Document:

Exhibit 4.05

 

 

 

GUARANTEE AGREEMENT

 

Lehman Brothers Holdings Capital Trust V

 

Dated as of April 22, 2004

 

 

 

 

CROSS REFERENCE TABLE*

 

	
  Section of Trust

  Indenture Act of

  1939, as amended

  	
   

  	
  Section of

  Guarantee

  Agreement

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  310(a)

  	
   

  	
  4.1(a)

  	
   

  
	
  310(b)

  	
   

  	
  2.8; 4.1(c)

  	
   

  
	
  310(c)

  	
   

  	
  Inapplicable

  	
   

  
	
  311(a)

  	
   

  	
  2.2(b)

  	
   

  
	
  311(b)

  	
   

  	
  2.2(b)

  	
   

  
	
  311(c)

  	
   

  	
  Inapplicable

  	
   

  
	
  312(a)

  	
   

  	
  2.2(a); 2.9

  	
   

  
	
  312(b)

  	
   

  	
  2.2(b); 2.9

  	
   

  
	
  312(c)

  	
   

  	
  2.9

  	
   

  
	
  313(a)

  	
   

  	
  2.3

  	
   

  
	
  313(b)

  	
   

  	
  2.3

  	
   

  
	
  313(c)

  	
   

  	
  2.3

  	
   

  
	
  313(d)

  	
   

  	
  2.3

  	
   

  
	
  314(a)

  	
   

  	
  2.4

  	
   

  
	
  314(b)

  	
   

  	
  Inapplicable

  	
   

  
	
  314(c)

  	
   

  	
  2.5

  	
   

  
	
  314(d)

  	
   

  	
  Inapplicable

  	
   

  
	
  314(e)

  	
   

  	
  2.5

  	
   

  
	
  314(f)

  	
   

  	
  Inapplicable

  	
   

  
	
  315(a)

  	
   

  	
  3.1(d); 3.2(a)

  	
   

  
	
  315(b)

  	
   

  	
  2.7(a)

  	
   

  
	
  315(c)

  	
   

  	
  3.1(c)

  	
   

  
	
  315(d)

  	
   

  	
  3.1(d)

  	
   

  
	
  316(a)

  	
   

  	
  2.6; 5.4(a)

  	
   

  
	
  316(b)

  	
   

  	
  5.3

  	
   

  
	
  316(c)

  	
   

  	
  Inapplicable

  	
   

  
	
  317(a)

  	
   

  	
  2.10

  	
   

  
	
  317(b)

  	
   

  	
  Inapplicable

  	
   

  
	
  318(a)

  	
   

  	
  2.1(b)

  	
   

  

 

 

*                                         This
Cross-Reference Table does not constitute part of the Agreement and shall not
have any bearing upon the interpretation of any of its terms or provisions.

 

i

 

TABLE OF CONTENTS

 

 

	
  SECTION 1
  INTERPRETATION AND DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1.

  	
  Interpretation and
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2
  TRUST INDENTURE ACT 5

  	
   

  
	
   

  	
   

  	
   

  
	
  2.1.

  	
  Trust
  Indenture Act; Application

  	
   

  
	
   

  	
   

  	
   

  
	
  2.2.

  	
  Lists
  of Holders of Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  2.3.

  	
  Reports
  by Guarantee Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  2.4.

  	
  Periodic
  Reports to Guarantee Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  2.5.

  	
  Evidence
  of Compliance with Conditions Precedent

  	
   

  
	
   

  	
   

  	
   

  
	
  2.6.

  	
  Guarantee
  Event of Default; Waiver

  	
   

  
	
   

  	
   

  	
   

  
	
  2.7.

  	
  Guarantee
  Event of Default; Notice

  	
   

  
	
   

  	
   

  	
   

  
	
  2.8.

  	
  Conflicting
  Interests

  	
   

  
	
   

  	
   

  	
   

  
	
  2.9.

  	
  Disclosure
  of Information

  	
   

  
	
   

  	
   

  	
   

  
	
  2.10.

  	
  Guarantee
  Trustee May File Proofs of Claim

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3
  POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  3.1.

  	
  Powers
  and Duties of Guarantee Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  3.2.

  	
  Certain
  Rights of Guarantee Trustee.

  	
   

  
	
   

  	
   

  	
   

  
	
  3.3.

  	
  Not
  Responsible for Recitals or Issuance of Guarantee

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4
  GUARANTEE TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  4.1.

  	
  Guarantee
  Trustee; Eligibility

  	
   

  
	
   

  	
   

  	
   

  
	
  4.2.

  	
  Appointment,
  Removal and Resignation of Guarantee Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5
  GUARANTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1.

  	
  Guarantee

  	
   

  
	
   

  	
   

  	
   

  
	
  5.2.

  	
  Waiver of Notice and
  Demand

  	
   

  

 

ii

 

	
  5.3.

  	
  Obligations Not
  Affected

  	
   

  
	
   

  	
   

  	
   

  
	
  5.4.

  	
  Rights of Holders

  	
   

  
	
   

  	
   

  	
   

  
	
  5.5.

  	
  Guarantee of Payment

  	
   

  
	
   

  	
   

  	
   

  
	
  5.6.

  	
  Subrogation

  	
   

  
	
   

  	
   

  	
   

  
	
  5.7.

  	
  Independent Obligations

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6
  LIMITATION OF TRANSACTIONS; SUBORDINATION 15

  	
   

  
	
   

  	
   

  	
   

  
	
  6.1.

  	
  Limitation of Transactions

  	
   

  
	
   

  	
   

  	
   

  
	
  6.2.

  	
  Ranking

  	
   

  
	
   

  	
   

  	
   

  
	
  6.3.

  	
  Subordination of
  Common Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 7
  TERMINATION 16

  	
   

  
	
   

  	
   

  	
   

  
	
  7.1.

  	
  Termination

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 8
  INDEMNIFICATION

  	
   

  
	
   

  	
   

  	
   

  
	
  8.1.

  	
  Exculpation

  	
   

  
	
   

  	
   

  	
   

  
	
  8.2.

  	
  Indemnification

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9 MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  9.1.

  	
  Successors and Assigns

  	
   

  
	
   

  	
   

  	
   

  
	
  9.2.

  	
  Amendments

  	
   

  
	
   

  	
   

  	
   

  
	
  9.3.

  	
  Notices

  	
   

  
	
   

  	
   

  	
   

  
	
  9.4.

  	
  Benefit

  	
   

  
	
   

  	
   

  	
   

  
	
  9.5.

  	
  Governing Law

  	
   

  

 

iii

 

GUARANTEE
AGREEMENT

 

This
GUARANTEE AGREEMENT (the “Guarantee”), dated as of April 22, 2004, is
executed and delivered by Lehman Brothers Holdings Inc., a Delaware corporation
(the “Guarantor”), and JPMorgan Chase Bank, as trustee (the “Guarantee
Trustee”), for the benefit of the Holders (as defined herein) from time to time
of the Securities (as defined herein) of Lehman Brothers Holdings Capital Trust
V, a Delaware statutory trust (the “Trust”).

 

W  I  T  N
E  S  S  E  T  H :

 

WHEREAS, pursuant to the Declaration (as defined herein), the Trust may
initially issue an unlimited amount of preferred securities, having a
liquidation amount of $25 per security and designated the 6.00% Preferred
Securities of the Trust, Series M (the “Preferred Securities”), and common
securities, having a liquidation amount of $25 per security and designated the
6.00% Common Securities of the Trust (the “Common Securities” and, together
with the Preferred Securities, the “Securities”);

 

WHEREAS, as incentive for the Holders to purchase the Securities, the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth in this Guarantee, to pay to the Holders of the Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms
and conditions set forth herein; and that if a Trust Enforcement Event (as
defined herein) has occurred and is continuing, the rights of holders of the
Common Securities to receive Guarantee Payments under this Guarantee are
subordinated to the rights of Holders of Preferred Securities to receive
Guarantee Payments under this Guarantee.

 

NOW, THEREFORE, in consideration of the purchase by each Holder of
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee for the benefit
of the Holders.

 

SECTION 1

INTERPRETATION
AND DEFINITIONS

 

1.1.                              Interpretation and Definitions.   In this Guarantee, unless the context
otherwise requires:

 

(a)                                  capitalized
terms used in this Guarantee but not defined in the preamble above have the
respective meanings assigned to them in this Section 1.1;

 

(b)                                 a term defined
anywhere in this Guarantee has the same meaning throughout;

 

(c)                                  all references
to “the Guarantee” or “this Guarantee” are to this Guarantee as modified,
supplemented or amended from time to time;

 

 

(d)                                 all references
in this Guarantee to Articles, Sections and Recitals are to Articles, Sections
and Recitals of this Guarantee, unless otherwise specified;

 

(e)                                  unless
otherwise defined in this Guarantee, a term defined in the Trust Indenture Act
has the same meaning when used in this Guarantee;

 

(f)                                    a reference to
the singular includes the plural and vice versa and a reference to any
masculine form of a term shall include the feminine form of a term, as
applicable; and

 

(g)                                 the following
terms have the following meanings:

 

“Affiliate”
has the same meaning as given to that term in Rule 405 of the Securities Act of
1933, as amended, or any successor rule thereunder.

 

“Business
Day” has the meaning specified in the Declaration.

 

“Common
Securities” has the meaning specified in the Recitals hereto.

 

“Corporate
Trust Office” means the principal office of the Guarantee Trustee at which at
any particular time its corporate trust business shall be administered, which
office at the date of execution of this Guarantee is located at 4 New York
Plaza, 15th Floor, New York, New York 10004.

 

“Covered
Person” means a Holder or beneficial owner of Securities.

 

“Debentures”
means the series of subordinated deferrable interest debentures to be issued by
the Guarantor designated the 6.00% Subordinated Deferrable Interest Debentures
due 2053 held by the Property Trustee (as defined in the Declaration) of the
Trust.

 

“Declaration”
means the Amended and Restated Declaration of Trust, dated as of April 22,
2004, as amended, modified or supplemented from time to time, among the
trustees of the Trust named therein, the Guarantor, as sponsor, and the
Holders, from time to time, of undivided beneficial ownership interests in the
assets of the Trust.

 

“Global
Security” means a fully registered, global Preferred Security.

 

“Guarantee
Event of Default” means a default by the Guarantor on any of its payment or
other obligations under this Guarantee.

 

“Guarantee
Payments” means the following payments or distributions, without duplication,
with respect to the Securities, to the extent not paid by or on behalf of the
Trust:  (i) any accumulated and
unpaid Distributions (as defined in the Declaration) that are required to be
paid on such Securities to the extent the Trust has sufficient funds available
therefor at the time, (ii) the redemption price, including all accumulated and
unpaid Distributions to the date of redemption, with respect to any Securities
called for redemption by the Trust, to the extent the Trust shall have
sufficient funds available therefor at the time or (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Trust (other than in
connection with the

 

2

 

distribution of Debentures to the Holders in exchange for Securities as
provided in the Declaration), the lesser of (a) the aggregate of the
liquidation amount and all accumulated and unpaid Distributions on the
Securities to the date of payment, to the extent the Trust has sufficient funds
available therefor and (b) the amount of assets of the Trust remaining
available for distribution to Holders in liquidation of the Trust (in either
case, the “Liquidation Distribution”).

 

“Guarantee
Trustee” means JPMorgan Chase Bank, until a Successor Guarantee Trustee has
been appointed and has accepted such appointment pursuant to the terms of this
Guarantee and thereafter means each such Successor Guarantee Trustee.

 

“Holder”
means any holder of Securities, as registered on the books and records of the
Trust; provided, however, that, in determining whether the Holders of the
requisite percentage of Preferred Securities have given any request, notice,
consent or waiver hereunder, “Holder” shall not include the Guarantor or any
Affiliate of the Guarantor or any other obligor on the Preferred Securities;
and provided further, that in determining whether the Holders of the requisite
liquidation amount of Preferred Securities have voted on any matter provided
for in this Guarantee, then for the purpose of such determination only (and not
for any other purpose hereunder), if the Preferred Securities remain in the
form of one or more Global Certificates (as defined in the Declaration), the
term “Holders” shall mean the holder of the Global Certificate acting at the
direction of the Beneficial Owners (as defined in the Declaration).

 

“Indemnified
Person” means the Guarantee Trustee, any Affiliate of the Guarantee Trustee, or
any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Guarantee Trustee.

 

“Indenture”
means the Indenture, dated as of February 1, 1996, between the Guarantor
and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank and prior
thereto as Chemical Bank), as trustee, as amended and supplemented by the First
Supplemental Indenture dated as of February 1, 1996, and by any other
indenture supplemental thereto pursuant to which the Debentures are to be
issued to the Property Trustee (as defined in the Declaration) of the Trust.

 

“Majority
in Liquidation Amount” means, except as provided in the terms of the Preferred
Securities or by the Trust Indenture Act, Holder(s) of outstanding Securities,
voting together as a single class, or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common Securities,
voting separately as a class, who are the record owners of more than 50% of the
aggregate liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all
outstanding Securities of the relevant class. 
In determining whether the Holders of the requisite amount of Securities
have voted, Securities which are owned by the Guarantor or any Affiliate of the
Guarantor or any other obligor on the Securities shall be disregarded for the
purpose of any such determination.

 

“Officers’
Certificate” means, with respect to any Person, a certificate signed on behalf
of such Person by two Authorized Officers (as defined in the Declaration) of
such Person.

 

3

 

Any Officers’ Certificate delivered with respect to compliance with a
condition or covenant provided for in this Guarantee shall include:

 

(a)                                  a statement that each
officer signing the Officers’ Certificate has read the covenant or condition
and the definitions relating thereto;

 

(b)                                 a brief statement of
the nature and scope of the examination or investigation undertaken by each
officer on behalf of such Person in rendering the Officers’ Certificate;

 

(c)                                  a statement that each
such officer has made such examination or investigation as, in such officer’s
opinion, is necessary to enable such officer on behalf of such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and

 

(d)                                 a statement as to
whether, in the opinion of each such officer acting on behalf of such Person,
such condition or covenant has been complied with.

 

“Person”
means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association, or government or any agency or
political subdivision thereof, or any other entity of whatever nature.

 

“Preferred
Securities” has the meaning specified in the Recitals hereto.

 

“Redemption
Price” has the meaning specified in the Declaration.

 

“Responsible
Officer” means, with respect to the Guarantee Trustee, any officer with direct
responsibility for the administration of this Guarantee and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer’s knowledge of and familiarity with
the particular subject.

 

“Securities”
has the meaning specified in the Recitals hereto.

 

“Successor
Guarantee Trustee” means a successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.1.

 

“Trust
Enforcement Event” in respect of the Securities means an Indenture Event of
Default (as defined in the Indenture) has occurred and is continuing in respect
of the Debentures.

 

“Trust
Indenture Act” means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.

 

4

 

SECTION 2

TRUST
INDENTURE ACT

 

2.1.                              Trust Indenture Act; Application.  (a) 
This Guarantee is subject to the provisions of the Trust Indenture Act
that are required to be part of this Guarantee and shall, to the extent
applicable, be governed by such provisions.

 

(b)                                 If and to the
extent that any provision of this Guarantee limits, qualifies or conflicts with
the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture
Act, such imposed duties shall control.

 

2.2.                              Lists
of Holders of Securities.  
(a)  The Guarantor shall provide
the Guarantee Trustee (i) except while the Preferred Securities are represented
by one or more Global Securities at least one Business Day prior to the date
for payment of Distributions, a list, in such form as the Guarantee Trustee may
reasonably require, of the names and addresses of the Holders of the Securities
(“List of Holders”) as of the record date relating to  the payment of such Distributions, and (ii) at any other time,
within 30 days of receipt by the Guarantor of a written request from the
Guarantee Trustee for a List of Holders as of a date no more than 15 days
before such List of Holders is given to the Guarantee Trustee; provided that
the Guarantor shall not be obligated to provide such List of Holders at any
time the List of Holders does not differ from the most recent List of Holders
given to the Guarantee Trustee by the Guarantor.  The Guarantee Trustee shall preserve, in as current a form as is
reasonably practicable, all information contained in Lists of Holders given to
it, provided that the Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.

 

(b)                                 The Guarantee
Trustee shall comply with its obligations under Sections 311(a), 311(b) and
312(b) of the Trust Indenture Act.

 

2.3.                              Reports
by Guarantee Trustee. 
Within 60 days after May 15 of each year (commencing with the year of
the first anniversary of the issuance of the Securities), the Guarantee Trustee
shall provide to the Holders of the Securities such reports as are required by
Section 313 of the Trust Indenture Act (if any) in the form and in the
manner provided by Section 313 of the Trust Indenture Act.  The Guarantee Trustee shall also comply with
the requirements of Section 313(d) of the Trust Indenture Act.

 

2.4.                              Periodic Reports to Guarantee Trustee.  The Guarantor shall provide to the Guarantee
Trustee such documents, reports and information as required by
Section 314(a) (if any) of the Trust Indenture Act and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314(a) of the
Trust Indenture Act.

 

2.5.                              Evidence
of Compliance with Conditions Precedent.  The Guarantor shall provide to the Guarantee
Trustee such evidence of compliance with any conditions precedent, if any,
provided for in this Guarantee that relate to any of the matters set forth in
Section 314(c) of the Trust Indenture Act.  Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) may be given in the form of an Officers’
Certificate.

 

5

 

2.6.                              Guarantee
Event of Default; Waiver. 
The Holders of a Majority in Liquidation Amount of the Securities may,
by vote or written consent, on behalf of the Holders of all of the Securities,
waive any past Guarantee Event of Default and its consequences.  Upon such waiver, any such Guarantee Event
of Default shall cease to exist, and any Guarantee Event of Default arising therefrom
shall be deemed to have been cured, for every purpose of this Guarantee, but no
such waiver shall extend to any subsequent or other default or Guarantee Event
of Default or impair any right consequent thereon.

 

2.7.                              Guarantee
Event of Default; Notice. 
(a)  The Guarantee Trustee shall,
within 90 days after the occurrence of a Guarantee Event of Default, transmit
by mail, first class postage prepaid, to the Holders of the Securities, notices
of all Guarantee Events of Default actually known to a Responsible Officer of
the Guarantee Trustee, unless such defaults have been cured before the giving
of such notice; provided, that the Guarantee Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders of the Securities.

 

(b)                                 The Guarantee
Trustee shall not be deemed to have knowledge of any Guarantee Event of Default
unless the Guarantee Trustee shall have received written notice thereof or a Responsible
Officer of the Guarantee Trustee charged with the administration of the
Declaration shall have obtained actual knowledge thereof.

 

2.8.                              Conflicting
Interests.  The
Declaration shall be deemed to be specifically described in this Guarantee for
the purposes of clause (i) of the first proviso contained in
Section 310(b)(1) of the Trust Indenture Act.  Nothing herein shall prevent the Trustee from filing with the
Commission the application referred to in the penultimate paragraph of
Section 310(b) of the Trust Indenture Act.  In determining whether the Trustee has a conflicting interest as
defined in Section 310(b) of the Trust Indenture Act with respect to the
Securities or the Guarantees in respect of such Securities, there shall be
excluded (i) all series of securities issued or issuable under the Indenture,
(ii) (A) the Guarantee Agreement, dated as of January 26, 1999, executed
and delivered by Lehman Brothers Holdings Inc. and The Chase Manhattan Bank for
the benefit of the holders identified therein of Lehman Brothers Holdings
Capital Trust I, (B) the Guarantee Agreement, dated as of April 20, 1999,
executed and delivered by Lehman Brothers Holdings Inc. and The Chase Manhattan
Bank for the benefit of the holders identified therein of Lehman Brothers
Holdings Capital Trust II, (C) the Guarantee Agreement, dated as of
March 17, 2003, executed and delivered by Lehman Brothers Holdings Inc.
and JPMorgan Chase Bank for the benefit of the holders identified therein of
Lehman Brothers Holdings Capital Trust III, (D) the Guarantee Agreement, dated
as of October 31, 2003, executed and delivered by Lehman Brothers Holdings
Inc. and JPMorgan Chase Bank for the benefit of the holders identified therein
of Lehman Brothers Holdings Capital Trust IV and (E) this Guarantee and (iii)
(A) the Amended and Restated Declaration of Trust, dated as of January 26,
1999, by and among Lehman Brothers Holdings Inc., the Regular Trustees named
therein, The Chase Manhattan Bank, as initial Property Trustee and Chase Manhattan
Bank USA, National Association, as initial Delaware Trustee, (B) the Amended
and Restated Declaration of Trust, dated as of April 20, 1999, by and
among Lehman Brothers Holdings Inc., the Regular Trustees named therein, The
Chase Manhattan Bank, as initial Property Trustee and Chase Manhattan Bank USA,
National Association, as initial Delaware Trustee, (C) the Amended and Restated
Declaration of

 

6

 

Trust, dated as of March 17, 2003, by and among Lehman Brothers
Holdings Inc., the Regular Trustees named therein, JPMorgan Chase Bank, as
initial Property Trustee and Chase Manhattan Bank USA, National Association, as
initial Delaware Trustee, (D) the Amended and Restated Declaration of Trust,
dated as of October 31, 2003, by and among Lehman Brothers Holdings Inc.,
the Regular Trustees named therein, JPMorgan Chase Bank, as initial Property
Trustee and Chase Manhattan Bank USA, National Association, as initial Delaware
Trustee and (E) the Declaration.

 

2.9.                              Disclosure
of Information.  The
disclosure of information as to the names and addresses of the Holders of the
Securities in accordance with Section 312 of the Trust Indenture Act,
regardless of the source from which such information was derived, shall not be
deemed to be a violation of any existing law, or any law hereafter enacted
which does not specifically refer to Section 312 of the Trust Indenture
Act, nor shall the Guarantee Trustee be held accountable by reason of mailing
any material pursuant to a request made under Section 312(b) of the Trust
Indenture Act.

 

2.10.                        Guarantee
Trustee May File Proofs of Claim.  Upon the occurrence of a Guarantee Event of Default, the
Guarantee Trustee is hereby authorized to (a) recover judgment, in its own name
and as trustee of an express trust, against the Guarantor for the whole amount
of any Guarantee Payments remaining unpaid and (b) file such proofs of claim
and other papers or documents as may be necessary or advisable in order to have
its claims and those of the Holders of the Securities allowed in any judicial
proceedings relative to the Guarantor, its creditors or its property.

 

SECTION 3

POWERS,
DUTIES AND RIGHTS OF

GUARANTEE TRUSTEE

 

3.1.                              Powers
and Duties of Guarantee Trustee.

 

(a)                                  This Guarantee
shall be held by the Guarantee Trustee on behalf of the Trust for the benefit
of the Holders of the Securities, and the Guarantee Trustee shall not transfer
this Guarantee to any Person except a Holder of Securities exercising his or
her rights pursuant to Section 5.4(b) or to a Successor Guarantee Trustee
on acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee.  The right,
title and interest of the Guarantee Trustee in and to this Guarantee shall
automatically vest in any Successor Guarantee Trustee, and such vesting and
succession of title shall be effective whether or not conveyance documents have
been executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.

 

(b)                                 If a Guarantee
Event of Default actually known to a Responsible Officer of the Guarantee
Trustee has occurred and is continuing, the Guarantee Trustee shall enforce
this Guarantee for the benefit of the Holders of the Securities.

 

(c)                                  The Guarantee
Trustee, before the occurrence of any Guarantee Event of Default and after the
curing of all Guarantee Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Guarantee,

 

7

 

and
no implied covenants shall be read into this Guarantee against the Guarantee
Trustee.  In case a Guarantee Event of
Default has occurred (that has not been cured or waived pursuant to
Section 2.6) and is actually known to a Responsible Officer of the Guarantee
Trustee, the Guarantee Trustee shall exercise such of the rights and powers
vested in it by this Guarantee, and use the same degree of care and skill in
its exercise thereof, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.

 

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

 

(i)                                     prior to the
occurrence of any Guarantee Event of Default and after the curing or waiving of
all such Guarantee Events of Default that may have occurred:

 

(A)                              the duties and
obligations of the Guarantee Trustee shall be determined solely by the express
provisions of this Guarantee, and the Guarantee Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Guarantee, and no implied covenants or obligations shall be
read into this Guarantee against the Guarantee Trustee; and

 

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

 

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

 

(iii)                               the Guarantee
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders of
not less than a Majority in Liquidation Amount of the Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee; and

 

8

 

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

 

3.2.                              Certain
Rights of Guarantee Trustee.

 

(a)                                  Subject to the
provisions of Section 3.1:

 

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

 

(ii)                                  Any direction
or act of the Guarantor contemplated by this Guarantee shall be sufficiently
evidenced by an Officers’ Certificate;

 

(iii)                               Whenever, in
the administration of this Guarantee, the Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officers’ Certificate which, upon receipt
of such request, shall be promptly delivered by the Guarantor;

 

(iv)                              The Guarantee
Trustee shall have no duty to see to any recording, filing or registration or
any instrument (or any rerecording, refiling or re-registration thereof);

 

(v)                                 The Guarantee
Trustee may consult with counsel, and the advice or opinion of such counsel
with respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with such advice or opinion.  Such counsel may be counsel to the Guarantor
or any of its Affiliates and may include any of its employees.  The Guarantee Trustee shall have the right
at any time to seek instructions concerning the administration of this
Guarantee from any court of competent jurisdiction;

 

(vi)                              The Guarantee
Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Guarantee at the request or direction of any Holder,
unless such Holder shall have provided to the Guarantee Trustee such security
and indemnity, reasonably satisfactory to the Guarantee Trustee, against

 

9

 

the
costs, expenses (including attorneys’ fees and expenses and the expenses of the
Guarantee Trustee’s agents, nominees or custodians) and liabilities that might
be incurred by it in complying with such request or direction, including such
reasonable advances as may be requested by the Guarantee Trustee; provided,
that nothing contained in this Section 3.2(a)(vi) shall be taken to
relieve the Guarantee Trustee, upon the occurrence of a Guarantee Event of
Default, of its obligation to exercise the rights and powers vested in it by
this Guarantee;

 

(vii)                           The Guarantee
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Guarantee Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit;

 

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

 

(ix)                                Any action
taken by the Guarantee Trustee or its agents hereunder shall bind the Holders,
and the signature of the Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action.  No third party shall be required to inquire as to the authority
of the Guarantee Trustee to so act or as to its compliance with any of the
terms and provisions of this Guarantee, both of which shall be conclusively
evidenced by the Guarantee Trustee’s or its agent’s taking such action; and

 

(x)                                   Whenever in the
administration of this Guarantee the Guarantee Trustee shall deem it desirable
to receive instructions with respect to enforcing any remedy or right or taking
any other action hereunder, the Guarantee Trustee (i) may request written
instructions from the Holders of a Majority in Liquidation Amount of the
Securities, (ii) may refrain from enforcing such remedy or right or taking such
other action until such written instructions are received, and (iii) shall be
protected in conclusively relying on or acting in accordance with such written
instructions.

 

(b)                                 No provision of
this Guarantee shall be deemed to impose any duty or obligation on the
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Guarantee Trustee shall be unqualified or
incompetent to act in accordance with applicable law, to perform any such act
or acts or to exercise any such right, power, duty or obligation.  No permissive power or authority available
to the Guarantee Trustee shall be construed to be a duty.

 

10

 

3.3.                              Not
Responsible for Recitals or Issuance of Guarantee.  The recitals contained in this Guarantee
shall be taken as the statements of the Guarantor, and the Guarantee Trustee
does not assume any responsibility for their correctness.  The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee.

 

SECTION 4

GUARANTEE
TRUSTEE

 

4.1.                              Guarantee
Trustee; Eligibility.

 

(a)                                  There shall be
at all times a Guarantee Trustee which shall:

 

(i)                                     not be an
Affiliate of the Guarantor; and

 

(ii)                                  be a
corporation organized and doing business under the laws of the United States of
America or any state or territory thereof or of the District of Columbia, or a
corporation or other Person permitted by the Securities and Exchange Commission
to act as an institutional trustee under the Trust Indenture Act, authorized
under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars ($50,000,000), and subject to
supervision or examination by federal, state, territorial or District of
Columbia authority.  If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to above, then,
for the purposes of this Section 4.1(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.

 

(b)                                 If at any time
the Guarantee Trustee shall cease to be eligible to so act under
Section 4.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).

 

(c)                                  If the
Guarantee Trustee has or shall acquire any “conflicting interest” within the
meaning of Section 310(b) of the Trust Indenture Act, the Guarantee
Trustee and Guarantor shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act.

 

4.2.                              Appointment,
Removal and Resignation of Guarantee Trustee.

 

(a)                                  Subject to
Section 4.2(b), unless a Guarantee Event of Default shall have occurred
and be continuing, the Guarantee Trustee may be appointed or removed with or
without cause at any time by the Guarantor.

 

(b)                                 The Guarantee
Trustee shall not be removed in accordance with Section 4.2(a) until a
Successor Guarantee Trustee has been appointed and has accepted such
appointment by written instrument executed by such Successor Guarantee Trustee
and delivered to the Guarantor.

 

11

 

(c)                                  The Guarantee
Trustee appointed to office shall hold such office until a Successor Guarantee
Trustee shall have been appointed or until its removal or resignation.  The Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
executed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed
by such Successor Guarantee Trustee and delivered to the Guarantor and the
resigning Guarantee Trustee.

 

(d)                                 If no Successor
Guarantee Trustee shall have been appointed and accepted appointment as
provided in this Section 4.2 within 60 days after delivery to the
Guarantor of an instrument of removal or resignation, the removed or resigning
Guarantee Trustee may petition any court of competent jurisdiction for
appointment of a Successor Guarantee Trustee. 
Such court may thereupon, after prescribing such notice, if any, as it
may deem proper, appoint a Successor Guarantee Trustee.

 

(e)                                  No Guarantee
Trustee shall be liable for the acts or omissions to act of any Successor
Guarantee Trustee.

 

(f)                                    Upon
termination of this Guarantee or removal or resignation of the Guarantee
Trustee pursuant to this Section 4.2, the Guarantor shall pay to the
Guarantee Trustee all amounts owing for fees and reimbursement of expenses
which have accrued to the date of such termination, removal or resignation.

 

SECTION 5

GUARANTEE

 

5.1.                              Guarantee.

 

The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Trust), as and when due, regardless of any defense, right of
set-off or counterclaim that the Trust may have or assert.  The Guarantor’s obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Trust to pay such amounts to the
Holders.  Notwithstanding anything to
the contrary herein, the Guarantor retains all of its rights under the
Indenture to (i) extend the interest payment period on the Debentures and
the Guarantor shall not be obligated hereunder to make any Guarantee Payments
during any Extension Period (as defined in the certificate evidencing the
Debentures) with respect to the Distributions (as defined in the Declaration)
on the Securities and (ii) change the maturity date of the Debentures to
the extent permitted by the Indenture.

 

12

 

5.2.                              Waiver of
Notice and Demand.

 

The Guarantor hereby waives notice of acceptance of this Guarantee and
of any liability to which it applies or may apply, presentment, demand for
payment, any right to require a proceeding first against the Trust or any other
Person before proceeding against the Guarantor, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and demands.

 

5.3.                              Obligations
Not Affected.

 

The obligations, covenants, agreements and duties of the Guarantor
under this Guarantee shall be absolute and unconditional and shall remain in
full force and effect until the entire liquidation amount of all outstanding
Securities shall have been paid and such obligation shall in no way be affected
or impaired by reason of the happening from time to time of any event,
including without limitation, the following, whether or not with notice to, or
the consent of, the Guarantor:

 

(a)                                  The release or
waiver, by operation of law or otherwise, of the performance or observance by
the Trust of any express or implied agreement, covenant, term or condition
relating to the Securities to be performed or observed by the Trust;

 

(b)                                 The extension
of time for the payment by the Trust of all or any portion of the
Distributions, Redemption Price, Liquidation Distribution or any other sums
payable under the terms of the Securities or the extension of time for the
performance of any other obligation under, arising out of, or in connection
with the Securities (other than an extension of time for payment of
Distributions, Redemption Price, Liquidation Distribution or other sum payable
that results from the extension of any interest payment period on the
Debentures or any change to the maturity date of the Debentures permitted by
the Indenture);

 

(c)                                  Any failure,
omission, delay or lack of diligence on the part of the Property Trustee or the
Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Property Trustee or the Holders pursuant to the terms of the
Securities, or any action on the part of the Trust granting indulgence or
extension of any kind;

 

(d)                                 The voluntary
or involuntary liquidation, dissolution, sale of any collateral, receivership,
insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Trust or any of the assets of the Trust;

 

(e)                                  Any invalidity
of, or defect or deficiency in, the Securities;

 

(f)                                    The settlement
or compromise of any obligation guaranteed hereby or hereby incurred; or

 

(g)                                 Any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a guarantor, it being the intent of this
Section 5.3 that

 

13

 

the
obligations of the Guarantor hereunder shall be absolute and unconditional
under any and all circumstances.

 

There shall be no obligation of the Guarantee Trustee or the Holders to
give notice to, or obtain consent of the Guarantor or any other Person with
respect to the happening of any of the foregoing.

 

No setoff, counterclaim, reduction or diminution of any obligation, or
any defense of any kind or nature that the Guarantor has or may have against
any Holder shall be available hereunder to the Guarantor against such Holder to
reduce the payments to it under this Guarantee.

 

5.4.                              Rights of
Holders.

 

(a)                                  The Holders of
at least a Majority in Liquidation Amount of the Securities have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee in respect of this Guarantee or to direct
the exercise of any trust or power conferred upon the Guarantee Trustee under
this Guarantee.

 

(b)                                 If the
Guarantee Trustee fails to enforce this Guarantee, then any Holder of
Securities may, subject to the subordination provisions of Section 6.2,
institute a legal proceeding directly against the Guarantor to enforce the
Guarantee Trustee’s rights under this Guarantee without first instituting a
legal proceeding against the Trust, the Guarantee Trustee or any other person
or entity.  In addition, if the
Guarantor has failed to make a Guarantee Payment, a Holder of Securities may,
subject to the subordination provisions of Section 6.2, directly institute
a proceeding against the Guarantor for enforcement of the Guarantee for such
payment to the Holder of the Securities of the principal of or interest on the
Debentures on or after the respective due dates specified in the Debentures,
and the amount of the payment will be based on the Holder’s pro rata share of
the amount due and owing on all of the Securities.  The Guarantor hereby waives any right or remedy to require that
any action on this Guarantee be brought first against the Trust or any other
person or entity before proceeding directly against the Guarantor.

 

5.5.                              Guarantee
of Payment.

 

This Guarantee creates a guarantee of payment and not of collection.

 

5.6.                              Subrogation.

 

The Guarantor shall be subrogated to all (if any) rights of the Holders
of Securities against the Trust in respect of any amounts paid to such Holders
by the Guarantor under this Guarantee; provided, however, that the Guarantor
shall not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any right that it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee, if at the time of any such payment,
any amounts are due and unpaid under this Guarantee.  If any amount shall be paid to the Guarantor in violation

 

14

 

of the preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount to the Guarantee Trustee for
the benefit of the Holders.

 

5.7.                              Independent Obligations.

 

The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Trust with respect to the Securities, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee notwithstanding the
occurrence of any event referred to in subsections 5.3(a) through 5.3(g),
inclusive, hereof.

 

SECTION 6

LIMITATION
OF TRANSACTIONS; SUBORDINATION

 

6.1.                              Limitation of Transactions.

 

So long as any Securities remain outstanding, if (i) there shall have
occurred an event of default under the Indenture with respect to the
Debentures, (ii) there shall be a Guarantee Event of Default or (iii) the
Guarantor shall have given notice of its election of an Extension Period as
provided in the certificate evidencing the Debentures and shall not have
rescinded such notice, or such Extension Period or any extension thereof shall
be continuing, then the Guarantor shall not, and shall not permit any
subsidiary of the Guarantor, to (x) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Guarantor’s capital stock or (y) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Guarantor that rank on a parity with or junior in
interest to the Debentures or make any guarantee payments with respect to any
guarantee by the Guarantor of the debt securities of any subsidiary of the
Guarantor if such guarantee ranks on a parity with or junior in interest to the
Debentures (other than (a) dividends or distributions in common stock of the
Guarantor, (b) payments under this Guarantee, (c) any declaration of a dividend
in connection with the implementation of a shareholders’ rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, and (d) purchases of common
stock related to the issuance of common stock or rights under any of the
Guarantor’s benefit plans).

 

6.2.                              Ranking.

 

This Guarantee will constitute an unsecured obligation of the Guarantor
and will rank (i) subordinate and junior in right of payment to all other
liabilities of the Guarantor, (ii) on a parity with the most senior preferred
or preference stock now or hereafter issued by the Guarantor and with any guarantee
now or hereafter entered into by the Guarantor in respect of any preferred
securities of any Affiliate of the Guarantor and (iii) senior to the
Guarantor’s common stock.  In addition,
at all times such obligations will be structurally subordinated to the
liabilities and obligations of the Guarantor’s subsidiaries.

 

15

 

6.3.                              Subordination
of Common Securities

 

If a Trust Enforcement Event has occurred and is continuing under the
Declaration, the rights of the holders of the Common Securities to receive
Guarantee Payments hereunder shall be subordinated to the rights of the Holders
of the Preferred Securities to receive Guarantee Payments under this Guarantee.

 

SECTION 7

TERMINATION

 

7.1.                              Termination.

 

This Guarantee shall terminate upon (i) full payment of the
Redemption Price of all of the Securities, (ii) distribution of the
Debentures to the Holders of all of the Securities or (iii) full payment
of the amounts payable in accordance with the Declaration upon liquidation of
the Trust.  Notwithstanding the
foregoing, this Guarantee will continue to be effective or will be reinstated,
as the case may be, if at any time any Holder of Securities must restore
payment of any sums paid under the Securities or under this Guarantee.

 

SECTION 8

INDEMNIFICATION

 

8.1.                              Exculpation.

 

(a)                                  No Indemnified
Person shall be liable, responsible or accountable in damages or otherwise to
the Guarantor or any Covered Person for any loss, damage, liability, expense or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Guarantee and in a
manner that such Indemnified Person reasonably believed to be within the scope
of the authority conferred on such Indemnified Person by this Guarantee or by
law, except that an Indemnified Person shall be liable for any such loss,
damage or claim incurred by reason of such Indemnified Person’s negligence or
willful misconduct with respect to such acts or omissions.

 

(b)                                 An Indemnified
Person shall be fully protected in relying in good faith upon the records of
the Guarantor and upon such information, opinions, reports or statements
presented to the Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person’s professional or expert
competence and who has been selected with reasonable care by or on behalf of
the Guarantor, including information, opinions, reports or statements as to the
value and amount of the assets, liabilities, profits, losses, or any other
facts pertinent to the existence and amount of assets from which Distributions
to Holders of Securities might properly be paid.

 

16

 

8.2.                              Indemnification.

 

The Guarantor agrees to indemnify each Indemnified Person for, and to
hold each Indemnified Person harmless against any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against, or investigating, any claim or
liability in connection with the exercise or performance of any of its powers
or duties hereunder.  The obligation to
indemnify as set forth in this Section 8.2 shall survive the termination
of this Guarantee.

 

SECTION 9

MISCELLANEOUS

 

9.1.                              Successors and Assigns.

 

All guarantees and agreements contained in this Guarantee shall bind
the successors, assigns, receivers, trustees and representatives of the
Guarantor and shall inure to the benefit of the Holders of the Securities then
outstanding.

 

9.2.                              Amendments.

 

Except with respect to any changes that do not materially adversely
affect the rights of the Holders (in which case no consent of the Holders will
be required), this Guarantee may not be amended without the prior approval of
the Holders of not less than 66-2/3% of the aggregate liquidation amount of the
Securities.  The provisions of
Section 11.2 of the Declaration with respect to meetings of, and action by
written consent of, the Holders of the Securities apply to the giving of such
approval.

 

9.3.                              Notices.

 

All notices provided for in this Guarantee shall be in writing, duly
signed by the party giving such notice, and shall be delivered by hand,
telecopied or mailed by registered or certified mail, as follows:

 

(a)                                  If given to the
Guarantee Trustee, at the Guarantee Trustee’s mailing address set forth below
(or such other address as the Guarantee Trustee may give notice of to the
Guarantor and the Holders of the Securities):

 

JPMorgan Chase Bank

4 New York Plaza

15th Floor

New York, New York  10004

Attention:  Institutional Trust
Services

Facsimile: (212) 623-6274

 

17

 

(b)                                 If given to the
Guarantor, at the Guarantor’s mailing addresses set forth below (or such other
address as the Guarantor may give notice of to the Guarantee Trustee and the
Holders of the Securities):

 

Lehman Brothers Holdings Inc.

399 Park Avenue

New York, New York  10022

Attention: Corporate Counsel

Facsimile:  (212) 526-0339

 

(c)                                  If given to any
Holder of Securities, at the address set forth on the books and records of the
Trust.

 

All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.

 

9.4.                              Benefit.

 

This Guarantee is solely for the benefit of the Holders of the
Securities and, subject to Section 3.1(a), is not separately transferable
from the Securities.

 

9.5.                              Governing
Law.

 

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

 

18

 

 

IN WITNESS WHEREOF, this Guarantee is executed as of the day and year
first above written.

 

	
   

  	
  LEHMAN BROTHERS HOLDINGS INC.,

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: Barrett S. DiPaolo

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK

  
	
   

  	
  as Guarantee Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  

 

19Exhibit
10.1

 

EMPLOYMENT
AGREEMENT

 

This Employment Agreement is made and
entered into this 27 day of June, 1990, by and among INET, Inc., a Texas
corporation (the “Employer”), and Michael J. Reiman, an individual residing in
the State of Texas (the “Employee”).

 

RECITALS:

 

A.                                   Employer
is engaged as a telecommunications equipment manufacturer;

 

B.                                     Employer
desires to engage Employee as an employee to perform the services required of
him by the terms hereof;

 

C.                                     Employer
desires to provide an incentive for Employee to participate in the growth and
successful operation of Employer;

 

D.                                    Employee
desires to accept employment as an employee of Employer; and

 

E.                                      Employer
desires to protect its legitimate business interests.

 

NOW THEREFORE, in
consideration of the mutual covenants and agreements herein contained, the
parties hereby agree as follows:

 

ARTICLE I

 

ASSOCIATION
AND RELATIONSHIP

 

1.1 
Nature of Employment. 
Employer hereby employs Employee and Employee hereby accepts such
employment from Employer upon the terms and conditions herein set forth. In his
employment with Employer, Employee may be assigned to any territory, may be
directed to occupy various positions, and may be required to work in any
location, all this designated by Employer as it determines to be in its best
interest.

 

1.2 
Nature of Relationship. 
Employer agrees to employ Employee and Employee agrees to render his
exclusive services to Employer with such duties as may be assigned to him from
time to time by Employer. Employee agrees to perform his duties in accordance
with any rules and regulations promulgated by Employer. It is expressly agreed
that the continued employment of Employee by Employer from the date of this
Agreement is part of Employee’s consideration for this Agreement.

 

1

 

1.3 
Exclusive Services. Employee shall devote his entire time and
attention to Employer’s business and affairs and shall not, without the consent
of the Board of Directors of Employer, either directly or indirectly, engage in
any other profession or business which would necessitate Employee giving an
appreciable portion of his time and effort to the detriment of Employer’s
business. Passive and personal investments and the conduct of private business
affairs shall not be prohibited under this Agreement to the extent that such
activities do not detrimentally affect Employer’s business.

 

ARTICLE II

 

COMPENSATION

 

2.1 
Compensation. In consideration of his services, Employer agrees
that during the term of this Agreement, Employee shall be paid Three Thousand
Four Hundred dollars ($3,400.00) per calendar month.

 

2.2 
Stock Option Arrangement. 
In consideration of Employee’s employment with Employer and in order to
provide Employee with an opportunity to purchase a proprietary interest in
Employer, Employer agrees to grant Employee a stock option pursuant to a Stock
Option Agreement to be executed by the parties.

 

2.3 
Working Facilities. 
Employee shall be furnished with such facilities and services as may be
required by his position and the adequate performance of his duties.

 

2.4 
Reimbursement of Expenses. 
The Employer shall reimburse the Employee for all reasonable and
necessary expenses incurred in the performance of his duties hereunder.

 

ARTICLE III

 

COVENANT
NOT TO COMPETE

 

3.1 
Covenant.  Employee hereby
agrees that during the term of this Agreement and for a period of two (2) years
after the termination hereof, regardless of the cause of termination, Employee
will not directly or indirectly, either through any kind of ownership (other
than ownership of securities of a publicly held corporation of which Employee
owns less than one percent of any class of outstanding securities), or as a
director, officer, principal, agent, employee, employer, advisor, consultant,
co-partner, or in any individual or representative capacity whatever, either
for his own benefit or for the benefit of any other person, firm, or
corporation, without the prior written consent of the Board of Directors of
Employer, compete with Employer by engaging in any of the following acts, which
acts shall be considered violations of this covenant not to compete:

 

2

 

(a)                                  Directly or indirectly engage in
the selling or merchandising of any Product Line (hereinafter defined) which
Employer sells, solicits the sale of, or otherwise merchandises the Product
Line;

 

(b)                                 Canvass, solicit, accept, or
perform any type of work then performed by Employer with respect to the Product
Line of any Supplier (hereinafter defined) of Employer, including but not
limited to, the solicitation of the right to sell, merchandise, or distribute
any Product Line of a Supplier;

 

(c)                                  Directly
or indirectly induce or attempt to induce any Supplier or Customer
(hereinafter defined) to withdraw, curtail, or cancel its business with
Employer;

 

(d)                                 Give or attempt to give any
person, partnership, or corporation the right to solicit or canvass any
Supplier for the selling, merchandising, or distribution of any Product Line;
or

 

(e)                                  Directly
or indirectly disclose to any person, partnership, or corporation, the name of
any Supplier.

 

3.2 
Definitions. 

 

(a)                                  Product
Line. As used herein the term “Product Line” includes any form
of goods, merchandise, or product that is manufactured, merchandised, sold, or
in any way produced or distributed by Employer or a Supplier of Employer.

 

(b)                                 Suppliers. As
used herein the term “Suppliers” includes any individual or business entity for
which Employer merchandises, sells, or otherwise aids in the distribution of
any goods, merchandise, or products of any kind during the term of this
Agreement; from which Employer purchases any goods, merchandise, or products of
any kind for resale during the term of this Agreement; or prospective suppliers
with which Employee has reason to believe negotiations are under way upon
termination of this Agreement.

 

(c)                                  Customers. As
used herein the term “Customers” includes any individual or business entity
which has purchased any goods, merchandise, or products from Employer, or any
architect, engineer, programmer or designer that has recommended any item of a
Product Line or consulted with Employer regarding any Product Line.

 

3

 

ARTICLE IV

 

CONFIDENTIAL
INFORMATION

 

4.1 
Nondisclosure. Employee expressly covenants and agrees that he
will not, during his employment with Employer or at any time after the
termination hereof, irrespective of the time, manner, or cause of the
termination, directly or indirectly, reveal, divulge, disclose, or communicate
to any person, film, or corporation, other than authorized officers, directors,
and employees of Employer, in any manner whatsoever, any Confidential
Information of Employer or any of its subsidiaries or affiliates without the
prior written consent of the Board of Directors of Employer.

 

4.2 
Definition of “Confidential Information”. As used herein,
“Confidential Information” means information of any kind, nature, and
description disclosed to, discovered by, or otherwise known by Employee as a
direct or indirect consequence of or through his employment with Employer, not
generally known in the businesses in which Employer is or may become engaged,
about Employer’s business, merchandise, processes and services, including, but
not limited to, information relating to Employer’s research, developments,
inventions, product lines, designs, purchasing, finances and financial affairs,
marketing, merchandising, clients, customers, architects, designers, or persons
or concerns likely to become clients, customers, architects, or designers, any
past or present merchandise or supply sources, or persons or concerns likely to
become merchandise or supply sources in the future, system designs, procedure
manuals, the prices it obtains or has obtained or at which it sells or has sold
its services or products, the name of its personnel, automated data programs,
reports, personnel procedures, and supply and service resources.

 

4.3 
Return of Confidential Information. Upon termination of this
Agreement, unless authorized to the contrary in writing by the Board of
Directors of Employer, Employee will surrender to Employer all Confidential
Information, including, but not limited to, all lists, charts, schedules,
reports, financial statements, books, and records, and all copies thereof, of
Employee and any and all other property belonging to Employer whatsoever.

 

ARTICLE V

 

SURVIVAL OF
COVENANTS

 

In the event of termination of this
Agreement, with or without cause, then (a) the covenant contained in
Article ill hereof shall survive for a period of two (2) years after the
date this Agreement is terminated and (b) the covenant contained in
Article IV hereof shall survive indefinitely. During the continuation, the
covenants shall remain in full force and effect as if the Agreement were
continuing.

 

4

 

ARTICLE VI

 

ENFORCEMENT OF
COVENANTS

 

Employee agrees that a violation in his part
of any covenant contained in this agreement will cause such damage to Employer
as will be irreparable and for that reason, Employee further agrees that
Employer shall be entitled, as a matter of right, to an injunction out of any
court of competent jurisdiction, restraining any further violation of said
covenants by Employee, his employer, employees, partners, or agents. Such right
to injunction shall be cumulative and in addition to whatever other remedies
Employer may have, including, specifically, recovery of liquidated and
additional damages. Employee expressly acknowledges and agrees that the
respective covenants and agreements contained herein are reasonable as to both
scope and time. Employee and Employer expressly acknowledge and agree that such
covenants and agreements shall be construed in such a manner as to be
enforceable under applicable laws if a court of competent jurisdiction
determines that a more limited scope of time is required.

 

ARTICLE VII

 

TERM OF
AGREEMENT

 

7.1 
Term.  The term of this
Agreement shall be for a period of one year from the date hereof, and shall,
without the necessity of any action by either party, automatically renew for
subsequent one year periods, but subject to termination by the Employer giving
thirty (30) days or more written notice to the Employee. In the event of
termination, Employer shall be under no obligation to Employee except to pay
him such salary as he may be entitled to receive up to the time of termination.

 

7.2 
Immediate Termination. Employer may terminate this Agreement
without notice if Employee breaches any of the covenants of this Agreement
including, but not limited to, disclosing Confidential Information, or in any
way jeopardizing the professional integrity, reputation, or client
relationships of Employer. The determination of a breach of any covenant for
purposes of this section shall be at Employer’s sole discretion.

 

7.3 
Mutual Agreement. Employee’s employment under this Agreement may
be terminated by mutual written agreement of Employee and Employer.

 

7.4  Illness or Incapacity. If during the
term of this Agreement, or any renewal term, the Employee should be prevented
from performing his duties by reason of illness or incapacity for an aggregate
of three (3) months in anyone year, the Employer shall not be obligated to pay
the Employee any compensation for any period of absence in excess of the
aggregate of three (3) months in any year. If during the term of this
Employment Agreement, or any renewal term, the Employee should be prevented
from performing his duties by reason of illness or incapacity for a continuous
period of three (3) months, then the Employer, may, if it so elects, upon
thirty (30) days’ prior notice, terminate the Employee’s employment.

 

5

 

7.5 
Death of Employee. In the event of the Employee’s death during
the term of this Agreement, this Agreement shall terminate immediately and the
Employee’s estate shall receive the salary due to the Employee through the last
day of the calendar month in which his death shall have occurred.

 

7.6 
Termination Upon Sale of Business. Notwithstanding anything
herein contained to the contrary, the Employer may terminate this Agreement
upon thirty (30) days’ written notice to the Employee upon the happening of any
of the following events; (A) the sale by the Employer of substantially all of
its assets; (B) the sale, exchange or other disposition, in one transaction, of
fifty- one percent (51 %) of the outstanding shares of the Employer; (C) a
decision by the Employer to terminate its business and liquidate its assets; or
(D) the merger or consolidation of the Employer in a transaction in which the
shareholders of the Employer receive less than fifty per cent (50%) of the
outstanding voting shares of the new or continuing entity.

 

ARTICLE VIII

 

MISCELLANEOUS

 

8.1 
Notice. All notices provided for by this Agreement shall be made
in writing; (a) either by actual delivery of the notice to the party thereunto
entitled; or (b) by the mailing of the notice in the United States mail
addressed to the party to be notified at the address listed below (or at such
other address as may have been designated by written notice), certified or
registered mail, return receipt requested. The notice shall be deemed to be
received (a) if by personal delivery, on the date of its actual receipt by the
party entitled thereto or (b) if by mail, on the date of deposit in the United
States mail.

 

	
  EMPLOYER:

  	
   

  	
  INET, Inc.

  
	
   

  	
   

  	
  740 East Campbell

  
	
   

  	
   

  	
  Suite 812

  
	
   

  	
   

  	
  Richardson, Texas 75081

  
	
   

  	
   

  	
   

  
	
  EMPLOYEE:

  	
   

  	
  Michael J. Reiman

  
	
   

  	
   

  	
  615 Hilltop Circle

  
	
   

  	
   

  	
  Wylie, Texas 75098

  

 

8.2 
Entire Agreement. This Agreement contains the entire agreement of
the parties and supercedes all prior agreements and understandings, oral or
written, if any, between the parties. No modification or amendment of any of
the terms, conditions, or provisions herein may be made otherwise than by
written agreement signed by the parties.

 

6

 

8.3 
Governing Law. The laws of the State of Texas shall govern the
validity, construction, enforcement and interpretation of this Agreement.

 

8.4 
Parties Bound. This Agreement and the rights and obligations
hereunder shall be binding upon and inure to the benefit of Employer, Employee,
and their respective heirs, personal representatives, successors, and assigns;
provided, however, that Employee may not assign any rights or obligations
hereunder without the express written consent of Employer. This Agreement shall
also bind and inure to the benefit of any successor of Employer by merger or
consolidation, or any assignee of all or substantially all of Employer’s
properties.

 

8.5 
Savings Clause. If anyone or more of the provisions contained in
this Agreement shall for any reason be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect the validity and enforceability of any other provisions
hereof. Further, should any provisions within this Agreement ever be reformed
or rewritten by a judicial body, such provisions as so rewritten shall be
binding upon Employer and Employee.

 

8.6 
Waiver of Breach. The waiver by any party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of
any subsequent breach by any party.

 

8.7 
Descriptive Heading. Titles to paragraphs are for information purposes
only and shall not be used for interpretation of this Agreement.

 

8.8 
Multiple Counterparts. This Agreement has been executed in a
number of identical counterparts, each of which for all purposes is to be
deemed an original, and all of which constitute, collectively, one agreement;
but in making proof of this Agreement, it shall not be necessary to produce or
account for more than one such counterpart.

 

IN WITNESS WHEREOF, this
Agreement is signed and executed the day and year rust above written.

 

	
  EMPLOYER:

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Mark A. Weinzierl

  	
   

  	
  /s/ Michael J. Reiman

  	
   

  
	
  INET, Inc.

  	
  Michael J. Reiman

  
	
  By:

  	
   

  	
  Mark A. Weinzierl

  	
   

  	
   

  
	
  Title:

  	
   

  	
  Secretary

  	
   

  	
   

  
							

 

7

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