Document:

Exhibit 4.1

QWEST
CORPORATION

7.5% Notes due 2014

 

 

Fourth Supplemental Indenture

Dated as
of August 8, 2006

 

U.S. BANK
NATIONAL ASSOCIATION,
 as Trustee

 

 

TABLE OF CONTENTS

 

	
  

  	
   

  	
  Page

  
	
  ARTICLE ONE

  	
   

  
	
   

  	
   

  
	
  THE NOTES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1.01

  	
  Designation of Notes

  	
  2

  
	
  Section 1.02

  	
  Other Terms of the Notes

  	
  2

  
	
   

  	
   

  	
   

  
	
  ARTICLE TWO

  	
   

  
	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Amendment and Supplement

  	
  3

  
	
  Section 2.02

  	
  Indenture

  	
  3

  
	
  Section 2.03

  	
  Governing Law

  	
  3

  
	
  Section 2.04

  	
  No Adverse Interpretation of Other Agreements

  	
  3

  
	
  Section 2.05

  	
  Successors and Assigns

  	
  3

  
	
  Section 2.06

  	
  Duplicate Originals

  	
  3

  
	
  Section 2.07

  	
  Severability

  	
  3

  

 

Exhibits

	
  Exhibit A

  	
  —

  	
  Form of Note

  
	
  Exhibit A-1

  	
  —

  	
  Form of Certificate to be delivered in connection
  with transfers pursuant to Temporary Regulation S Global Note

  
	
  Exhibit A-2

  	
  —

  	
  Form of Certificate to be delivered in connection
  with transfers pursuant to Regulation S

  

 

 

 i

 

FOURTH SUPPLEMENTAL INDENTURE dated as of August 8,
2006 (this ”Supplemental Indenture”) by and
between QWEST CORPORATION, a Colorado corporation (formerly known as U S WEST
Communications, Inc.) (the “Company”), and
U.S. BANK NATIONAL ASSOCIATION, as trustee under the Indenture (as defined
below) with respect to the Notes (as defined below) (the “Trustee”),
as supplemented by the First Supplemental Indenture (as defined below), the
Second Supplemental Indenture (as defined below) and the Third Supplemental Indenture
(as defined below).  The Trustee, and
each other trustee appointed as such with respect to the Securities of any
series issued under the Indenture, shall be the “Trustee” (as defined in the
Indenture, as supplemented hereby) for all purposes under the Indenture with
respect to the applicable series of Securities but, for the avoidance of doubt,
not with respect to any series of Securities for which such Trustee has not
been appointed trustee under the terms of the Indenture and/or any supplement
thereto).

Each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the holders of Notes:

WHEREAS, the Company and J.P. Morgan Trust Company,
National Association (as successor in interest to Bank One Trust Company,
National Association), are parties to that certain Indenture dated as of
October 15, 1999 (the “Base Indenture,”
and as supplemented by the First Supplemental Indenture, the Second
Supplemental Indenture, the Third Supplemental Indenture and this Fourth
Supplemental Indenture, the “Indenture”)
providing for the issuance from time to time of senior debt securities (“Securities”) to be issued in one or more series;

WHEREAS, the Company and the Trustee are parties to
the First Supplemental Indenture (the “First Supplemental
Indenture”) dated as of August 19, 2004, providing for the issuance
by the Company of a series of Securities, designated as its 7.875% Notes due
2011, in an aggregate principal amount of $575,000,000.

WHEREAS, the Company and the Trustee are parties to
the Second Supplemental Indenture (the “Second Supplemental
Indenture”) dated as of November 23, 2004, providing for the issuance
by the Company of Additional Notes of its series of Securities designated as
its 7.875% Notes due 2011, in an aggregate principal amount of $250,000,000.

WHEREAS, the Company and the Trustee are parties to
the Third Supplemental Indenture (the “Third Supplemental
Indenture”) dated as of June 17, 2005, providing for the issuance by
the Company of a series of Securities designated as its 7.625% Notes due 2015
in an aggregate principal amount of $400,000,000 and a series of Securities
designated as its Floating Rate Notes due 2013 in an aggregate principal amount
of $750,000,000.

WHEREAS, the Company desires and has requested the
Trustee to join it in the execution and delivery of this Supplemental Indenture
in order to establish and provide for the issuance by the Company of a series
of Securities, designated as its 7.5% Notes due 2014 (the “Notes”)
in an initial aggregate principal amount of $600,000,000.  The Notes shall be substantially in the form
attached hereto as Exhibit A.

WHEREAS, Section 9.01 of the Base Indenture
provides that a supplemental indenture may be entered into by the Company and
the Trustee without the consent of any Holders 

 

 

to establish the form or terms of Securities of any
Series as permitted by Section 2.02 of the Base Indenture;

WHEREAS, the conditions set forth in the Indenture for
the execution and delivery of this Supplemental Indenture have been complied
with; and

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

NOW, THEREFORE, in consideration of the premises and
the purchase and acceptance of the Notes by the holders thereof, the Company
covenants and agrees with the Trustee, for the equal and ratable benefit of the
Holders, that the Indenture is supplemented and amended, to the extent
expressed herein, as follows:

ARTICLE
ONE

THE NOTES

Section 1.01                                                   Designation
of Notes.

The changes, modifications and supplements to the
Indenture effected by this Supplemental Indenture shall be applicable only with
respect to, and govern the terms of the Notes, which shall not be limited in
aggregate principal amount, and shall not apply to any other Securities that
have been or may be issued under the Indenture unless a supplemental indenture
with respect to such other Securities specifically incorporates such changes,
modifications and supplements.  Pursuant
to this Supplemental Indenture, there is hereby created and designated a series
of Securities under the Indenture entitled “7.5% Notes due October 1, 2014.”  The Notes shall be in the form of Exhibit
A hereto.  The Notes may bear an
appropriate legend regarding original issue discount for federal income tax
purposes.  Subject to the terms in the Indenture,
as supplemented by this Supplemental Indenture, the Company may, at its option,
without consent from the Holders, issue additional Notes from time to
time.  For all purposes under the
Indenture, the term “Notes” shall include the Notes initially issued on the
date of original issuance of the Notes and any other Notes issued  after such date under the Indenture, as supplemented
hereby.

Section 1.02                                                   Other
Terms of the Notes.

Without limiting the foregoing provisions of this
Article One, the terms of the Notes shall be as set forth in the form of Note
set forth in Exhibit A hereto and as provided in the Indenture.

The Notes shall be payable and may be presented for
payment, purchase, conversion, registration of transfer and exchange, without
service charge, at the office of the Company maintained for such purpose in New
York, New York, which shall initially be the office or agency of the Trustee.

 2
 

 

 

ARTICLE
TWO

MISCELLANEOUS

Section 2.01                                                   Amendment
and Supplement.

This Supplemental Indenture or the Notes may be
amended or supplemented as provided for in the Indenture.

Section 2.02                                                   Indenture.

In the event of any conflict between this Supplemental
Indenture and the Indenture, the provisions of this Supplemental Indenture
shall prevail.

Section 2.03                                                   Governing
Law.

The laws of the State of New York shall govern this
Supplemental Indenture and the Securities of the Series created hereby.

Section 2.04                                                   No
Adverse Interpretation of Other Agreements.

This Supplemental Indenture may not be used to
interpret another indenture, loan or debt agreement of the Company or a
Subsidiary.  Any such indenture, loan or
debt agreement may not be used to interpret this Supplemental Indenture.

Section 2.05                                                   Successors
and Assigns.

All covenants and agreements of the Company in this
Supplemental Indenture and the Notes shall bind its successors and
assigns.  All agreements of the Trustee
in this Supplemental Indenture shall bind its successors and assigns.

Section 2.06                                                   Duplicate
Originals.

This Supplemental Indenture may be executed in
counterparts, each of which shall be an original, but such counterparts shall together
constitute but one instrument.

Section 2.07                                                   Severability.

In case any one or more of the provisions contained in
this Supplemental Indenture or in the Notes shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provisions of this Supplemental
Indenture or of the Notes.

[Signature Pages
Follow]

 3

 

 

SIGNATURES

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

	
  

  	
  QWEST CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Janet K. Cooper

  	
   

  
	
   

  	
   

  	
  Name: Janet K. Cooper

  
	
   

  	
   

  	
  Title: Senior Vice President - Finance and Treasurer

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adam M. Dalmy

  	
   

  
	
   

  	
   

  	
  Name: Adam M. Dalmy

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-1

 

 

Exhibit A

[THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY.  THIS NOTE IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER
OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE DEPOSITORY
TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE
DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

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

EXCEPT AS OTHERWISE PROVIDED IN SECTION 2.15 OF THE
INDENTURE, TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF
OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.08 OF THE INDENTURE.](1)

THE NOTES
EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE ‘‘SECURITIES ACT’’) AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2)
IN AN OFFSHORE TRANSACTION COMPLYING WITH 

(1)           This
legend to appear only on Global Notes.

 A-1
 

 

 

RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.

[THIS GLOBAL NOTE IS A TEMPORARY GLOBAL NOTE FOR PURPOSES
OF REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”).  NEITHER THIS
TEMPORARY GLOBAL NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED,
EXCEPT AS PERMITTED UNDER THE INDENTURE REFERRED TO BELOW.

NO BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO
RECEIVE PAYMENT OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED
CERTIFICATIONS HAVE BEEN DELIVERED PURSUANT TO THE TERMS OF THE INDENTURE.](2)

(2)           This legend to appear only on
Temporary Regulation S Global Notes.

 A-2
 

 

 

	
  No.
  [     ]

  CUSIP No.
  [                  ]

  	
  PRINCIPAL AMOUNT

  $[                        ]

  

QWEST CORPORATION

7.5% Note due 2014

QWEST CORPORATION, a corporation duly organized and
existing under the laws of the State of Colorado (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being
herein called the “Company”), for
value received, hereby promises to pay to Cede & Co., or registered
assigns, the principal sum of
[                                
] DOLLARS
($[                  ])
(or such lesser amount as shall be listed on the Schedule of Increases or Decreases
in Global Note attached hereto) on October 1, 2014 (the “Maturity
Date”), unless previously redeemed on any redemption date, by wire
transfer of immediately available funds of such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts and to pay interest thereon semiannually on
each April 1 and October 1, commencing April 1, 2007 (each, an “Interest Payment Date”), and on the Maturity Date at the
rate per annum specified in the title of this Note, from August 8, 2006 (or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for) until payment of said principal sum has been made or duly
provided for.  Notwithstanding the
foregoing, if the Company shall default in the payment of interest due on any
Interest Payment Date, then this Note shall bear interest from the most recent
Interest Payment Date to which interest has been paid or duly provided for or,
if no interest has been paid on this Note or duly provided for, from August 8, 2006.  The interest so payable on any Interest
Payment Date, subject to certain exceptions provided in the Indenture referred
to herein, will be paid to the person in whose name this Note shall be
registered at the close of business on each March 15 and September 15
immediately prior to such Interest Payment Date, Maturity Date or redemption
date.  If any Interest Payment Date,
Maturity Date or redemption date is a Legal Holiday (as defined in the
Indenture) in New York, New York, the required payment shall be made on the
next succeeding day that is not a Legal Holiday as if it was made on the date
such payment was due and no interest will accrue on the amount so payable for
the period from and after such Interest Payment Date or Maturity Date, as the
case may be, to such next succeeding day. 
Interest will be computed on the basis of a 360-day year consisting of
twelve 30-day months.

This Note is one of the duly authorized series of
Securities of the Company, designated as the Company’s “7.5% Notes due 2014”
(the “Notes”), initially limited to the aggregate
principal amount of $600,000,000 all issued or to be issued under and pursuant
to an Indenture dated as of October 15, 1999 between the Company and J.P.
Morgan Trust Company, National Association, as trustee (as successor in
interest to Bank One Trust Company, N.A.), as supplemented by the First
Supplemental Indenture dated as of August 19, 2004 by and between the
Company and U.S. Bank National Association, as trustee (the “Trustee”), the Second Supplemental Indenture dated as of
November 23, 2004 between the Company and the Trustee, a Third Supplemental
Indenture dated as of June 17, 2005 between the Company and the Trustee and a
Fourth Supplemental Indenture dated as of August 8, 2006 between the Company and
the Trustee as such may be amended, modi-

 A-3
 

 

 

fied or supplemented from time to time (as so amended,
modified or supplemented, the “Indenture”), to
which Indenture and all Indentures supplemental thereto reference is hereby
made for a description of the rights, limitation of rights, obligations, duties
and immunities thereunder of the Trustee, the Company and the Holders (the
words “Holders” or “Holder”
meaning the registered holders or registered holder of the Notes).  Exchange Notes (as such term is defined in
the Registration Rights Agreement referred to below) shall be deemed to be of
the same series as the Notes for purposes of the Indenture.

Pursuant to, but subject to the exceptions in, the
Registration Rights Agreement dated as of August 8, 2006 among the Company and
the Initial Purchasers named therein (as the same may be amended from time to
time, the “Registration Rights Agreement”), the Company
shall be obligated to use its commercially reasonable efforts to consummate an
exchange offer pursuant to which the Holder of this Note shall have the right
to exchange this Note for a 7.5% Note due October 1, 2014 of the Company which
shall have been registered under the Securities Act of 1933, as amended, in
like principal amount and having terms identical in all material respects to
this Note (except that such Note shall not be entitled to Additional Interest
(as defined in the Registration Rights Agreement) and shall not contain terms
with respect to transfer restrictions). 
Holders shall be entitled to receive certain Additional Interest in the
event of a Registration Default (as defined in the Registration Rights
Agreement) pursuant to and in accordance with the terms of the Registration
Rights Agreement.  Any Additional
Interest due will be payable in cash on the next succeeding April 1 or October
1, as the case may be, to Holders on the relevant regular record dates for the
payment of interest.  The Company shall
promptly provide the Trustee with notice of any change in the interest rate
borne by this Note.(3)

The Notes shall be redeemable at the option of the
Company in whole at any time or in part from time to time, at a redemption
price equal to the greater of (i) 100% of the principal amount of the
Notes to be redeemed or (ii) the sum, as determined by the Quotation Agent
(as defined below), of the present values of the principal amount of the Note
to be redeemed and the remaining scheduled payments of interest on the
principal amount of this Note to be redeemed from the redemption date to
October 1, 2014 (excluding interest accrued to the redemption date) (the “Remaining Life”), discounted from their respective scheduled
payment dates to the redemption date on a semiannual basis (assuming a 360-day
year consisting of 30-day months) at the Treasury Rate (as defined below) plus
50 basis points, plus, in either case, accrued interest thereon to the date of
redemption.

If money
sufficient to pay the redemption price of and accrued interest on all of the
Notes (or portions thereof) to be redeemed on the redemption date is deposited
with the Trustee or paying agent on or before the redemption date and certain
other conditions specified in the Indenture are satisfied, then on and after
such redemption date, interest will cease to accrue on such Notes (or such
portion thereof) called for redemption.

(3)           This
paragraph not to appear on Exchange Notes.

 A-4
 

 

 

“Comparable Treasury Issue”
means the United States Treasury security selected by the Quotation Agent as
having a maturity comparable to the Remaining Life that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity with the
Remaining Life as of the applicable redemption date. “Comparable Treasury Price”
means, with respect to any redemption date, the average of two Reference
Treasury Dealer Quotations for such redemption date.

“Quotation Agent”
means the Reference Treasury Dealer appointed by the Company.

“Reference Treasury Dealer”
means each of Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner
& Smith Incorporated and their successors; provided, however, that if any
of the foregoing ceases to be a primary U.S. Government securities dealer in
New York City, the Company will substitute therefor another primary U.S.
Government securities dealer.

“Reference Treasury Dealer
Quotations” means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Trustee, of the bid
and asked prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Trustee by such
Reference Treasury Dealer at 5:00 p.m., New York City time, on the third
business day preceding such redemption date.

“Treasury Rate”
means, with respect to any redemption date, the rate per annum equal to the
semiannual yield to maturity of the Comparable Treasury Issue, calculated on
the third business day preceding such redemption date using a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount)
equal to the Comparable Treasury Price for such redemption date.

Notice of any redemption will be mailed not less than
15 nor more than 60 calendar days before the redemption date to the Holder
hereof at its registered address.  Unless
the Company defaults in payment of the redemption price, on and after the
redemption date interest will cease on the principal amount of this Note.

In case an Event of Default shall occur and be
continuing, the principal hereof may be declared, and upon such declaration
shall become, due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.

The Indenture contains provisions permitting the
Company and the Trustee, with the written consent of the Holders of a majority
in principal amount of the outstanding Securities of each series affected by a
supplemental indenture (with each series voting as a class), to enter into a
supplemental indenture to add any provisions to or to change or eliminate any
provisions of the Indenture or of any supplemental indenture or to modify, in
each case in any manner not covered by provisions in the Indenture relating to
amendments and waivers without the consent of Holders, the rights of the Holders
of each such series.  The Holders of a
majority in principal amount of the outstanding Securities of each series
affected by such waiver (with each series voting as a class), by notice to the
Trustee may waive compliance by the Company with any provi-

 A-5
 

 

 

sion of the Indenture, any supplemental indenture or
the Securities of any such series, except a Default in payment of the principal
of or interest on any Security.  However,
without the consent of each Holder affected, an amendment or waiver may not:
(1) reduce the amount of Notes whose Holders must consent to an amendment
or waiver; (2) change the rate or the time for payment of interest on any
Security; (3) change the principal or the fixed maturity of any Security;
(4) waive a Default in the payment of principal, premium, if any, or
interest on any Security; (5) make any Security payable in money other
than that stated in the Security; or (6) make any change in the provisions
of the Indenture (i) with respect to the rights of the Holders of a majority
in principal amount of any series of Securities, by notice to the Trustee, to
waive an existing Default with respect to that series and its consequences;
(ii) with respect to the right of any Holder of a Security to receive
payment of principal of and interest on the Security, on or after the
respective due dates expressed in the Security, the right of any Holder of a
coupon to receive payment of interest due as provided in such coupon, or the
right to bring suit for enforcement of any such payments on or after their
respective dates; and (iii) described in this sentence.

No reference herein to the Indenture and no provision
of this Note or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, premium,
if any, and interest on this Note at the place, at the respective times, at the
rate, and in the coin or currency herein prescribed.

No director, officer, employee or stockholder, as
such, of the Company shall have any liability for any obligations of the
Company under this Note or the Indenture or for any claim based on, in respect
of or by reason of such obligations or their creation.  Each Holder, by accepting this Note, waives
and releases all such liability.  The
waiver and release are part of the consideration for the issue of this Note.

The laws of the State of New York shall govern the
Indenture and this Note.

Ownership of this Note shall be proved by the register
for the Notes kept by the Registrar.  The
Company, the Trustee and any agent of the Company may treat the person in whose
name a Note is registered as the absolute owner thereof for all purposes.

Terms used herein without definition that are defined
in the Indenture shall have the meanings assigned to them in the Indenture.

Customary abbreviations may be used in the name of a
Holder or an assignee, such as:  TEN COM
(= tenants in common), TEN ENT (= tenants by the entirety), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (= Custodian),
and U/G/M/A (= Uniform Gifts to Minors Act).

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

 A-6
 

 

 

Unless the Certificate of Authentication hereon has
been executed by the Trustee under the Indenture referred to herein by the
manual or facsimile signature of one of its authorized officers, or on behalf
of the Trustee by the manual or facsimile signature of an authorized officer of
the Trustee’s authenticating agent, this Note shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.

 A-7
 

 

 

IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed, manually or by facsimile, and its corporate seal or a
facsimile of its corporate seal to be imprinted herein.

Date: 
[                  ]

	
  

  	
  QWEST
  CORPORATION

  
	
  (SEAL)

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 A-8
 

 

 

CERTIFICATE OF
AUTHENTICATION

This is one of the Notes of the series designated
herein, issued under the Indenture described herein.

	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,

  as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

 A-9
 

 

 

ASSIGNMENT FORM

	
  FOR VALUE RECEIVED, the
  undersigned hereby sell(s), assign(s) and transfer(s) unto

  
	
   

  

 

 

 

	
  Please insert social
  security number or other identifying number of assignee:

  
	
   

  
	
   

  	
   

  

 

	
  Please print or type name
  and address (including zip code) of assignee:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

the within Note and all
rights thereunder, hereby irrevocably constituting and appointing
                                   
attorney to transfer said Note of Qwest Corporation on the books of Qwest
Corporation, with full power of substitution in the premises.

	
  

  
	
  Dated:

  	
   

  	
   

  

 

NOTICE:  The
signature to this assignment must correspond with the name as written upon the
face of this Note in every particular without alteration or enlargement or any
change whatsoever.

 A-10
 

 

 

CERTIFICATE TO BE
DELIVERED UPON EXCHANGE

OR REGISTRATION OF TRANSFER

This certificate relates to $                  
principal amount of Notes held in (check applicable space)                   
book-entry or
                  
definitive form by the undersigned.

The undersigned (Check one box below);

[   ] 
has requested the Trustee by written order to deliver in exchange for
its beneficial interest in the Note held by the Depository a Note or Notes in
definitive, registered form of authorized denominations and an aggregate
principal amount equal to its beneficial interest in such Note (or the portion
thereof indicated above); or

[   ] 
has requested the Trustee by written order to exchange or register the
transfer of a Note or Notes.

In connection with any transfer of any of the Notes
evidenced by this certificate occurring prior to the expiration of the period
referred to in Rule 144(k) under the Securities Act, the undersigned
confirms that such Notes are being transferred in accordance with its terms:

CHECK ONE BOX BELOW

[   ]          (1)           to the Company; or

[   ]          (2)           inside the United States to a “qualified
institutional buyer” (as defined in Rule 144A under the Securities Act) that
purchases for its own account or for the account of a qualified institutional
buyer in a transaction meeting the requirements of Rule 144A; or

[   ]          (3)           outside the United States to a
foreign person in a transaction meeting the requirements of Rule 903 or Rule
904 of Regulation S under the Securities Act; or

[   ]          (4)           pursuant to an exemption from
registration under the Securities Act provided by Rule 144 thereunder (if
available), or

[   ]          (5)           to an institutional accredited
investor in a transaction exempt from the registration requirements of the
Securities Act, or

[   ]          (6)           pursuant to an effective registration
statement under the Securities Act.

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

 A-11
 

 

 

being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities
Act.

	
  Date: 

  	
   

  	
   

  	
   

  
	
   

  	
  SIGNATURE OR SIGNATURE GUARANTEE:

  
	
   

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

  

 

 A-12
 

 

 

TO BE COMPLETED BY
PURCHASER IF BOX (2) ABOVE IS CHECKED.

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

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  NOTICE: To be
  executed by an executive officer

  	
   

  

 A-13
 

 

 

SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL NOTE

The following increases or decreases in this Global
Note have been made:

	
  Principal amount

  of this Global Note

  as of [             ]

  	
   

  	
  Date

  Exchange

  Made

  	
   

  	
  Change in

  Principal Amount

  of this Global Note

  due to Exchange

  	
   

  	
  Principal Amount

  of this Global Note

  Following such

  Exchange

  	
   

  	
  Notation made by

  or on behalf of the

  Company

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 A-14

 

Exhibit
A-1

Form of
Certificate To Be Delivered

in Connection with Transfers

of Temporary Regulation S Global Notes

[                ],
[     ]

U.S. Bank National
Association

950 17th Street, Suite 300

Denver, Colorado 80202

Attention:  Corporate Trust Department

Re:                               Qwest
Corporation (the “Issuer”)

7.5% Notes due 2014 (the “Notes”)

Dear Sirs:

This letter relates to U.S.
$[                            ]
aggregate principal amount of Notes represented by a certificate (the “Legended Certificate”) which bears a legend outlining
restrictions upon transfer of such Legended Certificate.  Pursuant to Section 3.03(b) of the First
Supplemental Indenture (the “Supplemental Indenture”)
dated as of August 19, 2004 relating to the Notes, we hereby certify that
we are (or we will hold such securities on behalf of) a person outside the
United States (or to an Initial Purchaser (as defined in the Supplemental
Indenture)) to whom the Notes could be transferred in accordance with
Rule 904 of Regulation S promulgated under the U.S. Securities Act of
1933, as amended.

You, as Trustee, the Company, counsel for the Company
and others are entitled to rely upon this letter and are irrevocably authorized
to produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.  Capitalized
terms used but not independently defined in this letter have the meanings set
forth in Regulation S.

	
  

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Name of Holder]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Signature

  

 

 A-1-1

 

Exhibit
A-2

Form of
Certificate To Be Delivered

in Connection with Transfers

          Pursuant to
Regulation S         

[                ],
[     ]

U.S. Bank National
Association

950 17th Street, Suite 300

Denver, Colorado 80202

Attention:  Corporate Trust Department

Re:                               Qwest
Corporation (the “Issuer”)

7.5% Notes due 2014 (the “Notes”)

Ladies and Gentlemen:

In connection with our proposed sale of
$[                 ]
aggregate principal amount of the Notes, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the U.S.
Securities Act of 1933, as amended (the “Securities  Act”), and, accordingly, we represent that:

(1)           the
offer of the Notes was not made to a person in the United States;

(2)           either
(a) at the time the buy offer was originated, the transferee was outside the
United States or we and any person acting on our behalf reasonably believed
that the transferee was outside the United States, or (b) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither we nor any person acting on our behalf knows that the
transaction has been prearranged with a buyer in the United States;

(3)           no
directed selling efforts have been made in the United States in contravention
of the requirements of Rule 903(b) or Rule 904(b) of Regulation S, as applicable;

(4)           the
transaction is not part of a plan or scheme to evade the registration requirements
of the Securities Act; and

(5)           we
have advised the transferee of the transfer restrictions applicable to the
Notes.

 A-2-1
 

 

 

You, as Trustee, the Issuer, counsel for the Issuer
and others are entitled to rely upon this letter and are irrevocably authorized
to produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the matters
covered hereby.  Terms used in this
certificate have the meanings set forth in Regulation S.

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Name of Transferor]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

 A-2-2Exhibit
10.1

 

 

 

REGISTRATION
RIGHTS AGREEMENT

Dated August 8,
2006

among

QWEST CORPORATION,

as Issuer,

and

Deutsche Bank Securities Inc.

Credit Suisse Securities (USA) LLC

Merrill Lynch, Pierce, Fenner
& Smith Incorporated,
As Representatives of the Initial
Purchasers

 

 

 

REGISTRATION RIGHTS
AGREEMENT

This Registration Rights Agreement (this “Agreement”)
is dated as of August 8, 2006, among QWEST CORPORATION, a Colorado corporation
(the “Issuer” or the “Company”), on the one hand, and the several
Initial Purchasers named in Schedule A 
to the Purchase Agreement as defined below (each, an “Initial
Purchaser” and collectively, the “Initial Purchasers”), on the other
hand, who have each agreed to purchase, severally and not jointly, pursuant to
the Purchase Agreement (as defined below) a specified amount of newly issued
7.5% Notes due 2014 (the “Securities”).

This Agreement is made pursuant to the Purchase
Agreement, dated as of August 3, 2006 (the “Purchase Agreement”), by and
among the Issuer and the Initial Purchasers (i) for the benefit of the Issuer
and the Initial Purchasers and (ii) for the benefit of the holders form time to
time of the Securities (including the Initial Purchasers).  In order to induce the Initial Purchasers to
purchase the Securities, the Issuer has agreed to provide the registration
rights set forth in this Agreement.  The
execution and delivery of this Agreement is a condition to the obligations of
the Initial Purchasers set forth in Section 5 of the Purchase Agreement.  Capitalized terms used herein and not
otherwise defined shall have the meaning assigned to them in the Purchase Agreement.

In consideration of the foregoing, the parties hereto
agree as follows for the benefit of each other and for the equal and ratable
benefit of the Holders of the Securities:

1.                                      Definitions.

As used in this Agreement, the following capitalized
defined terms shall have the following meanings:

“1933 Act” shall mean the Securities Act of
1933, as amended, or any successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.

“1934 Act” shall mean the Securities Exchange
Act of 1934, as amended, or any successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.

“Additional Interest” shall have the meaning
set forth in Section 2(d) hereof.

“Affiliate” shall mean with respect to any
Person, any other Person directly or indirectly controlling, controlled by, or
under common control with, such Person; for purposes of this definition, “control”
shall mean the possession, directly or indirectly, of the power to

 

 

direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities or
otherwise.

“Broker-Dealer Representative” means Deutsche
Bank Securities Inc., Credit Suisse Securities (USA) LLC and Merrill Lynch,
Pierce, Fenner & Smith Incorporated.

“Closing Date” shall have the meaning set forth
in the Purchase Agreement.

“Company” shall have the meaning set forth in
the preamble and shall also include the Company’s successors and assigns.

“Effectiveness Target Date” shall have the
meaning set forth in Section 2(a) hereof.

“Exchange Date” shall have the meaning set
forth in Section 2(a)(ii) hereof.

“Exchange Offer” shall mean the exchange offer
by the Issuer of Exchange Securities for Registrable Securities pursuant to Section
2(a) hereof.

“Exchange Offer Registration” shall mean a
registration under the 1933 Act effected pursuant to Section 2(a)
hereof.

“Exchange Offer Registration Statement” shall
mean an exchange offer registration statement on Form S-4 (or, if applicable,
on another appropriate form) and all amendments and supplements to such
registration statement, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.

“Exchange Period” shall have the meaning set
forth in Section 2(a) hereof.

“Exchange Securities” shall mean securities,
issued by the Issuer under the Indenture containing terms identical to the
Securities (except that the Exchange Securities will not contain restrictions
on transfer and Additional Interest) and to be offered to Holders of Securities
in exchange for Securities pursuant to the Exchange Offer.

 “Holder”
shall mean a holder of Registrable Securities, for so long as such holder owns
any Registrable Securities, and each of such holder’s successors, assigns and direct
and indirect transferees who become registered owners of Registrable Securities
under the Indenture or who become beneficial owners of Registrable Securities,
so long as in the case of beneficial owners, such owners have so notified the
Issuer in writing; provided that for purposes of Sections 4
and 5 of this Agreement, the term “Holder” shall include Participating
Broker-Dealers.

“Indenture” shall mean the Indenture relating
to the Securities dated as of October 15, 1999 between the Company
(formerly known as U S WEST Communications, Inc.),

 2
 

 

 

as issuer, and J.P. Morgan Trust Company, National
Association (as successor in interest to Bank One Trust Company, N.A.), as supplemented
by a supplemental indenture establishing the terms of the Securities, as the
same may be amended or supplemented from time to time in accordance with the
terms thereof.

“Majority Holders” shall mean the Holders of a
majority of the aggregate principal amount of outstanding Registrable
Securities; provided that whenever the consent or approval of Holders of
a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Issuer or any of its Affiliates shall not be
counted in determining whether such consent or approval was given by the
Holders of such required percentage or amount.

“Participant” shall have the meaning set forth
in Section 5(a) hereof.

“Participating Broker-Dealer” shall have the
meaning set forth in Section 4(a) hereof.

“Person” shall be construed broadly and shall
include, without limitation, an individual, a partnership, a corporation, an
association, a joint stock company, a limited liability company, a trust, a
joint venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.

“Prospectus” shall mean the prospectus included
in a Registration Statement, including any preliminary prospectus, and any such
prospectus as amended or supplemented by any prospectus supplement, including a
prospectus supplement with respect to the terms of the offering of any portion
of the Registrable Securities covered by a Shelf Registration Statement, and by
all other amendments and supplements to such prospectus, and in each case
including all material incorporated by reference therein.

“Registrable Securities” shall mean the
Securities; provided, however, that the Securities shall cease to
be Registrable Securities (i) when, in the case of a Holder of such Securities
who was entitled to participate in the Exchange Offer, an Exchange Offer
Registration Statement with respect to such Securities shall have been declared
effective under the 1933 Act and either (a) such Securities shall have been
exchanged pursuant to the Exchange Offer for Exchange Securities or (b) such
Securities were not tendered by the Holder thereof in the Exchange Offer, (ii)
when a Shelf Registration Statement with respect to such Securities shall have
been declared effective under the 1933 Act and such Securities shall have been
disposed of pursuant to such Shelf Registration Statement, (iii) when such
Securities have been sold to the public pursuant to Rule 144(k) (or any similar
provision then in force, but not Rule 144A) under the 1933 Act or are eligible
to be sold without restriction thereunder or (iv) when such Securities shall
have ceased to be outstanding.

“Registration Default” shall have the meaning
set forth in Section 2(d) hereof.

 3
 

 

 

“Registration Expenses” shall mean any and all
expenses incident to performance of or compliance by the Issuer with this
Agreement, including, without limitation: 
(i) all SEC, New York Stock Exchange or National Association of
Securities Dealers, Inc. registration and filing fees, (ii) all fees and
expenses incurred in connection with compliance with state securities or blue
sky laws (including reasonable fees and disbursements of one counsel for all
underwriters or Holders as a group in connection with blue sky qualification of
any of the Exchange Securities or Registrable Securities) within the United
States (x) where the Holders are located, in the case of the Exchange Securities,
or (y) as provided in Section 3(d) hereof, in the case of
Registrable Securities to be sold by a Holder pursuant to a Shelf Registration
Statement, (iii) all expenses of any Persons in preparing or assisting in
preparing, word processing, printing and distributing any Registration
Statement, any Prospectus, any amendments or supplements thereto and other
documents relating to the performance of and compliance with this Agreement,
(iv) all rating agency fees, (v) all fees and disbursements relating to the
qualification of the Indenture under applicable securities laws, (vi) the fees
and disbursements of the Trustee and its counsel, (vii) the fees and
disbursements of counsel for the Issuer and, in the case of a Shelf
Registration Statement, the fees and disbursements of one counsel for the
Holders (which counsel shall be selected by the Majority Holders) and (viii)
the fees and disbursements of the independent public accountants of the Issuer,
including the expenses of any special audits, agreed-upon procedures or “cold
comfort” letters required by or incident to such performance and compliance,
but excluding fees and expenses of counsel to the underwriters (other than fees
and expenses set forth in clause (ii) above) or the Holders and underwriting
discounts and commissions and out-of-pocket expenses incurred by the Holders
and transfer taxes, if any, relating to the sale or disposition of Registrable
Securities by a Holder.

“Registration Statement” shall mean any
registration statement of any Issuer that covers any of the Exchange Securities
or Registrable Securities pursuant to the provisions of this Agreement and all
amendments and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.

“SEC” shall mean the Securities and Exchange
Commission.

“Securities” shall have the meaning set forth
in the preamble.

“Shelf Registration” shall mean a registration effected
pursuant to Section 2(b) hereof.

“Shelf Registration Statement” shall mean a “shelf”
registration statement of the Issuer pursuant to the provisions of Section
2(b) of this Agreement which covers at effectiveness all of the Registrable
Securities (other than Registrable Securities the Holders of which have not
complied with its obligations under Section 2(f) of this Agreement
or have elected not to have their Registrable Securities included in the Shelf
Registration Statement)

 4
 

 

 

on an appropriate form under Rule 415 under the 1933
Act, or any similar rule that may be adopted by the SEC, and all amendments and
supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all exhibits
thereto and all material incorporated by reference therein.

“TIA” shall have the meaning set forth in Section
3(l) hereof.

“Trustee” shall mean the trustee with respect
to the Securities under the Indenture.

“Underwriters” shall have the meaning set forth
in Section 3 hereof.

“Underwritten Offering” shall mean a
registration in which Registrable Securities are sold to an Underwriter for reoffering
to the public.

2.                                      Registration
Under the 1933 Act.

(a)           To
the extent not prohibited by any applicable law or applicable interpretation of
the Staff of the SEC, the Issuer shall file an Exchange Offer Registration Statement
covering the offer by the Issuer to the Holders to exchange all of the
Registrable Securities for Exchange Securities in a like aggregate principal
amount and to use its commercially reasonable efforts to cause the Exchange
Offer Registration Statement to be declared effective by 315 days after the
date of this Agreement (the “Effectiveness Target Date”) and to have
such Registration Statement remain effective until the closing of the Exchange
Offer.  The Issuer shall commence the
Exchange Offer as promptly as practicable after the Exchange Offer Registration
Statement has been declared effective by the SEC and use its commercially reasonable
efforts to have the Exchange Offer consummated not later than 45 days after the
earlier of the date on which the Exchange Offer Registration Statement is declared
effective and the Effectiveness Target Date (such 45-day period being the “Exchange
Period”).

The Issuer shall commence the Exchange Offer by
mailing the related exchange offer Prospectus and accompanying documents to
each Holder stating, in addition to such other disclosures as are required by
applicable law:

(i)      that the Exchange Offer is being made pursuant
to this Registration Rights Agreement and that all Registrable Securities
validly tendered will be accepted for exchange;

(ii)     the date of acceptance for exchange (which
shall be a period of at least 20 business 
days (or longer if required by applicable law) from the date such notice
is mailed (the “Exchange Date”);

 5
 

 

 

(iii)    that any Registrable Security not tendered
by a Holder who was eligible to participate in the Exchange Offer will remain
outstanding and continue to accrue interest, but will not retain any rights
under this Registration Rights Agreement;

(iv)    that Holders electing to have a Registrable
Security exchanged pursuant to the Exchange Offer will be required to surrender
such Registrable Security, together with the enclosed letters of transmittal,
to the institution and at the address (located in the Borough of Manhattan, The
City of New York) specified in the notice prior to the close of business on the
Exchange Date; and

(v)     that Holders will be entitled to withdraw
their election, not later than the close of business, New York City time, on
the Exchange Date, by sending to the institution and at the address (located in
the Borough of Manhattan, The City of New York) specified in the notice, a
facsimile transmission or letter setting forth the name of such Holder, the
principal amount of Registrable Securities delivered for exchange and a
statement that such Holder is withdrawing his election to have such Securities
exchanged.

As soon as practicable after the Exchange Date, the
Issuer shall:

(vi)    accept for exchange Registrable Securities
or portions thereof validly tendered and not properly withdrawn pursuant to the
Exchange Offer; and

(vii)   deliver, or cause to be delivered, to the
Trustee for cancellation all Registrable Securities or portions thereof so
accepted for exchange by the Issuer and issue, and cause the Trustee to
promptly authenticate and mail to each Holder, an Exchange Security equal in
principal amount to the principal amount of the Registrable Securities surrendered
by such Holder; provided that, in the case of any Registrable Securities
held in global form by a depositary, authentication and delivery to such depositary
of one or more Exchange Securities in global form in an equivalent principal
amount thereto for the account of such Holders in accordance with the Indenture
shall satisfy such authentication and delivery requirement.

Each Holder (including, without limitation, each
Participating Broker-Dealer (as defined)) who participates in the Exchange
Offer will be required to represent to the Issuer, in writing (which may be
contained in the applicable letter of transmittal) that: (1) any Exchange
Securities acquired in exchange for Registrable Securities tendered are being acquired
in the ordinary course of business of the Person receiving such Exchange Securities,
whether or not such recipient is a Holder of Registrable Securities, (2)
neither such Holder nor, to the actual knowledge of such Holder, any other
Person receiving Exchange Securities from such Holder has an arrangement or
understanding with any Person to participate in the distribution of the
Exchange Securities in violation of the provisions of the 1933 Act, (3) the
Holder is not an Affiliate of any Issuer or, if it is an Affiliate, it will
comply with the registration

 6
 

 

 

and prospectus delivery requirements of the 1933 Act
to the extent applicable, (4) if such Holder is not a Participating
Broker-Dealer, that it has not engaged in, and does not intend to engage in,
the distribution of Exchange Securities, (5) if such Holder is a Participating
Broker-Dealer, such Holder acquired the Registrable Securities as a result of
market-making activities or other trading activities, it will deliver a
prospectus in connection with any resale of the Exchange Securities and that it
will comply with the applicable provisions of the 1933 Act with respect to
resale of any Exchange Securities and (6) such Holder has full power and authority
to transfer the Registrable Securities in exchange for the Exchange Securities.

The Issuer shall comply with the applicable requirements
of the 1933 Act, the 1934 Act and other applicable laws and regulations in
connection with the Exchange Offer.  The
Exchange Offer shall not be subject to any conditions, other than (1) that the
Exchange Offer does not violate applicable law or any applicable interpretation
of the Staff of the SEC, (2) that no action or proceeding shall have been
instituted or threatened in any court or by any governmental agency with
respect to the Exchange Offer and no material adverse development shall have
occurred with respect to any Issuer, (3) that all governmental approvals shall
have been obtained that the Issuer deems necessary for the consummation of the
Exchange Offer, (4) that the conditions precedent to the Issuer’s obligations
under this Agreement shall have been fulfilled and (5) such other conditions as
shall be deemed necessary or appropriate by the Issuer in its reasonable
judgment.

(b)           In
the event that (i) the Issuer determines that the Exchange Offer Registration
provided for in Section 2(a) above is not available or may not be
consummated as soon as practicable after the Exchange Date because it would
violate applicable law or the applicable interpretations of the Staff of the
SEC, (ii) the Exchange Offer Registration Statement is not declared effective
by the Effectiveness Target Date, (iii) any Holder of Securities notifies
the Issuer after the commencement of the Exchange Offer that due to a change in
applicable law or SEC policy it is not entitled to participate in the Exchange
Offer, or (iv) if any Holder that participates in the Exchange Offer (and
tenders its Registrable Securities prior to the expiration thereof), does not
receive Exchange Securities on the date of the exchange that may be sold
without restriction under state and federal securities laws (other than due
solely to the status of such Holder as an Affiliate of the Issuer or as a
Participating Broker-Dealer), the Issuer shall cause to be filed as soon as
practicable a Shelf Registration Statement providing for the sale by the
Holders of all of the Registrable Securities and shall use its commercially
reasonable efforts to have such Shelf Registration Statement declared effective
by the SEC.  In the event the Issuer is
required to file a Shelf Registration Statement solely as a result of the
matters referred to in clause (iii) of the preceding sentence, the Issuer shall
file and use its commercially reasonable efforts to have declared effective by
the SEC both an Exchange Offer Registration Statement pursuant to Section
2(a) with respect to all Registrable Securities and a Shelf Registration
Statement (which may be a combined Registration Statement with the Exchange
Offer Registration Statement) with respect to offers and sales of Registrable
Securities held by such other Holders after completion of the Exchange Offer.  The

 7
 

 

 

Issuer agrees, except as set forth herein, to use its commercially
reasonable efforts to keep the Shelf Registration Statement continuously
effective until the date that is two years after the Closing Date (or such
shorter periods as may hereafter be referred to in Rule 144(k) under the
Securities Act (or similar successor rule)) with respect to the Registrable
Securities or such shorter period that will terminate when all of the
Registrable Securities covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement.  The Issuer further agrees to supplement or
amend the Shelf Registration Statement if required by the rules, regulations or
instructions applicable to the registration form used by the Issuer for such
Shelf Registration Statement or by the 1933 Act or by any other rules and
regulations thereunder for shelf registration or if reasonably requested by a
Holder with respect to information relating to such Holder, and to use its
commercially reasonable efforts to cause any such amendment to become effective
and such Shelf Registration Statement to become usable as soon as thereafter
practicable.  The Issuer agrees to furnish
to the Holders of Registrable Securities, upon request, copies of any such
supplement or amendment promptly after its being used or filed with the
SEC.  Notwithstanding the foregoing, the
Issuer shall not be required to file more than one post-effective amendment to
the Shelf Registration Statement in any fiscal quarter, such timing to be
determined in the reasonable discretion of the Issuer, to add one or more Holders
to the “Selling Securityholders” table of the Shelf Registration Statement or
to update any information in such table. 
Notwithstanding anything to the contrary contained herein, if any
exchange offer is consummated after the Exchange Date, any obligations of the
Issuer arising as a result of clauses (ii) and (iii) above shall terminate and
such exchange offer shall be deemed an Exchange Offer pursuant to Section
2(a).

(c)           The
Issuer shall pay all Registration Expenses in connection with the registration
pursuant to Section 2(a) or Section 2(b).  Each Holder shall pay all underwriting discounts
and commissions and transfer taxes, if any, relating to the registration of
such Holder’s Registrable Securities pursuant to the Exchange Offer
Registration Statement or the Shelf Registration Statement.

(d)           An
Exchange Offer Registration Statement pursuant to Section 2(a) hereof or
a Shelf Registration Statement pursuant to Section 2(b) hereof will not
be deemed to have become effective unless it has been declared effective by the
SEC; provided, however, that, if, after it has been declared
effective, the offering of Registrable Securities pursuant to a Shelf
Registration Statement is interfered with by any stop order, injunction or
other order or requirement of the SEC or any other governmental agency or
court, such Registration Statement will be deemed not to be effective during
the period of such interference until the offering of Registrable Securities
pursuant to such Registration Statement may legally resume.  As provided for in the Indenture, the annual
interest rate on the Securities will be increased (the “Additional Interest”)
under the following condition:

 8

 

 

subject to Sections 2(f) and 2(g) if (A)
the Issuer has not exchanged Exchange Securities for all Securities validly
tendered in accordance with the terms of the Exchange Offer on or prior to the
end of the Exchange Period (and the Shelf Registration Statement has not been
declared effective), (B) the Exchange Offer Registration Statement or, if
applicable, the Shelf Registration Statement has not been declared effective by
the SEC on or prior to the Effectiveness Target Date or (C) if applicable, the
Shelf Registration Statement is filed and declared effective but shall
thereafter cease to be effective or usable (1) as a result of an order
suspending the effectiveness of the Shelf Registration Statement or otherwise,
or (2) if related to the events or circumstances set forth in Section 2(g)
below, for more than 60 days (whether or not consecutive) in any twelve month
period (each such event referred to in clauses (A) through (C), a “Registration
Default”), then Additional Interest shall accrue on the principal amount of
the Registrable Securities at a rate of 0.25% per annum commencing (x) at
the end of the Exchange Period, in the case of (A) above, (y) on the Effectiveness
Target Date in the case of (B) above, or (z) on the day such Shelf Registration
Statement ceases to be effective in the case of (C)(1) above or the 61st day
the Prospectus ceases to be usable for resales in the case of (C)(2) above, and
such Additional Interest rate shall continue to, but excluding, the earlier of
(1) the date on which all Registration Defaults have been cured or (2) the date
that is two years after the Closing Date (or such shorter period as may
hereafter be referenced to in Rule 144(k) under the Securities Act (or
similar successor rule)) (it being understood and agreed that, notwithstanding
any provision to the contrary, so long as any Securities not registered under
an Exchange Offer Registration Statement by the Effectiveness Target Date or validly
tendered on or prior to the end of the Exchange Period, (y) have been provided
the opportunity to be tendered in an Exchange Offer that closes after the
Exchange Period or (z) are then covered by an effective Shelf Registration
Statement, no Additional Interest shall accrue on such Securities);

provided, however, that upon
the exchange of Exchange Securities for all Securities tendered (in the case of
clause (A) above), upon the earlier of (1) effectiveness of the Shelf
Registration Statement (in the case of clause (B) above) and (2) the
exchange of Exchange Securities for all securities tendered in an Exchange
Offer (in the case of clause (B) above) or upon the effectiveness of the Shelf
Registration Statement which had ceased to remain effective (in the case of
clause (C) above), Additional Interest on the Securities as a result of such
clause (or the relevant subclause thereof), as the case may be, shall cease to
accrue; provided, further, however, that in the case of
clauses (B) and (C) above, it is expressly understood that Additional Interest
should be payable only with respect to the Registrable Securities so requested
to be registered pursuant to Section 2(b)(iii) hereof; and provided,
further, however, that if a Registration Default under
clause (C) above occurs because of the filing of a post-effective

 9
 

 

 

amendment to such Registration Statement to
incorporate annual audited financial information with respect to the Issuer or
to add Holders to the “Selling Securityholders” table (or to update any
information in such table) where such post-effective amendment is not yet effective
and needs to be declared effective to permit Holders to use the related
Prospectus, it is expressly understood that Additional Interest shall be payable
only from and after the date such Registration Default continues for at least
30 days.

Notwithstanding the foregoing, (1) the amount of
Additional Interest payable shall not increase because more than one Registration
Default has occurred and is pending and (2) a Holder of Registrable Securities
or Exchange Securities who is not entitled to the benefits of the Shelf
Registration Statement (i.e., such Holder has not elected to include
information) shall not be entitled to Additional Interest with respect to a
Registration Default that pertains to the Shelf Registration Statement.

(e)           Without
limiting the remedies available to the Holders, the Issuer acknowledges that
any failure by the Issuer to comply with its obligations under Section 2(a)
and Section 2(b) hereof may result in material irreparable injury
to the Holders for which there is no adequate remedy at law, that it will not
be possible to measure damages for such injuries precisely and that, in the
event of any such failure, any Holder may obtain such relief as may be required
to specifically enforce the Issuer’s obligations under Section 2(a)
and Section 2(b) hereof.

(f)            No
Holder of Registrable Securities may include any of its Registrable Securities
in any Shelf Registration unless and until such Holder furnishes to the Issuer,
in writing within 15 days after receipt of a request therefor, the information
with respect to such Holder specified in Regulation S-K under the 1933 Act and
any other applicable rules, regulations or policies of the SEC for use in
connection with any Shelf Registration or Prospectus included therein, on a
form to be provided by the Issuer.  Each
selling Holder agrees to furnish promptly to the Issuer additional information
to be disclosed so that the information previously furnished to the Issuer by
such Holder does not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading.  No
Holder of Registrable Securities shall be entitled to Additional Interest
pursuant to Section 2(d) hereof unless and until such Holder shall
have provided all such information.

(g)           The
Issuer may delay the filing or the effectiveness of an Exchange Offer
Registration Statement or a Shelf Registration Statement (including any
post-effective amendment thereto) for a period of up to 30 days during any 90
day period if (i) there occur material events or developments with respect to
the Issuer that would need to be described in such Registration Statement or
the related Prospectus, and the effectiveness of such Registration Statement is
reasonably required to be suspended while such Registration Statement and
related Prospectus are amended or supplemented to reflect such events or
developments, (ii)

 10
 

 

 

there occur material events or developments with respect to the Issuer
or any of its Affiliates, the disclosure of which the Issuer determines in good
faith would have a material adverse effect on the business, operations or
prospects of the Issuer, or (iii) the Issuer does not wish to disclose publicly
a pending material business transaction that has not yet been publicly disclosed;
provided, however, that any delay period with respect to Registration
Defaults arising under this Section 2(g) will not alter the obligations
of the Issuer to pay Additional Interest with respect to a Registration Default
subject to the limitations and exceptions set forth in Section 2(d) above.

(h)           Additional
Interest due on the Securities pursuant to Section 2(d) hereof will be
payable in cash semiannually in arrears on the same interest payment dates as
the Securities, commencing with the first interest payment date occurring after
any such Additional Interest commences to accrue.

3.                                       Registration
Procedures.

In connection with the obligations of the Issuer with
respect to the Registration Statements pursuant to Section 2(a) and
Section 2(b) hereof, the Issuer shall:

(a)           prepare and file with the SEC a Registration Statement on
the appropriate form under the 1933 Act, which form (x) shall be selected by
the Issuer and (y) shall, in the case of a Shelf Registration, be available
for the sale of the Registrable Securities by the selling Holders thereof and
(z) shall comply as to form in all material respects with the requirements of
the applicable form and include all financial statements required by the SEC to
be filed therewith, and use its commercially reasonable efforts to cause such
Registration Statement to become effective and remain effective in accordance
with Section 2 hereof;

(b)           prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be necessary to
keep such Registration Statement effective for the applicable period and,
except for such periods as to which such action is not required pursuant to Section
2(g) hereof, cause each Prospectus to be supplemented by any prospectus
supplement required by applicable law and, as so supplemented, to be filed
pursuant to Rule 424 under the 1933 Act; to keep each Prospectus current
during the period described under Section 4(3) and Rule 174 under the 1933 Act
that is applicable to transactions by brokers or dealers with respect to the
Registrable Securities or Exchange Securities;

(c)           in the case of a Shelf Registration, furnish to each
Holder of Registrable Securities, to counsel for the Holders and to each
Underwriter of an Underwritten Offering of Registrable Securities, if any,
without charge, as many copies of each Prospectus,

 11
 

 

 

including each
preliminary Prospectus, and any amendment or supplement thereto and such other
documents as such Holder or Underwriter may reasonably request, in order to
facilitate the public sale or other disposition of the Registrable Securities;
and, except for the periods set forth in Section 2(g) herein, the Issuer
consents to the use of such Prospectus and any amendment or supplement thereto
in accordance with applicable law by each of the selling Holders of Registrable
Securities and any such Underwriters in connection with the offering and sale
of the Registrable Securities covered by and in the manner described in such
Prospectus or any amendment or supplement thereto in accordance with applicable
law;

(d)           use its commercially reasonable efforts to register or
qualify the Registrable Securities under all applicable state securities or “blue
sky” laws of such jurisdictions as any Holder of Registrable Securities covered
by a Registration Statement shall reasonably request in writing by the time the
applicable Registration Statement is declared effective by the SEC, to
cooperate with such Holders in connection with any filings required to be made
with the New York Stock Exchange and the National Association of Securities
Dealers, Inc. and do any and all other acts and things which may be reasonably
necessary or advisable to enable such Holder to consummate the disposition in
each such jurisdiction of such Registrable Securities owned by such Holder; provided,
however, that the Issuer shall not be required to (i) qualify as a
foreign corporation or as a dealer in securities in any jurisdiction where it
would not otherwise be required to qualify but for this Section 3(d),
(ii) file any general consent to service of process or (iii) subject
itself to taxation in any such jurisdiction if it is not so subject;

(e)           in the case of a Shelf Registration, notify each Holder of
Registrable Securities and counsel for the Holders promptly and, if requested
by any such Holder or counsel, confirm such advice in writing (i) when a
Registration Statement has become effective and when any post-effective
amendment thereto has been filed and becomes effective, (ii) of any request by
the SEC or any state securities authority for amendments and supplements to a
Registration Statement and Prospectus or for additional information after the
Registration Statement has become effective, (iii) of the issuance by the SEC
or any state securities authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any proceedings
for that purpose, (iv) if, between the effective date of a Registration
Statement and the closing of any sale of Registrable Securities covered
thereby, the representations and warranties of the Issuer contained in any
underwriting agreement, securities sales agreement or other similar agreement,
if any, relating to the offering cease to be true and correct in all material
respects or if the Issuer receives any notification with respect to the suspension
of the qualification of the Registrable Securities for sale in any jurisdiction
or the initiation of any proceeding for such purpose, (v) of the happening
of any event

 12
 

 

 

during the
period a Shelf Registration Statement is effective which makes any statement
made in such Registration Statement or the related Prospectus untrue in any material
respect or which requires the making of any changes in such Registration Statement
or Prospectus in order to make the statements therein not misleading and (vi)
of any determination by the Issuer that a post-effective amendment to a
Registration Statement  (other than an
amendment that does nothing more substantive than add one or more Holders to
the “Selling Securityholders” table of such Registration Statement or to update
any information set forth in such table) would be appropriate except, in the
case of clauses (iv), (v) and (vi), with respect to any event, development or
transaction permitted to be kept confidential under Section 2(g)
hereof, the Issuer shall not be required to describe such event, development or
transaction in the written notice provided;

(f)            make
commercially reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement as promptly as practicable
and provide reasonably prompt notice to each Holder of the withdrawal of any
such order;

(g)           in
the case of a Shelf Registration, furnish to each Holder of Registrable
Securities, without charge, at least one conformed copy of each Registration
Statement and any post-effective amendment thereto (without documents
incorporated therein by reference or exhibits thereto, unless requested);

(h)           in
the case of a Shelf Registration, cooperate with the selling Holders of
Registrable Securities to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not bearing any
restrictive legends and enable such Registrable Securities to be in such
denominations (consistent with the provisions of the Indenture) and registered
in such names as the selling Holders may reasonably request at least one
business day prior to the closing of any sale of Registrable Securities;

(i)            in
the case of a Shelf Registration, upon the occurrence of any event contemplated
by Section 3(e)(v) hereof, as promptly as practicable prepare and file
with the SEC a supplement or post-effective amendment to a Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities, such Prospectus will not
contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading; the Issuer agrees to notify the
Holders to suspend use of the Prospectus as promptly as practicable after the
occurrence of such an event, and the Holders hereby agree to suspend use of the
Pro-

 13
 

 

 

spectus until the Issuer has amended or
supplemented the Prospectus to correct such misstatement or omission and
expressly agree to maintain the information contained in such notice
confidential (except that such information may be disclosed to its counsel)
until it has been publicly disclosed by the Issuer; notwithstanding the
foregoing, the Issuer shall not be required to amend or supplement a
Registration Statement, any related Prospectus or any document incorporated or
deemed to be incorporated therein by reference if (i) an event occurs and is
continuing as a result of which the Shelf Registration, any related Prospectus
or any document incorporated or deemed to be incorporated therein by reference,
would, in the Issuer’s good faith judgment, contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein not misleading (with respect to such a Prospectus only, in the
light of the circumstances under which they were made), and (ii) (a) the Issuer
determines in its good faith judgment that the disclosure of such event at such
time would have a material adverse effect on the business, operations or
prospects of the Issuer, or (b) the disclosure otherwise relates to a pending
material business transaction that has not yet been publicly disclosed;

(j)            in
the case of a Shelf Registration Statement, a reasonable time prior to the
filing of any Registration Statement, any Prospectus, any amendment to a Registration
Statement or amendment or supplement to a Prospectus, provide copies of such
document to, the Holders and their counsel and make such of the representatives
of the Issuer as shall be reasonably requested by the Holders or their counsel
available for discussion of such document, and shall not at any time file or
make any amendment to the Registration Statement, any Prospectus or any
amendment of or supplement to a Registration Statement or a Prospectus, of
which the Holders and their counsel shall not have previously been advised and
furnished a copy or to which the Holders or their counsel shall reasonably
object on a timely basis, except for any Registration Statement or amendment
thereto or related Prospectus or supplement thereto (a copy of which has been
previously furnished as provided in the preceding sentence) which counsel to
the Issuer has advised the Issuer in writing is required to be filed in order
to comply with applicable law; provided, however, that
the foregoing procedures shall be coordinated on behalf of the Holders by a
representative designated by the majority in aggregate principal amount of the
Holders selling Registrable Securities;

(k)           obtain
a CUSIP number for all Exchange Securities or Registrable Securities, as the
case may be, not later than the effective date of a Registration Statement;

(l)            cause
the Indenture to be qualified under the Trust Indenture Act of 1939, as amended
(the “TIA”), in connection with the registration of the Exchange Securities
or Registrable Securities, as the case may be, cooperate with the Trustee and

 14
 

 

 

the Holders to effect such changes to the
Indenture as may be required for the Indenture to be so qualified in accordance
with the terms of the TIA and execute, and use its commercially reasonable
efforts to cause the Trustee to execute, all documents as may be required to
effect such changes and all other forms and documents required to be filed with
the SEC to enable the Indenture to be so qualified in a timely manner;

(m)          in
the case of an Underwritten Offering pursuant to a Shelf Registration, make
available for inspection upon written request by a representative of the
Holders of the Registrable Securities, any Underwriter participating in any
disposition pursuant to such Shelf Registration Statement, and attorneys and
accountants designated by the Holders, at reasonable times and in a reasonable
manner, all pertinent financial and other records, pertinent documents and
properties of the Issuer as shall be reasonably necessary to enable them to
exercise any applicable due diligence responsibilities, and cause the
respective officers, directors and employees of the Issuer to supply all
information reasonably requested by any such representative, Underwriter,
attorney or accountant in connection with their due diligence responsibilities
under a Shelf Registration Statement; provided that records and
information that the Issuer determines in good faith to be confidential and so
notifies such representative, Underwriter, attorney or accountant are
confidential shall not be disclosed to any such representative, Underwriter,
attorney or accountant unless (i) the disclosure of such information is
necessary to avoid or correct a material misstatement or material omission in
an effective Registration Statement or Prospectus, (ii) the release of
such information is ordered pursuant to a subpoena or other order from a court
of competent jurisdiction or (iii) the information has been made generally
available to the public other than by any of such persons or an Affiliate of
any such persons, provided that if any such information has been
disclosed to any such representative, Underwriter, attorney or accountant,
prior notice shall be provided as soon as practicable to the Issuer of the potential
disclosure of any information by such person under the circumstances described
in clause (i) or (ii) of this sentence in order to permit the Issuer to obtain
a protective order; provided  further, that if such records and
information are determined to be confidential, the Issuer shall
(a) provide  summaries of such information to counsel for such
Underwriter or (b) provide other means as reasonably requested by the Underwriter
to enable such Underwriter to satisfy its due diligence requirements without
compromising the confidentiality of such information;

(n)           if
reasonably requested by any Holder of Registrable Securities covered by a
Registration Statement, (i) subject to Section 2(b) of this
Agreement, promptly incorporate in a Prospectus supplement or post-effective
amendment such information with respect to such Holder as such Holder
reasonably requests to be included therein and (ii) subject to Section 2(b)
of this Agreement, make all required filings of such

 15
 

 

 

Prospectus supplement or such post-effective
amendment as soon as the Issuer has received notification of the matters to be
incorporated in such filing; and

(o)           in
the case of an Underwritten Offering pursuant to a Shelf Registration, enter
into such customary agreements and take all such other actions in connection
therewith (including those requested by the Holders of a majority of the
Registrable Securities being sold) in order to expedite or facilitate the
disposition of such Registrable Securities and in such connection, (i) to the extent
possible, make such representations and warranties to any Underwriters of such
Registrable Securities with respect to the business of the Issuer and its
subsidiaries, the Registration Statement, Prospectus and documents incorporated
by reference or deemed incorporated by reference, if any, in each case, in
form, substance and scope as are customarily made by issuers to underwriters in
underwritten offerings and confirm the same in writing if and when requested,
(ii) obtain opinions of counsel to the Issuer (which counsel and opinions, in
form, scope and substance, shall be reasonably satisfactory to such Underwriters
and their respective counsel) addressed to each Underwriter of Registrable
Securities, covering the matters customarily covered in opinions requested in
underwritten offerings, (iii) obtain “cold comfort” letters from the
independent certified public accountants of the Issuer (and, if necessary, any
other certified public accountant of any subsidiary of the Issuer, or of any
business acquired by the Issuer for which financial statements and financial
data are or are required to be included in the Registration Statement)
addressed to each Underwriter of Registrable Securities, such letters to be in
customary form and covering matters of the type customarily covered in “cold comfort”
letters in connection with underwritten offerings, (iv) if an underwriting agreement
is entered into, include in such underwriting agreement indemnification provisions
and procedures no less favorable to the selling Holders and underwriters, if
any, than those set forth in Section 5 hereof (or such other provisions
and procedures acceptable to Holders of a majority in aggregate principal
amount of Registrable Securities covered by such Registration Statement and the
underwriters (if any), and (v) deliver such documents and certificates as may
be reasonably requested by the Underwriters, and which are customarily
delivered in underwritten offerings, to evidence the continued validity of the
representations and warranties of the Issuer made pursuant to clause (i) above
and to evidence compliance with any customary conditions contained in an
underwriting agreement.

In the case of a
Shelf Registration Statement, the Issuer may require each Holder of Registrable
Securities to furnish to the Issuer such information regarding the Holder and
the proposed distribution by such Holder of such Registrable Securities as the
Issuer may from time to time reasonably request in writing.  The Issuer may exclude from such registration
the Registrable Securities of any seller so long as such seller fails to
furnish such information within a reasonable time after receiving such

 16
 

 

 

request.  Each seller as to which any Shelf
Registration is being effected agrees to furnish promptly to the Issuer all
information required to be disclosed in order to make the information
previously furnished to the Issuer by such seller not materially misleading.

In the case of a
Shelf Registration Statement or if Participating Broker-Dealers who have
notified the Issuer that they will be utilizing the Prospectus contained in the
Exchange Offer Registration Statement as provided in this Section 3(o)
are seeking to sell Exchange Securities and are required to deliver
Prospectuses, each Holder agrees that, upon receipt of any notice from the
Issuer of the happening of any event of the kind described in Section
3(e)(v) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to a Registration Statement until such Holder’s
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(i) hereof, and, if so directed by the Issuer, such Holder will
deliver to the Issuer (at its expense) all copies in its possession, other than
permanent file copies then in such Holder’s possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice.  If the Issuer shall give any
such notice to suspend the disposition of Registrable Securities pursuant to a
Registration Statement, the Issuer shall extend the period during which the
Registration Statement shall be maintained effective pursuant to this Agreement
by the number of days during the period from and including the date of the
giving of such notice to and including the date when the Holders shall have
received copies of the supplemented or amended Prospectus necessary to resume
such dispositions.

The Holders of Registrable Securities covered by a
Shelf Registration Statement who desire to do so may sell such Registrable Securities
in an Underwritten Offering.  In any such
Underwritten Offering, the investment banker or investment bankers and manager
or managers (the “Underwriters”) that will administer the offering will
be selected by the Majority Holders of the Registrable Securities included in
such offering.

4.                                      Participation
of Broker-Dealers in Exchange Offer.

(a)           The
Staff of the SEC has taken the position that any broker-dealer that receives
Exchange Securities for its own account in the Exchange Offer in exchange for Securities
that were acquired by such broker-dealer as a result of market-making or other
trading activities (a “Participating Broker-Dealer”), may be deemed to
be an “underwriter” within the meaning of the 1933 Act and must deliver a
prospectus meeting the requirements of the 1933 Act in connection with any
resale of such Exchange Securities.

The Issuer understands that it is the Staff’s position
that if the Prospectus contained in the Exchange Offer Registration Statement
includes a plan of distribution containing a statement to the above effect and
the means by which Participating Broker-Dealers may resell

 17
 

 

 

the Exchange Securities, without naming the
Participating Broker-Dealers or specifying the amount of Exchange Securities
owned by them, such Prospectus may be delivered by Participating Broker-Dealers
to satisfy their prospectus delivery obligation under the 1933 Act in
connection with resales of Exchange Securities for their own accounts, so long
as the Prospectus otherwise meets the requirements of the 1933 Act.

(b)           In
light of the above, notwithstanding the other provisions of this Agreement, the
Issuer agrees that the provisions of this Agreement as they relate to a Shelf
Registration shall also apply to an Exchange Offer Registration to the extent,
and with such reasonable modifications thereto as may be, reasonably requested
by one or more Participating Broker-Dealers as provided in clause (ii)
below, in order to expedite or facilitate the disposition of any Exchange
Securities by Participating Broker-Dealers consistent with the positions of the
Staff recited in Section 4(a) above; provided that:

(i)      the Issuer shall not be required to keep
the Exchange Offer Registration Statement effective, as would otherwise be
contemplated by Section 2(b) for a period exceeding 90 days after the
date on which such Exchange Offer Registration Statement is declared effective
(as such period may be extended pursuant to the penultimate paragraph of Section 3
of this Agreement as applied to such Exchange Offer Registration Statement);

(ii)     the Issuer shall not be required to amend
or supplement the Prospectus contained in the Exchange Offer Registration
Statement, as would otherwise be contemplated by Section 3(i), for a
period exceeding 90 days after the date on which such Exchange Offer
Registration Statement is declared effective (as such period may be extended
pursuant to the penultimate paragraph of Section 3 of this
Agreement as applied to such Exchange Offer Registration Statement) and
Participating Broker-Dealers shall not be authorized by the Issuer to deliver
and shall not deliver such Prospectus after such period in connection with the
resales contemplated by this Section 4; and

(iii)    the application of the Shelf Registration
procedures set forth in Section 3 of this Agreement to an Exchange Offer
Registration, to the extent not required by the positions of the Staff of the
SEC or the 1933 Act and the rules and regulations thereunder, will be in
conformity with the reasonable request in writing to the Issuer by one or more
broker-dealers who certify to the Issuer in writing that they anticipate that
they will be Participating Broker-Dealers; and provided, further,
that, in connection with such application of the Shelf Registration procedures
set forth in Section 3 to an Exchange Offer Registration, the
Issuer shall be obligated (x) to deal only with the Broker-Dealer
Representatives and (y) to pay the fees and expenses of only one counsel
representing the Participating Broker-Dealers.

 18

 

 

5.                                      Indemnification
and Contribution.

(a)           The
Issuer hereby agrees to indemnify and hold harmless each Holder of Registrable
Securities and each Participating Broker-Dealer selling Exchange Securities
during the applicable period, and each Person, if any, who controls such Person
or its affiliates within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act (each, a “Participant”) from and against any
and all losses, claims, damages, liabilities or expenses (whether direct or
indirect, in contract, tort or otherwise) whatsoever, as incurred (including
the cost of any investigation or preparation) arising out of or based upon:

(i)      any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement (or any
amendment thereto) or Prospectus (as amended or supplemented if the Issuer
shall have furnished any amendments or supplements thereto) or any preliminary
prospectus; or

(ii)     the omission or alleged omission to state,
in any Registration Statement (or any amendment thereto) or Prospectus (as
amended or supplemented if the Issuer shall have furnished any amendments or
supplements thereto) or any preliminary prospectus or any other document or any
amendment or supplement thereto, a material fact necessary to make the
statements made therein, in the light of the circumstances under which they
were made, not misleading;

provided, however, the Issuer
will not be liable in any such case to the extent that any such loss, claim,
damage, liability or expense arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
any Registration Statement (or any amendment thereto) or Prospectus (as amended
or supplemented if the Issuer shall have furnished any amendments or
supplements thereto) or any preliminary prospectus or any amendment or
supplement thereto of a material fact necessary in order to make the statements
made therein, in the light of the circumstances under with they were made, not
misleading, if in any case such statement or omission relates to such
Participant and was made in reliance upon and in conformity with information
furnished in writing to the Issuer by such Participant expressly for use
therein.  The indemnity provided for in
this Section 5 will be in addition to any liability that the Issuer may
otherwise have to the indemnified parties. 
The Issuer shall not be liable under this Section 5 for any
settlement of any claim or action effected without its prior written consent,
which shall not be unreasonably withheld. 
No Participant shall, without the prior written consent of the Issuer,
effect any settlement or compromise of any pending or threatened proceeding in
respect of which such Issuer is or could have been a party, or indemnity could have
been sought hereunder by such Issuer, unless such settlement (A) includes
an unconditional release of such Issuer, from all liability in any way related
to or arising out of such litigation or proceeding and (B) does not impose
any actual or potential liability or any other obligation upon any Issuer and
does not contain any factual or legal admission of fault, culpability or a
failure to act by or with respect to any Issuer.

 19
 

 

 

Each Participant, severally and not jointly, agrees to
hold the Issuer harmless and to indemnify the Issuer (including any of its
respective affiliated companies and any director, officer, agent or employee of
the Issuer or any such affiliated company) and any director, officer, or other
person controlling (within the meaning of Section 15 of the 1933 Act or
Section 20(a) of the 1934 Act) the Issuer (including any of the Issuer’s
affiliated companies) from and against any and all losses, claims, damages, liabilities
or expenses (whether direct or indirect, in contract, tort or otherwise)
whatsoever, as incurred (including the cost of any investigation and
preparation) arising out of or based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus, any amendment or supplement thereto, or any
preliminary prospectus, or (ii) the omission or the alleged omission to
state therein a material fact necessary to make the statements made therein, in
light of the circumstances under which they were made, not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission relates to such
Participant and was made in reliance upon and in conformity with information
furnished in writing by such Participant, expressly for use therein.  The indemnity provided for in this
Section 5 will be in addition to any liability that the Participants may
otherwise have to the indemnified parties. 
The Participants shall not be liable under this Section 5 for any
settlement of any claim or action effected without their consent, which shall
not be unreasonably withheld.  The Issuer
shall not, without the prior written consent of such Participant, effect any
settlement or compromise of any pending or threatened proceeding in respect of
which such Participant is or could have been a party, or indemnity could have
been sought hereunder by such Participant, unless such settlement
(A) includes an unconditional release of such Participant, from all
liability in any way related to or arising out of such litigation or proceeding
and (B) does not impose any actual or potential liability or any other
obligation upon any such Participant and does not contain any factual or legal
admission of fault, culpability or a failure to act by or with respect to any
such Participant.

If a claim is made against any indemnified party as to
which such indemnified party may seek indemnity under this Section 5, such
indemnified person shall notify the indemnifying party promptly after any
written assertion of such claim threatening to institute an action or
proceeding with respect thereto and shall notify the indemnifying party
promptly of any action commenced against such indemnified party within a
reasonable time after such indemnified party shall have been served with a
summons or other first legal process giving information as to the nature and
basis of the claim.  Failure to so notify
the indemnifying party shall not, however, relieve the indemnifying party from
any liability which it may have on account of the indemnity under this
Section 5, except to the extent such failure results in the forfeiture by
the indemnifying party of material rights and defenses. The indemnifying party
shall have the right to assume the defense of any such litigation or
proceeding, including the engagement of counsel reasonably satisfactory to the
indemnified party.  In any such
litigation or proceeding the defense of which the indemnifying party shall have
so assumed, any indemnified party shall have the right to participate in such
litigation or proceeding and to retain its

 20
 

 

 

own counsel, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the indemnifying
party shall have failed promptly to assume the defense thereof and employ
counsel as provided above, or (ii) counsel to the indemnified party
reasonably determines that representation of such indemnified party by the
indemnifying party’s counsel would present the indemnifying party’s counsel
with a conflict of interest.  It is
understood that the indemnifying party shall not, in connection with any
litigation or proceeding or related litigation or proceeding in the same
jurisdiction, be liable under this Agreement for the fees and expenses of more
than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred.  Such separate firm
shall be designated by the indemnified party.

To the extent the indemnity provided for in the
foregoing paragraphs of this Section 5 is for any reason held unenforceable
although otherwise applicable in accordance with its terms with respect to an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then the indemnifying party agrees to contribute
to the amount paid or payable by such indemnified person as a result of such
losses, claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying
party, on the one hand, and by such indemnified party, on the other, from the
offering of the Securities or (ii) if the allocation provided by the foregoing
clause (i) is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in the foregoing clause
(i), but also the relative fault of the indemnifying party, on the one hand,
and of such indemnified party, on the other, in connection with the statements,
actions or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations.  The relative benefits
received by the Issuer, on the one hand, and by such Participant, on the other,
shall be deemed in the same proportion as the total proceeds from the offering
(before deducting expenses) of the Securities received by the Issuer bear to
the total net profit received by such Participant in connection with the sale
of the Securities. Relative fault shall be determined by reference to, among
other things, whether any alleged untrue statement or omission or any other
alleged conduct relates to information provided by the Issuer or other conduct
by the Issuer (or its employees or other agents), on the one hand, or by such
Participants, on the other hand.

The parties agree that it would not be equitable if
the amount of such contribution were determined by pro rata or per capita
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the first sentence of the previous
paragraph.  Notwithstanding any other
provision of the previous paragraph, no Participant shall be obligated to make
contributions hereunder that in the aggregate exceed the total net profit
received by such Participant in connection with the sale of the Securities,
less the aggregate amount of any damages that such Participant has otherwise
been required to pay by reason of the untrue or alleged untrue statements or
the omissions or alleged omissions to state a material fact, and no person
guilty of fraudulent misrepresentation (within the meaning

 21
 

 

 

of Section 11(f) of 1933 Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation.  For purposes of this
paragraph (d), each person, if any, who controls a Participant within the
meaning of Section 15 of 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Participants, and each director of
any Issuer, each officer of any Issuer and each person, if any, who controls
any Issuer within the meaning of Section 15 of 1933 Act or Section 20
of the 1934 Act, shall have the same rights to contribution as the Issuer.

6.                                      Miscellaneous.

(a)           No
Inconsistent Agreements.  The Issuer
has not entered into, and on or after the date of this Agreement will not enter
into, any agreement which is inconsistent with the rights granted to the
Holders of Registrable Securities in this Agreement or otherwise conflicts with
the provisions hereof.  The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Issuer’s other
issued and outstanding securities under any such agreements.

(b)           Amendments
and Waivers.  The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless the Issuer has obtained the written
consent of Holders of at least a majority in aggregate principal amount of the
outstanding Registrable Securities affected by such amendment, modification,
supplement, waiver or consent; provided, however, that no
amendment, modification, supplement, waiver or consent to any departure from
the provisions of Section 5 hereof shall be effective as against any
Holder of Registrable Securities unless consented to in writing by such
Holder.  Notwithstanding the foregoing
sentence, (i) a waiver or consent to depart from the provisions hereof
with respect to a matter that relates exclusively to the rights of Holders of
Registrable Securities whose securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect, impair,
limit or compromise the rights of other Holders of Registrable Securities may
be given by Holders of at least a majority in aggregate principal amount of
Registrable Securities being sold pursuant to such Registration Statement,
(ii) this Agreement may be amended, without the consent of any Holder of
Registrable Securities, by written agreement signed by the Issuer and the
Initial Purchasers, to cure any ambiguity, correct or supplement any provision
of this Agreement that may be inconsistent with any other provision of this
Agreement or to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be inconsistent with other
provisions of this Agreement, (iii) this Agreement may be amended,
modified or supplemented, and waivers and consents to departures from the
provisions hereof may be given, by written agreement signed by the Issuer and
the Initial Purchasers to the extent that any such amendment, modification,
supplement, waiver or consent is, in their reasonable judgment, necessary or
appropriate to comply with applicable law (including any interpretation of the
Staff of the SEC) or any change therein and (iv) to the extent any
provision of this Agreement relates to

 22
 

 

 

an Initial Purchaser, such provision may be amended, modified or supplemented,
and waivers or consents to departures from such provisions may be given, by
written agreement signed by such Initial Purchaser and the Issuer.

(c)           Notices.  All notices and other communications provided
for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telex, telecopier, or any courier guaranteeing
overnight delivery (i) if to a Holder, at the most current address given by
such Holder to the Issuers by means of a notice given in accordance with the
provisions of this Section 6(c); (ii) if to the Issuer, initially at the
Issuer’s address set forth in the Indenture and thereafter at such other
address, notice of which is given in accordance with the provisions of this Section
6(c); and (iii) if to the Trustee, initially at the Trustee’s address set
forth in the Indenture and thereafter at such other address, notice of which is
given in accordance with the provisions of this Section 6(c).

All such notices and communications shall be deemed to
have been duly given:  at the time
delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt is acknowledged, if telecopied; and on the next business
day if timely delivered to an air courier guaranteeing overnight delivery.

Copies of all such notices, demands, or other
communications shall be concurrently delivered by the Person giving the same to
the Trustee, at the address specified in the Indenture.

(d)           Successors
and Assigns.  This Agreement shall
inure to the benefit of and be binding upon the successors, assigns and
transferees of each of the parties, including, without limitation and without
the need for an express assignment, subsequent Holders; provided that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Securities in violation of the terms of the
Indenture.  If any transferee of any
Holder shall acquire Registrable Securities, in any manner, whether by
operation of law or otherwise, such Registrable Securities shall be held
subject to all of the terms of this Agreement, and by taking and holding such
Registrable Securities such Person shall be conclusively deemed to have agreed
to be bound by and to perform all of the terms and provisions of this Agreement
and such Person shall be entitled to receive the benefits hereof.  The Trustee (in its capacity as Trustee under
the Indenture or acting on behalf of the Holders pursuant to this Agreement)
shall have no liability or obligation to either (i) the Issuer with respect to
any failure by a Holder to comply with, or any breach by any Holder of, any of
the obligations of such Holder under this Agreement or (ii) any Holder with
respect to any failure by the Issuer to comply with, or any breach by the
Issuer of, any of the obligations of the Issuer under this Agreement.

 23
 

 

 

(e)           Entire
Agreement. This Agreement contains the entire agreement among the parties
hereto with respect to the subject matter hereof and supersedes and replaces
all other prior agreements, written or oral, among the parties hereto with
respect to the subject matter hereof.

(f)            Third
Party Beneficiary.  The Holders shall
be third party beneficiaries to the agreements made hereunder between the
Issuer, on the one hand, and the Initial Purchasers, on the other hand, and
shall have the right to enforce such agreements directly to the extent it deems
such enforcement necessary or advisable to protect its rights or the rights of
Holders hereunder.

(g)           Counterparts.  This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

(h)           Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.

(i)            Governing
Law.  The internal laws of the State
of New York shall govern the enforceability and validity of this Agreement, the
construction of its terms and the interpretation of the rights and duties of
the parties hereto without giving effect to conflicts of laws, rules or principles.

(j)            Severability.  In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.

 24
 

 

 

IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.

	
  

  	
  QWEST CORPORATION

  
	
   

  	
  By:

  	
  /s/ Janet K. Cooper

  
	
   

  	
   

  	
  Name:

  	
   Janet K.
  Cooper

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President — Finance and Treasurer

  

 

 25
 

 

 

	
  

  	
  DEUTSCHE BANK
  SECURITIES INC.

  
	
   

  	
  CREDIT SUISSE
  SECURITIES (USA) LLC

  
	
   

  	
  MERRILL LYNCH,
  PIERCE, FENNER &

  
	
   

  	
  SMITH INCORPORATED,

  
	
   

  	
  As
  Representatives of the Initial Purchasers

  
	
   

  	
  By:

  	
  DEUTSCHE BANK
  SECURITIES INC.

  
	
   

  	
  By:

  	
  /s/ Matthew Maley

  
	
   

  	
   

  	
  Name: 

  	
  Matthew Maley

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
  By:

  	
  /s/ David Crescenzi

  
	
   

  	
   

  	
  Name: 

  	
  David Crescenzi

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
  By:

  	
  CREDIT SUISSE
  SECURITIES (USA) LLC

  
	
   

  	
  By:

  	
  /s/ William L. Raincsuk

  
	
   

  	
   

  	
  Name: 

  	
  William L.
  Raincsuk

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
  By:

  	
  MERRILL LYNCH, PIERCE,
  FENNER &

  
	
   

  	
   

  	
  SMITH
  INCORPORATED

  
	
   

  	
  By:

  	
  /s/ Tami Kidd

  
	
   

  	
   

  	
  Name: 

  	
  Tami Kidd

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

 26

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