Document:

Exhibit 10.1

 

HELICOS
BIOSCIENCES CORPORATION

 

CORPORATE
OFFICER SEVERANCE PLAN

 

Helicos BioSciences Corporation (the “Company”) sets
forth herein the terms of its Corporate Officer Severance Plan (the “Plan”) as
follows:

 

SECTION 1.  PURPOSE

 

The purpose of this Plan is to provide severance
benefits to officers of the Company in the event of involuntary termination of
employment.  This document constitutes
the official plan document of the Plan, an employee welfare benefit plan under
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

 

SECTION 2.  DEFINITIONS

 

(a)                                  “Accrued
Obligations” means, with respect to an Employee, the sum of (i) the
Employee’s earned compensation through the Date of Termination to the extent
not theretofore paid, and (ii) any accrued vacation pay to the extent not
theretofore paid.

 

(b)                                 “Base
Pay” means the Employee’s annual base salary prior to any pre-tax deductions,
but shall not include bonus payments, 401(k) matching contributions or any
other payments not specifically provided for under the Plan.

 

(c)                                  “Board”
means the Board of Directors of the Company.

 

(d)                                 “Cause”
means any of the following:

 

(i)                                    the substantial and continuing failure or
refusal of the Employee, after written notice thereof, to reasonably attempt to
perform his or her job duties and responsibilities (other than failure or
refusal resulting from incapacity due to physical disability or mental illness)
which failure or refusal is committed in bad faith and is not in the best
interest of the Company;

 

(ii)                                  gross negligence, willful misconduct or
material breach of fiduciary duty to the Company;

 

(iii)                               the willful commission of an act of embezzlement, misappropriation or
fraud;

 

(iv)                              deliberate and willful disregard of the written rules or policies
of the Company which results in a material and substantial loss, damage or
injury to the Company;

 

 

(v)                                 the unauthorized, deliberate and willful
disclosure of any material confidential, proprietary and/or trade secret
information of the Company or its customers which disclosure is committed in
bad faith  and is not in the best
interest of the Company;

 

(vi)                              the willful and deliberate commission of an
act which induces any customer, supplier, employee or consultant to adversely
and substantially amend or terminate their relationship with the Company which
act is committed in bad faith and is not in the best interest of the Company;
or

 

(vii)                           the conviction of, or plea of nolo contendere by the Employee, to a
crime involving  a felony of moral
turpitude.

 

(e)                                  A
“Change in Control” shall be deemed to have occurred upon the occurrence of any
one of the following events:

 

(i)                                     any
“Person,” as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Act”) (other than the
Company, any of its subsidiaries, or any trustee, fiduciary or other person or
entity holding securities under any employee benefit plan or trust of the
Company or any of its subsidiaries), together with all “affiliates” and “associates”
(as such terms are defined in Rule 12b-2 under the Act) of such person,
shall become the “beneficial owner” (as such term is defined in Rule 13d-3
under the Act), directly or indirectly, of securities of the Company
representing 50 percent or more
of the combined voting power of the Company’s then outstanding securities
having the right to vote in an election of the Company’s Board of Directors (“Voting
Securities”) (in such case other than as a result of an acquisition of
securities directly from the Company); or

 

(ii)                               persons
who, as of the date hereof, constitute the Company’s Board of Directors (the “Incumbent
Directors”) cease for any reason, including, without limitation, as a result of
a tender offer, proxy contest, merger or similar transaction, to constitute at
least a majority of the Board, provided that any person becoming a director of
the Company subsequent to the date hereof shall be considered an Incumbent
Director if such person’s election was approved by or such person was nominated
for election by either (A) a vote of at least a majority of the Incumbent
Directors or (B) a vote of at least a majority of the Incumbent Directors
who are members of a nominating committee comprised, in the majority, of
Incumbent Directors; but provided further, that any such person 

 

2

 

whose initial assumption
of office is in connection with an actual or threatened election contest
relating to the election of members of the Board of Directors or other actual
or threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board, including by reason of agreement intended to avoid or
settle any such actual or threatened contest or solicitation, shall not be
considered an Incumbent Director; or

 

(iii)                               the
consummation of (A) any consolidation or merger of the Company where the
stockholders of the Company, immediately prior to the consolidation or merger,
would not, immediately after the consolidation or merger, beneficially own (as
such term is defined in Rule 13d-3 under the Act), directly or indirectly,
shares representing in the aggregate more than 50 percent of the voting shares
of the Company issuing cash or securities in the consolidation or merger (or of
its ultimate parent corporation, if any), or (B) any sale, lease, exchange
or other transfer (in one transaction or a series of transactions contemplated
or arranged by any party as a single plan) of all or substantially all of the
assets of the Company; or

 

(iv)                              the
approval by the Company’s stockholders of any plan or proposal for the
liquidation or dissolution of the Company.

 

(f)                                    “Code”
means Internal Revenue Code of 1986, as amended.

 

(g)                                 “Committee”
means the Compensation Committee of the Board.

 

(h)                                 “Date
of Termination” means, with respect to an Employee, the effective date of
termination of the Employee’s employment with the Company.

 

(i)                                     “Employee”
means an officer of the Company at the Vice-President level or above who
receives a Notification Letter (as defined below) from the Company as approved
by the Committee.

 

(j)                                     “Severance
Period” means the number of weeks described in the Employee’s notification
letter in the form set forth on Schedule A (the “Notification Letter”) for
which benefits are provided pursuant to Section 3(a).

 

SECTION 3.  SEVERANCE
BENEFITS

 

(a)                                  If
the Company terminates an Employee’s employment involuntarily prior to a Change
in Control, and such involuntary termination is not for Cause or by reason of
death or disability, the Company shall pay to the Employee the following
amounts:

 

(i)                                     the
Accrued Obligations in a lump sum in cash within ten business days of the Date
of Termination;

 

3

 

(ii)                                  the
severance benefits provided in the Employee’s individual Notification Letter
(the “Severance Benefits”); provided  however, that the Employee
has executed a Waiver and Release substantially in the form set forth in Schedule
B, and the revocation period for such Waiver and Release has passed;

 

(iii)                               the
continuation of health and dental benefits to the Employee and/or the Employee’s
family at the active employee premium rate during the Severance Period.  The continuation coverage under this
subsection shall count towards the obligation of the Company to provide COBRA
continuation coverage; and

 

(iv)                              outplacement
services as described in the Employee’s individual Notification Letter (the “Outplacement
Services”).

 

(b)                                 The
Company shall pay the severance benefits in a lump sum in cash within ten
business days after the revocation period for such Waiver and Release has
passed.  All severance benefits provided
to an Employee pursuant to Section 3(a) shall be reduced and/or
offset by any notice, payments or benefits to which the Employee may be
entitled under the federal Worker Adjustment and Retraining Notification (WARN)
Act, 29 U.S.C. § 2101 et seq., as amended, and any applicable state plant or
facility closing or mass layoff law.

 

(c)                                  If
an Employee’s employment is terminated for Cause or the Employee dies, becomes
disabled or voluntarily terminates employment for any reason, the Employee
shall only be entitled to his Accrued Obligation.

 

SECTION 4.  WITHHOLDING

 

Notwithstanding anything in this Plan to the contrary,
all payments required to be made by the Company hereunder to an Employee or his
estate or beneficiaries shall be subject to the withholding of such amounts
relating to taxes as the Company reasonably may determine it should withhold
pursuant to any applicable law or regulation. 
In lieu of withholding such amounts, in whole or in part, the Company may,
in its sole discretion, accept other provisions for the payment of taxes and
any withholdings as required by law, provided that the Company is satisfied
that all requirements of law affecting its responsibilities to withhold compensation
have been satisfied.

 

SECTION 5.  ADMINISTRATION

 

The Plan shall be administered by either the Committee
or the person(s) appointed by the Board from time to time to administer
the Plan (in either case, the “Administrator”). 
The Administrator shall have the full power, authority and discretion to
interpret the terms and provisions of the Plan, to make all determinations it
deems advisable for the administration of the Plan, to decide all disputes
arising in connection with the Plan and to otherwise supervise the
administration of the Plan.  All
decisions and interpretations of the Administrator shall be binding on all
persons.

 

4

 

SECTION 6.  GOVERNING LAW

 

This Plan shall be governed by the laws of the United
States to the extent applicable and otherwise by the laws of the Commonwealth
of Massachusetts, excluding the choice of law rules thereof.

 

SECTION 7.  SEVERABILITY

 

If any part of any provision of this Plan shall be
invalid or unenforceable under applicable law, such part shall be ineffective
to the extent of such invalidity or unenforceability only, without in any way
affecting the remaining parts of such provision or the remaining provisions of
this Plan.

 

SECTION 8.  DISCLAIMER OF
RIGHTS

 

No provision in this Plan shall be construed to confer
upon any individual the right to remain in the employ or service of the Company
or any related entities, or to interfere in any way with any contractual or
other right or authority of the Company either to increase or decrease the
compensation or other payments to any individual at any time, or to terminate
any employment or other relationship between any individual and the Company or
any related entities.  The obligation of
the Company to pay any benefits pursuant to this Plan shall be interpreted as a
contractual obligation to pay only those amounts described herein, in the
manner and under the conditions prescribed herein.  The Plan shall in no way be interpreted to
require the Company to transfer any amounts to a third party trustee or
otherwise hold any amounts in trust or escrow for payment to any participant or
beneficiary under the terms of the Plan.

 

SECTION 9.  CLAIMS
PROCEDURES.

 

(a)                                  If
an Employee asserts a right to a benefit under the Plan which has not been
received, the Employee must file a claim for such benefit with the
Administrator.  The Administrator shall
render its decision on the claim within 90 days after its receipt of the claim.

 

If special circumstances apply, the 90-day period may
be extended by an additional 90 days, provided that written notice of the
extension is provided to the Employee during the applicable period and such
notice indicates the special circumstances requiring an extension of time and
the date by which the Administrator expects to render its decision on the
claim.

 

(b)                                 If
the Administrator wholly or partially denies the claim, the Administrator shall
provide written notice to the Employee within the time limitations of the
immediately preceding paragraph.  Such
notice shall set forth:

 

(i)                                     the
specific reasons for the denial of the claim;

 

(ii)                                  specific
reference to pertinent provisions of the Plan on which the denial is based;

 

(iii)                               a
description of any additional material or information necessary to perfect the
claim and an explanation of why such material or information is necessary;

 

5

 

(iv)                              a
description of the Plan’s claims review procedures, and the time limitations
applicable to such procedures; and

 

(v)                                 a
statement of the Employee’s right to bring a civil action under Section 502(a) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) if
the claim denial is appealed to the Administrator and the Administrator fully
or partially denies the claim.

 

(c)                                  An
Employee whose application for benefits is denied may request a full and fair
review of the decision denying the claim by filing, in accordance with such
procedures as the Administrator may establish, a written appeal which sets
forth the documents, records and other information relating to the claim within
60 days after receipt of the notice of the denial from the Administrator.  In connection with such appeal and upon
request by the Employee, an Employee may review (or receive free copies of) all
documents, records or other information relevant to the Employee’s claim for
benefit, all in accordance with such procedures as the Administrator may
establish.  If an Employee fails to file
an appeal within such period, he shall have no further right to appeal.

 

(d)                                 A
decision on the appeal by the Administrator shall include a review by the
Administrator that takes into account all comments, documents, records and
other information submitted by the Employee relating to the claim, without
regard to whether such information was submitted or considered in the initial
claim determination.  The Administrator
shall render its decision on the appeal not later than 60 days after the
receipt by the Administrator of the appeal. 
If special circumstances apply, the 60-day period may be extended by an
additional 60 days, provided that written notice of the extension is provided
to the Employee during the initial period and such notice indicates the special
circumstances requiring an extension of time and the date by which the
Administrator expects to render its decision on the claim on appeal.

 

If the Administrator wholly or partly denies the claim
on appeal, the Administrator shall provide written notice to the Employee
within the time limitations of the immediately preceding paragraph.  Such notice shall set forth:

 

(i)                                     the
specific reasons for the denial of the claim;

 

(ii)                                  specific
reference to pertinent provisions of the Plan on which the denial is based;

 

(iii)                               a
statement of the Employee’s right to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records, and other
information relevant to the Employee’s claim for benefits; and

 

(iv)                              a
statement of the Employee’s right to bring a civil action under Section 502(a) of
ERISA.

 

The claims procedures described above shall be
administered in accordance with Section 503 of ERISA and regulations
promulgated thereunder.  Any written
notice required to be given

 

6

 

to the Employee may, at
the option of the Administrator and in accordance with guidance issued under Section 503
of ERISA, be provided electronically.

 

SECTION 10.  PLAN
AMENDMENTS AND TERMINATION

 

(a)                                  The
Company reserves the right to make from time to time any amendment or
amendments to this Plan.  The Company further reserves the right to
terminate the Plan at any time.

 

(b)                                 Any
action by the Company under this Plan may be made by resolution of the Board of
Directors of the Company, or by any person or persons duly authorized by the
Board of Directors of the Company to take such action.

 

(c)                                  Any
Employee who is terminated after an amendment or termination shall have the
right to receive only such benefits, if any, as are provided after such
amendment or termination.

 

SECTION 11.  CAPTIONS

 

The use of captions in this Plan is for the
convenience of reference only and shall not affect the meaning of any provision
of this Plan.

 

SECTION 12.  NUMBER AND
GENDER

 

With respect to words used in this Plan, the singular
form shall include the plural form, the masculine gender shall include the
feminine gender, etc., as the context requires.

 

SECTION 13.  SECTION 409A

 

It is the intention of the parties that payments or
benefits payable under this Plan not be subject to the additional tax imposed
pursuant to Section 409A of the Code. 
To the extent such potential payments or benefits could become subject
to such Section, the parties shall cooperate to amend this Plan with the goal
of giving the Employees the economic benefits described herein in a manner that
does not result in such tax being imposed.

 

*  *  * 
*  *

 

This Plan was duly adopted and approved by the Committee
on the 11th day of December 2008.

 

7

 

Schedule A

 

Form of Notification
Letter

 

Dear [Employee],

 

We are pleased to present to you the individual
benefits under and subject to the terms and conditions of Helicos BioSciences
Corporation’s Corporate Officer Severance Plan dated as of December 11,
2008 (the “Plan”).  Capitalized terms not
otherwise defined in this Notification Letter shall have the meanings ascribed
to them in the Plan.  In accordance with
the Plan:

 

Your Severance Period is [                ]
weeks.

 

Your Severance Benefits shall be your Base Pay for the
number of weeks of your Severance Period.

 

Your Outplacement Services shall be [                          ].

 

Sincerely,

 

 

[Company Representative]

 

8

 

Schedule B

 

WAIVER AND RELEASE
AGREEMENT

 

THIS WAIVER AND RELEASE AGREEMENT is entered into as
of                       ,
200_ (the “Effective Date”), by                           
(the “Employee”) in consideration of the severance payments provided to the
Employee by Helicos BioSciences Corporation(the “Company”) pursuant to the Helicos
BioSciences Corporation Corporate Officer Severance Plan (the “Severance
Payment”).

 

1.                                       Waiver
and Release.  The Employee, on his or
her own behalf and on behalf of his or her heirs, executors, administrators,
attorneys and assigns, hereby unconditionally and irrevocably releases, waives
and forever discharges the Company and each of its affiliates, parents,
successors, predecessors, and the subsidiaries, directors, owners, members,
shareholders, officers, agents, and employees of the Company and its
affiliates, parents, successors, predecessors, and subsidiaries (collectively,
all of the foregoing are referred to as the “Employer”), from any and all
causes of action, claims and damages, including attorneys’ fees, whether known
or unknown, foreseen or unforeseen, presently asserted or otherwise arising
through the date of his or her signing of the Waiver and Release Agreement,
concerning his or her employment or separation from employment.  This release includes, but is not limited to,
any claim or entitlement to salary, bonuses, any other payments, benefits or
damages arising under any federal law (including, but not limited to, Title VII
of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the
Employee Retirement Income Security Act of 1974, the Americans with
Disabilities Act, Executive Order 11246, the Family and Medical Leave Act, and
the Worker Adjustment and Retraining Notification Act, each as amended); any
claim arising under any state or local laws, ordinances or regulations
(including, but not limited to, any state or local laws, ordinances or
regulations requiring that advance notice be given of certain workforce
reductions); and any claim arising under any common law principle or public
policy, including, but not limited to, all suits in tort or contract, such as
wrongful termination, defamation, emotional distress, invasion of privacy or
loss of consortium.

 

The Employee understands that by signing this Waiver
and Release Agreement he or she is not waiving any claims or administrative
charges which cannot be waived by law. 
He or she is waiving, however, any right to monetary recovery or
individual relief should any federal, state or local agency (including the
Equal Employment Opportunity Commission) pursue any claim on his or her behalf
arising out of or related to his or her employment with and/or separation from
employment with the Company.

 

The Employee further agrees without any reservation
whatsoever, never to sue the Employer or become a party to a lawsuit on the
basis of any and all claims of any type lawfully and validly released in this
Waiver and Release Agreement.

 

2.                                       Acknowledgments.  The Employee is signing this Waiver and
Release Agreement knowingly and voluntarily. 
He or she acknowledges that:

 

9

 

(a)                                  He
or she is hereby advised in writing to consult an attorney before signing this
Waiver and Release Agreement;

 

(b)                                 He
or she has relied solely on his or her own judgment and/or that of his or her
attorney regarding the consideration for and the terms of this Waiver and
Release Agreement and is signing this Waiver and Release Agreement knowingly
and voluntarily of his or her own free will;

 

(c)                                  He
or she is not entitled to the Severance Payment unless he or she agrees to and
honors the terms of this Waiver and Release Agreement;

 

(d)                                 He
or she has been given at least [twenty-one (21)] [forty-five (45)] calendar
days to consider this Waiver and Release Agreement, or he or she expressly waives
his or her right to have at least [twenty-one (21)] [forty-five (45)] days to
consider this Waiver and Release Agreement;

 

(e)                                  He
or she may revoke this Waiver and Release Agreement within seven (7) calendar
days after signing it by submitting a written notice of revocation to the
Employer.  He or she further understands
that this Waiver and Release Agreement is not effective or enforceable until
after the seven (7) day period of revocation has expired without
revocation, and that if he or she revokes this Waiver and Release Agreement
within the seven (7) day revocation period, he or she will not receive the
Severance Payment;

 

(f)                                    He
or she has read and understands the Waiver and Release Agreement and further
understands that it includes a general release of any and all known and
unknown, foreseen or unforeseen claims presently asserted or otherwise arising
through the date of his or her signing of this Waiver and Release Agreement
that he or she may have against the Employer; and

 

(g)                                 No
statements made or conduct by the Employer has in any way coerced or unduly
influenced him or her to execute this Waiver and Release Agreement.

 

3.                                       No
Admission of Liability.  This Waiver
and Release Agreement does not constitute an admission of liability or
wrongdoing on the part of the Employer, the Employer does not admit there has
been any wrongdoing whatsoever against the Employee, and the Employer expressly
denies that any wrongdoing has occurred.

 

4.                                       Entire
Agreement.  There are no other
agreements of any nature between the Employer and the Employee with respect to
the matters discussed in this Waiver and Release Agreement, except as expressly
stated herein, and in signing this Waiver and Release Agreement, the Employee
is not relying on any agreements or representations, except those expressly
contained in this Waiver and Release Agreement.

 

10

 

5.                                       Execution.  It is not necessary that the Employer sign
this Waiver and Release Agreement following the Employee’s full and complete
execution of it for it to become fully effective and enforceable.

 

6.                                       Severability.  If any provision of this Waiver and Release
Agreement is found, held or deemed by a court of competent jurisdiction to be
void, unlawful or unenforceable under any applicable statute or controlling
law, the remainder of this Waiver and Release Agreement shall continue in full
force and effect.

 

7.                                       Governing
Law.  This Waiver and Release
Agreement shall be governed by the laws of the Commonwealth of Massachusetts, excluding
the choice of law rules thereof.

 

8.                                       Headings.  Section and subsection headings
contained in this Waiver and Release Agreement are inserted for the convenience
of reference only.  Section and
subsection headings shall not be deemed to be a part of this Waiver and Release
Agreement for any purpose, and they shall not in any way define or affect the
meaning, construction or scope of any of the provisions hereof.

 

IN WITNESS WHEREOF, the undersigned has duly executed
this Agreement as of the day and year first herein above written.

 

	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

11Exhibit 4.2

	
   

  

 

 

HSBC FINANCE CORPORATION

 

 

AND

 

 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

AS TRUSTEE.

 

 

 

 

INDENTURE

 

 

Dated as of December 17, 2008

 

 

 

 

Providing for issuance of Senior Subordinated
Notes in Series

	
   

  

 

HSBC
FINANCE CORPORATION

 

Indenture
dated as of December 17, 2008

 

 

TABLE OF CONTENTS*

 

 

	
   

  	
   

  	
   

  	
   

  	
  PAGE

  	
   

  
	
  PARTIES

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RECITALS:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  General
  Form of Face of Note

  	
   

  	
  9

  	
   

  
	
   

  	
  General
  Form of Reverse of Note

  	
   

  	
  11

  	
   

  
	
   

  	
  Form of
  Trustee’s Certificate of Authentication for Notes

  	
   

  	
  13

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I 

  DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

   

  	
   

  
	
  SECTION 1.01

  	
   

  	
  Definitions

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Act

  	
   

  	
  14

  	
   

  
	
   

  	
   

  	
  Affiliate;
  Control

  	
   

  	
  14

  	
   

  
	
   

  	
   

  	
  Authorized
  Newspaper

  	
   

  	
  14

  	
   

  
	
   

  	
   

  	
  Board of
  Directors

  	
   

  	
  14

  	
   

  
	
   

  	
   

  	
  Board Resolution

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Business Day

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Commission; SEC

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Company

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Company Request;
  Company Order; Company Consent

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Corporate Trust
  Office

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Depository

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Depository Note

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Dollar

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
  Euros

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Event of Default

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  FSA

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Foreign Currency

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Holder

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Indenture

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Independent

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Interest

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Interest Payment
  Date

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Junior
  Subordinated Deferrable Interest Notes

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Junior
  Subordinated Indebtedness

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
  Maturity

  	
   

  	
  16

  	
   

  

 

2

 

	
   

  	
   

  	
  Notes

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
  Note Register;
  Note Registrar

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
  Officer’s
  Certificate

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
  Opinion of
  Counsel

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
  Original Issue
  Discount Note

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
  Outstanding

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
  Paying Agent

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Person

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Predecessor
  Notes

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Redemption Date

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Redemption Price

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Regular Record
  Date

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Responsible
  Officer

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Senior
  Indebtedness

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
  Senior
  Subordinated Indebtedness

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
  Special Record
  Date

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
  Stated Maturity

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
  Subsidiary

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
  Trustee

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
  Trust Indenture
  Act, TIA

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
  Voting Stock

  	
   

  	
  19

  	
   

  
	
  SECTION 1.02

  	
   

  	
  Compliance
  Certificates and Opinions

  	
   

  	
  19

  	
   

  
	
  SECTION 1.03

  	
   

  	
  Form of
  Documents Delivered to Trustee

  	
   

  	
  20

  	
   

  
	
  SECTION 1.04

  	
   

  	
  Acts of Holders

  	
   

  	
  20

  	
   

  
	
  SECTION 1.05

  	
   

  	
  Notices, etc.,
  to Trustee and Company

  	
   

  	
  21

  	
   

  
	
  SECTION 1.06

  	
   

  	
  Notices to
  Holders; Waiver

  	
   

  	
  21

  	
   

  
	
  SECTION 1.07

  	
   

  	
  Conflict with
  Trust Indenture Act

  	
   

  	
  22

  	
   

  
	
  SECTION 1.08

  	
   

  	
  Effect of
  Headings and Table of Contents

  	
   

  	
  22

  	
   

  
	
  SECTION 1.09

  	
   

  	
  Successors and
  Assigns

  	
   

  	
  22

  	
   

  
	
  SECTION 1.10

  	
   

  	
  Separability
  Clause

  	
   

  	
  22

  	
   

  
	
  SECTION 1.11

  	
   

  	
  Benefits of
  Indenture

  	
   

  	
  22

  	
   

  
	
  SECTION 1.12

  	
   

  	
  Governing Law

  	
   

  	
  22

  	
   

  
	
  SECTION 1.13

  	
   

  	
  Payment on
  Business Day

  	
   

  	
  22

  	
   

  
	
  SECTION 1.14

  	
   

  	
  Incorporation by
  Reference of Trust Indenture Act

  	
   

  	
  23

  	
   

  
	
  SECTION 1.15

  	
   

  	
  Waiver of Jury
  Trial

  	
   

  	
  23

  	
   

  
	
  SECTION 1.16

  	
   

  	
  Force Majeure
  Events

  	
   

  	
  23

  	
   

  
	
   

  ARTICLE II

  ISSUE, EXECUTION AND REGISTRATION OF NOTES

   

  
	
  SECTION 2.01

  	
   

  	
  Issuance of
  Notes in Series

  	
   

  	
  24

  	
   

  
	
  SECTION 2.02

  	
   

  	
  Authentication
  and Delivery of Notes

  	
   

  	
  24

  	
   

  
	
  SECTION 2.03

  	
   

  	
  Execution of
  Notes

  	
   

  	
  25

  	
   

  
	
  SECTION 2.04

  	
   

  	
  Temporary Notes

  	
   

  	
  25

  	
   

  
	
  SECTION 2.05

  	
   

  	
  Exchanges and
  Transfers of Notes

  	
   

  	
  26

  	
   

  

 

3

 

	
  SECTION 2.06

  	
   

  	
  Mutilated,
  Destroyed, Lost or Stolen Notes

  	
   

  	
  27

  	
   

  
	
  SECTION 2.07

  	
   

  	
  Payment of
  Interest; Interest Rights Preserved

  	
   

  	
  27

  	
   

  
	
  SECTION 2.08

  	
   

  	
  Persons Deemed
  Owners

  	
   

  	
  28

  	
   

  
	
  SECTION 2.09

  	
   

  	
  Cancellation of
  Notes

  	
   

  	
  28

  	
   

  
	
  SECTION 2.10

  	
   

  	
  Appointment of
  Authenticating Agent

  	
   

  	
  29

  	
   

  
	
  SECTION 2.11

  	
   

  	
  Securities
  Issuable in the Form of a Depository Note

  	
   

  	
  30

  	
   

  
	
  SECTION 2.12

  	
   

  	
  CUSIP Numbers

  	
   

  	
  30

  	
   

  
	
   

  ARTICLE III

  COVENANTS

   

  
	
  SECTION 3.01

  	
   

  	
  Payment of
  Principal, Premium and Interest

  	
   

  	
  31

  	
   

  
	
  SECTION 3.02

  	
   

  	
  Maintenance of
  Office or Agency

  	
   

  	
  31

  	
   

  
	
  SECTION 3.03

  	
   

  	
  Money for Note
  Payments to be Held in Trust

  	
   

  	
  31

  	
   

  
	
  SECTION 3.04

  	
   

  	
  Payment of Taxes
  and Other Claims

  	
   

  	
  32

  	
   

  
	
  SECTION 3.05

  	
   

  	
  Statement as to
  Compliance

  	
   

  	
  32

  	
   

  
	
  SECTION 3.06

  	
   

  	
  Corporate
  Existence

  	
   

  	
  32

  	
   

  
	
  SECTION 3.07

  	
   

  	
  Filing of
  Reports

  	
   

  	
  32

  	
   

  
	
  SECTION 3.08

  	
   

  	
  Calculation of
  OID

  	
   

  	
  33

  	
   

  
	
   

  ARTICLE IV

  REDEMPTION OF NOTES

   

  
	
  SECTION 4.01

  	
   

  	
  Applicability of
  Redemption Provisions

  	
   

  	
  33

  	
   

  
	
  SECTION 4.02

  	
   

  	
  Election to
  Redeem; Notice to Trustee

  	
   

  	
  33

  	
   

  
	
  SECTION 4.03

  	
   

  	
  Selection by
  Trustee of Notes to be Redeemed

  	
   

  	
  33

  	
   

  
	
  SECTION 4.04

  	
   

  	
  Notice of
  Redemption.

  	
   

  	
  33

  	
   

  
	
  SECTION 4.05

  	
   

  	
  Deposit of
  Redemption Price

  	
   

  	
  34

  	
   

  
	
  SECTION 4.06

  	
   

  	
  Notes Payable on
  Redemption Date

  	
   

  	
  34

  	
   

  
	
  SECTION 4.07

  	
   

  	
  Notes Redeemed
  in Part

  	
   

  	
  34

  	
   

  
	
   

  ARTICLE V

  SATISFACTION AND DISCHARGE

   

  
	
  SECTION 5.01

  	
   

  	
  Satisfaction and
  Discharge of Indenture

  	
   

  	
  35

  	
   

  
	
  SECTION 5.02

  	
   

  	
  Application of
  Trust Money

  	
   

  	
  36

  	
   

  
	
  SECTION 5.03

  	
   

  	
  Satisfaction,
  Discharge, and Defeasance of Notes of any Series

  	
   

  	
  36

  	
   

  
	
   

  ARTICLE VI

  REMEDIES

   

  
	
  SECTION 6.01

  	
   

  	
  Events of
  Default

  	
   

  	
  37

  	
   

  
	
  SECTION 6.02

  	
   

  	
  Acceleration of
  Maturity; Rescission and Annulment

  	
   

  	
  37

  	
   

  
	
  SECTION 6.03

  	
   

  	
  Collection of
  Indebtedness and Suits for Enforcement by Trustee

  	
   

  	
  38

  	
   

  
									

 

4

 

	
  SECTION 6.04

  	
   

  	
  Trustee
  May File Proofs of Claim

  	
   

  	
  38

  	
   

  
	
  SECTION 6.05

  	
   

  	
  Trustee
  May Enforce Claims Without Possession of Notes

  	
   

  	
  39

  	
   

  
	
  SECTION 6.06

  	
   

  	
  Application of
  Money Collected

  	
   

  	
  39

  	
   

  
	
  SECTION 6.07

  	
   

  	
  Limitation on
  Suits

  	
   

  	
  39

  	
   

  
	
  SECTION 6.08

  	
   

  	
  Unconditional
  Right of Holders to Receive Principal, Premium and Interest

  	
   

  	
  40

  	
   

  
	
  SECTION 6.09

  	
   

  	
  Restoration of
  Rights and Remedies

  	
   

  	
  40

  	
   

  
	
  SECTION 6.10

  	
   

  	
  Rights and
  Remedies Cumulative

  	
   

  	
  40

  	
   

  
	
  SECTION 6.11

  	
   

  	
  Defaults

  	
   

  	
  40

  	
   

  
	
  SECTION 6.12

  	
   

  	
  Delay or
  Omission Note Waiver

  	
   

  	
  40

  	
   

  
	
  SECTION 6.13

  	
   

  	
  Control by
  Holders

  	
   

  	
  40

  	
   

  
	
  SECTION 6.14

  	
   

  	
  Waiver of Past
  Defaults

  	
   

  	
  41

  	
   

  
	
  SECTION 6.15

  	
   

  	
  Undertaking for
  Costs

  	
   

  	
  41

  	
   

  
	
  SECTION 6.16

  	
   

  	
  Waiver of Stay
  or Extension Laws

  	
   

  	
  41

  	
   

  
	
  SECTION 6.17

  	
   

  	
  Waiver of
  Set-off

  	
   

  	
  41

  	
   

  
	
   

  ARTICLE VII

  THE TRUSTEE

   

  
	
  SECTION 7.01

  	
   

  	
  Certain Duties
  and Responsibilities

  	
   

  	
  42

  	
   

  
	
  SECTION 7.02

  	
   

  	
  Notice of
  Defaults

  	
   

  	
  43

  	
   

  
	
  SECTION 7.03

  	
   

  	
  Certain Rights
  of Trustee

  	
   

  	
  43

  	
   

  
	
  SECTION 7.04

  	
   

  	
  Not Responsible
  for Recitals or Issuance of Notes

  	
   

  	
  44

  	
   

  
	
  SECTION 7.05

  	
   

  	
  May Hold
  Notes

  	
   

  	
  44

  	
   

  
	
  SECTION 7.06

  	
   

  	
  Money Held in
  Trust

  	
   

  	
  44

  	
   

  
	
  SECTION 7.07

  	
   

  	
  Compensation and
  Reimbursement

  	
   

  	
  44

  	
   

  
	
  SECTION 7.08

  	
   

  	
  Corporate
  Trustee Required; Eligibility; Disqualification; Conflicting Interests

  	
   

  	
  45

  	
   

  
	
  SECTION 7.09

  	
   

  	
  Preferential
  Collection of Claims Against Company

  	
   

  	
  45

  	
   

  
	
  SECTION 7.10

  	
   

  	
  Resignation and
  Removal; Appointment of Successor

  	
   

  	
  45

  	
   

  
	
  SECTION 7.11

  	
   

  	
  Acceptance of
  Appointment of Successor

  	
   

  	
  46

  	
   

  
	
  SECTION 7.12

  	
   

  	
  Merger,
  Conversion, Consolidation or Succession to Business

  	
   

  	
  46

  	
   

  
	
   

  ARTICLE VIII
  HOLDERS’ LISTS AND REPORTS BY TRUSTEE
  AND COMPANY

   

  
	
  SECTION 8.01

  	
   

  	
  Company to
  Furnish Trustee Names and Addresses of Holders

  	
   

  	
  46

  	
   

  
	
  SECTION 8.02

  	
   

  	
  Preservation of
  Information; Communication to Holder

  	
   

  	
  47

  	
   

  
	
  SECTION 8.03

  	
   

  	
  Reports by
  Trustee

  	
   

  	
  47

  	
   

  
	
   

  ARTICLE IX

  CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

  

 

5

 

	
  SECTION 9.01

  	
   

  	
  Company
  May Consolidate, etc. only on Certain Terms

  	
   

  	
  47

  	
   

  
	
  SECTION 9.02

  	
   

  	
  Successor
  Corporation Substituted

  	
   

  	
  48

  	
   

  
	
   

  ARTICLE X

  SUPPLEMENTAL INDENTURES

   

  
	
  SECTION 10.01

  	
   

  	
  Supplemental
  Indentures Without Consent of Holders

  	
   

  	
  48

  	
   

  
	
  SECTION 10.02

  	
   

  	
  Supplemental
  Indentures With Consent of Holders

  	
   

  	
  49

  	
   

  
	
  SECTION 10.03

  	
   

  	
  Execution of
  Supplemental Indentures

  	
   

  	
  49

  	
   

  
	
  SECTION 10.04

  	
   

  	
  Effect of
  Supplemental Indentures

  	
   

  	
  50

  	
   

  
	
  SECTION 10.05

  	
   

  	
  Conformity with
  Trust Indenture Act

  	
   

  	
  50

  	
   

  
	
  SECTION 10.06

  	
   

  	
  Reference in
  Notes to Supplemental Indentures

  	
   

  	
  50

  	
   

  
	
   

  ARTICLE XI

  SUBORDINATION

   

  
	
  SECTION 11.01

  	
   

  	
  Subordination of
  Notes

  	
   

  	
  50

  	
   

  
	
  SECTION 11.02

  	
   

  	
  Holder
  Authorizes Trustee to Effectuate Subordination

  	
   

  	
  51

  	
   

  
	
  SECTION 11.03

  	
   

  	
  Rights of Senior
  Indebtedness Holders Not Prejudiced

  	
   

  	
  51

  	
   

  
	
  SECTION 11.04

  	
   

  	
  Payments by
  Trustee to Senior Indebtedness Holders

  	
   

  	
  51

  	
   

  
	
  SECTION 11.05

  	
   

  	
  Reliance by Trustee
  on Order or Decree

  	
   

  	
  52

  	
   

  
	
  SECTION 11.06

  	
   

  	
  No Fiduciary
  Duty of Trustee to Senior Indebtedness Holders

  	
   

  	
  52

  	
   

  
	
  SECTION 11.07

  	
   

  	
  Trustee as
  Senior Indebtedness Holder

  	
   

  	
  53

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  *This Table of Contents does not constitute a part
  of the Indenture and is for convenience of reference only

  	
   

  

 

6

 

Tie of certain  provisions 
of  Trust  Indenture 
Act  of  1939 with Indenture, dated as of December 17,
2008, between HSBC Finance Corporation and The Bank of New York Mellon Trust
Company, N.A., as Trustee*

 

	
   

  	
   

  	
  SECTION OF

  
	
  SECTION OF ACT

  	
   

  	
  INDENTURE

  
	
  310

  	
  (a)(1)

  	
   

  	
  7.08

  
	
   

  	
  (a)(2)

  	
   

  	
  7.08

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Not

  
	
   

  	
  (a)(3)

  	
   

  	
  Applicable

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Not

  
	
   

  	
  (a)(4)

  	
   

  	
  Applicable

  
	
   

  	
  (b)

  	
   

  	
  7.08, 7.10

  
	
  311

  	
  (a)

  	
   

  	
  7.09

  
	
   

  	
  (b)

  	
   

  	
  7.09

  
	
  312

  	
  (a)

  	
   

  	
  8.01

  
	
   

  	
   

  	
   

  	
  8.02(a)

  
	
   

  	
  (b)

  	
   

  	
  8.02(b)

  
	
   

  	
  (c)

  	
   

  	
  8.02(b)

  
	
  313

  	
  (a)

  	
   

  	
  8.03(a)

  
	
   

  	
  (b)

  	
   

  	
  8.03(a)

  
	
   

  	
  (c)

  	
   

  	
  8.03(a)

  
	
   

  	
   

  	
   

  	
  8.03(b)

  
	
   

  	
  (d)

  	
   

  	
  8.03(c)

  
	
  314

  	
  (a)

  	
   

  	
  3.07

  
	
   

  	
   

  	
   

  	
  Not

  
	
   

  	
  (b)

  	
   

  	
  Applicable

  
	
   

  	
  (c)(1)

  	
   

  	
  1.02

  
	
   

  	
  (c)(2)

  	
   

  	
  1.02

  
	
   

  	
   

  	
   

  	
  Not

  
	
   

  	
  (c)(3)

  	
   

  	
  Applicable

  
	
   

  	
   

  	
   

  	
  Not

  
	
   

  	
  (d)

  	
   

  	
  Applicable

  
	
   

  	
  (e)

  	
   

  	
  1.02

  
	
  315

  	
  (a)

  	
   

  	
  7.01(a)

  
	
   

  	
   

  	
   

  	
  7.01(c)

  
	
   

  	
  (b)

  	
   

  	
  7.02

  
	
   

  	
   

  	
   

  	
  8.03(a)

  
	
   

  	
  (c)

  	
   

  	
  7.01(b)

  

 

*This tie of provisions does not constitute a part of the Indenture and
is for convenience of reference only.

 

7

 

	
   

  	
   

  	
   

  	
  SECTION OF

  
	
  SECTION OF
  ACT

  	
   

  	
  INDENTURE

  
	
  315

  	
  (d)

  	
   

  	
  7.01(c)

  
	
   

  	
  (d)(1)

  	
   

  	
  7.01(c)(1)

  
	
   

  	
  (d)(2)

  	
   

  	
  7.01(c)(2)

  
	
   

  	
  (d)(3)

  	
   

  	
  7.01(c)(3)

  
	
   

  	
  (e)

  	
   

  	
  6.15

  
	
  316

  	
  (a)

  	
   

  	
  1.01

  
	
   

  	
  (a)(1)(A)

  	
   

  	
  6.02

  
	
   

  	
   

  	
   

  	
  6.13

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  6.14

  
	
   

  	
   

  	
   

  	
  Not

  
	
   

  	
  (a)(2)

  	
   

  	
  Applicable

  
	
   

  	
  (b)

  	
   

  	
  6.08

  
	
  317

  	
  (a)(1)

  	
   

  	
  6.03

  
	
   

  	
  (a)(2)

  	
   

  	
  6.04

  
	
   

  	
  (b)

  	
   

  	
  3.03

  
	
  318

  	
  (a)

  	
   

  	
  1.07

  
					

 

8

 

THIS INDENTURE,
dated as of the 17th day of December, 2008, between HSBC Finance
Corporation, a corporation duly organized and validly existing under the laws
of the State of Delaware (hereinafter sometimes called the “Company”), having
its principal office at 26525 North Riverwoods Boulevard, Mettawa, Illinois
60045, and The Bank of New York Mellon Trust Company, N.A., a national banking
association (hereinafter called the “Trustee”).

 

WITNESSETH:

 

WHEREAS,
the Company deems it necessary from time to time to borrow money for its
corporate purposes and to issue its debt securities therefor, and to that end
has duly authorized and directed the execution and delivery of this Indenture
to provide for one or more series of its unsecured senior subordinated
debentures, senior subordinated notes, or other evidences of senior
subordinated indebtedness (hereinafter called “Notes”), issuable as in this
Indenture provided; and

 

WHEREAS,
the general forms of the Notes, the Trustee’s certificate of authentication to
be borne by the Notes, and the general form of the “Option to Elect Repayment”
(if applicable) may be as follows, with any insertions, omissions and
variations as the Board of Directors of the Company may determine in accordance
with the provisions of this Indenture, or in such other form as shall be
established by or pursuant to a Board Resolution or in one or more indentures
supplemental hereto:

 

[GENERAL FORM OF FACE OF NOTE]

 

THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION.

 

[If the Note is an Original Issue Discount Note,
insert–For purposes of Sections 1271-1273  of
the United States Internal Revenue Code of 1986, as amended, the issue price of
this Note is        % of its
principal amount and the issue date is                                   ,200_.]

 

No.

 

HSBC FINANCE CORPORATION

Senior Subordinated Note

 

HSBC FINANCE CORPORATION, a Delaware corporation
(hereinafter called the “Company”, which term includes any successor
corporation under the Indenture hereinafter referred to), for value received,
hereby promises to pay to                                       
or registered assigns, the principal sum of
                              on
                        .[If the Note is to bear interest prior to Maturity, insert-, and
to pay interest thereon at the rate per annum [of                       %]
[set forth on the reverse of this Note]. The Company will pay interest from                             ,
or from the most recent Interest Payment Date to which interest has been paid
or duly provided for, [Insert frequency of
interest periods.]  (beginning                       )
on                         ,
until the principal hereof is paid or duly provided for. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in the Indenture, be 

 

9

 

paid to the Holder of this Note (or one or more
Predecessor Notes) of record at the close of business on the Regular Record
Date for such interest, which shall be [If applicable, insert-except
that interest payable at Maturity shall be paid to the same Person to whom the
principal of this Note is payable.] Interest will be computed on the basis of [Insert method of computing interest]. Any
such interest not so punctually paid or duly provided for shall forthwith cease
to be payable to the Holder on such Regular Record Date, and may be paid to the
Holder of this Note (or one or more Predecessor Notes) of record at the close
of business on a Special Record Date fixed by the Trustee for the payment of
such defaulted interest, notice whereof shall be given to Holders not less than
10 days prior to such Special Record Date, or may be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.]

 

[If the
Security is not to bear interest prior to Maturity,
insert-            The
principal of this Note shall not bear interest except in the case of a default
in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal of this Note   shall bear interest at the rate of             %
per annum (to the extent that the payment of such interest shall be legally
enforceable), which shall accrue from the date of such default in payment to
the date payment of such principal has been made or duly provided for. Interest
on any overdue principal shall be payable on demand. Any such interest on any
overdue principal that is not so paid on demand shall bear interest at the rate
of                %
per annum (to the extent that the payment of such interest shall be legally
enforceable), which shall accrue from the date of such demand for payment to
the date payment of such interest has been made or duly provided for, and such
interest shall also be payable on demand.]

 

Payment of the principal of (and premium, if any) on
this Note and, unless otherwise paid as hereinafter provided, the interest (if
any) thereon will be made at the office or agency of the Company in the                                     ,
in such coin or currency of the [United States of America as at the time of
payment is legal tender for payment of public and private debts,] provided, however, that payment of interest may be made at
the option of the Company by check or draft mailed to the Person entitled
thereto at his address appearing in the Note Register. Additional provisions of
this Note are set forth on the reverse hereof.

 

Unless the certificate of authentication hereon has
been executed by or on behalf of the Trustee by manual signature, this Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.

 

IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed under its facsimile
corporate seal.

 

	
   

  	
  Dated:

  	
   

  	
  HSBC FINANCE
  CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Attest:

  	
  By

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
								

 

 

10

 

[GENERAL FORM OF REVERSE OF NOTE]

 

HSBC FINANCE CORPORATION

Senior Subordinated Note

 

This Note is one of a
duly authorized issue of Senior Subordinated Notes of the Company (herein
called the “Notes”), issuable in series, unlimited in aggregate principal
amount except as may be otherwise provided in respect of the Notes of a
particular series, issued and to be issued under and pursuant to an Indenture
dated as of                   ,
20     (herein called the “Indenture”), duly
executed and delivered by the Company to The Bank of New York Mellon Trust
Company, N.A., as Trustee, and is one of a series designated as Senior
Subordinated Notes due

 

                                    (herein
called the “                          Notes”),
[Insert, as applicable - unlimited in
aggregate principal amount. - or - limited in
aggregate principal amount to $                  .]
Reference is hereby made to the Indenture and all indentures supplemental
thereto for a description of the rights, limitations of rights, obligations,
duties and immunities thereunder of the Trustee, the Company and the Holders.

 

 

[AT THE COMPANY’S OPTION,
ADDITIONAL PROVISIONS APPLICABLE TO INTEREST RATE MAY BE INSERTED HERE]

 

[If
applicable, insert-The  Notes of this
series are subject to redemption upon not less than 30 days’ notice by mail, at
any time on or after [the fifth anniversary
after issuance], as a whole or in part, at the election of the
Company, at the following Redemption Prices (expressed as percentages of the
principal amount): If redeemed [on or before                   
,          %, and if redeemed]
during the 12-month period beginning                             
of the years indicated,

 

 

	
  Year

  	
   

  	
  Redemption Price

  	
  Year

  	
   

  	
  Redemption Price

  

 

 

and thereafter at a
Redemption Price equal to           %
of the principal amount, together in the case of any such redemption with
accrued interest to the Redemption Date, but interest installments whose Stated
Maturity is on or prior to such Redemption Date will be payable to the Holders
of such Notes, or one or more Predecessor Notes, of record at the close of
business on the relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.]

 

[If
applicable, insert-The  Notes of this
series are subject to redemption upon not less than 30 days’ notice by mail, at
any time on or after [the fifth anniversary
after issuance], as a whole or in part, at the election of the 

 

11

 

Company, at the Redemption Prices for redemption (expressed as
percentages of the principal amount) set forth in the table below: If redeemed
during a 12- month period beginning of the years indicated,

 

 

	
  Year

  	
    Redemption
  Price  

  	
   

  

 

 

and thereafter at a Redemption Price equal to             %
of the principal amount, together in the case of any such redemption with
accrued interest to the Redemption Date, but interest installments whose Stated
Maturity is on or prior to such Redemption Date will be payable to the Holders
of such Notes, or one or more Predecessor Notes, of record at the close of
business on the relevant Regular Record Dates referred to on the face hereof,
all as provided in the Indenture].

 

[In the event of redemption of this Note in part only,
a new Note or Notes of this series for the unredeemed portion hereof will be
issued in  the name of the Holder hereof
upon the cancellation hereof.]

 

[If the Note
is not an Original Issue Discount Note, -If  any
Event of Default with respect to Notes of this series shall occur and be
continuing, the principal of the Notes of this series may be declared due and
payable in the manner and with the effect provided in the Indenture.]

 

[If the Note
is an Original Issue Discount Note,-If  an
Event of Default with respect to Notes of this series shall occur and be
continuing, an amount of principal of the Notes of this series may be declared
due and payable in the manner and with the effect provided in the Indenture.
Such amount shall be equal to-Insert formula for
determining the amount. Upon payment (i) of the amount of
principal so declared due and payable and (ii) of interest on any overdue
principal (to the extent that the payment of such interest shall be legally
enforceable), all of the Company’s obligations in respect of the payment of the
principal of and interest, if any, on the Notes of this series shall
terminate.]

 

The Indenture contains
provisions for defeasance at any time of the entire indebtedness of the Company
on this Note upon compliance by the Company with certain conditions set forth
therein, which provisions apply to this Note.

 

Any optional redemption or defeasance requires the
prior consent of the Federal Reserve Bank of New York and indication from the
FSA that it does not object (unless such approval or non-objection is not
required by the Federal Reserve Bank of New York and the FSA, respectively, at
the time established for redemption or defeasance).

 

The Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of the right and
obligations of the Company and the rights of the Holders under the Indenture at
any time by the Company with the consent of the Holders of at least a majority
in aggregate principal amount of the Notes at the time Outstanding of each
series which is affected by such amendment or modification, except that certain
amendments specified in the Indenture may be made without approval of Holders
of the Notes. The Indenture also contains provisions permitting the Holders of
a majority in aggregate principal amount of the Outstanding Notes of any series
to waive 

 

12

 

on behalf of the Holders of such series of Notes
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of the Note shall be binding upon such Holder and upon all
future Holders of this Note and any Note issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent or waiver is made upon this Note.

 

The indebtedness evidenced by the Notes is, to the
extent and in the manner provided in the Indenture, subordinate and subject in
right of payment to the prior payment in full of the principal of (and premium,
if any) and interest on all Senior Indebtedness as defined in the Indenture,
and this Note is issued subject to such provisions and each Holder, by
accepting the same, agrees to and shall be bound by such provisions, and
authorizes the Trustee in his behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in the Indenture and
appoints the Trustee his attorney-in-fact for such purpose.

 

As provided in the Indenture and subject to certain limitations
therein set forth, transfer of this Note is registrable on the Note Register,
upon surrender of this Note for registration of transfer at the office or
agency of the Company in the                         
, duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Note Registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and thereupon one or more
new Notes of the same series containing identical terms and provisions, of
authorized denominations and for a like aggregate principal amount, will be
issued to the designated transferee or transferees.

 

The                                     
Notes are issuable only as registered Notes without coupons in denominations as
provided in the Indenture and subject to certain limitations therein set forth,
Notes are exchangeable for a like aggregate principal amount of Notes of the
same series containing identical terms and provisions and of different
authorized denominations, as requested by the Holder surrendering the same.

 

No service charge will be
made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

 

The Company, the Trustee
and any agent of the Company or the Trustee may treat the person in whose name
this Note is registered as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes whether or not this Note
be overdue, and neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.

 

All terms used in this
Note which are defined in the Indenture have the meanings assigned to them in
the Indenture.

 

 

[FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION FOR NOTES]

 

This is one of the Notes
of the series designated herein referred to in  
the within-mentioned Indenture.

 

13

 

	
   

  	
  The Bank of New York Mellon Trust Company, N.A.,

        as Trustee

  

 

	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Authorized Officer

  	
   

  

 

 

WHEREAS, all things
necessary to make this Indenture a valid and legally binding agreement of the
Company, in accordance with its terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration
of the premises and the purchase of Notes to be issued hereunder by Holders
thereof, it is mutually covenanted and agreed, for the equal and proportionate
benefit of all Holders, as follows:

 

ARTICLE I

DEFINITIONS AND OTHER PROVISIONS OF GENERAL
APPLICATION

 

SECTION 1.01.
For all purposes of this Indenture, except as otherwise expressly provided 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 TIA, either directly or by reference
therein, have the meanings assigned to them therein; and

 

(3) all accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles.

 

“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.

 

“Authorized Newspaper” when
used in connection with the name of a particular city, means a newspaper,
printed in an official language of the country of publication, of general
circulation and customarily published in such city on each Business Day,
whether or not published on Saturdays, Sundays or holidays. Whenever successive
weekly publications in an Authorized Newspaper are required hereunder they may
be made (unless otherwise expressly provided herein) on the same or different
days of the week and in the same or in different Authorized Newspapers.

 

“Board of Directors” means
either the board of directors of the Company, any duly authorized committee of
that board, or any officer of the Company duly authorized by the board of
directors of the Company or a duly authorized committee of that board.

 

14

 

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

 

“Business Day” means
each Monday, Tuesday, Wednesday, Thursday 
or Friday which is not a legal holiday for banking institutions in the
city  of New York, New York, or in the
particular city with reference to  which the
determination as to Business Day is being made.

 

“Commission” or
“SEC” means the Securities and Exchange
Commission, as from time to time constituted, created under the Securities
Exchange Act of 1934, 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.

 

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

 

“Company Request”, “Company Order”
and “Company Consent” mean,
respectively, a written request, order or consent signed in the name of  the Company by its President or a Vice President, and by
its Treasurer, an Assistant Treasurer, Controller, an Assistant Controller,
Secretary or an Assistant Secretary, and delivered to  the
Trustee.

 

“Corporate Trust Office” means
the office of the Trustee at which at any particular time its corporate trust
business shall be administered, which office at date of the execution of this
Indenture is located at 2 North LaSalle Street, Suite 1020, Chicago,
Illinois 60602 or at such other address as the Trustee may designate from time
to time by notice to the Holders and the Company, or the principal corporate
trust office of any successor Trustee (the address of which the successor
Trustee will notify the Holders and the Company).

 

“Depository” shall
mean, with respect to Notes of  any series for
which the Company shall determine that such Notes will be issued as a
Depository Note, The Depository Trust Company, New York, New York, another
clearing agency or any successor registered under the Securities Exchange Act
of 1934, or other applicable statute or regulation, which, in each case, shall
be designated by the Company pursuant to either Section 2.01
or 2.11.

 

“Depository Note” shall
mean, with respect to Notes of any series for which the Company shall determine
that such Notes will be issued as a Depositary Note, a Note executed by the
Company and authenticated and delivered by the Trustee to the Depository or
pursuant to the Depository’s instruction, all in accordance with this Indenture
and pursuant to a Company Order, which (i) shall be registered as to
principal and interest in the name of the Depository or its nominee and (ii) shall
represent, and shall be denominated in an amount equal to the aggregate
principal amount of, all of the Outstanding Notes of such series.

 

“Dollar” means
the coin or currency of the United States of America which at the time of
payment is legal tender for the payment of public and private debts.

 

15

 

“Euros” means
the lawful currency of the member states of the European Union that have
adopted or adopt the single currency in accordance with the Treaty establishing
the European Community, as amended.

 

“Event of Default” has
the meaning specified in Section 6.01.

 

“FSA” means the
Financial Services Authority of the United Kingdom.

 

“Foreign Currency” means
a currency issued by the government of  
any country other than the United States.

 

“Guarantee” means
the Capital Securities Guarantee Agreement, dated as of November 29, 2005
executed and delivered by the Company for the benefit of the holders of the
$1,000,000,000 capital securities of HSBC Finance Capital Trust IX.

 

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

 

“Indenture” means
this Indenture dated as of December 17, 2008, and, unless the context
otherwise indicates, all indentures supplementing and amending this Indenture.

 

“Independent” when
used with respect to any specified Person means such a Person who (1) is
in fact independent, (2) does not have any material direct or indirect
financial interest in the Company or in any other obligor upon the Notes or in
any Affiliate of the Company or of such other obligor, and (3) is not connected
with the Company or such other obligor or any Affiliate of the Company or of
such other obligor, as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions. Whenever it is herein
provided that any Independent Person’s opinion or certificate shall be
furnished to the Trustee, such Person shall be appointed by a Company Order,
and such opinion or certificate shall state that the signer has read this
definition and that the signer is Independent within the meaning hereof.

 

“Interest”,
when used with respect to an Original Issue Discount Note which by its terms
bears interest only after Maturity, means interest payable after Maturity.

 

“Interest Payment Date” means
the Stated Maturity of interest on   Notes
of a particular series.

 

“Junior Subordinated Deferrable
Interest Notes” means the Junior Subordinated Deferrable
Interest Notes due November 30, 2035 issued to HSBC Finance Capital Trust
IX in the principal amount of $1,031,000,000.

 

“Junior Subordinated Indebtedness”
means all notes, debentures or other evidences of
indebtedness of the Company for money borrowed which shall contain or have
applicable thereto subordination provisions substantially in the form of the
subordination provisions set forth in Section 11.01 hereof
when applicable, but with appropriate adjustments therein so as to provide for
such Junior Subordinated Indebtedness being subordinate and junior to all
Senior Indebtedness and Senior Subordinated Indebtedness rather than only to Senior
Indebtedness. For the avoidance of doubt, “Junior Subordinated Indebtedness”
shall also include the Guarantee and the Junior Subordinated Deferrable
Interest Notes.

 

“Maturity” when
used with respect to Notes of a particular series means the date on which the
principal or any installment of principal of such Notes becomes due and 

 

16

 

payable as therein or herein provided, whether at the
Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.

 

“Notes” means
all debt securities issued under this Indenture, regardless of series.

 

“Note Register” and
“Note Registrar” have the respective
meanings specified in Section 2.05.

 

“Officers’ Certificate” means
a certificate signed by the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the
Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee. Wherever this Indenture requires that an Officers’ Certificate be
signed also by an accountant or other expert, such accountant or other expert
(except as otherwise expressly provided in this Indenture) may be in the employ
of the Company.

 

“Opinion of Counsel” means
a written opinion of counsel, who may be counsel for the Company.

 

“Original Issue Discount Note” means
any Note which provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 6.02.

 

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

 

(i)        Notes theretofore cancelled by the
Trustee, or delivered to the Trustee or any agent of the Trustee for
cancellation;

 

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

 

(iii)      Notes which have been paid pursuant to Section 2.06 or in exchange for or in lieu of which
other Notes have been authenticated and delivered pursuant to this Indenture
other than any such Notes in respect of which there shall have been presented
to the Trustee proof satisfactory to it that such Notes are held by a bona fide
purchaser in whose hands such Notes are valid obligations of the Company; and

 

(iv)      any such Notes which have been defeased
pursuant to Section 5.03. provided,
however, that in determining whether the Holders of the requisite
principal amount of Notes Outstanding have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, or for any other
purpose, (i) Notes owned by the Company or any other obligor upon the
Notes or any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent 

 

17

 

or waiver, only Notes
which the Trustee knows to be so owned shall be so disregarded, and Notes so
owned which have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee’s right
so to act with respect to such Notes and that the pledgee is not the Company or
any other obligor upon the Notes or any Affiliate of the Company or such other
obligor, and (ii) the principal amount of an Original Issue Discount Note
that shall be deemed to be Outstanding for such purposes shall be the amount of
the principal thereof that would be due and payable as of the date of such
determination upon a declaration of acceleration pursuant to Section 6.02.

 

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

 

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

 

“Predecessor Notes” of
any particular Note means every previous Note evidencing all or a portion of
the same debt as that evidenced by such particular Note; and, for purposes of
this definition, any Note authenticated and delivered under Section 2.06 in exchange for  or
in lieu of a mutilated, destroyed, lost, or stolen Note shall be deemed to
evidence the same debt as the mutilated, destroyed, lost, or stolen Note.

 

“Redemption Date” when
used with respect to any Note to be redeemed means the date fixed for such
redemption by or pursuant to this Indenture, any indenture supplemental hereto,
or resolution of the Board of Directors as provided in Section 2.01
of this Indenture.

 

“Redemption Price” when
used with respect to any Note to be redeemed means the price at which it is to
be redeemed pursuant to this Indenture, any indenture supplemental hereto, or
resolution of the Board of Directors as provided in Section 2.01
of this Indenture.

 

“Regular Record Date” for
the interest payable on any Interest Payment Date means, with respect to Notes
of any series, the date specified as the Regular Record Date therefor in the
relevant supplemental indenture or resolution of the Board of Directors
authorizing such series of Notes.

 

“Responsible Officer when
used with respect to the Trustee means an officer of the Trustee assigned to
the Corporate Trust Office, including any Vice President or Assistant Vice
President, any Trust Officer or Assistant Trust Officer, or any other Officer
of the Trustee customarily performing functions similar to those performed by
any of the above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the administration of this
Indenture.

 

“Senior Indebtedness” means
(a) any obligation of, or any obligation guaranteed by, the Company for
money borrowed or purchased whether or not evidenced by bonds, debentures,
notes or other written instruments, (b) similar obligations arising from
off-balance sheet guarantees and direct credit substitutes, (c) obligations
associated with derivative products such as interest rate and foreign exchange
rate contracts, commodity contracts and similar arrangements, (d) any
deferred obligations for the payment of the 

 

18

 

purchase price of property or assets, and (e) any
other creditors of the Company,  whether,
in each case, such indebtedness is outstanding on the date of execution of the
Indenture or thereafter created, assumed or incurred, except indebtedness, if
any, which by its terms ranks on a parity with or junior to Senior Subordinated
Indebtedness, including, but not limited to, for the avoidance of doubt, the
Guarantee and the Junior Subordinated Deferrable Interest Notes.

 

“Senior Subordinated Indebtedness” means (a) any Notes to be
issued and outstanding hereunder and (b) any and all notes, debentures or
other evidences of indebtedness of the Company for money borrowed (other than Junior
Subordinated Indebtedness) which shall contain or have applicable thereto
subordination provisions substantially identical in effect to those contained
in Section 11.01 hereof providing for
the subordination of such indebtedness to all Senior Indebtedness (but not to
any other indebtedness of the Company, including, but not limited to, for the
avoidance of doubt, the Guarantee and the Junior Subordinated Deferrable
Interest Notes).

 

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

 

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

 

“Subsidiary” of
the Company means any corporation at least a majority of the shares of the
Voting Stock (or the equivalent thereof, in the case of corporations organized
outside the United States of America) of which shall at the time be owned,
directly or indirectly, by the Company or by one or more Subsidiaries or by the
Company and one or more Subsidiaries.

 

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

 

“Trust Indenture Act” or
“TIA” means the Trust Indenture Act of
1939, as it may be amended from time to time.

 

“Voting Stock”, as
applied to the stock of any corporation, means stock of any class or classes
(however designated) having ordinary voting power for the election of a majority
of the directors of such corporation, other than stock having such power only
by reason of the happening of a contingency.

 

SECTION 1.02.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers’ Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate
or opinion need be furnished.

 

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

 

19

 

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

 

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

 

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

 

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

 

SECTION 1.03.
In any case where several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and one or more
other such Person as to other matters, and any such Person may certify or give
an opinion as to such matters in one or several documents.

 

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

 

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

 

SECTION 1.04.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by an agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee, and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the “Act” of
the Holders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 7.01)  conclusive in favor of the Trustee and the Company, if made
in the manner provided in this Section 1.04.

 

(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 

 

20

 

notary public 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 a member of a partnership, on behalf of such
corporation or partnership, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the execution of any
such instrument or writing, or the authority of the person executing the same,
may also be proved in any other manner which the Trustee deems sufficient, and
the Trustee may in any instance require proof with respect to any of the
matters referred to in this Section 1.04.

 

(c) The ownership of
Notes shall be proved by the Note Register.

 

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

 

(e) In determining
whether the Holders of the requisite principal amount of Outstanding Notes of
any series have given any request, demand, authorization, direction, notice,
consent or waiver under this Indenture, the principal amount of an Original
Issue Discount Note 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 pursuant to the
terms of such Original Issue Discount Note upon a declaration of acceleration
pursuant to Section 6.02 at the time the
taking of such action by the Holders of such requisite principal amount of
Outstanding Notes is evidenced to the Trustee, as provided in Subsection (a) of
this Section.

 

(f) For the purposes
of calculating the principal amount of Notes of any series denominated in Euros
or a currency issued by the government of any country other than the United
States for any purpose under this Indenture, the principal amount of such Notes
at any time outstanding 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 Trustee in an Officers’ Certificate for Euros or such currency
into Dollars as of the date of any such calculation, which shall be a Business
Day.

 

SECTION 1.05.
Any request, demand, authorization, direction, notice, consent waiver or Act of
Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,

 

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

 

(2) the Company by
the Trustee or by any Holder shall be sufficient for every purpose hereunder
(unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to the Company addressed to it at the address of
its principal office specified in the first paragraph of this instrument or at
any other address previously furnished in writing to the Trustee by the
Company.

 

SECTION 1.06.
Where this Indenture provides for notice to Holders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in 

 

21

 

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

 

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

 

In case, by reason of the
suspension of publication of any Authorized Newspaper, or by reason of any
other cause, it shall be impossible to make publication of any notice in an
Authorized Newspaper or Authorized Newspapers as required by this Indenture,
then such method of publication or notification as shall be made with the
approval of the Trustee shall constitute a sufficient publication of such
notice.

 

SECTION 1.07.
If any provision hereof limits, qualifies or conflicts with another provision
hereof which is required to be included in this Indenture by any of the
provisions of the TIA, such required provision shall control.

 

SECTION 1.08.
The Article headings herein and the Table of Contents  are for convenience only and shall not affect
the construction hereof.

 

SECTION 1.09.
All covenants and agreements in this Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.

 

SECTION 1.10.
In case any provision in this Indenture or in the Notes 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.
Nothing in this Indenture or in the Notes, expressed or implied, shall give to
any Person, other than the parties hereto and their successors hereunder and
the Holders, any benefit or any legal or equitable right, remedy or claim under
this Indenture.

 

SECTION 1.12.
This Indenture and each Note issued hereunder shall be construed in accordance
with and governed by the laws of the State of Illinois, provided that the
immunities and standard of care of the Trustee in connection with the
administration of its trusts hereunder shall be construed in accordance with
and governed by the laws of the State of New York.

 

SECTION 1.13.
In any case where any Interest Payment Date, Redemption Date or Stated Maturity
of any Note shall not be a Business Day, then (notwithstanding any other
provision of this Indenture) payment of interest or principal (and premium, if
any), as the case may be, need not be made on such date but may be made on the
next 

 

22

 

succeeding Business Day with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, 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.

 

SECTION 1.14.
Whenever this Indenture refers to a section of the TIA, that section, as in
effect on any particular date, is incorporated by reference in and made a part
of this Indenture. If the numerical designation of a section of the TIA is
changed subsequent to the date of this Indenture as a result of an amendment to
the TIA, then the reference in this Indenture to such section shall be deemed
to refer to the numerical designation of such section as amended.

 

The following TIA terms
used in this Indenture have the following meanings:

 

“indenture securities” means the Notes.

 

“indenture security holder” means a Holder.

 

“indenture to be qualified” means this Indenture.

 

“indenture trustee” 
or  “institutional trustee”  means 
the  Trustee.

 

“obligor” on the indenture securities means the
Company or any other obligor on the Notes.

 

All other TIA terms used
in this Indenture that are defined by the TIA, defined by TIA reference to
another statute or defined by SEC rule have the meanings assigned to them
by the TIA or such statute or rule.

 

SECTION 1.15.  EACH OF THE
COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION
CONTEMPLATED HEREBY.

 

SECTION 1.16.   In no event
shall either party be responsible or liable for any failure or delay in the
performance of its obligations hereunder arising out of or caused by, directly
or indirectly, forces beyond its control, including, without limitation,
strikes, work stoppages, accidents, acts of war or terrorism, civil or military
disturbances, nuclear or natural catastrophes or acts of God, and
interruptions, loss or malfunctions of utilities, communications or computer (software
and hardware) services; it being understood that such party shall use
reasonable efforts which are consistent with accepted practices in the banking
industry to resume performance as soon as practicable under the circumstances.

 

23

 

ARTICLE II

ISSUE, EXECUTION AND REGISTRATIONS OF NOTES

 

SECTION 2.01.
At the option of the Company, the Notes issued hereunder, which are unlimited
in aggregate principal amount except as may be otherwise provided in respect of
the Notes of a particular series, may be issued in one or more series. The
Notes of each series may be generally in the form provided in this Indenture
(with any such insertions, omissions and variations as determined by the Board
of Directors), to bear such series designation, to mature on such date, to bear
interest at such rate and payable on such dates, and to have such other terms
and provisions (including the currency of denomination, which may be Dollars,
Foreign Currency, Euros or other currency or unit specified therein, and
including any addition to, or modification or deletion of, any Event of Default
or any covenant of the Company specified herein with respect to Notes of the
series), all as shall, prior to the authentication thereof, be established,
consistently with the other provisions of this Indenture, by resolution of the
Board of Directors and set forth in an Officers’ Certificate, or in one or more
supplemental indentures approved by the 
Board of Directors. The Notes of any series may be issued as a
Depository Note.

 

All Notes of any
particular series shall be substantially identical except as to denomination
and except as may otherwise be provided in or pursuant to such Board Resolution
and (subject to Section 2.02)  set forth in such Officers’ Certificate or in any such
indenture supplemental hereto.

 

If any of the terms of
the series are established by action taken pursuant to a Board Resolution, a
copy of an appropriate record of such action shall be certified by the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Officers’ Certificate setting forth the
terms of the series.

 

SECTION 2.02.
From time to time the Company may execute and deliver to the Trustee, and the
Trustee shall thereupon authenticate and deliver to or upon a Company Order,
Notes of any series duly established pursuant to Section 2.01,  upon receipt by the Trustee of:

 

(a) the Board
Resolution (i) authorizing the execution and requesting the authentication
and delivery of the Notes applied for in the principal amount therein
specified, designating the series of such Notes and specifying the Officer or
Officers of the Company to whom or upon whose order such Notes shall be
delivered; and (ii) which, as permitted by Section 2.01,  establishes the terms of such series of Notes and which, if
applicable, authorizes the execution of an indenture supplemental hereto
creating such series of Notes or, if an officer of the Company has been duly
authorized with respect to the foregoing, a certificate from such officer to
the Trustee authorizing the above actions and a Board Resolution evidencing
such officer’s authority;

 

(b) an Officers’
Certificate pursuant to Section 2.01 or,
if the Notes of such series are to be issued pursuant to a supplemental
indenture, a supplemental indenture duly executed on behalf of the Company, in
form satisfactory to the Trustee, creating such series of Notes;

 

(c) an Officers’
Certificate pursuant to Section 1.02;  and

 

(d) an Opinion of Counsel
pursuant to Section 1.02 to the effect that:

 

24

 

(i) the form and
terms of such Notes have been established in conformity with the provisions of
this Indenture;

 

(ii) all conditions
precedent to the authentication and delivery of such Notes have been complied
with and that such Notes, when authenticated and delivered by the Trustee and
issued by the Company in the manner and subject to any conditions specified in
such Opinion of Counsel, will constitute valid and legally binding obligations
of the Company, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting the enforcement of creditors’ rights and to general
equity principles;

 

(iii) all laws and
requirements in respect of the execution and delivery by the Company of such
Notes have been complied with;

 

(iv) the Company is
not in default in any of its obligations under this Indenture, and the issuance
of such Notes will not result in any such default; and (if applicable)

 

(v) the supplemental
indenture is a legal, valid, and binding obligation of the Company, complies
with and is authorized by the applicable provisions of the Indenture, and its
execution and delivery has been duly authorized by the Company.

 

If all Notes of a series
are not to be originally issued at one time, it 
shall not be necessary to deliver the documents described in this Section 2.02 at or prior to the time of authentication
of each Note of such series if such documents are delivered at or prior to the
authentication upon original issuance of the first Note of such series to be
issued.

 

SECTION 2.03.
The Notes shall be executed on behalf of the Company by its President or one of
its Vice Presidents under its corporate seal reproduced thereon and attested by
its Secretary or one of its Assistant Secretaries. The signature of any of such
officers on the Notes may be manual or facsimile.

 

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

 

All Notes shall be dated
the date of their authentication.

 

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

 

SECTION 2.04.
Pending the preparation of definitive Notes of any series, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver, or
cause to be delivered, temporary Notes of such series which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any
denomination, substantially of the tenor of the definitive Notes in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Notes may
determine, as evidenced by their signing of such Notes.

 

25

 

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

 

SECTION 2.05.
The Company shall cause to be kept at the Corporate Trust Office of the Trustee
a note register (the “Note Register”) in which, subject to such reasonable
regulations as the Company may prescribe, the Company shall, subject to Section 2.11, provide for the registration of Notes and
for registrations of transfer of Notes. The Trustee is hereby appointed note
registrar (the “Note Registrar”) for the purpose of registering Notes and
registering transfers of Notes as herein provided.

 

Subject to the provisions
of Section 2.11, upon surrender for
registration of transfer of any Note at any office or agency of the Company
maintained for that purpose, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes of the same series containing identical
terms and provisions, of any authorized denominations and for a like aggregate
principal amount.

 

Subject to  the provisions of Section 2.11,
at the option of the Holder, Notes may be exchanged for other Notes of the same
series containing identical terms and provisions, of any authorized
denominations and for a like aggregate principal amount, upon surrender of the
Notes to  be exchanged at any such office or
agency. Whenever any Notes are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Notes which the
Holder making the exchange is entitled to receive.

 

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

 

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

 

No service charge shall
be made for any registration of transfer or exchange of Notes, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 2.04, Section 4.07 or Section 10.06 not  involving any registration of transfer.

 

The Company shall not be
required (i) to issue, register the transfer of or exchange any Note 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 Notes of such series
selected for redemption under Section 4.04 and
ending at the close of business on the day of such 

 

26

 

mailing, or (ii) to register the transfer of or
exchange any Note so selected for redemption in whole or in part.

 

SECTION 2.06.
A mutilated Note may be surrendered to the Company or the Trustee and thereupon
the Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Note of the same series and of like tenor and principal amount,
bearing a number not contemporaneously outstanding.

 

If there be delivered to
the Company and to the Trustee

 

(i) evidence to
their satisfaction of the destruction, loss or theft of any Note of any series,
and

 

(ii) such security
or indemnity as may be required by them to save 
each of them harmless,

 

then, in the absence of notice to the Company or the
Trustee that such Note has been acquired by a bona fide purchaser, the Company
shall execute and upon its request the Trustee shall authenticate and deliver,
in lieu of any such destroyed, lost or stolen Note, a new Note of such series
and of like tenor and principal amount, bearing a number not contemporaneously
outstanding.

 

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

 

Upon the issuance of any
new Note under this Section 2.06,  the Company may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee)
connected therewith.

 

Every new Note issued
pursuant to this Section 2.06 in lieu of any
destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Note shall be at any time enforceable by anyone, and shall be entitled
to all the benefits of this Indenture equally and proportionately with any and
all other Notes of the same series containing identical terms and provisions
duly issued hereunder.

 

The provisions of this Section 2.06 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 Notes.

 

SECTION 2.07.
Interest on any Note which is payable, and is punctually paid or duly provided
for, on any Interest Payment Date shall be paid to the Person in whose name
such Note (or one or more Predecessor Notes) is registered in the Note Register
at the close of business on the Regular Record Date for such interest.

 

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

 

27

 

(1) The Company may
elect to make payment of any Defaulted Interest to the Persons in whose names
the Notes (or their respective Predecessor Notes) are registered at the close
of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Note and the date of the proposed payment, and at the same time
the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as in this Clause (1) provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall be
not more than 15 nor less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee of the
notice of the proposed payment. The Trustee shall promptly notify the Company
of such Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be mailed, first class postage prepaid, to each
Holder at his address as it appears in the Note Register, not less than 10 days
prior to such Special Record Date. The Trustee shall, upon a Company Request
and in the name and at the expense of the Company, cause a similar notice to be
published at least once in an Authorized Newspaper in New York City but such
publication shall not be a condition precedent to the establishment of 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 Notes (or
their respective Predecessor Notes) are registered on such Special Record Date
and shall no longer be payable pursuant to the following Clause (2).

 

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

 

Subject to the foregoing
provisions of this Section 2.07,  each Note delivered under this Indenture upon registration
of transfer of or in exchange for or in lieu of any other Note shall carry the
rights to interest accrued and unpaid, and to accrue, which were carried by
such other Note.

 

SECTION 2.08.
The Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name any Note is registered in the Note Register as the
owner of such Note for the purpose of receiving payment of principal of (and
premium, if any) and (subject to Section 2.07)  interest on such Note and for all other purposes
whatsoever, whether or not such Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

 

SECTION 2.09.
All Notes surrendered for payment, redemption, registration of transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company may
at any time deliver to the Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Company may have acquired in
any manner whatsoever, and all Notes so 

 

28

 

delivered shall be promptly cancelled by the Trustee.
No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section 2.09,  except as expressly permitted by this Indenture. All
cancelled Notes held by the Trustee shall be disposed of by the Trustee in its
customary manner, and the Trustee shall deliver to the Company a certificate of
such disposal upon the Company’s request.

 

SECTION 2.10.
The Trustee shall, if requested in writing so to do by the Company, promptly
appoint an agent or agents of the Trustee who shall have authority to
authenticate Notes of any series in the name and on behalf of the Trustee. Such
appointment by the Trustee shall be evidenced by a certificate executed by a
Responsible Officer of the Trustee delivered to the Company prior to the
effectiveness of such appointment designating such agent or agents and stating
that all appropriate corporate action has been taken by the Trustee in
connection with such appointment.

 

Any such authenticating
agent shall be an agent acceptable to the Company and shall at all times be a
corporation which is organized and doing business under the laws of the United
States or of any State, is authorized under such laws to act as authenticating
agent, has a combined capital and surplus of at least $5,000,000, and is
subject to supervision or examination by Federal or State authority.

 

Any authenticating agent
may at any time resign by giving written 
notice of resignation to the Trustee and to the Company. The Trustee may
at any time, and upon written request of the Company to the Trustee shall,
terminate the agency of any authenticating agent by giving written notice of
termination to such authenticating agent and to the Company.

 

Any such authenticating
agent shall have the rights and immunities of the Trustee set forth in Sections 2.08, 7.03, 7.04 and 7.05 to
the same extent and as fully to all intents and purposes as though such
authenticating agent had been expressly named in place of the Trustee.

 

If an appointment is made
pursuant to this Section 2.10 with respect to
any series of Notes, such Notes shall have endorsed thereon, in addition to the
Trustee’s Certificate of Authentication, an alternate Trustee’s Certificate of
Authentication substantially in the following form:

(ALTERNATE FORM OF
TRUSTEE’S CERTIFICATE OF AUTHENTICATION)

 

This is one of the Notes
of the series designated herein referred to in the within-mentioned Indenture.

 

 

	
   

  	
  The Bank of New
  York Mellon Trust Company, N.A., as

  Trustee

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Authenticating Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Authorized
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Dated:

  	
   

  	
   

  
					

 

29

 

SECTION 2.11.
(a) If the Company shall establish pursuant to Section 2.01
that the Notes of a particular series are to be issued as a
Depository Note, then the Company shall execute and the Trustee shall, in
accordance with Sections 2.02 and 2.03 and the Company
Order delivered to the Trustee thereunder, authenticate and deliver, a
Depository Note which (i) shall represent, and shall be denominated in an
amount equal to the aggregate principal amount of, all of the Outstanding Notes
of such series, (ii) shall be registered in the name of the Depository or
its nominee, (iii) shall be delivered by the Trustee to the Depository or
pursuant to the Depository’s instruction and (iv) shall bear a legend
substantially to the following effect: “Except as otherwise provided in Section 2.11 of the Indenture, this Note may be
transferred, in whole but not in part, only to another nominee of the
Depository or to a successor Depository or to a nominee of such successor
Depository.”

 

(b) Notwithstanding
any other provision of this Section 2.11
or of Section 2.05,  the
Depository Note of a series may be transferred, in whole but not in part and in
the manner provided in Section 2.05,  only to another nominee of the Depository for such series,
or to a successor Depository for such series selected or approved by the
Company or to a nominee of such successor Depository.

 

(c) If at any time
the Depository for a series of Notes notifies the Company that it is unwilling
or unable to continue as Depository for such series or if at any time the
Depository for such series shall no longer be registered or in good standing
under the Securities Exchange Act of 1934, as amended, or other applicable
statute or regulation and a successor Depository for such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such condition, as the case may be, this Section 2.11 shall no longer be applicable to the Notes
of such series and the Company will execute, and the Trustee will authenticate
and deliver, Notes of such series in definitive registered form without
coupons, in authorized denominations, and in an aggregate principal amount
equal to the principal amount of the Depository Note of such series then
Outstanding in exchange for such Depository Note. In addition, the Company may
at any time determine that the Notes of any series shall no longer be
represented by a Depository Note and that the provisions of this Section 2.11 shall no longer apply to the Notes of such
series. In such event the Company will execute and the Trustee, upon receipt of
an Officers’ Certificate evidencing such determination by the Company, will
authenticate and deliver Notes of such series in definitive registered form
without coupons, in authorized denominations, and in an aggregate principal
amount equal to the principal amount of the Depository Note of such series in
exchange for such Depository Note. Upon the exchange of the Depository Note for
such Notes in definitive registered form without coupons, in authorized
denominations, the Depository Note shall be cancelled by the Trustee. Such
Notes in definitive registered form issued in exchange for the Depository Note
pursuant to this Section 2.11(c) shall
be registered in such names and in such authorized denominations as the
Depository, pursuant to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee.

 

SECTION 2.12. The Company in issuing the Notes may
use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall
use “CUSIP” numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to
the correctness of such numbers either as printed on the Notes or as contained
in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, 
and any such redemption shall not be affected by any defect in or
omission of such numbers.  The Company
will promptly notify the Trustee in writing of any change in the “CUSIP”
numbers.

 

30

 

ARTICLE III

COVENANTS

 

SECTION 3.01. The Company will duly and punctually pay
the principal of (and premium, if any) and interest on the Notes in accordance
with the terms of the Notes and this Indenture.

 

SECTION 3.02.
The Company will maintain an office or agency at each place at which the
principal of (and premium, if any) or interest on any of the Notes is payable,
where Notes may be presented or surrendered for payment, where Notes may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may
be served. The Company will give prompt written notice to the Trustee of the
location, and of any change in the location, of each such office or agency. If
at any time the Company shall fail to maintain any such office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee its agent to
receive all such presentations, surrenders, notices and demands.

 

SECTION 3.03.
If the Company shall at any time act as its own Paying Agent, it will, on or
before each due date of the principal of (and premium, if any) or interest on,
any of the Notes, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and will promptly notify the Trustee
of its action or failure so to act.

 

If the Company shall have
one or more Paying Agents, it will, on or before each due date of the principal
of (and premium, if any) or interest on, any of the Notes, deposit with a
Paying Agent a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due, such sum to be held in trust for  the
benefit of the Persons entitled to such principal, premium or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its action or failure so to act.

 

The Company will cause
each Paying Agent other than the Trustee to execute and deliver to the Trustee
an instrument in which such Paying Agent shall agree with the Trustee, subject
to the provisions of this Section 3.03,  that such Paying Agent will

 

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

 

(2) give the Trustee
notice of any default by the Company (or  any other
obligor upon the Notes) in the making of any such payment of principal (and
premium, if any) or interest; and

 

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

 

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

 

31

 

Paying Agent, such sums to be held by the Trustee upon
the same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.

 

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

 

SECTION 3.04. The
Company will pay or discharge or cause to be paid or discharged, before the
same shall become delinquent, (l) all taxes, assessments and governmental
charges levied or imposed upon it or upon its income, profits or property, and (2) all
lawful claims for labor, materials and supplies which, if unpaid, might by law
become a lien upon its property; provided, however,  that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.

 

SECTION 3.05.
The Company will deliver to the Trustee, within 120 days after the end of each
fiscal year, an Officers’ Certificate stating, as to each signer thereof,
whether or not to  the best of his knowledge, the
Company is in default in the performance of any of its obligations under this
Indenture, and, if there is a default in the fulfillment of any such
obligation, specifying each such default known to  him
and the nature and status thereof.

 

SECTION 3.06.
Subject to Article IX, the Company will do or
cause to be done all things necessary to  preserve and
keep in full force and effect its corporate existence, rights (charter and
statutory) and franchises; provided, however,  that the
Company shall not be required to  preserve or
cause to  be preserved any right or franchise if
the Company shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.

 

SECTION 3.07. The
Company shall file with the Trustee within l5 days after it files them with the
SEC 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 SEC may by rules and
regulations prescribe) which the Company is required to file with the SEC
pursuant to Section  13 or 15(d) of
the Securities Exchange Act of 1934. The Company also shall comply with the
other provisions of TIA §314(a). Delivery
of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Company’s compliance

 

32

 

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

 

SECTION 3.08.
If applicable, the Company shall file with the 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 Notes 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 IV

REDEMPTION OF NOTES

 

SECTION 4.01.
Notes of any series which are redeemable before their Stated Maturity at the
option of the Company or otherwise shall be redeemable in accordance with their
terms and in accordance with the following provisions of this Article IV.

 

SECTION 4.02.
The election of the Company to redeem Notes of any series shall be evidenced by
a Board Resolution or, if an officer of the Company has been duly authorized
with respect to the redemption of Notes, a certificate from such officer to the
Trustee authorizing such actions as are necessary or appropriate to effect the
redemption and a Board Resolution evidencing such officer’s authority. In case
of any redemption at the option of the Company of less than all of the Notes of
any series the Company shall, at least 5 days prior to the date fixed by the
Company for the publication of the notice of redemption (unless a shorter
notice shall be satisfactory to the Trustee), notify the Trustee by Company
Order of such Redemption Date and of the principal amount of Notes to be
redeemed.

 

SECTION 4.03.
If less than all the Notes of any series are to be redeemed, and unless
otherwise provided with respect to the Notes of any particular series, the
particular Notes to be redeemed shall be selected by the Trustee  from the Outstanding Notes of such series not previously
called for redemption, by lot or by such other method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of
portions of the principal of Notes, provided, however,
no such partial redemption shall reduce the portion of the principal amount of
a Note of such series not redeemed to less than the minimum denomination for a
Note of that series. The portions of the principal of Notes so selected for
partial redemption shall be equal to the smallest authorized denomination of
the Notes of such series or an integral multiple thereof.

 

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

 

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

 

SECTION 4.04.
Notice of redemption shall be given not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Notes to be redeemed, at his
address appearing in the Note Register.

 

33

 

All notices of redemption
shall state:

 

(1) the series designation of the Notes to be
redeemed,

 

(2) the Redemption Date,

 

(3) the Redemption Price,

 

(4) if less than all Outstanding Notes of such
series are to be redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the Notes of such Holder to be
redeemed,

 

(5) that on the
Redemption Date the Redemption Price will become due and payable upon each such
Note, and that, if applicable, interest thereon shall cease to accrue from and
after said date, and

 

(6) the place where
such Notes are to be surrendered for payment of the Redemption Price, which
shall be the office or agency of the Company at any place at which the
principal of such Notes is payable.

 

Notice of redemption of
Notes to be redeemed at the option of the Company shall be given by the Company
or, at the Company’s request, by the Trustee in the name and at the expense of
the Company, provided, however, in the latter
case, the Company shall give the Trustee at least 5 Business Days prior notice
of the date of the giving of such notice.

 

SECTION 4.05. On
or prior to any Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 3.03)  an amount of money sufficient to pay the Redemption Price
plus accrued interest of all the Notes which are to be redeemed on that date.

 

SECTION 4.06.
Notice of redemption having been given as aforesaid, the Notes so to be
redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price) such Notes shall
cease to bear interest. Upon surrender of such Notes for redemption in
accordance with such notice, such Notes shall be paid by the Company at the
Redemption Price. Interest, the Stated Maturity of which is on or prior to the
Redemption Date, shall be payable to the Holders of such Notes of record on the
relevant Record Dates according to their terms and the provisions of Section 2.07.

 

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

 

SECTION 4.07 Any
Note which is to be redeemed only in part shall be surrendered to the Trustee
or Paying Agent (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing) and the Company shall execute and the Trustee shall
authenticate and deliver to such Holder, without service charge, a new Note or
Notes of the same series, of any authorized denominations as requested by such
Holder in aggregate principal amount

 

34

 

equal to and in exchange for the unredeemed portion of
the principal of the Note so surrendered.

 

ARTICLE V

SATISFACTION AND DISCHARGE

 

SECTION 5.01.
This Indenture shall cease to be of further effect (except as to any surviving
rights of registration of transfer or exchange of Notes if herein or in any
supplemental indenture expressly provided for), and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when

 

(1) either

 

(A) all Notes
theretofore authenticated and delivered (other than (i) Notes which have
been destroyed, lost or stolen and which have been replaced or paid as provided
in Section 2.06, and (ii) Notes
for whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 3.03)
have been delivered to the Trustee for cancellation, or

 

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

 

(i) have become due and payable, or

 

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

 

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

 

the Company, in the case
of (B) (i), (ii) or (iii) above, has deposited or caused to be deposited
with the Trustee as trust funds in trust for the purpose an amount sufficient
to pay and discharge the entire indebtedness on such Notes not theretofore
delivered to the Trustee for cancellation, for principal (and premium, if any)
and interest to the date of such deposit (in the case of Notes which have
become due and payable), or to their Stated Maturity or Redemption Date, as the
case may be;

 

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

 

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

 

Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 7.07, the obligations of the Trustee to any
authenticating agent under Section 2.10 and,
if money shall have been deposited with the Trustee pursuant to subclause (B) of
clause (1) of this Section, the obligations of the

 

35

 

Trustee under Section 5.02 and
the last paragraph of Section 3.03 shall
survive such satisfaction and discharge.

 

SECTION 5.02.
Subject to the provisions of the last paragraph of Section 3.03,
all money deposited with the Trustee pursuant to Section 5.01 shall be held in trust and applied by it,
in accordance with the provisions of the Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and premium, if any) and interest for whose
payment such money has been deposited with the Trustee; but such money need not
be segregated from other funds except to the extent required by law.

 

SECTION 5.03.
Unless this Section 5.03 shall be deemed
inapplicable to a series of Notes pursuant to the Board Resolution or
supplemental Indenture creating such series, the Company shall be deemed to
have paid and discharged the entire indebtedness on all the Outstanding Notes
of any such series and the Trustee, at the demand of and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of such indebtedness, when

 

(1) either

 

(A) with respect to all Outstanding Notes of such
series,

 

(i) the Company has
deposited or caused to be deposited with the Trustee as trust funds in trust
for the purpose of discharging such indebtedness an amount sufficient to pay
and discharge the entire indebtedness on all Outstanding Notes of such series
for principal (and premium, if any) and interest to the Stated Maturity or any
Redemption Date as contemplated by the penultimate paragraph of this Section 5.03, as the case may be; or

 

(ii) the Company has
deposited or caused to be deposited with the Trustee as obligations in trust
for the purpose of discharging such indebtedness such amount of direct
obligations of, or obligations the principal of and interest on which are fully
guaranteed by, the United States of America and which are not callable at the
option of the issuer thereof as will, together with the income to accrue
thereon without consideration of any reinvestment thereof, be sufficient to pay
and discharge the entire indebtedness on all Outstanding Notes of such series
for principal (and premium, if any) and interest to the Stated Maturity or any
Redemption Date as contemplated by the penultimate paragraph of this Section 5.03, as the case may be; or

 

(B) the
Company has properly fulfilled such other means of satisfaction and discharge
as is specified in the Board Resolution or supplemental indenture applicable to
the Notes of such series; and

 

(2) the Company has paid or caused to be paid all
other sums payable with respect to the Outstanding Notes of such series; and

 

(3) the Company has
delivered to the Trustee a certificate of a firm of independent public
accountants certifying as to the sufficiency of the amounts deposited pursuant
to subsections (A)(i) or (ii) of this Section for payment of the
principal (and premium, if any) and interest on the dates such payments are
due, an Officers’ Certificate and an Opinion of Counsel, each such Certificate
and

 

36

 

Opinion stating that all
conditions precedent herein provided for relating to  the
satisfaction and discharge of the entire indebtedness on all Outstanding Notes
of any such series have been complied with.

 

Any deposits with the
Trustee referred to in Section 5.03(1)(A) above shall be irrevocable and shall be made
under the terms of an escrow trust agreement in form and substance satisfactory
to  the Trustee. If any Outstanding Notes
of such series are to  be redeemed
prior  to  their Stated
Maturity, whether pursuant to  any optional
redemption provisions, the Company shall make such arrangements as are
satisfactory to  the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the expense, of the
Company.

 

Upon the satisfaction of
the conditions set forth in this Section 5.03 with
respect to all the Outstanding Notes of any series, the terms and conditions of
such series, including the terms and conditions with respect thereto set forth
in this Indenture, shall no longer be binding upon, or applicable to, the
Company, other than the provisions of Sections 2.06, 2.07 and
3.02 and other than the right of Holders
of Notes of such series to receive, from the trust fund described in this
Section, payment of the principal of and the interest on such Notes when such
payment are due  and other than the
rights, powers, duties and immunities of the Trustee hereunder (including the
obligations of the Company to the Trustee under Section 7.07).

 

ARTICLE VI

REMEDIES

 

SECTION 6.01.
“Event of Default”, wherever used herein
with respect to Notes of any series, means any one of the following events: if
the Company shall consent to, or a court or other governmental agency shall
enter a decree or order for, the appointment of a receiver, liquidator, trustee
or other similar official in a liquidation, insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceeding with respect to the
Company or substantially all of its property, and, in the case of a decree or
order, such decree or order shall have remained in force for a period of 60
days.

 

There is no right of
acceleration in the case of default in the payment of principal of, or premium
or interest on the Notes or in the performance of any other obligation of the
Company under the Notes.

 

SECTION 6.02. If
an Event of Default occurs with respect to Notes of any series at the time
Outstanding and is continuing, then and in every such case the Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Notes of
that series may declare the principal of all the Notes of that series (or, if
the Notes of that series are Original Issue Discount Notes, such portion of the
principal amount thereof as may be specified in the terms of such Notes) to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such principal
shall become immediately due and payable.

 

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

 

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

 

37

 

(A) all overdue
installments of interest, if any, on all Notes of that series,

 

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

 

(C) to the
extent that payment of such interest is lawful, interest upon overdue
installments of interest, if any, at the rate or the respective rates borne by
the Notes of that series or at a rate otherwise specified therein, and

 

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

 

(2) all Events of  Default have been cured or waived as provided in Section 6.14.

 

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

 

SECTION 6.03. If an Event of
Default occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders by such
appropriate judicial proceedings as the Trustee shall deem necessary to  protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy.

 

SECTION 6.04. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to  the Company or
any other obligor upon the Notes or the property of the Company or of such
other obligor or their creditors, the Trustee (irrespective of whether the
principal of the Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Company for the payment of overdue principal or
interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise,

 

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

 

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

 

and any receiver, assignee, trustee, liquidator,
sequestrator (or other similar official) in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the Trustee, and in
the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agent and counsel, and any other amounts due the Trustee under Section 7.07.

 

38

 

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

 

SECTION 6.05.
All rights of action and claims under this Indenture or the Notes may be
prosecuted and enforced by the Trustee without the possession of  any of  the Notes or
the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as
trustee of  an express trust, and any recovery of
judgment shall, after provision for the payment of  the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, be for the ratable benefit of the Holders of the Notes
in respect of which such judgment has been recovered.

 

SECTION 6.06.
Any money collected by the Trustee pursuant to this Article VI
shall be applied in the following order, at the date or dates fixed
by the Trustee and, in case of the distribution of such money on account of
principal (or premium, if any) or interest, upon presentation of the Notes, and
the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:

 

FIRST: To the payment of
all amounts due the Trustee under Section 7.07;

 

SECOND: To the payment of
the amounts then due and unpaid upon the Notes for principal (and premium, if
any) and interest, 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
Notes for principal (and premium, if any) and interest, respectively; and

 

THIRD: To the payment of
the remainder, if any, to the Company or, as a court of competent jurisdiction
shall direct, or, as directed in writing by the Company to the Trustee, to any
other Person.

 

SECTION 6.07.
No Holder of any Note of any series shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of  a receiver or trustee, or for
any other remedy hereunder, unless:

 

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

 

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

 

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

 

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

 

39

 

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

 

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

 

SECTION 6.08.
Notwithstanding any other provision in this Indenture, and to the extent
required by applicable law, the Holder of any Note shall have the right which
is absolute and unconditional to receive payment of the principal of (and
premium, if any) and (subject to Section 2.07) interest
on such Note on the respective Stated Maturities expressed in such Note (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 6.09.
If the Trustee or any Holder has instituted any proceeding to enforce any right
or remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case the Company, the Trustee and the Holders
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 the Trustee and the Holders shall continue as though no such
proceeding had been instituted.

 

SECTION 6.10.
No right or remedy herein conferred upon or  reserved to
the Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of  any right or remedy hereunder,
or otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.

 

SECTION 6.11. A
“Default” means: (a) the Company fails to pay the principal of (and
premium, if any) any Note on the respective Stated Maturity expressed in such
Note or (b) the Company fails to pay any installment of interest on any
Note when such interest becomes due and payable and such failure it continued
for 30 days. If a Default shall have occurred and be continuing, then the
Trustee, on behalf of the Holders, or any Holder may institute insolvency, liquidation
or any similar proceedings against the Company or against substantially all of
the Company’s property.

 

SECTION 6.12. No
delay or omission of the Trustee or of  any Holder to
exercise any right or  remedy
accruing upon any Event of  Default or
Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or Default or an acquiescence therein. Every right and
remedy given by this Article VI or
by law to the Trustee or to the Holders may be exercised from time to time, and
as often as may be deemed expedient, by the Trustee or by the Holders, as the
case may be.

 

SECTION 6.13.
The Holders of a majority in principal amount of the Outstanding Notes shall
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee, provided that

 

40

 

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

 

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

 

SECTION 6.14.
The Holders of a majority in principal amount of the Outstanding Notes of any
series affected by an Event of Default or Default may on behalf of the Holders
of such series of Notes waive any past default hereunder and its consequences,
except a default in respect of a covenant or provision hereof which under Section 10.02 cannot be
modified or amended without the consent of the Holder of each Outstanding Note
affected.

 

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

 

SECTION 6.15.
All parties to this Indenture agree, and each Holder of any Note by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered, or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may
in its discretion assess reasonable costs, including reasonable attorneys’
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 6.15. shall not apply to any suit instituted by the Trustee,
to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than l0%  in principal
amount of any series of the Outstanding 
Notes, or to any suit instituted by any Holder for the enforcement of
the payment of the principal of (or premium, if any) or interest on any Note on
or after the respective Stated Maturities expressed in such Note for such
interest (or, in the case of redemption, on or after the Redemption Date).

 

SECTION 6.16.
The Company covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the
execution of  every such power as though no such law
had been enacted.

 

SECTION 6.17.  To the fullest extent
permitted by law, the Holders of the Notes, in respect of any claims of such
Holders to payment of any principal, premium or interest in respect of any
Notes and the Trustee, by their acceptance of the Notes hereof will be deemed to
have waived any right of set-off or counterclaim that such Holders or Trustee
may otherwise have hereunder (whether in the Company’s liquidation or at any
other time). The Holders of the Notes and the Trustee, by their acceptance of
the Notes, covenant and agree that if, on the winding up of the Company, they
receive any sums by way of set-off, they will hold such sums on trust for the
Company’s creditors and will, without undue delay, pay such sums to the
liquidator to apply in payment of claims of the Company’s creditors subject to Article XI.

 

41

 

ARTICLE VII

THE TRUSTEE

 

SECTION 7.01.
(a) Except during the continuance of an Event of Default:

 

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

 

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

 

(b)       In case an Event of Default
has occurred and is continuing, the Trustee shall exercise such of the rights
and powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.

 

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

 

(1) this Subsection (c) shall not be construed to limit the
effect of Subsection (a) of this Section 7.01;

 

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

 

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

 

(4) no provision of
this Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers.

 

(d)       Whether or not therein
expressly so provided, every provision of this Indenture relating to the
conduct or affecting the liability of or affording protection to the Trustee
shall be subject to the provisions of this Section 7.01.

 

42

 

SECTION 7.02.
Within 90 days after the occurrence of any default hereunder, the Trustee shall
transmit by mail to all Holders, as their names and addresses appear in the
Note Register, notice of such default hereunder known to the Trustee. Unless
such default shall have been cured or waived, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the Trustee
in good faith determine that the withholding of such notice is in the interests
of the Holders. For the purpose of this Section 7.02 the
term “default” means: any event which is, or
after notice or lapse of time or both would become, an Event of Default.

 

SECTION 7.03.
Except as otherwise provided in Section 7.01:

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

43

 

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

 

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

 

(j)           the rights, privileges,
protections, immunities and benefits given to the Trustee, including, without
limitation, its right to be indemnified, are extended to, and shall be
enforceable by, the Trustee in each of its capacities hereunder.

 

SECTION 7.04.
The recitals contained herein and in the Notes, except the certificate of
authentication, shall be taken as the statements of the Company, and the
Trustee assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Notes. The Trustee shall not be accountable for the use or application by the
Company of Notes or the proceeds thereof.

 

SECTION 7.05.
The Trustee, any Paying Agent, Note Registrar or any other agent of the
Company, in its individual or any other capacity, may become the owner or
pledgee of Notes and, subject to Sections 7.08 and
7.09 may otherwise deal with the Company
with the same rights it would have if it were not Trustee, Paying Agent, Note
Registrar or such other agent.

 

SECTION 7.06.
Money held by the Trustee in trust hereunder need not be segregated from other
funds except to the extent required by law. 
The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the
Company.

 

SECTION 7.07.
The Company agrees

 

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

 

(2) except as
otherwise expressly provided herein, to reimburse the Trustee upon its request
for all expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as shall have been caused by  its own negligence or willful misconduct; and

 

(3) to indemnify the
Trustee for, and to hold it harmless against, any loss, claim, damage, cost,
liability or 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 costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder.

 

44

 

As security for the
performance of the obligations of the Company under this Section 7.07
the Trustee shall have a lien prior to the Notes upon all property
and funds held or collected by the Trustee as such, except funds held in trust
for the payment of principal of (and premium, if any) or interest on particular
Notes. The benefits of this Section shall survive the termination of this
Indenture and resignation or removal of the Trustee.

 

SECTION 7.08.
(a) This Indenture shall always have a Trustee with respect to the Notes
of each series which satisfies the requirements of TIA § 310(a)(1). (b) The
Trustee shall always have a combined capital and surplus of at least $5,000,000
as set forth in its most recent annual report of condition.

 

SECTION 7.09. The
Trustee is subject to TIA § 311(a), excluding any creditor relationship listed
in TIA § 311(b). A Trustee who has resigned or  been
removed shall be subject to TIA § 311(a) to the extent indicated.

 

SECTION 7.10.

 

(a) No resignation
or removal of the Trustee and no appointment of a successor Trustee pursuant to
this Article shall become effective until the acceptance of appointment by
the successor Trustee under Section 7.11.

 

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

 

(c) The Trustee may
be removed at any time by Act of the Holders of a majority in principal amount
of  the Outstanding Notes, delivered to the
Trustee and to the Company, provided, the removed Trustee may petition, at the
expense of the Company, any court of competent jurisdiction for the appointment
of a successor Trustee.

 

(d) If at any time:

 

(1) the Trustee
shall fail to comply with Section 7.08(b) after
written request therefor by the Company or by any Holder who has been a bona
fide Holder for at least six months, or

 

(2) the Trustee
shall cease to be eligible under Section 7.08(a) and
shall fail to resign after written request therefor by the Company or by any
such Holder, or

 

(3) the Trustee
shall become incapable of acting or shall be adjudged a bankrupt or insolvent
or a receiver of the Trustee or of its properly shall be appointed or any
public officer shall take charge or control of the Trustee or of its property
or affairs for the purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove
the Trustee, or (ii) subject to Section 6.15,
any Holder who has been a bona fide Holder for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.

 

(e) If the Trustee
shall resign, be removed or become incapable of acting, or if a vacancy shall
occur in the office of Trustee for any cause, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee. If, within one year
after such

 

45

 

resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of
the Holders of a majority in principal amount of the Outstanding Notes
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Holders and accepted appointment in the manner hereinafter provided, any Holder
who has been a bona fide Holder for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee.

 

(f) The Company
shall give notice of each resignation and each removal of the Trustee and each
appointment of a successor Trustee to the Holders as their names and addresses
appear in the Note Register. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.

 

SECTION 7.11.
Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges hereunder,
execute and deliver an instrument transferring to such successor Trustee all
the rights, powers and truths of the retiring Trustee, and shall duly assign,
transfer and deliver to such successor Trustee all property and money  held by such retiring Trustee hereunder,
subject nevertheless to its lien, if any, provided for in Section 7.07.
Upon request of any such successor Trustee, the Company shall
execute any and an instruments for more fully and certainly vesting in and
confirming to  such successor Trustee all such
rights, powers and trusts.

 

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

 

SECTION 7.12.
Any corporation into which the Trustee may be merged or converted or with which
it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this Article VII, without the execution or filing of any
paper or any further act on the part of any of the parties hereto. In case any
Notes shall have been authenticated, but not delivered, by the Trustee then in
office, any successor by merger, conversion or consolidation to  such authenticating Trustee may adopt such authentication
and deliver the Notes so authenticated with the same effect as if such
successor Trustee had itself authenticated such Notes.

 

ARTICLE VIII

HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY

 

SECTION 8.01.
The Company covenants and agrees that it will furnish or cause to be furnished
to the Trustee, between March 1 and March 15 and between September 1
and September 15 in each 12 months’ period beginning with September 1,
2009, and at such other times as the Trustee may request in writing, within 30
days after receipt by the Company of any such request, a list in such form as
the Trustee may reasonably require of the names and addresses of the Holders as
of a date not more than 15 days prior to  the

 

46

 

time such information is
furnished. So long as  the Trustee is the
Note Registrar no such list need be furnished.

 

SECTION 8.02.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 8.01
and the names and addresses of Holders received by the Trustee in its capacity
as Note Registrar. The Trustee may destroy any list furnished to it as provided
in Section 8.01 upon receipt of a new
list so furnished.

 

(b) Holders of Notes
may communicate pursuant to TIA § 312(b) with other Holders with respect
to their rights under this Indenture or the Notes. The Company, the Trustee,
the Note Registrar, and anyone else shall have the protection of TIA § 312(c).

 

SECTION 8.03.
(a) The term “reporting date”, as used in this
Section 8.03, means November 15.
Within 60 days after the reporting date in each year, the Trustee shall
transmit by mail to all Holders, as their names and addresses appear in the
Note Register, a brief report dated as of such reporting date that complies
with TIA § 313(a). The Trustee shall also comply with TIA § 313(b).

 

(b) Reports pursuant
to this Section 8.03 shall be transmitted
by mail:

 

(1) to all Holders
of Notes, as the names and addresses of such Holders appear in the Note
Register; and

 

(2) to such Holders
of Notes as have, within the 2 years preceding such transmission, filed their
names and addresses with the Trustee for that purpose; and except in the case
of reports pursuant to TIA § 313(b), to  all Holders of
Notes whose names and addresses have been furnished to or received by the
Trustee pursuant to Section 8.01.

 

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

 

ARTICLE IX

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

 

SECTION 9.01.
The Company shall not consolidate with or merge into any other corporation or
convey, transfer, sell or lease its properties and assets as, or substantially
as, an entirety to any Person, unless:

 

(1) the corporation
formed by such consolidation or into which the Company is merged or the Person
which acquires by conveyance, transfer, sale or lease the properties and assets
of the Company as, or substantially as, an entirety shall be a corporation
organized and existing under the laws of the United States of America or any
State or the District of Columbia, and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of
(and premium, if any) and interest on all the Notes and the performance of
every covenant of this Indenture on the part of the Company to be performed or
observed;

 

47

 

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

 

(3) the Company has
delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel
each stating that such consolidation, merger, conveyance or transfer and such
supplemental indenture comply with this Section 9.01 and
that any conditions precedent herein provided for relating to such transaction
have been complied with.

 

SECTION 9.02. Upon
any consolidation or merger, or any conveyance, transfer, sale or lease of the
properties and assets of the Company as, or substantially as, an entirety in
accordance with Section 9.01, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such conveyance, transfer, sale or lease is made shall succeed to, and
be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor corporation had
been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Notes.

 

ARTICLE X

SUPPLEMENTAL INDENTURES

 

SECTION 10.01.
Without the consent of any Holder, the Company and the Trustee, at any time and
from time to time, may enter into one or more indentures supplemental hereto,
in form satisfactory to the Trustee, for any of the following purposes:

 

(1) to create a new
series of Notes;

 

(2) to evidence the
succession of another corporation to the Company, and the assumption by any
such successor of the covenants of the Company herein and in the Notes
contained;

 

(3) to add to the
covenants of the Company for the benefit of the Holders of all or any series of
Notes (and if such covenants are to be for the benefit of less than all series
of Notes, stating that such covenants are expressly being included solely for
the benefit of such series) or to surrender any right or power herein conferred
upon the Company;

 

(4) to add any
additional Events of Default with respect to all or any series of Notes;

 

(5) to cure any
ambiguity, defect, or inconsistency or to  correct or
supplement any provision contained herein or in any supplemental indenture or
in any Notes issued hereunder;

 

(6) to provide for
uncertificated Notes in addition to certificated Notes;

 

(7) to add to or
change any of the provisions of this Indenture to such extent as shall be
necessary to  permit or facilitate the issuance of
Notes in bearer form, registrable or not registrable as to  principal,
and with or without interest coupons;

 

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

 

48

 

change any of the provisions of this Indenture as
shall be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section 7.11; or

 

(9) to make any
change that does not adversely affect the rights of any Holder of Notes which
are Outstanding.

 

SECTION 10.02.
Subject to  the provisions of Section 6.13
and Section 6.14, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Notes of each series which are affected, evidenced by Act of said
Holders delivered to  the Company
and the Trustee, the Company, when authorized by a Board Resolution, and the
Trustee 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 this Indenture or of any supplemental indenture or of
modifying in any manner the rights of the Holders of the Notes of such series
thereof under this Indenture; provided, however,  that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby,

 

(1) change the
Stated Maturity of the principal of, or any installment of interest on, any
Note, or reduce the principal amount thereof or the interest thereon or any
premium payable upon the redemption thereof, or reduce the principal amount of
an Original Issue Discount Note that would be due and payable upon a
declaration of acceleration of the Maturity thereof, or change the coin or
currency in which any Note or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or

 

(2) reduce the
percentage in principal amount of the Outstanding Notes of any 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 Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or

 

(3) modify any of
the provisions of this Section 10.02 or
Section 6.14, except to increase
any such percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the
Holder of each Note affected thereby provided, however,  that this
clause shall not be deemed to require the consent of  any
Holder with respect to changes in the references to “the Trustee” and
concomitant changes in this Section,  or the
deletion of this provision, in accordance with the requirements of Sections 7.11 and 10.01(8).

 

It shall not be necessary
for any Act of Holders under this Section 10.02 to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.

 

SECTION 10.03.
In executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article X or
the modification thereby of the trusts created by this Indenture, the Trustee
shall be provided with, and (subject to Section 7.01)  shall be fully protected in relying upon, an Opinion of
Counsel, stating that the execution of  such
supplemental indenture is authorized or permitted by this Indenture and that
such supplemental indenture is a valid and binding obligation of the Company in
accordance with its terms. The Trustee may, but shall not be obligated to, 

 

49

 

enter into any such supplemental indenture which
affects the Trustee’s own rights, duties or immunities under this Indenture or
otherwise.

 

SECTION 10.04.
Upon the execution of any supplemental indenture under this Article X,  this Indenture
shall be modified in accordance therewith, and such supplemental indenture
shall form a part of this Indenture for all purposes; and every Holder of Notes
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.

 

SECTION 10.05.
Every supplemental indenture executed pursuant to this Article X
shall conform to the requirements of TIA as then in effect.

 

SECTION 10.06.
Notes authenticated and delivered after the execution of any applicable
supplemental indenture pursuant to this Article X may,
and shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Notes so modified as to conform, in the opinion
of the Trustee and the Board of Directors, to any such supplemental indenture
may be prepared and executed by the Company and authenticated and delivered by
the Trustee in exchange for Outstanding Notes.

 

ARTICLE XI

SUBORDINATION

 

SECTION 11.01.
Anything in this Indenture or any Note to the contrary notwithstanding, the
indebtedness evidenced by the Notes shall be subordinate and junior in right of
payment, to the extent and in the manner hereinafter set forth, to all Senior
Indebtedness of the Company whether outstanding at the date of this Indenture
or incurred after the date of this Indenture:

 

In the event of any
insolvency, bankruptcy, receivership, conservatorship, reorganization,
readjustment of debt, marshaling of assets and liabilities or similar
proceedings or any liquidation, dissolution or winding-up of or relating to the
Company as a whole, whether voluntary or involuntary, all obligations of the
Company to holders of Senior Indebtedness shall be entitled to be paid in full
before any payment, whether in cash, property or otherwise, shall be made on
any account of the principal of (or premium, if any) or interest on any of the
Notes. In the event of any such proceeding, after payment in full of all sums
owing with respect to Senior Indebtedness, the Holders, together with the
holders of obligations which expressly rank on a parity with the Notes, shall
be entitled ratably to be paid from the remaining assets of the Company the
amounts at the time due and owing on account of unpaid principal of (and
premium, if any) and interest, if any, on the Notes before any payment or other
distribution, whether in cash, property or otherwise, shall be made on account
of any obligations which expressly rank junior to the Notes or any capital
stock. In addition, in the event of any such proceeding, if any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities (other than securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment the
payment of which is subordinate, at least to the extent provided in these
subordination provisions with respect to the indebtedness evidenced by the
Notes, to the payment of all Senior Indebtedness at the time outstanding, and
to any securities issued in respect thereof under any 

 

50

 

such plan of reorganization
or readjustment), including any such payment or distribution that may be
payable or deliverable by reason of the payment of any other indebtedness of
the Company being subordinated to the payment of the Notes, shall be received
by the Trustee or the Holders before all Senior Indebtedness are paid in full,
such payment or distribution shall be held (in trust if received by such
Holders) for the benefit of and shall be paid over to the holders of such
Senior Indebtedness or their representative or representatives or to the
trustee or trustees under any indenture under which any instruments evidencing
any of such Senior Indebtedness may have been issued, ratably, for application
to the payment of all Senior Indebtedness remaining unpaid until all such Senior
Indebtedness shall have been paid in full, after giving effect to any
concurrent payment or distribution to the holders of such Senior Indebtedness.

 

No present or future
holder of Senior Indebtedness shall be prejudiced in his right to enforce subordination
of the Notes by any act or failure to act on the part of the Company. The
provisions of this Section 11.01 are
solely for the purpose of defining the relative rights of the holders of Senior
Indebtedness on the one hand, and the Holders of the Notes on the other hand,
and nothing herein shall impair, as between the Company and the Holder of any
Note, the obligation of the Company, which is unconditional and absolute, to
pay to the Holder the principal, premium, if any, and interest thereon in accordance
with its terms, nor shall anything herein prevent the Holder of a Note from
exercising all remedies otherwise permitted by applicable law or hereunder upon
default hereunder, subject to the rights, if any, under this Section 11.01 of holders of Senior Indebtedness to
receive cash, property or securities otherwise payable or deliverable to the
holders of the Notes. The Company agrees, for the benefit of the holders of
Senior Indebtedness, that in the event that any Note is declared due and
payable before its expressed maturity because of the occurrence of a default
hereunder (a) the Company will give prompt notice in writing of such
happening to the holders of Senior Indebtedness and (b) all Senior
Indebtedness shall forthwith become immediately due and payable upon demand,
regardless of the expressed maturity thereof. Senior Subordinated Indebtedness
issued hereunder shall rank on a parity with all other senior subordinated
indebtedness (excluding, for the avoidance of doubt, Junior Subordinated Indebtedness)
issued under other indentures between the Company and the Trustee.

 

SECTION 11.02.
By accepting a Note, the Holder authorizes and directs the Trustee to take in
the Holder’s behalf such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article XI
and appoints the Trustee his attorney-in-fact for any and all such
purposes.

 

SECTION 11.03.
No right of any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act in good faith by any such holder, or any
waiver, modification or amendment of the provisions relating to Senior
Indebtedness, or any release of security for Senior Indebtedness regardless of
any knowledge thereof any such holder may have or be otherwise charged with.

 

SECTION 11.04.   The Company shall give prompt written notice
to the Trustee of any fact known to the Company which would prohibit the making
of any payment to or by the Trustee in respect of the Notes.  Failure to give such notice shall not affect
the subordination of the Notes to Senior Indebtedness.  Notwithstanding the provisions of this or any
other provision of this Indenture, the Trustee shall not be charged with 

 

51

 

knowledge of the
existence of any facts which would prohibit the making of any payment to or by
the Trustee in respect of the Notes, unless and until the Trustee shall have
received written notice thereof at the address specified in Section 1.05 from the Company or a holder of Senior
Indebtedness or from any trustee or agent therefor; and, prior to the receipt
of any such written notice, the Trustee, subject to the provisions of Section 7.01, shall be entitled in all respects to
assume that no such facts exist; provided, however,
that if a Responsible Officer of the Trustee shall not have received, at least
three Business Days prior to the date upon which by the terms hereof any such
money may become payable for any purpose (including, without limitation, the
payment of the principal amount, issue price, accrued original issue discount,
Redemption Price or interest, if any, as the case may be, in respect of any
Note), the notice with respect to such money provided for in this Section 11.04, then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such money and to apply the same to the 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 7.01,
the Trustee shall be entitled to conclusively rely on the delivery to it of a
written notice by a person representing himself to be a holder of Senior
Indebtedness (or a trustee or agent on behalf of such holder) to establish that
such notice has been given by a holder of Senior Indebtedness (or a trustee or
agent on behalf of any such holder).  In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this Article XI, the Trustee may request such person  to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness held by
such person, the extent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
person under this Article XI, and if such
evidence is not furnished, the Trustee may defer any payment which it may be
required to make for the benefit of such person pursuant to the terms of this
Indenture pending judicial determination as to the rights of such person to
receive such payment.

 

SECTION 11.05.  Upon
any payment or distribution of assets of the Company referred to in this Article XI, the Trustee, subject to the provisions of Section 7.01, and the Holders of the Notes shall be
entitled to conclusively rely upon any order or decree entered by any court of
competent jurisdiction in which such liquidation, insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceeding is pending,
or a certificate of the trustee in bankruptcy, liquidating trustee, custodian,
receiver, assignee for the benefit of creditors, agent or other person making
such payment or distribution, delivered to the Trustee or to the Holders of
Notes, for the purpose of ascertaining the persons entitled to participate in
such payment or distribution, the holders of Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article XI.

 

SECTION 11.06.  The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness and shall not be liable to any such holders if the 

 

52

 

Trustee shall in good
faith mistakenly pay over or distribute to Holders of Notes or to the Company
or to any other person cash, property or securities to which any holders of
Senior Indebtedness shall be entitled by virtue of this Article XI
or otherwise.  With respect to the
holders of Senior Indebtedness, the Trustee undertakes to perform or to observe
only such of its covenants or obligations as are specifically set forth in this
Article XI and no implied covenants
or obligations with respect to holders of Senior Indebtedness shall be read
into this Indenture against the Trustee.

 

SECTION 11.07.  The
Trustee or any authenticating agent in its individual capacity shall be
entitled to all the rights set forth in this Article XI
with respect to any Senior Indebtedness which may at any time be held by it, to
the same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee or any authenticating agent of any of its
rights as such Holder.

 

Nothing
in this Article XI shall apply to claims
of, or payments to, the Trustee under or pursuant to Section 7.07.

 

53

 

TESTIMONIUM

 

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

 

In Witness whereof, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.

 

	
   

  	
  HSBC Finance
  Corporation

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Craig T. Thiele

  	
   

  
	
   

  	
   

  	
  Craig T. Thiele

  
	
   

  	
   

  	
  Senior Vice President –
  Money 

  & Capital Markets

  

 

 

	
   

  	
  The Bank of New York
  Mellon Trust

  
	
   

  	
  Company, N.A.,

  
	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ D.G. Donovan

  	
   

  
	
   

  	
   

  	
  D.G. Donovan

  
	
   

  	
   

  	
  Vice President

  

 

54

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