the ownership thereof.

 

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

 

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

 

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

 

SECTION 3.07.  Payment
of Interest; Interest Rights Preserved.

 

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

 

Unless otherwise
provided with respect to the Securities of any series, payment of interest may
be made at the option of the Issuer by check mailed or delivered to the address

 

27

 

of the Person entitled thereto as such address shall appear in the
Security Register or by transfer to a bank account maintained by the payee.

 

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

 

(1)                                  the
Issuer may elect to make payment of any Defaulted Interest to the Persons in
whose names the Securities of that series (or their respective Predecessor
Securities) are registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Issuer shall notify the Senior Trustee for the Securities
of such series in writing at least 30 days prior to the date of the proposed
payment of the amount of Defaulted Interest proposed to be paid on each
Security of that series and the date of the proposed payment, and at the same
time the Issuer shall deposit with such Senior Trustee an amount of money in
the currency or currency unit in which interest on the Securities of such
series are payable (except as otherwise specified pursuant to Section 3.01
for the Securities of such series and except as provided in Sections 3.11(b),
3.11(d) and 3.11(e)), equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
such Senior Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause provided.  The Issuer shall fix a Special Record Date,
and promptly give notice thereof to the Senior Trustee, for the payment of such
Defaulted Interest which shall not be more than 15 days and not less than 7
days prior to the date of the proposed payment and not less than 10 days after
the receipt by such Senior Trustee of the notice of the proposed payment.  The Issuer, or such Senior Trustee, in the
name and at the expense of the Issuer, shall cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor to be
mailed, first-class postage prepaid, to each Holder of Securities of that
series at his address as it appears in the Security Register no less than 7
days prior to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in whose names
the Securities of that series (or their respective Predecessor Securities) are
registered on such Special Record Date and shall no longer be payable pursuant
to the following clause (2); or

 

(2)                                  the
Issuer may make payment of any Defaulted Interest on Securities of any
particular series in any other lawful manner not inconsistent with the
requirements of any Stock Exchange on which the Securities may be listed, and
upon such notice as may be required by such Stock Exchange, unless, after
notice is given by the Issuer to the Senior Trustee for the Securities of such
series of the proposed manner of payment pursuant to this clause, such manner
of payment shall be deemed impracticable by such Senior Trustee.

 

Subject to the
foregoing provisions of this Section and Section 3.05, each Security
delivered under this Senior Indenture upon registration of transfer of or in
exchange for or in 

 

28

 

lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.

 

SECTION 3.08.  Persons
Deemed Owners

 

Prior to due
presentment of a Security for registration of transfer, the Issuer, the Senior
Trustee for such Security and any agent of the Issuer or such Senior Trustee
may treat the Person in whose name any such Security is registered as the owner
of such Security for the purpose of receiving payment of principal of (and
premium, if any, on) and (subject to Section 3.07) interest, if any, on
such Security and for all other purposes whatsoever, whether or not such
Security be overdue, and none of the Issuer, such Senior Trustee or any agent
of the Issuer or such Senior Trustee shall be affected by notice to the
contrary.

 

None of the
Issuer, the Senior Trustee, any Paying Agent or the Security Registrar will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests of a global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.

 

SECTION 3.09.  Cancellation.

 

Unless otherwise
specified in the Securities of a series, all Securities surrendered for
payment, redemption, registration of transfer or exchange, or delivered in
satisfaction of any sinking fund payment, shall, if surrendered to any Person
other than the Senior Trustee for such Securities, be delivered to such Senior
Trustee and shall be promptly cancelled by it. The Issuer may at any time
deliver to the Senior Trustee for Securities of a series for cancellation any
Securities previously authenticated and delivered hereunder which the Issuer
may have acquired in any manner whatsoever, and all Securities so delivered
shall be promptly cancelled by such Senior Trustee.  Notwithstanding any other provision of this
Senior Indenture to the contrary, in the case of a series, all the Securities
of which are not to be originally issued at one time, a Security of such series
shall not be deemed to have been Outstanding at any time hereunder if and to
the extent that, subsequent to the authentication and delivery thereof, such
Security is delivered to the Senior Trustee for such Security for cancellation
by the Issuer or any agent thereof upon the failure of the original purchaser
thereof to make payment therefor against delivery thereof, and any Security so
delivered to such Senior Trustee shall be promptly cancelled by it. No Securities
shall be authenticated in lieu of or in exchange for any Securities cancelled
as provided in this Section, except as expressly permitted by this Senior
Indenture. All cancelled Securities held by the Senior Trustee for such
Securities shall be disposed of by the Senior Trustee in accordance with its
standard procedures and a certificate of disposition evidencing such
disposition of Securities shall be provided to the Issuer by the Senior
Trustee, unless by an Issuer Order the Issuer shall direct that such cancelled
Securities shall be returned to it. Global Securities shall not be disposed of
until exchanged in full for definitive Securities or until payment thereon is
made in full.

 

SECTION 3.10.  Computation
of Interest.

 

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

 

29

 

SECTION 3.11.  Currency
and Manner of Payments in Respect of Securities.

 

(a)                                  With
respect to Securities of any series not permitting the election provided for in
paragraph (b) below or the Holders of which have not made the election provided
for in paragraph (b) below, payment of the principal of (and premium, if any,
on) and interest, if any, on any Security of such series will be made in the
currency or currency unit in which such Security is payable.

 

(b)                                 It
may be provided pursuant to Section 3.01 with respect to Securities of any
series that Holders shall have the option, subject to paragraphs (d) and (e)
below, to receive payments of principal of (or premium, if any, on) or
interest, if any, on such Securities in any of the currencies or currency units
which may be designated for such election by delivering to the Senior Trustee
for such series of Securities a written election with signature guarantees and
in form and substance satisfactory to such Senior Trustee, not later than the
close of business on the Election Date immediately preceding the applicable
payment date. If a Holder so elects to receive such payments in any such
currency or currency unit, such election will remain in effect for such Holder
until changed by such Holder by written notice to the Senior Trustee for such
series of Securities (but any such change may be made not later than the close
of business on the Election Date immediately preceding the next payment date to
be effective for the payment to be made on such payment date and no such change
of election may be made with respect to payments to be made on any Security of
such series with respect to which an Event of Default has occurred and is
continuing or notice of redemption has been given by the Issuer pursuant to
Article Eleven). In the event that any Holder makes any such election
pursuant to the preceding sentence, such election will not be effective with
respect to any transferee of such Holder and such transferee shall be paid in
the currency or currency unit indicated pursuant to paragraph (a) above unless
such transferee makes an election pursuant to the preceding sentence; provided, however, that such election, if in effect while
funds are on deposit with respect to the Securities of such series as described
in Section 4.01(a)(1)(B), will be effective with respect to any transferee
of such Holder unless otherwise specified pursuant to Section 3.01 for the
Securities of such series. Any Holder of any such Security who shall not have
delivered any such election to the Senior Trustee of such series of Securities
not later than the close of business on the applicable Election Date will be
paid the amount due on the applicable payment date in the relevant currency or
currency unit as provided in paragraph (a) of this Section 3.11. In no
case may a Holder of Securities of any series elect to receive payments in any
currency or currency unit as described in this Section 3.11(b) following
deposit of funds or U.S. Government Obligations with respect to the Securities
of such series as described in Section 4.01(a)(1)(B). The Senior Trustee
for each such series of Securities shall notify the Currency Determination
Agent as soon as practicable after the Election Date of the aggregate principal
amount of Securities for which Holders have made such written election.

 

(c)                                  If
the election referred to in paragraph (b) above has been provided for pursuant
to Section 3.01, then not later than the fourth Business Day after the
Regular Record Date for each payment date for Securities of any series, the Currency
Determination Agent will deliver to the Issuer a written notice specifying, in
the currency or currency unit in which Securities of such series are payable,
the respective aggregate amounts of principal of (and premium, if any, on) and
interest, if any, on the Securities to be paid on such payment date, specifying
the amounts in such currency or currency unit so payable in respect of the 

 

30

 

Securities of such series
as to which the Holders thereof shall have elected to be paid in a currency or
currency unit other than that in which such series is denominated as provided
in paragraph (b) above. If the election referred to in paragraph (b) above has
been provided for pursuant to Section 3.01 and if at least one Holder has
made such election, then, on the second Business Day preceding such payment
date the Issuer will deliver or cause to be delivered to the Senior Trustee for
such series of Securities an Exchange Rate Officers’ Certificate or a Currency
Determination Agent’s Certificate in respect of the Dollar, Foreign Currency,
euro or currency unit payments to be made on such payment date. The Dollar,
Foreign Currency, euro or currency unit amount receivable by Holders of
Securities who have elected payment in a currency or currency unit as provided
in paragraph (b) above shall, unless otherwise provided pursuant to
Section 3.01, be determined by the Issuer or the Currency Determination
Agent on the basis of the applicable Market Exchange Rate in effect on the
third Business Day (the “Valuation Date”) immediately preceding each payment
date.

 

(d)                                 Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
if a Conversion Event occurs with respect to a Foreign Currency or any other currency
unit in which any of the Securities are denominated or payable other than
pursuant to an election provided for pursuant to paragraph (b) above, then with
respect to each date for the payment of principal of (and premium, if any, on)
and interest, if any, on the applicable Securities denominated or payable in
such Foreign Currency or such other currency unit occurring after the last date
on which such Foreign Currency or such other currency unit was available (the
“Conversion Date”), the Dollar shall be the currency of payment for use on each
such payment date. The Dollar amount to be paid by the Issuer to the Senior
Trustee of each such series of Securities and with respect to such payment date
shall be the Dollar Equivalent of the Foreign Currency or, in the case of a
currency unit, the Dollar Equivalent of the Currency Unit, in each case as
determined by the Currency Determination Agent in the manner provided in
paragraph (f) or (g) below.

 

(e)                                  Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
if the Holder of a Security denominated in any currency or currency unit shall
have elected to be paid in another currency or currency unit as provided in
paragraph (b) above, and a Conversion Event occurs with respect to such elected
currency or currency unit, such Holder shall receive payment in the currency or
currency unit in which payment would have been made in the absence of such
election. Unless otherwise specified for Securities of a series pursuant to
Section 3.01, if a Conversion Event occurs with respect to the currency or
currency unit in which payment would have been made in the absence of such
election, such Holder shall receive payment in Dollars as provided in paragraph
(d) of this Section 3.11 or, in the case of a Conversion Event with
respect to Dollars, in such currency or currency units as the Senior Trustee
shall select.

 

(f)                                    Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
the “Dollar Equivalent of the Foreign Currency” shall be determined by the
Currency Determination Agent and shall be obtained for each subsequent payment
after the Conversion Date by converting the specified Foreign Currency into
Dollars at the Market Exchange Rate on the Conversion Date.

 

(g)                                 Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
the “Dollar Equivalent of the Currency Unit” shall be determined by the
Currency 

 

31

 

Determination Agent and
subject to the provisions of paragraph (h) below shall be the sum of each
amount obtained by converting the Specified Amount of each Component Currency
into Dollars at the Market Exchange Rate for such Component Currency on the
Valuation Date with respect to each payment.

 

(h)                                 For
purposes of this Section 3.11 the following terms shall have the following
meanings:

 

A “Component Currency” shall mean any currency which, on the
Conversion Date, was a component currency of the relevant currency unit.

 

“Election Date” shall mean any date for any series of
Securities as specified pursuant to Section 3.01(14) by which the written
election referred to in Section 3.11(b) may be made, such date to be not
later than the Regular Record Date for the earliest payment for which such
election may be effective.

 

A “Specified Amount” of a Component Currency shall mean the
number of units of such Component Currency or fractions thereof which were
represented in the relevant currency unit on the Conversion Date. If after the
Conversion Date the official unit of any Component Currency is altered by way
of combination or subdivision, the Specified Amount of such Component Currency
shall be divided or multiplied in the same proportion. If after the Conversion
Date two or more Component Currencies are consolidated into a single currency,
the respective Specified Amounts of such Component Currencies shall be replaced
by an amount in such single currency equal to the sum of the respective
Specified Amounts of such consolidated Component Currencies expressed in such
single currency, and such amount shall thereafter be a Specified Amount and
such single currency shall thereafter be a Component Currency. If after the
Conversion Date any Component Currency shall be divided into two or more
currencies, the Specified Amount of such Component Currency shall be replaced
by amounts of such two or more currencies, each of whose Dollar Equivalent at
the Market Exchange Rate on the date of such replacement shall be equal to the
Dollar Equivalent of the Specified Amount of such former Component Currency at
the Market Exchange Rate on such date divided by the number of currencies into
which such Component Currency was divided, and such amounts shall thereafter be
Specified Amounts and such currencies shall thereafter be Component Currencies.
If, on or after the Conversion Date of the relevant currency unit, a Conversion
Event (other than any event referred to above in this definition of “Specified
Amount”) occurs with respect to any Component Currency of such currency unit
and is continuing on the applicable Valuation Date, the Specified Amount of
such Component Currency shall, for purposes of calculating the Dollar
Equivalent of the Currency Unit, be converted into Dollars at the Market
Exchange Rate in effect on the Conversion Date of such Component Currency.

 

All decisions and
determinations of the Currency Determination Agent regarding the Dollar
Equivalent of the Foreign Currency, the Dollar Equivalent of the Currency Unit,
the Market Exchange Rate and changes in the Specified Amounts as specified
above shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive for all purposes and irrevocably binding upon the Issuer
and the Senior Trustee for the appropriate series of Securities and all Holders
of such Securities denominated or payable in the relevant currency or currency
units. The Currency Determination Agent shall promptly give written notice to 

 

32

 

the Issuer and the Senior Trustee for the appropriate series of
Securities of any such decision or determination.

 

In the event of a
Conversion Event with respect to a Foreign Currency, the Issuer, after learning
thereof, will immediately give written notice thereof to the Senior Trustee of
the appropriate series of Securities and the Currency Determination Agent (and
the Senior Trustee will promptly thereafter give notice in the manner provided
in Section 1.06 to the Holders) specifying the Conversion Date.  In the event of a Conversion Event with
respect to the euro or any other currency unit in which Securities are
denominated or payable, the Issuer, after learning thereof, will immediately
give written notice thereof to the Senior Trustee of the appropriate series of
Securities and the Currency Determination Agent (and the Senior Trustee will
promptly thereafter give notice in the manner provided in Section 1.06 to
the Holders) specifying the Conversion Date and the Specified Amount of each
Component Currency on the Conversion Date. In the event of any subsequent
change in any Component Currency as set forth in the definition of Specified
Amount above, the Issuer, after learning thereof, will similarly give written
notice to the Senior Trustee of the appropriate series of Securities and the
Currency Determination Agent.

 

The Senior Trustee
of the appropriate series of Securities shall be fully justified and protected
in relying and acting upon information received by it from the Issuer and the
Currency Determination Agent and shall not otherwise have any duty or
obligation to determine such information independently.

 

SECTION 3.12.  Currency
Determination Agent.

 

(a)                                  Unless
otherwise specified pursuant to Section 3.01, if and so long as the
Securities of any series (i) are denominated in a currency unit or a currency
other than Dollars or (ii) may be payable in a currency unit or a currency
other than Dollars, or so long as it is required under any other provision of
this Senior Indenture, then the Issuer will maintain with respect to each such
series of Securities, or as so required, a Currency Determination Agent. The
Issuer will cause the Currency Determination Agent to make the necessary
foreign exchange determinations at the time and in the manner specified
pursuant to Section 3.01 for the purpose of determining the applicable
rate of exchange and for the purpose of converting the issued currency or
currency unit into the applicable payment currency or currency unit for the
payment of principal (and premium, if any) and interest, if any, pursuant to
Section 3.11.

 

(b)                                 The
Issuer shall procure that no resignation of the Currency Determination Agent
and no appointment of a successor Currency Determination Agent pursuant to this
Section shall become effective until the acceptance of appointment by the
successor Currency Determination Agent as evidenced by a written instrument
delivered to the Issuer and the Senior Trustee of the appropriate series of
Securities accepting such appointment executed by the successor Currency
Determination Agent.

 

(c)                                  If
the Currency Determination Agent shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of the Currency
Determination Agent for any cause, with respect to the Securities of one or
more series, the Issuer, by a Board Resolution, shall promptly appoint a
successor Currency Determination Agent or Currency Determination Agents with
respect to the Securities of that or those series (it being understood that any
such successor Currency Determination Agent may be appointed with 

 

33

 

respect to the Securities
of one or more or all of such series and that at any time there shall only be
one Currency Determination Agent with respect to the Securities of any
particular series).

 

SECTION 3.13.  Common
Code, CUSIP or ISIN Numbers.

 

The Issuer in
issuing any series of the Securities may use Common Code, CUSIP or ISIN
numbers, if then generally in use, and thereafter with respect to such series,
the Senior Trustee or Security Registrar may use such numbers in any notice of
redemption with respect to such series provided that any such notice may state
that no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption or
otherwise, 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 Senior
Trustee of any change in the Common Code, CUSIP or ISIN numbers.

 

SECTION 3.14.  Authenticating
Agents.

 

From time to time
the Senior Trustee for the Securities of any series may, subject to its sole
discretion, and shall, upon receipt of an Issuer Order, and for such period as
the Issuer shall elect, appoint one or more Authenticating Agents with respect
to the Securities of such series, which may include any director or officer of
the Issuer or any Affiliate or both of them, with power to act in the name of the
Senior Trustee and subject to its discretion in the authentication and delivery
of Securities of such series in connection with transfers and exchanges under
Sections 3.04, 3.05, 3.06 and 11.07 as fully to all intents and purposes as
though such Authenticating Agent had been expressly authorized by those
Sections of this Senior Indenture to authenticate and deliver Securities of
such series.  For all purposes of this
Senior Indenture, the authentication and delivery of such Securities of such
series by an Authenticating Agent for such Securities pursuant to this
Section shall be deemed to be authentication and delivery of such
Securities “by the Senior Trustee” for the Securities of such series.  Any such Authenticating Agent shall (except
in the case of the Issuer, an Affiliate, or an officer or director of the
Issuer or an Affiliate) at all times be a corporation organized and doing
business under the laws of the United States or of any State thereof or the
District of Columbia, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by Federal, State or District of Columbia
authority, as the case may be. If such corporation publishes reports of condition
at least annually pursuant to law or the requirements of such supervising or
examining authority, then for the purposes of this Section the combined
capital and surplus of such corporation 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 an Authenticating Agent for any series of Securities
shall cease to be eligible in accordance with the provisions of this Section,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.

 

Any Authenticating
Agent for any series of Securities may resign at any time by giving written
notice of resignation to the Senior Trustee for such series and to the Issuer.
The Senior Trustee for any series of Securities may at any time and shall, upon
an Issuer Request, terminate the appointment of any Authenticating Agent by
giving written notice of termination to such Authenticating Agent and to the
Issuer in the manner set forth in Section 

 

34

 

1.05.  Upon receiving such a
notice of resignation or upon such a termination, or in case at any time any
Authenticating Agent for any series of Securities shall cease to be eligible
under this Section, the Senior Trustee for such series may and shall, upon an
Issuer Request, appoint a successor Authenticating Agent, shall give written
notice of such appointment to the Issuer and shall give written notice of such
appointment to all Holders of Securities of such series in the manner set forth
in Section 1.06. Any successor Authenticating Agent, upon acceptance of
his appointment hereunder, shall become vested with all the rights, powers and
duties of his predecessor hereunder, with like effect as if originally named as
an Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.

 

The Issuer agrees
to pay to any corporation of which any director or officer has been appointed
as Authenticating Agent for such series from time to time reasonable
compensation for such services.

 

If an appointment
with respect to one or more series of Securities is made pursuant to this
Section, the Securities of such series may have endorsed thereon, in addition
to the Senior Trustee’s certificate of authentication, an alternate certificate
of authentication substantially in the form specified in Section 2.02.

 

ARTICLE FOUR

 

SATISFACTION AND DISCHARGE

 

SECTION 4.01.  Satisfaction
and Discharge of Securities of any Series.

 

(a)                                  The
Issuer shall be deemed to have satisfied and discharged the entire indebtedness
on all the Securities of any particular series and, so long as no Event of
Default shall be continuing, the Senior Trustee for the Securities of such series,
upon an Issuer Request and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of such indebtedness,
when:

 

(1)                                  either:

 

(A)                              all
Securities of such series theretofore authenticated and delivered (other than
(i) any Securities of such series which have been mutilated, destroyed, lost or
stolen and which have been replaced or paid as provided in Section 3.06
and (ii) Securities of such series for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in the last
paragraph of Section 10.03) have been delivered to the Senior Trustee for
the Securities of such series for cancellation; or

 

(B)                                except
as otherwise specified pursuant to Section 3.01 for the Securities of such
series, with respect to all Outstanding Securities of such series described in
(A) above not theretofore so delivered to the Senior Trustee for the Securities
of such series for cancellation:

 

35

 

(i)                                     the
Issuer has irrevocably deposited, or caused to be deposited, with the Senior
Trustee for the Securities of such series as trust funds in trust an amount in
the currency or currency unit in which the Securities of such series are
payable (except as otherwise specified pursuant to Section 3.01 of the
Securities of such series and subject as to currency to Sections 3.11(b),
3.11(d) and 3.11(e), in which case the deposit to be made with respect to
Securities for which an election has occurred pursuant to Section 3.11(b)
or a Conversion Event has occurred as provided in Sections 3.11(d) and 3.11(e)
shall be made in the currency or currency unit in which such Securities are
payable as a result of such election or Conversion Event), sufficient (without
consideration of any reinvestment thereof) to pay and discharge the entire
indebtedness on all such Outstanding Securities of such series for unpaid
principal (and premium, if any) and interest, if any, to the Stated Maturity or
any Redemption Date as contemplated by Section 4.02, as the case may be;
or

 

(ii)                                  the
Issuer has deposited, or caused to be deposited, with such Senior Trustee as
obligations in trust such amount of U.S. Government Obligations as will, as
evidenced by a Certificate of a Firm of Independent Public Accountants
delivered to such Senior Trustee, together with the predetermined and certain
income to accrue thereon (without consideration of any reinvestment thereof),
be sufficient to pay and discharge when due the entire indebtedness on all such
Outstanding Securities of such series for unpaid principal (and premium, if
any) and interest, if any, to the Stated Maturity or Redemption Date as
contemplated by Section 4.02, as the case may be; or

 

(iii)                               the
Issuer has deposited, or caused to be deposited, with such Senior Trustee in
trust an amount equal to the amount referred to in clause (i) or (ii) in any
combination of currency or currency unit or U.S. Government Obligations and has
delivered a Certificate of a Firm of Independent Public Accountants to such
Senior Trustee verifying that such combination of funds and U.S. Government
Obligations will be sufficient to pay and discharge the entire indebtedness on
all Outstanding Securities of such series for unpaid principal (and premium, if
any) and interest, if any, to the Stated Maturity or any Redemption Date as
contemplated by Section 4.02, as the case may be, taking into account the
predetermined and certain income to accrue on such U.S. Government Obligations
(but without any consideration of any reinvestment thereof) and without taking
consideration of any reinvestment of any such funds;

 

(2)                                  the
Issuer has paid or caused to be paid all other sums payable with respect to the
Securities of such series;

 

(3)                                  the
Issuer has delivered to such Senior 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 the entire indebtedness on
all Securities of such series have been complied with;

 

36

 

(4)                                  if
the Securities of such series are not to become due and payable at their Stated
Maturity within one year of the date of a deposit pursuant to
Section 4.01(a)(1)(B) or are not to be called for redemption within one
year of the date of such deposit under arrangements satisfactory to such Senior
Trustee as of the date of such deposit, then the Issuer shall have given, not
later than the date of such deposit, notice of such deposit to the Holders of
such Securities; and

 

(5)                                  if
the conditions set forth in Section 4.01(a)(1)(A) have not been satisfied,
and unless otherwise specified pursuant to Section 3.01 for the Securities
of such series, the Issuer has delivered to the Senior Trustee an Opinion of
Counsel to the effect that (A) the Issuer has received from, or there has been
published by, the Internal Revenue Service a ruling, or (B) since the date of
this Senior Indenture there has been a change in applicable United States
Federal income tax law, in either case to the effect that, and based upon which
such Opinion of Counsel shall confirm that, the beneficial owners of Securities
of such series will not recognize income, gain or loss for United States
Federal income tax purposes as a result of such deposit, satisfaction and
discharge and will be subject to United States Federal income tax on the same
amount and in the same manner and at the same time as would have been the case
if such deposit, satisfaction and discharge had not occurred.

 

(b)                                 Upon
the satisfaction of the conditions set forth in this Section 4.01 with
respect to all the Securities of any series, the terms and conditions of the
Securities of such series, including the terms and conditions with respect
thereto set forth in this Senior Indenture, as applicable shall no longer be
binding upon, or applicable to, the Issuer, and the Holder of the Securities of
such series shall look for payment only to the funds or obligations deposited
with the Senior Trustee pursuant to Section 4.01(a)(1)(B); provided, however, that in no event shall the Issuer be
discharged from (i) any payment obligations in respect of Securities of such
series which are deemed not to be Outstanding under clause (3) of the
definition thereof if such obligations continue to be valid obligations of the
Issuer under applicable law, (ii) any obligations under Sections 4.02(b), 6.07
and 6.10 and (iii) any obligations under Sections 3.04, 3.05 and 3.06 (except
that Securities of such series issued upon registration of transfer or exchange
or in lieu of mutilated, destroyed, lost or stolen Securities shall not be
obligations of the Issuer) and Sections 3.11, 5.16, 7.01 and 10.02; and provided, further, that in the event a petition seeking
relief under any applicable Bankruptcy Law is filed and not discharged with
respect to the Issuer within 123 days after the deposit, the entire
indebtedness on all Securities of such series shall not be discharged, and in
such event the Senior Trustee shall return such deposited funds or obligations
as it is then holding to the Issuer upon an Issuer Request.  Notwithstanding the satisfaction of the
conditions set forth in this Section 4.01, with respect to all the Securities
of any series not denominated in Dollars, upon the happening of any Conversion
Event the indebtedness represented by such Securities shall be converted from
the currency or currency unit in which such Security is payable into Dollars at
the Dollar Equivalent of the Foreign Currency or the Dollar equivalent of the
Currency Unit and the Issuer shall be obligated to make the payments in Dollars
(or such other currency as set out in Section 3.11(e)) required by
Section 3.11(d) or 3.11(e) to the extent that the Currency Determination
Agent is unable to convert any Foreign Currency or currency unit so deposited
with the Senior Trustee pursuant to Section 4.01(a)(1)(B) into the Dollar
Equivalent of the Foreign Currency or the Dollar Equivalent of the Currency
Unit, as the case may be.  The Senior
Trustee for such series of Securities shall return to the Issuer any
non-converted funds or securities in its possession after such payments have
been made.

 

37

 

SECTION 4.02.  Application
of Trust Money.

 

(a)                                  All
money and obligations deposited with the Senior Trustee for any series of
Securities pursuant to Section 4.01 shall be held irrevocably in trust and
shall be made under the terms of an escrow trust agreement in form satisfactory
to such Senior Trustee. Such money and obligations shall be applied by such
Senior Trustee, in accordance with the provisions of the Securities, this
Senior Indenture and such escrow trust agreement, to the payment, either
directly or through any Paying Agent (including the Issuer acting as its own
Paying Agent) as such Senior Trustee may determine, to the Persons entitled
thereto, of the principal of (and premium, if any, on) and interest, if any, on
the Securities for the payment of which such money and obligations have been
deposited with such Senior Trustee. If Securities of any series are to be
redeemed prior to their Stated Maturity, whether pursuant to any optional
redemption provisions or in accordance with any mandatory sinking fund
requirement, the Issuer shall make such arrangements as are satisfactory to the
Senior Trustee for any series of Securities for the giving of notice of
redemption by such Senior Trustee in the name, and at the expense, of the
Issuer.

 

(b)                                 The
Issuer shall pay and shall indemnify the Senior Trustee for any series of
Securities against any tax, fee or other charge imposed on or assessed against
U.S. Government Obligations deposited pursuant to Section 4.01 or the
interest and principal received in respect of such U.S. Government Obligations
other than any such tax, fee or other charge which by law is payable by or on
behalf of Holders. The obligation of the Issuer under this Section 4.02(b)
shall be deemed to be an obligation of the Issuer under Section 6.07(2).

 

(c)                                  Anything
in this Article Four to the contrary notwithstanding, the Senior Trustee
for any series of Securities shall deliver or pay to the Issuer from time to
time upon an Issuer Request any money or U.S. Government Obligations held by it
as provided in Section 4.01 which, as expressed in a Certificate of a Firm
of Independent Public Accountants delivered to such Senior Trustee, are in
excess of the amount thereof which would then have been required to be
deposited for the purpose for which such money or U.S. Government Obligations
were deposited or received.

 

SECTION 4.03.  Satisfaction
and Discharge of Senior Indenture.

 

Upon compliance by
the Issuer with the provisions of Section 4.01 as to the satisfaction and
discharge of each series of Securities issued hereunder, and if the Issuer has
paid or caused to be paid all other sums payable under this Senior Indenture,
this Senior Indenture shall cease to be of any other effect (except as
otherwise provided herein). Upon an Issuer Request and receipt of an Opinion of
Counsel and an Officers’ Certificate complying with the provisions of
Section 1.02, the Senior Trustees for all series of Securities (at the
expense of the Issuer) shall execute proper instruments acknowledging
satisfaction and discharge of this Senior Indenture.

 

Notwithstanding
the satisfaction and discharge of this Senior Indenture, any obligations of the
Issuer under Sections 3.04, 3.05, 3.06, 3.11, 4.02(b), 4.04, 5.16, 6.07, 6.10,
7.01 and 10.02 and the obligations of the Senior Trustee for any series of
Securities under Section 4.02 shall survive.

 

38

 

SECTION 4.04.  Reinstatement.

 

If the Senior
Trustee for any series of Securities is unable to apply any of the amounts (for
purposes of this Section 4.04, “Amounts”) or U.S. Government Obligations,
as the case may be, described in Section 4.01(a)(1)(B)(i) or (ii),
respectively, in accordance with the provisions of Section 4.01 by reason
of any legal proceeding or any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application,
each of the obligations of the Issuer under this Senior Indenture and the
Securities of such series shall be revived and reinstated as though no deposit
had occurred pursuant to Section 4.01 until such time as the Senior
Trustee for such series is permitted to apply all such Amounts or U.S.
Governmental Obligations, as the case may be, in accordance with the provisions
of Section 4.01; provided, however,
that if, due to the reinstatement of its rights or obligations hereunder, the
Issuer has made any payment of principal of (or premium, if any, on) or
interest, if any, on such Securities, the Issuer shall be subrogated to the
rights of the Holders of such Securities to receive payment from such Amounts
or U.S. Government Obligations, as the case may be, held by the Senior Trustee
for such series.

 

ARTICLE FIVE

 

REMEDIES

 

SECTION 5.01.  Events
of Default.

 

Unless otherwise
provided for in the Board Resolution or supplemental indenture pursuant to
Section 3.01 establishing the terms of a particular series of Securities,
“Event of Default” wherever used herein
with respect to any particular series of Securities 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)                                  the
Issuer defaults in the timely payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity, or default is made on the
payment of any interest due in respect of any Security of that series and, in
each case such default continues for a period of 14 days from the due date for
payment; or

 

(2)                                  the
Issuer fails to perform or observe, or breaches any of its other covenants,
obligations or warranties under this Senior Indenture in any material respect
(other than an obligation which has expressly been included in this Senior
Indenture solely for the benefit of series of Securities other than that
series) or the Securities of that series and such failure continues for a
period of 30 days after the date on which there has been given, by registered
or certified mail, to the Issuer by the Senior Trustee, or to the Issuer and
the Senior Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of such series, written notice specifying such default
requiring the breach to be remedied; or

 

(3)                                  either
a court of competent jurisdiction issues an order which is not successfully
appealed within 30 days, or an effective shareholders’ resolution is validly
adopted, for the winding up of the Issuer or the Principal Subsidiary (except,
in the case of the Principal Subsidiary, for the purposes of, or in connection
with a scheme of reconstruction, merger or amalgamation not involving
bankruptcy or insolvency the terms of which have previously been approved in
writing by the Holders of at least 75% in aggregate 

 

39

 

principal amount of the
Outstanding Securities of that series or in the event of a voluntary winding up
where surplus assets are available for distribution); or

 

(4)                                  if
either the Issuer or the Principal Subsidiary stop or threaten to stop payments
to creditors generally or either the Issuer or the Principal Subsidiary ceases
or threatens to cease to carry on its business or substantially the whole of
the business of the Issuer or the Principal Subsidiary (except for the purposes
of, or in connection with, a reconstruction or amalgamation the terms of which
have previously been approved in writing by the Holders of at least 75% in
principal amount of the Outstanding Securities of that series or, in the case
of the Principal Subsidiary, in the event of a voluntary solvent winding up
where surplus assets are available for distribution); or

 

(5)                                  if
an encumbrancer takes possession or an administrative or other receiver or an
administrator is appointed of the whole or any substantial part of the
undertaking, property and assets of the Issuer or the whole or any substantial
part of the undertaking, property and assets of the Principal Subsidiary, or if
a distress or execution is levied or enforced upon or sued out against the
whole or any substantial part of the chattels or property of the Issuer or the
whole or any substantial part of the chattels or property of the Principal
Subsidiary and, in the case of any of the foregoing events, is not discharged
within 60 days; or

 

(6)                                  if
either the Issuer or the Principal Subsidiary is unable to pay its debts within
the meaning of Section 123(2) of the Insolvency Act 1986 of the United
Kingdom; or

 

(7)                                  if
the Indebtedness for Moneys Borrowed of the Issuer or the Indebtedness for
Moneys Borrowed of the Principal Subsidiary, which indebtedness in respect of
any single company has an outstanding aggregate principal amount of at least
£30,000,000 (or its equivalent in any other currency or currencies) is not paid
on its due date as extended by any applicable grace period and following a
demand therefore, or is so declared to be or automatically becomes, due and
payable prior to its stated maturity by reason of default or if any guarantee
or indemnity in respect of Indebtedness for Moneys Borrowed of any third party
that the Issuer or the Principal Subsidiary has given (having in respect of any
single company an outstanding aggregate principal amount as aforesaid) is not honored
when due and called upon and, in any such case, the liability of the Issuer or
the liability of the Principal Subsidiary, as the case may be, to make payment
is not being contested in good faith; or

 

(8)                                  if
the Principal Subsidiary shall cease to be a Subsidiary, except pursuant to an
amalgamation, reconstruction or winding up the terms of which have previously
been approved in writing by Holders of at least 75% in aggregate principal
amount of the outstanding Securities of that series or a voluntary solvent
winding up where surplus assets are available for distribution. 

 

The Issuer shall
deliver to the Senior Trustee, as soon as possible and in any event within five
days after the Issuer becomes aware of the occurence of any Event of Default or
an event which, with notice or the lapse of time or both, would constitute an
Event of Default, an Officers' Certificate setting forth the nature and status
of such Event of Default.

 

SECTION 5.02.  Acceleration
of Maturity; Rescission and Annulment.

 

If an Event of
Default with respect to any particular series of Securities occurs and is
continuing, the Senior Trustee for the Securities of such series or the Holders
of not less than 25% in aggregate principal amount of the Outstanding
Securities of that series may exercise any right, power or remedy permitted by
law, and shall have, in particular, without limiting the generality of the
foregoing, the right to declare the entire principal amount of (including 

 

40

 

premium, if any, on), or (in the case of Discounted Securities) such
lesser amount as may be provided for with respect to the Securities of such
series, and unless otherwise provided in a Board Resolution or supplemental
indenture pursuant to Section 3.01 hereof, any accrued but unpaid interest
on, all the Outstanding Securities of that series to be due and payable
immediately, by a notice in writing to the Issuer (and to the Senior Trustee if
given by Holders).  Upon any such
declaration of acceleration such principal or such lesser amount, as the case
may be, including premium, if any, thereon, together with any accrued interest
and all other amounts owing thereunder and hereunder (with respect to such
series of Securities), shall become immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived.

 

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

 

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

 

(A)                              in
the currency or currency unit in which that series of Securities is payable
(except as provided in Sections 3.11(b), 3.11(d) and 3.11(e)), all overdue
interest on all Securities of that series;

 

(B)                                in
the currency or currency unit in which that series of Securities is payable
(except as provided in Sections 3.11(b), 3.11(d) and 311(e)), the principal of
(and premium, if any, on) any Securities of that series which have become due
otherwise than by such declaration of acceleration and interest thereon from
the date such principal became due at a rate per annum equal to the rate borne
by the Securities of such series (or, in the case of Discounted Securities, the
Securities’ Yield to Maturity), to the extent that the payment of such interest
shall be legally enforceable;

 

(C)                                in
the currency or currency unit in which that series of Securities is payable
(except as provided in Sections 3.11(b), 3.11(d) and 311(e)), to the extent
that payment of such interest is lawful, interest upon overdue interest at the
rate or rates prescribed therefor or in the Securities of such series (or,
unless otherwise specified pursuant to Section 3.01, in the case of
Discounted Securities, the Securities’ Yield to Maturity); and

 

(D)                               in
Dollars, all sums paid or advanced by the Senior Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of such Senior
Trustee, its agents and counsel and all other amounts then due to such Senior
Trustee under Section 6.07;

 

and

 

41

 

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

 

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

 

SECTION 5.03.  Collection
of Indebtedness and Suits for Enforcement by Senior Trustee.

 

The Issuer
covenants that if:

 

(1)                                  default
is made in the payment of any interest upon any Security of any series when such
interest becomes due and payable and such default continues for a period of 14
days; or

 

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

 

the Issuer will,
upon demand of the Senior Trustee for the Securities of such series, pay to it,
for the benefit of the Holders of such Securities, the whole amount then due
and payable on such Securities for principal (and premium, if any) and
interest, if any, with interest upon the overdue principal (and premium, if
any) and, to the extent that payment of such interest shall be legally
enforceable, upon any overdue installments of interest at the rate or rates
prescribed therefor in such Securities (or, unless otherwise specified pursuant
to Section 3.01, in the case of Discounted Securities, the Securities’
Yield to Maturity); 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 such Senior
Trustee, its agents and counsel.

 

If the Issuer
fails to pay such amounts forthwith upon such demand, such Senior Trustee, in
its own name and as Senior Trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceedings 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 with respect to Securities of any particular series occurs and is
continuing, the Senior Trustee for the Securities of such series may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities of that series by such appropriate judicial proceedings
as such Senior Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Senior Indenture or in aid of the exercise of any power granted herein,
or to enforce any other proper remedy.

 

42

 

SECTION 5.04.  Senior
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 relating to the Issuer or any other obligor upon the Securities of
any series or the property of the Issuer or of such other obligor or their
creditors, the Senior Trustee for the Securities of such series (irrespective
of whether the principal (or lesser amount in the case of Discounted
Securities) of any Security of such series shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether
such Senior Trustee shall have made any demand on the Issuer for the payment of
overdue principal or interest) shall be entitled and empowered, by intervention
in such proceeding or otherwise:

 

(1)                                  to
file and prove a claim for the whole amount of principal (or lesser amount in
the case of Discounted Securities) (and premium, if any) and interest, if any,
owing and unpaid in respect of the Securities of such series and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of such Senior Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of such Senior Trustee, its
agents and counsel and all other amounts due to such Senior Trustee under
Section 6.07) and of the Holders of the Securities of such series allowed
in such judicial proceeding;

 

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

 

(3)                                  unless
prohibited by law or applicable regulations, to vote on behalf of the Holders
of the Securities of such series in any election of a trustee in bankruptcy,
liquidator or other persons performing similar functions;

 

and any receiver,
assignee, trustee, liquidator, sequestrator (or other similar official) in any
such judicial proceeding is hereby authorized by each Holder of Securities to
make such payments to such Senior Trustee, and in the event that such Senior
Trustee shall consent to the making of such payments directly to the Holders of
Securities, to pay to such Senior Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of such Senior
Trustee, its agents and counsel and any other amounts due such Senior Trustee
under Section 6.07.

 

Nothing herein
contained shall be deemed to authorize the Senior Trustee for the Securities of
any series to authorize or consent to or accept or adopt on behalf of any
Holder of a Security any plan of reorganization, arrangement, adjustment or
composition affecting the Securities of such series or the rights of any Holder
thereof, or to authorize the Senior Trustee for the Securities of any series to
vote in respect of the claim of any Holder in any such proceeding, except as
aforesaid, for the election of a trustee in bankruptcy or other person
performing similar functions.

 

SECTION 5.05.  Senior
Trustee May Enforce Claims Without Possession of Securities.

 

All rights of
action and claims under this Senior Indenture or the Securities of any series
may be prosecuted and enforced by the Senior Trustee for the Securities of any
series without the possession of any of the Securities of such series or the
production thereof in any proceeding relating thereto, and any such proceeding
instituted by such Senior Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall,

 

43

 

after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of such Senior Trustee, its agents and
counsel and all other amounts due to such Senior Trustee under
Section 6.07, be for the ratable benefit of the Holders of the Securities
of such series in respect of which such judgment has been recovered.

 

SECTION 5.06.  Application
of Money Collected.

 

Any money
collected by the Senior Trustee for the Securities of any series pursuant to
this Article with respect to the Securities of such series shall be
applied in the following order, at the date or dates fixed by such Senior
Trustee and, in case of the distribution of such money on account of principal
(or lesser amount in the case of Discounted Securities) (or premium, if any) or
interest, if any, upon presentation of the Securities of such series 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 such Senior
Trustee under Section 6.07;

 

Second:  To the payment of the amounts then due and
unpaid upon the Securities of such series for principal (or lesser amount in
the case of Discounted Securities) of (and premium, if any, on) and interest,
if any, on such 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 (or
lesser amount in the case of Discounted Securities) (and premium, if any) and
interest, if any, respectively; and

 

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

 

SECTION 5.07.  Limitation
on Suits.

 

Except as set
forth in Section 5.08, no Holder of any Security of any particular series
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Senior Indenture, or for the appointment of a receiver or
trustee, or for any other remedy hereunder, unless;

 

(1)                                  an
Event of Default with respect to that series shall have occurred and be
continuing and such Holder shall have previously given written notice to the
Senior Trustee for the Securities of such series of such Event of Default and
the continuance thereof;

 

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

 

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

 

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

 

44

 

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

 

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

 

SECTION 5.08.  Unconditional
Right of Holders to Receive Principal (and Premium, if any) and Interest, if any.

 

Notwithstanding
any other provision in this Senior Indenture, the Holder of any Security shall
have the right which is absolute and unconditional to receive payment of the
principal of (and premium, if any, on) and (subject to Section 3.07)
interest, if any, 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
right shall not be impaired without the consent of such Holder.

 

SECTION 5.09.  Restoration
of Rights and Remedies

 

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

 

SECTION 5.10.  Rights
and Remedies Cumulative.

 

Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in the last paragraph of
Section 3.06, no right or remedy herein conferred upon or reserved to the
Senior Trustee for the Securities of any series or to the Holders of Securities
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

 

SECTION 5.11.  Delay
or Omission Not Waiver.

 

No delay or
omission of the Senior Trustee for the Securities of any series or of any
Holder of any Security of such series to exercise any right or remedy accruing
upon any Event of Default with respect to the Securities of such series shall
impair any such right or remedy or constitute a waiver of any such Event of
Default or an acquiescence therein. Every 

 

45

 

right and remedy given by this Article or by law to such Senior
Trustee for the Securities of any series or to the Holders may be exercised
from time to time, and as often as may be deemed expedient, by such Senior
Trustee or by the Holders, as the case may be.

 

SECTION 5.12.  Control
by Holders.

 

Subject to
Section 6.03, the Holders of a majority in aggregate principal amount of
the Outstanding Securities of any particular series shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Senior Trustee for the Securities of such series with respect
to the Securities of that series or exercising any trust or power conferred on
such Senior Trustee with respect to such Securities; provided
that:

 

(1)                                  the
Senior Trustee may refuse to follow any direction in conflict with any rule of
law or with this Senior Indenture or which is unjustly prejudicial to the
Holders of the Securities of that series not taking part in the direction. For
the avoidance of doubt, the determination of whether any direction is unjustly
prejudicial to any Holder is solely at the discretion of the Senior Trustee;

 

(2)                                  the
Senior Trustee need not take any action which might involve it in personal
liability; and

 

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

 

SECTION 5.13.  Waiver
of Past Defaults.

 

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

 

(1)                                  a
default in the payment of the principal of (or premium, if any, on) or
interest, if any, on any Security of that series; or

 

(2)                                  a
default with respect to a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of that series affected.

 

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

 

SECTION 5.14.  Undertaking
for Costs.

 

All parties to
this Senior Indenture agree, and each Holder of any Security by his acceptance
thereof shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Senior Indenture or in any suit against the Senior Trustee for the Securities
of any series for any action taken or omitted by it as Senior Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs, 

 

46

 

including reasonable attorneys’ fees and expenses, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall (subject to applicable laws) not apply to any suit
instituted by the Senior Trustee for the Securities of any series, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% in aggregate principal amount of the Outstanding Securities of any
particular series or to any suit instituted by any Holder of any Security for
the enforcement of the payment of the principal of (or premium, if any, on) or
interest, if any, on any Security of such series on or after the respective
Stated Maturities expressed in such Security (or, in the case of redemption, on
or after the Redemption Date) or the date such Security becomes due and payable
as expressed herein.

 

SECTION 5.15.  Waiver
of Stay or Extension Laws.

 

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

 

SECTION 5.16.  Judgment
Currency.

 

If, for the
purpose of obtaining a judgment in any court with respect to any obligation of
the Issuer hereunder or under any Security, it shall become necessary to convert
into any other currency or currency unit any amount in the currency or currency
unit due hereunder or under such Security, then such conversion shall be made
by the Issuer or the Currency Determination Agent at the Market Exchange Rate
as in effect on the date of entry of the judgment (the “Judgment Date”). If
pursuant to any such judgment, conversion shall be made on a date (the
“Substitute Date”) other than the Judgment Date and there shall occur a change
between the Market Exchange Rate as in effect on the Judgment Date and the
Market Exchange Rate as in effect on the Substitute Date, the Issuer agrees to
pay such additional amounts (if any) as may be necessary to ensure that the
amount paid is equal to the amount in such other currency or currency unit
which, when converted at the Market Exchange Rate as in effect on the Judgment
Date, is the amount due hereunder or under such Security. Any amount due from
the Issuer under this Section 5.16 shall be due as a separate debt and is
not to be affected by or merged into any judgment being obtained for any other
sum due hereunder or in respect of any Security, as the case may be. In no
event, however, shall the Issuer be required to pay more in the currency or
currency unit due hereunder or under such Security at the Market Exchange Rate
as in effect on the Judgment Date than the amount of currency or currency unit
stated to be due hereunder or under such Security so that in any event the
obligations of the Issuer hereunder or under such Security will be effectively
maintained as obligations in such currency or currency unit, and the Issuer
shall be entitled to withhold (or be reimbursed for, as the case may be) any
excess of the amount actually realized upon any such conversion on the
Substitute Date over the amount due and payable on the Judgment Date.

 

47

 

ARTICLE SIX

 

THE
SENIOR TRUSTEE

 

SECTION 6.01.  Certain
Duties and Responsibilities.

 

(a)                                  Except
during the continuance of an Event of Default with respect to the Securities of
any series for which the Senior Trustee is serving as such:

 

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

 

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

 

(b)                                 In
case an Event of Default with respect to a series of Securities has occurred
and is continuing, the Senior Trustee for the Securities of such series shall
exercise such of the rights and powers vested in it by this Senior Indenture,
and use the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of his own
affairs.  The Senior Trustee will be
under no obligation to exercise any of its rights or powers under the Senior
Indenture at the request of any Holder unless such Holder shall have offered to
the Senior Trustee security and indemnity reasonably satisfactory to the Senior
Trustee against any loss, liability or expense, and then only to the extent
required by the terms of the Senior Indenture.

 

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

 

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

 

(2)                                  such
Senior 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 Senior Trustee was
negligent in ascertaining the pertinent facts;

 

(3)                                  such
Senior Trustee shall not be liable with respect to any action taken, suffered
or omitted to be taken by it in good faith in accordance with a direction
received by it pursuant to Section 5.02, 5.07, 5.12 or 5.13 or exercising
any trust or power conferred upon such Senior Trustee under this Senior
Indenture with respect to the Securities of that series; and

 

48

 

(4)                                  no
provision of this Senior Indenture shall require the Senior Trustee for any
series of Securities 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.

 

(d)                                 Whether
or not therein expressly so provided, every provision of this Senior Indenture
relating in any way to the Senior Trustee for any series of Securities shall be
subject to the provisions of this Section.

 

SECTION 6.02.  Notice
of Default.

 

Within 90 days
after the occurrence of any default hereunder with respect to Securities of any
particular series, the Senior Trustee for the Securities of such series shall
give to Holders of Securities of that series, in the manner set forth in
Section 1.06, notice of such default if actually known to such Senior
Trustee, unless such default shall have been cured or waived; provided, however, that, except in the case of a default in
the payment of the principal of (or premium, if any, on) or interest, if any,
on any Security of that series, such Senior Trustee shall be protected in
withholding such notice if and so long as it determines in good faith that the
withholding of such notice is in the interests of the Holders of Securities of
that series.  For the purpose of this
Section, the term “default” means any event which is, or after notice or lapse
of time or both would become, an Event of Default with respect to Securities of
that series.

 

SECTION 6.03.  Certain
Rights of Senior Trustee.

 

Except as
otherwise provided in Section 6.01:

 

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

 

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

 

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

 

(4)                                  such
Senior Trustee may consult with counsel of its selection and the advice or
opinion 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;

 

49

 

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

 

(6)                                  such
Senior 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, coupon or
other paper or document, but such Senior Trustee, in its discretion, may make
such further inquiry or investigation into such facts or matters as it may see
fit, and, if such Senior 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;

 

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

 

(8)                                  such
Senior Trustee shall have no duties or responsibilities with respect to and
shall have no liability for the actions taken or the failures to act of any
other Senior Trustees appointed hereunder;

 

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

 

(10)                            the
Senior Trustee shall not be deemed to have notice or knowledge of any default
or Event of Default unless a Responsible Officer of the Senior Trustee has
actual knowledge thereof or unless written notice of any event which is in fact
such a default or Event of Default is received by the Senior Trustee at its
Corporate Trust Office and such notice references the Securities and this
Senior Indenture; and

 

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

 

(12)                            before
the Senior Trustee acts or refrains from acting, the Senior Trustee may request
that the Issuer deliver an Officers’ Certificate setting forth the names of
individuals and/or titles of officers authorized at such time to take specified
actions pursuant to this Senior 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.

 

50

 

SECTION 6.04.  Not
Responsible for Recitals or Issuance of Securities.

 

The recitals and
statements contained herein (except the description of the Senior Trustee) and
in the Securities (except the Senior Trustee’s certificates of authentication)
shall be taken as the recitals of and statements of the Issuer, and the Senior
Trustee for any series of Securities assumes no responsibility for their
correctness. The Senior Trustee for any series of Securities shall not be
responsible for and makes no representations as to the validity or sufficiency
of this Senior Indenture or of the Securities (except the Senior Trustee’s
certificates of authentication thereof) of any series. The Senior Trustee for
any series of Securities shall not be accountable for the use or application by
the Issuer of the Securities or the proceeds thereof.  The Senior Trustee shall have no duty to
ascertain or inquire as to the performance of the Issuer’s covenants in
Article Ten hereof or otherwise established by the terms of any Security.

 

SECTION 6.05.  May
Hold Securities.

 

The Senior Trustee
for any series of Securities, any Paying Agent, Security Registrar or any other
agent of the Issuer or such Senior Trustee, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to
Sections 6.08 and 6.13, may otherwise deal with the Issuer with the same rights
it would have if it were not such Senior Trustee, Paying Agent, Security
Registrar or such other agent.

 

SECTION 6.06.  Money
Held in Trust.

 

Money held by the
Senior Trustee for any series of Securities (in any of its capacities
hereunder, including as Senior Trustee, Securities Registrar or Paying Agent)
in trust hereunder need not be segregated from other funds except to the extent
required by law. The Senior Trustee for any series of Securities (in any of its
capacities hereunder, including as Senior Trustee, Securities Registrar or
Paying Agent) shall be under no liability for interest on any money received by
it hereunder except as otherwise agreed in writing with the Issuer.

 

SECTION 6.07.  Compensation
and Reimbursement.

 

The Issuer agrees:

 

(1)                                  to
pay to the Senior Trustee for any series of Securities from time to time such
compensation for all services rendered by it hereunder as the Issuer and the
Senior Trustee shall mutually agree upon in writing (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 Senior Trustee for any
series of Securities upon its request for all reasonable expenses,
disbursements and advances incurred or made by such Senior Trustee in
accordance with any provision of this Senior Indenture (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct; and

 

(3)                                  to
indemnify such Senior Trustee for, and to hold it harmless against, any loss,
liability or reasonable expense incurred without negligence or willful
misconduct on its part, arising out of or in connection with the acceptance or
administration of this trust, including the reasonable costs and expenses of
defending itself against any claim (whether assented to 

 

51

 

by the Issuer, any Holder
or otherwise) or liability in connection with the exercise or performance of
any of its powers or duties hereunder.

 

As security for
the performance of the obligations of the Issuer under this Section the
Senior Trustee for any series of Securities shall have a lien prior to the
Securities upon all property and funds held or collected by such Senior Trustee
as such, except funds held in trust for the payment of principal of (or
premium, if any, on) or interest, if any on particular Securities.

 

Without prejudice
to any other rights available to the Senior Trustee under applicable law, when the
Senior Trustee incurs expenses (including the reasonable fees and expense of
its counsel) or renders services after an Event of Default specified in
Section 5.01(3), (4), (5) or (6) occurs, the expenses and the compensation
for the services are intended to constitute expenses of administration under
any Bankruptcy Law.

 

The rights of the
Senior Trustee under this Section 6.07 shall survive the resignation or
removal of the Senior Trustee, the payment in full of the Securities for which
it is the Senior Trustee, the discharge of this Senior Indenture, and the
termination hereof.

 

SECTION 6.08.  Disqualification;
Conflicting Interests.

 

The Senior Trustee
for the Securities shall be subject to the provisions of Section 310(b) of
the Trust Indenture Act during the period of time required thereby. Nothing
herein shall prevent the Senior Trustee from filing with the Commission the
application referred to in the penultimate paragraph of Section 310(b) of
the Trust Indenture Act. In determining whether the Senior Trustee has a
conflicting interest as defined in Section 310(b) of the Trust Indenture
Act with respect to the Securities of any series, there shall be excluded
Securities of any particular series of Securities other than that series. If
the Senior Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Senior Trustee shall either eliminate
such interest or resign, to the extent and in the manner provided by, and
subject to the provisions of, the Trust Indenture Act and this Senior
Indenture.

 

SECTION 6.09.  Corporate
Senior Trustee Required; Different Senior Trustees for Different Series;
Eligibility.

 

There shall at all
times be a Senior Trustee hereunder which shall be:

 

(1)                                  a
corporation organized and doing business under the laws of the United States of
America, any state thereof, or the District of Columbia, authorized under such
laws to exercise corporate trust power and subject to supervision or
examination by Federal or State authority; or

 

(2)                                  a
corporation or other Person organized and doing business under the laws of a
foreign government that is permitted to act as Senior Trustee pursuant to a
rule, regulation, or other order of the Commission, authorized under such laws
to exercise corporate trust powers,

 

and which shall
have at all times a combined capital and surplus of at least $50,000,000. If
such corporation or other Person publishes reports of condition at least
annually, pursuant to 

 

52

 

law or to
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. None of the Issuer, any other obligor
upon the Securities or any Person directly or indirectly controlling,
controlled by, or under common control with the Issuer or any other obligor
upon the Securities shall serve as Senior Trustee for any of the Securities. A
different Senior Trustee may be appointed by the Issuer for any series of
Securities prior to the issuance of such Securities. If the initial Senior
Trustee for any series of Securities is to be other than Wilmington Trust
Company, the Issuer and such Senior Trustee shall, prior to the issuance of
such Securities, execute and deliver an indenture supplemental hereto, which
shall provide for the appointment of such Senior Trustee as Senior Trustee for
the Securities of such series and shall add to or change any of the provisions
of this Senior Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Senior Trustee, it
being understood that nothing herein or in such supplemental indenture shall
constitute such Senior Trustees co-Senior Trustees of the same trust and that
each such Senior Trustee shall be Senior Trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any other
such Senior Trustee. If at any time the Senior Trustee for the Securities of
any series shall cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with the effect
hereunder specified in this Article.

 

SECTION 6.10.  Resignation
and Removal; Appointment of Successor.

 

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

 

(b)                                 The
Senior Trustee for the Securities of any series may resign at any time with
respect to the Securities of such series by giving written notice thereof to
the Issuer.  If the instrument of
acceptance by a successor Senior Trustee required by Section 6.11 shall
not have been delivered to the Senior Trustee for the Securities of such series
within 30 days after the giving of such notice of resignation, the resigning
Senior Trustee may petition, at the expense of the Issuer, any court of
competent jurisdiction for the appointment of a successor Senior Trustee with
respect to the Securities of such series.

 

(c)                                  The
Senior Trustee for the Securities of any series may be removed at any time with
respect to the Securities of such series by Act of the Holders of a majority in
aggregate principal amount of the Outstanding Securities of such series,
delivered to such Senior Trustee and to the Issuer.  If the instrument of acceptance by a
successor Senior Trustee required by Section 6.11 shall not have been
delivered to the Senior Trustee for the Securities of such series within 30
days after the Act of Holders giving effect to such removal, the Senior Trustee
may petition, at the expense of the Issuer, any court of competent jurisdiction
for the appointment of a successor Senior Trustee with respect to the
Securities of such series.

 

53

 

(d)                                 If
at any time:

 

(1)                                  the
Senior Trustee for the Securities of any series shall fail to comply with
Section 310(b) of the Trust Indenture Act pursuant to Section 6.08
hereof after written request therefor by the Issuer or by any Holder who has
been a bona fide Holder of a Security of such
series for at least six months, unless the Senior Trustee’s duty to resign is
stayed in accordance with the provisions of Section 310(b) of the Trust
Indenture Act; or

 

(2)                                  such
Senior Trustee shall cease to be eligible under Section 6.09 and shall
fail to resign after written request therefor by the Issuer or by any such
Holder; or

 

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

 

(4)                                  if
an administrative or other receiver or an administrator or other similar
official is appointed in relation to such Senior Trustee, or in relation to the
whole or a material part of the assets of such Senior Trustee, or an
encumbrancer takes possession of the whole or a material part of the assets of
such Senior Trustee, or a distress or execution or other process is levied or
enforced upon or sued out against the whole or a material part of the assets of
such Senior Trustee, or if such Senior Trustee shall commence a voluntary case
or proceeding under any applicable Bankruptcy Law, or any other case or
proceeding to be adjudicated as bankrupt or insolvent, or such Senior Trustee
shall consent to the appointment of or taking possession by a receiver,
custodian, liquidator, assignee, trustee, sequestrator (or other similar
official) of such Senior Trustee or its property or affairs, or shall make an
assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action;

 

then, in any such
case, (i) the Issuer by a Board Resolution may remove such Senior Trustee or
(ii) subject to Section 5.14, any Holder who has been a bona fide Holder
of a Security of such series for at least six months may, on behalf of himself
and all others similarly situated, petition any court of competent jurisdiction
for the removal of such Senior Trustee and the appointment of a successor
Senior Trustee.

 

(e)                                  If
the Senior Trustee for the Securities of any series shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the office of Senior
Trustee for the Securities of any series for any cause, the Issuer, by a Board
Resolution, shall promptly appoint a successor Senior Trustee with respect to
the Securities of such series and shall comply with the applicable requirements
of Section 6.11. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Senior Trustee
with respect to the Securities of such series shall be appointed by Act of the
Holders of a majority in aggregate principal amount of the Outstanding
Securities of such series delivered to the Issuer and the retiring Senior
Trustee, the successor Senior Trustee so appointed shall, forthwith upon its
acceptance of such appointment in accordance with the applicable requirements
of Section 6.11, become the successor Senior Trustee for the Securities of
such series and supersede the successor Senior Trustee appointed by the Issuer.
If no successor Senior Trustee for the Securities of such series shall have
been so appointed by the Issuer or the Holders and shall have accepted
appointment in the manner required by Section 6.11, and if such Senior Trustee
is still incapable of acting, any Holder who has been a bona fide
Holder of a Security of such series for at least six months may, on behalf of 

 

54

 

himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Senior Trustee with respect to the Securities of
such series.

 

(f)                                    The
Issuer shall give notice of each resignation and each removal of the Senior
Trustee with respect to the Securities of any series and each appointment of a
successor Senior Trustee with respect to the Securities of any series in the
manner and to the extent provided in Section 1.06. Each notice shall
include the name of the successor Senior Trustee with respect to the Securities
of that series and the address of its Corporate Trust Office.

 

SECTION 6.11.  Acceptance
of Appointment by Successor.

 

(a)                                  Every
successor Senior Trustee appointed hereunder with respect to the Securities of
any series shall execute, acknowledge and deliver to the Issuer and to the
retiring Senior Trustee an instrument accepting such appointment, and thereupon
the resignation or removal of the retiring Senior Trustee shall become
effective and such successor Senior Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Senior Trustee; but, on the request of the Issuer or the
successor Senior Trustee, such retiring Senior Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Senior Trustee all the rights, powers and trusts of the retiring Senior Trustee
and shall duly assign, transfer and deliver to such successor Senior Trustee
all property and money held by such retiring Senior Trustee hereunder, subject
to the lien provided by Section 6.07.

 

(b)                                 In
case of the appointment hereunder of a successor Senior Trustee with respect to
the Securities of one or more (but not all) series, the Issuer, the retiring
Senior Trustee and each successor Senior Trustee with respect to the Securities
of one or more series shall execute and deliver an indenture supplemental
hereto wherein each successor Senior Trustee shall accept such appointment and
which (i) shall contain such provisions as shall be necessary or desirable to
transfer to, and to vest in, each successor Senior Trustee all the rights,
powers, trusts and duties of the retiring Senior Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Senior Trustee relates, (ii) if the retiring Senior Trustee is not retiring
with respect to all Securities, shall contain such provisions as shall be
deemed necessary or desirable to confirm that all the rights, powers, trusts
and duties of the retiring Senior Trustee with respect to the Securities of
that or those series as to which the retiring Senior Trustee is not retiring
shall continue to be vested in the retiring Senior Trustee and (iii) shall add
to or change any of the provisions of this Senior Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Senior Trustee, it being understood that nothing
herein or in such supplemental indenture shall constitute such Senior Trustees
co-Senior Trustees of the same trust and each such Senior Trustee shall be
Senior Trustee of a trust or trusts hereunder separate and apart from any trust
or trusts hereunder administered by any other such Senior Trustee; and upon the
execution and delivery of such supplemental indenture the resignation or
removal of the retiring Senior Trustee shall become effective to the extent
provided therein and each such successor Senior Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers,
trusts and duties of the retiring Senior Trustee with respect to the Securities
of that or those series to which the appointment of such successor Senior
Trustee relates, subject to the lien provided by Section 6.07; but, on request
of the Issuer or any successor Senior Trustee, such retiring Senior Trustee
shall duly assign, transfer 

 

55

 

and deliver to such
successor Senior Trustee all property and money held by such retiring Senior
Trustee hereunder with respect to the Securities of that or those series to
which the appointment of such successor Senior Trustee relates, subject to the
lien provided by Section 6.07.

 

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

 

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

 

SECTION 6.12.  Merger,
Conversion, Consolidation or Succession to Business.

 

Any corporation
into which the Senior Trustee for the Securities of any series may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Senior Trustee shall
be a party, or any corporation succeeding to all or substantially all of the
corporate trust business of such Senior Trustee, shall be the successor of such
Senior Trustee hereunder, provided such corporation shall be otherwise
qualified and eligible under this Article, 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 Senior
Trustee or the Authenticating Agent for such series then in office, any
successor by merger, conversion or consolidation to such authenticating Senior
Trustee, or any successor Authenticating Agent, as the case may be, may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Senior Trustee or successor Authenticating Agent
had itself authenticated such Securities.

 

SECTION 6.13.  Preferential
Collection of Claims Against the Issuer.

 

If and when the
Senior Trustee for Securities of any series shall be or become a creditor of
the Issuer (or any other obligor upon the Securities of such series), the
Senior Trustee shall be subject to the provisions of the Trust Indenture Act
regarding the collection of claims against the Issuer (or any such other
obligor).

 

ARTICLE SEVEN

 

HOLDERS’
LISTS AND REPORTS BY SENIOR TRUSTEE AND ISSUER

 

SECTION 7.01.  Issuer
to Furnish Senior Trustee Names and Addresses of Holders.

 

With respect to
each particular series of Securities, the Issuer will furnish or cause to be
furnished to the Senior Trustee for the Securities of such series:

 

(1)                                  at
least semi-annually and, if applicable, not more than 15 days after each
Regular Record Date relating to that series (or, if there is no Regular Record
Date relating to that series, on June 30 and December 31), a list, in
such form as such Senior Trustee may 

 

56

 

reasonably require,
containing all the information in the possession or control of the Issuer or
any of its Paying Agents as to the names and addresses of the Holders of that
series as of such dates, excluding from any such list all the information
already in the possession or control of the Senior Trustee which was received
by such Senior Trustee acting in any capacity with respect to such series of
Securities; and

 

(2)                                  at
such other times as such Senior Trustee or Principal Paying Agent may request
in writing, within 30 days after the receipt by the Issuer of any such request,
a list of similar form and content as of a date not more than 15 days prior to
the time such list is furnished, excluding from any such list all the
information already in the possession or control of the Senior Trustee which
was received by such Senior Trustee acting in any capacity with respect to such
series of Securities.

 

SECTION 7.02.  Preservation
of Information; Communications to Holders.

 

(a)                                  The
Senior Trustee for each series of Securities shall preserve, in as current a
form as is reasonably practicable, the names and addresses of Holders of the
Securities of such series contained in the most recent lists furnished to such
Senior Trustee as provided in Section 7.01 and the names and addresses of
Holders of the Securities of such series received by such Senior Trustee in its
capacity as Security Registrar for such series, if so acting. The Senior
Trustee for each series of Securities may destroy any list relating to such
series of Securities furnished to it as provided in Section 7.01 upon
receipt of a new list relating to such series so furnished.

 

(b)                                 If
three or more Holders of Securities of any particular series (hereinafter
referred to as “applicants”) apply in writing to the Senior Trustee for the
Securities of any such series, and furnish to such Senior Trustee reasonable
proof that each such applicant has owned a Security of that series for a period
of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
of Securities of that series with respect to their rights under this Senior
Indenture or under the Securities of that series and is accompanied by a copy
of the form of proxy or other communication which such applicants propose to
transmit, then such Senior Trustee shall, within five Business Days after the
receipt of such application, at its election, either:

 

(1)                                  afford
such applicants access to the information preserved at the time by such Senior
Trustee in accordance with Section 7.02(a); or

 

(2)                                  inform
such applicants as to the approximate number of Holders of Securities of that
series whose names and addresses appear in the information preserved at the
time by such Senior Trustee in accordance with Section 7.02(a), and as to
the approximate cost of mailing to such Holders the form of proxy or other
communication, if any, specified in such application.

 

If any such Senior
Trustee shall elect not to afford such applicants access to that information,
such Senior Trustee shall, upon the written request of such applicants, mail to
each Holder of Securities of that series whose name and address appears in the
information preserved at the time by such Senior Trustee in accordance with
Section 7.02(a), a copy of the form of proxy or other communication which
is specified in such request, with reasonable promptness after a tender to such
Senior Trustee of the material to be mailed and of payment, 

 

57

 

or provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, such Senior Trustee shall mail to
such applicants and file with the Commission, together with a copy of the
material to be mailed, a written statement to the effect that, in the opinion
of such Senior Trustee, such mailing would be contrary to the best interests of
the Holders of Securities of that series or would be in violation of applicable
law.  Such written statement shall
specify the basis of such opinion. If the Commission, after opportunity for a
hearing upon the objections specified in the written statement so filed shall
enter an order refusing to sustain any of such objections or if, after the
entry of an order sustaining one or more of such objections, the Commission
shall find, after notice and opportunity for hearing, that all the objections
so sustained have been met and shall enter an order so declaring, such Senior
Trustee shall mail copies of such material to all such Holders with reasonable
promptness after the entry of such order and the renewal of such tender; otherwise
such Senior Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.

 

(c)                                  Every
Holder of Securities of each series, by receiving and holding the same, agrees
with the Issuer and the Senior Trustee for the Securities of such series that
none of the Issuer, such Senior Trustee or any of their agents shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Holders of the Securities of such series in accordance
with Section 7.02(b), regardless of the source from which such information
was derived, and that the Senior Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under
Section 7.02(b).

 

SECTION 7.03.  Reports
by Senior Trustee.

 

(a)                                  Within
60 days after May 15 of each year commencing with the year following the first
issuance of Securities, the Senior Trustee for the Securities of each series
shall transmit by mail to all Holders of the Securities of such series, in the
manner and to the extent provided in Section 313 of the Trust Indenture
Act, a brief report dated as of each such May 15 if required by the Trust
Indenture Act.

 

(b)                                 A
copy of each such report shall, at the time of such transmission to Holders of
Securities of any series, be filed by the Senior Trustee for the Securities of
such series with each Stock Exchange, with the Commission and with the Issuer.
The Issuer will notify such Senior Trustee when such series of Securities is
listed on any Stock Exchange.

 

SECTION 7.04.  Reports
by Issuer.

 

The Issuer will:

 

(1)                                  file
with the Senior Trustee for the Securities of such series, within 15 days after
the Issuer is required to file the same with the Commission, copies of the
annual reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from time to
time by rules and regulations prescribe) which the Issuer may be required to
file with the Commission pursuant to Section 13 or Section 15(d) of
the Exchange Act; or, if the Issuer is not required to file information,
documents or reports pursuant to either of said Sections, then it will file
with such Senior Trustee and the Commission, in accordance with rules and
regulations prescribed from time 

 

58

 

to time by the
Commission, such of the supplementary and periodic information, documents and
reports which may be required pursuant to Section 13 of the Exchange Act
in respect of a security listed and registered on a national securities
exchange as may be prescribed from time to time in such rules and regulations;

 

(2)                                  file
with the Senior Trustee for the Securities of such series and the Commission,
in accordance with rules and regulations prescribed from time to time by the
Commission, such additional information, documents, and reports with respect to
compliance by the Issuer, with the conditions and covenants of this Senior
Indenture as may be required from time to time by such rules and regulations;
and

 

(3)                                  transmit
by mail to all Holders of Securities of each series, as provided in
Section 313(c) of the Trust Indenture Act, within 30 days after the filing
thereof with the Senior Trustee for the Securities of such, series, such summaries
of any information, documents and reports required to be filed by the Issuer
pursuant to paragraphs (1) and (2) of this Section as may be required by
rules and regulations prescribed from time to time by the Commission; provided
that the delivery of such reports, information and documents to the Senior
Trustee is for informational purposes only and the Senior Trustee’s receipt of
such shall not constitute notice, constructive or otherwise, of any information
contained therein or determinable therefrom, including the Issuer’s compliance
with any of its covenants hereunder or under any Securities (as to which the
Senior Trustee is entitled to rely exclusively on Officers’ Certificates).

 

ARTICLE EIGHT

 

CONSOLIDATION,
MERGER, CONVEYANCE OR TRANSFER

 

SECTION 8.01.  Issuer
May Consolidate, Etc., Only on Certain Terms.

 

So long as any
Security remains Outstanding, the Issuer shall not consolidate or amalgamate
with or merge into any other corporation or convey, transfer or lease its
properties and assets substantially as an entirety to any Person unless:

 

(1)                                  the
corporation formed by such consolidation or amalgamation or into which the
Issuer is merged, or the Person which acquires, leases or is the transferee of
or recipient of the conveyance or transfer, of substantially all of the
properties and assets of the Issuer as an entirety shall

 

(A)                              be
a corporation or other Person organized and validly existing under the laws of
any country that is a member of the Organisation for Economic Co-operation and
Development (as the same may be constituted from time to time); and

 

(B)                                expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Senior Trustee for each series of Securities, in form reasonably satisfactory
to each such Senior Trustee, with any amendments or revisions necessary to take
account of the jurisdiction in which any such corporation or Person is
organized (if other than England and Wales),

 

59

 

(i)                                     the
due and punctual payment of the principal of (and premium, if any, on) and
interest, if any, on, and any sinking fund payment in respect of, all of the
Securities,

 

(ii)                                  the
performance of every covenant of this Senior Indenture and of all the
Securities on the part of the Issuer to be performed,

 

(iii)                               such
assumption shall provide that such corporation or Person shall pay to the
Holder of any Securities such additional amounts as may be necessary in order
that every net payment of the principal of (and premium, if any, on) and interest,
if any, on such Securities will not be less than the amounts provided for in
the Securities to be then due and payable, and

 

(iv)                              with
respect to (iii) above such obligation shall extend to any deduction or
withholding for or on account of any present or future tax, assessment or
governmental charge imposed upon such payment by the United Kingdom or the
country in which any such corporation or Person is organized or any district,
municipality or other political subdivision or taxing authority thereof
(subject to the limitations set forth in Section 10.08 in respect of the
payment of additional amounts as applied to such country);

 

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

 

(3)                                  the
Issuer has delivered to the Senior Trustee for each series of Securities an
Officers’ Certificate and an Opinion of Counsel each stating that such
consolidation, amalgamation, merger, conveyance, transfer or lease and such
supplemental indenture evidencing the assumption by such corporation or Person
comply with this Senior Indenture and that all conditions precedent provided
for in this Senior Indenture relating to such transaction have been complied
with.

 

SECTION 8.02.  Successor
Corporation Substituted.

 

Upon any
consolidation, amalgamation or merger, or any conveyance, transfer or lease of
the properties and assets of the Issuer substantially as an entirety in
accordance with Section 8.01, the successor corporation formed by such
consolidation or amalgamation or into which the Issuer is merged or the Person
to which such conveyance or transfer or with which such lease is made shall
succeed to, and be substituted for, and may exercise every right and power of
the Issuer under this Senior Indenture with the same effect as if such
successor corporation or Person had been named as the Issuer herein, and
thereafter, except in the case of a lease, the predecessor corporation shall be
relieved of all obligations and covenants under this Senior Indenture or the
Securities, as the case may be.

 

60

 

ARTICLE NINE

 

SUPPLEMENTAL
INDENTURES

 

SECTION 9.01.  Supplemental
Senior Indentures Without Consent of Holders.

 

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

 

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

 

(2)                                  to
add to the covenants of the Issuer, for the benefit of the Holders of all or
any particular series of Securities (and, if such covenants are to be for the
benefit of fewer than all series of Securities, stating that such covenants are
being included solely for the benefit of such series), to convey, transfer,
assign, mortgage or pledge any property to or with the Senior Trustee for the
Securities of any such series or otherwise secure any such series of the
Securities or to surrender any right or power herein conferred upon the Issuer;
or

 

(3)                                  to
add any additional Events of Default with respect to any or all series of
Securities (and, if any such Event of Default applies to fewer than all series
of Securities, stating each series to which such Event of Default applies);
provided that any such additional Event of Default would not cause any such
series of Securities to be in default immediately upon any such addition; or

 

(4)                                  to
change or eliminate any restrictions on the payment of principal of or any
premium or interest on Securities or to provide (subject to applicable laws)
for the issuance of uncertificated Securities of any series in addition to or
in place of any certificated Securities and to make all appropriate changes for
such purposes; provided, however, that any such
action shall not adversely affect the interests of the Holders of Securities of
any series in any material respect; or

 

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

 

(6)                                  to
evidence and provide for the acceptance of appointment hereunder of a Senior
Trustee, other than Wilmington Trust Company, for a series of Securities and to
add to or change any of the provisions of this Senior Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Senior Trustee, pursuant to the requirements of
Section 6.09; or

 

(7)                                  to
evidence and provide for the acceptance of appointment hereunder by a successor
Senior Trustee with respect to the Securities of one or more series and to add
to or 

 

61

 

change any of the
provisions of this Senior Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Senior
Trustee, pursuant to the requirements of Section 6.11(b); or

 

(8)                                  to
add to the conditions, limitations and restrictions on the authorized amount,
form, terms or purposes of issue, authentication and delivery of Securities, as
herein set forth, with such other conditions, limitations and restrictions
thereafter to be observed; or

 

(9)                                  to
supplement any of the provisions of this Senior Indenture to such extent as
shall be necessary to permit or facilitate the defeasance and discharge of any
series of Securities pursuant to Section 4.01; provided,
however, that any such action shall not adversely affect the
interests of the Holders of Securities of such series or any other series of
Securities in any material respect; or

 

(10)                            to add
to or change or eliminate any provisions of this Senior Indenture as shall be
necessary or desirable in accordance with any amendments to the Trust Indenture
Act or any rules and regulations of the Commission; or

 

(11)                            to
cure any ambiguity or defect, to correct or amend or supplement any provision
herein which may be inconsistent with any other provision herein, or to make
any other provisions with respect to matters or questions arising under this
Senior Indenture; provided, that any such action shall not adversely affect the
interests of the Holders of Securities of any particular series in any material
respect; or

 

(12)                            to
establish the terms of a series of Securities to be issued hereunder pursuant
to, and in accordance with, Section 3.01.

 

SECTION 9.02.  Supplemental
Senior Indentures With Consent of Holders.

 

The Issuer, when
authorized by a Board Resolution, and the Senior Trustee or Senior Trustees for
the Securities of any or all series may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of the Senior Indenture or of
modifying in any manner the rights of the Holders of such Securities under this
Senior Indenture, but only with the consent of the Holders of more than 50% in
aggregate principal amount of the Outstanding Securities of each series of
Securities then Outstanding affected thereby, in each case by Act of said
Holders of Securities of each such series delivered to the Issuer and the
Senior Trustee for Securities of each such series; provided,
however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby:

 

(1)                                  change
the Stated Maturity of the principal of, or any installment of principal of or
interest on, any Security, or reduce the principal amount thereof or the rate
of interest thereon, if any, or any premium or principal payable upon the
redemption thereof, or change any obligation of the Issuer to pay additional
amounts pursuant to Sections 5.16 and 10.08 (except as contemplated by
Section 8.01(1) and permitted by Section 9.01(1)) or reduce the
amount of the principal of a Discounted Security that would be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.02, or change any Place of Payment where, or change the currency
or currency unit in which, any Security or the interest thereon is payable, or
impair the right to institute suit for the enforcement of any 

 

62

 

such payment on or after
the Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date); or

 

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

 

(3)                                  change
any obligation of the Issuer to maintain an office or agency in the places and
for the purposes specified in Section 10.02; or

 

(4)                                  modify
any of the provisions of this Section or Sections 5.13 or 10.07, except to
increase any specified percentage in aggregate principal amount required for
any actions by Holders or to provide that certain other provisions of this
Senior Indenture cannot be modified or waived without the consent of the Holder
of each Security affected thereby.

 

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

 

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

 

SECTION 9.03.  Execution
of Supplemental Senior Indentures.

 

In executing, or
accepting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts
created by this Senior Indenture, the Senior Trustee for any series of
Securities shall be entitled to receive, and (subject to Section 6.01)
shall be fully protected in relying upon, an Officers’ Certificate and an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Senior Indenture. The Senior Trustee for any
series of Securities may, but shall not (except to the extent required in the
case of a supplemental indenture entered into under Section 9.01(6) or
(7)) be obligated to, enter into any such supplemental indenture which affects
such Senior Trustee’s own rights, liabilities, duties or immunities under this
Senior Indenture or otherwise.

 

SECTION 9.04.  Effect
of Supplemental Senior Indentures.

 

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

 

63

 

SECTION 9.05.  Conformity
With Trust Indenture Act.

 

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

 

SECTION 9.06.  Reference
in Securities to Supplemental Senior Indentures.

 

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

 

ARTICLE TEN

 

COVENANTS

 

SECTION 10.01.  Payment
of Principal (and Premium, if any) and Interest, if any.

 

The Issuer agrees,
for the benefit of each particular series of Securities, that it will duly and
punctually pay in the currency or currency unit in which the Securities of such
series are payable (except as otherwise specified pursuant to Section 3.01
for the Securities of such series and except as provided in Sections 3.11(b),
3.11(d) and 3.11(e)) the principal of, and premium, if any, on and interest, if
any, on that series of Securities in accordance with the terms of the
Securities of such series and this Senior Indenture.

 

SECTION 10.02.  Maintenance
of Office or Agency.

 

The Issuer will
maintain in the Borough of Manhattan, The City of New York, and in each Place
of Payment for the Securities of a series an office or agency where Securities
of that series may be presented or surrendered for payment, and an office or
agency where Securities of that series may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Issuer with
respect to the Securities of that series and this Senior Indenture may be
served. The Issuer will give prompt written notice to the Senior Trustee for
the Securities of that series of the location, and 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 in respect of any series of Securities or
shall fail to furnish the Senior Trustee for the Securities of that series with
the address thereof, such presentations (to the extent permitted by law) and
surrenders of Securities of that series may be made and notices and demands may
be made or served at the Corporate Trust Office of such Senior Trustee, and the
Issuer hereby appoints the Senior Trustee as its agent to receive such
respective presentations, surrenders, notices and demands.

 

The Issuer may
also from time to time designate one or more other offices or agencies (in or
outside a Place of Payment) where the Securities of one or more series may be
presented or surrendered for any or all of the purposes specified above in this
Section and may from time to time rescind such designations; provided, however, that no such 

 

64

 

designation or rescission shall in any manner relieve the Issuer of its
obligation to maintain an office or agency in each Place of Payment for such
purpose. The Issuer will give prompt written notice to the Senior Trustee for
the Securities of each series so affected of any such designation or rescission
and of any change in the location of any such office or agency.

 

Unless otherwise
specified pursuant to Section 3.01, if and so long as the Securities of
any series (i) are denominated in a currency other than Dollars or (ii) may be
payable in a currency other than Dollars, or so long as it is required under
any other provision of the Senior Indenture, then the Issuer will maintain with
respect to each such series of Securities, or as so required, a Currency
Determination Agent.

 

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

 

If the Issuer
shall at any time act as its own Paying Agent with respect to any particular
series of Securities, it will, on or before each due date of the principal of
(or premium, if any, on) or interest, if any, on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum in the currency or currency unit in which the Securities of such
series are payable (except as otherwise specified pursuant to Section 3.01
for the Securities of such series and except as provided in Sections 3.11(b),
3.11(d) and 3.11(e)) sufficient to pay the principal and premium, if any, and
interest, if any, so becoming due until such sums shall be paid to such Persons
or otherwise disposed of as herein provided, and will promptly notify the
Senior Trustee for the Securities of such series of its action or failure so to
act.

 

Whenever the Issuer
shall have one or more Paying Agents for any particular series of Securities,
the Issuer will, prior to 10:00 a.m. in the applicable Place of Payment on each
due date of the principal of (or premium, if any, on) or interest, if any, on
any such Securities, deposit with a Paying Agent for the Securities of such
series a sum (in the currency or currency unit described in the preceding
paragraph) sufficient to pay the principal (and premium, if any) and interest,
if any, so becoming due, such sum to be held in trust for the benefit of the
Persons entitled thereto, and (unless such Paying Agent is the Senior Trustee
for the Securities of such series) the Issuer will promptly notify such Senior
Trustee of its action or failure so to act.

 

The Issuer will
cause each Paying Agent (other than the Senior Trustee) for any particular
series of Securities to execute and deliver to such Senior Trustee an
instrument in which such Paying Agent shall agree with such Senior Trustee,
subject to the provisions of this Section, that such Paying Agent will:

 

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

 

(2)                                  give
such Senior Trustee notice of any default by the Issuer (or any other obligor
upon the Securities) in the making of any payment of principal of (and premium,
if any, on) and interest, if any, on Securities of that series; and

 

65

 

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

 

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

 

Any money
deposited with the Senior Trustee or any Paying Agent for the Securities of any
series or then held by the Issuer in trust for the payment of the principal of
(and premium, if any, on) and interest, if any, on any Securities of any
particular series and remaining unclaimed for two years after such principal
(and premium, if any) and interest, if any, has become due and payable shall,
unless otherwise required by mandatory provisions of applicable escheat, or
abandoned or unclaimed property law, be paid to the Issuer, on an Issuer
Request, or (if then held by the Issuer) shall be discharged from such trusts;
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
such Senior 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 such Senior Trustee or such Paying
Agent, before being required to make any such repayment shall give notice to
the Holder of such Security in the manner set forth in Section 1.06 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 notice, any unclaimed
balance of such money then remaining will, unless otherwise required by
mandatory provisions of applicable escheat, or abandoned or unclaimed property
law be repaid to the Issuer; provided, further,
that the Senior Trustee or such Paying Agent shall give written notice of any
such unclaimed amounts to the Issuer within 30 days after the end of such
two-year period.

 

SECTION 10.04.  Statements
as to Compliance.

 

The Issuer will
deliver to the Senior Trustee for each series of Securities, within four months
after the end of each fiscal year ending after the date hereof, an Officers’
Certificate (one of the signers of which shall be the chief executive officer,
treasurer or finance director of the Issuer) stating whether or not, to the
knowledge of such officers, after due investigation, the Issuer has complied
with all conditions and covenants and fulfilled all of its obligations under
this Senior Indenture during such year and, if such officers have obtained
knowledge of any default or Event of Default, specifying all such defaults or
Events of Default and the nature and status thereof of which such officers may
have knowledge and whether any such default or Event of Default is continuing
or not.

 

For purposes of
this Section, such compliance or fulfillment shall be determined without regard
to any period of grace or requirement of notice provided under this Senior
Indenture.

 

66

 

The Issuer shall
deliver to the Senior Trustee, as soon as possible and in any event within five
days after the Issuer becomes aware of the occurrence of any Event of Default
or an event which, with notice or the lapse of time or both, would constitute
an Event of Default, an Officers’ Certificate setting forth the nature and
status of such Event of Default.

 

SECTION 10.05.  Corporate
Existence.

 

Subject to
Article Eight, the Issuer will do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence.

 

SECTION 10.06.  Negative
Pledge.

 

So long as any
Security remains Outstanding, the Issuer will not, and will ensure (so far as
the Issuer is able to do so by the proper exercise of its voting and other
rights or powers of control exercisable in relation to such company) that the
Principal Subsidiary will not, create or permit to exist any mortgage or charge
upon the whole or any part of the Issuer’s or the Principal Subsidiary’s
undertaking or assets (other than assets representing the fund or funds
maintained by the Issuer, or as the case may be, the Principal Subsidiary, in
respect of the entering into or provision of long-term contracts of insurance
(as defined in the Financial Services and Markets Act 2000 (Regulated
Activities Order 2001 of the United Kingdom)), present or future, to secure
payment of any present or future Relevant Indebtedness of the Issuer or the
Principal Subsidiary or Relevant Indebtedness of any Subsidiaries, or to secure
any guarantee or indemnity in respect thereof, without at the same time
securing the Outstanding Securities of each series, and all amounts payable
under this Senior Indenture in respect thereof, equally and ratably with the
same security as secures any such Relevant Indebtedness, guarantee or
indemnity, or with such other security as shall be approved by the holders of
at least 75% in principal amount of the Outstanding Securities of each series.

 

SECTION 10.07.  Waiver
of Certain Covenants.

 

The Issuer may
omit in any particular instance to comply with any covenant or condition set
forth in Sections 10.02, 10.05 and 10.06 and any other covenant not set forth
herein and specified pursuant to Section 3.01 to be applicable to the
Securities of any series, if before or after the time for such compliance the
Holders of not less than a majority (or 75% in the case of the covenant to
provide security approved by 75% of the Holders pursuant to Section 10.06)
in aggregate principal amount of the Outstanding Securities of each series of
Securities affected by the omission (which, in the case of a covenant not set
forth herein and specified pursuant to Section 3.01 to be applicable to
the Securities of any series, shall include only those series to which such
covenant is so specified to be applicable) shall, in each case by Act of such
Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Issuer
and the duties of the Senior Trustee and the Principal Paying Agent for the
Securities of each series with respect to any such covenant or condition shall
remain in full force and effect.

 

67

 

SECTION 10.08.  Payment
of Additional Amounts.

 

Unless otherwise
provided in the Board Resolution or supplemental indenture pursuant to
Section 3.01 establishing the terms of a particular series of Securities,
the Issuer will pay to the Holder of any Security such additional amounts as
may be necessary in order that every net payment of the principal of (and premium,
if any, on) and interest, if any, on any such Security after deduction or other
withholding for or on account of any present or future tax, assessment, duty or
other governmental charge of any nature whatsoever imposed, levied or collected
by or on behalf of the United Kingdom, or any political subdivision or taxing
authority thereof or therein having power to tax, will not be less than the
amount provided for in any such Security to be then due and payable; provided, however, that the foregoing obligation to pay
additional amounts will not apply on account of any tax, assessment, duty or
other governmental charge which is payable:

 

(1)                                  otherwise
than by deduction or withholding from payments of principal of (or premium, if
any, on) or interest, if any, on any such Security; or

 

(2)                                  by
reason of such Holder having, or having had, some personal or business
connection with the United Kingdom and not merely by reason of the fact that
payments are, or for the purposes of taxation are deemed to be, from sources
in, or secured in, the United Kingdom; or

 

(3)                                  except
in the case of the winding up of the Issuer in England, where the relevant
Security is presented for payment (where presentation is required) in the
United Kingdom; or

 

(4)                                  where
the relevant Security is presented for payment more than 30 days after the
Relevant Date (as defined below) except to the extent that the relevant Holder
would have been entitled to such additional amounts on presenting the Security
for payment on such thirtieth day; or

 

(5)                                  with
respect to a payment to an individual, where the deduction or withholding is
required to be made pursuant to any European Union Directive on the taxation of
savings implementing the conclusions of the meeting of the European Council of
Economics and Finance Ministers of November 26-27, 2000 (or any
supplemental ECOFIN meeting relating to such directive), or any law
implementing or complying with, or introduced in order to conform to, such
Directive; or

 

(6)                                  on
a Security presented for payment by a Holder who would have been able to avoid
such deduction or withholding by presenting the relevant Security to another
paying agent in a Member State of the European Union or elsewhere; or

 

(7)                                  by
reason by any estate, excise, inheritance, gift, sales, transfer, wealth or
personal property tax or any similar assessment or governmental charge; or

 

(8)                                  as
a result of the failure of a Holder to satisfy any statutory requirements or
make a declaration of non-residence or other claim for exemption; or

 

(9)                                  by
reason of a change in law or official practice of any relevant taxing authority
that becomes effective more than 30 days after the Relevant Date (as defined 

 

68

 

below) for payment of
principal (or premium, if any), or interest, if any, in respect of such
Security; or

 

(10)                            owing
to any combination of clauses (1) through (9) above (provided that such
provision is applicable to the relevant series of Securities in accordance with
this Senior Indenture).

 

No additional
amounts will be paid as provided above with respect to any payment of principal
of (or premium, if any, on) or interest, if any, on any such Security to any
Holder who is a fiduciary or partnership or other than the sole beneficial
owner of any such payment to the extent that a beneficiary or settlor with
respect to such fiduciary, a member of such a partnership or the beneficial
owner of such payment would not have been entitled to the additional amounts
had such beneficiary, settlor, member or beneficial owner been the Holder of
any such Security.

 

For the purposes
hereof the “Relevant Date” means the date on which the payment of principal of
(or premium, if any, on) or interest, if any, on any Security first becomes due
and payable but, if the full amount of the monies payable on such date has not
been received by the relevant Paying Agent or as it shall have directed on or
prior to such date, the “Relevant Date” means the date on which such monies
shall have been so received.

 

Whenever in this
Senior Indenture there is mentioned, in any context, the payment of the
principal of (or premium, if any, on) or interest, if any, on any Security,
such mention shall be deemed to include mention of the payment of additional
amounts provided for in the terms of such Securities and this Section to
the extent that, in such context, additional amounts are, were or would be
payable in respect thereof pursuant to the provisions of this Section and
express mention of the payment of additional amounts (if applicable) in any
provisions hereof shall not be construed as excluding additional amounts in
those provisions hereof where such express mention is not made.

 

If the Securities
of a series provide for the payment of additional amounts as contemplated by
Section 3.01(19), at least 10 days prior to the first Interest Payment
Date with respect to that series of Securities (or if the Securities of that
series will not bear interest prior to Maturity, the first day on which a
payment of principal and any premium is made), and at least 10 days prior to
each date of payment of principal (and premium, if any) and interest, if any,
if there has been any change with respect to the matters set forth in the
below-mentioned Officers’ Certificate, the Issuer will furnish the Senior Trustee
for that series of Securities with an Officers’ Certificate instructing such
Senior Trustee whether such payment of principal of (and premium, if any, on)
and interest, if any, on the Securities of that series shall be made to Holders
of Securities of that series without withholding for or on account of any tax,
assessment, duty or other governmental charge referred to above or described in
the Securities of that series. If any such withholding shall be required, then
such Officers’ Certificate shall specify by country the amount, if any,
required to be withheld on such payments to such Holders of Securities and the
Issuer will pay to the Senior Trustee for such series of Securities such
additional amounts as may be required pursuant to the terms applicable to such
series. The Issuer covenants to indemnify the Senior Trustee for such series of
Securities and any Paying Agent for, and to hold them harmless against, any
loss, liability or expense reasonably incurred without gross negligence or bad
faith on their part arising out of or in connection with actions taken or
omitted by any of them in reliance on 

 

69

 

any Officers’ Certificate furnished pursuant to this Section 10.08
or the failure to provide any such Officers’ Certificate.  The obligations contained in the immediately
preceding sentence of the Issuer shall survive payment of all of the
Securities, the satisfaction and discharge of this Senior Indenture, and the
resignation or removal of the Senior Trustee or any Paying Agent for such
series of Securities.

 

The Issuer hereby
undertakes that, if any withholding or deduction is imposed on a payment to an
individual and is required to be made pursuant to the proposal agreed by the
European Council of Economics and Finance Ministers (“ECOFIN”) on January 21,
2003 or any law implementing or complying with, or introduced in order to
conform to, any such Directive, it will ensure that it maintains a paying agent
with a specified office in a European Union member state that will not be obliged
to withhold or deduct tax pursuant to any European Union D rective on the
taxation of savings income implementing those proposals or any such law; provided, that under no circumstances shall the Issuer be
obliged to maintain a paying agent with a specified office in such member state
unless at least on member state of the European Union does not require a paying
agent making payments through a specified office in that member state to so
withhold or deduct tax.

 

SECTION 10.09.  Calculation
of Original Issue Discount.

 

The Issuer shall
deliver to the Senior Trustee promptly at the end of each calendar year (i) a
written notice specifying the amount of original issue discount (including
daily rates and accrual periods) accrued on Outstanding Securities as of the
end of such year and (ii) such other specific information relating to such
original issue discount as may then be relevant under the U.S. Internal Revenue
Code of 1986, as amended from time to time.

 

ARTICLE ELEVEN

 

REDEMPTION
OF SECURITIES

 

SECTION 11.01.  Applicability
of This Article.

 

Redemption of
Securities of any series (whether by operation of a sinking fund or otherwise)
as permitted or required by the terms of any such Securities shall be made in
accordance with such terms and (except as otherwise specified pursuant to
Section 3.01 with respect to Securities of such series) this Article; provided, however, that if any of the terms of any such
Securities shall conflict with any provision of this Article, the terms of such
Securities shall govern.

 

SECTION 11.02.  Election
to Redeem; Notice to Senior Trustee.

 

The election of
the Issuer to redeem any Securities of any series shall be evidenced by or
pursuant to a Board Resolution. In case of any redemption at the election of
the Issuer of less than all of the Securities of any particular series, the
Issuer shall, at least 45 days prior to the Redemption Date fixed by the Issuer
(unless a shorter notice shall be satisfactory to the Senior Trustee for the
Securities of such series) notify the Senior Trustee for the Securities of such
series by an Issuer Request of such Redemption Date and of the principal amount
of Securities of that series to be redeemed.

 

In the case of any
redemption of Securities of any series prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Senior Indenture, the Issuer shall furnish the Senior Trustee
for Securities of such series with an Officers’ Certificate evidencing compliance
with such restriction.

 

In the case of any
redemption of Securities of any series pursuant to Section 11.08, the
Issuer shall furnish the Senior Trustee for Securities of such series with an
Officers’ Certificate and an Opinion of Counsel confirming that the Issuer is
entitled to exercise the right of redemption.

 

70

 

SECTION 11.03.  Selection
of Securities to Be Redeemed.

 

If less than all
the Securities are to be redeemed, the Issuer may select the series to be
redeemed, and if less than all of the Securities of any series are to be
redeemed, the particular Securities of that series to be redeemed shall be
selected by the Issuer not more than 45 days prior to the Redemption Date from
the Outstanding Securities of that series not previously called for redemption,
by such method as the Senior Trustee for the Securities of such series shall
approve and which may provide for the selection for redemption of portions
(equal to the minimum authorized denomination for Securities of that series, or
any integral multiple thereof) of the principal amount of Securities of that
series or a denomination larger than the minimum authorized denomination for
Securities of that series pursuant to Section 3.02 in the currency or
currency unit in which the Securities of such series are denominated.

 

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

 

For all purposes
of this Senior Indenture, unless the context otherwise requires, all provisions
relating to the 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 Securities which has been or is to be redeemed.

 

SECTION 11.04.  Notice
of Redemption.

 

Unless otherwise
specified in the Securities of a series, notice of redemption shall be given in
the manner provided in Section 1.06 not later than 30 days and not earlier
than 60 days (or in the case of partial redemption 45 days) prior to the
Redemption Date, to each Holder of Securities to be redeemed.

 

All notices of
redemption shall state:

 

(1)                                  the
Redemption Date;

 

(2)                                  the
Redemption Price;

 

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

 

(4)                                  that
on the Redemption Date the Redemption Price will become due and payable upon
each such Security or portion thereof, and that interest thereon, if any, shall
cease to accrue on and after said date;

 

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

 

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

 

(7)                                  the
Common Code(s), CUSIP number(s) and ISIN, if any, with respect to such
Securities.

 

71

 

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 written request, by the Senior Trustee
for such Securities in the name and at the expense of the Issuer.

 

SECTION 11.05.  Deposit
of Redemption Price.

 

On or prior to any
Redemption Date, the Issuer shall deposit with the Senior Trustee for the
Securities to be redeemed (or, if the Issuer is acting as its own Paying Agent
for such Securities, segregate and hold in trust as provided in
Section 10.03) an amount of money in the currency or currency unit in
which the Securities of such series are payable (except as otherwise specified
pursuant to Section 3.01 for the Securities of such series and except as
provided in Sections 3.11(b), 3.11(d) and 3.11(e)) sufficient to pay the
principal amount (or, if the context so requires, lesser amount in the case of
Discounted Securities) of (and premium, if any, thereon), and (except if the Redemption
Date shall be an Interest Payment Date) any accrued interest on, all the
Securities which are to be redeemed on that date.

 

SECTION 11.06.  Securities
Payable on Redemption Date.

 

Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified in the currency or currency unit in which the Securities of
such series are payable (except as otherwise provided pursuant to Section 3.01
for the Securities of such series and except as provided in Sections 3.11(b),
3.11(d) and 3.11(e)) and from and after such date (unless the Issuer shall
default in the payment of the Redemption Price) such Securities shall cease to
bear interest.  Upon surrender of such
Security for redemption in accordance with said notice, such Security or
specified portions thereof shall be paid by the Issuer at the Redemption Price;
provided, however, that unless otherwise
specified as contemplated by Section 3.01, installments of interest on
Securities 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 Regular
Record Dates according to their terms and the provisions of Section 3.07.

 

If any Security
called for redemption shall not be so paid upon surrender thereof for
redemption, the principal (or, if the context shall so require, lesser amount
in the case of Discounted Securities) thereof (and premium, if any, thereon)
shall, until paid, bear interest from the Redemption Date at a rate per annum
equal to the rate borne by the Security (or, in the case of Discounted
Securities, the Security’s Yield to Maturity).

 

SECTION 11.07.  Securities
Redeemed in Part.

 

Any Security which
is to be redeemed only in part shall be surrendered at the Place of Payment
(with, if the Issuer, the Senior Trustee or the Security Registrar for such
Security so requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Issuer, the Senior Trustee and the Security
Registrar for such Security duly executed by, the Holder thereof or his
attorney duly authorized in writing), and the Issuer shall execute and such Senior
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, of the same series and having the same terms and
provisions and in an aggregate principal amount equal to and in exchange for
the unredeemed portion of the principal of the 

 

72

 

Security so surrendered; except that, if a global Security is so
surrendered, the Issuer shall execute, and the Senior Trustee shall
authenticate and deliver to the Depositary for such global Security, without
service charge, a new global Security of like tenor in a denomination equal to
and in exchange for the unredeemed portion of the principal amount of the
global Security so surrendered.

 

 

SECTION 11.08.  Tax
Redemption.

 

The Securities of
any series may be redeemed, subject to any other terms set forth herein and in
the Board Resolution or supplemental indenture pursuant to Section 3.01
and in such Securities, as a whole but not in part, at the option of the
Issuer, upon not more than 60 days’ nor less than 30 days’ prior notice to the
Holders of such Securities, at a Redemption Price equal to 100% of the
principal amount thereof (or, if the context so requires, such lesser amount in
the case of Discounted Securities) (and premium, if any, thereon), together
with accrued interest, if any, thereon to the Redemption Date, upon the
occurrence of a Tax Event; provided, that
Securities of any such series may not be so redeemed if such obligation of the
Issuer to pay such additional amounts or to account as provided in the
definition of Tax Event arises, because of the official application or
interpretation of the laws or regulations affecting taxation of the country in
which the Issuer is organized, or any political subdivision or taxing authority
thereof or therein having the power to tax, as a result of the consolidation,
amalgamation or merger of the Issuer with or into, or the conveyance, transfer
or lease by the Issuer of its properties and assets substantially as an
entirety to, any Person.

 

Prior to the
redemption of any series of Securities following the occurrence of a Tax Event,
the Issuer shall be required, before it gives a notice of redemption, to
deliver to the Senior Trustee an Officers’ Certificate stating that all
conditions precedent to such redemption have been complied with and an Opinion
of Counsel concluding that in the opinion of such counsel a Tax Event has
occurred and the Issuer is entitled to exercise its right of redemption in
accordance with the terms of the Securities.

 

If the Issuer
provides an Opinion of Counsel in the appropriate jurisdiction, dated as of the
date of the relevant event referred to in the preceding paragraph, that no
obligation to pay any additional amount or to account as aforesaid arises, then
that Opinion of Counsel shall be final and binding, solely for purposes of such
paragraph, on the Issuer, the Senior Trustee and the Holders of the Securities
of any such series as to the law of the relevant jurisdiction at the date of
such Opinion of Counsel.

 

ARTICLE TWELVE

 

SINKING
FUNDS

 

SECTION 12.01.  Applicability
of This Article.

 

Redemption of
Securities of any series through operation of a sinking fund as permitted or
required by the terms of any such Securities shall be made in accordance with
such terms and (except as otherwise specified pursuant to Section 3.01
with respect to Securities of such series) this Article; provided, however,
that if any of the terms of any such 

 

73

 

Securities shall conflict with any provision of this Article, the terms
of such Securities shall govern.

 

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

 

SECTION 12.02.  Satisfaction
of Sinking Fund Payments With Securities.

 

The Issuer (i) may
deliver Outstanding Securities of a series (other than any Securities previously
called for redemption) and (ii) may apply as a credit Securities of a series
which have been redeemed either at the election of the Issuer pursuant to the
terms of such Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities, in each case in
satisfaction of all or any part of any sinking fund payment with respect to the
Securities of such series required to be made pursuant to the terms of such
Securities as provided for by the terms of such series; provided,
however, that such Securities have not been previously so credited.
Such Securities shall be received and credited for such purpose by the Senior
Trustee for such Securities at the principal amount thereof (or, if the context
so requires, such lesser amount in the case of Discounted Securities) and the
amount of such sinking fund payment shall be reduced accordingly.

 

SECTION 12.03.  Redemption
of Securities for Sinking Fund.

 

Not less than 60
days prior to each sinking fund payment date for any particular series of
Securities (or such shorter period as shall be satisfactory to the Senior
Trustee for the Securities of such series), the Issuer will deliver to the
Senior Trustee for the Securities of such series an Officers’ Certificate
specifying the amount of the next ensuing mandatory sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash in the currency or currency unit in
which the Securities of that series are payable (except as otherwise specified
pursuant to Section 3.01 for the Securities of that series and except as
provided in Sections 3.11(b), 3.11(d) and 3.11(e)) and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities of that
series pursuant to Section 12.02 and shall state the basis for such credit
and that such Securities have not previously been so credited and will also
deliver to such Senior Trustee any Securities to be so delivered.  The Issuer or the Senior Trustee for the
Securities of such series shall select the Securities to be redeemed upon such
sinking fund payment date in the manner specified in Section 11.03 and
cause notice of the redemption thereof to be given in the name of and at the
expense of the Issuer in the manner provided in Section 11.04. Such notice
having been duly given, the redemption of such Securities shall be made upon
the terms and in the manner stated in Sections 11.06 and 11.07.

 

*    *    *

 

74

 

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

 

75

 

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

 

	
   

  	
  PRUDENTIAL plc,

  
	
   

  	
  as Issuer

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WILMINGTON TRUST
  COMPANY,

  
	
   

  	
  as Senior Trustee

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

76Exhibit 4.2

 

 

PRUDENTIAL plc

Issuer

 

 

and

 

 

CITIBANK, N.A.

Subordinated Trustee

 

 

 

SUBORDINATED INDENTURE

Dated as of [•], 2004

 

 

 

Subordinated Debt Securities

 

 

Reconciliation
and tie showing the location in this Subordinated Indenture of the provisions
inserted pursuant to Sections 310 to 318(a), inclusive, of the Trust Indenture
Act of 1939.

 

	
  Trust Indenture Act Section

  	
   

  	
  Subordinated Indenture Section

  
	
  §310

  	
  (a)(1)

  	
   

  	
  6.09

  
	
   

  	
  (a)(2)

  	
   

  	
  6.09

  
	
   

  	
  (a)(3)

  	
   

  	
  Not Applicable

  
	
   

  	
  (a)(4)

  	
   

  	
  Not Applicable

  
	
   

  	
  (a)(5)

  	
   

  	
  6.09

  
	
   

  	
  (b)

  	
   

  	
  6.08 and 6.10

  
	
   

  	
  (c)

  	
   

  	
  Not Applicable

  
	
  §311

  	
  (a)

  	
   

  	
  6.13

  
	
   

  	
  (b)

  	
   

  	
  6.13

  
	
   

  	
  (c)

  	
   

  	
  Not Applicable

  
	
  §312

  	
  (a)

  	
   

  	
  7.01 and 7.02(a)

  
	
   

  	
  (b)

  	
   

  	
  7.02(b)

  
	
   

  	
  (c)

  	
   

  	
  7.02(c)

  
	
  §313

  	
  (a)

  	
   

  	
  7.03(a)

  
	
   

  	
  (b)

  	
   

  	
  7.03(a)

  
	
   

  	
  (c)

  	
   

  	
  7.03(a)

  
	
   

  	
  (d)

  	
   

  	
  7.03(b)

  
	
  §314

  	
  (a)

  	
   

  	
  7.04 and 10.04

  
	
   

  	
  (b)

  	
   

  	
  Not Applicable

  
	
   

  	
  (c)

  	
   

  	
  1.02

  
	
   

  	
  (c)(1)

  	
   

  	
  1.02

  
	
   

  	
  (c)(2)

  	
   

  	
  1.02

  
	
   

  	
  (c)(3)

  	
   

  	
  1.01

  
	
   

  	
  (d)

  	
   

  	
  Not Applicable

  
	
   

  	
  (e)

  	
   

  	
  1.02

  
	
  §315

  	
  (a)

  	
   

  	
  6.01(a)

  
	
   

  	
  (b)

  	
   

  	
  6.02

  
	
   

  	
  (c)

  	
   

  	
  6.01(b)

  
	
   

  	
  (d)

  	
   

  	
  6.01(c)

  
	
   

  	
  (d)(1)

  	
   

  	
  6.01(c)(1)

  
	
   

  	
  (d)(2)

  	
   

  	
  6.01(c)(2)

  
	
   

  	
  (d)(3)

  	
   

  	
  6.01(c)(3)

  
	
   

  	
  (e)

  	
   

  	
  5.13

  
	
  §316

  	
  (a)(1)(A)

  	
   

  	
  5.02(b) and 5.11

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  5.12

  
	
   

  	
  (a)(2)

  	
   

  	
  Not Applicable

  
	
   

  	
  (b)

  	
   

  	
  5.07

  
	
   

  	
  (c)

  	
   

  	
  1.04(a)

  
	
  §317

  	
  (a)(1)

  	
   

  	
  5.03

  
	
   

  	
  (a)(2)

  	
   

  	
  5.04

  
	
   

  	
  (b)

  	
   

  	
  10.03

  
	
  §318

  	
  (a)

  	
   

  	
  1.07

  

 

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

 

i

 

TABLE OF CONTENTS

 

	
  ARTICLE ONE

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS AND OTHER PROVISIONS OF GENERAL
  APPLICATION

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.02.

  	
  COMPLIANCE CERTIFICATES AND OPINIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.03.

  	
  FORM OF DOCUMENTS DELIVERED TO SUBORDINATED
  TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.04.

  	
  ACTS OF HOLDERS; COMMUNICATION BY HOLDERS
  WITH OTHER HOLDERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.05.

  	
  NOTICES, ETC., TO SUBORDINATED TRUSTEE OR
  ISSUER

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.06.

  	
  NOTICE TO HOLDERS; WAIVER

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.07.

  	
  CONFLICT WITH TRUST INDENTURE ACT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.08.

  	
  EFFECT OF HEADINGS AND TABLE OF CONTENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.09.

  	
  SUCCESSORS AND ASSIGNS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.10.

  	
  SEPARABILITY CLAUSE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.11.

  	
  BENEFITS OF SUBORDINATED INDENTURE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.12.

  	
  GOVERNING
  LAW

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.13.

  	
  NON-BUSINESS
  DAY

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.14.

  	
  IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
  OFFICERS AND DIRECTORS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.15.

  	
  CERTAIN MATTERS RELATING TO CURRENCIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.16.

  	
  LANGUAGE OF NOTICES, ETC

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.17.

  	
  APPOINTMENT OF AGENT FOR SERVICE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.18.

  	
  RULES BY THE SUBORDINATED TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TWO

  	
   

  
	
   

  	
   

  	
   

  
	
  SECURITY FORMS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  FORMS OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2.02.

  	
  FORM OF CERTIFICATE OF AUTHENTICATION

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2.03.

  	
  SECURITIES IN GLOBAL FORM

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE THREE

  	
   

  
	
   

  	
   

  	
   

  
	
  THE SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  TITLE;
  PAYMENT AND TERMS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.02.

  	
  DENOMINATIONS
  AND CURRENCIES

  	
   

  

 

ii

 

	
  SECTION 3.03.

  	
  EXECUTION, AUTHENTICATION, DELIVERY AND
  DATING

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.04.

  	
  TEMPORARY SECURITIES AND EXCHANGE OF
  SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.05.

  	
  REGISTRATION, REGISTRATION OF TRANSFER AND
  EXCHANGE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.06.

  	
  MUTILATED, DESTROYED, LOST AND STOLEN
  SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.07.

  	
  PAYMENT OF INTEREST

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.08.

  	
  PERSONS DEEMED OWNERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.09.

  	
  CANCELLATION

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.10.

  	
  COMPUTATION OF INTEREST

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.11.

  	
  CURRENCY AND MANNER OF PAYMENTS IN RESPECT
  OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.12.

  	
  CURRENCY DETERMINATION AGENT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.13.

  	
  COMMON CODE, CUSIP OR ISIN NUMBERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.14.

  	
  AUTHENTICATING AGENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE FOUR

  	
   

  
	
   

  	
   

  	
   

  
	
  SATISFACTION AND DISCHARGE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  SATISFACTION AND DISCHARGE OF SECURITIES OF
  ANY SERIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.02.

  	
  APPLICATION OF TRUST MONEY

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.03.

  	
  SATISFACTION AND DISCHARGE OF SUBORDINATED
  INDENTURE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.04.

  	
  REINSTATEMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE FIVE

  	
   

  
	
   

  	
   

  	
   

  
	
  REMEDIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  EVENTS OF DEFAULT.

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.02.

  	
  ACCELERATION OF MATURITY; RESCISSION AND
  ANNULMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.03.

  	
  PAYMENT DEFAULTS, CAPITAL SECURITY
  DEFAULTS, PAYMENT EVENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.04.

  	
  SUBORDINATED TRUSTEE MAY FILE PROOFS OF
  CLAIM

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.05.

  	
  SUBORDINATED TRUSTEE MAY ENFORCE CLAIMS
  WITHOUT POSSESSION OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.06.

  	
  APPLICATION OF MONEY COLLECTED

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.07.

  	
  LIMITATION ON SUITS

  	
   

  

 

iii

 

	
  SECTION 5.08.

  	
  UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE
  PRINCIPAL (AND PREMIUM, IF ANY) AND INTEREST, IF ANY

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.09.

  	
  RESTORATION OF RIGHTS AND REMEDIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.10.

  	
  RIGHTS AND REMEDIES CUMULATIVE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.11.

  	
  DELAY OR OMISSION NOT WAIVER

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.12.

  	
  CONTROL BY HOLDERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.13.

  	
  WAIVER OF PAST DEFAULTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.14.

  	
  UNDERTAKING FOR COSTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.15.

  	
  WAIVER OF STAY OR EXTENSION LAWS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.16.

  	
  JUDGMENT
  CURRENCY

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE SIX

  	
   

  
	
   

  	
   

  	
   

  
	
  THE SUBORDINATED TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  CERTAIN DUTIES AND RESPONSIBILITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.02.

  	
  NOTICE
  OF DEFAULT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.03.

  	
  CERTAIN RIGHTS OF SUBORDINATED TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.04.

  	
  NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
  SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.05.

  	
  MAY HOLD SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.06.

  	
  MONEY HELD IN TRUST

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.07.

  	
  COMPENSATION AND REIMBURSEMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.08.

  	
  DISQUALIFICATION; CONFLICTING INTERESTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.09.

  	
  CORPORATE SUBORDINATED TRUSTEE REQUIRED;
  DIFFERENT SUBORDINATED TRUSTEES FOR DIFFERENT SERIES; ELIGIBILITY

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.10.

  	
  RESIGNATION AND REMOVAL; APPOINTMENT OF
  SUCCESSOR

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.11.

  	
  ACCEPTANCE OF APPOINTMENT BY SUCCESSOR

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.12.

  	
  MERGER, CONVERSION, CONSOLIDATION OR
  SUCCESSION TO BUSINESS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.13.

  	
  PREFERENTIAL COLLECTION OF CLAIMS AGAINST
  ISSUER

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE SEVEN

  	
   

  
	
   

  	
   

  	
   

  
	
  HOLDERS’ LISTS AND REPORTS BY SUBORDINATED
  TRUSTEE AND ISSUER

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 7.01.

  	
  ISSUER TO FURNISH SUBORDINATED TRUSTEE
  NAMES AND ADDRESSES OF HOLDERS

  	
   

  

 

iv

 

	
  SECTION 7.02.

  	
  PRESERVATION OF INFORMATION; COMMUNICATIONS
  TO HOLDERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 7.03.

  	
  REPORTS BY SUBORDINATED TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 7.04.

  	
  REPORTS
  BY ISSUER

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE EIGHT

  	
   

  
	
   

  	
   

  	
   

  
	
  CONSOLIDATION, MERGER, CONVEYANCE OR
  TRANSFER

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 8.01.

  	
  ISSUER MAY CONSOLIDATE, ETC., ONLY ON
  CERTAIN TERMS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 8.02.

  	
  SUCCESSOR CORPORATION SUBSTITUTED

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE NINE

  	
   

  
	
   

  	
   

  	
   

  
	
  SUPPLEMENTAL INDENTURES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.01.

  	
  SUPPLEMENTAL SUBORDINATED INDENTURES
  WITHOUT CONSENT OF HOLDERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.02.

  	
  SUPPLEMENTAL SUBORDINATED INDENTURES WITH
  CONSENT OF HOLDERS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.03.

  	
  EXECUTION OF SUPPLEMENTAL SUBORDINATED
  INDENTURES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.04.

  	
  EFFECT OF SUPPLEMENTAL SUBORDINATED
  INDENTURES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.05.

  	
  CONFORMITY WITH TRUST INDENTURE ACT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.06.

  	
  REFERENCE IN SECURITIES TO SUPPLEMENTAL
  SUBORDINATED INDENTURES

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TEN

  	
   

  
	
   

  	
   

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.01.

  	
  PAYMENT OF PRINCIPAL (AND PREMIUM, IF ANY)
  AND INTEREST AND DEFERRED INTEREST, IF ANY

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.02.

  	
  MAINTENANCE OF OFFICE OR AGENCY

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.03.

  	
  MONEY FOR SECURITIES PAYMENTS TO BE HELD IN
  TRUST

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.04.

  	
  STATEMENTS AS TO COMPLIANCE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.05.

  	
  CORPORATE EXISTENCE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.06.

  	
  WAIVER OF CERTAIN COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.07.

  	
  PAYMENT OF ADDITIONAL AMOUNTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.08.

  	
  CALCULATION OF ORIGINAL ISSUE DISCOUNT

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE ELEVEN

  	
   

  
	
   

  	
   

  	
   

  
	
  REDEMPTION OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.01.

  	
  APPLICABILITY OF THIS ARTICLE

  	
   

  

 

v

 

	
  SECTION 11.02.

  	
  ELECTION TO REDEEM; NOTICE TO SUBORDINATED
  TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.03.

  	
  SELECTION OF SECURITIES TO BE REDEEMED

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.04.

  	
  NOTICE OF REDEMPTION

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.05.

  	
  DEPOSIT OF REDEMPTION PRICE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.06.

  	
  SECURITIES PAYABLE ON REDEMPTION DATE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.07.

  	
  SECURITIES REDEEMED IN PART

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.08.

  	
  TAX EVENT REDEMPTION

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 11.09.

  	
  REGULATORY EVENT REDEMPTION

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TWELVE

  	
   

  
	
   

  	
   

  	
   

  
	
  SINKING FUNDS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 12.01.

  	
  APPLICABILITY OF THIS ARTICLE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 12.02.

  	
  SATISFACTION OF SINKING FUND PAYMENTS WITH
  SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 12.03.

  	
  REDEMPTION OF SECURITIES FOR SINKING FUND

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE THIRTEEN

  	
   

  
	
   

  	
   

  	
   

  
	
  SUBORDINATION OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.01.

  	
  SECURITIES SUBORDINATE TO CERTAIN
  CREDITORS; DEFINITION OF RELATIVE RIGHTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.02.

  	
  PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.03.

  	
  SUBORDINATED TRUSTEE TO EFFECTUATE
  SUBORDINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.04.

  	
  NO WAIVER OF SUBORDINATION PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.05.

  	
  NOTICE TO SUBORDINATED TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.06.

  	
  RELIANCE ON JUDICIAL ORDER OR CERTIFICATE
  OF LIQUIDATING AGENT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.07.

  	
  SUBORDINATED TRUSTEE NOT FIDUCIARY FOR
  CREDITORS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.08.

  	
  RIGHTS OF SUBORDINATED TRUSTEE AS CREDITOR;
  PRESERVATION OF SUBORDINATED TRUSTEE’S RIGHTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.09.

  	
  ARTICLE APPLICABLE TO PAYING AGENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 13.10.

  	
  CONVERSION OR EXCHANGE NOT DEEMED PAYMENT

  	
   

  

 

vi

 

	
  ARTICLE FOURTEEN

  	
   

  
	
   

  	
   

  	
   

  
	
  CONVERSION OR EXCHANGE OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.01.

  	
  APPLICABILITY OF ARTICLE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.02.

  	
  ELECTION TO CONVERT OR EXCHANGE; NOTICE TO
  SUBORDINATED TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.03.

  	
  NOTICE OF CONVERSION OR EXCHANGE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.04.

  	
  DEPOSIT OF PAYMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.05.

  	
  SURRENDER OF SECURITIES.

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.06.

  	
  ISSUANCE OF PREFERENCE SHARES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.07.

  	
  EFFECT OF CONVERSION OR EXCHANGE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.08.

  	
  VALIDITY OF PREFERENCE SHARES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.09.

  	
  LEGAL AND REGULATORY COMPLIANCE

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.10.

  	
  TAXES AND CHARGES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 14.11.

  	
  SUBORDINATED TRUSTEE NOT LIABLE

  	
   

  

 

vii

 

PRUDENTIAL SUBORDINATED INDENTURE

 

This is a
SUBORDINATED INDENTURE dated as of [•], 2004, among Prudential plc, a public
limited company duly organized and existing under the laws of England and
Wales, and having its principal office at Laurence Pountney Hill, London EC4R
0HH, England, (hereinafter called the “Issuer”), and Citibank, N.A., a national
banking association, duly incorporated and existing under the laws of the
United States of America and having its Corporate Trust Office at 111 Wall
Street, 14th Floor, New York, New York 10005, as Subordinated Trustee
(hereinafter called the “Subordinated Trustee”).

 

RECITALS OF THE ISSUER

 

The Issuer
deems it necessary to issue from time to time for its lawful purposes
subordinated securities (herein called the “Securities”) evidencing its
unsecured indebtedness and has duly authorized the execution and delivery of
this Subordinated Indenture to provide for the issuance from time to time of
the Securities, unlimited as to principal amount, to have such titles, to bear
such rates of interest, to mature at such time or times and to have such other
provisions as shall be established as hereinafter provided.

 

All things
necessary to make this Subordinated Indenture a valid agreement of the Issuer,
in accordance with its terms, have been done, and the Issuer proposes to do all
things necessary to make the Securities, when executed by the Issuer and
authenticated and delivered by the Subordinated Trustee hereunder and duly
issued by the Issuer, the valid obligations of the Issuer as hereinafter provided.

 

NOW THEREFORE, THIS SUBORDINATED 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 1.01.                             Definitions.

 

For all
purposes of this Subordinated Indenture and all Securities issued hereunder,
except as otherwise expressly provided herein or in one or more indentures
supplemental hereto or in an Officers’ Certificate pursuant to
Section 3.01, or unless the context otherwise requires:

 

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

 

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

 

(3)                                  all
accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles in the United
Kingdom, and the term “generally accepted accounting principles” with respect
to any computation

 

1

 

required or permitted hereunder
shall mean such accounting principles as are generally accepted in the United
Kingdom at the date or time of such computation; and

 

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

 

Certain terms,
used principally in Article Three and Article Six, are defined in
those Articles.

 

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

 

“ADR Custodian” means the custodian under
the ADR Deposit Agreement.

 

“ADR Deposit Agreement” means the deposit
agreement, dated as of July [•], 2004, between the Issuer,  Citibank, N.A., as depositary, and holders
from time to time of American Depositary Receipts issued thereunder.

 

“ADR Depositary” means the depositary under
the ADR Deposit Agreement.

 

“ADRs” means the American Depositary
Receipts issued pursuant to the ADR Deposit Agreement.

 

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

 

“Alternative Coupon Satisfaction Mechanism” means, with
respect to the Perpetual Subordinated Capital Securities, the procedure for
raising cash through the issuance of shares by which the Issuer may be required
or elect to satisfy a payment of Deferred Interest or a principal payment on
the Perpetual Subordinated Capital Securities, as and to the extent provided in
the applicable Board Resolution or supplemental indenture executed pursuant to
Section 3.01 hereof establishing the terms of such series of Perpetual
Subordinated Capital Securities.

 

“Assets” means the Issuer’s non-consolidated gross assets, as
shown in the Issuer’s latest published balance sheet, but adjusted for
contingencies and subsequent events, all in such manner as the Person or
Persons giving the relevant report under Section 13.01(b) may determine.

 

“Auditors” means the auditors for the time being of the
Issuer, or if there shall be joint auditors of the Issuer, any one or more of
such joint auditors.

 

2

 

“Authenticating Agent” means any Person authorized to
authenticate and deliver Securities in the name of, and as the agent of, the
Subordinated Trustee for the Securities of any series pursuant to
Section 3.14.

 

“Bankruptcy Law” means any bankruptcy, insolvency,
reorganization or other similar law of the United States or any State thereof,
England or Wales or any other applicable country or jurisdiction.

 

“Board of Directors” means the board of directors of the
Issuer or any duly authorized committee of that board or any director or
directors and/or officer or officers of the Issuer to whom that board or
committee shall have duly delegated its authority.

 

“Board Resolution” means (1) a copy of a resolution certified
by a director, the Secretary or a Deputy or Assistant Secretary of the Issuer,
to have been duly adopted by the Board of Directors or an authorized committee
thereof and to be in full force and effect on the date of such certification,
or (2) a certificate signed by the director or directors and/or officer or
officers to whom the Board of Directors of the Issuer shall have duly delegated
its authority, and, delivered to the Subordinated Trustee for the Securities of
any series.

 

“Business Day”, when used with respect to any particular
Place of Payment, means, unless otherwise specified in the Securities of a
series, each day, other than a Saturday or Sunday, which is not a day on which
commercial banking institutions in The City of New York, or in London, England
or in the applicable Place of Payment, or, in respect of any payment to be made
in a Foreign Currency, in the principal financial center of the country issuing
such Foreign Currency, are authorized or required by law, regulation or
executive order to close, and shall otherwise mean each day, other than a
Saturday or Sunday, which is not a day on which banking institutions, at the
place where any specified act pursuant to this Subordinated Indenture is to
occur, are authorized or required by law, regulation or executive order to
close.

 

“Calculation Agency Agreement” means the Calculation Agency
Agreement dated [•], 2004, as amended from time to time, among Cazenove &
Co. Ltd, as Calculation Agent, Citibank, N.A., as Subordinated Trustee and the
Issuer, in respect of a series of Perpetual Subordinated Capital Securities.

 

“Calculation Agent” means Cazenove & Co. Ltd, as
Calculation Agent under the Calculation Agency Agreement or such other Person
which may be appointed as Calculation Agent pursuant to the Calculation Agency
Agreement.

 

“Capital Regulations” means the rules and regulations of the
Financial Services Authority or any successor regulatory body that require the
Issuer or any of its EEA Insurance Subsidiaries to meet a Regulatory Capital
Requirement, including, without limitation, pursuant to the Directive or any
legislation, rules or regulations (whether having the force of law or
otherwise) in any state within the European Economic Area implementing the
Directive.

 

“Capital Security Default” has the meaning specified in
Section 5.03(b).

 

“Certificate of a Firm of Independent Public Accountants”
means a certificate signed by any firm of independent public accountants of
nationally recognized standing in the United Kingdom selected by the Issuer
which may include the Auditors of the Issuer.

 

3

 

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

 

“Component Currency” has the meaning specified in Section 3.11(h).

 

“Compulsory
Interest Payment Date” means, in respect of the Perpetual
Subordinated Capital Securities, any Interest Payment Date on which (i) the
Issuer satisfies the Solvency Condition, (ii) the Issuer is not prohibited from making such payment under
the terms of any Parity Security or Senior Security, and (iii) which is not an Optional
Interest Payment Date.

 

“Conversion Date” has the meaning specified in
Section 3.11(d).

 

“Conversion Event” means the unavailability of any Foreign
Currency or currency unit due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer.

 

“Corporate Trust Office” means the office of the Subordinated
Trustee for Securities of any series at which at any particular time its corporate
trust business shall be principally administered, which office of Citibank,
N.A., at the date of the execution of this Subordinated Indenture, is located
at 111 Wall Street, 14th Floor, New York, New York 10005.

 

“corporation” includes corporations, associations, companies
and business trusts.

 

“Currency Determination Agent”, with respect to Securities of
any series, means, unless otherwise specified in the Securities of a series, a
New York Clearing House bank designated pursuant to Section 3.01 or
Section 3.12.

 

“Currency Determination Agent’s Certificate” means a
certificate or facsimile thereof setting forth (i) the applicable Market
Exchange Rate and (ii) the Dollar, Foreign Currency or currency unit amounts of
principal (and premium, if any) and interest and Deferred Interest, if any (on
an aggregate basis and on the basis of a Security having the lowest
denomination principal amount determined in accordance with Section 3.02
in the relevant currency or currency unit), payable with respect to a Security
of any series on the basis of such Market Exchange Rate, signed by the Currency
Determination Agent.

 

“Dated Subordinated Debt Securities” means securities
evidencing unsecured subordinated indebtedness of the Issuer authenticated and
delivered under this Subordinated Indenture and that have a fixed Stated
Maturity or Redemption Date.

 

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

 

“Deferred Interest” has the meaning specified in
Section 3.07 and as may be further provided in the applicable Board
Resolution or supplemental indenture executed pursuant to Section 3.01
hereof establishing the terms of such series.

 

“Deferred Interest Payment” means any payment that the Issuer
makes in respect of Deferred Interest.

 

“Deferred Interest Payment Date” has the meaning specified in
Section 3.07.

 

4

 

“Deferred Principal Payment Date” has the meaning specified
in Section 3.07.

 

“Definitive Suspension” means, with respect to any series of
Perpetual Subordinated Capital Securities, the suspension of the Alternative
Coupon Satisfaction Mechanism with respect to such series as referred to in
Section 3.01(22) hereof and as further provided in the applicable Board
Resolution or supplemental indenture executed pursuant to Section 3.01
hereof establishing the terms of such series of Perpetual Subordinated Capital
Securities.

 

“Depositary” means, with respect to the Securities of any
series issuable or issued in the form of a global Security, the Person
designated as Depositary by the Issuer pursuant to Section 3.01 until a
successor Depositary shall have become such pursuant to the applicable
provisions of this Subordinated Indenture, and thereafter “Depositary” shall
mean or include each Person who is then a Depositary hereunder, and if at any
time there is more than one such Person, “Depositary” as used with respect to
the Securities of any such series shall mean each Depositary with respect to
the Securities of that series.

 

“Directive” means the 98/78/EC Directive of
the European Union.

 

“Discounted Security” means any Security which provides for
an amount (excluding any amounts attributable to accrued but unpaid interest
thereon) less than the principal amount thereof to be due and payable upon a declaration
of acceleration of the Maturity thereof pursuant to Section 5.02.

 

“Dollar Equivalent of the Currency Unit” has the meaning
specified in Section 3.11(g).

 

“Dollar Equivalent of the Foreign Currency” has the meaning
specified in Section 3.11(f).

 

“Dollars” and the sign “$” mean the
currency of the United States that as at the time of payment is legal tender
for the payment of public and private debts.

 

“EEA Insurance Subsidiary” means any Subsidiary of Prudential
plc engaged in the insurance business and regulated as such by a member state
of the European Economic Area.

 

“Election Date” has the meaning specified in
Section 3.11(h).

 

“euro” means the single currency of the participating member
states of the European Union that adopted the euro as their lawful currency
pursuant to the Treaty establishing the European Union (as amended from time to
time), and “participating member states” means those
member states of the European Union from time to time which adopt a single,
shared currency in the Third Stage, as defined and identified in European Union
legislation.

 

“European Economic Area” means the European Union together
with Norway, Liechtenstein and Iceland.

 

“Event Date” has the meaning specified in
Section 3.01(26).

 

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

 

“Excepted Person” has the meaning specified
in Section 14.10.

 

5

 

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

 

“Exchange Rate Officers’ Certificate” means a certificate or
facsimile thereof setting forth (i) the applicable Market Exchange Rate and
(ii) the Dollar, Foreign Currency or currency unit amounts of principal (and
premium, if any) and interest and Deferred Interest, if any (on an aggregate
basis and on the basis of a Security having the lowest denomination principal
amount determined in accordance with Section 3.02 in the relevant currency
or currency unit), payable with respect to a Security of any series on the
basis of such Market Exchange Rate, signed by the finance director or treasurer
of the Issuer.

 

“Financial Services Authority” means the United Kingdom
Financial Services Authority, or any successor regulatory body or such other
governmental authority in the United Kingdom (or if the Issuer becomes
domiciled in a jurisdiction other than the United Kingdom, in such other
jurisdiction) having primary supervisory authority with respect to the capital
requirements of the Issuer.

 

“Foreign Currency” means a currency issued and actively
maintained as a country’s or countries’ recognized unit of domestic exchange by
the government of any country other than the United States.

 

“Holder”, when used with respect to any Security, means the
Person in whose name a Security is registered in the Security Register.

 

“interest”, when used with respect to a Discounted Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.

 

“Interest Payment Date”, when used with respect to any Dated
Subordinated Debt Securities or Perpetual Subordinated Debt Securities, means
the Stated Maturity of an installment of interest on such Dated Subordinated
Debt Securities or Perpetual Subordinated Debt Securities and, when used with
respect to any Perpetual Subordinated Capital Securities, means each date defined
as an Interest Payment Date in accordance with the terms thereof; provided,
however, that, unless otherwise provided with respect to the Securities of any
series, if the Issuer does not pay any installment of interest on an Interest
Payment Date with respect to any Dated Subordinated Debt Securities or
Perpetual Subordinated Debt Securities, the obligation to make such payment and
such Interest Payment Date shall be deferred until the Deferred Interest Payment
Date (it being understood for the avoidance of doubt that any such deferral
shall take place only once with respect to any payment of interest).

 

“Interest Period” means, in respect of any series, the period
from and including each Interest Payment Date for such series (or, as the case
may be, the issue date of such series) up to but excluding the next (or first)
Interest Payment Date in respect of such series or such other period as is
specified to apply to such series in the applicable Board Resolution or
supplemental indenture establishing the terms of such series.

 

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

 

6

 

“Issuer Request” and “Issuer Order”
mean, respectively, a written request or order (a) signed in the name of the
Issuer by (i) any two of its chairman of the board, deputy chairman of the
board, group chief executive officer, treasurer, group finance director or
director group finance and risk, (ii) any one of the foregoing Persons together
with any group secretary or deputy group secretary of the Issuer, or (iii) any
two Persons designated by the Issuer in an Issuer Order previously delivered to
the Subordinated Trustee for Securities of any series and (b) delivered to the
Subordinated Trustee for Securities of any series in accordance with the
provisions of this Subordinated Indenture.

 

“Judgment Date” has the meaning specified in
Section 5.16.

 

“Junior Securities” means, with respect to the Dated
Subordinated Debt Securities, the Perpetual Subordinated Debt Securities or the
Perpetual Subordinated Capital Securities, the ordinary shares of the Issuer or
any other securities of the Issuer which rank, as regards to distributions on a
return of assets on a winding up of the Issuer or in respect of distributions or
payment of dividends or any other payments thereon, after such Securities, as
the case may be.

 

“Liabilities” means the total amount of the non-consolidated
gross liabilities of the Issuer as shown by the latest published balance sheet
of the Issuer but adjusted for contingencies and subsequent events in such
manner as the Person or Persons giving the relevant report under
Section 13.01(b) may determine.

 

“Market Disruption Event” means, with respect to the
Perpetual Subordinated Capital Securities, (i) the occurrence or existence of
any material suspension of or limitation imposed on trading or on settlement
procedures for transactions in the Issuer’s ordinary shares on the London Stock
Exchange (or other national securities exchange or designated offshore
securities market constituting the principal trading market for the Issuer’s
ordinary shares), or (ii) in the Issuer’s reasonable opinion, there has been a
substantial deterioration in the price and/or value of its ordinary shares or
circumstances are such as to prevent or to a material extent restrict the issue
or delivery of the ordinary shares to be issued in accordance with the
Alternative Coupon Satisfaction Mechanism or (iii) where, pursuant to
provisions of the Perpetual Subordinated Capital Securities, monies are
required to be converted from one currency upon sale of ordinary shares into
another currency in respect of any payment of Deferred Interest, the occurrence
of any event that makes it impracticable to effect such conversion.

 

“Market Exchange Rate” means, unless otherwise specified in
the Securities of a series, (i) for any conversion involving a currency unit on
the one hand and Dollars or any Foreign Currency on the other, the exchange
rate between the relevant currency unit and Dollars or such Foreign Currency
calculated by the method specified pursuant to Section 3.01 for the
Securities of the relevant series and (ii) for any conversion of Dollars into
any Foreign Currency or for any conversion of one Foreign Currency into Dollars
or another Foreign Currency, the spot rate at noon local time in the relevant
market at which, in accordance with normal banking procedures, the Dollars or
Foreign Currency into which conversion is being made could be purchased with
the Dollars or Foreign Currency from which conversion is being made from major
banks located in either New York City, New York, London, England, or any other
principal market for Dollars or such Foreign Currency, in each case determined
by the Issuer or the Currency Determination Agent.  In the event of the unavailability of any of
the exchange rates provided for in the foregoing clauses (i) and (ii), the
Issuer or the 

 

7

 

Currency Determination Agent
shall use, in its sole discretion and without liability on its part, such
quotation of the Federal Reserve Bank of New York as of the most recent
available date, or quotations from one or more major banks in New York City,
New York, London, England, or other principal market for such currency or
currency unit in question, or such other quotations as the Issuer or the
Currency Determination Agent shall deem appropriate.  Unless otherwise specified by the Issuer or
the Currency Determination Agent, if there is more than one market for dealing
in any currency or currency unit by reason of foreign exchange regulations or
otherwise, the market to be used in respect of such currency or currency unit
shall be that upon which a nonresident issuer of securities designated in such
currency or currency unit would purchase such currency or currency unit in
order to make payments in respect of such securities.  For purposes of this definition, a
“nonresident issuer” shall mean an issuer that is not a resident of the country
or countries that issue such currency or whose currencies are included in such
currency unit.

 

“Maturity”, when used with respect to any Security, means the
date, if any, on which the principal (or, if the context so requires, lesser
amount in the case of Discounted Securities) of (or premium, if any, on) that
Security becomes due and payable as therein or herein provided, whether at the
Stated Maturity or by declaration of acceleration, call for redemption, request
for redemption, repayment at the option of the holder, pursuant to any sinking
fund provisions or otherwise; provided, however,
that, unless otherwise provided with respect to the Dated Subordinated Debt
Securities of any series, if the Issuer does not pay all or any part of
principal (or any premium or interest thereon) at Maturity (other than
principal due by declaration of acceleration), the obligation to make such
payment and such Maturity shall be deferred until the Deferred Principal
Payment Date (it being understood for the avoidance of doubt that any such
deferral shall take place only once with respect to any payment).

 

“OECD” means the Organisation for Economic Co-operation and
Development.

 

“Officers’ Certificate” means a certificate of the Issuer
signed by (i) any two of its chairman of the board, deputy chairman of the
board, group chief executive officer, treasurer, group finance director or
director group finance and risk or (ii) any one of the foregoing Persons
together with any group secretary or deputy group secretary of the Issuer and
delivered in form and substance reasonably acceptable to the Subordinated
Trustee for the Securities of any series in accordance with the provisions of
this Subordinated Indenture.

 

“Opinion of Counsel” means a written opinion of outside legal
counsel, in form and substance and by counsel, both reasonably acceptable to
the Subordinated Trustee for the Securities of any series and who may be
regular outside counsel to the Issuer.

 

“Optional Interest Payment Date” means, with respect to any
Perpetual Subordinated Capital Securities, any Interest Payment Date on which
the Issuer may elect to defer the payment of interest, as and to the extent
provided in the applicable Board Resolution or supplemental indenture executed
pursuant to Section 3.01 hereof establishing the terms of such Perpetual
Subordinated Capital Securities.

 

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

 

8

 

(1)                                  Securities
which have been cancelled by the Subordinated Trustee for such Securities or
delivered to such Subordinated Trustee for cancellation;

 

(2)                                  Securities
or portions thereof for whose payment or redemption money in the necessary
amount and in the required currency or currency unit has been deposited with
the Subordinated Trustee for such Securities or any Paying Agent (other than
the Issuer, or any other obligor upon the Securities) in trust or set aside and
segregated in trust by the Issuer, or any other obligor upon the Securities (if
the Issuer or any other obligor upon the Securities shall act as its own Paying
Agent) for the Holders of such Securities; provided, however, that, if such
Securities or portions thereof are to be redeemed, notice of such redemption
has been duly given pursuant to this Subordinated Indenture, or provision
therefor satisfactory to such Subordinated Trustee has been made unless, in
each case, there is a default in such payment or redemption; and

 

(3)                                  Securities
which have been paid pursuant to Section 3.06 or in exchange for or in
lieu of which other Securities have been authenticated and delivered pursuant
to this Subordinated Indenture, other than any such Securities in respect of
which there shall have been presented proof reasonably satisfactory to the
Subordinated Trustee for such Securities that any such Securities are held by bona fide holders in due course;

 

provided,
however, that in determining whether the Holders of the
requisite aggregate principal amount of Outstanding Securities have given any
request, demand, authorization, direction, notice, consent or waiver or taken
any other action hereunder (a) 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, (i)
in determining whether the Subordinated Trustee for such Securities shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver or action, only Securities which a Responsible Officer
of such Subordinated Trustee actually knows to be so owned shall be so
disregarded and (ii) Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction
of such Subordinated 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 of such other obligor and (b)
the principal amount of a Discounted Security that shall be deemed to be
Outstanding for such purposes shall be equal to the amount of the principal
thereof that would be due and payable as of the date of such determination upon
a declaration of acceleration pursuant to Section 5.02.

 

“Parity Securities” means, with respect to the Dated
Subordinated Debt Securities, the Perpetual Subordinated Debt Securities or the
Perpetual Subordinated Capital Securities, the Issuer’s perpetual capital
instruments, preferred or preference shares or other securities issued directly
or indirectly by it ranking pari passu with
such Securities, as the case may be, as to rights to interest or dividend
payments and participation in the assets of the Issuer in the event of
liquidation or winding up of the Issuer.

 

“Paying Agent” means any Person authorized by the Issuer to
pay the principal of (and premium, if any, on), interest, Deferred Interest, if
any, or any additional amounts in respect of, any Securities on behalf of the
Issuer and shall include the Subordinated Trustee.

 

“Payment Default” has the meaning specified in
Section 5.03(a).

 

“Payment Event” has the meaning specified in
Section 5.03(d).

 

9

 

“Perpetual Subordinated Capital Securities” means securities
of the Issuer evidencing unsecured subordinated indebtedness of the Issuer
authenticated and delivered under this Subordinated Indenture, which have no
fixed Stated Maturity for the payment of principal or Redemption Date, to which
the subordination provisions of Section 13.01(e) apply, and which have
such further terms as are established pursuant to a Board Resolution or
supplemental indenture executed pursuant to Section 3.01 hereof.

 

“Perpetual Subordinated Debt Securities” means securities
evidencing unsecured subordinated indebtedness of the Issuer authenticated and
delivered under this Subordinated Indenture, which have no fixed Stated
Maturity for the payment of principal or Redemption Date, to which the
subordination provisions of Section 13.01(d) apply, and which have such
further terms as are established pursuant to a Board Resolution or supplemental
indenture executed pursuant to Section 3.01 hereof.

 

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

 

“Place of Payment”, when used with respect to the Securities
of any series, means the place or places where the principal of (and premium,
if any, on) and interest and Deferred Interest, if any, on, and any additional
amounts in respect of, the Securities of that series are payable, as contemplated
by Section 3.01.

 

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

 

“Preference Shares”  means an
authorized series of preference shares of the Issuer for which, if applicable
to a particular series of Securities, the Issuer may convert or exchange any
series of Securities.

 

“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 Subordinated Indenture; provided, however,
that, unless otherwise provided with respect to the Securities (other than
Perpetual Subordinated Capital Securities) of any series, if the Issuer does
not pay all or any part of principal (or any premium or interest thereon) on
the Redemption Date, the obligation to make such payment on such Redemption
Date shall be deferred until the Deferred Principal Payment Date (it being
understood for the avoidance of doubt that any such deferral shall take place
only once with respect to any payment).

 

“Redemption Price”, when used with respect to any Security to
be redeemed, means, unless otherwise specified in the Securities of a series,
the aggregate of the amounts payable on redemption being the principal amount
thereof plus accrued interest thereon, including any Deferred Interest.

 

“Registered Security” means any Security established pursuant
to Section 2.01 which is registered in the Security Register.

 

10

 

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

 

“Regulatory Capital Requirement” means any minimum or
notional margin of solvency or minimum regulatory capital or capital ratios
required for insurance companies, insurance holding companies or financial
groups by the Financial Services Authority or any successor regulatory body.

 

“Regulatory Event”, with respect to Dated Subordinated Debt
Securities, Perpetual Subordinated Debt Securities and Perpetual Subordinated
Capital Securities of any series, shall be deemed to have occurred if the Dated
Subordinated Debt Securities, Perpetual Subordinated Debt Securities and
Perpetual Subordinated Capital Securities of such series would not be of a kind
capable of counting as cover for the minimum or notional margin of solvency or
minimum capital or capital ratios required of the Issuer by any Regulatory
Capital Requirement as a result of any change to the Capital Regulations or the
application or official interpretation thereof at any relevant time.

 

“Responsible Officer”, when used with respect to the
Subordinated Trustee for any series of Securities, means any vice president
(whether or not designated by a number or a word or words added before or after
the title “vice president”), any senior trust officer or trust officer or any
other officer associated with the corporate trust department of such
Subordinated 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.

 

“Securities” means the Dated Subordinated Debt Securities,
the Perpetual Subordinated Debt Securities and the Perpetual Subordinated
Capital Securities.

 

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

 

“Senior Creditors” has with respect to (i) Dated Subordinated
Debt Securities, the meaning set forth in Section 13.01(c), (ii) Perpetual
Subordinated Debt Securities, the meaning specified in Section 13.01(d)
and (iii) Perpetual Subordinated Capital Securities, the meaning specified in
Section 13.01(e).

 

“Senior Securities” means the securities held by Senior
Creditors in their capacity as such.

 

A “series” of Securities means all Securities denoted as part
of the same series authorized by or pursuant to a particular Board Resolution
or a particular indenture supplemental hereto.

 

“Solvency Condition” means, when used with respect to any
series of Securities, that, at and immediately after the relevant time, the
Issuer is solvent by virtue of, (a) it being able to pay its debts to its
Senior Creditors (as such term is defined for such series of Securities) as
they fall due and (b) its total Assets exceeding its total Liabilities other
than Liabilities to persons that are not Senior Creditors (as such term is
defined for such series of Securities) by at least 4% or such other percentage
specified by the Financial Services Authority from time to time as the
Regulatory Capital Requirement (or such other percentage as may be specified by
the Issuer in the Board Resolution and Officers’ Certificate or supplemental
indenture establishing such series of Securities).  The determination of whether the Solvency
Condition has been satisfied shall be made in accordance with
Section 13.01(b) or as otherwise 

 

11

 

provided in the Board
Resolution or supplemental indenture establishing the terms of such series of
Securities.

 

“Special Record Date” for the payment of any Defaulted
Interest on the Securities of any series means a date fixed by the Issuer for
such series pursuant to Section 3.07.

 

“Specified Amount” has the meaning specified in
Section 3.11(h).

 

“Stated Maturity”, when used with respect to any Security or
any installment of principal thereof (or premium, if any, thereon) or interest,
if any, thereon, means the date, if any, specified in such Security as the
fixed date on which the principal of such Security (or premium, if any,
thereon) or such installment of principal (or premium, if any, thereon) or
interest is due and payable; provided, however, that, unless otherwise provided
with respect to the Securities of any series, if the Issuer does not pay all or
any part of principal (or any premium or interest thereon) on the Stated
Maturity, the obligation to make such payment and such Stated Maturity shall be
deferred until the Deferred Principal Payment Date (it being understood for the
avoidance of doubt that any such deferral shall take place only once with
respect to any payment).

 

“Stock Exchange”, unless specified otherwise with respect to
any particular series of Securities, means any stock exchange or securities
association upon which any Securities of that series are duly listed.

 

“Sterling” and the sign “£” mean United
Kingdom Pounds Sterling.

 

“Subordinated Indebtedness” means all indebtedness of the
Issuer which by its terms is subordinated in the event of the bankruptcy,
winding up or liquidation of the Issuer in right of payment to the claims of other
unsubordinated creditors of the Issuer and so that, for the purpose of this
definition, indebtedness shall include all liabilities, whether actual or
contingent, under guarantees or indemnities.

 

“Subordinated Indenture” means this instrument 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 and, unless
the context otherwise requires, shall include the terms of a particular series
of Securities established as contemplated by Section 3.01.

 

“Subordinated Trustee” means the Person named as the
“Subordinated Trustee” in the first paragraph of this instrument and, subject
to the provisions of Article Six hereof, shall also include its successors
and assigns as Subordinated Trustee hereunder. 
If there shall be at one time more than one Subordinated Trustee
hereunder, “Subordinated Trustee” shall mean each such Subordinated Trustee and
shall apply to each such Subordinated Trustee only with respect to those series
of Securities with respect to which it is serving as Subordinated Trustee.

 

“Substitute Date” has the meaning specified in
Section 5.16.

 

“Tax Call Event” has the meaning ascribed to it in a Board
Resolution or supplemental indenture, pursuant to Section 3.01.

 

“Tax Event” means a determination by the Issuer that:  (i) in making any interest payments or
Deferred Interest Payments on the Securities of any series, the Issuer has
paid, or will or would on the next Interest Payment Date be required to pay,
additional amounts required by Section 10.07 hereof; (ii) payments,
including Deferred Interest Payments, on the

 

12

 

next Interest Payment Date in
respect of any Perpetual Subordinated Capital Securities would be treated as
“distributions” within the meaning of Section 209 of the Income and
Corporation Taxes Act 1988 of the United Kingdom (as amended, re-enacted or
replaced); or (iii) as a result of a change in or amendment to the laws or regulations
of the United Kingdom or any political subdivision or any authority thereof or
therein having power to tax, including any treaty to which the United Kingdom
is a party, or any change in an application or official interpretation of those
laws or regulations, (including a change or amendment resulting from a holding
by a court or tribunal of competent jurisdiction), which change or amendment
becomes effective on or after the initial issue date of such series, the Issuer
would not be entitled to claim a deduction in computing its U.K. taxation
liabilities in respect of any interest payment (including any Deferred Interest
Payment) on the Perpetual Subordinated Capital Securities or the value of the
deduction to the Issuer would be materially reduced.

 

“Trust Indenture Act” means the U.S. Trust Indenture Act of
1939, as amended by the Trust Indenture Reform Act of 1990, as in force at the
date as of which this instrument was executed, except as provided in
Section 9.05.

 

“United Kingdom” and “U.K.” mean The
United Kingdom of Great Britain and Northern Ireland.

 

“United States” and “U.S.” mean,
unless otherwise specified with respect to the Securities of a series pursuant
to Section 3.01, the United States of America (including the States and
the District of Columbia), its territories, its possessions (which include at
the date of this Subordinated Indenture Puerto Rico, the U.S. Virgin Islands,
Guam, American Samoa, Wake Island and the Northern Mariana Islands) and other
areas subject to its jurisdiction.

 

“U.S. Government Obligations” means non-callable (i) direct
obligations (or certificates representing an ownership interest in such
obligations) of the United States for which its full faith and credit are
pledged or (ii) obligations of a Person controlled or supervised by, and acting
as an agency or instrumentality of, the United States, the timely payment of
which is unconditionally guaranteed as a full faith and credit obligation of
the United States.

 

“Valuation Date” has the meaning specified in
Section 3.11(c).

 

“Yield to Maturity”, when used with respect to any Discounted
Security, means the yield to maturity, if any, set forth in such Discounted
Security.

 

SECTION 1.02.                             Compliance Certificates and Opinions.

 

Upon any
application or request by the Issuer to the Subordinated Trustee for any series
of Securities to take any action under any provision of this Subordinated
Indenture, the Issuer shall furnish to such Subordinated Trustee an Officers’
Certificate stating that all conditions precedent, if any, provided for in this
Subordinated Indenture relating to the proposed action have been complied with,
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, provided 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 Subordinated Indenture
relating to such particular application or request the requirements hereof and
thereof may be satisfied by the same documents as contemplated by
Section 1.03 such that no duplicate certificate or opinion need be
furnished.

 

13

 

Every
certificate (other than certificates provided pursuant to Section 10.04) or
opinion with respect to compliance with a condition or covenant provided for in
this Subordinated Indenture shall include the following (or such other
statements or information as the Subordinated Trustee may reasonably request):

 

(1)                                  a
statement that each individual signing such certificate or opinion has read
such condition or covenant 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 condition or covenant has been
complied with; and

 

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

 

SECTION 1.03.                             Form of Documents Delivered to Subordinated Trustee.

 

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

 

Any
certificate or opinion of an officer of the Issuer 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
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 stating that the information with respect to
such factual matters is in the possession of the Issuer 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
Subordinated Indenture, they may, but need not, be consolidated and form one
instrument.

 

SECTION 1.04.                             Acts of Holders; Communication by Holders with Other Holders.

 

(a)                                  Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Subordinated Indenture to be given or taken by Holders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by an agent duly appointed in
writing.  Except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Subordinated Trustee for the appropriate
series of Securities

 

14

 

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, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Subordinated Indenture
and (subject to Section 6.01) conclusive in favor of the Subordinated Trustee
for the appropriate series of Securities, the Issuer and any agent of such
Subordinated Trustee or the Issuer, if made in the manner provided in this
Section.

 

The Issuer may
set at its discretion a record date for purposes of determining the identity of
Holders of Securities entitled to vote or consent to any action by vote or
consent authorized or permitted under this Subordinated Indenture, but the
Issuer shall have no obligation to do so. 
If not set by the Issuer prior to the first solicitation of Holders of
Securities of such series made by any Person in respect of any such action, or,
in the case of any such vote, prior to such vote, the record date for any such
action or vote shall be the 30th day prior to the first solicitation of such
vote or consent or, if later, the date of the most recent list of Holders
furnished to the Subordinated Trustee prior to such solicitation pursuant to
Section 7.01.  Upon the fixing of
such a record date, those persons who were Holders of Securities at such record
date (or their duly designated proxies), and only those persons, shall be
entitled with respect to such Securities to take such action by vote or consent
or to revoke any vote or consent previously given, whether or not such persons
continue to be Holders after such record date.

 

(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 the
certificate of any notary public, commissioner for oaths or other officer
authorized by law to take acknowledgements of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the execution
thereof.  Where such execution is by an
officer of a corporation or association or a member of a partnership, or an
official of a public or governmental body, on behalf of such corporation,
association, partnership or public or governmental body or by a fiduciary, such
certificate or affidavit shall also constitute sufficient proof of this
authority.

 

(c)                                  The
fact and date of the execution by any Person of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Subordinated Trustee for the appropriate series of
Securities deems sufficient.

 

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

 

(e)                                  In
determining whether the Holders of the requisite aggregate principal amount of
Outstanding Securities have given any request, demand, authorization,
direction, notice, consent or waiver under this Subordinated Indenture, the
principal amount of a Discounted Security that may be counted in making such
determination and that shall be deemed to be Outstanding for such purposes
shall be equal to the amount of the principal thereof that would be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.02 at the time the taking of such action by the Holders of such
requisite aggregate principal amount is evidenced to the Subordinated Trustee
for such Securities.

 

15

 

(f)                                    Any
request, demand, authorization, direction, notice, consent, waiver or other
action by 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 Subordinated Trustee for
such Securities, the Security Registrar, any Paying Agent or the Issuer, in
reliance thereon, whether or not notation of such action is made upon such
Security.

 

SECTION 1.05.                             Notices, Etc., to Subordinated Trustee or Issuer.

 

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

 

(1)                                  the
Subordinated Trustee for a series of Securities by any Holder or the Issuer
shall be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with such Subordinated Trustee at its Corporate Trust
Office, Attention: Citibank Agency and Trust; or

 

(2)                                  the
Issuer, by the Subordinated Trustee, or any Holder shall be sufficient for
every purpose hereunder (except as provided in clause (g) of Section 5.03)
if (a) addressed to Prudential plc, “Attention: Group Secretarial” and (b) in writing
and mailed, first class postage prepaid, or hand delivered, to the Issuer,
addressed to it at the address of its principal office specified in the first
paragraph of this Subordinated Indenture or at any other address previously
furnished in writing to such Subordinated Trustee by the Issuer or if sent by
facsimile transmission addressed to the Issuer at facsimile number +44 (0)20
7548 3739 or at any other facsimile number previously furnished in writing to
such Subordinated Trustee by the Issuer.

 

SECTION 1.06.                             Notice to Holders; Waiver.

 

Except as set
forth in a supplemental indenture or a Board Resolution pursuant to Section
3.01, where this Subordinated Indenture provides for notice to Holders of a
series of Registered Securities of any event, such notice shall be given
(unless otherwise expressly provided herein or in the Securities of a series)
in writing and mailed, first class postage prepaid, to each Holder, at his
address as it appears in the Security Register, not later than the latest date,
and not earlier than the earliest date, prescribed for the giving of such
notice.

 

In any case
where notice to Holders of Registered Securities is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder of a Registered Security shall affect the sufficiency of such
notice with respect to other Holders. 
Any notice mailed in the manner prescribed by this Subordinated
Indenture shall be deemed to have been given whether or not received by any particular
Holder.  In case by reason of the
suspension of regular mail service or by reason of any other cause it shall be
impracticable to give such notice to Holders of Registered Securities by mail,
then such notification as shall be made with the approval of the Subordinated
Trustee for such Securities shall constitute a sufficient notification for
every purpose hereunder.

 

Notwithstanding
the first paragraph of this Section 1.06, if the entire principal amount
of the Securities of a series or a portion thereof is represented by one or
more global Securities held by a Depositary, all notices with respect to such
principal amount or portion thereof, as the case may be, shall be sent to such
Depositary or its nominee, as the Holder,

 

16

 

and such Depositary will
communicate such notices to its participants in accordance with its standard
procedures.

 

Where this
Subordinated 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 Subordinated Trustee for such Securities, but such
filing shall not be a condition precedent to the validity of any action taken
in reliance upon such waiver.

 

A copy of any
notice or communication sent by the Issuer to any Holder of Securities shall
also be provided to the Subordinated Trustee at the same time in the manner
provided for to the Subordinated Trustee under Section 1.05.

 

SECTION 1.07.                             Conflict with Trust Indenture Act.

 

If any
provision of this Subordinated Indenture limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under the Trust Indenture
Act to be a part of and govern this Subordinated Indenture, the latter
provision shall control.  If any
provision of this Subordinated 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 Subordinated Indenture as so
modified or excluded, as the case may be.

 

SECTION 1.08.                             Effect of Headings and Table of Contents.

 

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

 

SECTION 1.09.                             Successors and Assigns.

 

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

 

SECTION 1.10.                             Separability Clause.

 

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

 

SECTION 1.11.                             Benefits of Subordinated Indenture.

 

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

 

SECTION 1.12.                             Governing Law.

 

This
Subordinated Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York, except as stated in
Section 2.01 and except for Section 13.01, which shall be governed by
and construed in accordance with the laws of England and Wales.

 

17

 

SECTION 1.13.                             Non-Business Day.

 

Unless
otherwise specified in the Securities of a series, in any case where any
Interest Payment Date, Redemption Date, Event Date or Stated Maturity of a
Security of any particular series shall not be a Business Day at any Place of
Payment with respect to Securities of that series, then (notwithstanding any
other provision of this Subordinated Indenture) payment of principal (or, if
the context so requires, lesser amount in the case of Discounted Securities) of
(and premium, if any, on) and interest and Deferred Interest, if any, with
respect to such Security and the exchange or conversion of such Security need
not be made or occur at such Place of Payment on such date, but may be made or
occur on the next succeeding Business Day at such Place of Payment with the
same force and effect as such payment, or conversion or exchange, had occurred
on the Interest Payment Date, Redemption Date, Event Date, as the case may be,
or at the Stated Maturity; provided that no interest shall accrue for the
period from and after such Interest Payment Date, Redemption Date, Event Date
or Stated Maturity, as the case may be; and provided further,
that if such next succeeding Business Day at any Place of Payment would fall in
the succeeding fiscal year of the Issuer, payment may be made in full or such
conversion or exchange may occur on the immediately preceding Business Day at
such Place of Payment with the same force and effect as if made on the Interest
Payment Date, Redemption Date, Event Date or Stated Maturity, as the case may
be.

 

SECTION 1.14.                             Immunity of Incorporators, Stockholders, Officers and Directors.

 

No recourse
shall be had for the payment of the principal of (or premium, if any, on), or
interest or Deferred Interest, if any, on any Security of any series, or for
any claim based thereon, or upon any obligation, covenant or agreement of this
Subordinated Indenture or any indenture supplemental hereto, or any Security,
or because of any indebtedness evidenced thereby, against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Issuer or of any predecessor or successor corporations thereto, either directly
or indirectly through the Issuer or any predecessor or successor corporations,
whether by virtue of any constitution, statute or rule of law or by the
enforcement of any assessment or penalty or otherwise; it being expressly
agreed and understood that this Subordinated Indenture and all the Securities
of each series are solely corporate obligations, and that no personal liability
whatsoever shall attach to, or is incurred by, any incorporator, stockholder,
officer or director, past, present or future, of the Issuer or of any
predecessor or successor corporations thereto, either directly or indirectly
through the Issuer or any such predecessor or successor corporations, because
of the incurring of the indebtedness hereby authorized or under or by reason of
any of the obligations, covenants or agreements contained in this Subordinated
Indenture or in any of the Securities of any series, as the case may be, or to
be implied herefrom or therefrom; and that all such personal liability is
hereby expressly released and waived as a condition of, and as part of the
consideration for, the execution of this Subordinated Indenture and the
issuance of the Securities of each series.

 

SECTION 1.15.                             Certain Matters Relating to Currencies.

 

Whenever any
action or Act is to be taken hereunder by the Holders of Securities denominated
in different currencies or currency units, then for purposes of determining the
principal amount of Securities held by such Holders, the aggregate principal
amount of the Securities denominated in a Foreign Currency or currency unit
shall be deemed to be that amount of Dollars that could be obtained for such
principal amount on the basis of a spot rate of exchange specified to the
Subordinated Trustee for such series in an Exchange Rate

 

18

 

Officers’ Certificate or a
Currency Determination Agent’s Certificate for such Foreign Currency or
currency unit into Dollars as of the date the taking of such action or Act by
the Holders of the requisite percentage in aggregate principal amount of the
Securities.

 

SECTION 1.16.                             Language of Notices, Etc.

 

Any request,
demand, authorization, direction, notice, consent, waiver or other action
required or permitted under this Subordinated Indenture shall be in the English
language, and any published notice may also be in an official language of the
country or province of publication.

 

SECTION 1.17.                             Appointment of Agent for Service.

 

By the
execution and delivery of this Subordinated Indenture, the Issuer designates
and appoints Jackson National Life Insurance Company at 1 Corporate Way,
Lansing, Michigan 48951, as its authorized agent upon which process may be
served in any suit or proceeding arising out of or relating to the Securities
or this Subordinated Indenture which may be instituted in any Federal or New
York State Court located in the Borough of Manhattan, City and State of New
York but for that purpose only, and agrees that service of process upon said
Jackson National Life Insurance Company, directed to the attention of Thomas J.
Meyer and written notice of said service given by the Person serving the same
to it, addressed as provided in Section 1.05, shall be deemed in every
respect effective service of process upon it in any such suit or proceeding in
any Federal or State court in such Borough, City and State.  The Issuer hereby submits (for the purposes
of any such suit or proceeding) to the jurisdiction of any such court in which
any such suit or proceeding is so instituted, and irrevocably waives, to the
fullest extent it may lawfully do so, any objection it may have now or
hereafter to the laying of the venue of any such suit, action or proceeding in
any such court and irrevocably waives, to the fullest extent it may lawfully do
so, any claim that any such suit, action or proceeding brought in any such
court has been brought in an inconvenient forum.  Such submission and waiver shall be
irrevocable so long as any of the Securities remain Outstanding and such
appointment shall be irrevocable until the appointment of a successor by the
Issuer and such successor’s acceptance of such appointment.  Upon such acceptance, the Issuer shall notify
the Subordinated Trustee of the name and address of such successor.  The Issuer further agrees to take any and all
action, including the execution and filing of any and all such documents and
instruments, as may be necessary to continue such designation and appointment
of said Jackson National Life Insurance Company or its successor in full force
and effect so long as any of the Securities shall be Outstanding.  The Subordinated Trustee shall not be
obligated and shall have no responsibility with respect to any failure by the
Issuer to take any such action.

 

The Issuer
agrees, to the fullest extent that it lawfully may do so, that final judgment
in any such suit, action or proceeding brought in such a court shall be conclusive
and binding upon the Issuer, and may be enforced in the courts of England and
Wales (or any other courts to the jurisdiction of which the Issuer is subject)
by a suit upon such judgment, provided that service of process is effected upon
the Issuer in the manner specified in the foregoing paragraph or as otherwise
permitted by law; provided, however, that the
Issuer does not waive, and the foregoing provisions of this sentence shall not
constitute or be deemed to constitute a waiver of, (i) any right to appeal any
such judgment, to seek any stay or otherwise to seek reconsideration or review
of any such judgment, (ii) any stay of execution or levy pending an appeal
from, or a suit, action or proceeding for reconsideration of, any

 

19

 

such judgment, or (iii) any
other right or remedy of the Issuer to the extent not expressly waived in
accordance with this Section 1.17.

 

Notwithstanding
the foregoing, any actions arising out of or relating to the Securities or this
Subordinated Indenture may be instituted by any party hereto and, subject to
the limitations set forth in Article Five of this Subordinated Indenture,
by the Holder of any Security in any competent court in England and Wales.

 

Nothing in
this Section shall affect the right of the Subordinated Trustee or any
Holder of any Security to serve process in any manner permitted by applicable
law or limit the right of the Subordinated Trustee or any Holder of any
Security to bring proceedings against the Issuer in the courts of any other
jurisdiction or jurisdictions.

 

SECTION 1.18.                             Rules by the Subordinated Trustee

 

The
Subordinated Trustee may make reasonable rules for action by or a meeting of
Holders.

 

ARTICLE TWO

SECURITY FORMS

 

SECTION 2.01.                             Forms of Securities.

 

The Registered
Securities of each series shall be in such form or forms as shall be
established by or pursuant to a Board Resolution or in an indenture
supplemental hereto, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Subordinated Indenture or any indenture supplemental hereto and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with any law, with any
rule or regulation made pursuant thereto, with any rules of any securities
exchange or any automated quotation system or to conform to usage, as may,
consistently herewith, be determined by the officers executing such Securities.  Such execution of such Securities shall be
conclusive evidence as regards the Issuer as to any such determination by the
Issuer.

 

Each Security
issued hereunder shall have endorsed thereon a statement in the following form
or in substantially the following form:

 

THE RIGHTS OF
THE HOLDER OF THIS SECURITY ARE, TO THE EXTENT AND IN THE MANNER SET FORTH IN
SECTION 13.01 OF THE SUBORDINATED INDENTURE HEREINAFTER REFERRED TO,
SUBORDINATED TO THE CLAIMS OF OTHER CREDITORS OF THE ISSUER AND THIS SECURITY IS
ISSUED SUBJECT TO THE PROVISIONS OF THAT SECTION 13.01, AND THE HOLDER OF
THIS SECURITY BY ACCEPTING THE SAME, AGREES TO AND SHALL BE BOUND BY SUCH
PROVISIONS.  THE PROVISIONS OF
SECTION 13.01 OF THE SUBORDINATED INDENTURE AND THE TERMS OF THIS
PARAGRAPH SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
ENGLAND AND WALES.

 

The definitive
Securities shall be printed, lithographed or engraved or produced by any
combination of these methods or may be produced in any other manner, all as
determined

 

20

 

by the officers executing such
Securities.  Such execution of such
definitive Securities shall be conclusive evidence as regards the Issuer as to
any such determination made by the Issuer.

 

SECTION 2.02.                             Form of Certificate of Authentication.

 

Unless
otherwise specified as contemplated by Section 3.01, the Certificate of
Authentication on all Securities shall be in substantially the following form:

 

“This is one
of the Securities of the series designated in, and referred to in, the
Subordinated Indenture described herein.

 

	
   

  	
  CITIBANK, N.A.

  
	
   

  	
  as Subordinated Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  

 

SECTION 2.03.                             Securities in Global Form.

 

If any
Security of a series is issuable in global form, such Security may provide that
it shall represent the aggregate amount of Outstanding Securities from time to
time endorsed thereon and may also provide that the aggregate amount of
Outstanding Securities represented thereby may from time to time be increased
or reduced to reflect exchanges.  Any
endorsement of a Security in global form to reflect the amount, or any increase
or decrease in the amount, of Outstanding Securities represented thereby shall
be made by the Subordinated Trustee or Security Registrar and in such manner as
shall be specified in such Security.  Any
instructions by the Issuer with respect to a Security in global form, after its
initial issuance, shall be in writing but need not comply with
Section 1.02.

 

Global
Securities may be issued in registered form.

 

Unless
otherwise specified in the Securities of a series, every global Registered
Security authenticated and delivered hereunder shall bear a legend in
substantially the following form:

 

THIS SECURITY
IS A GLOBAL SECURITY WITHIN THE MEANING OF THE SUBORDINATED INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST
COMPANY OR A NOMINEE THEREOF.  UNLESS AND
UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
REGISTERED FORM IN ACCORDANCE WITH THE TERMS HEREOF AND OF THE INDENTURE,
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE OR TO THE DEPOSITORY TRUST COMPANY OR A
SUCCESSOR THEREOF BY A NOMINEE OF THE DEPOSITORY TRUST COMPANY OR A SUCCESSOR
THEREOF AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
SUBORDINATED INDENTURE.

 

21

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, 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 ENTITY AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

ARTICLE THREE

THE SECURITIES

 

SECTION 3.01.                             Title; Payment and Terms.

 

The aggregate
principal amount of Securities which may be authenticated and delivered and
Outstanding under this Subordinated Indenture is unlimited.  The Securities may be issued up to the
aggregate principal amount of Securities from time to time authorized by or
pursuant to a Board Resolution of the Issuer.

 

The Securities
may be issued in one or more series. 
There shall be established in one or more Board Resolutions or pursuant
to authority granted by one or more Board Resolutions and, subject to
Section 3.03, set forth in, or determined in the manner provided in, an
Officers’ Certificate, or established in one or more indentures supplemental
hereto, prior to the issuance of Securities of any series any or all of the
following, as applicable (each of which, if so provided, may be determined from
time to time by the Issuer with respect to unissued Securities of the series
and set forth in such Securities of the series when issued from time to time):

 

(1)                                  whether
Securities of that series are to be Dated Subordinated Debt Securities,
Perpetual Subordinated Debt Securities or Perpetual Subordinated Capital
Securities;

 

(2)                                  the
title of the Securities of that series (which shall distinguish the Securities
of that series from all other series of Securities); if the Securities of that
series will be in bearer rather than registered form, the forms, procedures and
mechanisms to be employed in connection therewith; any limit upon the aggregate
principal amount of the Securities of that series which may be authenticated
and delivered under this Subordinated Indenture (except for Securities
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Securities of that series pursuant to
Section 3.04, 3.05, 3.06, 9.06 or 11.07 and except for any Securities
which, pursuant to Section 3.03, are deemed never to have been
authenticated and delivered hereunder);

 

(3)                                  the
percentage or percentages of principal amount at which the debt securities of
the series will be issued;

 

(4)                                  certain
dates or periods, including:  (a) the
original issue date or dates or periods during which the Securities of that
series may be issued; (b) the date or dates (or

 

22

 

manner of determining the same) on which, or the range of dates within
which, the principal of (and premium, if any, on) the Securities of that series
is payable; and (c) the record dates, if any, for the determination of Holders
of Securities of such series to whom such principal (and premium, if any) is
payable;

 

(5)                                  information
with regard to interest, including:  (a)
the rate or rates (or the manner of calculation thereof, including any
provisions for the increase or decrease of such rate or rates upon the
occurrence of specific events) at which the Securities of that series shall
bear interest (if any), or the discount, if any, at which any Discounted
Securities may be issued; (b) the date or dates from which such interest shall
accrue; (c) the Interest Payment Dates on which such interest shall be payable
(or manner of determining the same); (d) the Regular Record Date for the
interest payable on any Securities on any Interest Payment Date; and
(e) the manner in which such interest shall be paid (including whether
such interest may be paid in accordance with the Alternative Coupon
Satisfaction Mechanism);

 

(6)                                  the
place or places where, subject to the provisions of Section 10.02:  (a) the principal of (and premium, if any,
on) and interest or Deferred Interest, if any, on Securities of that series
shall be payable; (b) any Registered Securities of that series may be
surrendered for registration of transfer, any Securities of that series may be
surrendered for exchange; and (c) notices and demands to or upon the Issuer in
respect of the Securities of that series and this Subordinated Indenture may be
served;

 

(7)                                  the
terms and conditions, if any, upon which Securities of that series may be
redeemed, purchased or repaid in whole or in part, at the option of the Issuer
or otherwise, including the period or periods within which or manner of
determining the same, the price or prices at which or manner of determining the
same, and the currency or currency unit in which the Securities may be
redeemed;

 

(8)                                  the
obligation (which may be fixed or contingent upon events), if any, of the
Issuer to redeem, purchase or repay Securities of that series pursuant to any
sinking fund or analogous provisions or at the option of a Holder thereof, and
the period or periods within which or manner of determining the same, the price
or prices at which or manner of determining the same, the currency or currency
unit in which, and the terms and conditions upon which, Securities of that series
shall be redeemed, purchased or repaid, in whole or in part, pursuant to such
obligation;

 

(9)                                  the
minimum denomination or denominations in which any Registered Securities of
that series shall be issuable if other than integral multiples of $1,000;

 

(10)                            with
respect to Securities other than Perpetual Subordinated Debt Securities or
Perpetual Subordinated Capital Securities, if other than the principal amount
thereof, the portion of the principal amount of Securities of that series which
shall be payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 5.02;

 

(11)                            any
additional covenants or agreements with respect to Securities of that series;

 

(12)                            if
other than as set forth in this Subordinated Indenture, any Events of Default,
Payment Defaults, Capital Security Defaults and Payment Events (including the
Events of Default, Payment Defaults, Capital Security Defaults and Payment
Events described in Sections 5.01 and 5.03) and any covenants or agreements of
the Issuer with respect to the Securities of that series, whether or not such
Events of Default, Payment Defaults, Capital

 

23

 

Security Defaults or Payment Events or covenants or agreements are
consistent with the Events of Default, Payment Defaults, Capital Security
Defaults or Payment Events or covenants or agreements set forth herein;

 

(13)                            if
a Person other than Citibank, N.A. is to act as Subordinated Trustee for the
Securities of that series, the name and location of the Corporate Trust Office
of such Subordinated Trustee;

 

(14)                            if
other than Dollars, the currency or currency unit in which payment of the
principal of (and premium, if any, on) and interest or Deferred Interest, if
any, on the Securities of that series shall be made or in which the Securities
of that series shall be denominated and the particular provisions applicable
thereto in accordance with, in addition to or in lieu of the provisions of
Section 3.11;

 

(15)                            if
the principal of (and premium, if any, on) and interest and Deferred Interest,
if any, on the Securities of that series are to be payable, at the election of
the Issuer or a Holder thereof, in a currency or currency unit other than that
in which such Securities are denominated or stated to be payable, in accordance
with provisions in addition to, in lieu of or in accordance with the provisions
of Section 3.11, the period or periods within which (including the
Election Date), and the terms and conditions upon which, such election may be
made, and the time and manner of determining the exchange rate between the
currency and currency unit in which such Securities are denominated or stated
to be payable and the currency or currency unit in which such Securities are to
be so payable;

 

(16)                            the
designation of the original Currency Determination Agent, if any, and in what
circumstances a Currency Determination Agent’s Certificate or an Exchange Rate
Officers’ Certificate shall be delivered for Securities of that series;

 

(17)                            the
index, if any, used to determine the amount of payments of principal of (and
premium, if any, on) and interest and Deferred Interest, if any, on the
Securities of that series;

 

(18)                            if
other than as set forth in Section 4.01, provisions for the satisfaction
and discharge of this Subordinated Indenture with respect to the Securities of
that series;

 

(19)                            if
the amount of payments of principal of (and premium, if any, on) and interest
and Deferred Interest, if any, on the Securities of that series may be
determined, at the election of the Issuer or a Holder thereof, with reference
to an index based on a currency or currency unit other than that in which such
Securities are denominated or stated to be payable or any other index, the
manner in which such amounts shall be determined;

 

(20)                            the
date as of which any global Security representing Outstanding Securities of
that series shall be dated if other than the date of original issuance of the
first Security of that series to be issued;

 

(21)                            the
application, if any, of Sections 10.07 and 11.08 to the Securities of that
series;

 

(22)                            the
form of the Securities of that series (including the terms and conditions of
such Securities);

 

(23)                            whether
the Securities of the series shall be issued in whole or in part in the form of
a global Security or Securities and, in such case, the Depositary for such
global Security or Securities;

 

24

 

(24)                            whether
any legends shall be stamped or imprinted on all or a portion of the Securities
of such series, and the terms and conditions upon which any such legends may be
removed;

 

(25)                            in
the case of any series of Perpetual Subordinated Capital Securities, the
particular terms of such series, including those relating to the Optional
Interest Payment Dates, Alternative Coupon Satisfaction Mechanism, Definitive
Suspension, optional redemption, and such other terms relating to Deferred
Interest, Events of Default, Capital Security Defaults, Payment Events, Tax
Events, Tax Call Events, Regulatory Events, Senior Securities, Junior
Securities, Parity Securities and subordination;

 

(26)                            whether
the Securities of the series shall be convertible or exchangeable into
Preference Shares at the option of the Issuer pursuant to
Article Fourteen; the dates on which of such conversion or exchange may
occur the date upon which the Issuer opts to exchange or convert the Securities
being referred to as (the “Event Date”); and the nature of the Preference
Shares and any additional or other provisions relating to such conversion or exchange;
and

 

(27)                            any
other terms of that series (which terms shall be consistent with the provisions
of this Subordinated Indenture except as such terms are otherwise expressly
provided for in an applicable Board Resolution or supplemental indenture executed
hereunder with respect to such series).

 

All Securities
of any particular series shall be identical except as to authentication date,
public offering price, denomination and issue date except as may otherwise be
provided in or pursuant to such Board Resolutions and set forth in such
Officers’ Certificates relating thereto or provided in or pursuant to any
supplemental indenture hereto (provided that the Securities of a series shall
be fungible with all other Securities of such series).  The terms of such Securities may be
determined by the Issuer from time to time if so provided in or established
pursuant to the authority granted in the Board Resolutions.  All Securities of any one series need not be
issued at the same time, and unless otherwise provided, a series may be
reopened for issuance of additional Securities of such series.

 

If any of the
terms of the Securities of a series are established by action taken pursuant to
one or more Board Resolutions, a copy of an appropriate record of such action
shall be certified by an appropriate officer of the Issuer and delivered to the
Subordinated Trustee at or prior to the delivery of the Officers’ Certificate
setting forth the terms of such Securities.

 

Prior to the
delivery of a Security of any series in any such form to the Subordinated
Trustee for authentication, the Issuer shall deliver to the Subordinated
Trustee (and the Subordinated Trustee shall be fully protected in relying upon)
the following:

 

(1)                                  the
Board Resolution of the Issuer and, if applicable, the supplemental indenture
by or pursuant to which such form of Security to be endorsed thereon have been
approved;

 

(2)                                  an
Officers’ Certificate of the Issuer dated the date such certificate is
delivered to the Subordinated Trustee stating that all conditions precedent
provided for in this

 

25

 

Subordinated Indenture relating
to the authentication and delivery of such Securities in such form have been
complied with; and

 

(3)                                  an
Opinion of Counsel stating that each of the Securities when (a) completed by
appropriate insertions and executed and delivered by the Issuer to the
Subordinated Trustee for authentication in accordance with this Subordinated
Indenture, (b) authenticated (if appropriate) and delivered by the Subordinated
Trustee in accordance with this Subordinated Indenture within the authorization
as to aggregate principal amount established from time to time by the Board of
Directors of the Issuer and (c) sold in the manner specified in such Opinion of
Counsel, will be the valid, binding and enforceable obligations of the Issuer
subject to applicable bankruptcy, reorganization, insolvency, moratorium and
other laws relating to or affecting creditors’ rights generally, to general
equitable principles, to an implied covenant of good faith and fair dealing and
to such other qualifications as such counsel shall conclude do not materially
affect the rights of Holders of such Securities.

 

SECTION 3.02.                             Denominations and Currencies.

 

Unless
otherwise provided with respect to any series of Securities as contemplated by
Section 3.01, any Registered Securities of a series shall be issuable in
denominations of $1,000 and any integral multiple thereof.

 

SECTION 3.03.                             Execution, Authentication, Delivery and Dating.

 

The Securities
shall be executed on behalf of the Issuer by any two of its directors or by one
director and the group secretary of the Issuer. 
The signature of any of these officers on the Securities may be manual or
facsimile or, as and to the extent required by the Depositary, manual.

 

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

 

At any time
and from time to time after the execution and delivery of this Subordinated
Indenture, the Issuer may deliver Securities of any series as executed by the
Issuer to the Subordinated Trustee for the Securities of such series for
authentication, together with an Issuer Order for the authentication and
delivery of such Securities, and such Subordinated Trustee, in accordance with
such Issuer Order, shall authenticate and deliver such Securities.  If any Security shall be represented by a
global Security, then, for purposes of this Section and Section 3.04,
the notation of a beneficial owner’s interest therein upon original issuance of
such Security shall be deemed to be delivered in connection with the original
issuance of such beneficial owner’s interest in such global Security.  If all the Securities of any one series are
not to be issued at one time and if a Board Resolution or indenture
supplemental hereto relating to such Securities shall so permit, such Issuer
Order may set forth procedures acceptable to the Subordinated Trustee for the
issuance of such Securities, including without limitation, procedures with respect
to interest rate, Stated Maturity, if any, date of issuance and date from which
interest, if any, shall accrue.  Such
procedures may authorize authentication and delivery pursuant to oral or
electronic instruction from the Issuer or its duly authorized agent.

 

26

 

Notwithstanding
any contrary provision herein, if all Securities of a series are not to be
originally issued at one time, it shall not be necessary to deliver the Board
Resolution and/or indenture supplemental hereto, Officers’ Certificate and
Opinion of Counsel otherwise required pursuant to Sections 1.02 and 3.01 at or
prior to the time of authentication of each Security of such series if such
documents are delivered at or prior to the authentication upon original
issuance of the first Security of such series to be issued.

 

Each
Registered Security shall be dated the date of its authentication.

 

No Security
shall be entitled to any benefit under this Subordinated Indenture or be valid
or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by manual signature by the Subordinated Trustee for such Security or
in the name of any Authenticating Agent pursuant to Section 3.14, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.  Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered
hereunder but never issued and sold by the Issuer, and the Issuer shall deliver
such Security to the Subordinated Trustee for cancellation as provided in
Section 3.09, for all purposes of this Subordinated Indenture such Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Subordinated Indenture.

 

In case any
Securities shall have been authenticated, but not delivered, by the
Subordinated Trustee for such series then in office, any successor Subordinated
Trustee may adopt such authentication and deliver the Securities so
authenticated with the same effect as if such successor Subordinated Trustee
had itself authenticated such Securities.

 

Any global Security
shall, unless otherwise provided therein, be delivered to a Depositary
designated pursuant to Section 3.01. 
Each Depositary designated pursuant to Section 3.01 for a global
Security must at the time of its designation and at all times while it serves
as such Depositary be a clearing agency registered under the Exchange Act and
any other applicable statute or regulation.

 

The
Subordinated Trustee shall have the right to decline to authenticate and
deliver any Securities if the Subordinated Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Subordinated
Trustee in good faith shall determine that such action would expose the
Subordinated Trustee to personal liability to existing Holders or would affect
the Subordinated Trustee’s own rights, duties or immunities under the
Securities, this Indenture or otherwise in a manner which is not reasonably
acceptable to the Subordinated Trustee acting in good faith.

 

SECTION 3.04.                             Temporary Securities and Exchange of Securities.

 

Pending the
preparation of definitive Securities of any particular series, the Issuer may
execute, and upon an Issuer Order the Subordinated Trustee for the Securities
of such series shall authenticate and deliver, in the manner specified in Section 3.03,
temporary Securities which are printed, lithographed, typewritten, photocopied
or otherwise produced in any authorized denomination, with like terms and
conditions as the definitive Securities of the series in lieu of which they are
issued in registered form and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such

 

27

 

Securities may determine.  Such execution of such Securities shall be conclusive
evidence as regards the Issuer as to any such determination made by the Issuer.

 

If temporary
Securities of any particular series are issued, the Issuer will cause
definitive Securities of that series to be prepared without unreasonable
delay.  After the preparation of such
definitive Securities, the temporary Securities of such series shall be
exchangeable for such definitive Securities and of a like Stated Maturity, if
any, and with like terms and provisions upon surrender of the temporary Securities
of such series at the office or agency of the Issuer in a Place of Payment for
that series, without charge to the Holder. 
Upon surrender for cancellation of any one or more temporary Securities
of any particular series, the Issuer shall execute and (in accordance with an
Issuer Order delivered at or prior to the authentication of the first
definitive Security of such series) the Subordinated Trustee for the Securities
of such series shall authenticate and deliver in exchange therefor a like
principal amount of definitive Securities of authorized denominations of the
same series and of a like Stated Maturity, if any, and with like terms and
provisions.  Until exchanged as
hereinabove provided, the temporary Securities of any series shall in all
respects be entitled to the same benefits under this Subordinated Indenture as
definitive Securities of the same series with like terms and conditions, except
where specified therein with respect to certification requirements prior to
payment of interest in certain cases.

 

SECTION 3.05.                             Registration, Registration of Transfer and Exchange.

 

The Issuer
shall cause to be kept for the Registered Securities of each series a security
register (such security register or registers herein sometimes collectively
referred to as the “Security Register”) in which, subject to such reasonable
regulations as it may prescribe, the Issuer shall provide for the registration
of Registered Securities and of transfers of Registered Securities.  Unless and until otherwise determined by the
Issuer, the Subordinated Trustee shall act as Security Registrar and the
Security Register shall be kept at the Corporate Trust Office of the
Subordinated Trustee.  At all reasonable
times the Security Register shall be open for inspection by the Issuer and its
duly authorized agents.  The Issuer may
appoint co-Security Registrars, provided that at any given time there shall be
only one Security Register with respect to a series of Securities.

 

Upon surrender
for registration of transfer of any Registered Security of any particular
series at the office or agency of the Issuer in a Place of Payment for that
series, the Issuer shall execute, and upon an Issuer Order the Subordinated
Trustee for the Securities of each series shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Registered Securities of any authorized denominations, and of a like Stated
Maturity, if any, and of a like series and aggregate principal amount and with
like terms and conditions.

 

Except as set
forth below, at the option of the Holder, Registered Securities of any
particular series may be exchanged for other Registered Securities (and only
Registered Securities) of any authorized denominations and of a like Stated
Maturity, if any, and of a like series and aggregate principal amount and with
like terms and conditions, upon surrender of the Registered Securities to be
exchanged at such office or agency. 
Whenever any Securities are so surrendered for exchange, the Issuer
shall execute, and upon an Issuer Order the Subordinated Trustee for such
Securities shall authenticate and deliver the Securities which the Holder
making the exchange is entitled to receive.

 

28

 

Notwithstanding
any other provision of this Section or Section 3.04, unless and until
it is exchanged in whole or in part for Registered Securities in definitive
form, a global Security representing all or a portion of the Registered
Securities of a series may not be transferred except as a whole by the
Depositary for such series to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor Depositary for such series
or a nominee of such successor Depositary.

 

If at any time
the Depositary for Securities of a series in registered form notifies the
Issuer that it is unwilling or unable to continue as Depositary for the
Securities of such series or if at any time the Depositary for the Securities
for such series shall no longer be eligible under Section 3.03, the Issuer
shall appoint a successor Depositary with respect to the Securities for such
series.  If a successor Depositary for
the Securities of such series is not appointed by the Issuer within 120 days
after the Issuer receives such notice or becomes aware of such ineligibility,
the Issuer’s election pursuant to Section 3.01 shall no longer be
effective with respect to the Securities for such series and the Issuer will
execute, and the Subordinated Trustee, upon receipt of an Issuer Order from the
Issuer for the authentication and delivery of definitive Securities of such
series, will authenticate and deliver Securities of such series in definitive
form, in an aggregate principal amount equal to the principal amount of the
global Security or Securities representing such series in exchange for such
global Security or Securities.

 

The Issuer may
at any time and in its sole discretion determine that the Registered Securities
of any series issued in the form of one or more global Securities shall no
longer be represented by such global Security. 
In such event the Issuer will execute, and the Subordinated Trustee,
upon receipt of an Issuer Order from the Issuer for the authentication and
delivery of definitive Registered Securities of such series, will authenticate
and deliver Registered Securities of such series in definitive form in an
aggregate principal amount equal to the principal amount of the global Security
representing such series in exchange for such global Security.

 

If specified
by the Issuer pursuant to Section 3.01 with respect to a series of
Securities in registered form, the Depositary for such series of Securities may
surrender a global Security for such series of Securities in exchange in whole
or in part for Securities of such series of like tenor and terms, and in
definitive form, on such terms as are acceptable to the Issuer and such
Depositary.  Thereupon the Issuer shall
execute, and the Subordinated Trustee, upon an Issuer Order, shall authenticate
and deliver, without service charge, (i) to each Person specified by such
Depositary a new Security or Securities of the same series, of like tenor and
terms and of any authorized denomination as requested by such Person in
aggregate principal amount equal to and in exchange for such Person’s
beneficial interest in the global Security; and (ii) to such Depositary a new
global Security of like tenor and terms and in a denomination equal to the
difference, if any, between the principal amount of the surrendered global
Security and the aggregate principal amount of Securities delivered to Holders
thereof.

 

Upon the
exchange of a global Security for Securities in definitive form, such global
Security if so exchanged in its entirety shall, upon an Issuer Order, be
cancelled by the Subordinated Trustee. 
Registered Securities issued in exchange for a global Security pursuant
to this Section 3.05 shall be registered in such names and in such
authorized denominations as the Depositary for such global Security, pursuant
to instructions from its

 

29

 

direct or indirect participants
or otherwise, shall instruct the Subordinated Trustee in writing.  The Subordinated Trustee shall deliver, or
cause to be delivered, such Registered Security to the persons in whose names
such Securities are so requested.

 

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

 

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

 

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

 

The Issuer
shall not be required (i) to issue, register the transfer of or exchange
Securities of any series during a period beginning at the opening of business
15 days before the day of the mailing of a notice of redemption of Securities
of that series selected for redemption under Section 11.04 and ending at
the close of business on the day of mailing of the relevant notice of
redemption or (ii) to register the transfer of or exchange any Security so
selected for redemption as a whole or in part, except the unredeemed portion of
any Security being redeemed in part.

 

SECTION 3.06.                             Mutilated, Destroyed, Lost and Stolen Securities.

 

If (i) any
mutilated Security is surrendered to the Subordinated Trustee for such
Security, or the Issuer and the Subordinated Trustee for a Security receive
evidence to their satisfaction of the destruction, loss or theft of any
Security and (ii) there is delivered to the Issuer and the Subordinated Trustee
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Issuer or the Subordinated Trustee that such Security has been acquired by a
bona fide purchaser, the Issuer shall execute and upon its request the
Subordinated Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security or in exchange for such mutilated Security,
a new Security of the same series and in a like principal amount and of a like
Stated Maturity, if any, and with like terms and conditions and bearing a
number not contemporaneously outstanding.

 

In case any
such mutilated, destroyed, lost or stolen Security has become or is about to
become due and payable, the Issuer in its discretion may, instead of issuing a
new Security, pay such Security (without surrender thereof except in the case
of a mutilated Security) if the applicant for such payment shall furnish to the
Issuer and the Subordinated Trustee for such Security such security or
indemnity as may be required by them to save each of them harmless, and in case
of destruction, loss or theft, evidence satisfactory to the Issuer and such
Subordinated Trustee and any agent of any of them of the destruction, loss or
theft of such Security and the ownership thereof.

 

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

 

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

 

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

 

SECTION 3.07.                             Payment of Interest.

 

(a)                                  General.  Unless otherwise specified with respect to
the Securities of any series, interest, if any, on any Security which is due
and payable, and is punctually paid or duly provided for, on any Interest
Payment Date shall be paid, in the case of Registered Securities, to the Person
in whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest payment; provided, however, that interest,
if any, payable at Maturity will be payable to the Person to whom principal
shall be payable.

 

Pursuant to Section 3.01, the Issuer shall designate the manner in
which interest shall be paid (including whether such interest may be paid in
accordance with the Alternative Coupon Satisfaction Mechanism).

 

Unless
otherwise provided with respect to the Securities of any series, payment of
interest may be made at the option of the Issuer by check mailed or delivered
to the address of the Person entitled thereto as such address shall appear in
the Security Register or by transfer to a bank account maintained by the payee.

 

(b)                                 Payments
of Interest on Dated Subordinated Debt Securities or Perpetual Subordinated
Debt Securities.  Unless otherwise
provided in the Board Resolution or supplemental indenture pursuant to
Section 3.01 hereof establishing the terms of the particular series, if
the Issuer fails to pay an installment of interest on an Interest Payment Date
with respect to any Dated Subordinated Debt Securities or Perpetual
Subordinated Debt Securities, or does not pay all or any part of the principal
of (or premium, if any, on) any such Securities on the Stated Maturity, if any,
or any other date set for redemption, the obligation to make such payment on
such Interest Payment Date, Stated Maturity or other date set for redemption,
as the case may be, shall be deferred until: (i) in the case of a payment of
interest, the date upon which the Issuer pays a dividend on any class of its
share capital or the Issuer makes any payment on any series of Securities
ranking junior to or pari passu with such series of Dated Subordinated Debt
Securities or Perpetual Subordinated Debt Securities (a “Deferred Interest
Payment Date”) or, in the case of Dated Subordinated Debt Securities, the
earlier to occur of the Stated Maturity for the payment of principal or the
Deferred Principal Payment Date, as the case may be; and (ii) in the case of a
payment of principal (or premium, if any), the first Business Day after the
date that falls six months after such payment was originally due (a “Deferred
Principal Payment Date”).

 

Except as
otherwise provided in a supplemental indenture or Board Resolution pursuant to
Section 3.01 for the Securities of such series, no payment deferred in
accordance with the foregoing will accrue interest and no payment so deferred
shall be treated as due for any purpose until the Deferred Interest

 

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Payment Date or Deferred
Principal Payment Date, as the case may be. 
Accordingly, no such deferral will constitute a Payment Default, Capital
Security Default, Payment Event or an Event of Default under Section 5.03
hereof with respect to such Securities.

 

Unless
otherwise provided in the Board Resolution or supplemental indenture pursuant
to Section 3.01 hereof establishing the terms of a series of the
Securities, if the Issuer defers an interest payment with respect to any Dated
Subordinated Debt Securities or Perpetual Subordinated Debt Securities, as the
case may be, in accordance with the terms of this Subordinated Indenture
(including any Board Resolution or supplemental indenture pursuant to
Section 3.01 hereof establishing the terms of such series), then neither
the Issuer nor any entity the Issuer controls, directly or indirectly, shall be
permitted: (a) to declare or pay a dividend or distribution or make any other
payment on any Preference Shares, Parity Securities or on any Junior Securities
(other than (i) a final dividend declared by the Issuer with respect to its
ordinary shares prior to the date that the decision to defer such interest
payment is made or (ii) a payment made by one of the Issuer’s wholly-owned
subsidiaries to another wholly-owned subsidiary or directly to the Issuer); or
(b) to redeem, purchase or otherwise acquire any Preference Shares, Parity
Securities or any Junior Securities, in each case unless or until the interest
otherwise due and payable on the next succeeding Interest Payment Date in respect
of such Securities is duly set aside and provided for or paid in full.

 

For purposes
of the foregoing, the payment (or declaration of payment) of a dividend or
distribution on Preference Shares, Junior Securities and Parity Securities
shall be deemed to include the making of any interest, coupon or dividend
payment (or payment under any guarantee in respect thereof) and the redemption,
purchase or other acquisition of such securities (save where the funds used to
redeem, purchase or acquire those securities are derived from an issue of
Preference Shares, Junior Securities or Parity Securities (i) made at any time
within the six-month period prior to the time of such redemption, purchase or
acquisition, and (ii) with the same or junior ranking on a return of assets on
a winding up or in respect of a distribution or payment of interest, coupons or
dividends and/or any other amounts thereunder to those securities being
redeemed, purchased or acquired).  The
Subordinated Trustee shall be entitled to rely on an Officers’ Certificate as
to whether the redemption, purchase or acquisition falls within the exception
set out above and, if the Subordinated Trustee does so rely, such Officers’
Certificate shall, in the absence of clear error, be conclusive and binding on
the Issuer and the holders of the Securities.

 

(c)                                  Payments
of Interest on Perpetual Subordinated Capital Securities.  Unless otherwise provided in the Board
Resolution or supplemental indenture pursuant to Section 3.01 hereof
establishing the terms of a series of Perpetual Subordinated Capital
Securities, (i) interest on the Perpetual Capital Securities will be due and
payable on each Compulsory Interest Payment Date and (ii) any accrued interest
for an Interest Period on any Perpetual Subordinated Capital Securities of a
particular series which is not paid by the Issuer either (x) because the issuer
elects not to make a payment of interest on any Optional Interest Payment Date,
or (y) because the Issuer is prohibited from making a payment of interest under
the terms of any Parity Securities or Senior Securities or (z) because the
Solvency Condition is not so met on an Interest Payment Date, together with any
other accrued interest for previous Interest Periods in respect of such
Perpetual Subordinated Capital Securities which was not paid by the Issuer so
long as the same remains unpaid, shall constitute “Deferred Interest”.  Unless otherwise provided in the Board
Resolution or supplemental indenture pursuant to Section 3.01 hereof
establishing the terms of a series of Perpetual Subordinated Capital
Securities, Deferred Interest shall not itself bear interest and will be
payable only pursuant to the Alternative Coupon Satisfaction Mechanism provided
for in the Board

 

32

 

Resolution or supplemental indenture pursuant to Section 3.01
hereof, or in such other circumstances and in such manner as is set forth
therein.

 

Unless
otherwise provided in the Board Resolution or supplemental indenture pursuant
to Section 3.01 hereof establishing the terms of a series of Perpetual
Subordinated Capital Securities, if the Issuer defers an interest payment with
respect to any Perpetual Subordinated Capital Securities in accordance with the
terms of this Subordinated Indenture (including any Board Resolution or
supplemental indenture pursuant to Section 3.01 hereof establishing the
terms of such series), then neither the Issuer nor any entity the Issuer
controls, directly or indirectly, shall be permitted: (a) to declare or pay a
dividend or distribution or make any other payment on any Preference Shares,
Parity Securities or on any Junior Securities (other than (i) a final dividend
declared by the Issuer with respect to its ordinary shares prior to the date
that the decision to defer such interest payment is made or (ii) a payment made
by one of the Issuer’s wholly-owned subsidiaries to another wholly-owned
subsidiary or directly to the Issuer); or (b) to redeem, purchase or otherwise
acquire any Preference Shares, Parity Securities or any Junior Securities, in
each case unless or until the interest otherwise due and payable on the next
succeeding Interest Payment Date (but excluding Deferred Interest, if any) in
respect of such Securities is duly set aside and provided for or paid in full.

 

For purposes
of the foregoing, the payment (or declaration of payment) of a dividend or
distribution on Preference Shares, Junior Securities and Parity Securities
shall be deemed to include the making of any interest, coupon or dividend
payment (or payment under any guarantee in respect thereof) and the redemption,
purchase or other acquisition of such securities (save where the funds used to
redeem, purchase or acquire those securities are derived from an issue of
Preference Shares, Junior Securities or Parity Securities (i) made at any time
within the six-month period prior to the time of such redemption, purchase or
acquisition, and (ii) with the same or junior ranking on a return of assets on
a winding up or in respect of a distribution or payment of interest, coupons or
dividends and/or any other amounts thereunder to those securities being
redeemed, purchased or acquired).  The
Subordinated Trustee shall be entitled to rely on an Officers’ Certificate as
to whether the redemption, purchase or acquisition falls within the exception
set out above and, if the Subordinated Trustee does so rely, such Officers’
Certificate shall, in the absence of clear error, be conclusive and binding on
the Issuer and the holders of the Securities.

 

The Board Resolution
or supplemental indenture pursuant to Section 3.01 hereof establishing the
terms of each series of Perpetual Subordinated Capital Securities, shall set
forth additional matters with respect to Deferred Interest with respect to such
series, including: (a) the manner in which the Alternative Coupon Satisfaction
Mechanism will apply to such series; (b) the dates, times and manner in which
the Issuer will be obligated to satisfy any Deferred Interest; (c) the
consequences of the occurrence of a Market Disruption Event or a Definitive
Suspension; and (d) such other matters with respect to Deferred Interest as are
set forth therein.

 

(d)                                 Payment
of Defaulted Interest.  Any interest
(a) on any Dated Subordinated Debt Securities and the Perpetual Subordinated
Debt Securities of any particular series which is due and payable, but is not
punctually paid or duly provided for, on any Deferred Interest Payment Date or
(b) on any Perpetual Subordinated Capital Securities of any particular series
which is due and payable, but is not punctually paid or duly provided for, on
any Compulsory Interest Payment Date (herein called “Defaulted Interest”) shall
forthwith cease to be payable to the Holder on the relevant Regular Record Date
by virtue of having been such Holder, and

 

33

 

such Defaulted Interest may be paid by the Issuer, at its election in
each case, as provided in clause (1) or (2) below:

 

(1)                                  the
Issuer may elect to make payment of any Defaulted Interest to the Persons in
whose names any Registered Securities of that series (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner.  The Issuer shall
notify the Subordinated Trustee for such Securities of such series in writing
at least thirty days prior to the date of the proposed payment of the amount of
Defaulted Interest proposed to be paid on each Security of that series and the
date of the proposed payment, and at the same time the Issuer shall deposit
with such Subordinated Trustee an amount of money in the currency or currency
unit in which interest on the Securities of such series are payable (except as
otherwise specified pursuant to Section 3.01 for the Securities of such
series and except as provided in Sections 3.11(b), 3.11(d) and 3.11(e)), equal
to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to such Subordinated Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause provided. 
The Issuer shall fix a Special Record Date, and promptly give notice
thereof to the Subordinated Trustee, for the payment of such Defaulted Interest
which shall not be more than 15 days and not less than 10 days prior to the
date of the proposed payment.  The Issuer
or such Subordinated Trustee, in the name and at the expense of the Issuer,
shall cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be mailed, first-class postage prepaid, in the
case of Registered Securities, to each Holder of Registered Securities of that
series at his address as it appears in the Security Register no less than 7
days prior to such Special Record Date. 
Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such Defaulted
Interest shall be paid to the Persons in whose names any such Registered
Securities of that series (or their respective Predecessor Securities) are
registered on such Special Record Date and shall no longer be payable pursuant
to the following clause (2); or

 

(2)                                  the
Issuer may make payment of any Defaulted Interest on Securities of any
particular series in any other lawful manner not inconsistent with the
requirements of any Stock Exchange on which the Registered Securities may be
listed, and upon such notice as may be required by such Stock Exchange, unless,
after notice is given by the Issuer to the Subordinated Trustee for the
Securities of such series of such proposed manner of payment pursuant to this
clause, such manner of payment shall be deemed impracticable by such
Subordinated Trustee.

 

Subject to the
foregoing provisions of this Section and Section 3.05, each Security
delivered under this Subordinated Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.

 

(e)                                  Payment
of Interest on Deferred Interest.  To the extent provided for in the Board
Resolution or supplemental indenture pursuant to Section 3.01 hereof
establishing the terms of a particular series of Perpetual Subordinated Capital
Securities, a Redemption Date on which any Deferred Interest Payments are due
to be satisfied may be postponed following the occurrence of a Market
Disruption Event, or in other circumstances where the Issuer is otherwise not
able to raise sufficient funds through the Alternative Coupon Satisfaction

 

34

 

Mechanism to satisfy all
Deferred Interest Payments payable on such Redemption Date.  In such event, the Perpetual Subordinated
Capital Securities of such series will remain Outstanding and will continue to
accrue and pay interest in accordance with their terms, and such postponement
of the Redemption Date will not constitute a Capital Security Default.  In addition, to the extent set forth in such
Board Resolution or supplemental indenture interest will accrue on outstanding
Deferred Interest Payments that would otherwise have been satisfied on such
initially scheduled Redemption Date from (and including) such Redemption Date
to (but excluding) the date such Deferred Interest Payments are paid, at the
rate of interest applicable to such series of Perpetual Subordinated Capital
Securities.

 

SECTION 3.08.                             Persons Deemed Owners.

 

Prior to due
presentment of a Registered Security for registration of transfer, the Issuer
and the Subordinated Trustee and any agent of the Issuer or the Subordinated
Trustee may treat the Person in whose name any such Security is registered as
the owner of such Security for the purpose of receiving payment of principal of
(and premium, if any, on) and (subject to Section 3.07) interest and
Deferred Interest, if any, on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and none of the Issuer,
such Subordinated Trustee or any agent of the Issuer or such Subordinated
Trustee shall be affected by notice to the contrary.

 

None of the Issuer, the Subordinated Trustee, any Paying Agent or the
Security Registrar will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial ownership
interests of a global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.

 

SECTION 3.09.                             Cancellation.

 

Unless otherwise specified in the Securities of a series, all
Securities surrendered for payment, redemption, registration of transfer on an
exchange, or delivered in satisfaction of any sinking fund payment, shall, if
surrendered to any Person other than the Subordinated Trustee for such
Securities, be delivered to such Subordinated Trustee and shall be promptly
cancelled by it.  The Issuer may at any
time deliver to the Subordinated Trustee for Securities of a series for
cancellation any Securities previously authenticated and delivered hereunder
which the Issuer may have acquired in any manner whatsoever, and all Securities
so delivered shall be promptly cancelled by such Subordinated Trustee.  Notwithstanding any other provision of this
Subordinated Indenture to the contrary, in the case of a series, all the
Securities of which are not to be originally issued at one time, a Security of
such series shall not be deemed to have been Outstanding at any time hereunder
if and to the extent that, subsequent to the authentication and delivery
thereof, such Security is delivered to the Subordinated Trustee for such
Security for cancellation by the Issuer or any agent thereof upon the failure
of the original purchaser thereof to make payment therefor against delivery
thereof, and any Security so delivered to such Subordinated Trustee shall be
promptly cancelled by it.  No Securities
shall be authenticated in lieu of or in exchange for any Securities cancelled
as provided in this Section, except as expressly permitted by this Subordinated
Indenture.  All cancelled Securities held
by the Subordinated Trustee for such Securities shall be disposed of by the
Subordinated Trustee in accordance with its standard procedures and a
certificate of disposition evidencing such disposition of Securities shall be

 

35

 

provided to the Issuer by the Subordinated Trustee, unless by an Issuer
Order the Issuer shall direct that such cancelled Securities shall be returned
to it.  Global Securities shall not be
disposed of until exchanged in full for definitive Securities or until payment
thereon is made in full.

 

SECTION 3.10.                             Computation of Interest.

 

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

 

SECTION 3.11.                             Currency and Manner of Payments in Respect of Securities.

 

(a)                                  With
respect to Securities of any series not permitting the election provided for in
paragraph (b) below or the Holders of which have not made the election provided
for in paragraph (b) below, payment of the principal of (and premium, if any,
on) and interest and Deferred Interest, if any, on any Security of such series
will be made in the currency or currency unit in which such Security is
payable.

 

(b)                                 It
may be provided pursuant to Section 3.01 with respect to Securities of any
series that Holders shall have the option, subject to paragraphs (d) and (e)
below, to receive payments of principal of (or premium, if any, on) or interest
or Deferred Interest, if any, on such Securities in any of the currencies or
currency units which may be designated for such election by delivering to the
Subordinated Trustee for such series of Securities a written election with
signature guarantees and in form and substance satisfactory to such
Subordinated Trustee, not later than the close of business on the Election Date
immediately preceding the applicable payment date.  If a Holder so elects to receive such
payments in any such currency or currency unit, such election will remain in
effect for such Holder until changed by such Holder by written notice to the
Subordinated Trustee for such series of Securities (but any such change may be
made not later than the close of business on the Election Date immediately
preceding the next payment date to be effective for the payment to be made on
such payment date and no such change of election may be made with respect to
payments to be made on any Security of such series with respect to which an
Event of Default, Payment Default, Capital Security Default or Payment Event
has occurred and is continuing or notice of redemption has been given by the
Issuer pursuant to Article Eleven). 
In the event that any Holder makes any such election pursuant to the
preceding sentence, such election will not be effective as to any transferee of
such Holder and such transferee shall be paid in the currency or currency unit
indicated pursuant to paragraph (a) above unless such transferee makes an
election pursuant to the preceding sentence; provided,
however, that such election, if in effect while funds are on deposit
with respect to the Securities of such series as described in
Section 4.01(a)(1)(B), will be effective as to any transferee of such
Holder unless otherwise specified pursuant to Section 3.01 for the
Securities of such series.  Any Holder of
any such Security who shall not have delivered any such election to the
Subordinated Trustee of such series of Securities not later than the close of
business on the applicable Election Date will be paid the amount due on the
applicable payment date in the relevant currency or currency unit as provided
in paragraph (a) of this Section 3.11. 
In no case may a Holder of Securities of any series elect to receive
payments in any currency or currency unit as described in this Section 3.11(b)
following deposit of funds or U.S. Government Obligations with respect to the
Securities of such series as described in Section 4.01(a)(1)(B).  The Subordinated Trustee for each such series
of Securities shall notify the

 

36

 

Currency Determination Agent as soon as practicable after the Election
Date of the aggregate principal amount of Securities for which Holders have
made such written election.

 

(c)                                  If
the election referred to in paragraph (b) above has been provided for pursuant
to Section 3.01, then not later than the fourth Business Day after the
Regular Record Date for each payment date for Securities of any series, the
Currency Determination Agent will deliver to the Issuer a written notice
specifying, in the currency or currency unit in which Securities of such series
are payable, the respective aggregate amounts of principal of (and premium, if
any, on) and interest and Deferred Interest, if any, on the Securities to be
paid on such payment date, specifying the amounts in such currency or currency
unit so payable in respect of the Securities of such series as to which the
Holders thereof shall have elected to be paid in a currency or currency unit
other than that in which such series is denominated as provided in paragraph
(b) above.  If the election referred to
in paragraph (b) above has been provided for pursuant to Section 3.01 and
if at least one Holder has made such election, then, on the second Business Day
preceding such payment date the Issuer will deliver or cause to be delivered to
the Subordinated Trustee for such series of Securities an Exchange Rate
Officers’ Certificate or a Currency Determination Agent’s Certificate in
respect of the Dollar, Foreign Currency or currency unit payments to be made on
such payment date.  The Dollar, Foreign
Currency or currency unit amount receivable by Holders of Securities who have
elected payment in a currency or currency unit as provided in paragraph (b)
above shall, unless otherwise provided pursuant to Section 3.01, be
determined by the Issuer or the Currency Determination Agent on the basis of
the applicable Market Exchange Rate in effect on the third Business Day (the
“Valuation Date”) immediately preceding each payment date.

 

(d)                                 Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
if a Conversion Event occurs with respect to a Foreign Currency or any other
currency unit in which any of the Securities are denominated or payable other
than pursuant to an election provided for pursuant to paragraph (b) above, then
with respect to each date for the payment of principal of (and premium, if any,
on) and interest and Deferred Interest, if any, on the applicable Securities
denominated or payable in such Foreign Currency or such other currency unit
occurring after the last date on which such Foreign Currency or such other
currency unit was available (the “Conversion Date”), the Dollar shall be the
currency of payment for use on each such payment date.  The Dollar amount to be paid by the Issuer to
the Subordinated Trustee of each such series of Securities and with respect to
such payment date shall be the Dollar Equivalent of the Foreign Currency or, in
the case of a currency unit, the Dollar Equivalent of the Currency Unit, in
each case as determined by the Currency Determination Agent in the manner
provided in paragraph (f) or (g) below.

 

(e)                                  Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
if the Holder of a Security denominated in any currency or currency unit shall
have elected to be paid in another currency or currency unit as provided in
paragraph (b) above, and a Conversion Event occurs with respect to such elected
currency or currency unit, such Holder shall receive payment in the currency or
currency unit in which payment would have been made in the absence of such
election.  Unless otherwise specified for
Securities of a series pursuant to Section 3.01, if a Conversion Event
occurs with respect to the currency or currency unit in which payment would
have been made in the absence of such election, such Holder shall receive
payment in Dollars as provided in paragraph (d) of this Section 3.11 or,
in the case of a Conversion Event with respect to Dollars, in such currency or
currency units as the Trustee shall select.

 

37

 

(f)                                    Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
the “Dollar Equivalent of the Foreign Currency” shall be determined by the
Currency Determination Agent and shall be obtained for each subsequent payment
after the Conversion Date by converting the specified Foreign Currency into
Dollars at the Market Exchange Rate on the Conversion Date.

 

(g)                                 Unless
otherwise specified for Securities of a series pursuant to Section 3.01,
the “Dollar Equivalent of the Currency Unit” shall be determined by the
Currency Determination Agent and subject to the provisions of paragraph (h)
below shall be the sum of each amount obtained by converting the Specified
Amount of each Component Currency into Dollars at the Market Exchange Rate for
such Component Currency on the Valuation Date with respect to each payment.

 

(h)                                 For
purposes of this Section 3.11 the following terms shall have the following
meanings:

 

A “Component Currency” shall mean any
currency which, on the Conversion Date, was a component currency of the
relevant currency unit.

 

“Election Date” shall mean any date for
any series of Securities as specified pursuant to Section 3.01(14) by
which the written election referred to in Section 3.11(b) may be made,
such date to be not later than the Regular Record Date for the earliest payment
for which such election may be effective.

 

A “Specified Amount” of a Component
Currency shall mean the number of units of such Component Currency or fractions
thereof which were represented in the relevant currency unit on the Conversion
Date.  If after the Conversion Date the
official unit of any Component Currency is altered by way of combination or
subdivision, the Specified Amount of such Component Currency shall be divided
or multiplied in the same proportion.  If
after the Conversion Date two or more Component Currencies are consolidated
into a single currency, the respective Specified Amounts of such Component
Currencies shall be replaced by an amount in such single currency equal to the
sum of the respective Specified Amounts of such consolidated Component
Currencies expressed in such single currency, and such amount shall thereafter
be a Specified Amount and such single currency shall thereafter be a Component
Currency.  If after the Conversion Date
any Component Currency shall be divided into two or more currencies, the
Specified Amount of such Component Currency shall be replaced by amounts of
such two or more currencies, each of whose Dollar Equivalent at the Market
Exchange Rate on the date of such replacement shall be equal to the Dollar
Equivalent of the Specified Amount of such former Component Currency at the
Market Exchange Rate on such date divided by the number of currencies into
which such Component Currency was divided, and such amounts shall thereafter be
Specified Amounts and such currencies shall thereafter be Component
Currencies.  If, on or after the
Conversion Date of the relevant currency unit, a Conversion Event (other than
any event referred to above in this definition of “Specified Amount”) occurs
with respect to any Component Currency of such currency unit and is continuing
on the applicable Valuation Date, the Specified Amount of such Component
Currency shall, for purposes of calculating the Dollar Equivalent of the
Currency Unit, be converted into Dollars at the Market Exchange Rate in effect
on the Conversion Date of such Component Currency.

 

All decisions and determinations of the Currency Determination Agent
regarding the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent
of the Currency Unit, the

 

38

 

Market Exchange Rate and changes in the Specified Amounts as specified
above shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive for all purposes and irrevocably binding upon the Issuer
and the Subordinated Trustee for the appropriate series of Securities and all
Holders of such Securities denominated or payable in the relevant currency or
currency units.  The Currency
Determination Agent shall promptly give written notice to the Issuer and the
Subordinated Trustee for the appropriate series of Securities of any such
decision or determination.

 

In the event of a Conversion Event with respect to a Foreign Currency,
the Issuer, after learning thereof, will immediately give written notice
thereof to the Subordinated Trustee of the appropriate series of Securities and
the Currency Determination Agent (and the Subordinated Trustee will promptly
thereafter give notice in the manner provided in Section 1.06 to the
Holders) specifying the Conversion Date. 
In the event of a Conversion Event with respect to the euro or any other
currency unit in which Securities are denominated or payable, the Issuer, after
learning thereof, will immediately give written notice thereof to the
Subordinated Trustee of the appropriate series of Securities and the Currency
Determination Agent (and the Subordinated Trustee will promptly thereafter give
notice in the manner provided in Section 1.06 to the Holders) specifying
the Conversion Date and the Specified Amount of each Component Currency on the
Conversion Date.  In the event of any
subsequent change in any Component Currency as set forth in the definition of
Specified Amount above, the Issuer, after learning thereof, will similarly give
written notice to the Subordinated Trustee of the appropriate series of
Securities and the Currency Determination Agent.

 

The Subordinated Trustee of the appropriate series of Securities shall be
fully justified and protected in relying and acting upon information received
by it from the Issuer and the Currency Determination Agent and shall not
otherwise have any duty or obligation to determine such information
independently.

 

SECTION 3.12.                             Currency Determination Agent.

 

(a)                                  Unless
otherwise specified pursuant to Section 3.01, if and so long as the
Securities of any series (i) are denominated in a currency unit or a currency
other than Dollars or (ii) may be payable in a currency unit or a currency
other than Dollars, or so long as it is required under any other provision of
this Subordinated Indenture, then the Issuer will maintain with respect to each
such series of Securities, or as so required, a Currency Determination Agent.  The Issuer will cause the Currency
Determination Agent to make the necessary foreign exchange determinations at
the time and in the manner specified pursuant to Section 3.01 for the
purpose of determining the applicable rate of exchange and for the purpose of
converting the issued currency or currency unit into the applicable payment
currency or currency unit for the payment of principal (and premium, if any)
and interest and Deferred Interest, if any, pursuant to Section 3.11.

 

(b)                                 The
Issuer shall procure that no resignation of the Currency Determination Agent
and no appointment of a successor Currency Determination Agent pursuant to this
Section shall become effective until the acceptance of appointment by the
successor Currency Determination Agent as evidenced by a written instrument
delivered to the Issuer and the Subordinated Trustee of the appropriate series
of Securities accepting such appointment executed by the successor Currency
Determination Agent.

 

39

 

(c)                                  If
the Currency Determination Agent shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of the Currency
Determination Agent for any cause, with respect to the Securities of one or
more series, the Issuer, by a Board Resolution, shall promptly appoint a
successor Currency Determination Agent or Currency Determination Agents with
respect to the Securities of that or those series (it being understood that any
such successor Currency Determination Agent may be appointed with respect to
the Securities of one or more or all of such series and that at any time there
shall only be one Currency Determination Agent with respect to the Securities
of any particular series).

 

SECTION 3.13.                             Common Code, CUSIP or ISIN Numbers.

 

The Issuer in issuing any series of the Securities may use Common Code,
CUSIP or ISIN numbers, if then generally in use, and thereafter with respect to
such series, the Subordinated Trustee may use such numbers in any notice of
redemption with respect to such series; provided that
any such notice may state that no representation is made as to the correctness
of such numbers either as printed on the Securities or as contained in any
notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers.  The Issuer will promptly notify the
Subordinated Trustee of any change in the Common Code, CUSIP or ISIN numbers.

 

SECTION 3.14.                             Authenticating Agents.

 

From time to time the Subordinated Trustee for the Securities of any
series may, subject to its sole discretion, and shall, upon an Issuer Order
from the Issuer and for such period as such Issuer shall elect, appoint one or
more Authenticating Agents with respect to the Securities of such series, which
may include the Issuer or any Affiliate, with power to act in the name of the
Subordinated Trustee and subject to its discretion in the authentication and
delivery of Securities of such series in connection with transfers and
exchanges under Sections 3.04, 3.05, 3.06 and 11.07 as fully to all intents and
purposes as though such Authenticating Agent had been expressly authorized by
those Sections of this Subordinated Indenture to authenticate and deliver
Securities of such series.  For all
purposes of this Subordinated Indenture, the authentication and delivery of
such Securities of such series by an Authenticating Agent for such Securities pursuant
to this Section shall be deemed to be authentication and delivery of such
Securities “by the Subordinated Trustee” for the Securities of such
series.  Any such Authenticating Agent
shall (except in the case of the Issuer, an Affiliate or an officer or director
of the Issuer or an Affiliate) at all times be a corporation organized and
doing business under the laws of the United States, any State thereof or the
District of Columbia, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by Federal, State or District of Columbia
authority, as the case may be.  If such
corporation publishes reports of condition at least annually pursuant to law or
the requirements of such supervising or examining authority, then for the
purposes of this Section the combined capital and surplus of such
corporation 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 an Authenticating Agent for
any series of Securities shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

 

40

 

Any Authenticating Agent for any series of Securities may resign at any
time by giving written notice of resignation to the Subordinated Trustee for
such series and to the Issuer.  The
Subordinated Trustee for any series of Securities may at any time and shall,
upon an Issuer Request, terminate the appointment of any Authenticating Agent
by giving written notice of termination to such Authenticating Agent and to the
Issuer in the manner set forth in Section 1.05.  Upon receiving such a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent for
any series of Securities shall cease to be eligible under this Section, the
Subordinated Trustee for such series may and shall, upon an Issuer Request,
appoint a successor Authenticating Agent, shall give written notice of such
appointment to the Issuer and shall give written notice of such appointment to
all Holders of Securities of such series in the manner set forth in
Section 1.06.  Any successor
Authenticating Agent, upon acceptance of his appointment hereunder, shall
become vested with all the rights, powers and duties of his predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.  No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.

 

The Issuer agrees to pay to any corporation of which any director or
officer has been appointed as Authenticating Agent for such series from time to
time reasonable compensation for such services.

 

If an appointment with respect to one or more series of Securities is
made pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Subordinated Trustee’s certificate of authentication,
an alternate certificate of authentication substantially in the form specified
in Section 2.02.

 

ARTICLE FOUR

SATISFACTION AND DISCHARGE

 

SECTION 4.01.                             Satisfaction and Discharge of Securities of any Series.

 

(a)                                  The
Issuer shall be deemed to have satisfied and discharged the entire indebtedness
on all the Securities of any particular series and, so long as no Event of
Default, Payment Default, Capital Security Default or Payment Event shall be
continuing, the Subordinated Trustee for the Securities of such series, upon an
Issuer Request from the Issuer and at the expense of the Issuer, shall execute
proper instruments acknowledging satisfaction and discharge of such
indebtedness, when:

 

(1)                                  either:

 

(A)                              all
Securities of such series theretofore authenticated and delivered (other than
(i) any Securities of such series which have been mutilated, destroyed, lost or
stolen and which have been replaced or paid as provided in Section 3.06
and (ii) Securities of such series for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in the last
paragraph of Section 10.03) have been delivered to the Subordinated
Trustee for the Securities of such series for cancellation; or

 

(B)                                except
as otherwise specified pursuant to Section 3.01 for the Securities of such
series, with respect to all Outstanding Securities of such series

 

41

 

described in
(A) above not theretofore so delivered to the Subordinated Trustee for the
Securities of such series for cancellation:

 

(i)                                     the
Issuer has irrevocably deposited, or caused to be deposited, with the
Subordinated Trustee for the Securities of such series as trust funds in trust
an amount in the currency or currency unit in which the Securities of such
series are payable (except as otherwise specified pursuant to Section 3.01
for the Securities of such series and subject as to currency to Sections 3.11(b),
3.11(d) and 3.11(e), in which case the deposit to be made with respect to
Securities for which an election has occurred pursuant to Section 3.11(b)
or a Conversion Event has occurred as provided in Sections 3.11(d) and 3.11(e)
shall be made in the currency or currency unit in which such Securities are
payable as a result of such election or Conversion Event), sufficient (without
consideration of any reinvestment thereof) to pay and discharge the entire
indebtedness on all such Outstanding Securities of such series for unpaid
principal (and premium, if any) and interest and Deferred Interest, if any, to
the Stated Maturity, if any, or any Redemption Date as contemplated by
Section 4.02, as the case may be; or

 

(ii)                                  the
Issuer has deposited, or caused to be deposited, with such Subordinated Trustee
as obligations in trust such amount of U.S. Government Obligations as will, as
evidenced by a Certificate of a Firm of Independent Public Accountants
delivered to such Subordinated Trustee, together with the predetermined and
certain income to accrue thereon (without consideration of any reinvestment
thereof), be sufficient to pay and discharge when due the entire indebtedness
on all such Outstanding Securities of such series for unpaid principal (and
premium, if any) and interest and Deferred Interest, if any, to the Stated
Maturity, if any, or Redemption Date as contemplated by Section 4.02, as
the case may be;

 

(iii)                               the
Issuer has deposited, or caused to be deposited, with such Subordinated Trustee
in trust an amount equal to the amount referred to in clause (i) or (ii) in any
combination of currency or currency unit or U.S. Government Obligations and has
delivered a Certificate of a Firm of Independent Public Accountants to such
Subordinated Trustee verifying that such combination of funds and U.S.
Government Obligations will be sufficient to pay and discharge the entire
indebtedness on all Outstanding Securities of such series for unpaid principal
(and premium, if any) and interest and Deferred Interest, if any to the extent
provided for in a Board Resolution or supplemental indenture pursuant to
Section 3.01, to the Stated Maturity, if any, or any Redemption Date as
contemplated by Section 4.02, as the case may be, taking into account the
predetermined and certain income to accrue on such U.S. Government Obligations
(but without any consideration of any reinvestment thereof) and without taking
consideration of any reinvestment of any such funds; or

 

(iv)                              such
Securities are converted or exchanged for Preference Shares in accordance with
Article Fourteen and the applicable supplemental indenture for each series
of such Securities.

 

42

 

(2)                                  the
Issuer has paid or caused to be paid all other sums payable with respect to the
Securities of such series;

 

(3)                                  the
Issuer has delivered to such Subordinated 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 the entire
indebtedness on all Securities of such series have been complied with;

 

(4)                                  except
in the circumstances set out in Section 4.01(a)(1)(B)(iv), if the
Securities of such series are not to become due and payable at their Stated
Maturity, if any, within one year of the date of a deposit pursuant to
Section 4.01(a)(1)(B) or are not to be called for redemption within one
year of the date of such deposit under arrangements satisfactory to such
Subordinated Trustee as of the date of such deposit, then the Issuer shall have
given, not later than the date of such deposit, notice of such deposit to the
Holders of such Securities; and

 

(5)                                  except
in the circumstances set out in Section 4.01(a)(1)(B)(iv), if the
conditions set forth in Section 4.01(a)(1)(A) have not been satisfied, and
unless otherwise specified pursuant to Section 3.01 for the Securities of
such series, the Issuer has delivered to the Subordinated Trustee an Opinion of
Counsel to the effect that (A) the Issuer has received from, or there has been
published by, the Internal Revenue Service a ruling, or (B) since the date of
this Subordinated Indenture there has been a change in applicable United States
Federal income tax law, in either case to the effect that, and based upon which
such Opinion of Counsel shall confirm that, the beneficial owners of Securities
of such series will not recognize income, gain or loss for United States
Federal income tax purposes as a result of such deposit, satisfaction and
discharge and will be subject to United States Federal income tax on the same
amount and in the same manner and at the same time as would have been the case
if such deposit, satisfaction and discharge had not occurred.

 

(b)                                 Upon
the satisfaction of the conditions set forth in this Section 4.01 with respect
to all the Securities of any series, the terms and conditions of the Securities
of such series, including the terms and conditions with respect thereto set
forth in this Subordinated Indenture, as applicable, shall no longer be binding
upon, or applicable to, the Issuer and the Holder of the Securities of such
series shall look for payment only to the funds or obligations deposited with
the Subordinated Trustee pursuant to Section 4.01(a)(1)(B)(i)-(iii); provided, however, that in no event shall the Issuer be
discharged from (i) any payment obligations in respect of Securities of such
series which are deemed not to be Outstanding under clause (3) of the
definition thereof if such obligations continue to be valid obligations of the
Issuer under applicable law, (ii) any obligations under Sections 4.02(b), 6.07
and 6.10 and (iii) any obligations under Sections 3.04, 3.05 and 3.06 (except
that Securities of such series issued upon registration of transfer or exchange
or in lieu of mutilated, destroyed, lost or stolen Securities shall not be
obligations of the Issuer) and Sections 3.11, 5.16, 7.01 and 10.02; and
provided, further, that in the event a petition seeking relief under any
applicable Bankruptcy Law is filed and not discharged with respect to the Issuer
within 123 days after the deposit, the entire indebtedness on all Securities of
such series shall not be discharged, and in such event the Subordinated Trustee
shall return such deposited funds or obligations as it is then holding to the
Issuer upon an Issuer Request. 
Notwithstanding the satisfaction of the conditions set forth in this
Section 4.01 with respect to all the Securities of any series not
denominated in Dollars, upon the happening of any Conversion Event the
indebtedness represented by such Securities shall be converted from the
currency or currency unit in which

 

43

 

such Security is payable into Dollars at the Dollar Equivalent of the
Foreign Currency or the Dollar Equivalent of the Currency Unit and the Issuer
shall be obligated to make the payments in Dollars (or such other currency as
set out in Section 3.11(e)) required by Section 3.11(d) or 3.11(e) to
the extent that the Currency Determination Agent is unable to convert any Foreign
Currency or currency unit so deposited with the Subordinated Trustee pursuant
to Section 4.01(a)(1)(B)(i)-(iii) into the Dollar Equivalent of the
Foreign Currency or the Dollar Equivalent of the Currency Unit, as the case may
be.  The Subordinated Trustee for such
series of Securities shall return to the Issuer any non-converted funds or
securities in its possession after such payments have been made.

 

SECTION 4.02.                             Application of Trust Money.

 

(a)                                  All
money and obligations deposited with the Subordinated Trustee for any series of
Securities pursuant to Section 4.01 shall be held irrevocably in trust and
shall be made under the terms of an escrow trust agreement in form satisfactory
to such Subordinated Trustee.  Such money
and obligations shall be applied by such Subordinated Trustee, in accordance
with the provisions of the Securities, this Subordinated Indenture and such
escrow trust agreement, to the payment, either directly or through any Paying
Agent (including the Issuer acting as its own Paying Agent) as such
Subordinated Trustee may determine, to the Persons entitled thereto, of the
principal of (and premium, if any, on) and interest and Deferred Interest, if
any, on the Securities for the payment of which such money and obligations have
been deposited with such Subordinated Trustee. 
If Securities of any series are to be redeemed prior to their Stated
Maturity, whether pursuant to any optional redemption provisions or in
accordance with any mandatory sinking fund requirement, the Issuer shall make
such arrangements as are satisfactory to the Subordinated Trustee for any
series of Securities for the giving of notice of redemption by such
Subordinated Trustee in the name, and at the expense, of the Issuer.

 

(b)                                 The
Issuer shall pay and shall indemnify the Subordinated Trustee for any series of
Securities against any tax, fee or other charge imposed on or assessed against
U.S. Government Obligations deposited pursuant to Section 4.01 or the
interest and principal received in respect of such U.S. Government Obligations
other than any such tax, fee or other charge which by law is payable by or on
behalf of Holders.  The obligation of the
Issuer under this Section 4.02(b) shall be deemed to be an obligation of
the Issuer under Section 6.07(2).

 

(c)                                  Anything
in this Article Four to the contrary notwithstanding, the Subordinated
Trustee for any series of Securities shall deliver or pay to the Issuer from
time to time upon an Issuer Request any money or U.S. Government Obligations
held by it as provided in Section 4.01 which, as expressed in a
Certificate of a Firm of Independent Public Accountants delivered to such
Subordinated Trustee, are in excess of the amount thereof which would then have
been required to be deposited for the purpose for which such money or U.S. Government
Obligations were deposited or received.

 

SECTION 4.03.                             Satisfaction and Discharge of Subordinated Indenture.

 

Upon compliance by the Issuer with the provisions of Section 4.01
as to the satisfaction and discharge of each series of Securities issued
hereunder, and if the Issuer has paid or caused to be paid all other sums
payable under this Subordinated Indenture, this Subordinated Indenture shall
cease to be of any other effect (except as otherwise provided herein).  Upon an Issuer Request and receipt of an
Opinion of Counsel and an Officers’

 

44

 

Certificate complying with the provisions of Section 1.02, the
Subordinated Trustees for all series of Securities (at the expense of the
Issuer) shall execute proper instruments acknowledging satisfaction and
discharge of this Subordinated Indenture.

 

Notwithstanding the satisfaction and discharge of this Subordinated
Indenture, any obligations of the Issuer under Sections 3.04, 3.05, 3.06, 3.11,
4.02(b), 4.04, 5.16, 6.07, 6.10, 7.01 and 10.02 and the obligations of the
Subordinated Trustee for any series of Securities under Section 4.02 shall
survive.

 

SECTION 4.04.                             Reinstatement.

 

If the Subordinated Trustee for any series of Securities is unable to
apply any of the amounts (for purposes of this Section 4.04,  “Amounts”) or U.S. Government Obligations, as
the case may be, described in Section 4.01(a)(1)(B)(i), (ii) or (iii),
respectively, in accordance with the provisions of Section 4.01 by reason
of any legal proceeding or any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application,
each of the obligations of the Issuer under this Subordinated Indenture and the
Securities of such series shall be revived and reinstated as though no deposit
had occurred pursuant to Section 4.01 until such time as the Subordinated
Trustee for such series is permitted to apply all such Amounts or U.S.
Governmental Obligations, as the case may be, in accordance with the provisions
of Section 4.01; provided, however,
that if, due to the reinstatement of its rights or obligations hereunder, the
Issuer has made any payment of principal of (or premium, if any, on) or
interest or Deferred Interest, if any, on such Securities, the Issuer shall be
subrogated to the rights of the Holders of such Securities to receive payment
from such Amounts or U.S. Government Obligations, as the case may be, held by
the Subordinated Trustee for such series.

 

ARTICLE FIVE

REMEDIES

 

SECTION 5.01.                             Events of Default.

 

“Event of Default” wherever used herein
with respect to any particular series of Securities 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):

 

(a)                                  if
an order is made by a court of competent jurisdiction and is not successfully
appealed within 30 days of the making of such order, or an effective
shareholders’ resolution is validly adopted, for the winding up of the Issuer
in England and Wales (except in the case of winding-up solely for the purpose
of a reconstruction or amalgamation or substitution in place of the Issuer of a
successor in business in each case where the Securities remain outstanding and
are assumed by such successor in business on terms previously approved in
writing by the Holders of not less than 75% in aggregate principal amount of
the Outstanding Securities of that series); or

 

(b)                                 any
other events of default provided with respect to Securities of that series as
set forth in the Board Resolution or supplemental indenture pursuant to
Section 3.01 hereof establishing the terms of such series.

 

45

 

SECTION 5.02.                             Acceleration of Maturity; Rescission and Annulment.

 

(a)                                  Acceleration
of Maturity.  If an Event of Default
with respect to any particular series of Securities occurs and is continuing,
the Subordinated Trustee for the Securities of such series or the Holders of
not less than 25% in aggregate principal amount of the Outstanding Securities
of that series shall have the right to declare the principal amount of (including
premium, if any, on), or (in the case of Discounted Securities) such lesser
amount as may be provided for with respect to the Securities of such series
and, to the extent provided for in a Board Resolution or supplemental indenture
pursuant to Section 3.01 hereof, any accrued but unpaid interest payments
on, all the Outstanding Securities of that series to be due and payable
immediately, by a notice in writing to the Issuer (and to the Subordinated
Trustee if given by Holders).  Upon any
such declaration of acceleration such principal or such lesser amount, as the
case may be, including premium, if any, thereon, together with any accrued
interest, Deferred Interest (but only to the extent specifically provided for),
and all other amounts owing thereunder and hereunder (with respect to such
series of Securities), shall become immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived.

 

(b)                                 Recission
and Annulment by Holders.  At any
time after such a declaration of acceleration has been made, but before a
judgment or decree for payment of the money due has been obtained by the
Subordinated Trustee for the Securities of any series as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount
of the Outstanding Securities of that series, by written notice to the Issuer
and such Subordinated Trustee, may rescind and annul such declaration and its
consequences, provided:

 

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

 

(A)                              in
the currency or currency unit in which that series of Securities is payable
(except as otherwise specified pursuant to Section 3.01 for the Securities
of such series and except as provided in Sections 3.11(b), 3.11(d), and
3.11(e)), all overdue interest and, to the extent provided for a series of
Securities pursuant to Section 3.01, all Deferred Interest on all
Securities of that series;

 

(B)                                in
the currency or currency unit in which that series of Securities is payable
(except as provided in Sections 3.11(b), 3.11(d), and 3.11(e)), the principal
of (and premium, if any, on) any Securities of that series which have become
due otherwise than by such declaration of acceleration and interest thereon
from the date such principal became due at a rate per annum equal to the rate
borne by the Securities of such series (or, in the case of Discounted
Securities, the Securities’ Yield to Maturity), to the extent that the payment
of such interest shall be legally enforceable;

 

(C)                                in
the currency or currency unit in which that series of Securities is payable
(except as provided in Sections 3.11(b), 3.11(d), and 3.11(e)), to the extent
that payment of such interest is lawful (unless otherwise provided with respect
to a series of Securities pursuant to Section 3.01), interest upon overdue
interest at the rate or rates prescribed therefor in the Securities of such
series (or, unless otherwise specified pursuant to Section 3.01, in the
case of Discounted Securities, the Securities’ Yield to Maturity); and

 

46

 

(D)                               in
Dollars, all sums paid or advanced by the Subordinated Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of such
Subordinated Trustee, its agents and counsel and all other amounts then due to
such Subordinated Trustee under Section 6.07; and

 

(2)                                  all
Events of Default with respect to the Securities of such series have been cured
or remedied.

 

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

 

SECTION 5.03.                             Payment Defaults, Capital Security Defaults, Payment Events.

 

(a)                                  Payment
Defaults. Unless otherwise provided in the Board Resolution or supplemental
indenture pursuant to Section 3.01 establishing the terms of the
particular series, with respect to the Securities of any series of Dated
Subordinated Debt Securities or Perpetual Subordinated Debt Securities, a
“Payment Default” shall occur if the Issuer fails to pay, or set aside,
principal of (or premium, if any, on) or accrued interest, if any, on any such
Securities when due, and such failure continues for 14 days, provided that:

 

(1)                                  if
the Issuer does not pay or set aside for payment an installment of interest on
an Interest Payment Date with respect to any Dated Subordinated Debt Securities
or Perpetual Subordinated Debt Securities, or

 

(2)                                  the
Issuer does not pay or set aside for payment all or any part of the principal
of (or premium, if any, on) any such Subordinated Debt Securities on the Stated
Maturity (if any) or any Redemption Date,

 

the failure to
make such payment shall not constitute a “Payment Default”
and the obligation to make such payment shall be deferred until (i) in the case
of payment of interest, the applicable Deferred Interest Payment Date and (ii)
in the case of a payment of principal (or premium, if any), the Deferred
Principal Payment Date.

 

(b)                                 Capital
Security Defaults.  Unless otherwise
provided in the Board Resolution or supplemental indenture pursuant to
Section 3.01 establishing the terms of the particular series of Perpetual
Subordinated Capital Securities, a “Capital Security Default”
shall occur if:

 

(1)                                  the
Issuer fails to pay or set aside for payment the amount due to satisfy any interest
payment on a Compulsory Interest Payment Date, and such failure continues for a
period of 14 days; or

 

(2)                                  the
Issuer fails to pay or set aside a sum to provide for payment of the principal
amount, or fails to pay or set aside a sum to provide for payment of any
accrued but unpaid interest and any Deferred Interest on the date fixed for
redemption of such series and such failure continues for a period of 14 days.

 

(c)                                  Proceedings
upon Occurrence of a Payment Default or Capital Security Default.  Unless otherwise provided in the Board
Resolution or supplemental indenture pursuant to Section 3.01 establishing
the terms of the particular series, if a Payment Default (with respect to
Securities of any series of Dated Subordinated Debt Securities or Perpetual

 

47

 

Subordinated Debt Securities), or a Capital Security Default (with
respect to any series of Perpetual Subordinated Capital Securities), occurs and
is continuing, the Subordinated Trustee for the Securities of such series may
in its discretion commence (1) a proceeding in England and Wales (but not
elsewhere) for the winding up of the Issuer or (2) a judicial proceeding for
the collection of the sums so due and unpaid; provided that the Subordinated Trustee
may not declare the principal amount of any such Securities to be due and
payable.

 

(d)                                 Payment
Events.  Unless otherwise provided in
the Board Resolution or supplemental indenture pursuant to Section 3.01
establishing the terms of the particular series of Securities, if the Issuer
fails to pay the amount due to satisfy any principal or interest payment that
would have become due with respect to such Securities but for the Solvency
Condition not being satisfied, such failure continues for fourteen days and the
Solvency Condition is not satisfied at the end of such fourteen-day period,
such failure will not constitute a “Payment Default” or a “Capital Security
Default”, as the case may be, but instead will constitute a “Payment Event”,
together with any other Payment Event with respect to any other series of
Securities.

 

(e)                                  Certain
Limitations.  It shall not be a
Payment Event, Payment Default or Capital Security Default if such sums were
not paid in order to comply with a statute, regulation or order of any court of
competent jurisdiction. Where there is doubt as to the validity or
applicability of any such statute, regulation or order, it shall not be a
Payment Event, Payment Default or Capital Security Default if the Issuer acts
on the advice given to it and to the Subordinated Trustee, in the form of an
Opinion of Counsel acceptable to the Subordinated Trustee. However, the Issuer
shall take action, including proceedings for a court declaration, to resolve
the doubt, if counsel to the Issuer advises that the action is appropriate and
reasonable. In this case, the Issuer shall proceed with the action promptly and
be bound by any final resolution of the doubt. If such resolution is a
determination that the Issuer can make the relevant payment without violating
any statute, regulation or order then the payment shall become due and payable
immediately after the Issuer has been informed of the determination.

 

(f)                                    Proceeding
upon the Occurrence of a Payment Event. 
Unless otherwise provided in the Board Resolution or supplemental
indenture pursuant to Section 3.01 establishing the terms of the
particular series, if a Payment Event with respect to a series of Perpetual
Subordinated Debt Securities or Perpetual Subordinated Capital Securities
occurs and is continuing, the Subordinated Trustee may institute proceedings in
England and Wales (but not elsewhere) for the winding up of the Issuer, but may
not pursue any other legal remedy, including a judicial proceedings for the
collection of the sums so due and unpaid.

 

(g)                                 Waiver
of Certain Rights.  The Subordinated
Trustee for the Securities of a series waives on behalf of the Holders of such
Securities, and the Holder of any Security by his acceptance thereof will be
deemed to have waived, any right of set-off or counterclaim that such Holders
might otherwise have against the Issuer as the case may be, whether prior to or
in any such bankruptcy or winding up as referred to in this Section 5.03.
Notwithstanding the preceding sentence, if any of the rights and claims of any
Holder are discharged by set-off, such Holder will immediately pay an amount
equal to the amount of such discharge to the Issuer or, if applicable, the
liquidator or trustee or receiver in bankruptcy of the Issuer, and until such
time as payment is made will hold a sum equal to such amount in trust for the
Issuer or, if applicable, the liquidator or trustee or receiver in

 

48

 

bankruptcy of the Issuer. Accordingly, such discharge will be deemed
not to have taken place.

 

(h)                                 Certain
Other Proceedings.  If the Issuer
fails to perform or observe any of its respective obligations or covenants
under the Securities of any particular series or the Subordinated Indenture
(other than any obligation or covenant (1) with respect to the payment of any
principal, interest, or Deferred Interest on such Securities or (2) which has
expressly been included in this Subordinated Indenture solely for the benefit
of Securities other than Securities of such a series) and such failure
continues for a period of 30 days after the date on which there has been given,
by registered or certified mail, to the Issuer by the Subordinated Trustee or
to the Issuer and the Subordinated Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of such a series a
written notice specifying such default or breach and requiring it to be
remedied, then the Subordinated Trustee or the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of such a series may
institute such proceedings or take such other actions as they shall determine
in their sole discretion to enforce such obligation or covenant; provided that
the Issuer shall not as a consequence of such proceedings or other actions be
obligated to pay any sum or sums representing or measured by reference to the
principal, premium, if any, or interest (including Deferred Interest) in
respect of any such Securities sooner than the same would otherwise have been
due and payable by the Issuer.

 

SECTION 5.04.                             Subordinated 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 relating to the Issuer or any other obligor upon the
Securities of any series or the property of the Issuer or of such other obligor
or their creditors, the Subordinated Trustee for the Securities of such series
(irrespective of whether the principal (or lesser amount in the case of
Discounted Securities) of any Security of such series shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether such Subordinated Trustee shall have made any demand on the Issuer for
the payment of overdue principal, interest, or Deferred Interest (if the same
has not been paid on the date on which the same shall have become due and
payable as provided for in the Board Resolution or supplemental indenture
pursuant to Section 3.01) shall be entitled and empowered, by intervention
in such proceeding or otherwise:

 

(1)                                  to
file and prove a claim for the whole amount of principal (or lesser amount in
the case of Discounted Securities) (and premium, if any) and interest, Deferred
Interest, if any, owing and unpaid in respect of the Securities of such series
and to file such other papers or documents as may be necessary or advisable in
order to have the claims of such Subordinated Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of such
Subordinated Trustee, its agents and counsel and all other amounts due to such
Subordinated Trustee under Section 6.07) and of the Holders of the
Securities of such series allowed in such judicial proceeding;

 

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

 

(3)                                  unless
prohibited by law or applicable regulations, to vote on behalf of the Holders
of the Securities of such series in any election of a trustee in bankruptcy,
liquidator or other persons performing similar functions;

 

49

 

and any receiver,
assignee, trustee, liquidator, sequestrator (or other similar official) in any
such judicial proceeding is hereby authorized by each Holder of Securities to
make such payments to such Subordinated Trustee, and in the event that such
Subordinated Trustee shall consent to the making of such payments directly to
the Holders of Securities, to pay to such Subordinated Trustee any amount due
to it for the reasonable compensation, expenses, disbursements and advances of
such Subordinated Trustee, its agents and counsel and any other amounts due
such Subordinated Trustee under Section 6.07.

 

Nothing herein contained shall be deemed to authorize the Subordinated
Trustee for the Securities of any series to authorize or consent to or accept
or adopt on behalf of any Holder of a Security any plan of reorganization,
arrangement, adjustment or composition affecting the Securities of such series
or the rights of any Holder thereof, or to authorize the Subordinated Trustee
for the Securities of any series to vote in respect of the claim of any Holder
in any such proceeding, except as aforesaid, for the election of a trustee in
bankruptcy or other person performing similar functions.

 

SECTION 5.05.                             Subordinated Trustee May Enforce Claims Without Possession of
Securities.

 

All rights of action and claims under this Subordinated Indenture or
the Securities of any series may be prosecuted and enforced by the Subordinated
Trustee for the Securities of any series without the possession of any of the
Securities of such series or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by such Subordinated Trustee shall
be brought in its own name as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of such Subordinated Trustee, its agents
and counsel and all other amounts due to such Subordinated Trustee under
Section 6.07, be for the ratable benefit of the Holders of the Securities
of such series in respect of which such judgment has been recovered.

 

SECTION 5.06.                             Application of Money Collected.

 

Subject to Article Thirteen, any money collected by the
Subordinated Trustee for the Securities of any series pursuant to this
Article with respect to the Securities of such series shall be applied in
the following order, at the date or dates fixed by such Subordinated Trustee
and, in case of the distribution of such money on account of principal (or
lesser amount in the case of Discounted Securities) (or premium, if any) or
interest or Deferred Interest, if any, upon presentation of the Securities of
such series 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 such Subordinated Trustee
under Section 6.07;

 

Second: To the payment of the amounts then due and unpaid upon the
Securities of such series for principal (or lesser amount in the case of
Discounted Securities) of (and premium, if any, on) and interest and Deferred
Interest, if any, on such 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 (or lesser amount in the case of Discounted Securities) (and premium,
if any) and interest and Deferred Interest, if any, respectively; and

 

50

 

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

 

SECTION 5.07.                             Limitation on Suits.

 

Except as set forth in Section 5.08, no Holder of any Security of
any particular series shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Subordinated Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:

 

(a)                                  an
Event of Default, Payment Default, Capital Security Default, Payment Event or
other default as specified in Section 5.03(g) with respect to that series
shall have occurred and be continuing and such Holder shall have previously
given written notice to the Subordinated Trustee for the Securities of such
series of such Event of Default, Payment Default, Capital Security Default,
Payment Event or other default as specified in Section 5.03(g) and the
continuance thereof;

 

(b)                                 the
Holders of not less than 25% in aggregate principal amount of the Outstanding
Securities of that series shall have made written request to the Subordinated
Trustee for the Securities of such series to institute proceedings in respect
of such Event of Default, Payment Default, Capital Security Default, Payment
Event or other default as specified in Section 5.03(g) in its own name as
Trustee hereunder;

 

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

 

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

 

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

 

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

 

51

 

SECTION 5.08.                             Unconditional Right of Holders to Receive Principal (and Premium, if
any) and Interest, if any.

 

Notwithstanding any other provision in this Subordinated Indenture, but
subject to Section 3.07 hereof, and subject further to the obligation to
make Deferred Interest Payments pursuant to the Alternative Coupon Satisfaction
Mechanism, as and to the extent set forth in a Board Resolution or supplemental
indenture pursuant to Section 3.01 hereof, the Holder of any Security
shall have the right which is absolute and unconditional to receive payment of
the principal of (and premium, if any, on) 
and interest, if any, on such Security on the Stated Maturity, Deferred
Interest Payment Date or Deferred Principal Payment Date, as the case may be,
expressed in any 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 right shall not be impaired without the consent of such Holder.

 

SECTION 5.09.                             Restoration of Rights and Remedies.

 

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

 

SECTION 5.10.                             Rights and Remedies Cumulative.

 

Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in the last paragraph of
Section 3.06, no right or remedy herein conferred upon or reserved to the
Subordinated Trustee for the Securities of any series or to the Holders of
Securities is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. 
The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.

 

SECTION 5.11.                             Delay or Omission Not Waiver.

 

No delay or omission of the Subordinated Trustee for the Securities of
any series or of any Holder of any Security of such series to exercise any
right or remedy accruing upon any Event of Default, Payment Default, Capital
Security Default, Payment Event or other default as specified in
Section 5.03(g) with respect to the Securities of such series shall impair
any such right or remedy or constitute a waiver of any such Event of Default,
Payment Default, Capital Security Default, Payment Event or other default as specified
in Section 5.03(g) or an acquiescence therein.  Every right and remedy given by this
Article or by law to such Subordinated Trustee for the Securities of any
series or to the Holders may be exercised from time to time, and as often as
may be deemed expedient, by such Subordinated Trustee or by the Holders, as the
case may be.

 

52

 

SECTION 5.12.                             Control by Holders.

 

Subject to Section 6.03, the Holders of a majority in aggregate
principal amount of the Outstanding Securities of any particular series shall
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Subordinated Trustee for the
Securities of such series with respect to the Securities of that series or
exercising any trust or power conferred on such Subordinated Trustee with
respect to such Securities;  provided
that:

 

(1)                                  the
Subordinated Trustee may refuse to follow any direction in conflict with any
rule of law or with this Subordinated Indenture or which is unjustly
prejudicial to the Holders of the Securities of that series not taking part in
the direction;

 

(2)                                  the
Subordinated Trustee need not take any action which might involve it in
personal liability; and

 

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

 

SECTION 5.13.                             Waiver of Past Defaults.

 

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

 

(1)                                  a
default in the payment of the principal of (or premium, if any, on) or interest
or Deferred Interest, if any, on any Security of that series; or

 

(2)                                  a
default with respect to a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of that series affected.

 

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

 

SECTION 5.14.                             Undertaking for Costs.

 

All parties to this Subordinated Indenture agree, and each Holder of
any Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Subordinated Indenture or in any suit against the
Subordinated Trustee for the Securities of any series for any action taken or
omitted by it as Subordinated Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may
in its discretion assess reasonable costs, including reasonable attorneys’ fees
and expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall (subject to applicable laws) not
apply to any suit instituted by the Subordinated Trustee for the Securities of
any series, to any suit instituted by any Holder, or group of Holders, holding
in the aggregate more than 10% in aggregate principal amount of the Outstanding
Securities of any

 

53

 

particular series or to any suit instituted by any Holder of any
Security for the enforcement of the payment of the principal of (or premium, if
any, on) or interest, if any, or Deferred Interest, if any, on any Security of
such series on or after the respective Stated Maturities, if any, expressed in
such Security or the date the same becomes due and payable as expressed herein
or in such Security (or, in the case of redemption or conversion or exchange,
on or after the Redemption Date or the Event Date, as the case may be).

 

SECTION 5.15.                             Waiver of Stay or Extension Laws.

 

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

 

SECTION 5.16.                             Judgment Currency.

 

If, for the purpose of obtaining a judgment in any court with respect
to any obligation of the Issuer hereunder or under any Security it shall become
necessary to convert into any other currency or currency unit any amount in the
currency or currency unit due hereunder or under such Security then such
conversion shall be made by the Issuer or the Currency Determination Agent at
the Market Exchange Rate as in effect on the date of entry of the judgment (the
“Judgment Date”).  If pursuant to any
such judgment, conversion shall be made on a date (the “Substitute Date”) other
than the Judgment Date and there shall occur a change between the Market
Exchange Rate as in effect on the Judgment Date and the Market Exchange Rate as
in effect on the Substitute Date, the Issuer agrees to pay such additional
amounts (if any) as may be necessary to ensure that the amount paid is equal to
the amount in such other currency or currency unit which, when converted at the
Market Exchange Rate as in effect on the Judgment Date, is the amount due
hereunder or under such Security.  Any
amount due from the Issuer under this Section 5.16 shall be due as a
separate debt and is not to be affected by or merged into any judgment being
obtained for any other sum due hereunder or in respect of any Security as the
case may be.  In no event, however, shall
the Issuer be required to pay more in the currency or currency unit due
hereunder or under such Security at the Market Exchange Rate as in effect on
the Judgment Date than the amount of currency or currency unit stated to be due
hereunder or under such Security so that in any event the obligations of the
Issuer hereunder or under such Security will be effectively maintained as
obligations in such currency or currency unit, and the Issuer shall be entitled
to withhold (or be reimbursed for, as the case may be) any excess of the amount
actually realized upon any such conversion on the Substitute Date over the
amount due and payable on the Judgment Date.

 

54

 

ARTICLE SIX

THE SUBORDINATED TRUSTEE

 

SECTION 6.01.                             Certain Duties and Responsibilities.

 

(a)                                  Except
during the continuance of an Event of Default, Payment Default, Capital
Security Default, Payment Event or other default as specified herein with
respect to the Securities of any series for which the Subordinated Trustee is
serving as such:

 

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

 

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

 

(b)                                 In
case an Event of Default, Payment Default, Capital Security Default, Payment
Event or other default as specified herein with respect to a series of
Securities has occurred and is continuing, the Subordinated Trustee for the
Securities of such series shall exercise such of the rights and powers vested
in it by this Subordinated Indenture, and use the same degree of care and skill
in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his own affairs.  The Subordinated Trustee will be under no
obligation to exercise any of its rights or powers under the Subordinated
Indenture at the request of any Holder of Subordinated Debt Securities, unless
such Holder shall have offered to the Subordinated Trustee security and
indemnity reasonably satisfactory to the Subordinated Trustee against any other
loss, liability or expense, and then only to the extent required by the terms
of the Subordinated Indenture.

 

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

 

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

 

(2)                                  such
Subordinated 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 Subordinated
Trustee was negligent in ascertaining the pertinent facts;

 

(3)                                  such
Subordinated Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with a
direction received by it pursuant to Sections 5.02, 5.07, 5.12 or 5.13 or
exercising any trust or power conferred

 

55

 

upon such Subordinated Trustee, under this Subordinated Indenture with
respect to the Securities of that series; and

 

(4)                                  no
provision of this Subordinated Indenture shall require the Subordinated Trustee
for any series of Securities 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.

 

(d)                                 Whether
or not therein expressly so provided, every provision of this Subordinated
Indenture relating in any way to the Subordinated Trustee for any series of Securities
shall be subject to the provisions of this Section.

 

SECTION 6.02.                             Notice of Default.

 

Within 90 days after the occurrence of any Event of Default, Payment
Default, Capital Security Default, Payment Event or other default hereunder
with respect to Securities of any particular series, the Subordinated Trustee
for the Securities of such series shall give to Holders of Securities of that
series, in the manner set forth in Section 1.06, notice of such default,
if actually known to such Subordinated Trustee, unless such default shall have
been cured or waived; provided, however,
that, except in the case of a default in the payment of the principal of (or
premium, if any, on) or interest or Deferred Interest, if any, on any Security
of that series, the Subordinated Trustee shall be protected in withholding such
notice if and so long as it determines in good faith that the withholding of
such notice is in the interests of the Holders of Securities of that series;
and provided, further, that in the case of any
default of the character specified in Section 5.03(h) with respect to
Securities of that series no such notice to Holders shall be given until at
least 60 days after the occurrence thereof.

 

SECTION 6.03.                             Certain Rights of Subordinated Trustee.

 

Except as otherwise provided in Section 6.01:

 

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

 

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

 

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

 

(4)                                  such
Subordinated 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;

 

56

 

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

 

(6)                                  such
Subordinated 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,
coupon or other paper or document, but such Subordinated Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as it
may see fit,  and, if such Subordinated
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;

 

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

 

(8)                                  such
Subordinated Trustee shall have no duties or responsibilities with respect to
and shall have no liability for the actions taken or the failures to act of any
other Subordinated Trustees appointed hereunder;

 

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

 

(10)                            such
Subordinated Trustee shall not be deemed to have notice of any default or Event
of Default unless a Responsible Officer of the Subordinated Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Subordinated Trustee at the Corporate Trust Office
of the Subordinated Trustee, and such notice references the Securities and this
Subordinated Indenture;

 

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

 

(12)                            before
the Subordinated Trustee acts or refrains from acting, the Subordinated Trustee
may request that the Issuer deliver an Officers’ Certificate setting forth the
names of individuals and/or titles of officers authorized at such time to take
specified actions pursuant to this Indenture, which Officers’ Certificate may
be signed by any person authorized to sign an Officers’ Certificate, including any
person specified as so authorized in any such certificate previously delivered
and not superseded.

 

57

 

SECTION 6.04.                             Not Responsible for Recitals or Issuance of Securities.

 

The recitals and statements contained herein and in the Securities
(except the Subordinated Trustee’s certificate of authentication) shall be
taken as the recitals and statements of the Issuer, and the Subordinated
Trustee for any series of Securities assumes no responsibility for their
correctness.  The Subordinated Trustee
for any series of Securities makes no representations as to the validity or
sufficiency of this Subordinated Indenture or of the Securities of any series
(except for the Subordinated Trustee’s certificates of authentication
thereof).  The Subordinated Trustee for
any series of Securities shall not be accountable for the use or application by
the Issuer of the Securities or the proceeds thereof. The Subordinated Trustee
shall have no duty to ascertain or inquire as to the performance of the
Issuer’s covenants in Article Ten hereof or otherwise established by the
terms of any Security.

 

SECTION 6.05.                             May Hold Securities.

 

The Subordinated Trustee for any series of Securities, any Paying
Agent, Security Registrar or any other agent of the Issuer or such Subordinated
Trustee, in its individual or any other capacity, may become the owner or
pledgee of Securities and, subject to Sections 6.08 and 6.13, may otherwise
deal with the Issuer, with the same rights it would have if it were not such
Subordinated Trustee, Paying Agent, Security Registrar or such other agent.

 

SECTION 6.06.                             Money Held in Trust.

 

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

 

SECTION 6.07.                             Compensation and Reimbursement.

 

The Issuer agrees:

 

(1)                                  to
pay to the Subordinated Trustee for any series of Securities from time to time
such compensation for all services rendered by it hereunder as the Issuer and
the Subordinated Trustee shall mutually agree upon in writing (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 Subordinated Trustee
for any series of Securities upon its request for all reasonable expenses,
disbursements and advances incurred or made by such Subordinated Trustee in
accordance with any provision of this Subordinated Indenture (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct; and

 

(3)                                  to
indemnify such Subordinated Trustee for, and to hold it harmless against, any
loss, liability or reasonable expense incurred without negligence or willful
misconduct on its part, arising out of or in connection with the acceptance or
administration of this trust, including the reasonable costs and expenses of
defending itself against any claim (whether assented to by the Issuer, any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder.

 

58

 

As security for the performance of the obligations of the Issuer under
this Section the Subordinated Trustee for any series of Securities shall
have a lien prior to the Securities upon all property and funds held or
collected by such Subordinated Trustee as such, except funds held in trust for
the payment of principal of (or premium, if any, on) or interest or Deferred
Interest, if any, on particular Securities.

 

When the Subordinated Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01, the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.

 

The rights of the Subordinated Trustee under this Section 6.07
shall survive the resignation or removal of the Subordinated Trustee, the
payment in full of the Securities for which it is the Subordinated Trustee, the
satisfaction and discharge of this Subordinated Indenture, and the termination
hereof.

 

SECTION 6.08.                             Disqualification; Conflicting Interests.

 

The Subordinated Trustee for the Securities shall be subject to the
provisions of Section 310(b) of the Trust Indenture Act during the period
of time required thereby.  Nothing herein
shall prevent the Subordinated Trustee from filing with the Commission the
application referred to in the penultimate paragraph of Section 310(b) of
the Trust Indenture Act.  In determining
whether the Subordinated Trustee has a conflicting interest as defined in
Section 310(b) of the Trust Indenture Act with respect to the Securities
of any series, there shall be excluded Securities of any particular series of
Securities other than that series.  If
the Subordinated Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Subordinated Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Subordinated
Indenture.

 

SECTION 6.09.                             Corporate Subordinated Trustee Required; Different Subordinated
Trustees for Different Series; Eligibility.

 

There shall at all times be a Subordinated Trustee hereunder which
shall be:

 

(1)                                  a
corporation organized and doing business under the laws of the United States of
America, any state thereof, or the District of Columbia, authorized under such
laws to exercise corporate trust power and subject to supervision or
examination by Federal or State authority; or

 

(2)                                  a
corporation or other Person organized and doing business under the laws of a
foreign government that is permitted to act as Subordinated Trustee pursuant to
a rule, regulation, or other order of the Commission, authorized under such
laws to exercise corporate trust powers,

 

and which shall
have at all times a combined capital and surplus of at least $50,000,000.  If such corporation or other Person publishes
reports of condition at least annually, pursuant to law or to requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most recent report
of

 

59

 

condition so
published.  Neither the Issuer, any other
obligor upon the Securities or any Person directly or indirectly controlling,
controlled by, or under common control with the Issuer or any other obligor
upon the Securities shall serve as Subordinated Trustee for any of the
Securities.  A different Subordinated
Trustee may be appointed by the Issuer for any series of Securities prior to
the issuance of such Securities.  If the
initial Subordinated Trustee for any series of Securities is to be other than
Citibank, N.A., the Issuer and such Subordinated Trustee shall, prior to the
issuance of such Securities, execute and deliver an indenture supplemental
hereto, which shall provide for the appointment of such Subordinated Trustee as
Subordinated Trustee for the Securities of such series and shall add to or
change any of the provisions of this Subordinated Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Subordinated Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such
Subordinated Trustees co-trustees of the same trust and that each such
Subordinated Trustee shall be trustee of a trust or trusts hereunder separate
and apart from any trust or trusts hereunder administered by any other such
Subordinated Trustee.  If at any time the
Subordinated Trustee for the Securities of any series shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereunder specified in this
Article.

 

SECTION 6.10.                             Resignation and Removal; Appointment of Successor.

 

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

 

(b)                                 The
Subordinated Trustee for the Securities of any series may resign at any time
with respect to the Securities of such series by giving written notice thereof
to the Issuer.  If the instrument of
acceptance by a successor Subordinated Trustee required by Section 6.11
shall not have been delivered to the Subordinated Trustee for the Securities of
such series within 30 days after the giving of such notice of resignation, the
resigning Subordinated Trustee may petition, at the expense of the Issuer, any
court of competent jurisdiction for the appointment of a successor Subordinated
Trustee with respect to the Securities of such series.

 

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

 

(d)                                 If
at any time:

 

(1)                                  the
Subordinated Trustee for the Securities of any series shall fail to comply with
Section 310(b) of the Trust Indenture Act pursuant to Section 6.08
hereof after written request therefor by the Issuer or by any Holder who has
been a bona fide Holder of a Security of such
series for at least six months, unless the Subordinated Trustee’s duty to
resign is stayed in accordance with the provisions of Section 310(b) of
the Trust Indenture Act; or

 

60

 

(2)                                  such
Subordinated Trustee shall cease to be eligible under Section 6.09 and
shall fail to resign after written request therefor by the Issuer, or by any
such Holder; or

 

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

 

(4)                                  if
an administrative or other receiver or an administrator or other similar official
is appointed in relation to such Subordinated Trustee or in relation to the
whole or a material part of the assets of such Subordinated Trustee, or an
encumbrancer takes possession of the whole or a material part of the assets of
such Subordinated Trustee, or a distress or execution or other process is
levied or enforced upon or sued out against the whole or a material part of the
assets of such Subordinated Trustee, or if such Subordinated Trustee shall
commence a voluntary case or proceeding under any applicable Bankruptcy Law, or
any other case or proceeding to be adjudicated as bankrupt or insolvent, or
such Subordinated Trustee shall consent to the appointment of or taking
possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator
(or other similar official) of such Subordinated Trustee or its property or
affairs, or shall make an assignment for the benefit of creditors, or shall
admit in writing its inability to pay its debts generally as they become due,
or shall take corporate action in furtherance of any such action;

 

then, in any such
case, (i) the Issuer by a Board Resolution may remove such Subordinated Trustee
or (ii) subject to Section 5.14, any Holder who has been a bona fide
Holder of a Security of such series for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of such Subordinated Trustee and the appointment
of a successor Subordinated Trustee.

 

(e)                                  If
the Subordinated Trustee for the Securities of any series shall resign, be
removed or become incapable of acting, or if a vacancy shall occur in the
office of Subordinated Trustee for the Securities of any series for any cause,
the Issuer, by a Board Resolution, shall promptly appoint a successor
Subordinated Trustee with respect to the Securities of such series and shall
comply with the applicable requirements of Section 6.11.  If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor
Subordinated Trustee with respect to the Securities of such series shall be
appointed by Act of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of such series delivered to the Issuer and the
retiring Subordinated Trustee, the successor Subordinated Trustee so appointed
shall, forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 6.11, become the successor Subordinated
Trustee for the Securities of such series and supersede the successor
Subordinated Trustee appointed by the Issuer. 
If no successor Subordinated Trustee for the Securities of such series
shall have been so appointed by the Issuer or the Holders and shall have
accepted appointment in the manner required by Section 6.11, and if such
Subordinated Trustee is still incapable of acting, any Holder who has been a bona fide Holder of a Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor
Subordinated Trustee with respect to the Securities of such series.

 

(f)                                    The
Issuer shall give notice of each resignation and each removal of the
Subordinated Trustee with respect to the Securities of any series and each
appointment of a

 

61

 

successor Subordinated Trustee with respect to the Securities of any
series in the manner and to the extent provided in Section 1.06.  Each notice shall include the name of the
successor Subordinated Trustee with respect to the Securities of that series
and the address of its Corporate Trust Office.

 

SECTION 6.11.                             Acceptance of Appointment by Successor.

 

(a)                                  Every
successor Subordinated Trustee appointed hereunder with respect to the
Securities of any series shall execute, acknowledge and deliver to the Issuer
and to the retiring Subordinated Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring
Subordinated Trustee shall become effective and such successor Subordinated
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Subordinated Trustee;
but, on the request of the Issuer or the successor Subordinated Trustee, such
retiring Subordinated Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Subordinated Trustee all
the rights, powers and trusts of the retiring Subordinated Trustee and shall
duly assign, transfer and deliver to such successor Subordinated Trustee all
property and money held by such retiring Subordinated Trustee hereunder.

 

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

 

62

 

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

 

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

 

SECTION 6.12.                             Merger, Conversion, Consolidation or Succession to Business.

 

Any corporation into which the Subordinated Trustee for the Securities
of any series may be merged or converted or with which it may be consolidated,
or any corporation resulting from any merger, conversion or consolidation to
which such Subordinated Trustee shall be a party, or any corporation succeeding
to all or substantially all of the corporate trust business of such
Subordinated Trustee, shall be the successor of such Subordinated Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.

 

SECTION 6.13.                             Preferential Collection of Claims Against Issuer.

 

If and when the Subordinated Trustee for Securities of any series shall
be or become a creditor of the Issuer (or any other obligor upon the Securities
of such series), the Subordinated Trustee shall be subject to the provisions of
the Trust Indenture Act regarding the collection of claims against the Issuer
(or any such other obligor).

 

ARTICLE SEVEN

HOLDERS’ LISTS AND REPORTS BY
SUBORDINATED TRUSTEE AND ISSUER

 

SECTION 7.01.                             Issuer to Furnish Subordinated Trustee Names and Addresses of Holders.

 

With respect to each particular series of Securities, the Issuer will
furnish or cause to be furnished to the Subordinated Trustee of such series:

 

(1)                                  at
least semi-annually and, if applicable, not more than 15 days after each
Regular Record Date relating to that series (or, if there is no Regular Record
Date relating to that series, on June 30 and December 31), a list, in
such form as such Subordinated Trustee may reasonably require, containing all
the information in the possession or control of the Issuer or any of its Paying
Agents as to the names and addresses of the Holders of that series as of such
dates, excluding from any such list any information already in the possession
or control of the Subordinated Trustee which was received by such Subordinated
Trustee acting in any capacity with respect to such series of Securities; and

 

(2)                                  at
such other times as the Subordinated Trustee may request in writing, within 30
days after the receipt by the Issuer of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished, excluding from any such list all the information already in the
possession or control of the Subordinated Trustee which was received by such
Subordinated Trustee acting in any capacity with respect to such series of
Securities.

 

63

 

SECTION 7.02.                             Preservation of Information; Communications to Holders.

 

(a)                                  The
Subordinated Trustee for each series of Securities shall preserve, in as
current a form as is reasonably practicable, the names and addresses of Holders
of the Securities of such series contained in the most recent lists furnished
to the Subordinated Trustee as provided in Section 7.01 and the names and
addresses of Holders of the Securities of such series received by the
Subordinated Trustee in its capacity as Security Registrar for such series, if
so acting.  The Subordinated Trustee for
each series of Securities may destroy any list relating to such series of
Securities furnished to it as provided in Section 7.01 upon receipt of a new
list relating to such series so furnished.

 

(b)                                 If
three or more Holders of Securities of any particular series (hereinafter
referred to as “applicants”) apply in writing to the Subordinated Trustee for
the Securities of any such series, and furnish to such Subordinated Trustee
reasonable proof that each such applicant has owned a Security of that series
for a period of at least six months preceding the date of such application, and
such application states that the applicants desire to communicate with other
Holders of Securities of that series with respect to their rights under this
Subordinated Indenture or under the Securities of that series and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then such Subordinated Trustee shall, within
five Business Days after the receipt of such application, at its election,
either:

 

(1)                                  afford
such applicants access to the information preserved at the time in accordance
with Section 7.02(a); or

 

(2)                                  inform
such applicants as to the approximate number of Holders of Securities of that
series whose names and addresses appear in the information preserved at the
time by such Subordinated Trustee in accordance with Section 7.02(a), and
as to the approximate cost of mailing to such Holders the form of proxy or
other communication, if any, specified in such application.

 

If any such Subordinated Trustee shall elect not to afford such
applicants access to that information, such Subordinated Trustee shall, upon
the written request of such applicants, mail to each Holder of Securities of
that series whose name and address appears in the information preserved at the
time by the Subordinated Trustee in accordance with Section 7.02(a), a
copy of the form of proxy or other communication which is specified in such request,
with reasonable promptness after a tender to such Subordinated Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, such
Subordinated Trustee shall mail to such applicants and file with the
Commission, together with a copy of the material to be mailed, a written
statement to the effect that, in the opinion of such Subordinated Trustee, such
mailing would be contrary to the best interests of the Holders of Securities of
that series or would be in violation of applicable law.  Such written statement shall specify the
basis of such opinion.  If the
Commission, after opportunity for a hearing upon the objections specified in
the written statement so filed shall enter an order refusing to sustain any of
such objections or if, after the entry of an order sustaining one or more of
such objections, the Commission shall find, after notice and opportunity for
hearing, that all the objections so sustained have been met and shall enter an
order so declaring, such Subordinated Trustee shall mail copies of such
material to all such Holders with reasonable promptness after the entry of such
order and the renewal of such tender; otherwise such

 

64

 

Subordinated Trustee shall be relieved of any obligation or duty to
such applicants respecting their application.

 

(c)                                  Every
Holder of Securities of each series, by receiving and holding the same, agrees
with the Issuer and the Subordinated Trustee for the Securities of such series
that none of the Issuer such Subordinated Trustee or any of their agents shall
be held accountable by reason of the disclosure of any such information as to
the names and addresses of the Holders of the Securities of such series in
accordance with Section 7.02(b), regardless of the source from which such
information was derived, and that the Subordinated Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 7.02(b).

 

SECTION 7.03.                             Reports by Subordinated Trustee.

 

(a)                                  Within
60 days after May 15 of each year commencing with the year following the first
issuance of Securities, the Subordinated Trustee for the Securities of each
series shall transmit by mail to all Holders of the Securities of such series,
in the manner and to the extent provided in the Trust Indenture Act, a brief
report dated as of each such May 15 if required by the Trust Indenture Act.

 

(b)                                 A
copy of each such report shall, at the time of such transmission to Holders of
Securities of any series, be filed by the Subordinated Trustee for the
Securities of such series with each Stock Exchange, with the Commission and
with the Issuer.  The Issuer will notify
such Subordinated Trustee when such series of Securities is listed on any Stock
Exchange.

 

SECTION 7.04.                             Reports by Issuer.

 

The Issuer will:

 

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

 

(2)                                  file
with the Subordinated Trustee for the Securities of such series and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such additional information, documents, and reports
with respect to compliance by the Issuer with the conditions and covenants of
this Subordinated Indenture as may be required from time to time by such rules
and regulations; and

 

(3)                                  transmit
by mail to all Holders of Securities of each series, as provided in
Section 313(c) of the Trust Indenture Act, within 30 days after the filing
thereof with the

 

65

 

Subordinated Trustee for the Securities of such series, such summaries
of any information, documents and reports required to be filed by the Issuer
pursuant to paragraphs (1) and (2) of this Section as may be required by
rules and regulations prescribed from time to time by the Commission.

 

Delivery of such
reports, information and documents to the Subordinated Trustee is for
informational purposes only and the Subordinated 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 Subordinated
Trustee is entitled to rely exclusively on Officers’ Certificates).

 

ARTICLE EIGHT

CONSOLIDATION, MERGER, CONVEYANCE
OR TRANSFER

 

SECTION 8.01.                             Issuer May Consolidate, Etc., Only on Certain Terms.

 

So long as any Security remains Outstanding, the Issuer shall not
consolidate or amalgamate with or merge into any other corporation or convey,
transfer or lease its properties and assets substantially as an entirety to any
Person unless:

 

(1)                                  the
corporation formed by such consolidation or amalgamation or into which the
Issuer is merged, or the Person which acquires, leases or is the transferee of
or recipient of the conveyance or transfer, of substantially all of the
properties and assets of the Issuer as an entirety shall:

 

(A)                              be
a corporation or other Person organized and validly existing under the laws of
any country that is a member of the OECD (as the same may be constituted from
time to time); and

 

(B)                                expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Subordinated Trustee for each series of Securities, in form reasonably satisfactory
to each such Subordinated Trustee, with any amendments or revisions necessary
to take account of the jurisdiction in which any such corporation or Person is
organized (if other than England and Wales),

 

(i)                                     the
due and punctual payment of the principal of (and premium, if any, on) and
interest, if any, on, and any sinking fund payment in respect of, all of the
Securities,

 

(ii)                                  the
performance of every covenant of this Subordinated Indenture and of all the
Securities on the part of the Issuer to be performed,

 

(iii)                               such
assumption shall provide that such corporation or Person shall pay to the
Holder of any Securities such additional amounts as may be necessary in order
that every net payment of the principal of (and premium, if any, on) and
interest, if any, and Deferred Interest, if any, on such Securities will not be
less than the amounts provided for in the Securities to be then due and
payable, and

 

66

 

(iv)                              with
respect to (iii) above such obligation shall extend to any deduction or
withholding for or on account of any present or future tax, assessment or
governmental charge imposed upon such payment by the United Kingdom or the
country in which any such corporation or Person is organized or any district,
municipality or other political subdivision or taxing authority thereof
(subject to the limitations set forth in Section 10.07 in respect of the
payment of additional amounts as applied to such country);

 

(2)                                  immediately
after giving effect to such transaction, no Event of Default, Payment Default,
Capital Security Default, or Payment Event with respect to any series of
Securities, and no event which, after notice or lapse of time or both, would
become an Event of Default, Payment Default, Capital Security Default or
Payment Event with respect to any series of Securities, shall have occurred and
be continuing; and

 

(3)                                  the
Issuer has delivered to the Subordinated Trustee for each series of Securities
an Officers’ Certificate and an Opinion of Counsel each stating that such
consolidation, amalgamation, merger, conveyance, transfer or lease and such
supplemental indenture evidencing the assumption by such corporation or Person
comply with this Subordinated Indenture and that all conditions precedent provided
for in this Subordinated Indenture relating to such transaction have been
complied with.

 

SECTION 8.02.                             Successor Corporation Substituted.

 

Upon any consolidation, amalgamation or merger, or any conveyance,
transfer or lease of the properties and assets of the Issuer substantially as
an entirety in accordance with Section 8.01, the successor corporation
formed by such consolidation or amalgamation or into which the Issuer is merged
or the Person to which such conveyance or transfer or with which such lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Issuer under this Subordinated Indenture with the same effect as
if such successor corporation or Person had been named as the Issuer herein,
and thereafter, except in the case of a lease, the predecessor corporation
shall be relieved of all obligations and covenants under this Subordinated
Indenture or the Securities.

 

ARTICLE NINE

SUPPLEMENTAL INDENTURES

 

SECTION 9.01.                             Supplemental Subordinated Indentures Without Consent of Holders.

 

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

 

(1)                                  to
evidence the succession of another corporation to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein and
contained in the Securities; or

 

(2)                                  to
add to the covenants of the Issuer for the benefit of the Holders of all or any
particular series of Securities (and, if such covenants are to be for the
benefit of fewer than all

 

67

 

series of Securities, stating that such covenants are being included
solely for the benefit of such series), to convey, transfer, assign, mortgage
or pledge any property to or with the Subordinated Trustee for the Securities
of any such series or otherwise secure any such series of the Securities or to
surrender any right or power herein conferred upon the Issuer; or

 

(3)                                  to
add any additional Events of Default, Payment Defaults, Capital Security
Defaults or Payment Events with respect to any or all series of Securities
(and, if any such Event of Default, Payment Default, Capital Security Default
or Payment Event applies to fewer than all series of Securities, stating each
series to which such Event of Default, Payment Default, Capital Security
Default or Payment Event applies); provided, that
any such additional Event of Default, Payment Default, Capital Security Default
or Payment Event would not cause any such series of Securities to be in default
immediately upon any such addition; or

 

(4)                                  to
change or eliminate any restrictions on the payment of principal of or any
premium or interest on Securities, or to provide (subject to applicable laws)
for the issuance of uncertificated Securities of any series in addition to or
in place of any certificated Securities and to make all appropriate changes for
such purposes; provided, however, that any such
action shall not adversely affect the interests of the Holders of Securities of
any series in any material respect; or

 

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

 

(6)                                  to
evidence and provide for the acceptance of appointment hereunder of a
Subordinated Trustee, other than Citibank, N.A., for a series of Securities and
to add to or change any of the provisions of this Subordinated Indenture as
shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Subordinated Trustee, pursuant to the requirements
of Section 6.09; or

 

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

 

(8)                                  to
add to the conditions, limitations and restrictions on the authorized amount,
form, terms or purposes of issue, authentication and delivery of Securities, as
herein set forth, with such other conditions, limitations and restrictions
thereafter to be observed; or

 

(9)                                  to
supplement any of the provisions of this Subordinated Indenture to such extent
as shall be necessary to permit or facilitate the defeasance and discharge of
any series of Securities pursuant to Section 4.01; provided,
however, that any such action shall not adversely affect the
interests of the Holders of Securities of such series or any other series of
Securities in any material respect; or

 

(10)                            to
add to or change or eliminate any provisions of this Subordinated Indenture as
shall be necessary or desirable in accordance with any amendments to the Trust
Indenture Act or any rules and regulations of the Commission; or

 

68

 

(11)                            to
cure any ambiguity or defect, to correct or amend or supplement any provision
herein which may be inconsistent with any other provision herein, or to make
any other provisions with respect to matters or questions arising under this
Subordinated Indenture; provided, that any such action shall not adversely
affect the interests of the Holders of Securities of any particular series in
any material respect; or

 

(12)                            to
establish the terms of a series of Securities to be issued hereunder pursuant
to, and in accordance with, Section 3.01 hereof.

 

SECTION 9.02.                             Supplemental Subordinated Indentures With Consent of Holders.

 

The Issuer, when authorized by a Board Resolution, and the Subordinated
Trustee or Subordinated Trustees for the Securities of any or all series may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Subordinated Indenture or of modifying in any manner the
rights of the Holders of such Securities under this Subordinated Indenture, but
only with the consent of the Holders of 50% (or any greater requisite amount)
in aggregate principal amount of the Outstanding Securities of each series of
Securities then Outstanding affected thereby, in each case by Act of said
Holders of Securities of each such series delivered to the Issuer and the Subordinated
Trustee for Securities of each such series; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby:

 

(1)                                  change
the Stated Maturity, if any, of the principal of, or any installment of
principal of or interest on, any Security, or change the terms of any Perpetual
Subordinated Debt Securities or Perpetual Subordinated Capital Securities to
include a Stated Maturity of the principal amount thereof, or reduce the principal
amount of any Security, the rate of interest thereon, if any, or any Deferred
Interest, or any premium or principal payable upon any redemption or repurchase
of such Securities or change the time at which such Securities may or must be
redeemed to the detriment of any holder, or change any obligation of the Issuer
to pay additional amounts pursuant to Sections 5.16 and 10.07 (except as
contemplated by Section 8.01(1) and permitted by Section 9.01(1)) or
reduce the amount of the principal of a Discounted Security that would be due
and payable upon a declaration of acceleration of the Maturity thereof pursuant
to Section 5.02, or change any Place of Payment where, or change the
currency or currency unit in which, any Security or any interest or Deferred Interest
thereon is payable, or impair the right to institute suit for the enforcement
of any such payment on or after the Stated Maturity, if any, thereof or the
date any such payment is otherwise due and payable (or, in the case of
redemption, on or after the Redemption Date);

 

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

 

(3)                                  change
any obligation of the Issuer to maintain an office or agency in the places and
for the purposes specified in Section 10.02;

 

(4)                                  change
the terms and conditions (i) under which the Securities are convertible or
exchangeable or (ii) of the Preference Shares into which such Securities may be
converted

 

69

 

or exchanged, in each case, in any manner that has a material adverse
effect on the rights of any holder of such Securities;

 

(5)                                  modify
any of the provisions of this Section or Sections 5.13 or 10.06, except to
increase any specified percentage in aggregate principal amount required for
any actions by Holders or to provide that certain other provisions of this
Subordinated Indenture cannot be modified or waived without the consent of the
Holder of each Security affected thereby; provided, however,
that this clause shall not be deemed to require the consent of any Holder of a
Security with respect to changes in the references to “the Subordinated
Trustee” and concomitant changes in this Section and Sections 5.12 or
10.06, or the deletion of this proviso, in accordance with the requirements of
Sections 6.09, 6.11(b), 9.01(6) and 9.01(7); or

 

(6)                                  change
in any manner adverse to the interests of the Holders of any Outstanding
Securities the subordination provisions of such Securities.

 

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

 

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

 

SECTION 9.03.                             Execution of Supplemental Subordinated Indentures.

 

In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Subordinated Indenture, the Subordinated
Trustee for any series of Securities shall be entitled to receive, and (subject
to Section 6.01) shall be fully protected in relying upon, an Officers’
Certificate and an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Subordinated
Indenture.  The Subordinated Trustee for
any series of Securities may, but shall not (except to the extent required in
the case of a supplemental indenture entered into under Section 9.01(6) or
(7)) be obligated to, enter into any such supplemental indenture which affects
such Subordinated Trustee’s own rights, liabilities, duties or immunities under
this Subordinated Indenture or otherwise.

 

SECTION 9.04.                             Effect of Supplemental Subordinated Indentures.

 

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

 

70

 

SECTION 9.05.                             Conformity With Trust Indenture Act.

 

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

 

SECTION 9.06.                             Reference in Securities to Supplemental Subordinated Indentures.

 

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

 

ARTICLE TEN

COVENANTS

 

SECTION 10.01.                      Payment of Principal (and Premium, if any) and Interest and Deferred
Interest, if any.

 

The Issuer agrees, for the benefit of each particular series of
Securities, that it will duly and punctually pay in the currency or currency
unit in which the Securities of such series are payable (except as otherwise
specified pursuant to Section 3.01 for the Securities of such series and
except as provided in Sections 3.11(b), 3.11(d) and 3.11(e)) the principal of
(and premium, if any, on) and interest and Deferred Interest, if any, on that
series of Securities in accordance with the terms of the Securities of such
series and this Subordinated Indenture.

 

SECTION 10.02.                      Maintenance of Office or Agency.

 

If Securities of a series are issuable as Registered Securities, the
Issuer will maintain in the Borough of Manhattan, The City of New York, and in
each Place of Payment for that series an office or agency where Securities of
that series may be presented or surrendered for payment, and an office or
agency where Securities of that series may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Issuer with
respect to the Securities of that series and this Subordinated Indenture may be
served.  The Issuer will give prompt
written notice to the Subordinated Trustee for the Securities of that series of
the location, and 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 in respect of any series of
Securities or shall fail to furnish the Subordinated Trustee for the Securities
of that series with the address thereof, such presentations (to the extent
permitted by law) and surrenders of Securities of that series may be made and
notices and demands may be made or served at the Corporate Trust Office of such
Subordinated Trustee, and the Issuer hereby appoints such Subordinated Trustee
as its agent to receive such respective presentations, surrenders, notices and
demands.

 

The Issuer may also from time to time designate one or more other offices
or agencies (in or outside a Place of Payment) where the Securities of one or
more series may be

 

71

 

presented or surrendered for any or all of the purposes specified above
in this Section and may from time to time rescind such designations; 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 each Place of Payment for such purpose.  The Issuer will give prompt written notice to
the Subordinated Trustee for the Securities of each series so affected of any
such designation or rescission and of any change in the location of any such
office or agency.

 

Unless otherwise specified pursuant to Section 3.01, if and so
long as the Securities of any series (i) are denominated in a currency other
than Dollars or (ii) may be payable in a currency other than Dollars, or so
long as it is required under any other provision of the Subordinated Indenture,
then the Issuer will maintain with respect to each such series of Securities,
or as so required, a Currency Determination Agent.

 

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

 

If the Issuer shall at any time act as its own Paying Agent with
respect to any particular series of Securities, it will, on or before each due
date of the principal of (or premium, if any, on) or interest, or Deferred
Interest, if any, on any of the Securities of that series, segregate and hold
in trust for the benefit of the Persons entitled thereto a sum in the currency
or currency unit in which the Securities of such series are payable (except as
otherwise specified pursuant to Section 3.01 for the Securities of such
series and except as provided in Sections 3.11(b), 3.11(d) and 3.11(e))
sufficient to pay the principal (and premium, if any) and interest and Deferred
Interest , if any, so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided, and will promptly notify
the Subordinated Trustee for the Securities of such series of its action or
failure so to act.

 

Whenever the Issuer shall have one or more Paying Agents for any
particular series of Securities, the Issuer will, prior to 10:00 a.m. in the
applicable Place of Payment on each due date of the principal of (or premium,
if any, on) or interest or Deferred Interest, if any, on any such Securities,
deposit with a Paying Agent for the Securities of such series a sum (in the
currency or currency unit described in the preceding paragraph) sufficient to
pay the principal (and premium, if any) and interest and, subject to
Section 3.07, Deferred Interest, if any, so becoming due, such sum to be
held in trust for the benefit of the Persons entitled thereto and (unless such
Paying Agent is the Subordinated Trustee for the Securities of such series) the
Issuer will promptly notify such Subordinated Trustee of its action or failure
so to act.

 

The Issuer will cause each Paying Agent (other than the Subordinated
Trustee) for any particular series of Securities to execute and deliver to such
Subordinated Trustee an instrument in which such Paying Agent shall agree with
such Subordinated Trustee, subject to the provisions of this Section, that such
Paying Agent will:

 

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

 

(2)                                  give
such Subordinated Trustee notice of any default by the Issuer (or any other
obligor upon the Securities) in the making of any payment of principal of (and
premium, if any, on) and interest and Deferred Interest, if any, on Securities
of that series; and

 

72

 

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

 

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

 

Any money deposited with the Subordinated Trustee or any Paying Agent
for the Securities of any series, or then held by the Issuer in trust for the
payment of the principal of (and premium, if any, on) and interest and Deferred
Interest, if any, on any Securities of any particular series and remaining
unclaimed for two years after such principal (and premium, if any) and interest
and Deferred Interest, if any, has become due and payable shall, unless
otherwise required by mandatory provisions of applicable escheat, or abandoned
or unclaimed property law, be paid to the Issuer on delivery of an Issuer Request,
or (if then held by the Issuer) shall be discharged from such trusts; 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 such
Subordinated 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 such Subordinated Trustee
or such Paying Agent, before being required to make any such repayment shall
give notice to the Holder of such Security in the manner set forth in
Section 1.06 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
notice, any unclaimed balance of such money then remaining will, unless
otherwise required by mandatory provisions of applicable escheat, or abandoned
or unclaimed property law, be repaid to the Issuer; provided, further, that the
Subordinated Trustee or such Paying Agent shall give written notice of any such
unclaimed amounts to the Issuer within 30 days after the end of such two year
period.

 

SECTION 10.04.                      Statements as to Compliance.

 

The Issuer will deliver to the Subordinated Trustee for each series of
Securities, within four months after the end of each fiscal year ending after
the date hereof, an Officers’ Certificate (one of the signers of which shall be
the chief executive officer, treasurer or finance director of the Issuer)
stating whether or not, to the knowledge of such officers, after due
investigation, the Issuer has complied with all conditions and covenants and
fulfilled all of its obligations under this Subordinated Indenture during such
year and, if such officers have obtained knowledge of any default or Event of
Default, specifying all such defaults or Events of Default and the nature
thereof of which such officers may have knowledge and whether any such default
or Events of Default is continuing or not.

 

For purposes of this Section, such compliance or fulfillment shall be determined
without regard to any period of grace or requirement of notice provided under
this Subordinated Indenture.

 

The Issuer shall deliver to the Subordinated Trustee, as soon as
possible and in any event within five days after the Issuer becomes aware of
the occurrence of any Event of

 

73

 

Default or an event which, with notice or the lapse of time or both,
would constitute an Event of Default, an Officers’ Certificate setting forth
the nature and status of such Event of Default.

 

SECTION 10.05.                      Corporate Existence.

 

Subject to Article Eight, the Issuer will do or cause to be done
all things necessary to preserve and keep in full force and effect their
respective corporate existences.

 

SECTION 10.06.                      Waiver of Certain Covenants.

 

The Issuer may omit in any particular instance to comply with any
covenant or condition set forth in Sections 10.02 and 10.05 and any other
covenant not set forth herein and specified pursuant to Section 3.01 to be
applicable to the Securities of any series, if before or after the time for
such compliance the Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities of each series of Securities affected by
the omission (which, in the case of a covenant not set forth herein and
specified pursuant to Section 3.01 to be applicable to the Securities of
any series, shall include only those series to which such covenant is so
specified to be applicable) shall, in each case by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with such
covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Issuer and the duties of
the Subordinated Trustee for the Securities of each series with respect to any
such covenant or condition shall remain in full force and effect.

 

SECTION 10.07.                      Payment of Additional Amounts.

 

Unless otherwise provided in the Board Resolution or supplemental
indenture pursuant to Section 3.01 establishing the terms of a particular
series of Securities, the Issuer will pay to the Holder of any Security such
additional amounts as may be necessary in order that every net payment of the
principal of (and premium, if any, on) and interest, if any, and Deferred
Interest, if any, on any such Security after deduction or other withholding for
or on account of any present or future tax, assessment, duty or other
governmental charge of any nature whatsoever imposed, levied or collected by or
on behalf of the United Kingdom or any political subdivision or taxing
authority thereof or therein having power to tax, will not be less than the
amount provided for in any such Security to be then due and payable;
provided,  however, that the foregoing
obligation to pay additional amounts will not apply on account of any tax,
assessment, duty or other governmental charge which is payable:

 

(1)                                  otherwise
than by deduction or withholding from payments of principal of (or premium, if
any, on) or interest or Deferred Interest, if any, on any such Security; or

 

(2)                                  by
reason of such Holder having, or having had, some personal or business
connection with the United Kingdom and not merely by reason of the fact that
payments are, or for the purposes of taxation are deemed to be, from sources
in, or secured in the United Kingdom; or

 

(3)                                  except
in the case of the winding up of the Issuer in England, where the relevant
Security is presented for payment in the United Kingdom; or

 

74

 

(4)                                  where
the relevant Security is presented for payment more than 30 days after the
Relevant Date (as defined below) except to the extent that the relevant Holder
would have been entitled to such additional amounts on presenting the Security
for payment on such thirtieth day; or

 

(5)                                  with
respect to a payment to an individual, where the deduction or withholding is
required to be made pursuant to any European Union Directive on the taxation of
savings implementing the conclusions of the meeting of the European Council of
Economics and Finance Ministers of November 26-27, 2000 (or any
supplemental ECOFIN meeting relating to such directive) or any law implementing
or complying with, or introduced in order to conform to, such Directive; or

 

(6)                                  on
a Security presented for payment by a Holder who would have been able to avoid
such deduction or withholding by presenting the relevant Security to another
paying agent in a Member State of the European Union or elsewhere; or

 

(7)                                  by
reason by any estate, excise, inheritance, gift, sales, transfer, wealth or
personal property tax or any similar assessment or governmental charge; or

 

(8)                                  as
a result of the failure of a Holder to satisfy any statutory requirements or
make a declaration of non-residence or other claim for exemption; or

 

(9)                                  by
reason of a change in law or official practice of any relevant taxing authority
that becomes effective more than 30 days after the Relevant Date (as defined
below) for payment of principal (or premium, if any) or interest or Deferred
Interest, if any, in respect of such Security; or

 

(10)                            owing
to any combination of clauses (1) through (9) above (provided that such
provision is applicable to the relevant series of Securities in accordance with
this Subordinated Indenture).

 

No additional amounts will be paid as provided above with respect to
any payment of principal of (or premium, if any, on) or interest or Deferred
Interest, if any, on any such Security to any Holder who is a fiduciary or
partnership or other than the sole beneficial owner of any such payment to the
extent that a beneficiary or settlor with respect to such fiduciary, a member
of such a partnership or the beneficial owner of such payment would not have
been entitled to the additional amounts had such beneficiary, settlor, member
or beneficial owner been the Holder of any such Security.

 

For the purposes hereof the “Relevant Date” means the date on which the
payment of principal of (or premium, if any, on) or interest or Deferred
Interest, if any, on any Security first becomes due and payable but, if the
full amount of the monies payable on such date has not been received by the
relevant Paying Agent or as it shall have directed on or prior to such date,
the “Relevant Date” means the date on which such monies shall have been so
received.

 

Whenever in this Subordinated Indenture there is mentioned, in any
context, the payment of the principal of (or premium, if any, on) or interest
or Deferred Interest (or, with respect to the Perpetual Subordinated Capital
Securities, any other payments), if any, on any Security, such mention shall be
deemed to include mention of the payment of additional amounts provided for in
the terms of such Securities and this Section to the extent that, in such
context, additional amounts are, were or would be payable in respect thereof
pursuant to

 

75

 

the provisions of this Section and express mention of the payment
of additional amounts (if applicable) in any provisions hereof shall not be
construed as excluding additional amounts in those provisions hereof where such
express mention is not made.

 

If the Securities of a series provide for the payment of additional
amounts as contemplated by Section 3.01(21), at least 10 days prior to the
first Interest Payment Date with respect to that series of Securities (or if
the Securities of that series will not bear interest prior to Maturity, the
first day on which a payment of principal and any premium is made), and at
least 10 days prior to each date of payment of principal (and premium, if any)
and interest and Deferred Interest, if any, if there has been any change with
respect to the matters set forth in the below-mentioned Officers’ Certificate,
the Issuer will furnish the Subordinated Trustee for that series of Securities
with an Officers’ Certificate instructing such Subordinated Trustee whether
such payment of principal of (and premium, if any, on) and interest and
Deferred Interest, if any, on the Securities of that series shall be made to
Holders of Securities of that series without withholding for or on account of
any tax, assessment, duty or other governmental charge as referred to above or
described in the Securities of that series. 
If any such withholding shall be required, then such Officers’
Certificate shall specify by country the amount, if any, required to be
withheld on such payments to such Holders of Securities and the Issuer will pay
to the Subordinated Trustee for such series of Securities such additional
amounts as may be required pursuant to the terms applicable to such
series.  The Issuer covenants to
indemnify the Subordinated Trustee for such series of Securities and any Paying
Agent for, and to hold them harmless against, any loss, liability or expense
reasonably incurred without gross negligence, willful default or bad faith on
their part arising out of or in connection with actions taken or omitted by any
of them in reliance on any Officers’ Certificate furnished pursuant to this
Section 10.07 or the failure to provide any such Officers’
Certificate.  The obligations contained
in the immediately preceding sentence of the Issuer shall survive payment of
all of the Securities, the satisfaction and discharge of this Subordinated
Indenture, and the resignation or removal of the Subordinated Trustee or any
Paying Agent for such series of Securities.

 

The Issuer hereby undertakes that, if any withholding or deduction is
imposed on a payment to an individual and is required to be made pursuant to
the proposal agreed by the European Council of the Economic and Finance
Ministers (“ECOFIN”) on January 21,  2003
or any law implementing or complying with, or introduced in order to conform
to, any such Directive, it will ensure that it maintains a paying agent with a
specific office in a European Union member state that will not be obliged to
withhold or deduct tax pursuant to any European Union Directive on the taxation
of savings income implementing those proposals or any such law; provided, that under no circumstances shall the Issuer be
obliged to maintain a paying agent with a specified office in such member state
unless at least one member state of the European Union does not require a paying
agent making payments through a specified office in that member state to so withhold
or deduct tax.

 

SECTION 10.08.                      Calculation of Original Issue Discount.

 

The Issuer shall file with the Subordinated
Trustee promptly at the end of each calendar year (i) a written notice
specifying the amount of original issue discount (including daily rates and
accrual periods) accrued on Outstanding Securities as of the end of such year
and (ii) such other specific information relating to such original issue
discount as may then be relevant under the Internal Revenue Code of 1986, as
amended from time to time.

 

ARTICLE ELEVEN

REDEMPTION OF SECURITIES

 

SECTION 11.01.                      Applicability of This Article.

 

Redemption of Securities of any series (whether by operation of a
sinking fund or otherwise) as permitted or required by the terms of any such
Securities shall be made in accordance with such terms and (except as otherwise
specified pursuant to Section 3.01 with respect to Securities of such
series) this Article; provided, however,
that if any of the terms of any such Securities shall conflict with any
provision of this Article, the terms of such Securities shall govern; and provided, further, that the option or obligation of the
Issuer to redeem any Securities on any Redemption Date shall be subject to any
consent required of

 

76

 

the Financial Services Authority having been obtained and subject also
in the case of Perpetual Subordinated Debt Securities and Perpetual
Subordinated Capital Securities to the Solvency Condition being satisfied by
the Issuer on any such Redemption Date and such other requirements as may be
established pursuant to a Board Resolution or supplemental indenture pursuant
to Section 3.01 with respect to such series.

 

SECTION 11.02.                      Election to Redeem; Notice to Subordinated Trustee.

 

The election of the Issuer to redeem any Securities of any series shall
be evidenced by or pursuant to a Board Resolution.  In case of any redemption at the election of
the Issuer of less than all of the Securities of any particular series, the
Issuer shall, at least 45 days prior to the Redemption Date fixed by the Issuer
(unless a shorter notice shall be satisfactory to the Subordinated Trustee for
the Securities of such series), notify the Subordinated Trustee for Securities
of such series by an Issuer Request of such Redemption Date and of the
principal amount of Securities of that series to be redeemed.

 

In the case of any redemption of Securities of any series prior to the
expiration of any restriction on such redemption provided in the terms of such
Securities or elsewhere in this Subordinated Indenture, the Issuer shall
furnish the Subordinated Trustee for Securities of such series with an
Officers’ Certificate evidencing compliance with such restriction.

 

In the case of any redemption of Securities of any series pursuant to
Sections 11.08 or 11.09 the Issuer shall furnish the Subordinated Trustee for
the Securities of such series with an Officers’ Certificate and an Opinion of
Counsel confirming that the Issuer is entitled to exercise the right of
redemption.

 

SECTION 11.03.                      Selection of Securities to Be Redeemed.

 

If less than all the Securities are to be redeemed, the Issuer may
select the series to be redeemed, and if less than all of the Securities of any
series are to be redeemed, the particular Securities of that series to be
redeemed shall be selected not more than 45 days prior to the Redemption Date
by the Subordinated Trustee for the Securities of such series, from the Outstanding
Securities of that series not previously called for redemption, by such method
as the Subordinated Trustee for the Securities of such series shall approve and
which may provide for the selection for redemption of portions (equal to the
minimum authorized denomination for Securities of that series, or any integral
multiple thereof) of the principal amount of Securities of that series or a
denomination larger than the minimum authorized denomination for Securities of
that series pursuant to Section 3.02 in the currency or currency unit in
which the Securities of such series are denominated.

 

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

 

For all purposes of this Subordinated Indenture, unless the context
otherwise requires, all provisions relating to the redemption of 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 Securities which has been
or is to be redeemed.

 

77

 

SECTION 11.04.                      Notice of Redemption.

 

Unless otherwise specified in the Securities of a series, notice of
redemption shall be given in the manner provided in Section 1.06 not later
than 30 days and not earlier than 60 days (or, in the case of partial
redemptions, 45 days) prior to the Redemption Date, to each Holder of
Securities to be redeemed and, with respect to the Perpetual Subordinated
Capital Securities, the Subordinated Trustee, the Calculation Agent and any
Paying Agent of such series.  A notice or
redemption relating to a series of Perpetual Subordinated Capital Securities
shall be irrevocable.

 

All notices of redemption shall state:

 

(1)                                  the
Redemption Date;

 

(2)                                  the
Redemption Price;

 

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

 

(4)                                  that
on the Redemption Date the Redemption Price will become due and payable upon
each such Security or portion thereof, and that interest thereon, if any, shall
cease to accrue on and after said date;

 

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

 

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

 

(7)                                  the
Common Code(s), CUSIP number(s) and ISIN, if any, with respect to such
Securities.

 

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 written request, by
the Subordinated Trustee for such Securities in the name and at the expense of
the Issuer.

 

SECTION 11.05.                      Deposit of Redemption Price.

 

Subject in the case of Perpetual Subordinated Debt Securities and
Perpetual Subordinated Capital Securities to the Solvency Condition being
satisfied by the Issuer, on or prior to any Redemption Date, and to any consent
required of the Financial Services Authority having been obtained, the Issuer
shall deposit with the Subordinated Trustee for the Securities to be redeemed
(or, if the Issuer is acting as its own Paying Agent for such Securities,
segregate and hold in trust as provided in Section 10.03) an amount of
money in the currency or currency unit in which the Securities of such series
are payable (except as otherwise specified pursuant to Section 3.01 for
the Securities of such series and except as provided in Sections 3.11(b),
3.11(d) and 3.11(e)) sufficient to pay the principal amount (or, if the context
so requires, lesser amount in the case of Discounted Securities) of (and
premium, if any, thereon), and (except if the Redemption Date shall be an
Interest Payment Date) any accrued interest on and, subject to
Section 3.07, Deferred Interest, if any, on all the Securities which are
to be redeemed on that date.

 

78

 

SECTION 11.06.                      Securities Payable on Redemption Date.

 

(a)                                  Subject,
in the case of Perpetual Subordinated Debt Securities and Perpetual
Subordinated Capital Securities, to the Solvency Condition being satisfied by
the Issuer and such other requirements as may be set out in the terms for a
series being satisfied, and to any consent required of the Financial Services
Authority having been obtained, 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 in the
currency or currency unit in which the Securities of such series are payable
(except as otherwise provided pursuant to Section 3.01 for the Securities of
such series and except as provided in Sections 3.11(b), 3.11(d) and 3.11(e))
and from and after such date (unless the Issuer shall default in the payment of
the Redemption Price) such Securities shall cease to bear interest.  Upon surrender of such Security for
redemption in accordance with said notice, such Security or specified portions
thereof shall be paid by the Issuer at the Redemption Price; provided, however, that unless otherwise specified as
contemplated by Section 3.01, installments of interest on Registered
Securities whose Stated Maturity, if any, 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 Regular
Record Dates according to their terms and the provisions of Section 3.07.

 

If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (or, if the context shall so
require, lesser amount in the case of Discounted Securities) thereof (and
premium, if any, thereon) shall, until paid, bear interest from the Redemption
Date at a rate per annum equal to the rate borne by the Security (or, in the
case of Discounted Securities, the Security’s Yield to Maturity).

 

(b)                                 In
the event that it is so provided for in the Board Resolution or supplemental
indenture pursuant to Section 3.01 hereof establishing the terms of a
particular series of Perpetual Subordinated Capital Securities, a Redemption
Date on which any Deferred Interest Payments are due to be satisfied may be
postponed following the occurrence of a Market Disruption Event, or in other
circumstances where the Issuer is otherwise not able to raise sufficient funds
through the Alternative Coupon Satisfaction Mechanism to satisfy all Deferred
Interest Payments payable on such Redemption Date.  In such event, the Perpetual Subordinated
Capital Securities of such series will remain Outstanding and will continue to
accrue and pay interest in accordance with their terms, and such postponement
of the Redemption Date will not constitute a Capital Security Default.  In addition, to the extent set forth in such
Board Resolution or supplemental indenture, following the 14th day after
postponement of a Redemption Date as described above, interest will accrue on
outstanding Deferred Interest Payments that would otherwise have been satisfied
on such initially scheduled Redemption Date from (and including) such initial
Redemption Date to (but excluding) the date such Deferred Interest Payments are
paid, at the rate of interest applicable to such series of Perpetual
Subordinated Capital Securities.

 

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SECTION 11.07.                      Securities Redeemed in Part.

 

Any Security which is to be redeemed only in part shall be surrendered
at the Place of Payment (with, if the Issuer, the Subordinated Trustee or the
Security Registrar for such Security so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Issuer, the Subordinated
Trustee and the Security Registrar for such Security duly executed by, the
Holder thereof or his attorney duly authorized in writing), and the Issuer
shall execute and such Subordinated 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, of the
same series and having the same terms and provisions and in an aggregate
principal amount equal to and in exchange for the unredeemed portion of the
principal of the Security so surrendered; except that, if a global Security is
so surrendered, the Issuer shall execute, and the Subordinated Trustee shall
authenticate and deliver to the Depositary for such global Security, without service
charge, a new global Security of like tenor in a denomination equal to and in
exchange for the unredeemed portion of the principal amount of the global
Security so surrendered.

 

SECTION 11.08.                      Tax Event Redemption.

 

(a)                                  The
Securities of any series may be redeemed, subject to any other terms set forth
herein and in the Board Resolution or supplemental indenture pursuant to
Section 3.01 hereof establishing the terms of such Securities, and
subject, in the case of Perpetual Subordinated Debt Securities and Perpetual
Subordinated Capital Securities of any series, to the Solvency Condition being
satisfied by the Issuer, as a whole but not in part, at the option of the
Issuer, upon not more than 60 days’ nor less than 30 days’ prior notice to the
Holders of such Securities, at a Redemption Price equal to 100% of the
principal amount thereof (or, if the context so requires, such lesser amount in
the case of Discounted Securities) (and premium, if any, thereon), together
with accrued interest for the then current interest period and Deferred
Interest, if any, thereon to the Redemption Date, and any Securities
convertible or exchangeable into Preference Shares may, at the option of the
Issuer, be converted or exchanged as a whole, upon the occurrence of a Tax Event;
provided, that Securities of any such
series may not be so redeemed if an obligation of the Issuer to pay additional
amounts or to account as provided in the definition of Tax Event arises because
of the official application or interpretation of the laws or regulations
affecting taxation of the country in which the Issuer is organized, or any
political subdivision or taxing authority thereof or therein having power to
tax, as a result of the consolidation, amalgamation or merger of the Issuer
with or into, or the conveyance, transfer or lease by the Issuer of its
properties and assets substantially as an entirety to, any Person.

 

(b)                                 Prior
to the redemption of any series of Securities following the occurrence of a Tax
Event, the Issuer shall be required, before it gives a notice of redemption, to
deliver to the Subordinated Trustee an Officers’ Certificate stating that all
conditions precedent to such redemption have been complied with and an Opinion
of Counsel concluding that in the opinion of such counsel a Tax Event has
occurred and the Issuer is entitled to exercise its right of redemption in
accordance with the terms of the Securities.

 

(c)                                  If
the Issuer provides an Opinion of Counsel in the appropriate jurisdiction,
dated as of the date of the relevant event referred to above, that no
obligation to pay any additional amount or to account as aforesaid arises, then
that Opinion of Counsel shall be final and binding, solely for purposes of this
paragraph, on the Issuer, the Subordinated

 

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Trustee and the Holders of the Securities of any such series as to the
law of the relevant jurisdiction at the date of such Opinion of Counsel.

 

SECTION 11.09.                      Regulatory Event Redemption.

 

(a)                                  Subject
to the Issuer satisfying the Solvency Condition on any applicable date set for
redemption, the Dated Subordinated Debt Securities, the Perpetual Subordinated
Debt Securities and the Perpetual Subordinated Capital Securities of any series
may be redeemed, in whole but not in part, at the option of the Issuer, upon
not more than 60 days’ nor less than 30 days’ prior notice to the holders of
such Securities, at a redemption price equal to 100% of the principal amount
thereof (and premium, if any, thereon), together with accrued interest, if any,
and any Deferred Interest, if applicable, thereon to the date fixed for
redemption if a Regulatory Event is deemed to have occurred.

 

(b)                                 The
rights of the Issuer to redeem the Dated Subordinated Debt Securities, the
Perpetual Subordinated Debt Securities and the Perpetual Subordinated Capital
Securities of any series, upon the occurrence of a Regulatory Event, will be
subject to any conditions (including the consent of the Financial Services
Authority) specified in the Board Resolution or supplemental indenture
establishing the terms of such Securities being satisfied.

 

(c)                                  With
respect to the Dated Subordinated Debt Securities, the Perpetual Subordinated
Debt Securities and the Perpetual Subordinated Capital Securities, in the case
of redemption upon the occurrence of a Regulatory Event, the Issuer shall be
required, before it gives a notice of redemption, to deliver to the
Subordinated Trustee an Officers’ Certificate confirming that all conditions
precedent to such redemption have been complied with.

 

ARTICLE TWELVE

SINKING FUNDS

 

SECTION 12.01.                      Applicability of This Article.

 

Redemption of Securities of any series through operation of a sinking
fund as permitted or required by the terms of any such Securities shall be made
in accordance with such terms and (except as otherwise specified pursuant to
Section 3.01 with respect to Securities of such series) this Article; provided , however, that if any of the terms of any such
Securities shall conflict with any provision of this Article, the terms of such
Securities shall govern; and provided, further,
that the option or obligation of the Issuer to make any sinking fund payment
with respect to any Perpetual Subordinated Debt Securities or Perpetual
Subordinated Capital Securities shall be subject to the Solvency Condition
being satisfied by the Issuer and to any consent required of the Financial
Services Authority having been obtained.

 

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

 

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sinking fund payment may be subject to reduction as provided in
Section 12.02.  Each sinking fund
payment shall be applied to the redemption of Securities of any particular
series as provided for by the terms of Securities of that series.

 

SECTION 12.02.                      Satisfaction of Sinking Fund Payments With Securities.

 

The Issuer (i) may deliver Outstanding Securities of a series (other
than any Securities previously called for redemption), and (ii) may apply as a
credit Securities of a series which have been redeemed either at the election
of the Issuer pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms
of such Securities, in each case in satisfaction of all or any part of any
sinking fund payment with respect to the Securities of such series required to
be made pursuant to the terms of such Securities as provided for by the terms
of such series; provided, however, that such
Securities have not been previously so credited.  Such Securities shall be received and
credited for such purpose by the Subordinated Trustee for such Securities at
the principal amount thereof (or, if the context so requires, such lesser
amount in the case of Discounted Securities) and the amount of such sinking
fund payment shall be reduced accordingly.

 

SECTION 12.03.                      Redemption of Securities for Sinking Fund.

 

Not less than 60 days prior to each sinking fund payment date for any
particular series of Securities (or such shorter period as shall be
satisfactory to the Subordinated Trustee for the Securities of such series),
the Issuer will deliver to the Subordinated Trustee for the Securities of such
series, an Officers’ Certificate specifying the amount of the next ensuing
mandatory sinking fund payment for that series pursuant to the terms of that
series, the portion thereof, if any, which is to be satisfied by payment of
cash in the currency or currency unit in which the Securities of that series
are payable (except as otherwise specified pursuant to Section 3.01 for
the Securities of that series and except as provided in Sections 3.11(b),
3.11(d) and 3.11(e)) and the portion thereof, if any, which is to be satisfied
by delivering and crediting Securities of that series pursuant to
Section 12.02 and shall state the basis for such credit and that such
Securities have not previously been so credited and will also deliver to such
Subordinated Trustee any Securities to be so delivered.  The Issuer or the Subordinated Trustee for
the Securities of such series shall select the Securities to be redeemed upon
such sinking fund payment date in the manner specified in Section 11.03
and cause notice of the redemption thereof to be given in the name of and at
the expense of the Issuer in the manner provided in Section 11.04.  Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 11.06 and 11.07.

 

ARTICLE THIRTEEN

SUBORDINATION OF SECURITIES

 

SECTION 13.01.                      Securities Subordinate to Certain Creditors; Definition of Relative
Rights.

 

(a)                                  General.  The Issuer covenants and agrees, and each
Holder of Securities of each series, by his acceptance thereof, likewise
covenants and agrees, that, to the extent expressly provided in this
Subordinated Indenture or in the Board Resolution or supplemental indenture
pursuant to Section 3.01 establishing the terms of a series of Securities,
the Subordinated Debt Securities of each series shall constitute direct,
unsecured and unconditional obligations of the Issuer, ranking equally and
ratably without any preference

 

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among themselves and, in the event of the bankruptcy or winding up or
liquidation of the Issuer, the claims of the holders thereof shall be
subordinate to, and subject in right of payment to, the prior payment in full
of, all claims of the Senior Creditors of the Issuer with respect to such
Securities as described herein (or in the Board Resolution or supplemental
indenture pursuant to Section 3.01 establishing the terms of such series
of Securities), without any preference among themselves.  To the extent and in the manner set forth
herein or in the Board Resolution or supplemental indenture pursuant to
Section 3.01 establishing the terms of such series of Securities, the
indebtedness represented by any of the Securities and the payment of the
principal of (and premium, if any, on) and interest and Deferred Interest, if
any, on any of the Securities and any payment in connection with any applicable
sinking fund or redemption provisions or the payment of any other sums due on
any such Securities are hereby expressly made subordinate and subject in right
of payment to the prior payment in full, in cash or cash equivalents, to all
claims of Senior Creditors with respect to such series and, with respect to any
Perpetual Subordinated Debt Securities and Perpetual Subordinated Capital
Securities, conditional upon the Solvency Condition being satisfied by the
Issuer as described in paragraph (b) of this Section.

 

(b)                                 No
payment of principal, premium, if any, interest, if any, or Deferred Interest,
if any, or in connection with any sinking fund or redemption provision in
respect of any of the Perpetual Subordinated Debt Securities or Perpetual
Subordinated Capital Securities, and no purchase of any of the Perpetual
Subordinated Debt Securities or Perpetual Subordinated Capital Securities,
beneficially by or for the account of the Issuer or any of the Subsidiaries of
the Issuer shall be made unless two members of the Board of Directors of the
Issuer or the Auditors or (if the Issuer is in bankruptcy, winding up or
liquidation in England and Wales) the liquidator of the Issuer shall have
reported to the Subordinated Trustee within 14 days before such payment or
within 6 months before such redemption or purchase that in their or, as the
case may be, his opinion the Solvency Condition would be satisfied by the
Issuer both at the time of and immediately after such payment, redemption or
purchase.  Any such report shall, in the
absence of manifest error, be treated and accepted by the Issuer, the Subordinated
Trustee, and the Holders of any of the Securities as correct and sufficient
evidence of such satisfaction of the Solvency Condition.

 

(c)                                  Subordination
of Dated Subordinated Debt Securities. 
The rights and claims of the holders of any series of Dated Subordinated
Debt Securities are subordinated to Senior Creditors with respect to such
Securities, or any other subordinated debt securities of the Issuer not
expressed to rank equally with or junior to such Securities.

 

The following are “Senior Creditors”
with respect to any series of Dated Subordinated Debt Securities unless
otherwise provided in the Board Resolution or supplemental indenture pursuant
to Section 3.01 establishing the terms of such Securities: (i) any creditors
who are unsubordinated creditors with claims admitted in the event of the
winding up of the Issuer; (ii) any creditors having claims in respect of
liabilities that are, or are expressed to be subordinated, whether only in the
event of a winding up or otherwise, to the claims of unsubordinated creditors
of the Issuer but not further or otherwise; (iii) any creditor who is a holder
of Securities other than the Dated Subordinated Debt Securities except those
that rank, or are expressed to rank, equally with or junior to such series of
Dated Subordinated Debt Securities.

 

In the event the Issuer is subject to any bankruptcy, winding up or
liquidation proceedings, if the amounts payable with respect to the Dated
Subordinated Debt Securities and any claims ranking pari passu
with any such Securities are not paid in full, the holders of

 

83

 

any such Securities and holders of other claims ranking pari passu with
any such Securities shall share ratably in any distribution of the assets of
the Issuer in proportion to the respective amounts to which they are entitled.

 

(d)                                 Subordination
of Perpetual Subordinated Debt Securities. 
The rights and claims of the holders of any series of Perpetual
Subordinated Debt Securities are subordinated to Senior Creditors with respect
to such Securities, including claims of any holders of Dated Subordinated Debt
Securities or any other subordinated debt securities of the issuer not
expressed to rank equally with or junior to the Perpetual Subordinated Debt
Securities.

 

The following are “Senior Creditors”
with respect to any series of Perpetual Subordinated Debt Securities unless
otherwise provided in the Board Resolution or supplemental indenture pursuant
to Section 3.01 establishing the terms of such Securities: (i) any creditors
who are unsubordinated creditors with claims admitted in the event of the
winding up of the Issuer; (ii) any creditors having claims in respect of
liabilities that are, or are expressed to be subordinated, whether only in the
event of a winding up or otherwise, to the claims of unsubordinated creditors
of the Issuer but not further or otherwise; (iii) any creditor who is a holder
of Securities other than the Perpetual Subordinated Debt Securities except
those that rank, or are expressed to rank, equally with or junior to such series
of Perpetual Subordinated Debt Securities.

 

No principal, premium, if any, and interest and Deferred Interest, if
any, or any sinking fund or redemption payments in respect of any of the
Perpetual Subordinated Debt Securities which under the terms of such Perpetual
Subordinated Debt Securities or the provisions of this Subordinated Indenture
would otherwise be due for payment by the Issuer when the Solvency Condition is
not satisfied (whether or not the Issuer is in bankruptcy, winding up or liquidation)
shall be due and payable (without prejudice to the provisions of
Section 5.03 with respect to a Payment Event), and instead such principal,
premium, if any, and interest and Deferred Interest, if any, or any sinking
fund or redemption payments will become due and payable only if and when and to
the extent that the Issuer could make such payment in whole or in part and the
Issuer could still satisfy the Solvency Condition (whether or not the Issuer is
in bankruptcy, winding up or liquidation) immediately thereafter.

 

In the event of the bankruptcy, winding up or liquidation of the
Issuer, the amount that shall be payable with respect to the Perpetual
Subordinated Debt Securities of each series shall be determined by calculating
the amount, if any, as would have been payable in respect thereof as if, on the
day immediately prior to the commencement of any such bankruptcy, winding up or
liquidation and thereafter, the Holders of such Perpetual Subordinated Debt
Securities were the holders of the most senior class of preference shares of
the Issuer having a preferential right to a return of assets in any such
bankruptcy, winding up or liquidation over the holders of all issued classes of
share capital (including all classes of preference shares of the Issuer) for
the time being, assuming that such preference shares were entitled (to the
exclusion of other rights or privileges) to receive as a return of capital in
such bankruptcy, winding up or liquidation an amount equal to the principal
amount of the Perpetual Subordinated Debt Securities of such series then
Outstanding together with premium, if any, and interest accrued to the date of
repayment, if any.  In the event such
amounts and any claims ranking pari passu are
not paid in full, the holders of such Securities and claims will share ratably
in any such distribution of the assets of the Issuer in proportion to the
respective amounts to which they are entitled

 

84

 

(e)                                  Subordination
of Perpetual Subordinated Capital Securities.  The rights and claims of the holders of any
series of Perpetual Subordinated Capital Securities are subordinated to Senior
Creditors with respect to such Securities, including claims of any holders of
Dated Subordinated Debt Securities, Perpetual Subordinated Debt Securities or
any other subordinated debt securities of the issuer not expressed to rank
equally with or junior to the Perpetual Subordinated Capital Securities.

 

The following are “Senior Creditors”
with respect to any series of Perpetual Subordinated Capital Securities unless
otherwise provided in the Board Resolution or supplemental indenture pursuant
to Section 3.01 establishing the terms of such Securities: (i) any creditors
who are unsubordinated creditors with claims admitted in the event of the
winding up of the Issuer; (ii) any creditors having claims in respect of
liabilities that are, or are expressed to be subordinated, whether only in the
event of a winding up or otherwise, to the claims of unsubordinated creditors of
the Issuer but not further or otherwise; (iii) any creditor who is a holder of
Securities other than the Perpetual Subordinated Capital Securities except
those that are expressed to rank equally with or junior to such series of
Perpetual Subordinated Capital Securities; and (iv) all other creditors having
claims, including other such creditors holding subordinated debt securities,
except those that rank, or are expressed to rank, equally with (including
holders of Parity Securities) or junior to (including holders of Junior
Securities) the claims of any holder of Perpetual Subordinated Capital
Securities of such series.

 

No principal, premium, if any, and interest and Deferred Interest, if
any, or any sinking fund or redemption payments in respect of any of the
Perpetual Subordinated Capital Securities which under the terms of such
Perpetual Subordinated Capital Securities or the provisions of this
Subordinated Indenture would otherwise be due for payment by the Issuer when
the Solvency Condition is not satisfied shall be due and payable (without
prejudice to the provisions of Section 5.03 with respect to a Payment
Event), and instead such principal, premium, if any, and interest and Deferred
Interest, if any, or any sinking fund or redemption payments will become due
and payable only if and when and to the extent that the Issuer could make such
payment in whole or in part and the Issuer could still satisfy the Solvency
Condition immediately thereafter.

 

In the event of the bankruptcy, winding up or liquidation of the
Issuer, the amount that shall be payable with respect to the Perpetual
Subordinated Capital Securities of each series shall be determined by
calculating the amount, if any, as would have been payable in respect thereof
as if, on the day immediately prior to the commencement of any such bankruptcy,
winding up or liquidation and thereafter, the Holders of such Perpetual
Subordinated Capital Securities were the holders of preference shares in the
capital of the Issuer having a preferential right to a return of assets in the
winding up over the holders of the ordinary shares of the Issuer (but pari passu with the most senior ranking class of issued
preference shares of the Issuer, if any, except to the extent such preference
shares represent claims of Senior Creditors), assuming that such preference
shares were entitled (to the exclusion of other rights or privileges) to
receive as a return of capital in such bankruptcy, winding up or liquidation an
amount equal to the principal amount of the Perpetual Subordinated Capital
Securities of such series then Outstanding together with premium, if any,
interest accrued to the date of repayment, if any, and Deferred Interest to the
extent provided for pursuant to Section 3.01.  In the event such amounts and any claims
ranking pari passu are not paid in full, the
holders of such Securities and claims will share ratably in any such
distribution of the assets of the Issuer in proportion to the respective
amounts to which they are entitled.

 

(f)                                    Order of Payment.  In
the event of the bankruptcy, winding up or liquidation of the Issuer, all
amounts in respect of any of the Securities issued by such Issuer paid to the

 

85

 

Subordinated Trustee for the Securities of any series by the applicable
liquidator of the Issuer in the bankruptcy, winding up or liquidation of the
Issuer shall be held by such Subordinated Trustee upon trust:

 

(1)                                  firstly,
for payment or satisfaction of the costs, charges, expenses (including
reasonable counsel fees) and liabilities incurred by such Subordinated Trustee
in or about the execution of the trusts of these presents (including any unpaid
remuneration for such Subordinated Trustee);

 

(2)                                  secondly,
for payment of claims of all Senior Creditors with respect to Dated
Subordinated Debt Securities in the bankruptcy, winding up or liquidation of
the Issuer to the extent that such claims are admitted to proof in the
bankruptcy, winding up or liquidation (not having been satisfied out of the
other resources of the Issuer) excluding interest accruing after commencement
of the bankruptcy, winding up or liquidation;

 

(3)                                  thirdly,
for payment pari passu and ratably of the amounts
owing on or in respect of all Dated Subordinated Debt Securities of any such series
issued hereunder by such Issuer;

 

(4)                                  fourthly,
for the payment of claims of all Senior Creditors with respect to Perpetual
Subordinated Debt Securities in the bankruptcy, winding up or liquidation of
the Issuer to the extent that such claims are admitted as proof in the
bankruptcy, winding up or liquidation (not having been satisfied out of the
other resources of the Issuer) excluding interest accruing after commencement
of the bankruptcy, winding up or liquidation;

 

(5)                                  fifthly,
for payment pari passu and ratably of the amounts
owing on or in respect of all Perpetual Subordinated Debt Securities of any
series issued hereunder by such Issuer; and

 

(6)                                  sixthly,
for the payment of claims of all Senior Creditors with respect to Perpetual
Subordinated Capital Securities in the bankruptcy, winding up or liquidation of
the Issuer to the extent that such claims are admitted as proof in the
bankruptcy, winding up or liquidation (not having been satisfied out of the
other resources of the Issuer) excluding interest accruing after commencement
of the bankruptcy, winding up or liquidation;

 

(7)                                  seventhly,
for payment pari passu and ratably of the amounts
owing on or in respect of all Perpetual Subordinated Capital Securities of any
series issued hereunder by such Issuer.

 

The trust mentioned above may be performed by the Subordinated Trustee
paying over to the applicable liquidator the amounts received by the
Subordinated Trustee as aforesaid (less any amounts thereof applied in the
implementation of such trust) on terms that such liquidator shall distribute
the same accordingly and the receipt of such liquidator for the same shall be a
good discharge to the Subordinated Trustee for the performance by it of such
trust.  The Subordinated Trustee shall be
entitled and it is hereby authorized to call for and to accept as conclusive
evidence thereof a certificate from the applicable liquidator as to: (i) the
amount of the claims of the Senior Creditors with respect to each series of
Subordinated Debt Securities referred to above; and (ii) the Persons entitled
thereto and their respective entitlements.

 

86

 

(g)                                 Amounts
Held in Trust.  The provisions of
this Section shall not be applicable to any amounts of principal, premium,
if any, and interest and Deferred Interest, if any, or any amounts in
connection with any applicable sinking fund or redemption provisions or payment
of any other sums due on any such Securities, in respect of any of the
Securities for the payment of which funds have been deposited in trust with the
Subordinated Trustee or any Paying Agent or have been set aside by the Issuer
in trust in accordance with the provisions of this Subordinated Indenture; provided, however, that at the time of such deposit or setting
aside, and immediately thereafter, the foregoing provisions of this
Section are complied with.

 

(h)                                 Subrogation.  In a bankruptcy, winding up or liquidation in
England and Wales of the Issuer, subject to the satisfaction in full of all
claims of Senior Creditors of the Issuer admitted in such bankruptcy, winding
up or liquidation, the Holders of the Securities shall be subrogated (pro rata
with the holders (or the trustees for such holders) of other pari passu claims, including the Holders of all other
Securities issued hereunder on the basis of the respective amounts paid over,
directly or through the applicable liquidator, to or for the benefit of such
Senior Creditors) to the rights of such Senior Creditors to receive payments or
distributions of cash, property or securities of the Issuer applicable to
claims of such Senior Creditors until the principal, premium, if any, and
interest, if any, in respect of any such Securities, shall be paid in full;
and, for the purposes of such subrogation, no payments or distributions to such
Senior Creditors of cash, property or securities of the Issuer to which any
such Holders or the Subordinated Trustee would be entitled except for the
provisions of this Section, and no payment over by any such Holders or the Subordinated
Trustee, directly or through the applicable liquidator, to or for the benefit
of such Senior Creditors pursuant to the provisions of this Section, shall, as
between the Issuer, its creditors other than such Senior Creditors, and any
such Holders and the Subordinated Trustee be deemed to be a payment by the
Issuer to or on account of such Senior Creditors.

 

SECTION 13.02.                      Provisions Solely to Define Relative Rights.

 

The provisions of this Article Thirteen are and are intended
solely for the purpose of defining the relative rights of the Holders of the
Securities of each series on the one hand and the Senior Creditors of the
Issuer on the other hand.  Other than as
provided for in this Subordinated Indenture, any Board Resolutions or
supplemental indentures pursuant to Section 3.01 with respect to any
series of Securities, nothing contained in this Article or elsewhere in
this Subordinated Indenture or in the Securities is intended to or shall (a)(i)
impair, as among the Issuer, its creditors (other than Senior Creditors) and
the Holders of any Securities issued by such Issuer, the obligation of the
Issuer, which is absolute and unconditional, to pay to the Holders of such
claims the principal of, premium, if any, on and interest and Deferred Interest,
if any, on such Securities as and when the same shall become due and payable in
accordance with their terms and this Subordinated Indenture or (ii) affect the
relative rights against such Issuer of the Holders of any such Securities and
creditors of such Issuer (other than the Senior Creditors) or (iii) prevent the
Subordinated Trustee or such Holders from exercising all remedies otherwise
permitted by applicable law upon default under this Subordinated Indenture,
subject to the rights, if any, under this Article of the Senior Creditors
of the Issuer to receive cash, property or securities otherwise payable or
deliverable to the Subordinated Trustee or such Holders; or (b) prevent the
Subordinated Trustee or such Holders from exercising all remedies otherwise
permitted by applicable law upon default under this Subordinated Indenture.

 

87

 

SECTION 13.03.                      Subordinated Trustee to Effectuate Subordination.

 

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

 

SECTION 13.04.                      No Waiver of Subordination Provisions.

 

No right of any present or future Senior Creditors of the Issuer, if
any, to enforce subordination as herein provided shall at any time in any way
be prejudiced or impaired by any act or failure to act on the part of the
Issuer or by any act or failure to act, in good faith, by any such Senior
Creditors of the Issuer, if any, or by any non-compliance by the Issuer with
the terms, provisions and covenants of this Subordinated Indenture, regardless
of any knowledge thereof that any such Senior Creditors of the Issuer, if any,
may have or be otherwise charged with.

 

SECTION 13.05.                      Notice to Subordinated Trustee.

 

The Issuer shall give prompt written notice to the Subordinated Trustee
of any fact known to it which would prohibit the making of any payment when due
to or by the Subordinated Trustee in respect of any Securities.  Notwithstanding the provisions of this
Article or any other provision of this Subordinated Indenture but subject
to the provisions of Section 13.01, the Subordinated Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment when due to or by the Subordinated Trustee in respect of
any such Securities unless and until the Subordinated Trustee shall have
received written notice thereof from the Issuer or a Senior Creditor of such
Issuer, as the case may be, or from any trustee therefor, as the case may be;
and, prior to the receipt of any such written notice by a Responsible Officer
of the Subordinated Trustee, the Subordinated Trustee, subject to the
provisions of Section 6.01, shall be entitled in all respects to assume
that no such facts exist; provided, however,
that if the Subordinated Trustee shall not have received the notice provided
for in this Section at least three Business Days prior to the date upon
which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium,
if any, on) and interest and Deferred Interest, if any, on any Security), then,
subject to the provisions of Section 13.01, the Subordinated Trustee shall
have full power and authority to receive such money and to apply the same to
the purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it within three Business Days
prior to such date.

 

Subject to the provisions of Section 6.01, the Subordinated
Trustee shall be entitled to conclusively rely on the delivery to it of a
written notice by a Person representing himself to be a Senior Creditor or a
trustee therefor, to establish that such notice has been given by a Senior
Creditor of such Issuer or a trustee therefor. 
In the event that the Subordinated Trustee determines in good faith that
further evidence is required with respect to the right of any Person as a
Senior Creditor of such Issuer to participate in any payment or distribution
pursuant to this Article, the Subordinated Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Subordinated Trustee as
to the amount of claims held by such Person, and if such evidence is not
furnished, the Subordinated Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

 

88

 

SECTION 13.06.                      Reliance on Judicial Order or Certificate of Liquidating Agent.

 

Upon any payment or distribution of assets of the Issuer referred to in
this Article, the Subordinated Trustee, subject to the provisions of
Section 6.01, and the Holders of the Securities shall be entitled to
conclusively rely upon (i) any order or decree entered by any court in England
and Wales in which any bankruptcy, winding up or liquidation of the Issuer, if
any, or similar case or proceeding, including a proceeding for the suspension
of payments under English and Welsh law, is pending, or (ii) a certificate of
the applicable liquidator, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Subordinated
Trustee and such Holders, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the Senior Creditors of the
Issuer, if any, as the case may be, and other claims against such Issuer the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article.

 

SECTION 13.07.                      Subordinated Trustee Not Fiduciary for Creditors.

 

The Subordinated Trustee shall not be deemed to owe any fiduciary duty
to the Senior Creditors of the Issuer, if any, as the case may be, and shall
not be liable to any such holders if it shall in good faith mistakenly pay over
or distribute to Holders of the Securities or to the Issuer or to any other
Person cash, property or securities to which any such Senior Creditors or
depositors and other creditors shall be entitled by virtue of this Article or
otherwise.  With respect to the Senior
Creditors, the Subordinated Trustee undertakes to perform or to observe only
such of its covenants or obligations as are specifically set forth in this
Article and no implied covenants or obligations with respect to the Senior
Creditors shall be read into this Indenture against the Subordinated Trustee.

 

SECTION 13.08.                      Rights of Subordinated Trustee as Creditor; Preservation of
Subordinated Trustee’s Rights.

 

The Subordinated Trustee in its individual capacity shall be entitled
to all the rights set forth in this Article with respect to any claims of
Senior Creditors of the Issuer, if any, as the case may be, which may at any
time be held by it, to the same extent as any other Senior Creditors of the Issuer,
if any, as the case may be, and nothing in this Subordinated Indenture shall
deprive the Subordinated Trustee of any of its rights as such holder.

 

Nothing in this Article shall apply to claims of, or payments to,
the Subordinated Trustee under or pursuant to Section 6.07.

 

SECTION 13.09.                      Article Applicable to Paying Agents.

 

In case at any time any Paying Agent other than the Subordinated
Trustee shall have been appointed by the Issuer and be then acting hereunder,
the term “Subordinated Trustee” as used in this Article shall in such case
(unless the context otherwise requires) be construed as extending to and
including such Paying Agent within its meaning as fully for all intents and
purposes as if such Paying Agent were named in this Article in addition to
or in place of the Subordinated Trustee; provided, however, that
Section 13.08 shall not apply to the Issuer or any Affiliate of the
Issuer, if the Issuer or such Affiliate acts as Paying Agent.

 

89

 

SECTION 13.10.                      Conversion or Exchange Not Deemed Payment.

 

For the purposes of this Article Thirteen only, delivery of
Preference Shares upon conversion or exchange of Securities in accordance with
Article Fourteen, if applicable to a particular series of Securities,
shall not be treated as constituting a payment or distribution on account of
the principal of the Securities or on account of the purchase or other
acquisition of the Securities.  Nothing
contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Issuer, its creditors
and the Holders of the Securities, the right, which if applicable to a
particular series of Securities is absolute and unconditional, of the Issuer to
convert or exchange the Securities in accordance with Article Fourteen.

 

ARTICLE FOURTEEN

 

CONVERSION
OR EXCHANGE OF SECURITIES

 

SECTION 14.01.                      Applicability of Article.

 

If specified pursuant to
Section 3.01 for the Securities of any series, the Securities of such
series shall be convertible or exchangeable in accordance with their terms and
(except as otherwise specified as contemplated by Section 3.01 for
Securities of such series) in accordance with this Article.  Unless otherwise specified pursuant to
Section 3.01 for the Securities of any series, the Securities of each
series shall be convertible or exchangeable, at the Issuer’s option and in its
sole discretion, in whole or in part, into Preference Shares in each case in
accordance with this Article.

 

SECTION 14.02.                      Election to Convert or Exchange; Notice to Subordinated Trustee.

 

An election of the Issuer
to convert or exchange Securities, as the case may be, shall be evidenced by an
Officers’ Certificate furnished to the Subordinated Trustee stating that the
Issuer is entitled to effect such conversion or exchange and setting forth a
statement of facts demonstrating the same.

 

SECTION 14.03.                      Notice of Conversion or Exchange

 

Not less than
30 days nor more than 60 days prior to the Event Date, the Issuer
shall notify the Subordinated Trustee in writing of its election to convert or
exchange, as the case may be, the Securities and of the series of Securities to
which such election relates.  The
Subordinated Trustee shall within five Business Days after receipt of such
notice from the Issuer and at the expense of the Issuer, cause notice of such
election to be mailed to each Holder of Securities to be converted or
exchanged, as the case may be.

 

All notices of conversion or exchange shall be prepared by the Issuer
and shall state:

 

(1)                                  the Event Date;

 

(2)                                  if less than all of
the series of the Securities are to be converted or exchanged, the
identification of the particular Securities to be converted or exchanged,
including relevant CUSIP numbers and other securities identification numbers,
which Securities shall be selected by the Subordinated Trustee from the
Outstanding Securities of such series not previously called for conversion, by
such

 

90

 

method as the Subordinated Trustee shall deem fair and appropriate provided, that if on the Event Date such
Securities are registered as a global security, the Depositary shall determine,
in accordance with its procedures, the principal amount of such Securities held
by each of the Depositary’s participants to be converted or exchanged;

 

(3)                                  that on the Event
Date, the Security to be converted or exchanged will cease to exist except, if
applicable, to evidence the Preference Shares as described in
Section 14.07 below on and after such Event Date;

 

(4)                                  if such Securities
are not registered as a global security, the place or places where such
Securities are to be surrendered for conversion or exchange;

 

(5)                                  the form in which the
Issuer will issue the Preference Shares.; and

 

(6)           such
information as may be set out in a supplemental indenture or Board Resolution
pursuant to Section 3.01.

 

SECTION 14.04.                      Deposit of Payments.

 

Prior to 10:00 a.m., New York time, on any Event Date, the Issuer shall
deposit with the Subordinated Trustee or with a Paying Agent an amount of money
sufficient to pay accrued interest, if any, to the Event Date on the Securities
to be converted or exchanged on the Event Date.

 

SECTION 14.05.                      Surrender of Securities.

 

Without prejudice to the Issuer’s right to convert or exchange the
Securities, any  Security which is to be
converted or exchanged shall, unless such Security is registered as a global
security, be surrendered at an office or agency of the Issuer designated for
that purpose pursuant to Section 10.02 not less than 10 days prior to the
Event Date (with due endorsement by, or a written instrument of transfer in
form satisfactory to the Issuer and the Subordinated Trustee duly executed by
the Holder thereof or his attorney-in-fact duly authorized in writing) accompanied
by written notice specifying the name or names with address or addresses in
which the Preference Shares, are to be issued. 
The Subordinated Trustee will inform the Issuer of all such notices and
the Issuer will, if applicable, direct the ADR Depositary accordingly under the
terms of the ADR Deposit Agreement.  Securities surrendered for conversion or
exchange shall, if surrendered to any Person other than the Subordinated
Trustee, be delivered to the Subordinated Trustee for delivery by it to the
Issuer or, if delivered to the Subordinated Trustee, shall be delivered by it
to the Issuer.

 

SECTION 14.06.                      Issuance of Preference Shares.

 

On or prior to the Event Date with respect to Securities surrendered
for conversion or exchange, the Issuer shall, unless the Issuer shall have
notified the Subordinated Trustee otherwise in writing not less than 30 days
nor more than 60 days prior to the Event Date, deliver or procure the delivery
of a single share warrant to bearer to the ADR Depositary evidencing all of the
Preference Shares in respect of which such Securities are to be converted in
accordance with the provisions of this Article Fourteen.  Such conversion or exchange shall be deemed
to have been made immediately prior to the close of business in New York City
on the Event Date.

 

In the event that the
Issuer shall have notified the Subordinated Trustee that it will not deliver or
procure the delivery of a single share warrant to

 

91

 

bearer in exchange for the
Securities of a series subject to the conversion or exchange as provided in
Section 14.05: (i) the Issuer shall, on or prior to the Event Date, with
respect to definitive Securities, deliver or procure the delivery of individual
certificates representing the Preference Shares (or evidencing the rights to
receive such Preference Shares) of such series for which such Securities are to
be converted or exchanged in accordance with the provisions of this
Article Fourteen; or (ii) in the case of Preference Shares in registered
form, such Preference Shares shall be registered in the names of the Holders of
such Securities in definitive form as they appear on the Security Register or,
at the direction of such Holder, in the name of the ADR Custodian for the account
and benefit of the ADR Depositary who will issue ADRs evidencing ADSs
representing the Preference Shares to such Holder; or (iii) in the case of
Preference Shares evidenced by share warrants to bearer, such Preference Shares
shall be delivered to the bearer of the bearer Security in definitive form or,
at the direction of such bearer, to the ADR Custodian for the account and
benefit of the ADR Depositary who will issue ADRs evidencing ADSs representing
Preference Shares to such Holder.

 

Any exchange or conversion
shall be deemed to have been made immediately prior to the close of business in
New York City on the Event Date.

 

SECTION 14.07.                      Effect of Conversion or Exchange.

 

Notice of conversion or
exchange having been given as aforesaid, the Securities so to be converted or
exchanged, as the case may be, shall on the Event Date cease to exist for any
purpose, other than to evidence the Preference Shares as described below.  Upon the Event Date accrued interest, if any,
on such Security to the Event Date and all other amounts due and owing
hereunder shall be paid by the Issuer to the Holder surrendering such Security.
Such payment shall be a condition to the conversion or exchange and no
conversion or exchange shall occur unless such payments are made.

 

On and after the Event Date, each Security converted or exchanged,
until surrendered, shall be deemed to evidence the right to receive the
Preference Shares with a liquidation preference equivalent to the principal
amount of such Security upon such surrender. 
On and after the Event Date, until a Holder of a Security has
surrendered such Security, such Holder shall be entitled to receive any
dividends, payments or other distributions in respect of such Preference Shares
and shall have the same rights with respect to, and shall be deemed to be the
Holder of, such Preference Shares as if it had so surrendered such Security on or
prior to the Event Date; provided, however, that no dividends, payments
or other distributions in respect of such Preference Shares shall be paid or
distributed to such Holder any earlier than the date on which such Security is
surrendered.

 

SECTION 14.08.                      Validity of Preference Shares, Depositary Agreement and ADRs.

 

The Issuer shall take all
corporate and other action which may be necessary in order that it may validly
and legally issue Preference Shares upon each conversion or exchange of the
Outstanding Securities.  The Issuer
covenants that the Preference Shares will when issued upon such conversion or
exchange be duly authorized and validly issued, fully paid, free of all liens
and charges, and not subject to calls for further funds.

 

The Issuer will take all
corporate or other action which may be necessary to ensure (i) the validity and
enforceability of the Depositary Agreement and (ii) that the applicable ADRs

 

92

 

may be validly and
legally issued upon each conversion or exchange of the Outstanding Securities
for Preference Shares.

 

SECTION 14.09.                      Legal and Regulatory Compliance.

 

Notwithstanding any
provision of this Subordinated Indenture to the contrary, the right of the
Issuer to cause any conversion or exchange of the Securities of any series for
Preference Shares on any proposed Event Date shall, unless otherwise provided
in a supplemental indenture or Board Resolution pursuant to Section 3.01, be
subject to the fulfillment of the following conditions with respect to such
Securities of such series, and the Issuer represents and warrants for the
benefit of the holders of Preference Shares that all such conditions shall have
been satisfied prior to any such conversion or exchange on the Event Date:

 

(1)                                  as
of such Event Date, there shall be no accrued but unpaid interest (including Deferred
Interest) outstanding on the Securities of such Series (including amounts paid
on the Event Date) or other unpaid amounts then due and owing hereunder;

 

(2)                                  as
of such Event Date, no Event of Default, Payment Default, Payment Event or
Capital Security Event Default shall have occurred and be continuing with
respect to the particular series of Securities;

 

(3)                                  as
of such Event Date, there has not been, in any one instance or in the
aggregate, an adverse effect on the rights, powers, privileges, validity or
enforceability of the Preference Shares, the ADRs or the Deposit Agreement;

 

(4)                                  the
Preference Shares to be issued on such Event Date shall be duly authorized and
reserved for issuance upon such conversion and when issued upon such exchange,
will be fully paid and not subject to calls for further funds;

 

(5)                                  no
consents, authorizations, approvals or exemptions, except in each case such as
shall have been obtained, will be required prior to such Event Date for the
issuance and delivery of the Preference Shares to be issued upon such
conversion or exchange or the ADRs;

 

(6)                                  the
issuance and delivery of the Preference Shares and the ADRs to be issued on
such Event Date shall not violate (i) the Articles of Association of the Issuer
or (ii) any law, rule or regulation applicable to the Issuer;

 

(7)                                  there
shall have not occurred any change in law in England, or any amendment of the
Articles of Association of the Issuer, prior to such Event Date, materially and
adversely affecting the rights and privileges attached to the Preference Shares
or the ADRs (including, without limitation, the rights of the holders thereof
in the event of a bankruptcy or other similar proceeding with respect to the
Issuer) or such holders’ access to the courts of the United Kingdom and other
applicable governmental authorities to enforce such rights; and

 

(8)                                  such
other condition(s) as may be set out in a supplemental indenture or Board
Resolution pursuant to Section 3.01.  

 

SECTION 14.10.                      Taxes and Charges.

 

Unless otherwise
specified pursuant to Section 3.01, the issuance and delivery of
Preference Shares upon conversion or exchange of the Securities of any series
pursuant to this Article Fourteen shall be made without charge to the
converting or exchanging Holder of Securities for such Preference Shares, or
for any tax or other governmental charge (other than

 

93

 

taxes on income or
capital gains) in respect of the issuance or delivery of such Preference
Shares; provided, however, that the Issuer shall not be required to pay any tax
or other governmental charge which may be payable in respect of (a) issuance or
delivery of Preference Shares by or at the direction or request of a Holder
thereof to any Person who is or is a nominee or agent for a Person whose
business is or includes the provision of clearance services within the meaning
of Section 70 or Section 96 of the Finance Act of 1986 or whose
business is or includes issuing depositary receipts within the meaning of
Section 67 or Section 93 of the Finance Act of 1986, other than the
ADR Depositary or ADR Custodian or any successor thereto, all such Persons
being “Excepted Persons”, or (b) a transfer involved in the issuance and
delivery of any such Preference Shares to any Person other than any Holder (not
being an Excepted Person) of the Security to be converted or exchanged (unless
such other person is the securities depositary selected by the Issuer for the
Securities of such series), and, without prejudice to the Issuer’s right to
convert or exchange the Securities, the Issuer shall not be required to issue
or deliver or procure the delivery of such Preference Shares unless and until
the Person requesting the issuance or delivery thereof shall have paid to the
Issuer the amount of such tax or other governmental charge or shall have
established to the satisfaction of the Issuer that such tax or other
governmental charge has been paid.

 

SECTION 14.11.                      Subordinated Trustee Not Liable.

 

The Subordinated Trustee
shall not be accountable with respect to the validity or value (or the kind or
amount) of any Preference Shares which may be issued or delivered upon the
conversion or exchange of any Security pursuant to this Article Fourteen,
and makes no representation with respect thereto.  The Subordinated Trustee shall not be
responsible for any failure of the Issuer to issue, transfer or deliver or
procure the delivery of any Preference Shares upon the surrender of any
Security for the purpose of a conversion or exchange pursuant to this
Article Fourteen or to comply with any of the covenants of the Issuer
contained in this Article Fourteen.

 

*    *    *

 

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

 

94

 

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

 

	
   

  	
  PRUDENTIAL plc,

  
	
   

  	
   

  
	
   

  	
  as Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CITIBANK, N.A.

  
	
   

  	
   

  
	
   

  	
  as Subordinated
  Trustee

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

95

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