Document:

Exhibit 10.4

 

 

 

AMERICAN CAPITAL ACCESS
HOLDINGS LIMITED,

as Issuer

 

 

 

INDENTURE

Dated as of October 29,
2003

 

 

U.S. BANK NATIONAL
ASSOCIATION,

as Trustee

 

 

 

FLOATING RATE JUNIOR SUBORDINATED

DEFERRABLE INTEREST DEBENTURES

 

 

DUE 2033

 

 

 

TABLE OF
CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I.

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 1.1.

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
  DEBENTURES

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 2.1.

  	
  Authentication and Dating

  	
  7

  
	
   

  	
  Section 2.2.

  	
  Form of Trustee’s Certificate of
  Authentication

  	
  8

  
	
   

  	
  Section 2.3.

  	
  Form and Denomination of Debentures

  	
  8

  
	
   

  	
  Section 2.4.

  	
  Execution of Debentures

  	
  8

  
	
   

  	
  Section 2.5.

  	
  Exchange and Registration of Transfer of
  Debentures

  	
  8

  
	
   

  	
  Section 2.6.

  	
  Mutilated, Destroyed, Lost or Stolen
  Debentures

  	
  11

  
	
   

  	
  Section 2.7.

  	
  Temporary Debentures

  	
  12

  
	
   

  	
  Section 2.8.

  	
  Payment of Interest and Additional Interest

  	
  12

  
	
   

  	
  Section 2.9.

  	
  Cancellation of Debentures Paid, etc

  	
  14

  
	
   

  	
  Section 2.10.

  	
  Computation of Interest

  	
  14

  
	
   

  	
  Section 2.11.

  	
  Extension of Interest Payment Period

  	
  16

  
	
   

  	
  Section 2.12.

  	
  CUSIP Numbers

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
  PARTICULAR COVENANTS OF THE
  COMPANY

  	
  17

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 3.1.

  	
  Payment of Principal, Premium and Interest;
  Agreed Treatment of the Debentures

  	
  17

  
	
   

  	
  Section 3.2.

  	
  Offices for Notices and Payments, etc

  	
  18

  
	
   

  	
  Section 3.3.

  	
  Appointments to Fill Vacancies in Trustee’s
  Office

  	
  19

  
	
   

  	
  Section 3.4.

  	
  Provision as to Paying Agent

  	
  19

  
	
   

  	
  Section 3.5.

  	
  Certificate to Trustee

  	
  20

  
	
   

  	
  Section 3.6.

  	
  Additional Sums

  	
  20

  
	
   

  	
  Section 3.7.

  	
  Compliance with Consolidation Provisions

  	
  20

  
	
   

  	
  Section 3.8.

  	
  Limitation on Dividends

  	
  20

  
	
   

  	
  Section 3.9.

  	
  Covenants as to the Trust

  	
  21

  
	
   

  	
  Section 3.10.

  	
  Additional Junior Indebtedness

  	
  21

  
	
   

  	
  Section 3.11.

  	
  Consent to Jurisdiction and Venue

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
  SECURITYHOLDERS LISTS AND
  REPORTS BY THE COMPANY AND THE TRUSTEE

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 4.1.

  	
  Securityholders Lists

  	
  22

  
	
   

  	
  Section 4.2.

  	
  Preservation and Disclosure of Lists

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
  REMEDIES OF THE TRUSTEE AND
  SECURITYHOLDERS UPON AN EVENT OF DEFAULT

  	
  23

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 5.1.

  	
  Events of Default

  	
  23

  
	
   

  	
  Section 5.2.

  	
  Payment of Debentures on Default; Suit
  Therefor

  	
  25

  
					

 

i

 

	
   

  	
  Section 5.3.

  	
  Application of Moneys Collected by Trustee

  	
  27

  
	
   

  	
  Section 5.4.

  	
  Proceedings by Securityholders

  	
  27

  
	
   

  	
  Section 5.5.

  	
  Proceedings by Trustee

  	
  28

  
	
   

  	
  Section 5.6.

  	
  Remedies Cumulative and Continuing; Delay
  or Omission Not a Waiver

  	
  28

  
	
   

  	
  Section 5.7.

  	
  Direction of Proceedings and Waiver of
  Defaults by Majority of Securityholders

  	
  28

  
	
   

  	
  Section 5.8.

  	
  Notice of Defaults

  	
  29

  
	
   

  	
  Section 5.9.

  	
  Undertaking to Pay Costs

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
  CONCERNING THE TRUSTEE

  	
  30

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 6.1.

  	
  Duties and Responsibilities of Trustee

  	
  30

  
	
   

  	
  Section 6.2.

  	
  Reliance on Documents, Opinions, etc

  	
  31

  
	
   

  	
  Section 6.3.

  	
  No Responsibility for Recitals, etc

  	
  32

  
	
   

  	
  Section 6.4.

  	
  Trustee, Authenticating Agent, Paying
  Agents, Transfer Agents or Registrar May Own Debentures

  	
  32

  
	
   

  	
  Section 6.5.

  	
  Moneys to be Held in Trust

  	
  32

  
	
   

  	
  Section 6.6.

  	
  Compensation and Expenses of Trustee

  	
  32

  
	
   

  	
  Section 6.7.

  	
  Officers’ Certificate as Evidence

  	
  33

  
	
   

  	
  Section 6.8.

  	
  Eligibility of Trustee

  	
  33

  
	
   

  	
  Section 6.9.

  	
  Resignation or Removal of Trustee

  	
  34

  
	
   

  	
  Section 6.10.

  	
  Acceptance by Successor Trustee

  	
  35

  
	
   

  	
  Section 6.11.

  	
  Succession by Merger, etc

  	
  36

  
	
   

  	
  Section 6.12.

  	
  Authenticating Agents

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII.

  	
  CONCERNING THE
  SECURITYHOLDERS

  	
  37

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 7.1.

  	
  Action by Securityholders

  	
  37

  
	
   

  	
  Section 7.2.

  	
  Proof of Execution by Securityholders

  	
  38

  
	
   

  	
  Section 7.3.

  	
  Who Are Deemed Absolute Owners

  	
  38

  
	
   

  	
  Section 7.4.

  	
  Debentures Owned by Company Deemed Not
  Outstanding

  	
  38

  
	
   

  	
  Section 7.5.

  	
  Revocation of Consents; Future Holders
  Bound

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII.

  	
  SECURITYHOLDERS MEETINGS

  	
  39

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 8.1.

  	
  Purposes of Meetings

  	
  39

  
	
   

  	
  Section 8.2.

  	
  Call of Meetings by Trustee

  	
  40

  
	
   

  	
  Section 8.3.

  	
  Call of Meetings by Company or
  Securityholders

  	
  40

  
	
   

  	
  Section 8.4.

  	
  Qualifications for Voting

  	
  40

  
	
   

  	
  Section 8.5.

  	
  Regulations

  	
  40

  
	
   

  	
  Section 8.6.

  	
  Voting

  	
  41

  
	
   

  	
  Section 8.7.

  	
  Quorum; Actions

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX.

  	
  SUPPLEMENTAL INDENTURES

  	
  42

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 9.1.

  	
  Supplemental Indentures without Consent of
  Securityholders

  	
  42

  
	
   

  	
  Section 9.2.

  	
  Supplemental Indentures with Consent of
  Securityholders

  	
  43

  
	
   

  	
  Section 9.3.

  	
  Effect of Supplemental Indentures

  	
  44

  
					

 

ii

 

	
   

  	
  Section 9.4.

  	
  Notation on Debentures

  	
  44

  
	
   

  	
  Section 9.5.

  	
  Evidence of Compliance of Supplemental
  Indenture to be Furnished to Trustee

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X.

  	
  REDEMPTION OF SECURITIES

  	
  45

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 10.1.

  	
  Optional Redemption

  	
  45

  
	
   

  	
  Section 10.2.

  	
  Special Event Redemption

  	
  45

  
	
   

  	
  Section 10.3.

  	
  Notice of Redemption; Selection of
  Debentures

  	
  45

  
	
   

  	
  Section 10.4.

  	
  Payment of Debentures Called for Redemption

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI.

  	
  CONSOLIDATION, MERGER, SALE,
  CONVEYANCE AND LEASE

  	
  46

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 11.1.

  	
  Company May Consolidate, etc., on Certain
  Terms

  	
  46

  
	
   

  	
  Section 11.2.

  	
  Successor Entity to be Substituted

  	
  47

  
	
   

  	
  Section 11.3.

  	
  Opinion of Counsel to be Given to Trustee

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII.

  	
  SATISFACTION AND DISCHARGE OF
  INDENTURE

  	
  47

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 12.1.

  	
  Discharge of Indenture

  	
  47

  
	
   

  	
  Section 12.2.

  	
  Deposited Moneys to be Held in Trust by
  Trustee

  	
  48

  
	
   

  	
  Section 12.3.

  	
  Paying Agent to Repay Moneys Held

  	
  48

  
	
   

  	
  Section 12.4.

  	
  Return of Unclaimed Moneys

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIII.

  	
  IMMUNITY OF INCORPORATORS,
  STOCKHOLDERS, OFFICERS AND DIRECTORS

  	
  49

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 13.1.

  	
  Indenture and Debentures Solely Corporate
  Obligations

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIV.

  	
  MISCELLANEOUS PROVISIONS

  	
  49

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 14.1.

  	
  Successors

  	
  49

  
	
   

  	
  Section 14.2.

  	
  Official Acts by Successor Entity

  	
  49

  
	
   

  	
  Section 14.3.

  	
  Surrender of Company Powers

  	
  49

  
	
   

  	
  Section 14.4.

  	
  Addresses for Notices, etc

  	
  49

  
	
   

  	
  Section 14.5.

  	
  Governing Law

  	
  50

  
	
   

  	
  Section 14.6.

  	
  Evidence of Compliance with Conditions
  Precedent

  	
  50

  
	
   

  	
  Section 14.7.

  	
  Non-Business Days

  	
  50

  
	
   

  	
  Section 14.8.

  	
  Table of Contents, Headings, etc

  	
  50

  
	
   

  	
  Section 14.9.

  	
  Execution in Counterparts

  	
  50

  
	
   

  	
  Section 14.10.

  	
  Severability

  	
  50

  
	
   

  	
  Section 14.11.

  	
  Assignment

  	
  51

  
	
   

  	
  Section 14.12.

  	
  Acknowledgment of Rights

  	
  51

  
	
   

  	
  Section 14.13.

  	
  Submission to Jurisdiction; Appointment of
  Agent for Service

  	
  51

  
	
   

  	
  Section 14.14.

  	
  Judgment Currency

  	
  52

  
	
   

  	
  Section 14.15.

  	
  Waiver of Immunity

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XV.

  	
  SUBORDINATION OF DEBENTURES

  	
  53

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 15.1.

  	
  Agreement to Subordinate

  	
  53

  
					

 

iii

 

	
   

  	
  Section 15.2.

  	
  Default on Senior Indebtedness

  	
  53

  
	
   

  	
  Section 15.3.

  	
  Liquidation, Dissolution, Bankruptcy

  	
  53

  
	
   

  	
  Section 15.4.

  	
  Subrogation

  	
  55

  
	
   

  	
  Section 15.5.

  	
  Trustee to Effectuate Subordination

  	
  55

  
	
   

  	
  Section 15.6.

  	
  Notice by the Company

  	
  56

  
	
   

  	
  Section 15.7.

  	
  Rights of the Trustee; Holders of Senior
  Indebtedness

  	
  56

  
	
   

  	
  Section 15.8.

  	
  Subordination May Not Be Impaired

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  Form of Junior
  Subordinated Deferrable Interest Debenture

  	
   

  
					

 

iv

 

THIS INDENTURE, dated as of
October 29, 2003, between American Capital Access Holdings Limited, a Bermuda
corporation (the “Company”), and U.S. Bank National Association, a
national banking association organized under the laws of the United States of
America, as debenture trustee (the “Trustee”).

 

WITNESSETH:

 

WHEREAS, for its lawful
corporate purposes, the Company has duly authorized the issuance of its
Floating Rate Junior Subordinated Deferrable Interest Debentures due 2033 (the “Debentures”)
under this Indenture to provide, among other things, for the execution and
authentication, delivery and administration thereof, and the Company has duly
authorized the execution of this Indenture; and

 

WHEREAS, all acts and things
necessary to make this Indenture a valid agreement according to its terms, have
been done and performed;

 

NOW, THEREFORE, in
consideration of the premises, and the purchase of the Debentures by the
holders thereof, the Company covenants and agrees with the Trustee for the
equal and proportionate benefit of the respective holders from time to time of
the Debentures as follows:

 

ARTICLE I.

DEFINITIONS

 

Section 1.1.           Definitions.  The terms defined in this
Section 1.1 (except as herein otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Indenture and of any
indenture supplemental hereto shall have the respective meanings specified in
this Section 1.1.  All accounting
terms used herein and not expressly defined shall have the meanings assigned to
such terms in accordance with generally accepted accounting principles and the
term “generally accepted accounting principles” means such accounting
principles as are generally accepted in the United States at the time of any
computation.  The words “herein,” “hereof”
and “hereunder” and other words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or other subdivision.

 

“Additional Interest”
has the meaning set forth in Section 2.11.

 

“Additional Junior
Indebtedness” means, without duplication and other than the Debentures, (a)
any indebtedness, liabilities or obligations of the Company, or any Subsidiary
of the Company, under debt securities (or guarantees in respect of debt
securities) issued to any trust, or a trustee of a trust, partnership or other
entity affiliated with the Company that is, directly or indirectly, a finance
subsidiary (as such term is defined in Rule 3a-5 under the Investment Company
Act of 1940) or other financing vehicle of the Company or any Subsidiary of the
Company in connection with the issuance by that entity of preferred securities
or (b) other securities that are issued either junior and subordinate to or on
a pari passu basis with the
Debentures.

 

“Additional Sums” has
the meaning set forth in Section 3.6.

 

1

 

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

 

“Authenticating Agent”
means any agent or agents of the Trustee which at the time shall be appointed
and acting pursuant to Section 6.12.

 

“Bankruptcy Law”
means Title 11, U.S. Code, or any similar federal or state law for the
relief of debtors.

 

“Board of Directors”
means the board of directors or the executive committee or any other duly
authorized designated officers of the Company.

 

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

 

“Business Day” means
any day other than a Saturday, Sunday or any other day on which banking
institutions in New York City or Hartford, Connecticut are permitted or
required by any applicable law to close.

 

“Capital Securities”
means undivided beneficial interests in the assets of the Trust which rank pari  passu with
Common Securities issued by the Trust; provided, however, that
upon the occurrence and during the continuation of an Event of Default (as
defined in the Declaration), the rights of holders of such Common Securities to
payment in respect of distributions and payments upon liquidation, redemption
and otherwise are subordinated to the rights of holders of such Capital
Securities.

 

“Capital Securities
Guarantee” means the guarantee agreement that the Company enters into with
U.S. Bank National Association, as guarantee trustee, or other Persons that
operates directly or indirectly for the benefit of holders of Capital
Securities of the Trust.

 

“Certificate” means a
certificate signed by any one of the principal executive officer, the principal
financial officer or the principal accounting officer of the Company.

 

“Common Securities”
means undivided beneficial interests in the assets of the Trust which rank pari passu with Capital Securities issued by the Trust; provided,
however, that upon the occurrence and during the continuation of an
Event of Default (as defined in the Declaration), the rights of holders of such
Common Securities to payment in respect of distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights of holders
of such Capital Securities.

 

“Company” means
American Capital Access Holdings Limited, a Bermuda corporation, and, subject
to the provisions of Article XI, shall include its successors and assigns.

 

“Coupon Rate” has the
meaning set forth in Section 2.8.

 

“Debenture” or “Debentures”
has the meaning stated in the first recital of this Indenture.

 

2

 

“Debenture Register”
has the meaning specified in Section 2.5.

 

“Declaration” means
the Amended and Restated Declaration of Trust of the Trust, as amended or
supplemented from time to time.

 

“Default” means any
event, act or condition that with notice or lapse of time, or both, would
constitute an Event of Default.

 

“Defaulted Interest”
has the meaning set forth in Section 2.8.

 

“Determination Date”
has the meaning set forth in Section 2.10.

 

“Distribution Period”
has the meaning set forth in Section 2.8.

 

“Event of Default”
means any event specified in Section 5.1, continued for the period of
time, if any, and after the giving of the notice, if any, therein designated.

 

“Extension Period”
has the meaning set forth in Section 2.11.

 

“Indenture” means
this instrument as originally executed or, if amended or supplemented as herein
provided, as so amended or supplemented, or both.

 

“Institutional Trustee”
has the meaning set forth in the Declaration.

 

“Interest Payment Date”
means each January 29, April 29, July 29 and October 29 during the term of this
Indenture.

 

“Interest Rate” means
for the period beginning on (and including) the date of original issuance and
ending on (but excluding) January 29, 2004 the rate per annum of 5.110% and for
each Distribution Period thereafter, the Coupon Rate.

 

“Investment Company Event”
means the receipt by the Company and the Trust of an opinion of counsel
experienced in such matters to the effect that, as a result of the occurrence
of a change in law or regulation or written change (including any announced
prospective change) in interpretation or application of law or regulation by
any legislative body, court, governmental agency or regulatory authority, there
is more than an insubstantial risk that the Trust is or, within 90 days of the
date of such opinion will be considered an “investment company” that is
required to be registered under the Investment Company Act of 1940, as amended
which change or prospective change becomes effective or would become effective,
as the case may be, on or after the date of the issuance of the Debentures.

 

“Liquidation Amount”
means the stated amount of $1,000.00 per Trust Security.

 

“Maturity Date” means
October 29, 2033.

 

“Officers’ Certificate”
means a certificate signed by the Chief Executive Officer, the Vice Chairman,
the President, any Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company, and
delivered to the Trustee.  Each such

 

3

 

certificate shall include
the statements provided for in Section 14.6 if and to the extent required
by the provisions of such Section.

 

“Opinion of Counsel”
means an opinion in writing signed by legal counsel, who may be an employee of
or counsel to the Company, or may be other counsel reasonably satisfactory to
the Trustee.  Each such opinion shall
include the statements provided for in Section 14.6 if and to the extent
required by the provisions of such Section.

 

“Optional Redemption Date”
has the meaning set forth in Section 10.1. 

 

“Optional Redemption
Price” means 100% of the principal amount of the Debentures being redeemed,
plus accrued and unpaid interest (including any Additional Interest) on such
Debentures to the Optional Redemption Date.

 

The term “outstanding,”
when used with reference to Debentures, means, subject to the provisions of
Section 7.4, as of any particular time, all Debentures authenticated and
delivered by the Trustee or the Authenticating Agent under this Indenture,
except:

 

(a)           Debentures
theretofore canceled by the Trustee or the Authenticating Agent or delivered to
the Trustee for cancellation;

 

(b)           Debentures, or
portions thereof, for the payment or redemption of which moneys in the
necessary amount shall have been deposited in trust with the Trustee or with
any paying agent (other than the Company) or shall have been set aside and
segregated in trust by the Company (if the Company shall act as its own paying
agent); provided, however, that, if such Debentures, or portions
thereof, are to be redeemed prior to maturity thereof, notice of such
redemption shall have been given as provided in Section 10.3 or provision
satisfactory to the Trustee shall have been made for giving such notice; and

 

(c)           Debentures paid
pursuant to Section 2.6 or in lieu of or in substitution for which other
Debentures shall have been authenticated and delivered pursuant to the terms of
Section 2.6 unless proof satisfactory to the Company and the Trustee is
presented that any such Debentures are held by bona fide holders in due course.

 

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

 

“Predecessor Security”
of any particular Debenture means every previous Debenture evidencing all or a
portion of the same debt as that evidenced by such particular Debenture; and,
for purposes of this definition, any Debenture authenticated and delivered
under Section 2.6 in lieu of a lost, destroyed or stolen Debenture shall be
deemed to evidence the same debt as the lost, destroyed or stolen Debenture.

 

“Principal Office of the
Trustee,” or other similar term, means the office of the Trustee, at which
at any particular time its corporate trust business shall be principally
administered, which at the time of the execution of this Indenture shall be 225
Asylum Street, Goodwin Square, Hartford, Connecticut 06103.

 

4

 

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

 

“Securities Act”
means the Securities Act of 1933, as amended from time to time or any successor
legislation.

 

“Securityholder,” “holder
of Debentures,” or other similar terms, means any Person in whose name at the
time a particular Debenture is registered on the register kept by the Company
or the Trustee for that purpose in accordance with the terms hereof.

 

“Senior Indebtedness”
means, with respect to the Company, (i) the principal, premium, if any,
and interest in respect of (A) indebtedness of the Company for money
borrowed and (B) indebtedness evidenced by securities, debentures, notes,
bonds or other similar instruments issued by the Company; (ii) all capital
lease obligations of the Company; (iii) all obligations of the Company
issued or assumed as the deferred purchase price of property, all conditional
sale obligations of the Company and all obligations of the Company under any
title retention agreement; (iv) all obligations of the Company for the
reimbursement of any letter of credit, any banker’s acceptance, any security
purchase facility, any repurchase agreement or similar arrangement, any
interest rate swap, any other hedging arrangement, any obligation under options
or any similar credit or other transaction; (v) all obligations of the
type referred to in clauses (i) through (iv) above of other Persons for
the payment of which the Company is responsible or liable as obligor, guarantor
or otherwise; and (vi) all obligations of the type referred to in
clauses (i) through (v) above of other Persons secured by any lien on any
property or asset of the Company (whether or not such obligation is assumed by
the Company), whether incurred on or prior to the date of this Indenture or
thereafter incurred.  Notwithstanding the
foregoing, “Senior Indebtedness” shall not include (1) any Additional
Junior Indebtedness, (2) Debentures issued pursuant to this Indenture and
guarantees in respect of such Debentures, (3) trade accounts payable of the
Company arising in the ordinary course of business (such trade accounts payable
being pari passu in right of payment to the
Debentures), or (4) obligations with respect to which (a) in the instrument
creating or evidencing the same or pursuant to which the same is outstanding,
it is provided that such obligations are pari passu,
junior or otherwise not superior in right of payment to the Debentures and (b)
the Company, prior to the issuance thereof, has, if required, notified the
relevant state insurance regulatory agency. 
Senior Indebtedness shall continue to be Senior Indebtedness and be
entitled to the subordination provisions irrespective of any amendment, modification
or waiver of any term of such Senior Indebtedness.

 

“Special Event” means
either of an Investment Company Event or a Tax Event.

 

“Special Redemption Date”
has the meaning set forth in Section 10.2.

 

5

 

“Special Redemption Price”
means (i) 107.5% of the principal amount of the Debentures being redeemed
on a Special Redemption Date that occurs before October 29, 2008 and (ii) 100%
of the principal amount of the Debentures being redeemed on a Special Redemption
Date that occurs on October 29, 2008 or after, plus accrued and unpaid interest
(including any Additional Interest) on such Debentures to the Special
Redemption Date.

 

“Subsidiary” means
with respect to any Person, (i) any corporation at least a majority of the
outstanding voting stock of which is owned, directly or indirectly, by such
Person or by one or more of its Subsidiaries, or by such Person and one or more
of its Subsidiaries, (ii) any general partnership, joint venture or
similar entity, at least a majority of the outstanding partnership or similar
interests of which shall at the time be owned by such Person, or by one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries and
(iii) any limited partnership of which such Person or any of its
Subsidiaries is a general partner.  For
the purposes of this definition, “voting stock” means shares, interests,
participations or other equivalents in the equity interest (however designated)
in such Person having ordinary voting power for the election of a majority of
the directors (or the equivalent) of such Person, other than shares, interests,
participations or other equivalents having such power only by reason of the
occurrence of a contingency.

 

“Tax Event” means the
receipt by the Company and the Trust of an opinion of counsel experienced in
such matters to the effect that, as a result of any amendment to or change
(including any announced prospective change) in the laws or any regulations
thereunder of the United States or any political subdivision or taxing
authority thereof or therein, or as a result of any official administrative
pronouncement (including any private letter ruling, technical advice
memorandum, field service advice, regulatory procedure, notice or announcement,
including any notice or announcement of intent to adopt such procedures or
regulations (an “Administrative Action”)) or judicial decision
interpreting or applying such laws or regulations, regardless of whether such
Administrative Action or judicial decision is issued to or in connection with a
proceeding involving the Company or the Trust and whether or not subject to
review or appeal, which amendment, clarification, change, Administrative Action
or decision is enacted, promulgated or announced, in each case on or after the
date of original issuance of the Debentures, there is more than an
insubstantial risk that:  (i) the
Trust is, or will be within 90 days of the date of such opinion, subject
to United States federal income tax with respect to income received or accrued
on the Debentures; (ii) interest payable by the Company on the Debentures
is not, or within 90 days of the date of such opinion, will not be,
deductible by the Company, in whole or in part, for United States federal income
tax purposes; or (iii) the Trust is, or will be within 90 days of the
date of such opinion, subject to more than a de minimis amount of other taxes
(excluding withholding taxes), duties or other governmental charges.

 

“Telerate Page 3750”
has the meaning set forth in Section 2.10.

 

“3-Month LIBOR” has
the meaning set forth in Section 2.10.

 

“Trust” shall mean
ACA Statutory Trust III, a Connecticut statutory trust, or any other similar
trust created for the purpose of issuing Capital Securities in connection with
the issuance of Debentures under this Indenture, of which ACA Financial Assets,
L.L.C., a Delaware limited liability company, which is a wholly-owned
subsidiary of the Company, is the sponsor.

 

6

 

“Trustee” means U.S.
Bank National Association, and, subject to the provisions of Article VI
hereof, shall also include its successors and assigns as Trustee hereunder.

 

“Trust Securities”
means Common Securities and Capital Securities of the Trust.

 

ARTICLE II.

DEBENTURES

 

Section 2.1.           Authentication and Dating.  Upon the execution and delivery of this
Indenture, or from time to time thereafter, Debentures in an aggregate
principal amount not in excess of $20,619,000.00 may be executed and delivered
by the Company to the Trustee for authentication, and the Trustee shall
thereupon authenticate and make available for delivery said Debentures to or
upon the written order of the Company, signed by its Chief Executive Officer,
the President, or one of its Vice Presidents without any further action by the
Company hereunder.  In authenticating
such Debentures, and accepting the additional responsibilities under this
Indenture in relation to such Debentures, the Trustee shall be entitled to
receive, and (subject to Section 6.1) shall be fully protected in relying
upon:

 

(a)           a copy of
any Board Resolution or Board Resolutions relating thereto and, if applicable,
an appropriate record of any action taken pursuant to such resolution, in each
case certified by the Secretary or an Assistant Secretary of the Company, as
the case may be; and

 

(b)           an Opinion
of Counsel prepared in accordance with Section 14.6 which shall also
state:

 

(1)  that such Debentures, when authenticated and
delivered by the Trustee and issued by the Company in each case in the manner
and subject to any conditions specified in such Opinion of Counsel, will
constitute valid and legally binding obligations of the Company, subject to or
limited by applicable bankruptcy, insolvency, reorganization, conservatorship,
receivership, moratorium and other statutory or decisional laws relating to or
affecting creditors’ rights or the reorganization of financial institutions
(including, without limitation, preference and fraudulent conveyance or
transfer laws), heretofore or hereafter enacted or in effect, affecting the
rights of creditors generally; and

 

(2)  that all laws and requirements in respect of
the execution and delivery by the Company of the Debentures have been complied
with and that authentication and delivery of the Debentures by the Trustee will
not violate the terms of this Indenture.

 

The Trustee shall have the right to decline to
authenticate and deliver any Debentures under this Section if the Trustee,
being advised in writing by counsel, determines that such action may not
lawfully be taken or if a Responsible Officer of the Trustee in good faith
shall determine that such action would expose the Trustee to personal liability
to existing holders.

 

The definitive Debentures shall be typed, printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers executing such Debentures, as
evidenced by their execution of such Debentures.

 

7

 

Section 2.2.           Form of Trustee’s Certificate of
Authentication.  The
Trustee’s certificate of authentication on all Debentures shall be in
substantially the following form:

 

This is one of the
Debentures referred to in the within-mentioned Indenture.

 

U.S. Bank National Association,
as Trustee

 

	
  By

  	
   

  	
   

  
	
  Authorized Signer

  

 

Section 2.3.           Form and Denomination of Debentures.  The Debentures shall be substantially in the
form of Exhibit A attached hereto.  The
Debentures shall be in registered, certificated form without coupons and in
minimum denominations of $100,000.00 and any multiple of $1,000.00 in excess
thereof.  Any attempted transfer of the
Debentures in a block having an aggregate principal amount of less than
$100,000.00 shall be deemed to be void and of no legal effect whatsoever.  Any such purported transferee shall be deemed
not to be a holder of such Debentures for any purpose, including, but not
limited to the receipt of payments on such Debentures, and such purported
transferee shall be deemed to have no interest whatsoever in such
Debentures.  The Debentures shall be
numbered, lettered, or otherwise distinguished in such manner or in accordance
with such plans as the officers executing the same may determine with the
approval of the Trustee as evidenced by the execution and authentication
thereof.

 

Section 2.4.           Execution of Debentures.  The Debentures shall be signed in the name
and on behalf of the Company by the manual or facsimile signature of its Chief
Executive Officer, President, or one of its Executive Vice Presidents, Senior
Vice Presidents or Vice Presidents.  Only
such Debentures as shall bear thereon a certificate of authentication
substantially in the form herein before recited, executed by the Trustee or the
Authenticating Agent by the manual signature of an authorized signer, shall be
entitled to the benefits of this Indenture or be valid or obligatory for any
purpose.  Such certificate by the Trustee
or the Authenticating Agent upon any Debenture executed by the Company shall be
conclusive evidence that the Debenture so authenticated has been duly
authenticated and delivered hereunder and that the holder is entitled to the
benefits of this Indenture.

 

In case any officer of the Company who shall have
signed any of the Debentures shall cease to be such officer before the
Debentures so signed shall have been authenticated and delivered by the Trustee
or the Authenticating Agent, or disposed of by the Company, such Debentures
nevertheless may be authenticated and delivered or disposed of as though the
Person who signed such Debentures had not ceased to be such officer of the
Company; and any Debenture may be signed on behalf of the Company by such
Persons as, at the actual date of the execution of such Debenture, shall be the
proper officers of the Company, although at the date of the execution of this
Indenture any such person was not such an officer.

 

Every Debenture shall be dated the date of its
authentication.

 

Section 2.5.           Exchange
and Registration of Transfer of Debentures.  The Company shall cause to be kept, at the
office or agency maintained for the purpose of registration of transfer and for
exchange as provided in Section 3.2, a register (the “Debenture
Register”) for the Debentures issued hereunder in which, subject to such
reasonable regulations as it may prescribe,

 

8

 

the Company shall
provide for the registration and transfer of all Debentures as in this
Article II provided.  The Debenture
Register shall be in written form or in any other form capable of being
converted into written form within a reasonable time.

 

Debentures to be exchanged
may be surrendered at the Principal Office of the Trustee or at any office or
agency to be maintained by the Company for such purpose as provided in
Section 3.2, and the Company shall execute, the Company or the Trustee
shall register and the Trustee or the Authenticating Agent shall authenticate
and make available for delivery in exchange therefor the Debenture or
Debentures which the Securityholder making the exchange shall be entitled to
receive.  Upon due presentment for
registration of transfer of any Debenture at the Principal Office of the
Trustee or at any office or agency of the Company maintained for such purpose
as provided in Section 3.2, the Company shall execute, the Company or the
Trustee shall register and the Trustee or the Authenticating Agent shall
authenticate and make available for delivery in the name of the transferee or
transferees a new Debenture for a like aggregate principal amount.  Registration or registration of transfer of
any Debenture by the Trustee or by any agent of the Company appointed pursuant
to Section 3.2, and delivery of such Debenture, shall be deemed to
complete the registration or registration of transfer of such Debenture.

 

All Debentures presented for
registration of transfer or for exchange or payment shall (if so required by
the Company or the Trustee or the Authenticating Agent) be duly endorsed by, or
be accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company and the Trustee or the Authenticating Agent duly
executed by the holder or his attorney duly authorized in writing.

 

No service charge shall be
made for any exchange or registration of transfer of Debentures, but the Company
or the Trustee may require payment of a sum sufficient to cover any tax, fee or
other governmental charge that may be imposed in connection therewith.

 

The Company or the Trustee
shall not be required to exchange or register a transfer of any Debenture for a
period of 15 days next preceding the date of selection of Debentures for
redemption.

 

Notwithstanding anything
herein to the contrary, Debentures may not be transferred except in compliance
with the restricted securities legend set forth below, unless otherwise
determined by the Company, upon the advice of counsel expert in securities law,
in accordance with applicable law:

 

THIS SECURITY HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW.  NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES
LAWS.  THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY
ONLY (A) TO THE COMPANY,

 

9

 

(B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN
ACCORDANCE WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE)
OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR
THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH THE INDENTURE, A COPY OF WHICH
MAY BE OBTAINED FROM THE COMPANY.

 

THE HOLDER OF THIS SECURITY
BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN
EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THE
SECURITIES OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE
FOR EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER
APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOT
PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH
RESPECT TO SUCH PURCHASE OR HOLDING.  ANY
PURCHASER OR HOLDER OF THE SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO
HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS
NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA,
OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR
OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER
PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO
FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT RESULT IN A PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE
FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

 

10

 

THIS SECURITY WILL BE ISSUED
AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN AGGREGATE PRINCIPAL AMOUNT OF
NOT LESS THAN $100,000.00 AND MULTIPLES OF $1,000.00 IN EXCESS THEREOF.  ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A
BLOCK HAVING AN AGGREGATE PRINCIPAL AMOUNT OF LESS THAN $100,000.00 SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.

 

THE HOLDER OF THIS SECURITY
AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.

 

THIS SECURITY IS IN
REGISTERED FORM WITHIN THE MEANING OF TREASURY REGULATIONS SECTION
1.871-14(c)(1)(i) FOR U.S. FEDERAL INCOME AND WITHHOLDING TAX PURPOSES.

 

IN CONNECTION WITH ANY
TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH
CERTIFICATE AND OTHER INFORMATION AS MAY BE REQUIRED BY THE INDENTURE TO
CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

Section 2.6.           Mutilated, Destroyed, Lost or Stolen
Debentures.  In case any
Debenture shall become mutilated or be destroyed, lost or stolen, the Company
shall execute, and upon its written request the Trustee shall authenticate and
deliver, a new Debenture bearing a number not contemporaneously outstanding, in
exchange and substitution for the mutilated Debenture, or in lieu of and in
substitution for the Debenture so destroyed, lost or stolen.  In every case the applicant for a substituted
Debenture shall furnish to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless, and, in
every case of destruction, loss or theft, the applicant shall also furnish to
the Company and the Trustee evidence to their satisfaction of the destruction,
loss or theft of such Debenture and of the ownership thereof.

 

The Trustee may authenticate
any such substituted Debenture and deliver the same upon the written request or
authorization of any officer of the Company. 
Upon the issuance of any substituted Debenture, the Company may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses connected
therewith.  In case any Debenture which
has matured or is about to mature or has been called for redemption in full
shall become mutilated or be destroyed, lost or stolen, the Company may,
instead of issuing a substitute Debenture, pay or authorize the payment of the
same (without surrender thereof except in the case of a mutilated Debenture) if
the applicant for such payment shall furnish to the Company and the Trustee
such security or indemnity as may be required by them to save each of them
harmless and, in case of destruction, loss or theft, evidence satisfactory to
the Company and to the Trustee of the destruction, loss or theft of such
Debenture and of the ownership thereof.

 

Every substituted Debenture
issued pursuant to the provisions of this Section 2.6 by virtue of the fact
that any such Debenture is destroyed, lost or stolen shall constitute an
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Debenture shall be found at any time, and shall be entitled to
all the benefits of this Indenture

 

11

 

equally and proportionately
with any and all other Debentures duly issued hereunder.  All Debentures shall be held and owned upon
the express condition that, to the extent permitted by applicable law, the
foregoing provisions are exclusive with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Debentures and shall preclude any and
all other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.

 

Section 2.7.           Temporary Debentures.  Pending the preparation of definitive
Debentures, the Company may execute and the Trustee shall authenticate and make
available for delivery temporary Debentures that are typed, printed or
lithographed.  Temporary Debentures shall
be issuable in any authorized denomination, and substantially in the form of
the definitive Debentures in lieu of which they are issued but with such
omissions, insertions and variations as may be appropriate for temporary
Debentures, all as may be determined by the Company.  Every such temporary Debenture shall be executed
by the Company and be authenticated by the Trustee upon the same conditions and
in substantially the same manner, and with the same effect, as the definitive
Debentures.  Without unreasonable delay
the Company will execute and deliver to the Trustee or the Authenticating Agent
definitive Debentures and thereupon any or all temporary Debentures may be
surrendered in exchange therefor, at the principal corporate trust office of
the Trustee or at any office or agency maintained by the Company for such
purpose as provided in Section 3.2, and the Trustee or the Authenticating
Agent shall authenticate and make available for delivery in exchange for such
temporary Debentures a like aggregate principal amount of such definitive
Debentures.  Such exchange shall be made
by the Company at its own expense and without any charge therefor except that
in case of any such exchange involving a registration of transfer the Company
may require payment of a sum sufficient to cover any tax, fee or other
governmental charge that may be imposed in relation thereto.  Until so exchanged, the temporary Debentures
shall in all respects be entitled to the same benefits under this Indenture as
definitive Debentures authenticated and delivered hereunder.

 

Section 2.8.           Payment of Interest and Additional Interest.  Interest at the Interest Rate and any
Additional Interest on any Debenture that is payable, and is punctually paid or
duly provided for, on any Interest Payment Date for Debentures shall be paid to
the Person in whose name said Debenture (or one or more Predecessor Securities)
is registered at the close of business on the regular record date for such
interest installment except that interest and any Additional Interest payable
on the Maturity Date shall be paid to the Person to whom principal is paid.  

 

Each Debenture shall bear
interest for the period beginning on (and including) the date of original
issuance and ending on (but excluding) January 29, 2004 at a rate per annum of
5.110%, and shall bear interest for each successive period beginning on (and
including) January 29, 2004, and each succeeding Interest Payment Date, and
ending on (but excluding) the next succeeding Interest Payment Date (each, a “Distribution
Period”) at a rate per annum equal to the 3-Month LIBOR, determined as
described in Section 2.10, plus 3.950% (the “Coupon Rate”); provided,
however, that prior to October 29, 2008, the Coupon Rate shall not
exceed 12.450%, applied to the principal amount thereof, until the principal
thereof becomes due and payable, and on any overdue principal and to the extent
that payment of such interest is enforceable under applicable law (without
duplication) on any overdue installment of interest (including Additional
Interest) at

 

12

 

the Interest Rate in effect
for each applicable period compounded quarterly.  Interest shall be payable (subject to any
relevant Extension Period) quarterly in arrears on each Interest Payment Date
with the first installment of interest to be paid on January 29, 2004.

 

Any interest on any
Debenture, including Additional Interest, that is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called “Defaulted Interest”) shall forthwith cease to be payable to the
registered holder on the relevant regular record date by virtue of having been
such holder; and such Defaulted Interest shall be paid by the Company to the
Persons in whose names such Debentures (or their respective Predecessor
Securities) are registered at the close of business on a special record date
for the payment of such Defaulted Interest, which shall be fixed in the
following manner: the Company shall notify the Trustee in writing at least 25
days prior to the date of the proposed payment of the amount of Defaulted
Interest proposed to be paid on each such Debenture and the date of the
proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix a special
record date for the payment of such Defaulted Interest which shall not be more
than 15 nor less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment.  The Trustee shall
promptly notify the Company of such special record date and, in the name and at
the expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed, first
class postage prepaid, to each Securityholder at its address as it appears in
the Debenture Register, not less than 10 days prior to such special record
date.  Notice of the proposed payment of
such Defaulted Interest and the special record date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names such Debentures (or their respective Predecessor Securities) are
registered on such special record date and shall be no longer payable.

 

The Company may make payment
of any Defaulted Interest on any Debentures in any other lawful manner after
notice given by the Company to the Trustee of the proposed payment method; provided,
however, the Trustee in its sole discretion deems such payment method to
be practical.

 

Any interest (including
Additional Interest) scheduled to become payable on an Interest Payment Date
occurring during an Extension Period shall not be Defaulted Interest and shall
be payable on such other date as may be specified in the terms of such
Debentures.

 

The term “regular record
date” as used in this Section shall mean the close of business on the 15th
calendar day next preceding the applicable Interest Payment Date.

 

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

 

13

 

Section 2.9.           Cancellation of Debentures Paid, etc.  All Debentures surrendered for the purpose of
payment, redemption, exchange or registration of transfer, shall, if
surrendered to the Company or any paying agent, be surrendered to the Trustee
and promptly canceled by it, or, if surrendered to the Trustee or any
Authenticating Agent, shall be promptly canceled by it, and no Debentures shall
be issued in lieu thereof except as expressly permitted by any of the provisions
of this Indenture.  All Debentures
canceled by any Authenticating Agent shall be delivered to the Trustee.  The Trustee shall destroy all canceled
Debentures unless the Company otherwise directs the Trustee in writing.  If the Company shall acquire any of the
Debentures, however, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Debentures unless and
until the same are surrendered to the Trustee for cancellation.

 

Section 2.10.        Computation of Interest.  The amount of interest payable for the
Distribution Period commencing on January 29, 2004 and each succeeding
Distribution Period will be calculated by applying the Interest Rate to the
principal amount outstanding at the commencement of the Distribution Period and
multiplying each such amount by the actual number of days in the Distribution
Period concerned divided by 360.  In the
event that any date on which interest is payable on the Debentures is not a
Business Day, then payment of interest payable on such date shall be made on
the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment was originally payable.  All percentages resulting from any
calculations on the Debentures will be rounded, if necessary, to the nearest
one hundred-thousandth of a percentage point, with five one-millionths of a
percentage point rounded upward (e.g., 9.876545% (or .09876545) being rounded
to 9.87655% (or .0987655), and all dollar amounts used in or resulting from
such calculation will be rounded to the nearest cent (with one-half cent being
rounded upward)).

 

(a)           “3-Month
LIBOR” means the London interbank offered interest rate for three-month,
U.S. dollar deposits determined by the Trustee in the following order of
priority:

 

(1)           the rate (expressed as
a percentage per annum) for U.S. dollar deposits having a three-month maturity
that appears on Telerate Page 3750 as of 11:00 a.m. (London time) on
the related Determination Date (as defined below).  “Telerate Page 3750” means the display designated
as “Page 3750” on the Dow Jones Telerate Service or such other page as may
replace Page 3750 on that service or such other service or services as may
be nominated by the British Bankers’ Association as the information vendor for
the purpose of displaying London interbank offered rates for U.S. dollar
deposits;

 

(2)           if such
rate cannot be identified on the related Determination Date, the Trustee will
request the principal London offices of four leading banks in the London
interbank market to provide such banks’ offered quotations (expressed as
percentages per annum) to prime banks in the London interbank market for U.S.
dollar deposits having a three-month maturity as of 11:00 a.m. (London
time) on such Determination Date.  If at

 

14

 

least two
quotations are provided, 3-Month LIBOR will be the arithmetic mean of such
quotations;

 

(3)           if fewer
than two such quotations are provided as requested in clause (2) above,
the Trustee will request four major New York City banks to provide such banks’
offered quotations (expressed as percentages per annum) to leading European
banks for loans in U.S. dollars as of 11:00 a.m. (London time) on such
Determination Date.  If at least two such
quotations are provided, 3-Month LIBOR will be the arithmetic mean of such
quotations; and

 

(4)           if fewer
than two such quotations are provided as requested in clause (3) above, 3-Month
LIBOR will be a 3-Month LIBOR determined with respect to the Distribution
Period immediately preceding such current Distribution Period.

 

If the rate for U.S. dollar
deposits having a three-month maturity that initially appears on Telerate
Page 3750 as of 11:00 a.m. (London time) on the related Determination
Date is superseded on the Telerate Page 3750 by a corrected rate by
12:00 noon (London time) on such Determination Date, then the corrected
rate as so substituted on the applicable page will be the applicable 3-Month
LIBOR for such Determination Date.

 

(b)           The Interest Rate for
any Distribution Period will at no time be higher than the maximum rate then
permitted by New York law as the same may be modified by United States law.

 

(c)           “Determination
Date” means the date that is two London Banking Days (i.e., a business day
in which dealings in deposits in U.S. dollars are transacted in the London
interbank market) preceding the particular Distribution Period for which a
Coupon Rate is being determined.

 

(d)           The
Trustee shall notify the Company, the Institutional Trustee and any securities
exchange or interdealer quotation system on which the Capital Securities are
listed, of the Coupon Rate and the Determination Date for each Distribution
Period, in each case as soon as practicable after the determination thereof but
in no event later than the thirtieth (30th) day of the relevant Distribution
Period.  Failure to notify the Company,
the Institutional Trustee or any securities exchange or interdealer quotation
system, or any defect in said notice, shall not affect the obligation of the
Company to make payment on the Debentures at the applicable Coupon Rate.  Any error in the calculation of the Coupon
Rate by the Trustee may be corrected at any time by notice delivered as above
provided.  Upon the request of a holder
of a Debenture, the Trustee shall provide the Coupon Rate then in effect and,
if determined, the Coupon Rate for the next Distribution Period.

 

(e)           Subject to
the corrective rights set forth above, all certificates, communications,
opinions, determinations, calculations, quotations and decisions given,
expressed, made or obtained for the purposes of the provisions relating to the
payment and calculation of interest on the Debentures and distributions on the
Capital Securities by the Trustee or the Institutional Trustee will (in the
absence of willful default, bad faith and manifest error) be final, conclusive
and binding on the Trust, the Company and all of the holders of the Debentures
and the Capital

 

15

 

Securities, and no
liability shall (in the absence of willful default, bad faith or manifest
error) attach to the Trustee or the Institutional Trustee in connection with
the exercise or non-exercise by either of them of their respective powers,
duties and discretion.

 

Section 2.11.        Extension of Interest Payment Period.  So long as no Event of Default has occurred
and is continuing, the Company shall have the right, from time to time, and
without causing an Event of Default, to defer payments of interest on the
Debentures by extending the interest payment period on the Debentures at any
time and from time to time during the term of the Debentures, for up to
20 consecutive quarterly periods (each such extended interest payment
period, an “Extension Period”), during which Extension Period no
interest (including Additional Interest) shall be due and payable (except any
Additional Sums that may be due and payable). 
No Extension Period may end on a date other than an Interest Payment
Date.  During an Extension Period,
interest will continue to accrue on the Debentures, and interest on such
accrued interest will accrue at an annual rate equal to the Interest Rate in
effect for such Extension Period, compounded quarterly from the date such
interest would have been payable were it not for the Extension Period, to the
extent permitted by law (such interest referred to herein as “Additional
Interest”).  At the end of any such
Extension Period the Company shall pay all interest then accrued and unpaid on
the Debentures (together with Additional Interest thereon); provided, however,
that no Extension Period may extend beyond the Maturity Date; provided  further,
however, that during any such Extension Period, the Company shall not
and shall not permit any Affiliate of the Company controlled by the Company to
(i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of the Company’s or
such Affiliate’s capital stock (other than payments of dividends or
distributions to the Company or a Subsidiary of the Company) or make any
guarantee payments with respect to the foregoing; or (ii) make any payment
of principal of or interest or premium, if any, on or repay, repurchase or
redeem any debt securities of the Company or any Affiliate of the Company controlled
by the Company that rank pari passu in
all respects with or junior in interest to the Debentures (other than, with
respect to clauses (i) and (ii) above, (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Company or any Subsidiary
of the Company in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of
capital stock of the Company or of such Subsidiary (or securities convertible
into or exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as
a result of any exchange or conversion of any class or series of the Company’s
capital stock (or any capital stock of a Subsidiary of the Company) for any
class or series of the Company’s capital stock (or in the case of a Subsidiary
of the Company, any class or series of such Subsidiary’s capital stock) or of
any class or series of the Company’s indebtedness for any class or series of
the Company’s capital stock (or in the case of indebtedness of a Subsidiary of
the Company, of any class or series of such Subsidiary’s indebtedness for any
class or series of such Subsidiary’s capital stock), (c) the purchase of
fractional interests in shares of the Company’s capital stock (or the capital
stock of a Subsidiary of the Company) pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any stockholders’
rights plan, or the issuance of rights, stock or other property under any
stockholders’ rights plan, or the redemption or repurchase of rights pursuant
thereto, (e) any dividend in the form of stock,

 

16

 

warrants, options
or other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with
or junior to such stock and any cash payments in lieu of fractional shares
issued in connection therewith, or (f) payments under the Capital
Securities Guarantee).  Prior to the
termination of any Extension Period, the Company may further extend such
period, provided that such period together with all such previous and further
consecutive extensions thereof shall not exceed 20 consecutive quarterly
periods, or extend beyond the Maturity Date. 
Upon the termination of any Extension Period and upon the payment of all
accrued and unpaid interest and Additional Interest, the Company may commence a
new Extension Period, subject to the foregoing requirements.  No interest or Additional Interest shall be
due and payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
an Extension Period shall bear Additional Interest to the extent permitted by
applicable law.  The Company must give
the Trustee notice of its election to begin or extend an Extension Period at
least 5 Business Days prior to the regular record date (as such term is used in
Section 2.8) immediately preceding the Interest Payment Date with respect to
which interest on the Debentures would have been payable except for the
election to begin or extend an Extension Period.  The Trustee shall give notice of the Company’s
election to begin a new Extension Period to the Securityholders.

 

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

 

ARTICLE III.

PARTICULAR COVENANTS OF THE COMPANY

 

Section 3.1.           Payment of Principal, Premium and Interest;
Agreed Treatment of the Debentures.

 

(a)           The
Company covenants and agrees that it will duly and punctually pay or cause to be
paid the principal of and premium, if any, and interest and any Additional
Interest and other payments on the Debentures at the place, at the respective
times and in the manner provided in this Indenture and the Debentures. Each
installment of interest on the Debentures may be paid (i) by mailing
checks for such interest payable to the order of the holders of Debentures
entitled thereto as they appear on the registry books of the Company if a
request for a wire transfer has not been received by the Company or
(ii) by wire transfer to any account with a banking institution located in
the United States designated in writing by such Person to the paying agent no
later than the related record date. 
Notwithstanding the foregoing, so long as the holder of this Debenture
is the Institutional Trustee, the payment of the principal of and interest on
this Debenture will be made in immediately available funds at such place and to
such account as may be designated by the Institutional Trustee.

 

17

 

(b)           The
Company will treat the Debentures as indebtedness of the Company that is in
registered form within the meaning of Treasury Regulations Section
1.871-14(c)(1)(i).  The Company will
further treat the amounts payable in respect of the principal amount of such
Debentures as interest for all United States federal income and withholding tax
purposes.  All interest payments in
respect of such Debentures will be made free and clear of United States
withholding tax to any beneficial owner thereof that has provided an Internal
Revenue Service Form W-8 BEN (or any substitute or successor form) establishing
its non-United States status for United States federal income and withholding
tax purposes.

 

(c)           As of the
date of this Indenture, the Company has no present intention to exercise its
right under Section 2.11 to defer payments of interest on the Debentures by
commencing an Extension Period.

 

(d)           As of the
date of this Indenture, the Company believes that the likelihood that it would
exercise its right under Section 2.11 to defer payments of interest on the
Debentures by commencing an Extension Period at any time during which the
Debentures are outstanding is remote because of the restrictions that would be
imposed on the Company’s ability to declare or pay dividends or distributions
on, or to redeem, purchase or make a liquidation payment with respect to, any
of its outstanding equity and on the Company’s ability to make any payments of
principal of or interest on, or repurchase or redeem, any of its debt
securities that rank pari passu in
all respects with (or junior in interest to) the Debentures.

 

Section 3.2.           Offices for Notices and Payments, etc.  So
long as any of the Debentures remain outstanding, the Company will maintain in
Hartford, Connecticut, an office or agency where the Debentures may be
presented for payment, an office or agency where the Debentures may be
presented for registration of transfer and for exchange as in this Indenture
provided and an office or agency where notices and demands to or upon the
Company in respect of the Debentures or of this Indenture may be served.  The Company will give to the Trustee written
notice of the location of any such office or agency and of any change of
location thereof.  Until otherwise
designated from time to time by the Company in a notice to the Trustee, or
specified as contemplated by Section 2.5, such office or agency for all of the
above purposes shall be the office or agency of the Trustee.  In case the Company shall fail to maintain
any such office or agency in Hartford, Connecticut, or shall fail to give such
notice of the location or of any change in the location thereof, presentations
and demands may be made and notices may be served at the Principal Office of
the Trustee.

 

In addition to any such
office or agency, the Company may from time to time designate one or more
offices or agencies outside Hartford, Connecticut, where the Debentures may be
presented for registration of transfer and for exchange in the manner provided
in this Indenture, and the Company may from time to time rescind such
designation, as the Company may deem desirable or expedient; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain any such office or agency in Hartford,
Connecticut, for the purposes above mentioned. 
The Company will give to the Trustee prompt written notice of any such
designation or rescission thereof.

 

18

 

Section 3.3.           Appointments to Fill Vacancies in Trustee’s
Office.  The Company,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will
appoint, in the manner provided in Section 6.9, a Trustee, so that there
shall at all times be a Trustee hereunder.

 

Section 3.4.           Provision as to Paying Agent.

 

(a)           If the
Company shall appoint a paying agent other than the Trustee, it will cause such
paying agent to execute and deliver to the Trustee an instrument in which such
agent shall agree with the Trustee, subject to the provision of this
Section 3.4,

 

(1)            that it will
hold all sums held by it as such agent for the payment of the principal of and
premium, if any, or interest, if any, on the Debentures (whether such sums have
been paid to it by the Company or by any other obligor on the Debentures) in
trust for the benefit of the holders of the Debentures;

 

(2)            that it will
give the Trustee prompt written notice of any failure by the Company (or by any
other obligor on the Debentures) to make any payment of the principal of and
premium, if any, or interest, if any, on the Debentures when the same shall be
due and payable; and

 

(3)            that it will,
at any time during the continuance of any Event of Default, upon the written
request of the Trustee, forthwith pay to the Trustee all sums so held in trust
by such paying agent.

 

(b)           If the
Company shall act as its own paying agent, it will, on or before each due date
of the principal of and premium, if any, or interest or other payments, if any,
on the Debentures, set aside, segregate and hold in trust for the benefit of
the holders of the Debentures a sum sufficient to pay such principal, premium,
interest or other payments so becoming due and will notify the Trustee in
writing of any failure to take such action and of any failure by the Company
(or by any other obligor under the Debentures) to make any payment of the
principal of and premium, if any, or interest or other payments, if any, on the
Debentures when the same shall become due and payable.

 

Whenever the Company shall
have one or more paying agents for the Debentures, it will, on or prior to each
due date of the principal of and premium, if any, or interest, if any, on the
Debentures, deposit with a paying agent a sum sufficient to pay the principal,
premium, interest or other payments so becoming due, such sum to be held in
trust for the benefit of the Persons entitled thereto and (unless such paying
agent is the Trustee) the Company shall promptly notify the Trustee in writing
of its action or failure to act.

 

(c)           Anything
in this Section 3.4 to the contrary notwithstanding, the Company may, at
any time, for the purpose of obtaining a satisfaction and discharge with
respect to the Debentures, or for any other reason, pay, or direct any paying
agent to pay to the Trustee all sums held in trust by the Company or any such
paying agent, such sums to be held by the Trustee upon the trusts herein
contained.

 

(d)           Anything
in this Section 3.4 to the contrary notwithstanding, the agreement to hold
sums in trust as provided in this Section 3.4 is subject to
Sections 12.3 and 12.4.

 

19

 

Section 3.5.           Certificate to Trustee.  The Company will deliver to the Trustee on or
before 120 days after the end of each fiscal year, so long as Debentures
are outstanding hereunder, a Certificate stating that in the course of the
performance by the signers of their duties as officers of the Company they
would normally have knowledge of any default during such fiscal year by the
Company in the performance of any covenants contained herein, stating whether
or not they have knowledge of any such default and, if so, specifying each such
default of which the signers have knowledge and the nature and status thereof.

 

Section 3.6.           Additional Sums.  If and for so long as the Trust or a trustee
of the Trust is the holder of all Debentures and the Trust is required to pay
any additional taxes (excluding withholding taxes), duties, assessments or
other governmental charges as a result of a Tax Event, then the Company will
pay such additional amounts (“Additional Sums”) on the Debentures as
shall be required so that the net amounts received and retained by the Trust
after paying such taxes (excluding withholding taxes), duties, assessments or
other governmental charges will be equal to the amounts the Trust would have
received if no such taxes (excluding withholding taxes), duties, assessments or
other governmental charges had been imposed. 
Whenever in this Indenture or the Debentures there is a reference in any
context to the payment of principal of or interest on the Debentures, such
mention shall be deemed to include mention of payments of the Additional Sums
provided for in this paragraph to the extent that, in such context, Additional
Sums are, were or would be payable in respect thereof pursuant to the
provisions of this paragraph and express mention of the payment of Additional
Sums (if applicable) in any provisions hereof shall not be construed as
excluding Additional Sums in those provisions hereof where such express mention
is not made; provided, however, that the deferral of the payment
of interest during an Extension Period pursuant to Section 2.11 shall not
defer the payment of any Additional Sums that may be due and payable.

 

Section 3.7.           Compliance with Consolidation Provisions.  The Company will not, while any of the
Debentures remain outstanding, consolidate with, or merge into, or merge into
itself, or sell or convey all or substantially all of its property to any other
Person unless the provisions of Article XI hereof are complied with.

 

Section 3.8.           Limitation on Dividends.  If Debentures are initially issued to the
Trust or a trustee of such Trust in connection with the issuance of Trust
Securities by the Trust (regardless of whether Debentures continue to be held
by such Trust) and (i) there shall have occurred and be continuing an
Event of Default, (ii) the Company shall be in default with respect to its
payment of any obligations under the Capital Securities Guarantee, or (iii) the
Company shall have given notice of its election to defer payments of interest
on the Debentures by extending the interest payment period as provided herein
and such period, or any extension thereof, shall be continuing, then the
Company shall not, and shall not permit any Affiliate of the Company controlled
by the Company 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 Company’s or such Affiliates’ capital stock (other than payments of
dividends or distributions to the Company or a Subsidiary of the Company) or
make any guarantee payments with respect to the foregoing or (y) make any
payment of principal of or interest or premium, if any, on or repay, repurchase
or redeem any debt securities of the Company or any Affiliate of the Company
controlled by the Company that rank pari passu in
all respects with or junior in interest to the Debentures (other than, with
respect to clauses (x) and (y) above, (1) repurchases, redemptions

 

20

 

or other
acquisitions of shares of capital stock of the Company or any Subsidiary of the
Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Company or of such Subsidiary (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (2) as
a result of any exchange or conversion of any class or series of the Company’s
capital stock (or any capital stock of a Subsidiary of the Company) for any
class or series of the Company’s capital stock (or in the case of a Subsidiary
of the Company, any class or series of such Subsidiary’s capital stock) or of
any class or series of the Company’s indebtedness for any class or series of
the Company’s capital stock (or in the case of indebtedness of a Subsidiary of
the Company, of any class or series of such Subsidiary’s indebtedness for any
class or series of such Subsidiary’s capital stock), (3) the purchase of
fractional interests in shares of the Company’s capital stock (or the capital
stock of Subsidiary of the Company) pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(4) any declaration of a dividend in connection with any stockholders’
rights plan, or the issuance of rights, stock or other property under any
stockholders’ rights plan, or the redemption or repurchase of rights pursuant
thereto, (5) any dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with
or junior to such stock and any cash payments in lieu of fractional shares
issued in connection therewith, or (6) payments under the Capital
Securities Guarantee).

 

Section 3.9.           Covenants as to the Trust.  For so long as the Trust Securities remain
outstanding, the Company shall maintain 100% ownership of the Common
Securities; provided, however, that any permitted successor of
the Company under this Indenture may succeed to the Company’s ownership of such
Common Securities.  The Company, as owner
of the Common Securities, shall, except in connection with a distribution of
Debentures to the holders of Trust Securities in liquidation of the Trust, the
redemption of all of the Trust Securities or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration, cause the Trust (a) to
remain a statutory trust, (b) to otherwise continue to be classified as a
grantor trust for United States federal income tax purposes, and (c) to
cause each holder of Trust Securities to be treated as owning an undivided
beneficial interest in the Debentures.

 

Section 3.10.        Additional Junior Indebtedness.  The Company shall not, and it shall not
cause or permit any Subsidiary of the Company to, incur, issue or be obligated
on any Additional Junior Indebtedness issued after the date hereof, either
directly or indirectly, by way of guarantee, suretyship or otherwise, other
than Additional Junior Indebtedness that, by its terms, is expressly stated to
be either junior and subordinate or pari passu in
all respects to the Debentures.

 

Section 3.11.        Consent to Jurisdiction and Venue.  The
Company has validly and irrevocably submitted to the nonexclusive jurisdiction
of any New York Court (as defined in Section 14.13 of this Indenture)  with respect to suits, actions or proceedings
arising out of or in connection with violations of United States federal
securities laws relating to offers and sales of the Capital Securities, has
validly and irrevocably waived, to the fullest extent permitted by law,

 

21

 

any objections that it may now or hereafter have to the laying of venue
of any such suit, action or proceeding brought in any New York Court based on
or arising under this Agreement or any claims that any such suit, action or
proceeding brought in any New York Court has been brought in an inconvenient
forum, and has duly and irrevocably appointed Corporation Service Company in
Albany, New York as its agent to receive service of process with respect to
actions arising out of or in connection with any such suit, action or
proceeding; and service of process effected in the manner set forth in Section
14.13 of this Indenture will be effective under the laws of Bermuda to confer
personal jurisdiction over the Company.

 

ARTICLE IV.

SECURITYHOLDERS LISTS AND REPORTS

BY THE COMPANY AND THE TRUSTEE

 

Section 4.1.           Securityholders Lists.  The Company covenants and agrees that it will
furnish or cause to be furnished to the Trustee:

 

(a)           on each
regular record date for the Debentures, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Securityholders of the
Debentures as of such record date; and

 

(b)           at such
other times as the Trustee may request in writing, within 30 days after
the receipt by the Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished;

 

except
that no such lists need be furnished under this Section 4.1 so long as the
Trustee is in possession thereof by reason of its acting as Debenture
registrar.

 

Section 4.2.           Preservation and Disclosure of Lists.

 

(a)           The
Trustee shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the holders of Debentures
(1) contained in the most recent list furnished to it as provided in
Section 4.1 or (2) received by it in the capacity of Debentures
registrar (if so acting) hereunder.  The
Trustee may destroy any list furnished to it as provided in Section 4.1
upon receipt of a new list so furnished.

 

(b)           In case
three or more holders of Debentures (hereinafter referred to as “applicants”)
apply in writing to the Trustee and furnish to the Trustee reasonable proof
that each such applicant has owned a Debenture for a period of at least 6 months
preceding the date of such application, and such application states that the
applicants desire to communicate with other holders of Debentures with respect
to their rights under this Indenture or under such Debentures and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall within 5 Business Days
after the receipt of such application, at its election, either:

 

(1)            afford such
applicants access to the information preserved at the time by the Trustee in
accordance with the provisions of subsection (a) of this Section 4.2,
or

 

22

 

(2)            inform such
applicants as to the approximate number of holders of Debentures whose names
and addresses appear in the information preserved at the time by the Trustee in
accordance with the provisions of subsection (a) of this Section 4.2,
and as to the approximate cost of mailing to such Securityholders the form of
proxy or other communication, if any, specified in such application.

 

If the Trustee shall elect not to afford such
applicants access to such information, the Trustee shall, upon the written
request of such applicants, mail to each Securityholder whose name and address
appear in the information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 4.2 a copy of
the form of proxy or other communication which is specified in such request
with reasonable promptness after a tender to the Trustee of the material to be
mailed and of payment, or provision for the payment, of the reasonable expenses
of mailing, unless within five days after such tender, the Trustee shall mail
to such applicants and file with the Securities and Exchange Commission, if
permitted or required by applicable law, together with a copy of the material
to be mailed, a written statement to the effect that, in the opinion of the
Trustee, such mailing would be contrary to the best interests of the holders of
all Debentures, as the case may be, or would be in violation of applicable
law.  Such written statement shall
specify the basis of such opinion.  If
said Commission, as permitted or required by applicable law, after opportunity
for a hearing upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections or if, after
the entry of an order sustaining one or more of such objections, said
Commission shall find, after notice and opportunity for hearing, that all the objections
so sustained have been met and shall enter an order so declaring, the Trustee
shall mail copies of such material to all such Securityholders with reasonable
promptness after the entry of such order and the renewal of such tender;
otherwise the Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.

 

(c)           Each and
every holder of Debentures, by receiving and holding the same, agrees with
Company and the Trustee that neither the Company nor the Trustee nor any paying
agent shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the holders of Debentures in
accordance with the provisions of subsection (b) of this Section 4.2,
regardless of the source from which such information was derived, and that the
Trustee shall not be held accountable by reason of mailing any material
pursuant to a request made under said subsection (b).

 

ARTICLE V.

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS

UPON AN EVENT OF DEFAULT

 

Section 5.1.           Events of Default.  “Event
of Default,” wherever used herein, means any one of the following events
(whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

 

(a)           the
Company defaults in the payment of any interest upon any Debenture when it
becomes due and payable, and fails to cure such default for a period of
30 days; provided,

 

23

 

however,
that a valid extension of an interest payment period by the Company in
accordance with the terms of this Indenture shall not constitute a default in
the payment of interest for this purpose; or

 

(b)           the
Company defaults in the payment of all or any part of the principal of (or
premium, if any, on) any Debentures as and when the same shall become due and
payable either at maturity, upon redemption, by declaration of acceleration or
otherwise; or

 

(c)           the
Company defaults in the performance of, or breaches, any of its covenants or
agreements in this Indenture or in the terms of the Debentures established as
contemplated in this Indenture (other than a covenant or agreement a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with), and continuance of such default or breach for a period of
60 days after there has been given, by registered or certified mail, to
the Company by the Trustee or to the Company and the Trustee by the holders of
at least 25% in aggregate principal amount of the outstanding Debentures, a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a “Notice of Default” hereunder; or

 

(d)           a court of
competent jurisdiction shall enter a decree or order for relief in respect of
the Company in an involuntary case under any applicable bankruptcy, insolvency,
reorganization or other similar law now or hereafter in effect, or shall
appoint a receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of the Company or for any substantial part of its property,
or shall order the winding-up or liquidation of its affairs and such decree or
order shall remain unstayed and in effect for a period of 90 consecutive
days; or

 

(e)           the
Company shall commence a voluntary case under any applicable bankruptcy,
insolvency, reorganization or other similar law now or hereafter in effect, shall
consent to the entry of an order for relief in an involuntary case under any
such law, or shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian, sequestrator (or other
similar official) of the Company or of any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due; or

 

(f)            the Trust
shall have voluntarily or involuntarily liquidated, dissolved, wound-up its
business or otherwise terminated its existence except in connection with
(i) the distribution of the Debentures to holders of the Trust Securities
in liquidation of their interests in the Trust, (ii) the redemption of all
of the outstanding Trust Securities or (iii) certain mergers,
consolidations or amalgamations, each as permitted by the Declaration.

 

If an Event of Default occurs and is continuing with
respect to the Debentures, then, and in each and every such case, unless the
principal of the Debentures shall have already become due and payable, either
the Trustee or the holders of not less than 25% in aggregate principal amount
of the Debentures then outstanding hereunder, by notice in writing to the
Company (and to the Trustee if given by Securityholders), may declare the
entire principal of the Debentures and the interest accrued thereon, if any, to
be due and payable immediately, and upon any such declaration the same shall
become immediately due and payable.

 

24

 

The foregoing provisions,
however, are subject to the condition that if, at any time after the principal
of the Debentures shall have been so declared due and payable, and before any
judgment or decree for the payment of the moneys due shall have been obtained
or entered as hereinafter provided, (i) the Company shall pay or shall deposit
with the Trustee a sum sufficient to pay all matured installments of interest
upon all the Debentures and the principal of and premium, if any, on the
Debentures which shall have become due otherwise than by acceleration (with
interest upon such principal and premium, if any, and Additional Interest) and
such amount as shall be sufficient to cover reasonable compensation of the
Trustee and each predecessor Trustee, their respective agents, attorneys and
counsel, and all other amounts due to the Trustee pursuant to Section 6.6,
if any, and (ii) all Events of Default under this Indenture, other than the
non-payment of the principal of or premium, if any, on the Debentures which
shall have become due by acceleration, shall have been cured, waived or
otherwise remedied as provided herein — then and in every such case the
holders of a majority in aggregate principal amount of the Debentures then
outstanding, by written notice to the Company and to the Trustee, may waive all
defaults and rescind and annul such declaration and its consequences, but no
such waiver or rescission and annulment shall extend to or shall affect any
subsequent default or shall impair any right consequent thereon.

 

In case the Trustee shall
have proceeded to enforce any right under this Indenture and such proceedings
shall have been discontinued or abandoned because of such rescission or
annulment or for any other reason or shall have been determined adversely to
the Trustee, then and in every such case the Company, the Trustee and the
holders of the Debentures shall be restored respectively to their several
positions and rights hereunder, and all rights, remedies and powers of the
Company, the Trustee and the holders of the Debentures shall continue as though
no such proceeding had been taken.

 

Section 5.2.           Payment of Debentures on Default; Suit
Therefor.  The Company
covenants that upon the occurrence and during the continuation of an Event of
Default pursuant to Section 5.1(a) or Section 5.1(b) then, upon demand of the
Trustee, the Company will pay to the Trustee, for the benefit of the holders of
the Debentures the whole amount that then shall have become due and payable on
all Debentures for principal and premium, if any, or interest, or both, as the
case may be, with Additional Interest accrued on the Debentures (to the extent
that payment of such interest is enforceable under applicable law and, if the
Debentures are held by the Trust or a trustee of such Trust, without
duplication of any other amounts paid by the Trust or a trustee of the Trust in
respect thereof); and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and counsel, and
any other amounts due to the Trustee under Section 6.6.  In case the Company shall fail forthwith to
pay such amounts upon such demand, the Trustee, in its own name and as trustee
of an express trust, shall be entitled and empowered to institute any actions
or proceedings at law or in equity for the collection of the sums so due and
unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company
or any other obligor on such Debentures and collect in the manner provided by
law out of the property of the Company or any other obligor on such Debentures
wherever situated the moneys adjudged or decreed to be payable.

 

25

 

In case there shall be
pending proceedings for the bankruptcy or for the reorganization of the Company
or any other obligor on the Debentures under Bankruptcy Law, or in case a
receiver or trustee shall have been appointed for the property of the Company
or such other obligor, or in the case of any other similar judicial proceedings
relative to the Company or other obligor upon the Debentures, or to the
creditors or property of the Company or such other obligor, the Trustee,
irrespective of whether the principal of the Debentures shall then be due and
payable as therein expressed or by declaration of acceleration or otherwise and
irrespective of whether the Trustee shall have made any demand pursuant to the
provisions of this Section 5.2, shall be entitled and empowered, by
intervention in such proceedings or otherwise,

 

(a)           to file
and prove a claim or claims for the whole amount of principal and interest
owing and unpaid in respect of the Debentures, 

 

(b)           in case of
any judicial proceedings, to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for reasonable compensation to the Trustee and
each predecessor Trustee, and their respective agents, attorneys and counsel,
and for reimbursement of all other amounts due to the Trustee under
Section 6.6), and of the Securityholders allowed in such judicial
proceedings relative to the Company or any other obligor on the Debentures, or
to the creditors or property of the Company or such other obligor, unless
prohibited by applicable law and regulations, to vote on behalf of the holders
of the Debentures in any election of a trustee or a standby trustee in
arrangement, reorganization, liquidation or other bankruptcy or insolvency
proceedings or Person performing similar functions in comparable proceedings, 

 

(c)           to collect
and receive any moneys or other property payable or deliverable on any such
claims, and 

 

(d)           to
distribute the same after the deduction of its charges and expenses.

 

By
its acceptance of any Debentures, each Securityholder shall be deemed to have
authorized any receiver, assignee or trustee in bankruptcy or reorganization is
hereby authorized by each of the Securityholders to make such payments to the
Trustee, and, in the event that the Trustee shall consent to the making of such
payments directly to the Securityholders, to pay to the Trustee such amounts as
shall be sufficient to cover reasonable compensation to the Trustee, each
predecessor Trustee and their respective agents, attorneys and counsel, and all
other amounts due to the Trustee under Section 6.6.

 

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

 

All rights of action and of
asserting claims under this Indenture, or under any of the Debentures, may be
enforced by the Trustee without the possession of any of the Debentures, or the
production thereof at any trial or other proceeding relative thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express

 

26

 

trust, and any recovery of
judgment shall be for the ratable benefit of the holders of the Debentures.

 

In any proceedings brought
by the Trustee (and also any proceedings involving the interpretation of any
provision of this Indenture to which the Trustee shall be a party), the Trustee
shall be held to represent all the holders of the Debentures, and, subject to
Section 5.3, it shall not be necessary to make any holders of the Debentures
parties to any such proceedings.

 

Section 5.3.           Application of Moneys Collected by Trustee.  Any moneys collected by the Trustee pursuant
to this Article V shall be applied in the following order, at the date or
dates fixed by the Trustee for the distribution of such moneys, upon
presentation of the several Debentures in respect of which moneys have been
collected, and stamping thereon the payment, if only partially paid, and upon
surrender thereof if fully paid:

 

First:  To the payment of costs and expenses incurred
by, and reasonable fees of, the Trustee, its agents, attorneys and counsel, and
of all other amounts due to the Trustee under Section 6.6;

 

Second:  To the payment of all Senior Indebtedness of
the Company if and to the extent required by Article XV;

 

Third:  To the payment of the amounts then due and
unpaid upon the Debentures for principal (and premium, if any), and interest on
the Debentures, in respect of which or for the benefit of which money has been
collected, ratably, without preference or priority of any kind, according to
the amounts due on such Debentures for principal (and premium, if any) and
interest (including Additional Interest), respectively; and

 

Fourth:  The balance, if any, to the Company.

 

Section 5.4.           Proceedings by Securityholders.  No holder of any Debenture shall have any
right to institute any suit, action or proceeding for any remedy hereunder,
unless such holder previously shall have given to the Trustee written notice of
an Event of Default with respect to the Debentures and unless the holders of
not less than 25% in aggregate principal amount of the Debentures then
outstanding shall have given the Trustee a written request to institute such
action, suit or proceeding and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred thereby, and the Trustee for 60 days after its
receipt of such notice, request and offer of indemnity shall have failed to
institute any such action, suit or proceeding.

 

Notwithstanding any other
provisions in this Indenture, however, the right of any holder of any Debenture
to receive payment of the principal of, premium, if any, and interest, on such
Debenture when due, or to institute suit for the enforcement of any such
payment, shall not be impaired or affected without the consent of such holder and
by accepting a Debenture hereunder it is expressly understood, intended and
covenanted by the taker and holder of every Debenture with every other such
taker and holder and the Trustee, that no one or more holders of Debentures
shall have any right in any manner whatsoever by virtue or by availing itself
of any provision of this Indenture to affect, disturb or prejudice the rights
of the holders of any other Debentures, or to obtain or seek to obtain priority
over or preference to any other such holder, or

 

27

 

to enforce any right under
this Indenture, except in the manner herein provided and for the equal, ratable
and common benefit of all holders of Debentures.  For the protection and enforcement of the provisions
of this Section, each and every Securityholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.

 

Section 5.5.           Proceedings by Trustee.  In case of an Event of Default hereunder the
Trustee may in its discretion proceed to protect and enforce the rights vested
in it by this Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such rights, either by
suit in equity or by action at law or by proceeding in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in
this Indenture or in aid of the exercise of any power granted in this
Indenture, or to enforce any other legal or equitable right vested in the
Trustee by this Indenture or by law.

 

Section 5.6.           Remedies Cumulative and Continuing; Delay or
Omission Not a Waiver. 
Except as otherwise provided in Section 2.6 with respect to the
replacement of mutilated, destroyed, lost or stolen Debentures, all powers and
remedies given by this Article V to the Trustee or to the Securityholders
shall, to the extent permitted by law, be deemed cumulative and not exclusive
of any other powers and remedies available to the Trustee or the holders of the
Debentures, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture or
otherwise established with respect to the Debentures, and no delay or omission
of the Trustee or of any holder of any of the Debentures to exercise any right,
remedy or power accruing upon any Event of Default occurring and continuing as
aforesaid shall impair any such right, remedy or power, or shall be construed
to be a waiver of any such default or an acquiescence therein; and, subject to
the provisions of Section 5.4, every power and remedy given by this
Article V or by law to the Trustee or to the Securityholders may be
exercised from time to time, and as often as shall be deemed expedient, by the
Trustee (in accordance with its duties under Section 6.1) or by the
Securityholders.

 

No delay or omission of the
Trustee or any Securityholder to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver
of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article
or by law to the Trustee or to any Securityholder may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee (in accordance
with its duties under Section 6.1 hereof) or by such holder, as the case may
be.

 

Section 5.7.           Direction
of Proceedings and Waiver of Defaults by Majority of Securityholders.  The holders of a majority in aggregate
principal amount of the Debentures affected (voting as one class) at the time
outstanding shall have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with respect to such
Debentures; provided, however, that (subject to the provisions of
Section 6.1) the Trustee shall have the right to decline to follow any
such direction if the Trustee shall determine that the action so directed would
be unjustly prejudicial to the holders not taking part in such direction or if
the Trustee being advised by counsel determines that the action or proceeding
so directed may not lawfully

 

28

 

be taken or if a
Responsible Officer of the Trustee shall determine that the action or
proceedings so directed would involve the Trustee in personal liability.  

 

The holders of a majority in
aggregate principal amount of the Debentures at the time outstanding may on
behalf of the holders of all of the Debentures waive (or modify any previously
granted waiver of) any past default or Event of Default, and its consequences,
except an Event of Default (a) specified in Sections 5.1(a) and (b),
(b) in respect of covenants or provisions hereof which cannot be modified
or amended without the consent of the holder of each Debenture affected, or
(c) in respect of the covenants contained in Section 3.9; provided,
however, that if the Debentures are held by the Trust or the
Institutional Trustee, such waiver or modification to such waiver shall not be
effective until the holders of a majority in Liquidation Amount of the Trust
Securities shall have consented to such waiver or modification to such waiver, provided,
further, that if the consent of the holder of each outstanding Debenture
is required, such waiver shall not be effective until each holder of the Trust
Securities shall have consented to such waiver. 
Upon any such waiver, the default covered thereby shall be deemed to be
cured for all purposes of this Indenture and the Company, the Trustee and the
holders of the Debentures shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.  Whenever any default or Event
of Default hereunder shall have been waived as permitted by this Section, said
default or Event of Default shall for all purposes of the Debentures and this
Indenture be deemed to have been cured and to be not continuing.

 

Section 5.8.           Notice of Defaults.  The Trustee shall, within 90 days after
the actual knowledge by a Responsible Officer of the Trustee of the occurrence
of a default with respect to the Debentures, mail to all Securityholders, as
the names and addresses of such holders appear upon the Debenture Register,
notice of all defaults with respect to the Debentures known to the Trustee,
unless such defaults shall have been cured before the giving of such notice
(the term “defaults” for the purpose of this Section 5.8 being hereby
defined to be the events specified in clauses (a), (b), (c), (d), (e) and
(f) of Section 5.1, not including periods of grace, if any, provided for
therein); provided, however, that, except in the case of default
in the payment of the principal of, premium, if any, or interest on any of the
Debentures, the Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Securityholders.

 

Section 5.9.           Undertaking to Pay Costs.  All parties to this Indenture agree, and each
holder of any Debenture by his acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit,
and that such court may in its discretion assess reasonable costs, including
reasonable attorneys’ fees and expenses, against any party litigant in such
suit, having due regard to the merits and good faith of the claims or defenses
made by such party litigant; provided, however, that the
provisions of this Section 5.9 shall not apply to any suit instituted by
the Trustee, to any suit instituted by any Securityholder, or group of
Securityholders, holding in the aggregate more than 10% in principal amount of
the Debentures outstanding, or to any suit instituted by any Securityholder for
the enforcement of the payment of the principal of (or premium, if any) or
interest on any Debenture against the Company on or after the same shall have
become due and payable.

 

29

 

ARTICLE VI.

CONCERNING THE TRUSTEE

 

Section 6.1.           Duties and Responsibilities of Trustee.
With respect to the holders of Debentures issued hereunder, the Trustee, prior
to the occurrence of an Event of Default with respect to the Debentures and
after the curing or waiving of all Events of Default which may have
occurred, with respect to the Debentures, undertakes to perform such
duties and only such duties as are specifically set forth in this Indenture,
and no implied covenants shall be read into this Indenture against the Trustee.
In case an Event of Default with respect to the Debentures has occurred (which
has not been cured or waived), the Trustee shall exercise such of the rights
and powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.

 

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

 

(a)           prior
to the occurrence of an Event of Default with respect to Debentures and after
the curing or waiving of all Events of Default which may have occurred

 

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

 

(2)            in the absence
of bad faith on the part of the Trustee, the 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 Trustee
and conforming to the requirements of this Indenture; but, in the case of any
such certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Indenture;

 

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

 

(c)           the
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith, in accordance with the direction of the
Securityholders pursuant to Section 5.7, relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture.

 

30

 

None of the provisions
contained in this Indenture shall require the 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 there is
ground for believing that the repayment of such funds or liability is not
assured to it under the terms of this Indenture or indemnity satisfactory to
the Trustee against such risk is not reasonably assured to it.

 

Section 6.2.           Reliance on Documents, Opinions, etc. Except
as otherwise provided in Section 6.1:

 

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

 

(b)           any
request, direction, order or demand of the Company mentioned herein shall be
sufficiently evidenced by an Officers’ Certificate (unless other evidence in
respect thereof be herein specifically prescribed); and any Board Resolution may be
evidenced to the Trustee by a copy thereof certified by the Secretary or an
Assistant Secretary of the Company;

 

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

 

(d)           the
Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Indenture at the request, order or direction of any of the
Securityholders, pursuant to the provisions of this Indenture, unless such
Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be
incurred therein or thereby;

 

(e)           the
Trustee shall not be liable for any action taken or omitted by it in good faith
and believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an Event
of Default with respect to the Debentures (that has not been cured or waived)
to exercise with respect to Debentures such of the rights and powers vested in
it by this Indenture, and to use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs;

 

(f)            the
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, bond, debenture, coupon or other
paper or document, unless requested in writing to do so by the holders of not
less than a majority in aggregate principal amount of the outstanding
Debentures affected thereby; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expense or liability as a condition to so
proceeding;

 

31

 

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

 

(h)           with
the exceptions of defaults under Sections 5.1(a) or 5.1(b), the Trustee
shall not be charged with knowledge of any Default or Event of Default with
respect to the Debentures unless a written notice of such Default or Event of
Default shall have been given to the Trustee by the Company or any other
obligor on the Debentures or by any holder of the Debentures.

 

Section 6.3.           No Responsibility for Recitals, etc. The
recitals contained herein and in the Debentures (except in the certificate of
authentication of the Trustee or the Authenticating Agent) shall be taken as
the statements of the Company, and the Trustee and the Authenticating Agent
assume no responsibility for the correctness of the same. The Trustee and the
Authenticating Agent make no representations as to the validity or sufficiency
of this Indenture or of the Debentures. The Trustee and the Authenticating
Agent shall not be accountable for the use or application by the Company of any
Debentures or the proceeds of any Debentures authenticated and delivered by the
Trustee or the Authenticating Agent in conformity with the provisions of this
Indenture.

 

Section 6.4.           Trustee, Authenticating Agent, Paying Agents,
Transfer Agents or Registrar May Own Debentures. The
Trustee or any Authenticating Agent or any paying agent or any transfer agent
or any Debenture registrar, in its individual or any other capacity, may become
the owner or pledgee of Debentures with the same rights it would have if it
were not Trustee, Authenticating Agent, paying agent, transfer agent or
Debenture registrar.

 

Section 6.5.           Moneys to be Held in Trust. Subject
to the provisions of Section 12.4, all moneys received by the Trustee or
any paying agent shall, until used or applied as herein provided, be held in
trust for the purpose for which they were received, but need not be segregated
from other funds except to the extent required by law. The Trustee and any
paying agent shall be under no liability for interest on any money received by
it hereunder except as otherwise agreed in writing with the Company. So long as
no Event of Default shall have occurred and be continuing, all interest allowed
on any such moneys shall be paid from time to time upon the written order of
the Company, signed by the Chief Executive Officer, the President, a Vice
President, the Treasurer or an Assistant Treasurer of the Company.

 

Section 6.6.           Compensation and Expenses of Trustee.
The Company covenants and agrees to pay to the Trustee from time to time, and
the Trustee shall be entitled to, such compensation as shall be agreed to in
writing between the Company and the Trustee (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust), and the Company will pay or reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any of the provisions of this Indenture (including
the reasonable compensation and the expenses and disbursements of its counsel
and of all Persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or willful
misconduct. The Company also covenants to indemnify the Trustee and any
predecessor Trustee (and its officers, agents, directors and employees) for,
and to hold it harmless against, any and all loss, damage,

 

32

 

claim, liability or expense including taxes (other
than taxes based on the income of the Trustee) incurred without negligence or
willful misconduct on the part of the Trustee and arising out of or in
connection with the acceptance or administration of this trust, including the
costs and expenses of defending itself against any claim of liability. The
obligations of the Company under this Section 6.6 to compensate and
indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder. Such
additional indebtedness shall be secured by a lien prior to that of the
Debentures upon all property and funds held or collected by the Trustee as
such, except funds held in trust for the benefit of the holders of particular
Debentures.

 

Without
prejudice to any other rights available to the Trustee under applicable law,
when the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 5.1(d), Section 5.1(e) or Section 5.1(f),
the expenses (including the reasonable charges and expenses of its counsel) and
the compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
other similar law.

 

The
provisions of this Section shall survive the resignation or removal of the
Trustee and the defeasance or other termination of this Indenture.

 

Notwithstanding
anything in this Indenture or any Debenture to the contrary, the Trustee shall
have no obligation whatsoever to advance funds to pay any principal of or
interest on or other amounts with respect to the Debentures or otherwise
advance funds to or on behalf of the Company.

 

Section 6.7.           Officers’ Certificate as Evidence.
Except as otherwise provided in Sections 6.1 and 6.2, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking
or omitting any action hereunder, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may, in the absence of negligence or
willful misconduct on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers’ Certificate delivered to
the Trustee, and such certificate, in the absence of negligence or willful
misconduct on the part of the Trustee, shall be full warrant to the
Trustee for any action taken or omitted by it under the provisions of this
Indenture upon the faith thereof.

 

Section 6.8.           Eligibility of Trustee. The
Trustee hereunder shall at all times 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 authorized under such laws to exercise corporate trust powers, having
(or whose obligations under this Indenture are guaranteed by an affiliate
having) a combined capital and surplus of at least 50 million U.S. dollars
($50,000,000.00) 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 aforesaid supervising or examining authority, then for the purposes of
this Section 6.8 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 records of condition so published.

 

33

 

The
Company may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Company, serve as
Trustee.

 

In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 6.8, the Trustee shall resign immediately in
the manner and with the effect specified in Section 6.9.

 

If
the Trustee has or shall acquire any “conflicting interest” within the meaning
of §310(b) of the Trust Indenture Act of 1939, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner described by
this Indenture.

 

Section 6.9.           Resignation or Removal of Trustee.

 

(a)           The
Trustee, or any trustee or trustees hereafter appointed, may at any time
resign by giving written notice of such resignation to the Company and by
mailing notice thereof, at the Company’s expense, to the holders of the
Debentures at their addresses as they shall appear on the Debenture Register. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor trustee or trustees by written instrument, in duplicate, executed by
order of its Board of Directors, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor Trustee. If no
successor Trustee shall have been so appointed and have accepted appointment
within 30 days after the mailing of such notice of resignation to the affected
Securityholders, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee, or any Securityholder
who has been a bona fide holder of a Debenture or Debentures for at least six
months may, subject to the provisions of Section 5.9, on behalf of himself
and all others similarly situated, petition any such court for the appointment
of a successor Trustee. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, appoint a successor Trustee.

 

(b)           In
case at any time any of the following shall occur —

 

(1)            the Trustee
shall fail to comply with the provisions of Section 6.8 after written
request therefor by the Company or by any Securityholder who has been a bona
fide holder of a Debenture or Debentures for at least 6 months, or

 

(2)            the Trustee
shall cease to be eligible in accordance with the provisions of Section 6.8
and shall fail to resign after written request therefor by the Company or by
any such Securityholder, or

 

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

 

then,
in any such case, the Company may remove the Trustee and appoint a
successor Trustee by written instrument, in duplicate, executed by order of the
Board of Directors, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor Trustee, or, subject to the
provisions of Section 5.9, any Securityholder who has been a bona fide
holder of a Debenture

 

34

 

or
Debentures for at least 6 months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor Trustee.

 

(c)           Upon
prior written notice to the Company and the Trustee, the holders of a majority
in aggregate principal amount of the Debentures at the time outstanding may at
any time remove the Trustee and nominate a successor Trustee, which shall be
deemed appointed as successor Trustee unless within 10 Business Days after such
nomination the Company objects thereto, in which case, or in the case of a
failure by such holders to nominate a successor Trustee, the Trustee so removed
or any Securityholder, upon the terms and conditions and otherwise as in subsection (a) of
this Section 6.9 provided, may petition any court of competent
jurisdiction for an appointment of a successor Trustee.

 

(d)           Any
resignation or removal of the Trustee and appointment of a successor Trustee
pursuant to any of the provisions of this Section shall become effective
upon acceptance of appointment by the successor Trustee as provided in Section 6.10.

 

Section 6.10.        Acceptance by Successor Trustee.
Any successor Trustee appointed as provided in Section 6.9 shall execute,
acknowledge and deliver to the Company and to its predecessor Trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, duties and obligations with respect to the Debentures
of its predecessor hereunder, with like effect as if originally named as
Trustee herein; but, nevertheless, on the written request of the Company or of
the successor Trustee, the Trustee ceasing to act shall, upon payment of any
amounts then due it pursuant to the provisions of Section 6.6, execute and
deliver an instrument transferring to such successor Trustee all the rights and
powers of the Trustee so ceasing to act and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee thereunder. Upon request of any such successor Trustee, the Company
shall execute any and all instruments in writing for more fully and certainly
vesting in and confirming to such successor Trustee all such rights and powers.
Any Trustee ceasing to act shall, nevertheless, retain a lien upon all property
or funds held or collected by such Trustee to secure any amounts then due it
pursuant to the provisions of Section 6.6.

 

If
a successor Trustee is appointed, the Company, the retiring Trustee and the
successor Trustee shall execute and deliver an indenture supplemental hereto
which shall contain such provisions as shall be deemed necessary or desirable
to confirm that all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Debentures as to which the predecessor Trustee is
not retiring shall continue to be vested in the predecessor Trustee, and shall
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the Trust hereunder by more
than one Trustee, it being understood that nothing herein or in such
supplemental indenture shall constitute such Trustees co-trustees of the same
trust and that each such Trustee shall be Trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee.

 

35

 

No
successor Trustee shall accept appointment as provided in this Section unless
at the time of such acceptance such successor Trustee shall be eligible under
the provisions of Section 6.8.

 

In
no event shall a retiring Trustee be liable for the acts or omissions of any
successor Trustee hereunder.

 

Upon
acceptance of appointment by a successor Trustee as provided in this Section 6.10,
the Company shall mail notice of the succession of such Trustee hereunder to
the holders of Debentures at their addresses as they shall appear on the
Debenture Register. If the Company fails to mail such notice within 10 Business
Days after the acceptance of appointment by the successor Trustee, the
successor Trustee shall cause such notice to be mailed at the expense of the
Company.

 

Section 6.11.        Succession by Merger, etc. Any
corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder
without the execution or filing of any paper or any further act on the part of
any of the parties hereto; provided such corporation shall be otherwise
eligible and qualified under this Article.

 

In
case at the time such successor to the Trustee shall succeed to the trusts
created by this Indenture any of the Debentures shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee, and deliver such
Debentures so authenticated; and in case at that time any of the Debentures
shall not have been authenticated, any successor to the Trustee may authenticate
such Debentures either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificates shall have
the full force which it is anywhere in the Debentures or in this Indenture
provided that the certificate of the Trustee shall have; provided, however,
that the right to adopt the certificate of authentication of any predecessor
Trustee or authenticate Debentures in the name of any predecessor Trustee shall
apply only to its successor or successors by merger, conversion or
consolidation.

 

Section 6.12.        Authenticating Agents. There may be
one or more Authenticating Agents appointed by the Trustee upon the request of
the Company with power to act on its behalf and subject to its direction in the
authentication and delivery of the Debentures issued upon exchange or
registration of transfer thereof as fully to all intents and purposes as though
any such Authenticating Agent had been expressly authorized to authenticate and
deliver Debentures; provided, however, that the Trustee shall
have no liability to the Company for any acts or omissions of the
Authenticating Agent with respect to the authentication and delivery of any
Debentures. Any such Authenticating Agent shall at all times be a corporation
organized and doing business under the laws of the United States or of any
state or territory thereof or of the District of Columbia authorized under such
laws to act as Authenticating Agent, having a combined capital and surplus of
at least $50,000,000.00 and being 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
the requirements of such

 

36

 

authority, then for the purposes of this Section 6.12
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to
be eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect herein specified in this Section.

 

Any
corporation into which any Authenticating Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from
any merger, consolidation or conversion to which any Authenticating Agent shall
be a party, or any corporation succeeding to all or substantially all of the
corporate trust business of any Authenticating Agent, shall be the successor of
such Authenticating Agent hereunder, if such successor corporation is otherwise
eligible under this Section 6.12 without the execution or filing of any
paper or any further act on the part of the parties hereto or such
Authenticating Agent.

 

Any
Authenticating Agent may at any time resign by giving written notice of
resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of any Authenticating Agent with respect to the Debentures
by giving written notice of termination to such Authenticating Agent and to the
Company. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible under this Section 6.12, the Trustee may, and upon the request of
the Company shall, promptly appoint a successor Authenticating Agent eligible
under this Section 6.12, shall give written notice of such appointment to
the Company and shall mail notice of such appointment to all holders of
Debentures as the names and addresses of such holders appear on the Debenture
Register. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all rights, powers, duties and
responsibilities with respect to the Debentures of its predecessor hereunder,
with like effect as if originally named as Authenticating Agent herein.

 

The
Company agrees to pay to any Authenticating Agent from time to time reasonable
compensation for its services. Any Authenticating Agent shall have no
responsibility or liability for any action taken by it as such in accordance
with the directions of the Trustee.

 

ARTICLE VII.

CONCERNING THE SECURITYHOLDERS

 

Section 7.1.           Action by Securityholders. Whenever
in this Indenture it is provided that the holders of a specified percentage in
aggregate principal amount of the Debentures may take any action
(including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action) the fact that at the time
of taking any such action the holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by such Securityholders in person or by
agent or proxy appointed in writing, or (b) by the record of such holders
of Debentures voting in favor thereof at any meeting of such Securityholders
duly called and held in accordance with the provisions of Article VIII, or
(c) by a combination of such instrument or instruments and any such record
of such a meeting of such Securityholders or (d) by any other method the
Trustee deems satisfactory.

 

37

 

If
the Company shall solicit from the Securityholders any request, demand, authorization,
direction, notice, consent, waiver or other action or revocation of the same,
the Company may, at its option, as evidenced by an Officers’ Certificate, fix
in advance a record date for such Debentures for the determination of
Securityholders entitled to give such request, demand, authorization,
direction, notice, consent, waiver or other action or revocation of the same,
but the Company shall have no obligation to do so. If such a record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other action or revocation of the same may be given before or after the
record date, but only the Securityholders of record at the close of business on
the record date shall be deemed to be Securityholders for the purposes of determining
whether Securityholders of the requisite proportion of outstanding Debentures
have authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other action or revocation of the same,
and for that purpose the outstanding Debentures shall be computed as of the
record date; provided, however, that no such authorization,
agreement or consent by such Securityholders on the record date shall be deemed
effective unless it shall become effective pursuant to the provisions of this
Indenture not later than 6 months after the record date.

 

Section 7.2.           Proof of Execution by Securityholders.
Subject to the provisions of Section 6.1, 6.2 and 8.5, proof of the
execution of any instrument by a Securityholder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall
be satisfactory to the Trustee. The ownership of Debentures shall be proved by
the Debenture Register or by a certificate of the Debenture registrar. The
Trustee may require such additional proof of any matter referred to in
this Section as it shall deem necessary.

 

The
record of any Securityholders meeting shall be proved in the manner provided in
Section 8.6.

 

Section 7.3.           Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer of any Debenture, the
Company, the Trustee, any Authenticating Agent, any paying agent, any transfer
agent and any Debenture registrar may deem the Person in whose name such
Debenture shall be registered upon the Debenture Register to be, and may treat
him as, the absolute owner of such Debenture (whether or not such Debenture
shall be overdue) for the purpose of receiving payment of or on account of the
principal of, premium, if any, and interest on such Debenture and for all other
purposes; and neither the Company nor the Trustee nor any Authenticating Agent
nor any paying agent nor any transfer agent nor any Debenture registrar shall
be affected by any notice to the contrary. All such payments so made to any
holder for the time being or upon his order shall be valid, and, to the extent
of the sum or sums so paid, effectual to satisfy and discharge the liability
for moneys payable upon any such Debenture.

 

Section 7.4.           Debentures Owned by Company Deemed Not
Outstanding. In determining whether the holders of the requisite
aggregate principal amount of Debentures have concurred in any direction,
consent or waiver under this Indenture, Debentures which are owned by the
Company or any other obligor on the Debentures or by any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any other obligor on the Debentures shall be disregarded
and deemed not to be outstanding for the

 

38

 

purpose of any such determination; provided, however,
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, consent or waiver, only Debentures which a
Responsible Officer of the Trustee actually knows are so owned shall be so
disregarded. Debentures so owned which have been pledged in good faith may be
regarded as outstanding for the purposes of this Section 7.4 if the
pledgee shall establish to the satisfaction of the Trustee the pledgee’s right
to vote such Debentures and that the pledgee is not the Company or any such
other obligor or Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company or any such other
obligor. In the case of a dispute as to such right, any decision by the Trustee
taken upon the advice of counsel shall be full protection to the Trustee.

 

Section 7.5.           Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing to the Trustee, as provided
in Section 7.1, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Debentures specified in this
Indenture in connection with such action, any holder (in cases where no record
date has been set pursuant to Section 7.1) or any holder as of an
applicable record date (in cases where a record date has been set pursuant to Section 7.1)
of a Debenture (or any Debenture issued in whole or in part in exchange or
substitution therefor) the serial number of which is shown by the evidence to
be included in the Debentures the holders of which have consented to such
action may, by filing written notice with the Trustee at the Principal Office
of the Trustee and upon proof of holding as provided in Section 7.2,
revoke such action so far as concerns such Debenture (or so far as concerns the
principal amount represented by any exchanged or substituted Debenture). Except
as aforesaid any such action taken by the holder of any Debenture shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Debenture, and of any Debenture issued in exchange or substitution
therefor or on registration of transfer thereof, irrespective of whether or not
any notation in regard thereto is made upon such Debenture or any Debenture
issued in exchange or substitution therefor.

 

ARTICLE VIII.

SECURITYHOLDERS MEETINGS

 

Section 8.1.           Purposes of Meetings. A
meeting of Securityholders may be called at any time and from time to time
pursuant to the provisions of this Article VIII for any of the following
purposes:

 

(a)           to
give any notice to the Company or to the Trustee, or to give any directions to
the Trustee, or to consent to the waiving of any default hereunder and its
consequences, or to take any other action authorized to be taken by
Securityholders pursuant to any of the provisions of Article V;

 

(b)           to
remove the Trustee and nominate a successor trustee pursuant to the provisions
of Article VI;

 

(c)           to
consent to the execution of an indenture or indentures supplemental hereto
pursuant to the provisions of Section 9.2; or

 

39

 

(d)           to
take any other action authorized to be taken by or on behalf of the holders of
any specified aggregate principal amount of such Debentures under any other
provision of this Indenture or under applicable law.

 

Section 8.2.           Call of Meetings by Trustee. The
Trustee may at any time call a meeting of Securityholders to take any
action specified in Section 8.1, to be held at such time and at such place
as the Trustee shall determine. Notice of every meeting of the Securityholders,
setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be mailed to holders of
Debentures affected at their addresses as they shall appear on the Debentures
Register and, if the Company is not a holder of Debentures, to the Company. Such
notice shall be mailed not less than 20 nor more than 180 days prior to
the date fixed for the meeting.

 

Section 8.3.           Call of Meetings by Company or
Securityholders. In case at any time the Company pursuant to a
Board Resolution, or the holders of at least 10% in aggregate principal amount
of the Debentures, as the case may be, then outstanding, shall have
requested the Trustee to call a meeting of Securityholders, by written request
setting forth in reasonable detail the action proposed to be taken at the
meeting, and the Trustee shall not have mailed the notice of such meeting
within 20 days after receipt of such request, then the Company or such
Securityholders may determine the time and the place for such meeting and may call
such meeting to take any action authorized in Section 8.1, by mailing
notice thereof as provided in Section 8.2.

 

Section 8.4.           Qualifications for Voting. To
be entitled to vote at any meeting of Securityholders a Person shall be (a) a
holder of one or more Debentures with respect to which the meeting is being
held or (b) a Person appointed by an instrument in writing as proxy by a
holder of one or more such Debentures. The only Persons who shall be entitled
to be present or to speak at any meeting of Securityholders shall be the
Persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.

 

Section 8.5.           Regulations. Notwithstanding
any other provisions of this Indenture, the Trustee may make such
reasonable regulations as it may deem advisable for any meeting of
Securityholders, in regard to proof of the holding of Debentures and of the
appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit.

 

The
Trustee shall, by an instrument in writing, appoint a temporary chairman of the
meeting, unless the meeting shall have been called by the Company or by
Securityholders as provided in Section 8.3, in which case the Company or
the Securityholders calling the meeting, as the case may be, shall in like
manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the meeting.

 

Subject
to the provisions of Section 7.4, at any meeting each holder of Debentures
with respect to which such meeting is being held or proxy therefor shall be
entitled to one vote for each $1,000.00 principal amount of Debentures held or
represented by him; provided, however,

 

40

 

that no vote shall be cast or counted at any meeting in respect of any
Debenture challenged as not outstanding and ruled by the chairman of the
meeting to be not outstanding. The chairman of the meeting shall have no right
to vote other than by virtue of Debentures held by him or instruments in
writing as aforesaid duly designating him as the Person to vote on behalf of
other Securityholders. Any meeting of Securityholders duly called pursuant to
the provisions of Section 8.2 or 8.3 may be adjourned from time to
time by a majority of those present, whether or not constituting a quorum, and
the meeting may be held as so adjourned without further notice.

 

Section 8.6.           Voting. The vote upon any
resolution submitted to any meeting of holders of Debentures with respect to
which such meeting is being held shall be by written ballots on which shall be
subscribed the signatures of such holders or of their representatives by proxy
and the serial number or numbers of the Debentures held or represented by them.
The permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in triplicate of all votes cast at the meeting. A record in duplicate
of the proceedings of each meeting of Securityholders shall be prepared by the
secretary of the meeting and there shall be attached to said record the
original reports of the inspectors of votes on any vote by ballot taken thereat
and affidavits by one or more Persons having knowledge of the facts setting
forth a copy of the notice of the meeting and showing that said notice was
mailed as provided in Section 8.2. The record shall show the serial
numbers of the Debentures voting in favor of or against any resolution. The
record shall be signed and verified by the affidavits of the permanent chairman
and secretary of the meeting and one of the duplicates shall be delivered to
the Company and the other to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting.

 

Any
record so signed and verified shall be conclusive evidence of the matters
therein stated.

 

Section 8.7.           Quorum; Actions. The Persons
entitled to vote a majority in principal amount of the Debentures then outstanding
shall constitute a quorum for a meeting of Securityholders; provided, however,
that if any action is to be taken at such meeting with respect to a consent,
waiver, request, demand, notice, authorization, direction or other action which
may be given by the holders of not less than a specified percentage in
principal amount of the Debentures then outstanding, the Persons holding or
representing such specified percentage in principal amount of the Debentures
then outstanding will constitute a quorum. In the absence of a quorum within
30 minutes of the time appointed for any such meeting, the meeting shall,
if convened at the request of Securityholders, be dissolved. In any other case
the meeting may be adjourned for a period of not less than 10 days as
determined by the permanent chairman of the meeting prior to the adjournment of
such meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for a period of not less than
10 days as determined by the permanent chairman of the meeting prior to
the adjournment of such adjourned meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 8.2, except that
such notice need be given only once not less than 5 days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of
an adjourned meeting shall state expressly the percentage, as provided above,
of the principal amount of the Debentures then outstanding which shall
constitute a quorum.

 

41

 

Except
as limited by the provisos in the first paragraph of Section 9.2, any
resolution presented to a meeting or adjourned meeting duly reconvened at which
a quorum is present as aforesaid may be adopted by the affirmative vote of
the holders of a majority in principal amount of the Debentures then
outstanding; provided, however, that, except as limited by the
provisos in the first paragraph of Section 9.2, any resolution with
respect to any consent, waiver, request, demand, notice, authorization,
direction or other action which this Indenture expressly provides may be
given by the holders of not less than a specified percentage in principal
amount of the Debentures then outstanding may be adopted at a meeting or
an adjourned meeting duly reconvened and at which a quorum is present as
aforesaid only by the affirmative vote of the holders of a not less than such
specified percentage in principal amount of the Debentures then outstanding.

 

Any
resolution passed or decision taken at any meeting of holders of Debentures
duly held in accordance with this Section shall be binding on all the
Securityholders, whether or not present or represented at the meeting.

 

ARTICLE IX.

SUPPLEMENTAL INDENTURES

 

Section 9.1.           Supplemental Indentures without Consent of
Securityholders. The Company, when authorized by a Board
Resolution, and the Trustee may from time to time and at any time enter
into an indenture or indentures supplemental hereto, without the consent of the
Securityholders, for one or more of the following purposes:

 

(a)           to
evidence the succession of another Person to the Company, or successive
successions, and the assumption by the successor Person of the covenants,
agreements and obligations of the Company, pursuant to Article XI hereof;

 

(b)           to
add to the covenants of the Company such further covenants, restrictions or
conditions for the protection of the holders of Debentures as the Board of
Directors shall consider to be for the protection of the holders of such
Debentures, and to make the occurrence, or the occurrence and continuance, of a
default in any of such additional covenants, restrictions or conditions a
default or an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth; provided,
however, that in respect of any such additional covenant restriction or
condition such supplemental indenture may provide for a particular period
of grace after default (which period may be shorter or longer than that
allowed in the case of other defaults) or may provide for an immediate
enforcement upon such default or may limit the remedies available to the
Trustee upon such default;

 

(c)           to
cure any ambiguity or to correct or supplement any provision contained herein
or in any supplemental indenture which may be defective or inconsistent
with any other provision contained herein or in any supplemental indenture, or
to make such other provisions in regard to matters or questions arising under
this Indenture; provided that any such action shall not materially
adversely affect the interests of the holders of the Debentures;

 

(d)           to
add to, delete from, or revise the terms of Debentures, including, without
limitation, any terms relating to the issuance, exchange, registration or
transfer of Debentures,

 

42

 

including to provide for transfer procedures and
restrictions substantially similar to those applicable to the Capital
Securities as required by Section 2.5 (for purposes of assuring that no
registration of Debentures is required under the Securities Act); provided,
however, that any such action shall not adversely affect the interests
of the holders of the Debentures then outstanding (it being understood, for
purposes of this proviso, that transfer restrictions on Debentures
substantially similar to those that were applicable to Capital Securities shall
not be deemed to materially adversely affect the holders of the Debentures);

 

(e)           to
evidence and provide for the acceptance of appointment hereunder by a successor
Trustee with respect to the Debentures and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee;

 

(f)            to
make any change (other than as elsewhere provided in this paragraph) that does
not adversely affect the rights of any Securityholder in any material respect;
or

 

(g)           to
provide for the issuance of and establish the form and terms and
conditions of the Debentures, to establish the form of any certifications
required to be furnished pursuant to the terms of this Indenture or the
Debentures, or to add to the rights of the holders of Debentures.

 

The
Trustee is hereby authorized to join with the Company in the execution of any
such supplemental indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the conveyance,
transfer and assignment of any property thereunder, but the Trustee shall not
be obligated to, but may in its discretion, enter into any such
supplemental indenture which affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise.

 

Any
supplemental indenture authorized by the provisions of this Section 9.1 may be
executed by the Company and the Trustee without the consent of the holders of
any of the Debentures at the time outstanding, notwithstanding any of the
provisions of Section 9.2.

 

Section 9.2.           Supplemental Indentures with Consent of
Securityholders. With the consent (evidenced as provided in Section 7.1)
of the holders of not less than a majority in aggregate principal amount of the
Debentures at the time outstanding affected by such supplemental indenture
(voting as a class), the Company, when authorized by a Board Resolution, and
the Trustee may from time to time and at any time enter into an indenture
or indentures supplemental hereto for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Indenture or of any supplemental indenture or of modifying in any manner the
rights of the holders of the Debentures; provided, however, that
no such supplemental indenture shall without the consent of the holders of each
Debenture then outstanding and affected thereby (i) change the fixed
maturity of any Debenture, or reduce the principal amount thereof or any
premium thereon, or reduce the rate or extend the time of payment of interest
thereon, or reduce any amount payable on redemption thereof or make the
principal thereof or any interest or premium thereon payable in any coin or
currency other than that provided in the Debentures, or impair or affect the
right of any Securityholder to institute suit for payment thereof or impair the
right of repayment, if any, at the option of the holder, or (ii) reduce
the aforesaid percentage of Debentures the holders of which are required to
consent to

 

43

 

any such supplemental indenture; provided  further,
however, that if the Debentures are held by a trust or a trustee of such
trust, such supplemental indenture shall not be effective until the holders of
a majority in Liquidation Amount of Trust Securities shall have consented to
such supplemental indenture; provided  further, however,
that if the consent of the Securityholder of each outstanding Debenture is
required, such supplemental indenture shall not be effective until each holder
of the Trust Securities shall have consented to such supplemental indenture.

 

Upon
the request of the Company accompanied by a Board Resolution authorizing the
execution of any such supplemental indenture, and upon the filing with the
Trustee of evidence of the consent of Securityholders as aforesaid, the Trustee
shall join with the Company in the execution of such supplemental indenture
unless such supplemental indenture affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental
indenture.

 

Promptly
after the execution by the Company and the Trustee of any supplemental
indenture pursuant to the provisions of this Section, the Trustee shall
transmit by mail, first class postage prepaid, a notice, prepared by the
Company, setting forth in general terms the substance of such supplemental
indenture, to the Securityholders as their names and addresses appear upon the
Debenture Register. Any failure of the Trustee to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.

 

It
shall not be necessary for the consent of the Securityholders under this Section 9.2
to approve the particular form of any proposed supplemental indenture, but
it shall be sufficient if such consent shall approve the substance thereof.

 

Section 9.3.           Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture pursuant to the provisions of
this Article IX, this Indenture shall be and be deemed to be modified and
amended in accordance therewith and the respective rights, limitations of
rights, obligations, duties and immunities under this Indenture of the Trustee,
the Company and the holders of Debentures shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments and all the terms and conditions of any such supplemental
indenture shall be and be deemed to be part of the terms and conditions of
this Indenture for any and all purposes.

 

Section 9.4.           Notation on Debentures. Debentures
authenticated and delivered after the execution of any supplemental indenture
pursuant to the provisions of this Article IX may bear a notation as
to any matter provided for in such supplemental indenture. If the Company or
the Trustee shall so determine, new Debentures so modified as to conform, in
the opinion of the Board of Directors of the Company, to any modification of
this Indenture contained in any such supplemental indenture may be
prepared and executed by the Company, authenticated by the Trustee or the
Authenticating Agent and delivered in exchange for the Debentures then
outstanding.

 

Section 9.5.           Evidence of Compliance of Supplemental
Indenture to be Furnished to Trustee. The Trustee, subject to
the provisions of Sections 6.1 and 6.2, shall, in addition to the
documents required by Section 14.6, receive an Officers’ Certificate and
an Opinion of

 

44

 

Counsel as conclusive evidence that any supplemental
indenture executed pursuant hereto complies with the requirements of this Article IX.
The Trustee shall receive an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant to this Article IX is authorized
or permitted by, and conforms to, the terms of this Article IX and that it
is proper for the Trustee under the provisions of this Article IX to join
in the execution thereof.

 

ARTICLE X.

REDEMPTION OF SECURITIES

 

Section 10.1.        Optional Redemption. The
Company shall have the right to redeem the Debentures, in whole or in part, but
in all cases in a principal amount with integral multiples of $1,000.00, on any
January 29, April 29, July 29 or October 29 on or after October 29,
2008 (an “Optional Redemption Date”), at the Optional Redemption Price.

 

Section 10.2.        Special Event Redemption. If a
Special Event shall occur and be continuing, the Company shall have the right
to redeem the Debentures in whole, but not in part, at any Interest Payment
Date, within 120 days following the occurrence of such Special Event (the “Special
Redemption Date”) at the Special Redemption Price.

 

Section 10.3.        Notice of Redemption; Selection of Debentures.
In case the Company shall desire to exercise the right to redeem all, or, as
the case may be, any part of the Debentures, it shall cause to be
mailed a notice of such redemption at least 30 and not more than 60 days
prior to the Optional Redemption Date or the Special Redemption Date to the
holders of Debentures so to be redeemed as a whole or in part at their
last addresses as the same appear on the Debenture Register. Such mailing shall
be by first class mail. The notice if mailed in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
holder receives such notice. In any case, failure to give such notice by mail
or any defect in the notice to the holder of any Debenture designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Debenture.

 

Each
such notice of redemption shall specify the CUSIP number, if any, of the
Debentures to be redeemed, the Optional Redemption Date or the Special
Redemption Date, as applicable, the Optional Redemption Price or the Special
Redemption Price, as applicable, at which Debentures are to be redeemed, the
place or places of payment, that payment will be made upon presentation and
surrender of such Debentures, that interest accrued to the date fixed for
redemption will be paid as specified in said notice, and that on and after said
date interest thereon or on the portions thereof to be redeemed will cease to
accrue. If less than all the Debentures are to be redeemed the notice of
redemption shall specify the numbers of the Debentures to be redeemed. In case
the Debentures are to be redeemed in part only, the notice of redemption
shall state the portion of the principal amount thereof to be redeemed and
shall state that on and after the date fixed for redemption, upon surrender of
such Debenture, a new Debenture or Debentures in principal amount equal to the
unredeemed portion thereof will be issued.

 

Prior
to 10:00 a.m. (New York City time) on the Optional Redemption Date or
Special Redemption Date, as applicable, the Company will deposit with the
Trustee or with one or more paying agents an amount of money sufficient to
redeem on the Optional Redemption Date or the Special Redemption Date, as
applicable, all the Debentures so called for redemption at the

 

45

 

appropriate Optional Redemption Price or Special Redemption Price,
together with accrued interest to the Optional Redemption Date or Special
Redemption Date, as applicable.

 

If
all, or less than all, the Debentures are to be redeemed, the Company will give
the Trustee notice not less than 45 nor more than 60 days, respectively,
prior to the Optional Redemption Date or Special Redemption Date, as
applicable, as to the aggregate principal amount of Debentures to be redeemed
and the Trustee shall select, in such manner as in its sole discretion it shall
deem appropriate and fair, the Debentures or portions thereof (in integral
multiples of $1,000.00) to be redeemed.

 

Section 10.4.        Payment of Debentures Called for Redemption.
If notice of redemption has been given as provided in Section 10.3, the
Debentures or portions of Debentures with respect to which such notice has been
given shall become due and payable on the Optional Redemption Date or Special
Redemption Date, as applicable, and at the place or places stated in such
notice at the applicable Optional Redemption Price or Special Redemption Price,
together with interest accrued to the Optional Redemption Date or Special
Redemption Date, as applicable, and on and after said date (unless the Company
shall default in the payment of such Debentures at the Optional Redemption
Price or Special Redemption Price, as applicable, together with interest
accrued to said date) interest on the Debentures or portions of Debentures so
called for redemption shall cease to accrue. On presentation and surrender of
such Debentures at a place of payment specified in said notice, such Debentures
or the specified portions thereof shall be paid and redeemed by the Company at
the applicable Optional Redemption Price or Special Redemption Price, together
with interest accrued thereon to the Optional Redemption Date or Special
Redemption Date, as applicable.

 

Upon
presentation of any Debenture redeemed in part only, the Company shall
execute and the Trustee shall authenticate and make available for delivery to
the holder thereof, at the expense of the Company, a new Debenture or
Debentures of authorized denominations, in principal amount equal to the
unredeemed portion of the Debenture so presented.

 

ARTICLE XI.

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

 

Section 11.1.        Company May Consolidate, etc., on
Certain Terms. Nothing contained in this Indenture or in the
Debentures shall prevent any consolidation or merger of the Company with or
into any other Person (whether or not affiliated with the Company) or
successive consolidations or mergers in which the Company or its successor or
successors shall be a party or parties, or shall prevent any sale, conveyance,
transfer or other disposition of the property or capital stock of the Company
or its successor or successors as an entirety, or substantially as an entirety,
to any other Person (whether or not affiliated with the Company, or its
successor or successors) authorized to acquire and operate the same; provided,
however, that the Company hereby covenants and agrees that, upon any
such consolidation, merger (where the Company is not the surviving
corporation), sale, conveyance, transfer or other disposition, the due and
punctual payment of the principal of (and premium, if any) and interest on all
of the Debentures in accordance with their terms, according to their tenor, and
the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be kept or performed by the Company, shall be
expressly assumed by supplemental indenture satisfactory in form to the

 

46

 

Trustee executed and delivered to the Trustee by the
entity formed by such consolidation, or into which the Company shall have been
merged, or by the entity which shall have acquired such property or capital
stock.

 

Section 11.2.        Successor Entity to be Substituted.
In case of any such consolidation, merger, sale, conveyance, transfer or other
disposition and upon the assumption by the successor entity, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in form to
the Trustee, of the due and punctual payment of the principal of and premium,
if any, and interest on all of the Debentures and the due and punctual
performance and observance of all of the covenants and conditions of this
Indenture to be performed or observed by the Company, such successor entity
shall succeed to and be substituted for the Company, with the same effect as if
it had been named herein as the Company, and thereupon the predecessor entity
shall be relieved of any further liability or obligation hereunder or upon the
Debentures. Such successor entity thereupon may cause to be signed, and may issue
in its own name, any or all of the Debentures issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee or the Authenticating Agent; and, upon the order of such successor
entity instead of the Company and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee or the Authenticating
Agent shall authenticate and deliver any Debentures which previously shall have
been signed and delivered by the officers of the Company, to the Trustee or the
Authenticating Agent for authentication, and any Debentures which such
successor entity thereafter shall cause to be signed and delivered to the
Trustee or the Authenticating Agent for that purpose. All the Debentures so
issued shall in all respects have the same legal rank and benefit under this
Indenture as the Debentures theretofore or thereafter issued in accordance with
the terms of this Indenture as though all of such Debentures had been issued at
the date of the execution hereof.

 

Section 11.3.        Opinion of Counsel to be Given to Trustee.
The Trustee, subject to the provisions of Sections 6.1 and 6.2, shall
receive, in addition to the Opinion of Counsel required by Section 9.5, an
Opinion of Counsel as conclusive evidence that any consolidation, merger, sale,
conveyance, transfer or other disposition, and any assumption, permitted or
required by the terms of this Article XI complies with the provisions of
this Article XI.

 

ARTICLE XII.

SATISFACTION AND DISCHARGE OF INDENTURE

 

Section 12.1.        Discharge
of Indenture. When

 

(a)         the Company
shall deliver to the Trustee for cancellation all Debentures theretofore
authenticated (other than any Debentures which shall have been destroyed, lost
or stolen and which shall have been replaced or paid as provided in Section 2.6)
and not theretofore canceled, or 

 

(b)        all the
Debentures not theretofore canceled or delivered to the Trustee for
cancellation shall have become due and payable, or are by their terms to become
due and payable within 1 year or are to be called for redemption within 1 year
under arrangements satisfactory to the Trustee for the giving of notice of
redemption, and the Company shall deposit with the Trustee, in trust, funds,
which

 

47

 

shall
be immediately due and payable, sufficient to pay at maturity or upon
redemption all of the Debentures (other than any Debentures which shall have
been destroyed, lost or stolen and which shall have been replaced or paid as
provided in Section 2.6) not theretofore canceled or delivered to the
Trustee for cancellation, including principal and premium, if any, and interest
due or to become due to such date of maturity or redemption date, as the case may be,
but excluding, however, the amount of any moneys for the payment of principal
of, and premium, if any, or interest on the Debentures (1) theretofore
repaid to the Company in accordance with the provisions of Section 12.4,
or (2) paid to any state or to the District of Columbia pursuant to its
unclaimed property or similar laws,

 

and if in the case
of either clause (a) or clause (b) the Company shall also
pay or cause to be paid all other sums payable hereunder by the Company, then
this Indenture shall cease to be of further effect except for the provisions of
Sections 2.5, 2.6, 2.8, 3.1, 3.2, 3.4, 6.6, 6.8, 6.9 and 12.4 hereof shall
survive until such Debentures shall mature and be paid. Thereafter,
Sections 6.6 and 12.4 shall survive, and the Trustee, on demand of the
Company accompanied by an Officers’ Certificate and an Opinion of Counsel, each
stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with, and at
the cost and expense of the Company, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture. The Company
agrees to reimburse the Trustee for any costs or expenses thereafter reasonably
and properly incurred by the Trustee in connection with this Indenture or the
Debentures.

 

Section 12.2.        Deposited Moneys to be Held in Trust by
Trustee. Subject to the provisions of Section 12.4, all
moneys deposited with the Trustee pursuant to Section 12.1 shall be held
in trust in a non-interest bearing account and applied by it to the payment,
either directly or through any paying agent (including the Company if acting as
its own paying agent), to the holders of the particular Debentures for the
payment of which such moneys have been deposited with the Trustee, of all sums
due and to become due thereon for principal, and premium, if any, and interest.

 

Section 12.3.        Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture all moneys then held by
any paying agent of the Debentures (other than the Trustee) shall, upon demand
of the Company, be repaid to it or paid to the Trustee, and thereupon such
paying agent shall be released from all further liability with respect to such
moneys.

 

Section 12.4.        Return of Unclaimed Moneys. Any
moneys deposited with or paid to the Trustee or any paying agent for payment of
the principal of, and premium, if any, or interest on Debentures and not
applied but remaining unclaimed by the holders of Debentures for 2 years after
the date upon which the principal of, and premium, if any, or interest on such
Debentures, as the case may be, shall have become due and payable, shall,
subject to applicable escheatment laws, be repaid to the Company by the Trustee
or such paying agent on written demand; and the holder of any of the Debentures
shall thereafter look only to the Company for any payment which such holder may be
entitled to collect, and all liability of the Trustee or such paying agent with
respect to such moneys shall thereupon cease.

 

48

 

ARTICLE XIII.

IMMUNITY OF INCORPORATORS, STOCKHOLDERS,

OFFICERS AND DIRECTORS

 

Section 13.1.        Indenture and Debentures Solely Corporate
Obligations. No recourse for the payment of the principal of or
premium, if any, or interest on any Debenture, or for any claim based thereon
or otherwise in respect thereof, and no recourse under or upon any obligation,
covenant or agreement of the Company in this Indenture or in any supplemental
indenture, or in any such Debenture, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder,
employee, officer or director, as such, past, present or future, of the Company
or of any successor Person of the Company, either directly or through the
Company or any successor Person of the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the
Debentures.

 

ARTICLE XIV.

MISCELLANEOUS PROVISIONS

 

Section 14.1.        Successors. All the covenants,
stipulations, promises and agreements of the Company in this Indenture shall
bind its successors and assigns whether so expressed or not.

 

Section 14.2.        Official Acts by Successor Entity.
Any act or proceeding by any provision of this Indenture authorized or required
to be done or performed by any board, committee or officer of the Company shall
and may be done and performed with like force and effect by the like
board, committee, officer or other authorized Person of any entity that shall
at the time be the lawful successor of the Company.

 

Section 14.3.        Surrender of Company Powers. The
Company by instrument in writing executed by authority of at least 2/3
(two-thirds) of its Board of Directors and delivered to the Trustee may surrender
any of the powers reserved to the Company and thereupon such power so
surrendered shall terminate both as to the Company, and as to any permitted
successor.

 

Section 14.4.        Addresses for Notices, etc. Any
notice, consent, direction, request, authorization, waiver or demand which by
any provision of this Indenture is required or permitted to be given, made,
furnished or served by the Trustee or by the Securityholders on or to the
Company may be given or served in writing by being deposited postage
prepaid by registered or certified mail in a post office letter box addressed
(until another address is filed by the Company, with the Trustee for the
purpose) to the Company, 140 Broadway, 47th Floor, New York, New York 10005
Attention:  Adam R. Willkomm. Any notice,
consent, direction, request, authorization, waiver or demand by any
Securityholder or the Company to or upon the Trustee shall be deemed to have
been sufficiently given or made, for all purposes, if given or made in writing
at the office of the Trustee, addressed to the Trustee, 225 Asylum Street,
Goodwin Square, Hartford, Connecticut 06103 Attention: Vice President,
Corporate Trust Services, with a copy to the Trustee, 1 Federal Street, Boston,
Massachusetts 02110, Attention: 
Paul D. Allen, Corporate Trust Services. Any notice, consent,
direction, request, authorization,

 

49

 

waiver or demand on or to any Securityholder shall be
deemed to have been sufficiently given or made, for all purposes, if given or
made in writing at the address set forth in the Debenture Register.

 

Section 14.5.        Governing Law. This Indenture
and each Debenture shall be deemed to be a contract made under the law of the
State of New York, and for all purposes shall be governed by and construed in
accordance with the law of said State, without regard to conflict of laws principles
thereof, except with respect to authorization and execution by or on behalf of
the Company which are required to be governed by the laws of Bermuda.

 

Section 14.6.        Evidence of Compliance with Conditions
Precedent. Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers’ Certificate stating that in
the opinion of the signers all conditions precedent, if any, provided for in
this Indenture relating to the proposed action have been complied with and an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.

 

Each
certificate or opinion provided for in this Indenture and delivered to the
Trustee with respect to compliance with a condition or covenant provided for in
this Indenture shall include (1) a statement that the person making such
certificate or opinion has read such covenant or condition; (2) a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based; (3) a statement that, in the opinion of such person, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not in the opinion of
such person, such condition or covenant has been complied with.

 

Section 14.7.        Non-Business Days. In any case
where the date of payment of interest on or principal of the Debentures will be
a day that is not a Business Day, the payment of such interest on or principal
of the Debentures need not be made on such date but may be made on the
next succeeding Business Day, except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the original date of payment, and no interest shall accrue for the period
from and after such date.

 

Section 14.8.        Table of Contents, Headings, etc. The
table of contents and the titles and headings of the articles and sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof, and shall in no way modify or restrict any of
the terms or provisions hereof.

 

Section 14.9.        Execution in Counterparts. This
Indenture may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute but one
and the same instrument.

 

Section 14.10.      Severability. In case any one
or more of the provisions contained in this Indenture or in the Debentures
shall for any reason be held to be invalid, illegal or unenforceable

 

50

 

in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Indenture or of
such Debentures, but this Indenture and such Debentures shall be construed as
if such invalid or illegal or unenforceable provision had never been contained
herein or therein.

 

Section 14.11.      Assignment. The Company will
have the right at all times to assign any of its rights or obligations under
this Indenture to a direct or indirect wholly owned Subsidiary of the Company,
provided that, in the event of any such assignment, the Company will remain
liable for all such obligations. Subject to the foregoing, this Indenture is
binding upon and inures to the benefit of the parties hereto and their
respective successors and assigns. This Indenture may not otherwise be
assigned by the parties hereto.

 

Section 14.12.      Acknowledgment of Rights. The
Company agrees that, with respect to any Debentures held by the Trust or the
Institutional Trustee of the Trust, if the Institutional Trustee of the Trust
fails to enforce its rights under this Indenture as the holder of Debentures
held as the assets of such Trust after the holders of a majority in Liquidation
Amount of the Capital Securities of such Trust have so directed such
Institutional Trustee, a holder of record of such Capital Securities may, to
the fullest extent permitted by law, institute legal proceedings directly
against the Company to enforce such Institutional Trustee’s rights under this
Indenture without first instituting any legal proceedings against such trustee
or any other Person. Notwithstanding the foregoing, if an Event of Default has
occurred and is continuing and such event is attributable to the failure of the
Company to pay interest (or premium, if any) or principal on the Debentures on
the date such interest (or premium, if any) or principal is otherwise payable
(or in the case of redemption, on the redemption date), the Company agrees that
a holder of record of Capital Securities of the Trust may directly
institute a proceeding against the Company for enforcement of payment to such
holder directly of the principal of (or premium, if any) or interest on the
Debentures having an aggregate principal amount equal to the aggregate
Liquidation Amount of the Capital Securities of such holder on or after the
respective due date specified in the Debentures.

 

Section 14.13.      Submission to Jurisdiction; Appointment of
Agent for Service. In further consideration of the agreement of
the Trustee herein contained, the Company agrees and covenants as follows:

 

The Company irrevocably
agrees that any legal suit, action or proceeding against the Company brought by
the Trustee arising out of or based upon this Indenture or the transactions
contemplated hereby may be instituted in any United States Federal or
state court in the Borough of Manhattan, The City of New York, State of New
York (a “New York Court”), and irrevocably waives any objection which it may now
or hereafter have to the laying of venue of any such proceeding, irrevocably
waives any objection based on the absence of a necessary or indispensable party
in any such proceeding and irrevocably submits to the non-exclusive
jurisdiction of such courts in any such suit, action or proceeding. The Company
irrevocably waives any immunity to jurisdiction to which it may otherwise
be entitled or become entitled (including immunity to pre-judgment attachment
and execution) in any legal suit, action or proceeding against it arising out
of this Indenture or the transactions contemplated hereby which is instituted
in any New York Court or in any foreign court. To the extent permitted by law,
the Company hereby waives any objection to the enforcement by any competent
foreign court of any

 

51

 

judgment validly
obtained in any such proceeding. The Company designates and appoints
Corporation Service Company in Albany, New York as its authorized agent (the “Authorized
Agent”) upon which process may be served in any such action arising out of
or based on this Indenture or the transactions contemplated hereby which may be
instituted in any New York Court by the Trustee, expressly consents to the
non-exclusive jurisdiction of any such court in respect of any such action, and
waives any other requirements of or objections to personal jurisdiction with
respect thereto. Such appointments shall be irrevocable. The Company represents
and warrants that its Authorized Agent has agreed to act as said agent for
service of process and the Company agrees to take any and all action, including
the filing of any and all documents and instruments, that may be necessary
to continue such appointment in full force and effect as aforesaid. Service of
process upon the Authorized Agent and written notice of such service of process
to it shall be deemed, in every respect, effective service of process upon the
Company. Notwithstanding the foregoing, any action based on this Indenture or
the transactions contemplated hereby may be instituted by the Trustee in
any competent foreign court.

 

The provisions of this Section 14.13
shall survive any termination of this Indenture, in whole or in part.

 

Section 14.14.      Judgment Currency. The Company
agrees, to the fullest extent that it may effectively do so under
applicable law, that (a) if for the purpose of obtaining judgment in any
court it is necessary to convert the sum due in respect of the principal of,
and premium, interest, and Additional Sums, if any, on the Debentures (the “Required
Currency”) into a currency in which a judgment will be rendered (the “Judgment
Currency”), the rate of exchange used shall be the rate at which in accordance
with normal banking procedures the Trustee could purchase in The City of New
York the requisite amount of the Required Currency with the Judgment Currency
on the Business Day preceding the day on which a final unappealable judgment is
given and (b) its obligations under this Indenture to make payments in the
Required Currency (i) shall not be discharged or satisfied by any tender,
or any recovery pursuant to any judgment (whether or not entered into in
accordance with clause (a)), in any currency other than the Required Currency,
except to the extent that such tender or recovery shall result in the actual
receipt, by the payee, of the full amount of the Required Currency expressed to
be payable in respect of such payments, (ii) shall be enforceable as an
alternative or additional cause of action for the purpose of recovering in the
Required Currency the amount, if any, by which such actual receipt shall fall
short of the full amount of the Required Currency so expressed to be payable
and (iii) shall not be affected by judgment being obtained for any other
sum due under this Indenture. 

 

Section 14.15.      Waiver of Immunity. To the extent that
the Company has or hereafter may acquire any immunity (sovereign or
otherwise) from any legal action, suit or proceeding, from jurisdiction of any
court or from set-off or any legal process (whether service or notice,
attachment in aid or otherwise) with respect to itself or any of its property,
the Company hereby irrevocably waives and agrees not to plead or claim such
immunity in respect of its obligations under this Indenture.

 

52

 

ARTICLE XV.

SUBORDINATION OF DEBENTURES

 

Section 15.1.        Agreement to Subordinate. The
Company covenants and agrees, and each holder of Debentures by such
Securityholder’s acceptance thereof likewise covenants and agrees, that all
Debentures shall be issued subject to the provisions of this Article XV;
and each holder of a Debenture, whether upon original issue or upon transfer or
assignment thereof, accepts and agrees to be bound by such provisions.

 

The
payment by the Company of the principal of, and premium, if any, and interest
on all Debentures shall, to the extent and in the manner hereinafter set forth,
be subordinated and junior in right of payment to the prior payment in full of
all Senior Indebtedness of the Company, whether outstanding at the date of this
Indenture or thereafter incurred.

 

The
Debentures shall rank pari passu
with (i) that certain Floating Rate Junior Subordinated Deferrable
Interest Debenture issued by the Company on December 4, 2002, in the
principal amount of $18,042,000.00; and (ii) that certain Floating Rate
Junior Subordinated Deferrable Interest Debenture issued by the Company on May 15,
2003, in the principal amount of $20,619,000.00.

 

No
provision of this Article XV shall prevent the occurrence of any default
or Event of Default hereunder.

 

Section 15.2.        Default on Senior Indebtedness.
In the event and during the continuation of any default by the Company in the
payment of principal, premium, interest or any other payment due on any Senior
Indebtedness of the Company following any grace period, or in the event that
the maturity of any Senior Indebtedness of the Company has been accelerated
because of a default and such acceleration has not been rescinded or canceled
and such Senior Indebtedness has not been paid in full, then, in either case,
no payment shall be made by the Company with respect to the principal
(including redemption) of, or premium, if any, or interest on the Debentures.

 

In
the event that, notwithstanding the foregoing, any payment shall be received by
the Trustee when such payment is prohibited by the preceding paragraph of this Section 15.2,
such payment shall, subject to Section 15.7, be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Indebtedness may have
been issued, as their respective interests may appear, but only to the
extent that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee in writing within 90 days
of such payment of the amounts then due and owing on the Senior Indebtedness
and only the amounts specified in such notice to the Trustee shall be paid to
the holders of Senior Indebtedness.

 

Section 15.3.        Liquidation, Dissolution, Bankruptcy.
Upon any payment by the Company or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, to creditors upon
any dissolution or winding-up or liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency,

 

53

 

receivership or other proceedings, all amounts due
upon all Senior Indebtedness of the Company shall first be paid in full, or
payment thereof provided for in money in accordance with its terms, before any
payment is made by the Company, on account of the principal (and premium, if
any) or interest on the Debentures. Upon any such dissolution or winding-up or
liquidation or reorganization, any payment by the Company, or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, to which the Securityholders or the Trustee would be entitled to
receive from the Company, except for the provisions of this Article XV,
shall be paid by the Company, or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Securityholders or by the Trustee under this Indenture if received by
them or it, directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective
amounts of Senior Indebtedness held by such holders, as calculated by the
Company) or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing such
Senior Indebtedness may have been issued, as their respective interests may appear,
to the extent necessary to pay such Senior Indebtedness in full, in money or
money’s worth, after giving effect to any concurrent payment or distribution to
or for the holders of such Senior Indebtedness, before any payment or
distribution is made to the Securityholders or to the Trustee.

 

In
the event that, notwithstanding the foregoing, any payment or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, prohibited by the foregoing, shall be received by the Trustee
before all Senior Indebtedness is paid in full, or provision is made for such
payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of and shall be paid over or delivered
to the holders of such Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Indebtedness may have been
issued, as their respective interests may appear, as calculated by the
Company, for application to the payment of all Senior Indebtedness, remaining
unpaid to the extent necessary to pay such Senior Indebtedness in full in money
in accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.

 

For
purposes of this Article XV, the words “cash, property or securities”
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article XV with
respect to the Debentures to the payment of all Senior Indebtedness, that may at
the time be outstanding, provided that (i) such Senior Indebtedness is
assumed by the new corporation, if any, resulting from any such reorganization
or readjustment, and (ii) the rights of the holders of such Senior
Indebtedness are not, without the consent of such holders, altered by such
reorganization or readjustment. The consolidation of the Company with, or the
merger of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon
the terms and conditions provided for in Article XI of this Indenture
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Section if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, comply with the conditions
stated in Article XI of this Indenture. Nothing in

 

54

 

Section 15.2 or in this Section shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 6.6 of this
Indenture.

 

Section 15.4.        Subrogation. Subject to the
payment in full of all Senior Indebtedness, the Securityholders shall be
subrogated to the rights of the holders of such Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company,
applicable to such Senior Indebtedness until the principal of (and premium, if
any) and interest on the Debentures shall be paid in full. For the purposes of
such subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the Securityholders
or the Trustee would be entitled except for the provisions of this Article XV,
and no payment over pursuant to the provisions of this Article XV to or
for the benefit of the holders of such Senior Indebtedness by Securityholders
or the Trustee, shall, as between the Company, its creditors other than holders
of Senior Indebtedness of the Company, and the holders of the Debentures be
deemed to be a payment or distribution by the Company to or on account of such
Senior Indebtedness. It is understood that the provisions of this Article XV
are and are intended solely for the purposes of defining the relative rights of
the holders of the Securities, on the one hand, and the holders of such Senior
Indebtedness, on the other hand.

 

Nothing
contained in this Article XV or elsewhere in this Indenture or in the
Debentures is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Indebtedness, and the holders of the
Debentures, the obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Debentures the principal of (and premium, if any)
and interest on the Debentures as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the holders of the Debentures and creditors of the Company,
other than the holders of Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the holder of any Debenture from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article XV of the
holders of such Senior Indebtedness in respect of cash, property or securities
of the Company, received upon the exercise of any such remedy.

 

Upon
any payment or distribution of assets of the Company referred to in this Article XV,
the Trustee, subject to the provisions of Article VI of this Indenture,
and the Securityholders shall be entitled to conclusively rely upon any order
or decree made by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidation trustee,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the Securityholders, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article XV.

 

Section 15.5.        Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder’s acceptance thereof authorizes and
directs the Trustee on such Securityholder’s behalf to take such action as may be
necessary or appropriate to effectuate the subordination

 

55

 

provided in this Article XV and appoints the
Trustee such Securityholder’s attorney-in-fact for any and all such purposes.

 

Section 15.6.        Notice by the Company. The
Company shall give prompt written notice to a Responsible Officer of the
Trustee at the Principal Office of the Trustee of any fact known to the Company
that would prohibit the making of any payment of monies to or by the Trustee in
respect of the Debentures pursuant to the provisions of this Article XV. Notwithstanding
the provisions of this Article XV or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of monies to or by the
Trustee in respect of the Debentures pursuant to the provisions of this Article XV,
unless and until a Responsible Officer of the Trustee at the Principal Office
of the Trustee shall have received written notice thereof from the Company or a
holder or holders of Senior Indebtedness or from any trustee therefor; and
before the receipt of any such written notice, the Trustee, subject to the
provisions of Article VI of this Indenture, shall be entitled in all
respects to assume that no such facts exist; provided, however,
that if the Trustee shall not have received the notice provided for in this Section at
least 2 Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose (including, without limitation,
the payment of the principal of (or premium, if any) or interest on any
Debenture), then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such money and to
apply the same to the purposes for which they were received, and shall not be
affected by any notice to the contrary that may be received by it within 2
Business Days prior to such date.

 

The
Trustee, subject to the provisions of Article VI of this Indenture, shall
be entitled to conclusively rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness (or a trustee
or representative on behalf of such holder), to establish that such notice has
been given by a holder of such Senior Indebtedness or a trustee or
representative on behalf of any such holder or holders. In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of such Senior Indebtedness to
participate in any payment or distribution pursuant to this Article XV,
the Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of such Senior Indebtedness held
by such Person, the extent to which such Person is entitled to participate in
such payment or distribution and any other facts pertinent to the rights of
such Person under this Article XV, and, if such evidence is not furnished,
the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.

 

Section 15.7.        Rights of the Trustee; Holders of Senior
Indebtedness. The Trustee in its individual capacity shall be
entitled to all the rights set forth in this Article XV in respect of any
Senior Indebtedness at any time held by it, to the same extent as any other
holder of Senior Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.

 

With
respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or
to observe only such of its covenants and obligations as are specifically set
forth in this Article XV, and no implied covenants or obligations with
respect to the holders of such Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be

 

56

 

deemed to owe any fiduciary duty to the holders of such Senior
Indebtedness and, subject to the provisions of Article VI of this
Indenture, the Trustee shall not be liable to any holder of such Senior
Indebtedness if it shall pay over or deliver to Securityholders, the Company or
any other Person money or assets to which any holder of such Senior
Indebtedness shall be entitled by virtue of this Article XV or otherwise.

 

Nothing
in this Article XV shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 6.6.

 

Section 15.8.        Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company, or by
any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company, with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have
or otherwise be charged with.

 

Without
in any way limiting the generality of the foregoing paragraph, the holders of
Senior Indebtedness may, at any time and from time to time, without the consent
of or notice to the Trustee or the Securityholders, without incurring
responsibility to the Securityholders and without impairing or releasing the
subordination provided in this Article XV or the obligations hereunder of
the holders of the Debentures to the holders of such Senior Indebtedness, do
any one or more of the following:  (i) change
the manner, place or terms of payment or extend the time of payment of, or
renew or alter, such Senior Indebtedness, or otherwise amend or supplement in
any manner such Senior Indebtedness or any instrument evidencing the same or
any agreement under which such Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Senior Indebtedness; (iii) release any Person
liable in any manner for the collection of such Senior Indebtedness; and (iv) exercise
or refrain from exercising any rights against the Company, and any other
Person.

 

Signatures
appear on the following page

 

57

 

IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed by their respective officers thereunto duly authorized, as of the day
and year first above written.

 

	
   

  	
  AMERICAN CAPITAL ACCESS HOLDINGS

  LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION, as

  Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

58

 

FORM OF
FLOATING RATE JUNIOR SUBORDINATED DEFERRABLE INTEREST

DEBENTURE

 

[FORM OF FACE OF SECURITY]

 

THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAW. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND ANY APPLICABLE STATE SECURITIES LAWS. THE HOLDER OF THIS SECURITY BY
ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY
ONLY (A) TO AMERICAN CAPITAL ACCESS HOLDINGS LIMITED (THE “COMPANY”), (B) PURSUANT
TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN
ACCORDANCE WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE)
OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF RULE 501
UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT,
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH THE INDENTURE, A COPY OF
WHICH MAY BE OBTAINED FROM THE COMPANY. HEDGING TRANSACTIONS INVOLVING
THIS SECURITY MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE
SECURITIES ACT.

 

THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND
WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), 
OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN
ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, AND NO PERSON
INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THE SECURITIES OR
ANY

 

A-1-1

 

INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR
EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION
CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE
EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOT PROHIBITED BY SECTION 406
OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR
HOLDING. ANY PURCHASER OR HOLDER OF THE SECURITIES OR ANY INTEREST THEREIN WILL
BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT
IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A
TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN,
OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR
PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT RESULT IN A
PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF
THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE
EXEMPTION.

 

THIS
SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN
AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000.00 AND MULTIPLES OF
$1,000.00 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK
HAVING AN AGGREGATE PRINCIPAL AMOUNT OF LESS THAN $100,000.00 SHALL BE DEEMED
TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.

 

THE
HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.

 

THIS
SECURITY IS IN REGISTERED FORM WITHIN THE MEANING OF TREASURY REGULATIONS SECTION 1.871-14(c)(1)(i) FOR
U.S. FEDERAL INCOME AND WITHHOLDING TAX PURPOSES.

 

IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED
BY THE INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.

 

Floating Rate Junior Subordinated Deferrable Interest
Debenture

 

of

 

American Capital Access Holdings Limited

 

October 29, 2003

 

American Capital Access Holdings Limited, a
corporation duly organized and existing under the laws of Bermuda (the “Company”
which term includes any successor Person under the Indenture hereinafter
referred to), for value received promises to pay to U.S. Bank National
Association, not in its individual capacity but solely as Institutional Trustee
for ACA Statutory

 

A-1-2

 

Trust III (the “Holder”) or
registered assigns, the principal sum of twenty million six hundred and
nineteen thousand dollars ($20,619,000.00) on October 29, 2033, and to pay
interest on said principal sum from October 29, 2003, or from the most
recent interest payment date (each such date, an “Interest Payment Date”) to
which interest has been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on January 29, April 29, July 29
and October 29 of each year commencing January 29, 2004, at an annual
rate equal to 5.110% beginning on (and including) the date of original issuance
and ending on (but excluding) January 29, 2004 and at an annual rate for
each successive period beginning on (and including) January 29, 2004, and
each succeeding Interest Payment Date, and ending on (but excluding) the next
succeeding Interest Payment Date (each a “Distribution Period”), equal to 3-Month
LIBOR, determined as described below, plus 3.950% (the “Coupon Rate”); provided,
however, that prior to October 29, 2008, the Coupon Rate shall not
exceed 12.450%, applied to the principal amount hereof, until the principal
hereof is paid or duly provided for or made available for payment, and on any
overdue principal and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment
of interest (including Additional Interest) at the Coupon Rate in effect for
each applicable period, compounded quarterly, from the dates such amounts are
due until they are paid or made available for payment. The amount of interest
payable for any period will be computed on the basis of the actual number of
days in the Distribution Period concerned divided by 360. In the event that any
date on which interest is payable on this Debenture is not a Business Day, then
a payment of the interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay), except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date the payment was originally payable. The interest
installment so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Debenture (or one or more Predecessor Securities) is
registered at the close of business on the regular record date for such
interest installment, which shall be fifteen days prior to the day on which the
relevant Interest Payment Date occurs. Any such interest installment not so
punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such regular record date and may be paid to the Person in whose
name this Debenture (or one or more Predecessor Securities) is registered at
the close of business on a special record date.

 

“3-Month LIBOR” as used herein, means the
London interbank offered interest rate for three-month U.S. dollar deposits
determined by the Trustee in the following order of priority:  (i) the rate (expressed as a percentage
per annum) for U.S. dollar deposits having a three-month maturity that appears
on Telerate Page 3750 as of 11:00 a.m. (London time) on the related
Determination Date (“Telerate Page 3750” means the display designated as “Page 3750”
on the Dow Jones Telerate Service or such other page as may replace Page 3750
on that service or such other service or services as may be nominated by
the British Bankers’ Association as the information vendor for the purpose of
displaying London interbank offered rates for U.S. dollar deposits); (ii) if
such rate cannot be identified on the related Determination Date, the Trustee
will request the principal London offices of four leading banks in the London
interbank market to provide such banks’ offered quotations (expressed as
percentages per annum) to prime banks in the London interbank market for U.S.
dollar deposits having a three-month maturity as of 11:00 a.m. (London
time) on such Determination Date. If at least two quotations are provided, 3-Month
LIBOR will be the arithmetic mean of such quotations; (iii) if fewer than
two such

 

A-1-3

 

quotations are provided as
requested in clause (ii) above, the Trustee will request four major New
York City banks to provide such banks’ offered quotations (expressed as
percentages per annum) to leading European banks for loans in U.S. dollars as
of 11:00 a.m. (London time) on such Determination Date. If at least two
such quotations are provided, 3-Month LIBOR will be the arithmetic mean of such
quotations; and (iv) if fewer than two such quotations are provided as
requested in clause (iii) above, 3-Month LIBOR will be a 3-Month LIBOR
determined with respect to the Distribution Period immediately preceding such
current Distribution Period. If the rate for U.S. dollar deposits having a
three-month maturity that initially appears on Telerate Page 3750 as of
11:00 a.m. (London time) on the related Determination Date is superseded
on the Telerate Page 3750 by a corrected rate by 12:00 noon (London time)
on such Determination Date, then the corrected rate as so substituted on the
applicable page will be the applicable 3-Month LIBOR for such
Determination Date. As used herein, “Determination Date” means the date that is
two London Banking Days (i.e., a business day in which dealings in deposits in
U.S. dollars are transacted in the London interbank market) preceding the
commencement of the relevant Distribution Period.

 

The Interest Rate for any Distribution Period
will at no time be higher than the maximum rate then permitted by New York law
as the same may be modified by United States law.

 

All percentages resulting from any
calculations on the Debentures will be rounded, if necessary, to the nearest
one hundred-thousandth of a percentage point, with five one-millionths of a
percentage point rounded upward (e.g., 9.876545% (or .09876545) being rounded
to 9.87655% (or .0987655), and all dollar amounts used in or resulting from
such calculation will be rounded to the nearest cent (with one-half cent being
rounded upward)).

 

The principal of and interest on this Debenture
shall be payable at the office or agency of the Trustee (or other paying agent
appointed by the Company) maintained for that purpose in any coin or currency
of the United States of America that at the time of payment is legal tender for
payment of public and private debts; provided, however, that
payment of interest may be made by check mailed to the registered holder
at such address as shall appear in the Debenture Register if a request for a
wire transfer by such holder has not been received by the Company or by wire
transfer to an account appropriately designated by the holder hereof. Notwithstanding
the foregoing, so long as the holder of this Debenture is the Institutional
Trustee, the payment of the principal of and interest on this Debenture will be
made in immediately available funds at such place and to such account as may be
designated by the Trustee.

 

So long as no Event of
Default has occurred and is continuing, the Company shall have the right, from
time to time, and without causing an Event of Default, to defer payments of
interest on the Debentures by extending the interest payment period on the
Debentures at any time and from time to time during the term of the Debentures,
for up to 20 consecutive quarterly periods (each such extended interest
payment period, an “Extension Period”), during which Extension Period no
interest (including Additional Interest) shall be due and payable (except any
Additional Sums that may be due and payable). No Extension Period may end
on a date other than an Interest Payment Date. During an Extension Period,
interest will continue to accrue on the Debentures, and interest on such
accrued interest will accrue at an annual rate equal to the Interest Rate in
effect for such Extension Period, compounded quarterly from the date such
interest would have been payable were it not for the Extension Period, to the
extent permitted by

 

A-1-4

 

law (such interest
referred to herein as “Additional Interest”). At the end of any such Extension
Period the Company shall pay all interest then accrued and unpaid on the
Debentures (together with Additional Interest thereon); provided, however,
that no Extension Period may extend beyond the Maturity Date; provided
further, however, that during any such Extension Period, the
Company shall not and shall not permit any Affiliate of the Company controlled
by the Company to engage in any of the activities or transactions described on
the reverse side hereof and in the Indenture. Prior to the termination of any
Extension Period, the Company may further extend such period, provided
that such period together with all such previous and further consecutive
extensions thereof shall not exceed 20 consecutive quarterly periods, or
extend beyond the Maturity Date. Upon the termination of any Extension Period
and upon the payment of all accrued and unpaid interest and Additional
Interest, the Company may commence a new Extension Period, subject to the
foregoing requirements. No interest or Additional Interest shall be due and
payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
an Extension Period shall bear Additional Interest. The Company must give the
Trustee notice of its election to begin or extend an Extension Period at least
5 Business Days prior to the regular record date (as such term is used in Section 2.8
of the Indenture) immediately preceding the Interest Payment Date with respect
to which interest on the Debentures would have been payable except for the
election to begin or extend an Extension Period.

 

The indebtedness
evidenced by this Debenture is, to the extent provided in the Indenture,
subordinate and junior in right of payment to the prior payment in full of all
Senior Indebtedness, and this Debenture is issued subject to the provisions of
the Indenture with respect thereto. Each holder of this Debenture, by accepting
the same, (a) agrees to and shall be bound by such provisions, (b) authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination so
provided and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each holder hereof, by his or her acceptance hereof,
hereby waives all notice of the acceptance of the subordination provisions
contained herein and in the Indenture by each holder of Senior Indebtedness,
whether now outstanding or hereafter incurred, and waives reliance by each such
holder upon said provisions.

 

This Debenture shall not
be entitled to any benefit under the Indenture hereinafter referred to, be
valid or become obligatory for any purpose until the certificate of
authentication hereon shall have been signed by or on behalf of the Trustee.

 

The provisions of this
Debenture are continued on the reverse side hereof and such provisions shall
for all purposes have the same effect as though fully set forth at this place.

 

A-1-5

 

IN WITNESS WHEREOF, the
Company has duly executed this certificate.

 

	
   

  	
  American Capital Access Holdings Limited

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

CERTIFICATE OF
AUTHENTICATION

 

This is one of the
Debentures referred to in the within-mentioned Indenture.

 

	
   

  	
  U. S. Bank, National Association, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  

 

A-1-6

 

[FORM OF REVERSE OF DEBENTURE]

 

This Debenture is one of the floating rate junior
subordinated deferrable interest debentures of the Company, all issued or to be
issued under and pursuant to the Indenture dated as of October 29, 2003
(the “Indenture”), duly executed and delivered between the Company and the
Trustee, to which Indenture reference is hereby made for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Trustee, the Company and the holders of the Debentures. The Debentures are
limited in aggregate principal amount as specified in the Indenture.

 

Upon the occurrence and continuation of a Special
Event prior to October 29, 2008, the Company shall have the right to
redeem the Debentures in whole, but not in part, at any Interest Payment Date,
within 120 days following the occurrence of such Special Event, at the Special
Redemption Price.

 

In addition, the Company shall have the right to
redeem the Debentures, in whole or in part, but in all cases in a principal
amount with integral multiples of $1,000.00, on any Interest Payment Date on or
after October 29, 2008, at the Optional Redemption Price.

 

Prior to 10:00 a.m. New York City time on the
Optional Redemption Date or Special Redemption Date, as applicable, the Company
will deposit with the Trustee or with one or more paying agents an amount of
money sufficient to redeem on the Optional Redemption Date or the Special
Redemption Date, as applicable, all the Debentures so called for redemption at
the appropriate Optional Redemption Price or Special Redemption Price.

 

If all, or less than all, the Debentures are to be
redeemed, the Company will give the Trustee notice not less than 45 nor more
than 60 days prior to the Optional Redemption Date or Special Redemption
Date, as applicable, as to the aggregate principal amount of Debentures to be
redeemed and the Trustee shall select, in such manner as in its sole discretion
it shall deem appropriate and fair, the Debentures or portions thereof (in
integral multiples of $1,000.00) to be redeemed.

 

Notwithstanding the foregoing, any redemption of
Debentures by the Company shall be subject to the receipt of any and all
required regulatory approvals.

 

In case an Event of Default shall have occurred and be
continuing, upon demand of the Trustee, the principal of all of the Debentures
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 consent of the holders of not less than a
majority in aggregate principal amount of the Debentures at the time
outstanding, to execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of any supplemental indenture or of modifying in any manner
the rights of the holders of the Debentures; provided, however,
that no such supplemental indenture shall without the consent of the holders of
each Debenture then outstanding and affected thereby (i) change the fixed
maturity of any Debenture, or reduce the principal amount thereof or any
premium thereon, or reduce the rate or extend the time of payment of interest
thereon, or reduce any amount

 

A-1-7

 

payable on redemption thereof or make the principal thereof or any
interest or premium thereon payable in any coin or currency other than that
provided in the Debentures, or impair or affect the right of any Securityholder
to institute suit for payment thereof or impair the right of repayment, if any,
at the option of the holder, or (ii) reduce the aforesaid percentage of
Debentures the holders of which are required to consent to any such
supplemental indenture.

 

The Indenture also contains provisions permitting the
holders of a majority in aggregate principal amount of the Debentures at the
time outstanding on behalf of the holders of all of the Debentures to waive (or
modify any previously granted waiver of) any past default or Event of Default,
and its consequences, except An Event of Default (a) specified in Sections
5.1(a) and (b), (b) in respect of covenants or provisions hereof or
of the Indenture which cannot be modified or amended without the consent of the
holder of each Debenture affected, or (c) in respect of the covenants
contained in Section 3.9 of the Indenture; provided, however,
that if the Debentures are held by the Trust or a trustee of the Trust, such
waiver or modification to such waiver shall not be effective until the holders
of a majority in Liquidation Amount of the Trust Securities shall have
consented to such waiver or modification to such waiver, provided, further,
that if the consent of the holder of each outstanding Debenture is required,
such waiver shall not be effective until each holder of the Trust Securities
shall have consented to such waiver. Upon any such waiver, the default covered
thereby shall be deemed to be cured for all purposes of the Indenture and the
Company, the Trustee and the holders of the Debentures shall be restored to
their former positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other default or Event of Default or impair
any right consequent thereon. Whenever any default or Event of Default
hereunder shall have been waived as permitted by the Indenture, said default or
Event of Default shall for all purposes of the Debentures and the Indenture be
deemed to have been cured and to be not continuing.

 

No reference herein to the Indenture and no provision
of this Debenture or of the Indenture shall alter or impair the obligation of
the Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest, including Additional Interest, on this Debenture
at the time and place and at the rate and in the money herein prescribed.

 

The Company has agreed that if Debentures are
initially issued to the Trust or a trustee of such Trust in connection with the
issuance of Trust Securities by the Trust (regardless of whether Debentures
continue to be held by such Trust) and (i) there shall have occurred and
be continuing an Event of Default, (ii) the Company shall be in default
with respect to its payment of any obligations under the Capital Securities
Guarantee, or (iii) the Company shall have given notice of its election to
defer payments of interest on the Debentures by extending the interest payment
period as provided herein and such Extension Period, or any extension thereof,
shall be continuing, then the Company shall not, and shall not permit any
Affiliate of the Company controlled by the Company 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 Company’s or such Affiliates’
capital stock (other than payments of dividends or distributions to the Company
or a Subsidiary of the Company) or make any guarantee payments with respect to
the foregoing or (y) make any payment of principal of or interest or
premium, if any, on or repay, repurchase or redeem any debt securities of the
Company or any Affiliate of the Company controlled by the Company that rank pari passu in all respects with or junior in interest to the
Debentures (other

 

A-1-8

 

than, with respect to clauses (x) and (y) above,  (1) repurchases, redemptions or other
acquisitions of shares of capital stock of the Company or any Subsidiary of the
Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Company or of such Subsidiary (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (2) as
a result of any exchange or conversion of any class or series of the
Company’s capital stock (or any capital stock of a Subsidiary of the Company)
for any class or series of the Company’s capital stock (or in the
case of a Subsidiary of the Company, any class or series of such
Subsidiary’s capital stock) or of any class or series of the Company’s
indebtedness for any class or series of the Company’s capital stock
(or in the case of indebtedness of a Subsidiary of the Company, of any class or
series of such Subsidiary’s indebtedness or any class or series of
such Subsidiary’s capital stock), (3) the purchase of fractional interests
in shares of the Company’s capital stock (or the capital stock of a Subsidiary
of the Company) pursuant to the conversion or exchange provisions of such
capital stock or the security being converted or exchanged, (4) any
declaration of a dividend in connection with any stockholders’ rights plan, or
the issuance of rights, stock or other property under any stockholders’ rights
plan, or the redemption or repurchase of rights pursuant thereto, (5) any
dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such stock
and any cash payments in lieu of fractional shares issued in connection
therewith, or (6) payments under the Capital Securities Guarantee).

 

The Debentures are issuable only in registered,
certificated form without coupons and in minimum denominations of
$100,000.00 and any multiple of $1,000.00 in excess thereof. As provided in the
Indenture and subject to the transfer restrictions and limitations as may be
contained herein and therein from time to time, this Debenture is transferable
by the holder hereof on the Debenture Register of the Company. Upon due
presentment for registration of transfer of any Debenture at the Principal
Office of the Trustee or at any office or agency of the Company maintained for
such purpose as provided in Section 3.2 of the Indenture, the Company
shall execute, the Company or the Trustee shall register and the Trustee or the
Authenticating Agent shall authenticate and make available for delivery in the
name of the transferee or transferees a new Debenture for a like aggregate
principal amount. All Debentures presented for registration of transfer or for
exchange or payment shall (if so required by the Company or the Trustee or the
Authenticating Agent) be duly endorsed by, or be accompanied by a written
instrument or instruments of transfer in form satisfactory to, the Company
and the Trustee or the Authenticating Agent duly executed by the holder or his
attorney duly authorized in writing. No service charge shall be made for any
exchange or registration of transfer of Debentures, but the Company or the
Trustee may require payment of a sum sufficient to cover any tax, fee or
other governmental charge that may be imposed in connection therewith.

 

Prior to due presentment for registration of transfer
of any Debenture, the Company, the Trustee, any Authenticating Agent, any paying
agent, any transfer agent and any Debenture registrar may deem the Person
in whose name such Debenture shall be registered upon the Debenture Register to
be, and may treat him as, the absolute owner of such Debenture (whether

 

A-1-9

 

or not such Debenture shall be overdue) for the purpose of receiving
payment of or on account of the principal of, premium, if any, and interest on
such Debenture and for all other purposes; and neither the Company nor the Trustee
nor any Authenticating Agent nor any paying agent nor any transfer agent nor
any Debenture registrar shall be affected by any notice to the contrary. All
such payments so made to any holder for the time being or upon his order shall
be valid, and, to the extent of the sum or sums so paid, effectual to satisfy
and discharge the liability for moneys payable upon any such Debenture.

 

The
Debentures are in registered form within the meaning of Treasury
Regulations Section 1.871-14(c)(1)(i) for U.S. federal income and
withholding tax purposes.

 

No recourse for the payment of the principal of or
premium, if any, or interest on any Debenture, or for any claim based thereon
or otherwise in respect thereof, and no recourse under or upon any obligation,
covenant or agreement of the Company in the Indenture or in any supplemental
indenture, or in any such Debenture, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, employee, officer or director, as such, past, present or future,
of the Company or of any successor Person of the Company, either directly or
through the Company or any successor Person of the Company, whether by virtue
of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of the Indenture and the issue of the
Debentures.

 

Capitalized terms used
and not defined in this Debenture shall have the meanings assigned in the
Indenture dated as of the date of original issuance of this Debenture between
the Trustee and the Company.

 

THE INDENTURE AND THE
DEBENTURES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF.

 

A-1-10Exhibit 10.5

 

 

 

AMERICAN
CAPITAL ACCESS HOLDINGS LIMITED,

as Issuer

 

 

 

 

INDENTURE

Dated as of
May 15, 2003

 

 

 

U.S. BANK
NATIONAL ASSOCIATION,

as Trustee

 

 

 

FLOATING RATE
JUNIOR SUBORDINATED 

DEFERRABLE
INTEREST DEBENTURES

 

 

DUE 2033

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I.

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.1.

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
  DEBENTURES

  	
  7

  
	
   

  	
   

  	
   

  
	
  Section 2.1.

  	
  Authentication
  and Dating

  	
  7

  
	
  Section 2.2.

  	
  Form of
  Trustee’s Certificate of Authentication

  	
  8

  
	
  Section 2.3.

  	
  Form and
  Denomination of Debentures

  	
  8

  
	
  Section 2.4.

  	
  Execution of
  Debentures

  	
  8

  
	
  Section 2.5.

  	
  Exchange and
  Registration of Transfer of Debentures

  	
  8

  
	
  Section 2.6.

  	
  Mutilated,
  Destroyed, Lost or Stolen Debentures

  	
  11

  
	
  Section 2.7.

  	
  Temporary
  Debentures

  	
  12

  
	
  Section 2.8.

  	
  Payment of
  Interest and Additional Interest

  	
  12

  
	
  Section 2.9.

  	
  Cancellation
  of Debentures Paid, etc

  	
  14

  
	
  Section 2.10.

  	
  Computation
  of Interest

  	
  14

  
	
  Section 2.11.

  	
  Extension of
  Interest Payment Period

  	
  16

  
	
  Section 2.12.

  	
  CUSIP
  Numbers

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
  PARTICULAR
  COVENANTS OF THE COMPANY

  	
  17

  
	
   

  	
   

  	
   

  
	
  Section 3.1.

  	
  Payment of
  Principal, Premium and Interest; Agreed Treatment of the Debentures

  	
  17

  
	
  Section 3.2.

  	
  Offices for
  Notices and Payments, etc

  	
  18

  
	
  Section 3.3.

  	
  Appointments
  to Fill Vacancies in Trustee’s Office

  	
  19

  
	
  Section 3.4.

  	
  Provision as
  to Paying Agent

  	
  19

  
	
  Section 3.5.

  	
  Certificate
  to Trustee

  	
  20

  
	
  Section 3.6.

  	
  Additional
  Sums

  	
  20

  
	
  Section 3.7.

  	
  Compliance
  with Consolidation Provisions

  	
  20

  
	
  Section 3.8.

  	
  Limitation
  on Dividends

  	
  20

  
	
  Section 3.9.

  	
  Covenants as
  to the Trust

  	
  21

  
	
  Section 3.10.

  	
  Additional
  Junior Indebtedness

  	
  21

  
	
  Section 3.11.

  	
  Consent to
  Jurisdiction and Venue

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
  SECURITYHOLDERS
  LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

  	
  22

  
	
   

  	
   

  	
   

  
	
  Section 4.1.

  	
  Securityholders
  Lists

  	
  22

  
	
  Section 4.2.

  	
  Preservation
  and Disclosure of Lists.

  	
  22

  
	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
  REMEDIES OF
  THE TRUSTEE AND SECURITYHOLDERS UPON AN EVENT OF DEFAULT

  	
  23

  
	
   

  	
   

  	
   

  
	
  Section 5.1.

  	
  Events of
  Default

  	
  23

  
	
  Section 5.2.

  	
  Payment of
  Debentures on Default; Suit Therefor

  	
  25

  
				

 

i

 

	
  Section 5.3.

  	
  Application
  of Moneys Collected by Trustee

  	
  27

  
	
  Section 5.4.

  	
  Proceedings
  by Securityholders

  	
  27

  
	
  Section 5.5.

  	
  Proceedings
  by Trustee

  	
  28

  
	
  Section 5.6.

  	
  Remedies
  Cumulative and Continuing; Delay or Omission Not a Waiver

  	
  28

  
	
  Section 5.7.

  	
  Direction of
  Proceedings and Waiver of Defaults by Majority of Securityholders

  	
  28

  
	
  Section 5.8.

  	
  Notice of
  Defaults

  	
  29

  
	
  Section 5.9.

  	
  Undertaking
  to Pay Costs

  	
  29

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
  CONCERNING
  THE TRUSTEE

  	
  30

  
	
   

  	
   

  	
   

  
	
  Section 6.1.

  	
  Duties and
  Responsibilities of Trustee

  	
  30

  
	
  Section 6.2.

  	
  Reliance on
  Documents, Opinions, etc

  	
  31

  
	
  Section 6.3.

  	
  No
  Responsibility for Recitals, etc

  	
  32

  
	
  Section 6.4.

  	
  Trustee,
  Authenticating Agent, Paying Agents, Transfer Agents or Registrar May Own
  Debentures

  	
  32

  
	
  Section 6.5.

  	
  Moneys to be
  Held in Trust

  	
  32

  
	
  Section 6.6.

  	
  Compensation
  and Expenses of Trustee

  	
  32

  
	
  Section 6.7.

  	
  Officers’
  Certificate as Evidence

  	
  33

  
	
  Section 6.8.

  	
  Eligibility
  of Trustee

  	
  33

  
	
  Section 6.9.

  	
  Resignation
  or Removal of Trustee

  	
  34

  
	
  Section 6.10.

  	
  Acceptance
  by Successor Trustee

  	
  35

  
	
  Section 6.11.

  	
  Succession
  by Merger, etc

  	
  36

  
	
  Section 6.12.

  	
  Authenticating
  Agents

  	
  36

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII.

  	
  CONCERNING
  THE SECURITYHOLDERS

  	
  37

  
	
   

  	
   

  	
   

  
	
  Section 7.1.

  	
  Action by
  Securityholders

  	
  37

  
	
  Section 7.2.

  	
  Proof of
  Execution by Securityholders

  	
  38

  
	
  Section 7.3.

  	
  Who Are
  Deemed Absolute Owners

  	
  38

  
	
  Section 7.4.

  	
  Debentures
  Owned by Company Deemed Not Outstanding

  	
  38

  
	
  Section 7.5.

  	
  Revocation
  of Consents; Future Holders Bound

  	
  39

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII.

  	
  SECURITYHOLDERS
  MEETINGS

  	
  39

  
	
   

  	
   

  	
   

  
	
  Section 8.1.

  	
  Purposes of
  Meetings

  	
  39

  
	
  Section 8.2.

  	
  Call of
  Meetings by Trustee

  	
  40

  
	
  Section 8.3.

  	
  Call of
  Meetings by Company or Securityholders

  	
  40

  
	
  Section 8.4.

  	
  Qualifications
  for Voting

  	
  40

  
	
  Section 8.5.

  	
  Regulations

  	
  40

  
	
  Section 8.6.

  	
  Voting

  	
  41

  
	
  Section 8.7.

  	
  Quorum;
  Actions

  	
  41

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX.

  	
  SUPPLEMENTAL
  INDENTURES

  	
  42

  
	
   

  	
   

  	
   

  
	
  Section 9.1.

  	
  Supplemental
  Indentures without Consent of Securityholders

  	
  42

  
	
  Section 9.2.

  	
  Supplemental
  Indentures with Consent of Securityholders

  	
  43

  
	
  Section 9.3.

  	
  Effect of
  Supplemental Indentures

  	
  44

  
				

 

ii

 

	
  Section 9.4.

  	
  Notation on
  Debentures

  	
  44

  
	
  Section 9.5.

  	
  Evidence of
  Compliance of Supplemental Indenture to be Furnished to Trustee

  	
  45

  
	
   

  	
   

  	
   

  
	
  ARTICLE X.

  	
  REDEMPTION
  OF SECURITIES

  	
  45

  
	
   

  	
   

  	
   

  
	
  Section 10.1.

  	
  Optional
  Redemption

  	
  45

  
	
  Section 10.2.

  	
  Special
  Event Redemption

  	
  45

  
	
  Section 10.3.

  	
  Notice of
  Redemption; Selection of Debentures

  	
  45

  
	
  Section 10.4.

  	
  Payment of
  Debentures Called for Redemption

  	
  46

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI.

  	
  CONSOLIDATION,
  MERGER, SALE, CONVEYANCE AND LEASE

  	
  46

  
	
   

  	
   

  	
   

  
	
  Section 11.1.

  	
  Company May
  Consolidate, etc., on Certain Terms

  	
  46

  
	
  Section 11.2.

  	
  Successor
  Entity to be Substituted

  	
  47

  
	
  Section 11.3.

  	
  Opinion of
  Counsel to be Given to Trustee

  	
  47

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII.

  	
  SATISFACTION
  AND DISCHARGE OF INDENTURE

  	
  47

  
	
   

  	
   

  	
   

  
	
  Section 12.1.

  	
  Discharge of
  Indenture

  	
  47

  
	
  Section 12.2.

  	
  Deposited
  Moneys to be Held in Trust by Trustee

  	
  48

  
	
  Section 12.3.

  	
  Paying Agent
  to Repay Moneys Held

  	
  48

  
	
  Section 12.4.

  	
  Return of
  Unclaimed Moneys

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XIII.

  	
  IMMUNITY OF
  INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

  	
  49

  
	
   

  	
   

  	
   

  
	
  Section 13.1.

  	
  Indenture
  and Debentures Solely Corporate Obligations

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIV.

  	
  MISCELLANEOUS
  PROVISIONS

  	
  49

  
	
   

  	
   

  	
   

  
	
  Section 14.1.

  	
  Successors

  	
  49

  
	
  Section 14.2.

  	
  Official
  Acts by Successor Entity

  	
  49

  
	
  Section 14.3.

  	
  Surrender of
  Company Powers

  	
  49

  
	
  Section 14.4.

  	
  Addresses for
  Notices, etc

  	
  49

  
	
  Section 14.5.

  	
  Governing
  Law

  	
  50

  
	
  Section 14.6.

  	
  Evidence of
  Compliance with Conditions Precedent

  	
  50

  
	
  Section 14.7.

  	
  Non-Business
  Days

  	
  50

  
	
  Section 14.8.

  	
  Table of
  Contents, Headings, etc

  	
  50

  
	
  Section 14.9.

  	
  Execution in
  Counterparts

  	
  51

  
	
  Section 14.10.

  	
  Separability

  	
  51

  
	
  Section 14.11.

  	
  Assignment

  	
  51

  
	
  Section 14.12.

  	
  Acknowledgment
  of Rights

  	
  51

  
	
  Section 14.13.

  	
  Submission
  to Jurisdiction; Appointment of Agent for Service

  	
  51

  
	
  Section 14.14.

  	
  Judgment
  Currency

  	
  52

  
	
  Section 14.15.

  	
  Waiver of
  Immunity

  	
  52

  
	
   

  	
   

  	
   

  
	
  ARTICLE XV.

  	
  SUBORDINATION
  OF DEBENTURES

  	
  53

  
	
   

  	
   

  	
   

  
	
  Section 15.1.

  	
  Agreement to
  Subordinate

  	
  53

  
				

 

iii

 

	
  Section 15.2.

  	
  Default on
  Senior Indebtedness

  	
  53

  
	
  Section 15.3.

  	
  Liquidation,
  Dissolution, Bankruptcy

  	
  53

  
	
  Section 15.4.

  	
  Subrogation

  	
  55

  
	
  Section 15.5.

  	
  Trustee to
  Effectuate Subordination

  	
  55

  
	
  Section 15.6.

  	
  Notice by
  the Company

  	
  56

  
	
  Section 15.7.

  	
  Rights of
  the Trustee; Holders of Senior Indebtedness

  	
  56

  
	
  Section 15.8.

  	
  Subordination
  May Not Be Impaired

  	
  57

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  Form of
  Junior Subordinated Deferrable Interest Debenture

  	
   

  
				

 

iv

 

THIS INDENTURE, dated as of May 15, 2003, between American Capital
Access Holdings Limited, a Bermuda corporation (the “Company”), and U.S.
Bank National Association, a national banking association organized under the
laws of the United States of America, as debenture trustee (the “Trustee”).

 

WITNESSETH:

 

WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issuance of its Floating Rate Junior Subordinated Deferrable
Interest Debentures due 2033 (the “Debentures”) under this Indenture to
provide, among other things, for the execution and authentication, delivery and
administration thereof, and the Company has duly authorized the execution of
this Indenture; and

 

WHEREAS, all acts and things necessary to make this Indenture a valid
agreement according to its terms, have been done and performed;

 

NOW, THEREFORE, This Indenture Witnesseth:

 

In consideration of the premises, and the purchase of the Debentures by
the holders thereof, the Company covenants and agrees with the Trustee for the
equal and proportionate benefit of the respective holders from time to time of
the Debentures as follows:

 

ARTICLE I.

DEFINITIONS

 

Section 1.1.           Definitions.  The terms defined in this
Section 1.1 (except as herein otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Indenture and of any
indenture supplemental hereto shall have the respective meanings specified in
this Section 1.1.  All accounting
terms used herein and not expressly defined shall have the meanings assigned to
such terms in accordance with generally accepted accounting principles and the
term “generally accepted accounting principles” means such accounting
principles as are generally accepted in the United States at the time of any
computation.  The words “herein,”
“hereof” and “hereunder” and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.

 

“Additional Interest” has the meaning set forth in Section 2.11.

 

“Additional Junior Indebtedness” means, without duplication and
other than the Debentures, any indebtedness, liabilities or obligations of the
Company, or any Subsidiary of the Company, under debt securities (or guarantees
in respect of debt securities) initially issued after the date of this
Indenture to any trust, or a trustee of a trust, partnership or other entity
affiliated with the Company that is, directly or indirectly, a finance
subsidiary (as such term is defined in Rule 3a-5 under the Investment Company
Act of 1940) or other financing vehicle of the Company or any Subsidiary of the
Company in connection with the issuance by that entity of preferred securities
or other securities that are issued on a pari passu basis with the Debentures.

 

“Additional Sums” has the meaning set forth in Section 3.6.

 

1

 

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

 

“Authenticating Agent” means any agent or agents of the Trustee
which at the time shall be appointed and acting pursuant to Section 6.12.

 

“Bankruptcy Law” means Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.

 

“Board of Directors” means the board of directors or the
executive committee or any other duly authorized designated officers of the
Company.

 

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

 

“Business Day” means any day other than a Saturday, Sunday or
any other day on which banking institutions in New York City or Hartford,
Connecticut are permitted or required by any applicable law to close.

 

“Capital Securities” means undivided beneficial interests in the
assets of the Trust which rank pari
passu with Common Securities
issued by the Trust; provided, however, that upon the occurrence
and continuance of an Event of Default (as defined in the Declaration), the
rights of holders of such Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and otherwise are
subordinated to the rights of holders of such Capital Securities.

 

“Capital Securities Guarantee” means the guarantee agreement
that the Company enters into with U.S. Bank National Association, as guarantee
trustee, or other Persons that operates directly or indirectly for the benefit
of holders of Capital Securities of the Trust.

 

“Certificate” means a certificate signed by any one of the
principal executive officer, the principal financial officer or the principal
accounting officer of the Company.

 

“Common Securities” means undivided beneficial interests in the
assets of the Trust which rank pari passu
with Capital Securities issued by the Trust; provided, however,
that upon the occurrence and continuance of an Event of Default (as defined in
the Declaration), the rights of holders of such Common Securities to payment in
respect of distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of holders of such Capital Securities.

 

“Company” means American Capital Access Holdings Limited, a
Bermuda corporation, and, subject to the provisions of Article XI, shall
include its successors and assigns.

 

“Coupon Rate” has the meaning set forth in Section 2.8.

 

“Debenture” or “Debentures” has the meaning stated in the
first recital of this Indenture.

 

2

 

“Debenture Register” has the meaning specified in
Section 2.5.

 

“Declaration” means the Amended and Restated Declaration of
Trust of the Trust, as amended or supplemented from time to time.

 

“Default” means any event, act or condition that with notice or
lapse of time, or both, would constitute an Event of Default.

 

“Defaulted Interest” has the meaning set forth in
Section 2.8.

 

“Distribution Period” has the meaning set forth in
Section 2.8.

 

“Determination Date” has the meaning set forth in
Section 2.10.

 

“Event of Default” means any event specified in
Section 5.1, continued for the period of time, if any, and after the
giving of the notice, if any, therein designated.

 

“Extension Period” has the meaning set forth in
Section 2.11.

 

“Indenture” means this instrument as originally executed or, if
amended or supplemented as herein provided, as so amended or supplemented, or
both.

 

“Institutional Trustee” has the meaning set forth in the
Declaration.

 

“Interest Payment Date” means each August 15, November 15,
February 15 and May 15 during the term of this Indenture.

 

“Interest Rate” means for the period beginning on (and
including) the date of original issuance and ending on (but excluding) August
15, 2003 the rate per annum of 5.41125% and for each Distribution Period
thereafter, the Coupon Rate.

 

“Investment Company Event” means the receipt by the Company and
the Trust of an opinion of counsel experienced in such matters to the effect
that, as a result of the occurrence of a change in law or regulation or written
change (including any announced prospective change) in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, there is more than an insubstantial risk that
the Trust is or, within 90 days of the date of such opinion will be considered
an “investment company” that is required to be registered under the Investment
Company Act of 1940, as amended which change or prospective change becomes
effective or would become effective, as the case may be, on or after the date
of the issuance of the Debentures.

 

“Liquidation Amount” means the stated amount of $1,000.00 per
Trust Security.

 

“Maturity Date” means May 15, 2033.

 

“Officers’ Certificate” means a certificate signed by the Chief
Executive Officer, the Vice Chairman, the President, any Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary
of the Company, and delivered to the Trustee. 
Each such 

 

3

 

certificate shall include the
statements provided for in Section 14.6 if and to the extent required by
the provisions of such Section.

 

“Opinion of Counsel” means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company, or may be other
counsel reasonably satisfactory to the Trustee. 
Each such opinion shall include the statements provided for in
Section 14.6 if and to the extent required by the provisions of such
Section.

 

“Optional Redemption Date” has the meaning set forth in
Section 10.1.

 

“Optional Redemption Price” means 100% of the principal amount
of the Debentures being redeemed, plus accrued and unpaid interest (including
any Additional Interest) on such Debentures to the Optional Redemption Date.

 

The term “outstanding,” when used with reference to Debentures,
means, subject to the provisions of Section 7.4, as of any particular
time, all Debentures authenticated and delivered by the Trustee or the
Authenticating Agent under this Indenture, except:

 

(a)           Debentures theretofore
canceled by the Trustee or the Authenticating Agent or delivered to the Trustee
for cancellation;

 

(b)           Debentures, or portions
thereof, for the payment or redemption of which moneys in the necessary amount
shall have been deposited in trust with the Trustee or with any paying agent
(other than the Company) or shall have been set aside and segregated in trust
by the Company (if the Company shall act as its own paying agent); provided,
however, that, if such Debentures, or portions thereof, are to be
redeemed prior to maturity thereof, notice of such redemption shall have been
given as provided in Section 10.3 or provision satisfactory to the Trustee
shall have been made for giving such notice; and

 

(c)           Debentures paid
pursuant to Section 2.6 or in lieu of or in substitution for which other
Debentures shall have been authenticated and delivered pursuant to the terms of
Section 2.6 unless proof satisfactory to the Company and the Trustee is
presented that any such Debentures are held by bona fide holders in due course.

 

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

 

“Predecessor Security” of any particular Debenture means every
previous Debenture evidencing all or a portion of the same debt as that
evidenced by such particular Debenture; and, for purposes of this definition,
any Debenture authenticated and delivered under Section 2.6 in lieu of a lost,
destroyed or stolen Debenture shall be deemed to evidence the same debt as the
lost, destroyed or stolen Debenture.

 

“Principal Office of the Trustee,” or other similar term, means
the office of the Trustee, at which at any particular time its corporate trust
business shall be principally administered, which at the time of the execution
of this Indenture shall be 225 Asylum Street, Goodwin Square, Hartford,
Connecticut  06103.

 

4

 

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

 

“Securities Act” means the Securities Act of 1933, as amended
from time to time or any successor legislation.

 

“Securityholder,” “holder of Debentures,” or other similar
terms, means any Person in whose name at the time a particular Debenture is
registered on the register kept by the Company or the Trustee for that purpose
in accordance with the terms hereof.

 

“Senior Indebtedness” means, with respect to the Company,
(i) the principal, premium, if any, and interest in respect of
(A) indebtedness of the Company for money borrowed and
(B) indebtedness evidenced by securities, debentures, notes, bonds or
other similar instruments issued by the Company; (ii) all capital lease
obligations of the Company; (iii) all obligations of the Company issued or
assumed as the deferred purchase price of property, all conditional sale
obligations of the Company and all obligations of the Company under any title
retention agreement; (iv) all obligations of the Company for the reimbursement
of any letter of credit, any banker’s acceptance, any security purchase
facility, any repurchase agreement or similar arrangement, any interest rate
swap, any other hedging arrangement, any obligation under options or any
similar credit or other transaction; (v) all obligations of the type
referred to in clauses (i) through (iv) above of other Persons for the
payment of which the Company is responsible or liable as obligor, guarantor or
otherwise; and (vi) all obligations of the type referred to in
clauses (i) through (v) above of other Persons secured by any lien on any
property or asset of the Company (whether or not such obligation is assumed by
the Company), whether incurred on or prior to the date of this Indenture or
thereafter incurred.  Notwithstanding the
foregoing, “Senior Indebtedness” shall not include (1) any Additional
Junior Indebtedness, (2) Debentures issued pursuant to this Indenture and
guarantees in respect of such Debentures, (3) trade accounts payable of the
Company arising in the ordinary course of business (such trade accounts payable
being pari passu in right of
payment to the Debentures), or (4) obligations with respect to which (a) in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such obligations are pari passu, junior or otherwise not
superior in right of payment to the Debentures and (b) the Company, prior to
the issuance thereof, has, if required, notified the relevant state insurance
regulatory agency.  Senior Indebtedness
shall continue to be Senior Indebtedness and be entitled to the subordination
provisions irrespective of any amendment, modification or waiver of any term of
such Senior Indebtedness.

 

“Special Event” means either of an Investment Company Event or a
Tax Event.

 

“Special Redemption Date” has the meaning set forth in Section
10.2.

 

5

 

“Special Redemption Price” means (i) 107.5% of the
principal amount of the Debentures being redeemed on a Special Redemption Date
that occurs before May 15, 2008 and (ii) 100% of the principal amount of the
Debentures being redeemed on a Special Redemption Date that occurs on May 15,
2008 or after, plus accrued and unpaid interest (including any Additional
Interest) on such Debentures to the Special Redemption Date.

 

“Subsidiary” means with respect to any Person, (i) any
corporation at least a majority of the outstanding voting stock of which is
owned, directly or indirectly, by such Person or by one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries,
(ii) any general partnership, joint venture or similar entity, at least a
majority of the outstanding partnership or similar interests of which shall at
the time be owned by such Person, or by one or more of its Subsidiaries, or by
such Person and one or more of its Subsidiaries and (iii) any limited
partnership of which such Person or any of its Subsidiaries is a general
partner.  For the purposes of this
definition, “voting stock” means shares, interests, participations or other
equivalents in the equity interest (however designated) in such Person having
ordinary voting power for the election of a majority of the directors (or the
equivalent) of such Person, other than shares, interests, participations or
other equivalents having such power only by reason of the occurrence of a
contingency.

 

“Tax Event” means the receipt by the Company and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to or change (including any announced prospective change) in
the laws or any regulations thereunder of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement (including any private letter ruling,
technical advice memorandum, field service advice, regulatory procedure, notice
or announcement, including any notice or announcement of intent to adopt such
procedures or regulations (an “Administrative Action”)) or judicial
decision interpreting or applying such laws or regulations, regardless of
whether such Administrative Action or judicial decision is issued to or in
connection with a proceeding involving the Company or the Trust and whether or
not subject to review or appeal, which amendment, clarification, change,
Administrative Action or decision is enacted, promulgated or announced, in each
case on or after the date of original issuance of the Debentures, there is more
than an insubstantial risk that: 
(i) the Trust is, or will be within 90 days of the date of
such opinion, subject to United States federal income tax with respect to
income received or accrued on the Debentures; (ii) interest payable by the
Company on the Debentures is not, or within 90 days of the date of such
opinion, will not be, deductible by the Company, in whole or in part, for
United States federal income tax purposes; or (iii) the Trust is, or will
be within 90 days of the date of such opinion, subject to more than a de
minimis amount of other taxes (excluding withholding taxes), duties or other
governmental charges.

 

“3-Month LIBOR” has the meaning set forth in Section 2.10.

 

“Telerate Page 3750” has the meaning set forth in Section 2.10.

 

“Trust” shall mean ACA Statutory Trust II, a Connecticut
statutory trust, or any other similar trust created for the purpose of issuing
Capital Securities in connection with the issuance of Debentures under this
Indenture, of which ACA Financial Assets, L.L.C., a Delaware limited liability
company, which is a wholly-owned subsidiary of the Company, is the sponsor.

 

6

 

“Trust Securities” means Common Securities and Capital
Securities of the Trust.

 

“Trustee” means U.S. Bank National Association, and, subject to
the provisions of Article VI hereof, shall also include its successors and
assigns as Trustee hereunder.

 

ARTICLE II.

DEBENTURES

 

Section 2.1.           Authentication and Dating.  Upon the execution and delivery of this
Indenture, or from time to time thereafter, Debentures in an aggregate
principal amount not in excess of $20,619,000.00 may be executed and delivered
by the Company to the Trustee for authentication, and the Trustee shall
thereupon authenticate and make available for delivery said Debentures to or upon
the written order of the Company, signed by its Chief Executive Officer, the
President, or one of its Vice Presidents without any further action by the
Company hereunder.  In authenticating
such Debentures, and accepting the additional responsibilities under this
Indenture in relation to such Debentures, the Trustee shall be entitled to
receive, and (subject to Section 6.1) shall be fully protected in relying
upon:

 

(a)           a copy of any
Board Resolution or Board Resolutions relating thereto and, if applicable, an
appropriate record of any action taken pursuant to such resolution, in each
case certified by the Secretary or an Assistant Secretary of the Company, as
the case may be; and

 

(b)           an Opinion of
Counsel prepared in accordance with Section 14.6 which shall also state:

 

(1) 
that such Debentures, when authenticated and delivered by the Trustee
and issued by the Company in each case in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company, subject to or limited by applicable
bankruptcy, insolvency, reorganization, conservatorship, receivership,
moratorium and other statutory or decisional laws relating to or affecting
creditors’ rights or the reorganization of financial institutions (including,
without limitation, preference and fraudulent conveyance or transfer laws),
heretofore or hereafter enacted or in effect, affecting the rights of creditors
generally; and

 

(2) 
that all laws and requirements in respect of the execution and delivery
by the Company of the Debentures have been complied with and that
authentication and delivery of the Debentures by the Trustee will not violate
the terms of this Indenture.

 

The Trustee shall have the right to decline to authenticate and deliver
any Debentures under this Section if the Trustee, being advised in writing by
counsel, determines that such action may not lawfully be taken or if a
Responsible Officer of the Trustee in good faith shall determine that such
action would expose the Trustee to personal liability to existing holders.

 

The definitive Debentures shall be typed, printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Debentures, as evidenced by their
execution of such Debentures.

 

7

 

Section 2.2.           Form of Trustee’s Certificate of Authentication.  The Trustee’s certificate of authentication
on all Debentures shall be in substantially the following form:

 

This is one of the Debentures referred to in the within-mentioned
Indenture.

 

	
  U.S. Bank National Association, as Trustee

  
	
   

  
	
  By

  	
   

  	
   

  
	
  Authorized Signer

  

 

Section 2.3.           Form and Denomination of Debentures.  The Debentures shall be substantially in the
form of Exhibit A attached hereto.  The
Debentures shall be in registered, certificated form without coupons and in
minimum denominations of $100,000.00 and any multiple of $1,000.00 in excess
thereof.  Any attempted transfer of the
Debentures in a block having an aggregate principal amount of less than
$100,000.00 shall be deemed to be void and of no legal effect whatsoever.  Any such purported transferee shall be deemed
not to be a holder of such Debentures for any purpose, including, but not
limited to the receipt of payments on such Debentures, and such purported
transferee shall be deemed to have no interest whatsoever in such
Debentures.  The Debentures shall be
numbered, lettered, or otherwise distinguished in such manner or in accordance
with such plans as the officers executing the same may determine with the
approval of the Trustee as evidenced by the execution and authentication
thereof.

 

Section 2.4.           Execution of Debentures.  The Debentures shall be signed in the name
and on behalf of the Company by the manual or facsimile signature of its Chief
Executive Officer, President, or one of its Executive Vice Presidents, Senior
Vice Presidents or Vice Presidents.  Only
such Debentures as shall bear thereon a certificate of authentication substantially
in the form herein before recited, executed by the Trustee or the
Authenticating Agent by the manual signature of an authorized signer, shall be
entitled to the benefits of this Indenture or be valid or obligatory for any
purpose.  Such certificate by the Trustee
or the Authenticating Agent upon any Debenture executed by the Company shall be
conclusive evidence that the Debenture so authenticated has been duly
authenticated and delivered hereunder and that the holder is entitled to the
benefits of this Indenture.

 

In case any officer of the Company who shall have signed any of the
Debentures shall cease to be such officer before the Debentures so signed shall
have been authenticated and delivered by the Trustee or the Authenticating
Agent, or disposed of by the Company, such Debentures nevertheless may be
authenticated and delivered or disposed of as though the Person who signed such
Debentures had not ceased to be such officer of the Company; and any Debenture
may be signed on behalf of the Company by such Persons as, at the actual date
of the execution of such Debenture, shall be the proper officers of the
Company, although at the date of the execution of this Indenture any such
person was not such an officer.

 

Every Debenture shall be dated the date of its authentication.

 

Section 2.5.           Exchange and Registration of Transfer of Debentures.  The Company shall cause to be kept, at
the office or agency maintained for the purpose of registration of transfer and
for exchange as provided in Section 3.2, a register (the “Debenture
Register”) for the Debentures issued hereunder in which, subject to such
reasonable regulations as it may prescribe, 

 

8

 

the Company shall provide for the registration and
transfer of all Debentures as in this Article II provided.  The Debenture Register shall be in written
form or in any other form capable of being converted into written form within a
reasonable time.

 

Debentures to be exchanged may be surrendered at the Principal Office
of the Trustee or at any office or agency to be maintained by the Company for
such purpose as provided in Section 3.2, and the Company shall execute,
the Company or the Trustee shall register and the Trustee or the Authenticating
Agent shall authenticate and make available for delivery in exchange therefor
the Debenture or Debentures which the Securityholder making the exchange shall
be entitled to receive.  Upon due
presentment for registration of transfer of any Debenture at the Principal
Office of the Trustee or at any office or agency of the Company maintained for
such purpose as provided in Section 3.2, the Company shall execute, the
Company or the Trustee shall register and the Trustee or the Authenticating
Agent shall authenticate and make available for delivery in the name of the
transferee or transferees a new Debenture for a like aggregate principal
amount.  Registration or registration of
transfer of any Debenture by the Trustee or by any agent of the Company
appointed pursuant to Section 3.2, and delivery of such Debenture, shall
be deemed to complete the registration or registration of transfer of such
Debenture.

 

All Debentures presented for registration of transfer or for exchange
or payment shall (if so required by the Company or the Trustee or the
Authenticating Agent) be duly endorsed by, or be accompanied by a written
instrument or instruments of transfer in form satisfactory to the Company and
the Trustee or the Authenticating Agent duly executed by the holder or his
attorney duly authorized in writing.

 

No service charge shall be made for any exchange or registration of
transfer of Debentures, but the Company or the Trustee may require payment of a
sum sufficient to cover any tax, fee or other governmental charge that may be
imposed in connection therewith.

 

The Company or the Trustee shall not be required to exchange or
register a transfer of any Debenture for a period of 15 days next
preceding the date of selection of Debentures for redemption.

 

Notwithstanding anything herein to the contrary, Debentures may not be
transferred except in compliance with the restricted securities legend set
forth below, unless otherwise determined by the Company, upon the advice of
counsel expert in securities law, in accordance with applicable law:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAW.  NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.  THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER THIS SECURITY ONLY (A) TO THE COMPANY, 

 

9

 

(B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A
SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A IN ACCORDANCE
WITH RULE 144A, (D) TO A NON-U.S. PERSON IN AN OFFSHORE TRANSACTION
IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE) OF
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF
RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS
OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR,
FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR
(F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH
THE INDENTURE, A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY.

 

THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES,
REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)
(EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY
REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING “PLAN
ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THE SECURITIES OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR EXEMPTIVE RELIEF AVAILABLE
UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60,
91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND
HOLDING OF THIS SECURITY IS NOT PROHIBITED BY SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING.  ANY PURCHASER OR HOLDER OF THE SECURITIES OR
ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND
HOLDING THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN
THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975
OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN
EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS
OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR
(ii) SUCH PURCHASE WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS
NO APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

 

10

 

THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING AN AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000.00 AND MULTIPLES
OF $1,000.00 IN EXCESS THEREOF.  ANY
ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING AN AGGREGATE PRINCIPAL
AMOUNT OF LESS THAN $100,000.00 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL
EFFECT WHATSOEVER.

 

THE HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE
FOREGOING RESTRICTIONS.

 

THIS SECURITY IS IN REGISTERED FORM WITHIN THE MEANING OF TREASURY
REGULATIONS SECTION 1.871-14(c)(1)(i) FOR U.S. FEDERAL INCOME AND WITHHOLDING
TAX PURPOSES.

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATE AND OTHER INFORMATION AS MAY BE
REQUIRED BY THE INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS.

 

Section 2.6.           Mutilated, Destroyed, Lost or Stolen Debentures.  In case any Debenture shall become mutilated
or be destroyed, lost or stolen, the Company shall execute, and upon its
written request the Trustee shall authenticate and deliver, a new Debenture
bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated Debenture, or in lieu of and in substitution for
the Debenture so destroyed, lost or stolen. 
In every case the applicant for a substituted Debenture shall furnish to
the Company and the Trustee such security or indemnity as may be required by
them to save each of them harmless, and, in every case of destruction, loss or
theft, the applicant shall also furnish to the Company and the Trustee evidence
to their satisfaction of the destruction, loss or theft of such Debenture and
of the ownership thereof.

 

The Trustee may authenticate any such substituted Debenture and deliver
the same upon the written request or authorization of any officer of the
Company.  Upon the issuance of any
substituted Debenture, the Company may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses connected therewith.  In case any Debenture which has matured or is
about to mature or has been called for redemption in full shall become
mutilated or be destroyed, lost or stolen, the Company may, instead of issuing
a substitute Debenture, pay or authorize the payment of the same (without
surrender thereof except in the case of a mutilated Debenture) if the applicant
for such payment shall furnish to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless and, in case
of destruction, loss or theft, evidence satisfactory to the Company and to the
Trustee of the destruction, loss or theft of such Debenture and of the
ownership thereof.

 

Every substituted Debenture issued pursuant to the provisions of this
Section 2.6 by virtue of the fact that any such Debenture is destroyed,
lost or stolen shall constitute an additional contractual obligation of the
Company, whether or not the destroyed, lost or stolen Debenture shall be found
at any time, and shall be entitled to all the benefits of this Indenture 

 

11

 

equally and proportionately
with any and all other Debentures duly issued hereunder.  All Debentures shall be held and owned upon
the express condition that, to the extent permitted by applicable law, the
foregoing provisions are exclusive with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Debentures and shall preclude any and
all other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.

 

Section 2.7.           Temporary Debentures.  Pending the preparation of definitive
Debentures, the Company may execute and the Trustee shall authenticate and make
available for delivery temporary Debentures that are typed, printed or
lithographed.  Temporary Debentures shall
be issuable in any authorized denomination, and substantially in the form of
the definitive Debentures in lieu of which they are issued but with such
omissions, insertions and variations as may be appropriate for temporary Debentures,
all as may be determined by the Company. 
Every such temporary Debenture shall be executed by the Company and be
authenticated by the Trustee upon the same conditions and in substantially the
same manner, and with the same effect, as the definitive Debentures.  Without unreasonable delay the Company will
execute and deliver to the Trustee or the Authenticating Agent definitive
Debentures and thereupon any or all temporary Debentures may be surrendered in
exchange therefor, at the principal corporate trust office of the Trustee or at
any office or agency maintained by the Company for such purpose as provided in
Section 3.2, and the Trustee or the Authenticating Agent shall
authenticate and make available for delivery in exchange for such temporary Debentures
a like aggregate principal amount of such definitive Debentures.  Such exchange shall be made by the Company at
its own expense and without any charge therefor except that in case of any such
exchange involving a registration of transfer the Company may require payment
of a sum sufficient to cover any tax, fee or other governmental charge that may
be imposed in relation thereto.  Until so
exchanged, the temporary Debentures shall in all respects be entitled to the
same benefits under this Indenture as definitive Debentures authenticated and
delivered hereunder.

 

Section 2.8.           Payment of Interest and Additional Interest.  Interest at the Interest Rate and any
Additional Interest on any Debenture that is payable, and is punctually paid or
duly provided for, on any Interest Payment Date for Debentures shall be paid to
the Person in whose name said Debenture (or one or more Predecessor Securities)
is registered at the close of business on the regular record date for such
interest installment except that interest and any Additional Interest payable
on the Maturity Date shall be paid to the Person to whom principal is paid.

 

Each Debenture shall bear interest for the period beginning on (and
including) the date of original issuance and ending on (but excluding) August
15, 2003 at a rate per annum of 5.41125%, and shall bear interest for each
successive period beginning on (and including) August 15, 2003, and each
succeeding Interest Payment Date, and ending on (but excluding) the next
succeeding Interest Payment Date (each, a “Distribution Period”) at a
rate per annum equal to the 3-Month LIBOR, determined as described in
Section 2.10, plus 4.10% (the “Coupon Rate”); provided, however,
that prior to May 15, 2008, the Coupon Rate shall not exceed 12.50%, applied to
the principal amount thereof, until the principal thereof becomes due and
payable, and on any overdue principal and to the extent that payment of such
interest is enforceable under applicable law (without duplication) on any
overdue installment of interest 

 

12

 

(including Additional Interest)
at the Interest Rate in effect for each applicable period compounded
quarterly.  Interest shall be payable
(subject to any relevant Extension Period) quarterly in arrears on each
Interest Payment Date with the first installment of interest to be paid on
August 15, 2003.

 

Any interest on any Debenture, including Additional Interest, that is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date (herein called “Defaulted Interest”) shall forthwith cease
to be payable to the registered holder on the relevant regular record date by
virtue of having been such holder; and such Defaulted Interest shall be paid by
the Company to the Persons in whose names such Debentures (or their respective
Predecessor Securities) are registered at the close of business on a special
record date for the payment of such Defaulted Interest, which shall be fixed in
the following manner: the Company shall notify the Trustee in writing at least
25 days prior to the date of the proposed payment of the amount of Defaulted
Interest proposed to be paid on each such Debenture and the date of the
proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix a special
record date for the payment of such Defaulted Interest which shall not be more
than 15 nor less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment.  The Trustee shall
promptly notify the Company of such special record date and, in the name and at
the expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed, first
class postage prepaid, to each Securityholder at its address as it appears in
the Debenture Register, not less than 10 days prior to such special record
date.  Notice of the proposed payment of
such Defaulted Interest and the special record date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names such Debentures (or their respective Predecessor Securities) are
registered on such special record date and shall be no longer payable.

 

The Company may make payment of any Defaulted Interest on any
Debentures in any other lawful manner after notice given by the Company to the
Trustee of the proposed payment method; provided, however, the
Trustee in its sole discretion deems such payment method to be practical.

 

Any interest (including Additional Interest) scheduled to become
payable on an Interest Payment Date occurring during an Extension Period shall
not be Defaulted Interest and shall be payable on such other date as may be
specified in the terms of such Debentures.

 

The term “regular record date” as used in this Section shall mean the
close of business on the 15th calendar day next preceding the
applicable Interest Payment Date.

 

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

 

13

 

Section 2.9.           Cancellation of Debentures Paid, etc.  All Debentures surrendered for the purpose of
payment, redemption, exchange or registration of transfer, shall, if
surrendered to the Company or any paying agent, be surrendered to the Trustee
and promptly canceled by it, or, if surrendered to the Trustee or any
Authenticating Agent, shall be promptly canceled by it, and no Debentures shall
be issued in lieu thereof except as expressly permitted by any of the
provisions of this Indenture.  All
Debentures canceled by any Authenticating Agent shall be delivered to the
Trustee.  The Trustee shall destroy all
canceled Debentures unless the Company otherwise directs the Trustee in
writing.  If the Company shall acquire
any of the Debentures, however, such acquisition shall not operate as a
redemption or satisfaction of the indebtedness represented by such Debentures
unless and until the same are surrendered to the Trustee for cancellation.

 

Section 2.10.        Computation of Interest.  The amount of interest payable for the
Distribution Period commencing on August 15, 2003 and each succeeding
Distribution Period will be calculated by applying the Interest Rate to the
principal amount outstanding at the commencement of the Distribution Period and
multiplying each such amount by the actual number of days in the Distribution
Period concerned divided by 360.  In the
event that any date on which interest is payable on the Debentures is not a
Business Day, then payment of interest payable on such date shall be made on
the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment was originally payable.  All percentages resulting from any
calculations on the Debentures will be rounded, if necessary, to the nearest
one hundred-thousandth of a percentage point, with five one-millionths of a
percentage point rounded upward (e.g., 9.876545% (or .09876545) being rounded
to 9.87655% (or .0987655), and all dollar amounts used in or resulting from
such calculation will be rounded to the nearest cent (with one-half cent being
rounded upward)).

 

(a)           “3-Month
LIBOR” means the London interbank offered interest rate for three-month,
U.S. dollar deposits determined by the Trustee in the following order of
priority:

 

(1)           the rate
(expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date (as defined below).  “Telerate Page 3750” means the display
designated as “Page 3750” on the Dow Jones Telerate Service or such other
page as may replace Page 3750 on that service or such other service or
services as may be nominated by the British Bankers’ Association as the
information vendor for the purpose of displaying London interbank offered rates
for U.S. dollar deposits;

 

(2)           if such rate
cannot be identified on the related Determination Date, the Trustee will
request the principal London offices of four leading banks in the London
interbank market to provide such banks’ offered quotations (expressed as
percentages per annum) to prime banks in the London interbank market for U.S.
dollar deposits having a three-month maturity as of 11:00 a.m. (London
time) on such Determination Date.  If at 

 

14

 

least
two quotations are provided, 3-Month LIBOR will be the arithmetic mean of such
quotations;

 

(3)           if fewer than
two such quotations are provided as requested in clause (2) above, the
Trustee will request four major New York City banks to provide such banks’
offered quotations (expressed as percentages per annum) to leading European
banks for loans in U.S. dollars as of 11:00 a.m. (London time) on such
Determination Date.  If at least two such
quotations are provided, 3-Month LIBOR will be the arithmetic mean of such
quotations; and

 

(4)           if fewer than
two such quotations are provided as requested in clause (3) above, 3-Month
LIBOR will be a 3-Month LIBOR determined with respect to the Distribution
Period immediately preceding such current Distribution Period.

 

If the rate for U.S. dollar deposits having a three-month maturity that
initially appears on Telerate Page 3750 as of 11:00 a.m. (London
time) on the related Determination Date is superseded on the Telerate
Page 3750 by a corrected rate by 12:00 noon (London time) on such
Determination Date, then the corrected rate as so substituted on the applicable
page will be the applicable 3-Month LIBOR for such Determination Date.

 

(b)           The Interest
Rate for any Distribution Period will at no time be higher than the maximum
rate then permitted by New York law as the same may be modified by United
States law.

 

(c)           “Determination
Date” means the date that is two London Banking Days (i.e., a business day
in which dealings in deposits in U.S. dollars are transacted in the London
interbank market) preceding the particular Distribution Period for which a
Coupon Rate is being determined.

 

(d)           The Trustee
shall notify the Company, the Institutional Trustee and any securities exchange
or interdealer quotation system on which the Capital Securities are listed, of
the Coupon Rate and the Determination Date for each Distribution Period, in
each case as soon as practicable after the determination thereof but in no
event later than the thirtieth (30th) day of the relevant Distribution
Period.  Failure to notify the Company,
the Institutional Trustee or any securities exchange or interdealer quotation
system, or any defect in said notice, shall not affect the obligation of the
Company to make payment on the Debentures at the applicable Coupon Rate.  Any error in the calculation of the Coupon Rate
by the Trustee may be corrected at any time by notice delivered as above
provided.  Upon the request of a holder
of a Debenture, the Trustee shall provide the Coupon Rate then in effect and,
if determined, the Coupon Rate for the next Distribution Period.

 

(e)           Subject to the
corrective rights set forth above, all certificates, communications, opinions,
determinations, calculations, quotations and decisions given, expressed, made
or obtained for the purposes of the provisions relating to the payment and
calculation of interest on the Debentures and distributions on the Capital
Securities by the Trustee or the Institutional Trustee will (in the absence of
willful default, bad faith and manifest error) be final, conclusive and binding
on the Trust, the Company and all of the holders of the Debentures and the
Capital 

 

15

 

Securities, and no liability shall (in the absence
of willful default, bad faith or manifest error) attach to the Trustee or the
Institutional Trustee in connection with the exercise or non-exercise by either
of them of their respective powers, duties and discretion.

 

Section 2.11.        Extension of Interest Payment Period.  So long as no Event of Default has occurred
and is continuing, the Company shall have the right, from time to time, and
without causing an Event of Default, to defer payments of interest on the
Debentures by extending the interest payment period on the Debentures at any
time and from time to time during the term of the Debentures, for up to
20 consecutive quarterly periods (each such extended interest payment
period, an “Extension Period”), during which Extension Period no
interest (including Additional Interest) shall be due and payable (except any
Additional Sums that may be due and payable). 
No Extension Period may end on a date other than an Interest Payment
Date.  During an Extension Period,
interest will continue to accrue on the Debentures, and interest on such
accrued interest will accrue at an annual rate equal to the Interest Rate in
effect for such Extension Period, compounded quarterly from the date such
interest would have been payable were it not for the Extension Period, to the
extent permitted by law (such interest referred to herein as “Additional
Interest”).  At the end of any such
Extension Period the Company shall pay all interest then accrued and unpaid on
the Debentures (together with Additional Interest thereon); provided, however,
that no Extension Period may extend beyond the Maturity Date; provided  further,
however, that during any such Extension Period, the Company shall not
and shall not permit any Affiliate of the Company controlled by the Company to
(i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of the Company’s or
such Affiliate’s capital stock (other than payments of dividends or
distributions to the Company or a Subsidiary of the Company) or make any
guarantee payments with respect to the foregoing; or (ii) make any payment
of principal of or interest or premium, if any, on or repay, repurchase or
redeem any debt securities of the Company or any Affiliate of the Company
controlled by the Company that rank pari
passu in all respects with or junior in interest to the Debentures
(other than, with respect to clauses (i) and (ii) above, (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company or
any Subsidiary of the Company in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of one or
more employees, officers, directors or consultants, in connection with a
dividend reinvestment or stockholder stock purchase plan or in connection with
the issuance of capital stock of the Company or of such Subsidiary (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion
of any class or series of the Company’s capital stock (or any capital stock of
a Subsidiary of the Company) for any class or series of the Company’s capital
stock (or in the case of a Subsidiary of the Company, any class or series of
such Subsidiary’s capital stock) or of any class or series of the Company’s indebtedness
for any class or series of the Company’s capital stock (or in the case of
indebtedness of a Subsidiary of the Company, of any class or series of such
Subsidiary’s indebtedness for any class or series of such Subsidiary’s capital
stock), (c) the purchase of fractional interests in shares of the
Company’s capital stock (or the capital stock of a Subsidiary of the Company)
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a dividend
in connection with any stockholders’ rights plan, or the issuance of rights,
stock or other property under any stockholders’ rights plan, or the redemption
or repurchase of rights pursuant thereto, (e) any dividend in the form of
stock, 

 

16

 

warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu
with or junior to such stock and any cash payments in lieu of fractional shares
issued in connection therewith, or (f) payments under the Capital
Securities Guarantee).  Prior to the
termination of any Extension Period, the Company may further extend such
period, provided that such period together with all such previous and further
consecutive extensions thereof shall not exceed 20 consecutive quarterly
periods, or extend beyond the Maturity Date. 
Upon the termination of any Extension Period and upon the payment of all
accrued and unpaid interest and Additional Interest, the Company may commence a
new Extension Period, subject to the foregoing requirements.  No interest or Additional Interest shall be
due and payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
an Extension Period shall bear Additional Interest to the extent permitted by
applicable law.  The Company must give
the Trustee notice of its election to begin or extend an Extension Period at
least 5 Business Days prior to the regular record date (as such term is used in
Section 2.8) immediately preceding the Interest Payment Date with respect to
which interest on the Debentures would have been payable except for the
election to begin or extend an Extension Period.  The Trustee shall give notice of the
Company’s election to begin a new Extension Period to the Securityholders.

 

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

 

ARTICLE III.

PARTICULAR COVENANTS OF THE COMPANY

 

Section 3.1.           Payment of Principal, Premium and Interest; Agreed Treatment of the
Debentures.

 

(a)           The Company
covenants and agrees that it will duly and punctually pay or cause to be paid
the principal of and premium, if any, and interest and any Additional Interest
and other payments on the Debentures at the place, at the respective times and
in the manner provided in this Indenture and the Debentures. Each installment
of interest on the Debentures may be paid (i) by mailing checks for such
interest payable to the order of the holders of Debentures entitled thereto as
they appear on the registry books of the Company if a request for a wire
transfer has not been received by the Company or (ii) by wire transfer to
any account with a banking institution located in the United States designated
in writing by such Person to the paying agent no later than the related record
date.  Notwithstanding the foregoing, so
long as the holder of this Debenture is the Institutional Trustee, the payment
of the principal of and interest on this Debenture will be made in immediately
available funds at such place and to such account as may be designated by the
Institutional Trustee.

 

17

 

(b)           The Company
will treat the Debentures as indebtedness of the Company that is in registered
form within the meaning of Treasury Regulations Section 1.871-14(c)(1)(i).  The Company will further treat the amounts
payable in respect of the principal amount of such Debentures as interest for
all United States federal income and withholding tax purposes.  All interest payments in respect of such
Debentures will be made free and clear of United States withholding tax to any
beneficial owner thereof that has provided an Internal Revenue Service Form W-8
BEN (or any substitute or successor form) establishing its non-United States
status for United States federal income and withholding tax purposes.

 

(c)           As of the date
of this Indenture, the Company has no present intention to exercise its right
under Section 2.11 to defer payments of interest on the Debentures by commencing
an Extension Period.

 

(d)           As of the date
of this Indenture, the Company believes that the likelihood that it would
exercise its right under Section 2.11 to defer payments of interest on the
Debentures by commencing an Extension Period at any time during which the
Debentures are outstanding is remote because of the restrictions that would be
imposed on the Company’s ability to declare or pay dividends or distributions
on, or to redeem, purchase or make a liquidation payment with respect to, any
of its outstanding equity and on the Company’s ability to make any payments of
principal of or interest on, or repurchase or redeem, any of its debt
securities that rank pari passu
in all respects with (or junior in interest to) the Debentures.

 

Section 3.2.           Offices for Notices and Payments, etc.  So long as any of the
Debentures remain outstanding, the Company will maintain in Hartford,
Connecticut, an office or agency where the Debentures may be presented for
payment, an office or agency where the Debentures may be presented for
registration of transfer and for exchange as in this Indenture provided and an
office or agency where notices and demands to or upon the Company in respect of
the Debentures or of this Indenture may be served.  The Company will give to the Trustee written
notice of the location of any such office or agency and of any change of
location thereof.  Until otherwise
designated from time to time by the Company in a notice to the Trustee, or
specified as contemplated by Section 2.5, such office or agency for all of the
above purposes shall be the office or agency of the Trustee.  In case the Company shall fail to maintain
any such office or agency in Hartford, Connecticut, or shall fail to give such
notice of the location or of any change in the location thereof, presentations
and demands may be made and notices may be served at the Principal Office of
the Trustee.

 

In addition to any such office or agency, the Company may from time to
time designate one or more offices or agencies outside Hartford, Connecticut,
where the Debentures may be presented for registration of transfer and for
exchange in the manner provided in this Indenture, and the Company may from
time to time rescind such designation, as the Company may deem desirable or
expedient; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain any such office or agency in Hartford, Connecticut, for the purposes
above mentioned.  The Company will give
to the Trustee prompt written notice of any such designation or rescission
thereof.

 

18

 

Section 3.3.           Appointments to Fill Vacancies in Trustee’s Office.  The Company, whenever necessary to avoid or
fill a vacancy in the office of Trustee, will appoint, in the manner provided
in Section 6.9, a Trustee, so that there shall at all times be a Trustee
hereunder.

 

Section 3.4.           Provision as to Paying Agent.

 

(a)           If the Company
shall appoint a paying agent other than the Trustee, it will cause such paying
agent to execute and deliver to the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provision of this
Section 3.4,

 

(1)            that it will hold all
sums held by it as such agent for the payment of the principal of and premium,
if any, or interest, if any, on the Debentures (whether such sums have been
paid to it by the Company or by any other obligor on the Debentures) in trust
for the benefit of the holders of the Debentures;

 

(2)            that it will give the Trustee
prompt written notice of any failure by the Company (or by any other obligor on
the Debentures) to make any payment of the principal of and premium, if any, or
interest, if any, on the Debentures when the same shall be due and payable; and

 

(3)            that it will, at any
time during the continuance of any Event of Default, upon the written request
of the Trustee, forthwith pay to the Trustee all sums so held in trust by such
paying agent.

 

(b)           If the Company
shall act as its own paying agent, it will, on or before each due date of the
principal of and premium, if any, or interest or other payments, if any, on the
Debentures, set aside, segregate and hold in trust for the benefit of the
holders of the Debentures a sum sufficient to pay such principal, premium,
interest or other payments so becoming due and will notify the Trustee in
writing of any failure to take such action and of any failure by the Company
(or by any other obligor under the Debentures) to make any payment of the
principal of and premium, if any, or interest or other payments, if any, on the
Debentures when the same shall become due and payable.

 

Whenever the Company shall have one or more paying agents for the
Debentures, it will, on or prior to each due date of the principal of and
premium, if any, or interest, if any, on the Debentures, deposit with a paying
agent a sum sufficient to pay the principal, premium, interest or other
payments so becoming due, such sum to be held in trust for the benefit of the
Persons entitled thereto and (unless such paying agent is the Trustee) the
Company shall promptly notify the Trustee in writing of its action or failure
to act.

 

(c)           Anything in
this Section 3.4 to the contrary notwithstanding, the Company may, at any
time, for the purpose of obtaining a satisfaction and discharge with respect to
the Debentures, or for any other reason, pay, or direct any paying agent to pay
to the Trustee all sums held in trust by the Company or any such paying agent,
such sums to be held by the Trustee upon the trusts herein contained.

 

(d)           Anything in
this Section 3.4 to the contrary notwithstanding, the agreement to hold
sums in trust as provided in this Section 3.4 is subject to
Sections 12.3 and 12.4.

 

19

 

Section 3.5.           Certificate to Trustee.  The Company will deliver to the Trustee on or
before 120 days after the end of each fiscal year, so long as Debentures
are outstanding hereunder, a Certificate stating that in the course of the
performance by the signers of their duties as officers of the Company they
would normally have knowledge of any default during such fiscal year by the
Company in the performance of any covenants contained herein, stating whether
or not they have knowledge of any such default and, if so, specifying each such
default of which the signers have knowledge and the nature and status thereof.

 

Section 3.6.           Additional Sums.  If
and for so long as the Trust is the holder of all Debentures and the Trust is
required to pay any additional taxes (excluding withholding taxes), duties,
assessments or other governmental charges as a result of any amendment to or
change in law or regulations thereunder, an Administrative Action (as referred
to in the definition of Tax Event in Section 1.1) or a judicial decision, in
each case enacted, promulgated or announced on or after the date of original
issuance of the Debentures, then the Company will pay such additional amounts
(“Additional Sums”) on the Debentures as shall be required so that the
net amounts received and retained by the Trust after paying such taxes
(excluding withholding taxes), duties, assessments or other governmental
charges will be equal to the amounts the Trust would have received if no such
taxes (excluding withholding taxes), duties, assessments or other governmental
charges had been imposed.  Whenever in
this Indenture or the Debentures there is a reference in any context to the
payment of principal of or interest on the Debentures, such mention shall be
deemed to include mention of payments of the Additional Sums provided for in
this paragraph to the extent that, in such context, Additional Sums are, were
or would be payable in respect thereof pursuant to the provisions of this
paragraph and express mention of the payment of Additional Sums (if applicable)
in any provisions hereof shall not be construed as excluding Additional Sums in
those provisions hereof where such express mention is not made; provided,
however, that the deferral of the payment of interest during an
Extension Period pursuant to Section 2.11 shall not defer the payment of
any Additional Sums that may be due and payable.

 

Section 3.7.           Compliance with Consolidation Provisions.  The Company will not, while any of the
Debentures remain outstanding, consolidate with, or merge into, or merge into
itself, or sell or convey all or substantially all of its property to any other
Person unless the provisions of Article XI hereof are complied with.

 

Section 3.8.           Limitation on Dividends.  If Debentures are initially issued to the
Trust or a trustee of such Trust in connection with the issuance of Trust
Securities by the Trust (regardless of whether Debentures continue to be held
by such Trust) and (i) there shall have occurred and be continuing an
Event of Default, (ii) the Company shall be in default with respect to its
payment of any obligations under the Capital Securities Guarantee, or
(iii) the Company shall have given notice of its election to defer
payments of interest on the Debentures by extending the interest payment period
as provided herein and such period, or any extension thereof, shall be
continuing, then the Company shall not, and shall not permit any Affiliate of
the Company controlled by the Company 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 Company’s or such Affiliates’ capital stock
(other than payments of dividends or distributions to the Company or a
Subsidiary of the Company) or make any guarantee payments with respect to the foregoing
or (y) make any payment of principal of or interest or premium, if any, on
or repay, 

 

20

 

repurchase or redeem any
debt securities of the Company or any Affiliate of the Company controlled by
the Company that rank pari passu
in all respects with or junior in interest to the Debentures (other than, with
respect to clauses (x) and (y) above, (1) repurchases, redemptions or
other acquisitions of shares of capital stock of the Company or any Subsidiary of
the Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Company or of such Subsidiary (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (2) as
a result of any exchange or conversion of any class or series of the Company’s
capital stock (or any capital stock of a Subsidiary of the Company) for any
class or series of the Company’s capital stock (or in the case of a Subsidiary of
the Company, any class or series of such Subsidiary’s capital stock) or of any
class or series of the Company’s indebtedness for any class or series of the
Company’s capital stock (or in the case of indebtedness of a Subsidiary of the
Company, of any class or series of such Subsidiary’s indebtedness for any class
or series of such Subsidiary’s capital stock), (3) the purchase of
fractional interests in shares of the Company’s capital stock (or the capital
stock of Subsidiary of the Company) pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(4) any declaration of a dividend in connection with any stockholders’
rights plan, or the issuance of rights, stock or other property under any
stockholders’ rights plan, or the redemption or repurchase of rights pursuant
thereto, (5) any dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu
with or junior to such stock and any cash payments in lieu of fractional shares
issued in connection therewith, or (6) payments under the Capital
Securities Guarantee).

 

Section 3.9.           Covenants as to the Trust.  For so long as the Trust Securities remain
outstanding, the Company shall maintain 100% ownership of the Common
Securities; provided, however, that any permitted successor of
the Company under this Indenture may succeed to the Company’s ownership of such
Common Securities.  The Company, as owner
of the Common Securities, shall, except in connection with a distribution of
Debentures to the holders of Trust Securities in liquidation of the Trust, the
redemption of all of the Trust Securities or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration, cause the Trust (a) to
remain a statutory trust, (b) to otherwise continue to be classified as a
grantor trust for United States federal income tax purposes, and (c) to
cause each holder of Trust Securities to be treated as owning an undivided
beneficial interest in the Debentures.

 

Section 3.10.        Additional Junior Indebtedness.  The Company shall not, and
it shall not cause or permit any Subsidiary of the Company to, incur, issue or
be obligated on any Additional Junior Indebtedness, either directly or
indirectly, by way of guarantee, suretyship or otherwise, other than Additional
Junior Indebtedness that, by its terms, is expressly stated to be either junior
and subordinate or pari passu in
all respects to the Debentures.

 

Section 3.11.        Consent to Jurisdiction and Venue.  The Company has validly and
irrevocably submitted to the nonexclusive jurisdiction of any New York Court
(as defined in Section 14.13 of this Indenture) 
with respect to suits, actions or proceedings arising out of or in 

 

21

 

connection with violations
of United States federal securities laws relating to offers and sales of the
Capital Securities, has validly and irrevocably waived, to the fullest extent
permitted by law, any objections that it may now or hereafter have to the
laying of venue of any such suit, action or proceeding brought in any New York
Court based on or arising under this Agreement or any claims that any such
suit, action or proceeding brought in any New York Court has been brought in an
inconvenient forum, and has duly and irrevocably appointed Corporation Service
Company in Albany, New York as its agent to receive service of process with
respect to actions arising out of or in connection with any such suit, action
or proceeding; and service of process effected in the manner set forth in
Section 14.13 of this Indenture will be effective under the laws of Bermuda to
confer personal jurisdiction over the Company.

 

ARTICLE IV.

SECURITYHOLDERS LISTS AND REPORTS

BY THE COMPANY AND THE TRUSTEE

 

Section 4.1.           Securityholders Lists.  The Company covenants and agrees that it will
furnish or cause to be furnished to the Trustee:

 

(a)           on each regular
record date for the Debentures, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Securityholders of the
Debentures as of such record date; and

 

(b)           at such other
times as the Trustee may request in writing, within 30 days after the
receipt by the Company of any such request, a list of similar form and content
as of a date not more than 15 days prior to the time such list is
furnished;

 

except that no such lists need be furnished under this Section 4.1
so long as the Trustee is in possession thereof by reason of its acting as
Debenture registrar.

 

Section 4.2.           Preservation and Disclosure of Lists.

 

(a)           The Trustee
shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the holders of Debentures
(1) contained in the most recent list furnished to it as provided in
Section 4.1 or (2) received by it in the capacity of Debentures
registrar (if so acting) hereunder.  The
Trustee may destroy any list furnished to it as provided in Section 4.1
upon receipt of a new list so furnished.

 

(b)           In case three
or more holders of Debentures (hereinafter referred to as “applicants”) apply
in writing to the Trustee and furnish to the Trustee reasonable proof that each
such applicant has owned a Debenture for a period of at least 6 months
preceding the date of such application, and such application states that the
applicants desire to communicate with other holders of Debentures with respect
to their rights under this Indenture or under such Debentures and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall within 5 Business Days
after the receipt of such application, at its election, either:

 

22

 

(1)            afford such applicants
access to the information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 4.2, or

 

(2)            inform such applicants
as to the approximate number of holders of Debentures whose names and addresses
appear in the information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 4.2, and as to
the approximate cost of mailing to such Securityholders the form of proxy or
other communication, if any, specified in such application.

 

If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each Securityholder whose name and address appear in the information
preserved at the time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.2 a copy of the form of proxy or
other communication which is specified in such request with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, the Trustee shall mail to such
applicants and file with the Securities and Exchange Commission, if permitted
or required by applicable law, together with a copy of the material to be
mailed, a written statement to the effect that, in the opinion of the Trustee,
such mailing would be contrary to the best interests of the holders of all
Debentures, as the case may be, or would be in violation of applicable
law.  Such written statement shall
specify the basis of such opinion.  If
said Commission, as permitted or required by applicable law, after opportunity
for a hearing upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections or if, after
the entry of an order sustaining one or more of such objections, said
Commission shall find, after notice and opportunity for hearing, that all the
objections so sustained have been met and shall enter an order so declaring,
the Trustee shall mail copies of such material to all such Securityholders with
reasonable promptness after the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of any obligation or duty to
such applicants respecting their application.

 

(c)           Each and every
holder of Debentures, by receiving and holding the same, agrees with Company
and the Trustee that neither the Company nor the Trustee nor any paying agent
shall be held accountable by reason of the disclosure of any such information
as to the names and addresses of the holders of Debentures in accordance with the
provisions of subsection (b) of this Section 4.2, regardless of the
source from which such information was derived, and that the Trustee shall not
be held accountable by reason of mailing any material pursuant to a request
made under said subsection (b).

 

ARTICLE V.

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS

UPON AN EVENT OF DEFAULT

 

Section 5.1.           Events of Default.  “Event of Default,” wherever
used herein, means any one of the following events (whatever the reason for
such Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, 

 

23

 

decree or order of any court
or any order, rule or regulation of any administrative or governmental body):

 

(a)           the Company
defaults in the payment of any interest upon any Debenture when it becomes due
and payable, and fails to cure such default for a period of 30 days; provided,
however, that a valid extension of an interest payment period by the
Company in accordance with the terms of this Indenture shall not constitute a
default in the payment of interest for this purpose; or

 

(b)           the Company
defaults in the payment of all or any part of the principal of (or premium, if
any, on) any Debentures as and when the same shall become due and payable
either at maturity, upon redemption, by declaration of acceleration or
otherwise; or

 

(c)           the Company
defaults in the performance of, or breaches, any of its covenants or agreements
in this Indenture or in the terms of the Debentures established as contemplated
in this Indenture (other than a covenant or agreement a default in whose
performance or whose breach is elsewhere in this Section specifically dealt
with), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the outstanding Debentures, a written notice specifying
such default or breach and requiring it to be remedied and stating that such
notice is a “Notice of Default” hereunder; or

 

(d)           a court of
competent jurisdiction shall enter a decree or order for relief in respect of
the Company in an involuntary case under any applicable bankruptcy, insolvency,
reorganization or other similar law now or hereafter in effect, or shall
appoint a receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of the Company or for any substantial part of its property,
or shall order the winding-up or liquidation of its affairs and such decree or
order shall remain unstayed and in effect for a period of 90 consecutive
days; or

 

(e)           the Company
shall commence a voluntary case under any applicable bankruptcy, insolvency,
reorganization or other similar law now or hereafter in effect, shall consent
to the entry of an order for relief in an involuntary case under any such law,
or shall consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or other similar
official) of the Company or of any substantial part of its property, or shall
make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due; or

 

(f)            the Trust shall
have voluntarily or involuntarily liquidated, dissolved, wound-up its business
or otherwise terminated its existence except in connection with (i) the
distribution of the Debentures to holders of such Trust Securities in liquidation
of their interests in the Trust, (ii) the redemption of all of the
outstanding Trust Securities or (iii) certain mergers, consolidations or
amalgamations, each as permitted by the Declaration.

 

If an Event of Default occurs and is continuing with respect to the
Debentures, then, and in each and every such case, unless the principal of the
Debentures shall have already become due and payable, either the Trustee or the
holders of not less than 25% in aggregate principal 

 

24

 

amount of the Debentures then
outstanding hereunder, by notice in writing to the Company (and to the Trustee
if given by Securityholders), may declare the entire principal of the
Debentures and the interest accrued thereon, if any, to be due and payable
immediately, and upon any such declaration the same shall become immediately
due and payable.

 

The foregoing provisions, however, are subject to the condition that
if, at any time after the principal of the Debentures shall have been so
declared due and payable, and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided, (i)
the Company shall pay or shall deposit with the Trustee a sum sufficient to pay
all matured installments of interest upon all the Debentures and the principal
of and premium, if any, on the Debentures which shall have become due otherwise
than by acceleration (with interest upon such principal and premium, if any,
and Additional Interest) and such amount as shall be sufficient to cover
reasonable compensation to the Trustee and each predecessor Trustee, their
respective agents, attorneys and counsel, and all other amounts due to the
Trustee pursuant to Section 6.6, if any, and (ii) all Events of Default
under this Indenture, other than the non-payment of the principal of or
premium, if any, on Debentures which shall have become due by acceleration,
shall have been cured, waived or otherwise remedied as provided herein --
then and in every such case the holders of a majority in aggregate principal
amount of the Debentures then outstanding, by written notice to the Company and
to the Trustee, may waive all defaults and rescind and annul such declaration
and its consequences, but no such waiver or rescission and annulment shall
extend to or shall affect any subsequent default or shall impair any right
consequent thereon.

 

In case the Trustee shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned
because of such rescission or annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the Trustee and the holders of the Debentures shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the Company, the Trustee and the holders of the
Debentures shall continue as though no such proceeding had been taken.

 

Section 5.2.           Payment of Debentures on Default; Suit Therefor.  The Company covenants that upon the
occurrence of an Event of Default pursuant to Section 5.1(a) or Section 5.1(b)
then, upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the holders of the Debentures the whole amount that then shall have
become due and payable on all Debentures for principal and premium, if any, or
interest, or both, as the case may be, with Additional Interest accrued on the
Debentures (to the extent that payment of such interest is enforceable under
applicable law and, if the Debentures are held by the Trust or a trustee of
such Trust, without duplication of any other amounts paid by the Trust or a
trustee in respect thereof); and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and counsel, and
any other amounts due to the Trustee under Section 6.6.  In case the Company shall fail forthwith to
pay such amounts upon such demand, the Trustee, in its own name and as trustee
of an express trust, shall be entitled and empowered to institute any actions
or proceedings at law or in equity for the collection of the sums so due and
unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company
or any other obligor on such Debentures and 

 

25

 

collect in the manner
provided by law out of the property of the Company or any other obligor on such
Debentures wherever situated the moneys adjudged or decreed to be payable.

 

In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Debentures under
Bankruptcy Law, or in case a receiver or trustee shall have been appointed for
the property of the Company or such other obligor, or in the case of any other
similar judicial proceedings relative to the Company or other obligor upon the
Debentures, or to the creditors or property of the Company or such other
obligor, the Trustee, irrespective of whether the principal of the Debentures
shall then be due and payable as therein expressed or by declaration of
acceleration or otherwise and irrespective of whether the Trustee shall have
made any demand pursuant to the provisions of this Section 5.2, shall be
entitled and empowered, by intervention in such proceedings or otherwise,

 

(a)           to file and
prove a claim or claims for the whole amount of principal and interest owing
and unpaid in respect of the Debentures,

 

(b)           in case of any
judicial proceedings, to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for reasonable compensation to the Trustee and
each predecessor Trustee, and their respective agents, attorneys and counsel,
and for reimbursement of all other amounts due to the Trustee under
Section 6.6), and of the Securityholders allowed in such judicial
proceedings relative to the Company or any other obligor on the Debentures, or
to the creditors or property of the Company or such other obligor, unless
prohibited by applicable law and regulations, to vote on behalf of the holders
of the Debentures in any election of a trustee or a standby trustee in
arrangement, reorganization, liquidation or other bankruptcy or insolvency
proceedings or Person performing similar functions in comparable proceedings,

 

(c)           to collect and
receive any moneys or other property payable or deliverable on any such claims,
and

 

(d)           to distribute
the same after the deduction of its charges and expenses.

 

Any receiver, assignee or trustee in bankruptcy or reorganization is
hereby authorized by each of the Securityholders to make such payments to the
Trustee, and, in the event that the Trustee shall consent to the making of such
payments directly to the Securityholders, to pay to the Trustee such amounts as
shall be sufficient to cover reasonable compensation to the Trustee, each
predecessor Trustee and their respective agents, attorneys and counsel, and all
other amounts due to the Trustee under Section 6.6.

 

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

 

All rights of action and of asserting claims under this Indenture, or
under any of the Debentures, may be enforced by the Trustee without the
possession of any of the Debentures, or the production thereof at any trial or
other proceeding relative thereto, and any such suit or 

 

26

 

proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgment shall be for the ratable benefit of the holders of the
Debentures.

 

In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party), the Trustee shall be held to represent all the holders
of the Debentures, and it shall not be necessary to make any holders of the
Debentures parties to any such proceedings.

 

Section 5.3.           Application of Moneys Collected by Trustee.  Any moneys collected by the Trustee pursuant
to this Article V shall be applied in the following order, at the date or
dates fixed by the Trustee for the distribution of such moneys, upon
presentation of the several Debentures in respect of which moneys have been
collected, and stamping thereon the payment, if only partially paid, and upon
surrender thereof if fully paid:

 

First:  To the payment of costs
and expenses incurred by, and reasonable fees of, the Trustee, its agents,
attorneys and counsel, and of all other amounts due to the Trustee under
Section 6.6;

 

Second:  To the payment of all
Senior Indebtedness of the Company if and to the extent required by
Article XV;

 

Third:  To the payment of the
amounts then due and unpaid upon Debentures for principal (and premium, if
any), and interest on the Debentures, in respect of which or for the benefit of
which money has been collected, ratably, without preference or priority of any
kind, according to the amounts due on such Debentures for principal (and
premium, if any) and interest (including Additional Interest), respectively;
and

 

Fourth:  The balance, if any, to
the Company.

 

Section 5.4.           Proceedings by Securityholders.  No holder of any Debenture shall have any
right to institute any suit, action or proceeding for any remedy hereunder,
unless such holder previously shall have given to the Trustee written notice of
an Event of Default with respect to the Debentures and unless the holders of
not less than 25% in aggregate principal amount of the Debentures then
outstanding shall have given the Trustee a written request to institute such
action, suit or proceeding and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred thereby, and the Trustee for 60 days after its
receipt of such notice, request and offer of indemnity shall have failed to
institute any such action, suit or proceeding.

 

Notwithstanding any other provisions in this Indenture, however, the
right of any holder of any Debenture to receive payment of the principal of,
premium, if any, and interest, on such Debenture when due, or to institute suit
for the enforcement of any such payment, shall not be impaired or affected
without the consent of such holder and by accepting a Debenture hereunder it is
expressly understood, intended and covenanted by the taker and holder of every
Debenture with every other such taker and holder and the Trustee, that no one
or more holders of Debentures shall have any right in any manner whatsoever by
virtue or by availing itself of any provision of this Indenture to affect,
disturb or prejudice the rights of the holders of any other 

 

27

 

Debentures, or to obtain or
seek to obtain priority over or preference to any other such holder, or to
enforce any right under this Indenture, except in the manner herein provided
and for the equal, ratable and common benefit of all holders of
Debentures.  For the protection and
enforcement of the provisions of this Section, each and every Securityholder
and the Trustee shall be entitled to such relief as can be given either at law
or in equity.

 

Section 5.5.           Proceedings by Trustee.  In case of an Event of Default hereunder the
Trustee may in its discretion proceed to protect and enforce the rights vested
in it by this Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such rights, either by
suit in equity or by action at law or by proceeding in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in
this Indenture or in aid of the exercise of any power granted in this
Indenture, or to enforce any other legal or equitable right vested in the
Trustee by this Indenture or by law.

 

Section 5.6.           Remedies Cumulative and Continuing; Delay or Omission Not a Waiver.  Except as otherwise provided in
Section 2.6 with respect to the replacement of mutilated, destroyed, lost
or stolen Debentures, all powers and remedies given by this Article V to
the Trustee or to the Securityholders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any other powers and remedies available
to the Trustee or the holders of the Debentures, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and
agreements contained in this Indenture or otherwise established with respect to
the Debentures, and no delay or omission of the Trustee or of any holder of any
of the Debentures to exercise any right, remedy or power accruing upon any
Event of Default occurring and continuing as aforesaid shall impair any such
right, remedy or power, or shall be construed to be a waiver of any such
default or an acquiescence therein; and, subject to the provisions of
Section 5.4, every power and remedy given by this Article V or by law
to the Trustee or to the Securityholders may be exercised from time to time,
and as often as shall be deemed expedient, by the Trustee (in accordance with
its duties under Section 6.1) or by the Securityholders.

 

No delay or omission of the Trustee or any Securityholder to exercise
any right or remedy accruing upon any Event of Default shall impair any such
right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein.  Every right and
remedy given by this Article or by law to the Trustee or to any Securityholder
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee (in accordance with its duties under Section 6.1 hereof) or by such
holder, as the case may be.

 

Section 5.7.           Direction of
Proceedings and Waiver of Defaults by Majority of Securityholders.  The holders of a majority in aggregate
principal amount of the Debentures affected (voting as one class) at the time
outstanding shall have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with respect to such
Debentures; provided, however, that (subject to the provisions of
Section 6.1) the Trustee shall have the right to decline to follow any
such direction if the Trustee shall determine that the action so directed would
be unjustly prejudicial to the holders not taking part in such direction or if
the Trustee being advised by counsel determines that the action or proceeding
so directed may not lawfully 

 

28

 

be taken or if a Responsible
Officer of the Trustee shall determine that the action or proceedings so
directed would involve the Trustee in personal liability.

 

The holders of a majority in aggregate principal amount of the
Debentures at the time outstanding may on behalf of the holders of all of the
Debentures waive (or modify any previously granted waiver of) any past default
or Event of Default, and its consequences, except a default (a) in the
payment of principal of, premium, if any, or interest on any of the Debentures,
(b) in respect of covenants or provisions hereof which cannot be modified
or amended without the consent of the holder of each Debenture affected, or
(c) in respect of the covenants contained in Section 3.9; provided,
however, that if the Debentures are held by the Trust or a trustee of
such trust, such waiver or modification to such waiver shall not be effective
until the holders of a majority in Liquidation Amount of Trust Securities of
the Trust shall have consented to such waiver or modification to such waiver, provided,
further, that if the consent of the holder of each outstanding Debenture
is required, such waiver shall not be effective until each holder of the Trust
Securities of the Trust shall have consented to such waiver.  Upon any such waiver, the default covered
thereby shall be deemed to be cured for all purposes of this Indenture and the
Company, the Trustee and the holders of the Debentures shall be restored to
their former positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other default or Event of Default or impair
any right consequent thereon.  Whenever
any default or Event of Default hereunder shall have been waived as permitted
by this Section, said default or Event of Default shall for all purposes of the
Debentures and this Indenture be deemed to have been cured and to be not
continuing.

 

Section 5.8.           Notice of Defaults.  The Trustee shall, within 90 days after
the actual knowledge by a Responsible Officer of the Trustee of the occurrence
of a default with respect to the Debentures, mail to all Securityholders, as
the names and addresses of such holders appear upon the Debenture Register,
notice of all defaults with respect to the Debentures known to the Trustee,
unless such defaults shall have been cured before the giving of such notice
(the term “defaults” for the purpose of this Section 5.8 being hereby
defined to be the events specified in clauses (a), (b), (c), (d), (e) and
(f) of Section 5.1, not including periods of grace, if any, provided for
therein); provided, however, that, except in the case of default
in the payment of the principal of, premium, if any, or interest on any of the
Debentures, the Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Securityholders.

 

Section 5.9.           Undertaking to Pay Costs.  All parties to this Indenture agree, and each
holder of any Debenture by his acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the enforcement
of any right or remedy under this Indenture, or in any suit against the Trustee
for any action taken or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys’ fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; provided, however, that the provisions of this
Section 5.9 shall not apply to any suit instituted by the Trustee, to any
suit instituted by any Securityholder, or group of Securityholders, holding in
the aggregate more than 10% in principal amount of the Debentures outstanding,
or to any suit instituted by any Securityholder for the 

 

29

 

enforcement of the payment
of the principal of (or premium, if any) or interest on any Debenture against
the Company on or after the same shall have become due and payable.

 

ARTICLE VI.

CONCERNING THE TRUSTEE

 

Section 6.1.           Duties and Responsibilities of Trustee.  With respect to the holders of Debentures
issued hereunder, the Trustee, prior to the occurrence of an Event of Default
with respect to the Debentures and after the curing or waiving of all Events of
Default which may have occurred, with respect to the Debentures, undertakes to
perform such duties and only such duties as are specifically set forth in this
Indenture, and no implied covenants shall be read into this Indenture against
the Trustee.  In case an Event of Default
with respect to the Debentures has occurred (which has not been cured or
waived), the Trustee shall exercise such of the rights and powers vested in it
by this Indenture, and use the same degree of care and skill in their exercise,
as a prudent man would exercise or use under the circumstances in the conduct
of his own affairs.

 

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

 

(a)           prior to the
occurrence of an Event of Default with respect to Debentures and after the
curing or waiving of all Events of Default which may have occurred

 

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

 

(2)            in the absence of bad
faith on the part of the Trustee, the 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 Trustee and conforming to
the requirements of this Indenture; but, in the case of any such certificates
or opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this Indenture;

 

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

 

(c)           the Trustee
shall not be liable with respect to any action taken or omitted to be taken by
it in good faith, in accordance with the direction of the Securityholders
pursuant to Section 5.7, relating to the time, method and place of
conducting any proceeding for any remedy 

 

30

 

available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture.

 

None of the provisions contained in this Indenture shall require the
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 there is ground for believing that the repayment of
such funds or liability is not assured to it under the terms of this Indenture
or indemnity satisfactory to the Trustee against such risk is not reasonably
assured to it.

 

Section 6.2.           Reliance on Documents, Opinions, etc.  Except as otherwise provided in
Section 6.1:

 

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

 

(b)           any request,
direction, order or demand of the Company mentioned herein shall be
sufficiently evidenced by an Officers’ Certificate (unless other evidence in
respect thereof be herein specifically prescribed); and any Board Resolution
may be evidenced to the Trustee by a copy thereof certified by the Secretary or
an Assistant Secretary of the Company;

 

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

 

(d)           the Trustee
shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request, order or direction of any of the
Securityholders, pursuant to the provisions of this Indenture, unless such
Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby;

 

(e)           the Trustee
shall not be liable for any action taken or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers conferred
upon it by this Indenture; nothing contained herein shall, however, relieve the
Trustee of the obligation, upon the occurrence of an Event of Default with
respect to the Debentures (that has not been cured or waived) to exercise with
respect to Debentures such of the rights and powers vested in it by this
Indenture, and to use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs;

 

(f)            the Trustee
shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond, debenture, coupon or other paper or
document, unless requested in writing to do so by the holders of not less than
a majority in aggregate principal amount of the outstanding Debentures affected
thereby; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the 

 

31

 

Trustee by the security afforded to it by the terms
of this Indenture, the Trustee may require reasonable indemnity against such
expense or liability as a condition to so proceeding;

 

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

 

(h)           with the
exceptions of defaults under Sections 5.1(a) or 5.1(b), the Trustee shall not
be charged with knowledge of any Default or Event of Default with respect to
the Debentures unless a written notice of such Default or Event of Default
shall have been given to the Trustee by the Company or any other obligor on the
Debentures or by any holder of the Debentures.

 

Section 6.3.           No Responsibility for Recitals, etc.  The recitals contained herein and in the
Debentures (except in the certificate of authentication of the Trustee or the
Authenticating Agent) shall be taken as the statements of the Company, and the
Trustee and the Authenticating Agent assume no responsibility for the
correctness of the same.  The Trustee and
the Authenticating Agent make no representations as to the validity or
sufficiency of this Indenture or of the Debentures.  The Trustee and the Authenticating Agent
shall not be accountable for the use or application by the Company of any
Debentures or the proceeds of any Debentures authenticated and delivered by the
Trustee or the Authenticating Agent in conformity with the provisions of this
Indenture.

 

Section 6.4.           Trustee, Authenticating Agent, Paying Agents, Transfer Agents or
Registrar May Own Debentures.  The Trustee or any Authenticating Agent or
any paying agent or any transfer agent or any Debenture registrar, in its
individual or any other capacity, may become the owner or pledgee of Debentures
with the same rights it would have if it were not Trustee, Authenticating Agent,
paying agent, transfer agent or Debenture registrar.

 

Section 6.5.           Moneys to be Held in Trust.  Subject to the provisions of
Section 12.4, all moneys received by the Trustee or any paying agent
shall, until used or applied as herein provided, be held in trust for the
purpose for which they were received, but need not be segregated from other
funds except to the extent required by law. 
The Trustee and any paying agent shall be under no liability for
interest on any money received by it hereunder except as otherwise agreed in
writing with the Company.  So long as no
Event of Default shall have occurred and be continuing, all interest allowed on
any such moneys shall be paid from time to time upon the written order of the
Company, signed by the Chief Executive Officer, the President, a Vice
President, the Treasurer or an Assistant Treasurer of the Company.

 

Section 6.6.           Compensation and Expenses of Trustee.  The Company covenants and agrees to pay to
the Trustee from time to time, and the Trustee shall be entitled to, such
compensation as shall be agreed to in writing between the Company and the
Trustee (which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), and the Company will pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its counsel and of all Persons not
regularly in its employ) except any such 

 

32

 

expense, disbursement or
advance as may arise from its negligence or willful misconduct.  The Company also covenants to indemnify the
Trustee and any predecessor Trustee (and its officers, agents, directors and
employees) for, and to hold it harmless against, any and all loss, damage,
claim, liability or expense including taxes (other than taxes based on the
income of the Trustee) incurred without negligence or willful misconduct on the
part of the Trustee and arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of defending
itself against any claim of liability.  The
obligations of the Company under this Section 6.6 to compensate and
indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder.  Such additional indebtedness shall be secured
by a lien prior to that of the Debentures upon all property and funds held or
collected by the Trustee as such, except funds held in trust for the benefit of
the holders of particular Debentures.

 

Without prejudice to any other rights available to the Trustee under
applicable law, when the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.1(d),
Section 5.1(e) or Section 5.1(f), the expenses (including the
reasonable charges and expenses of its counsel) and the compensation for the
services are intended to constitute expenses of administration under any
applicable federal or state bankruptcy, insolvency or other similar law.

 

The provisions of this Section shall survive the resignation or removal
of the Trustee and the defeasance or other termination of this Indenture.

 

Notwithstanding anything in this Indenture or any Debenture to the
contrary, the Trustee shall have no obligation whatsoever to advance funds to
pay any principal of or interest on or other amounts with respect to the
Debentures or otherwise advance funds to or on behalf of the Company.

 

Section 6.7.           Officers’ Certificate as Evidence.  Except as otherwise provided in
Sections 6.1 and 6.2, whenever in the administration of the provisions of
this Indenture the Trustee shall deem it necessary or desirable that a matter
be proved or established prior to taking or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or willful misconduct on the part
of the Trustee, be deemed to be conclusively proved and established by an
Officers’ Certificate delivered to the Trustee, and such certificate, in the
absence of negligence or willful misconduct on the part of the Trustee, shall
be full warrant to the Trustee for any action taken or omitted by it under the
provisions of this Indenture upon the faith thereof.

 

Section 6.8.           Eligibility of Trustee.  The Trustee hereunder shall at all times 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 authorized under such laws to exercise corporate
trust powers, having (or whose obligations under this Indenture are guaranteed
by an affiliate having) a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000.00) 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 aforesaid supervising or examining authority, then for the purposes of
this Section 6.8 the combined capital and surplus of such corporation
shall be deemed to be its combined capital and 

 

33

 

surplus as set forth in its
most recent records of condition so published.

 

The Company may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Company, serve as
Trustee.

 

In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.8, the Trustee shall
resign immediately in the manner and with the effect specified in
Section 6.9.

 

If the Trustee has or shall acquire any “conflicting interest” within
the meaning of §310(b) of the Trust Indenture Act of 1939, the Trustee shall
either eliminate such interest or resign, to the extent and in the manner
described by this Indenture.

 

Section 6.9.           Resignation or Removal of Trustee.

 

(a)           The Trustee, or
any trustee or trustees hereafter appointed, may at any time resign by giving
written notice of such resignation to the Company and by mailing notice
thereof, at the Company’s expense, to the holders of the Debentures at their
addresses as they shall appear on the Debenture Register.  Upon receiving such notice of resignation,
the Company shall promptly appoint a successor trustee or trustees by written
instrument, in duplicate, executed by order of its Board of Directors, one copy
of which instrument shall be delivered to the resigning Trustee and one copy to
the successor Trustee.  If no successor
Trustee shall have been so appointed and have accepted appointment within 30
days after the mailing of such notice of resignation to the affected
Securityholders, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee, or any Securityholder who
has been a bona fide holder of a Debenture or Debentures for at least six
months may, subject to the provisions of Section 5.9, on behalf of himself
and all others similarly situated, petition any such court for the appointment
of a successor Trustee.  Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor Trustee.

 

(b)           In case at any
time any of the following shall occur --

 

(1)            the Trustee shall fail
to comply with the provisions of Section 6.8 after written request
therefor by the Company or by any Securityholder who has been a bona fide
holder of a Debenture or Debentures for at least 6 months, or

 

(2)            the Trustee shall
cease to be eligible in accordance with the provisions of Section 6.8 and
shall fail to resign after written request therefor by the Company or by any
such Securityholder, or

 

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

 

then, in any such case, the Company may remove the Trustee and appoint
a successor Trustee by written instrument, in duplicate, executed by order of
the 

 

34

 

Board of Directors, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor Trustee, or, subject to
the provisions of Section 5.9, any Securityholder who has been a bona fide
holder of a Debenture or Debentures for at least 6 months may, on behalf
of himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.  Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe, remove the Trustee
and appoint a successor Trustee.

 

(c)           Upon prior
written notice to the Company and the Trustee, the holders of a majority in
aggregate principal amount of the Debentures at the time outstanding may at any
time remove the Trustee and nominate a successor Trustee, which shall be deemed
appointed as successor Trustee unless within 10 Business Days after such
nomination the Company objects thereto, in which case, or in the case of a
failure by such holders to nominate a successor Trustee, the Trustee so removed
or any Securityholder, upon the terms and conditions and otherwise as in subsection (a)
of this Section 6.9 provided, may petition any court of competent
jurisdiction for an appointment of a successor.

 

(d)           Any resignation
or removal of the Trustee and appointment of a successor Trustee pursuant to
any of the provisions of this Section shall become effective upon acceptance of
appointment by the successor Trustee as provided in Section 6.10.

 

Section 6.10.        Acceptance by Successor Trustee.  Any successor Trustee appointed as provided
in Section 6.9 shall execute, acknowledge and deliver to the Company and
to its predecessor Trustee an instrument accepting such appointment hereunder,
and thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, duties and obligations with
respect to the Debentures of its predecessor hereunder, with like effect as if
originally named as Trustee herein; but, nevertheless, on the written request
of the Company or of the successor Trustee, the Trustee ceasing to act shall,
upon payment of any amounts then due it pursuant to the provisions of
Section 6.6, execute and deliver an instrument transferring to such
successor Trustee all the rights and powers of the Trustee so ceasing to act
and shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee thereunder.  Upon request of any such successor Trustee,
the Company shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor Trustee all such rights
and powers.  Any Trustee ceasing to act
shall, nevertheless, retain a lien upon all property or funds held or collected
by such Trustee to secure any amounts then due it pursuant to the provisions of
Section 6.6.

 

If a successor Trustee is appointed, the Company, the retiring Trustee
and the successor Trustee shall execute and deliver an indenture supplemental
hereto which shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Debentures as to which the predecessor
Trustee is not retiring shall continue to be vested in the predecessor Trustee,
and shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the Trust
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of
the same 

 

35

 

trust and that each such
Trustee shall be Trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee.

 

No successor Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Trustee shall be
eligible under the provisions of Section 6.8.

 

In no event shall a retiring Trustee be liable for the acts or
omissions of any successor Trustee hereunder.

 

Upon acceptance of appointment by a successor Trustee as provided in
this Section 6.10, the Company shall mail notice of the succession of such
Trustee hereunder to the holders of Debentures at their addresses as they shall
appear on the Debenture Register.  If the
Company fails to mail such notice within 10 Business Days after the acceptance
of appointment by the successor Trustee, the successor Trustee shall cause such
notice to be mailed at the expense of the Company.

 

Section 6.11.        Succession by Merger, etc.  Any corporation into which the Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder without the execution or filing of any paper or any further
act on the part of any of the parties hereto; provided such corporation
shall be otherwise eligible and qualified under this Article.

 

In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Debentures shall have been
authenticated but not delivered, any such successor to the Trustee may adopt
the certificate of authentication of any predecessor Trustee, and deliver such
Debentures so authenticated; and in case at that time any of the Debentures
shall not have been authenticated, any successor to the Trustee may
authenticate such Debentures either in the name of any predecessor hereunder or
in the name of the successor Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Debentures or in this
Indenture provided that the certificate of the Trustee shall have; provided,
however, that the right to adopt the certificate of authentication of
any predecessor Trustee or authenticate Debentures in the name of any
predecessor Trustee shall apply only to its successor or successors by merger,
conversion or consolidation.

 

Section 6.12.        Authenticating Agents.  There may be one or more Authenticating
Agents appointed by the Trustee upon the request of the Company with power to
act on its behalf and subject to its direction in the authentication and
delivery of Debentures issued upon exchange or registration of transfer thereof
as fully to all intents and purposes as though any such Authenticating Agent
had been expressly authorized to authenticate and deliver Debentures; provided,
however, that the Trustee shall have no liability to the Company for any
acts or omissions of the Authenticating Agent with respect to the
authentication and delivery of Debentures. 
Any such Authenticating Agent shall at all times be a corporation
organized and doing business under the laws of the United States or of any
state or territory thereof or of the District of Columbia authorized under such
laws to act as Authenticating Agent, having a 

 

36

 

combined capital and surplus
of at least $50,000,000.00 and being 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 the requirements of such
authority, then for the purposes of this Section 6.12 the combined capital
and surplus of such corporation shall be deemed to be its combined capital and surplus
as set forth in its most recent report of condition so published.  If at any time an Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect herein specified in
this Section.

 

Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of any Authenticating Agent, shall be the
successor of such Authenticating Agent hereunder, if such successor corporation
is otherwise eligible under this Section 6.12 without the execution or
filing of any paper or any further act on the part of the parties hereto or
such Authenticating Agent.

 

Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company.  The Trustee may at any time terminate the
agency of any Authenticating Agent with respect to the Debentures by giving
written notice of termination to such Authenticating Agent and to the Company.  Upon receiving such a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent
shall cease to be eligible under this Section 6.12, the Trustee may, and
upon the request of the Company shall, promptly appoint a successor
Authenticating Agent eligible under this Section 6.12, shall give written
notice of such appointment to the Company and shall mail notice of such
appointment to all holders of Debentures as the names and addresses of such
holders appear on the Debenture Register. 
Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all rights, powers, duties and
responsibilities with respect to the Debentures of its predecessor hereunder,
with like effect as if originally named as Authenticating Agent herein.

 

The Company agrees to pay to any Authenticating Agent from time to time
reasonable compensation for its services. 
Any Authenticating Agent shall have no responsibility or liability for
any action taken by it as such in accordance with the directions of the
Trustee.

 

ARTICLE VII.

CONCERNING THE SECURITYHOLDERS

 

Section 7.1.           Action by Securityholders.  Whenever in this Indenture it is provided
that the holders of a specified percentage in aggregate principal amount of the
Debentures may take any action (including the making of any demand or request,
the giving of any notice, consent or waiver or the taking of any other action)
the fact that at the time of taking any such action the holders of such
specified percentage have joined therein may be evidenced (a) by any
instrument or any number of instruments of similar tenor executed by such
Securityholders in person or by agent or proxy appointed in writing, or
(b) by the record of such holders of Debentures voting in favor thereof at
any meeting of such Securityholders duly called and held in accordance with the
provisions of Article VIII, or (c) by a combination of such
instrument or 

 

37

 

instruments and any such
record of such a meeting of such Securityholders or (d) by any other
method the Trustee deems satisfactory.

 

If the Company shall solicit from the Securityholders any request,
demand, authorization, direction, notice, consent, waiver or other action or
revocation of the same, the Company may, at its option, as evidenced by an
Officers’ Certificate, fix in advance a record date for such Debentures for the
determination of Securityholders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other action or revocation
of the same, but the Company shall have no obligation to do so.  If such a record date is fixed, such request,
demand, authorization, direction, notice, consent, waiver or other action or
revocation of the same may be given before or after the record date, but only
the Securityholders of record at the close of business on the record date shall
be deemed to be Securityholders for the purposes of determining whether
Securityholders of the requisite proportion of outstanding Debentures have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other action or revocation of the same,
and for that purpose the outstanding Debentures shall be computed as of the
record date; provided, however, that no such authorization,
agreement or consent by such Securityholders on the record date shall be deemed
effective unless it shall become effective pursuant to the provisions of this
Indenture not later than 6 months after the record date.

 

Section 7.2.           Proof of Execution by Securityholders.  Subject to the provisions of
Section 6.1, 6.2 and 8.5, proof of the execution of any instrument by a
Securityholder or his agent or proxy shall be sufficient if made in accordance
with such reasonable rules and regulations as may be prescribed by the Trustee
or in such manner as shall be satisfactory to the Trustee.  The ownership of Debentures shall be proved
by the Debenture Register or by a certificate of the Debenture registrar.  The Trustee may require such additional proof
of any matter referred to in this Section as it shall deem necessary.

 

The record of any Securityholders meeting shall be proved in the manner
provided in Section 8.6.

 

Section 7.3.           Who Are Deemed Absolute Owners.  Prior to due presentment for registration of
transfer of any Debenture, the Company, the Trustee, any Authenticating Agent,
any paying agent, any transfer agent and any Debenture registrar may deem the
Person in whose name such Debenture shall be registered upon the Debenture
Register to be, and may treat him as, the absolute owner of such Debenture
(whether or not such Debenture shall be overdue) for the purpose of receiving
payment of or on account of the principal of, premium, if any, and interest on
such Debenture and for all other purposes; and neither the Company nor the
Trustee nor any Authenticating Agent nor any paying agent nor any transfer
agent nor any Debenture registrar shall be affected by any notice to the
contrary.  All such payments so made to
any holder for the time being or upon his order shall be valid, and, to the
extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for moneys payable upon any such Debenture.

 

Section 7.4.           Debentures Owned by Company Deemed Not Outstanding.  In determining whether the holders of the
requisite aggregate principal amount of Debentures have concurred in any
direction, consent or waiver under this Indenture, Debentures which are owned 

 

38

 

by the Company or any other
obligor on the Debentures or by any Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Company or
any other obligor on the Debentures shall be disregarded and deemed not to be
outstanding for the purpose of any such determination; provided, however,
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, consent or waiver, only Debentures which a
Responsible Officer of the Trustee actually knows are so owned shall be so
disregarded.  Debentures so owned which
have been pledged in good faith may be regarded as outstanding for the purposes
of this Section 7.4 if the pledgee shall establish to the satisfaction of the
Trustee the pledgee’s right to vote such Debentures and that the pledgee is not
the Company or any such other obligor or Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company or any such other obligor. 
In the case of a dispute as to such right, any decision by the Trustee
taken upon the advice of counsel shall be full protection to the Trustee.

 

Section 7.5.           Revocation of Consents; Future Holders Bound.  At any time prior to (but not after) the
evidencing to the Trustee, as provided in Section 7.1, of the taking of
any action by the holders of the percentage in aggregate principal amount of
the Debentures specified in this Indenture in connection with such action, any
holder (in cases where no record date has been set pursuant to Section 7.1)
or any holder as of an applicable record date (in cases where a record date has
been set pursuant to Section 7.1) of a Debenture (or any Debenture issued
in whole or in part in exchange or substitution therefor) the serial number of
which is shown by the evidence to be included in the Debentures the holders of
which have consented to such action may, by filing written notice with the
Trustee at the Principal Office of the Trustee and upon proof of holding as
provided in Section 7.2, revoke such action so far as concerns such
Debenture (or so far as concerns the principal amount represented by any
exchanged or substituted Debenture). 
Except as aforesaid any such action taken by the holder of any Debenture
shall be conclusive and binding upon such holder and upon all future holders
and owners of such Debenture, and of any Debenture issued in exchange or
substitution therefor or on registration of transfer thereof, irrespective of
whether or not any notation in regard thereto is made upon such Debenture or
any Debenture issued in exchange or substitution therefor.

 

ARTICLE VIII.

SECURITYHOLDERS MEETINGS

 

Section 8.1.           Purposes of Meetings.  A meeting of Securityholders may be called at
any time and from time to time pursuant to the provisions of this Article VIII
for any of the following purposes:

 

(a)           to give any
notice to the Company or to the Trustee, or to give any directions to the
Trustee, or to consent to the waiving of any default hereunder and its
consequences, or to take any other action authorized to be taken by
Securityholders pursuant to any of the provisions of Article V;

 

(b)           to remove the
Trustee and nominate a successor trustee pursuant to the provisions of
Article VI;

 

39

 

(c)           to consent to
the execution of an indenture or indentures supplemental hereto pursuant to the
provisions of Section 9.2; or

 

(d)           to take any
other action authorized to be taken by or on behalf of the holders of any
specified aggregate principal amount of such Debentures under any other
provision of this Indenture or under applicable law.

 

Section 8.2.           Call of Meetings by Trustee.  The Trustee may at any time call a meeting of
Securityholders to take any action specified in Section 8.1, to be held at
such time and at such place as the Trustee shall determine.  Notice of every meeting of the
Securityholders, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be mailed
to holders of Debentures affected at their addresses as they shall appear on
the Debentures Register and, if the Company is not a holder of Debentures, to
the Company.  Such notice shall be mailed
not less than 20 nor more than 180 days prior to the date fixed for the
meeting.

 

Section 8.3.           Call of Meetings by Company or Securityholders.  In case at any time the Company pursuant to a
Board Resolution, or the holders of at least 10% in aggregate principal amount
of the Debentures, as the case may be, then outstanding, shall have requested
the Trustee to call a meeting of Securityholders, by written request setting
forth in reasonable detail the action proposed to be taken at the meeting, and
the Trustee shall not have mailed the notice of such meeting within
20 days after receipt of such request, then the Company or such
Securityholders may determine the time and the place for such meeting and may
call such meeting to take any action authorized in Section 8.1, by mailing
notice thereof as provided in Section 8.2.

 

Section 8.4.           Qualifications for Voting.  To be entitled to vote at any meeting of
Securityholders a Person shall be (a) a holder of one or more Debentures
with respect to which the meeting is being held or (b) a Person appointed
by an instrument in writing as proxy by a holder of one or more such
Debentures.  The only Persons who shall
be entitled to be present or to speak at any meeting of Securityholders shall
be the Persons entitled to vote at such meeting and their counsel and any representatives
of the Trustee and its counsel and any representatives of the Company and its
counsel.

 

Section 8.5.           Regulations. 
Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Securityholders, in regard to proof of the holding of Debentures and of the
appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit.

 

The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 8.3, in which case
the Company or the Securityholders calling the meeting, as the case may be,
shall in like manner appoint a temporary chairman.  A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the meeting.

 

40

 

Subject to the provisions of Section 7.4, at any meeting each
holder of Debentures with respect to which such meeting is being held or proxy
therefor shall be entitled to one vote for each $1,000.00 principal amount of
Debentures held or represented by him; provided, however, that no
vote shall be cast or counted at any meeting in respect of any Debenture
challenged as not outstanding and ruled by the chairman of the meeting to be
not outstanding.  The chairman of the
meeting shall have no right to vote other than by virtue of Debentures held by
him or instruments in writing as aforesaid duly designating him as the Person
to vote on behalf of other Securityholders. 
Any meeting of Securityholders duly called pursuant to the provisions of
Section 8.2 or 8.3 may be adjourned from time to time by a majority of
those present, whether or not constituting a quorum, and the meeting may be
held as so adjourned without further notice.

 

Section 8.6.           Voting.  The vote
upon any resolution submitted to any meeting of holders of Debentures with
respect to which such meeting is being held shall be by written ballots on
which shall be subscribed the signatures of such holders or of their
representatives by proxy and the serial number or numbers of the Debentures
held or represented by them.  The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in triplicate of all votes cast at the meeting.  A record in duplicate of the proceedings of
each meeting of Securityholders shall be prepared by the secretary of the
meeting and there shall be attached to said record the original reports of the
inspectors of votes on any vote by ballot taken thereat and affidavits by one
or more Persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that said notice was mailed as provided in
Section 8.2.  The record shall show
the serial numbers of the Debentures voting in favor of or against any
resolution.  The record shall be signed
and verified by the affidavits of the permanent chairman and secretary of the
meeting and one of the duplicates shall be delivered to the Company and the
other to the Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting.

 

Any record so signed and verified shall be conclusive evidence of the
matters therein stated.

 

Section 8.7.           Quorum; Actions.  The
Persons entitled to vote a majority in principal amount of the Debentures then
outstanding shall constitute a quorum for a meeting of Securityholders; provided,
however, that if any action is to be taken at such meeting with respect
to a consent, waiver, request, demand, notice, authorization, direction or
other action which may be given by the holders of not less than a specified
percentage in principal amount of the Debentures then outstanding, the Persons
holding or representing such specified percentage in principal amount of the
Debentures then outstanding will constitute a quorum.  In the absence of a quorum within
30 minutes of the time appointed for any such meeting, the meeting shall,
if convened at the request of Securityholders, be dissolved.  In any other case the meeting may be
adjourned for a period of not less than 10 days as determined by the
permanent chairman of the meeting prior to the adjournment of such meeting.  In the absence of a quorum at any such
adjourned meeting, such adjourned meeting may be further adjourned for a period
of not less than 10 days as determined by the permanent chairman of the
meeting prior to the adjournment of such adjourned meeting.  Notice of the reconvening of any adjourned
meeting shall be given as provided in Section 8.2, except that such notice
need be given only once not less than 5 days prior to the date on which the
meeting is scheduled to be reconvened. 
Notice of the reconvening 

 

41

 

of an adjourned meeting
shall state expressly the percentage, as provided above, of the principal
amount of the Debentures then outstanding which shall constitute a quorum.

 

Except as limited by the provisos in the first paragraph of
Section 9.2, any resolution presented to a meeting or adjourned meeting
duly reconvened at which a quorum is present as aforesaid may be adopted by the
affirmative vote of the holders of a majority in principal amount of the
Debentures then outstanding; provided, however, that, except as
limited by the provisos in the first paragraph of Section 9.2, any
resolution with respect to any consent, waiver, request, demand, notice,
authorization, direction or other action which this Indenture expressly
provides may be given by the holders of not less than a specified percentage in
principal amount of the Debentures then outstanding may be adopted at a meeting
or an adjourned meeting duly reconvened and at which a quorum is present as
aforesaid only by the affirmative vote of the holders of a not less than such
specified percentage in principal amount of the Debentures then outstanding.

 

Any resolution passed or decision taken at any meeting of holders of
Debentures duly held in accordance with this Section shall be binding on all
the Securityholders, whether or not present or represented at the meeting.

 

ARTICLE IX.

SUPPLEMENTAL INDENTURES

 

Section 9.1.           Supplemental Indentures without Consent of Securityholders.  The Company, when authorized by a Board
Resolution, and the Trustee may from time to time and at any time enter into an
indenture or indentures supplemental hereto, without the consent of the
Securityholders, for one or more of the following purposes:

 

(a)           to evidence the
succession of another Person to the Company, or successive successions, and the
assumption by the successor Person of the covenants, agreements and obligations
of the Company, pursuant to Article XI hereof;

 

(b)           to add to the
covenants of the Company such further covenants, restrictions or conditions for
the protection of the holders of Debentures as the Board of Directors shall
consider to be for the protection of the holders of such Debentures, and to
make the occurrence, or the occurrence and continuance, of a default in any of
such additional covenants, restrictions or conditions a default or an Event of
Default permitting the enforcement of all or any of the several remedies
provided in this Indenture as herein set forth; provided, however,
that in respect of any such additional covenant restriction or condition such
supplemental indenture may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate enforcement upon such default
or may limit the remedies available to the Trustee upon such default;

 

(c)           to cure any
ambiguity or to correct or supplement any provision contained herein or in any
supplemental indenture which may be defective or inconsistent with any other
provision contained herein or in any supplemental indenture, or to make such
other provisions in regard to matters or questions arising under this
Indenture; provided that any such action shall not materially adversely
affect the interests of the holders of the Debentures;

 

42

 

(d)           to add to,
delete from, or revise the terms of Debentures, including, without limitation,
any terms relating to the issuance, exchange, registration or transfer of
Debentures, including to provide for transfer procedures and restrictions
substantially similar to those applicable to the Capital Securities as required
by Section 2.5 (for purposes of assuring that no registration of
Debentures is required under the Securities Act); provided, however,
that any such action shall not adversely affect the interests of the holders of
the Debentures then outstanding (it being understood, for purposes of this
proviso, that transfer restrictions on Debentures substantially similar to
those that were applicable to Capital Securities shall not be deemed to
materially adversely affect the holders of the Debentures);

 

(e)           to evidence and
provide for the acceptance of appointment hereunder by a successor Trustee with
respect to the Debentures and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee;

 

(f)            to make any
change (other than as elsewhere provided in this paragraph) that does not
adversely affect the rights of any Securityholder in any material respect; or

 

(g)           to provide for
the issuance of and establish the form and terms and conditions of the
Debentures, to establish the form of any certifications required to be
furnished pursuant to the terms of this Indenture or the Debentures, or to add
to the rights of the holders of Debentures.

 

The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer and assignment of any property thereunder, but the Trustee
shall not be obligated to, but may in its discretion, enter into any such
supplemental indenture which affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise.

 

Any supplemental indenture authorized by the provisions of this
Section 9.1 may be executed by the Company and the Trustee without the
consent of the holders of any of the Debentures at the time outstanding,
notwithstanding any of the provisions of Section 9.2.

 

Section 9.2.           Supplemental Indentures with Consent of Securityholders.  With the consent (evidenced as provided in
Section 7.1) of the holders of not less than a majority in aggregate
principal amount of the Debentures at the time outstanding affected by such
supplemental indenture (voting as a class), the Company, when authorized by a
Board Resolution, and the Trustee may from time to time and at any time enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of modifying
in any manner the rights of the holders of the Debentures; provided, however,
that no such supplemental indenture shall without the consent of the holders of
each Debenture then outstanding and affected thereby (i) change the fixed
maturity of any Debenture, or reduce the principal amount thereof or any
premium thereon, or reduce the rate or extend the time of payment of interest
thereon, or reduce any amount payable on redemption thereof or make the
principal thereof or any interest or premium thereon payable in any coin or
currency other than that provided in the Debentures, or impair or affect the
right of any Securityholder to institute 

 

43

 

suit for payment thereof or
impair the right of repayment, if any, at the option of the holder, or
(ii) reduce the aforesaid percentage of Debentures the holders of which
are required to consent to any such supplemental indenture; provided  further,
however, that if the Debentures are held by a trust or a trustee of such
trust, such supplemental indenture shall not be effective until the holders of
a majority in Liquidation Amount of Trust Securities shall have consented to
such supplemental indenture; provided  further, however,
that if the consent of the Securityholder of each outstanding Debenture is
required, such supplemental indenture shall not be effective until each holder
of the Trust Securities shall have consented to such supplemental indenture.

 

Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee’s
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.

 

Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall transmit by mail, first class postage prepaid, a notice, prepared by the
Company, setting forth in general terms the substance of such supplemental
indenture, to the Securityholders as their names and addresses appear upon the
Debenture Register.  Any failure of the
Trustee to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.

 

It shall not be necessary for the consent of the Securityholders under
this Section 9.2 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent shall approve
the substance thereof.

 

Section 9.3.           Effect of Supplemental Indentures.  Upon the execution of any supplemental
indenture pursuant to the provisions of this Article IX, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and
immunities under this Indenture of the Trustee, the Company and the holders of
Debentures shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.

 

Section 9.4.           Notation on Debentures.  Debentures authenticated and delivered after
the execution of any supplemental indenture pursuant to the provisions of this
Article IX may bear a notation as to any matter provided for in such
supplemental indenture.  If the Company
or the Trustee shall so determine, new Debentures so modified as to conform, in
the opinion of the Board of Directors of the Company, to any modification of
this Indenture contained in any such supplemental indenture may be prepared and
executed by the Company, authenticated by the Trustee or the Authenticating
Agent and delivered in exchange for the Debentures then outstanding.

 

44

 

Section 9.5.           Evidence of Compliance of Supplemental Indenture to be Furnished to
Trustee.  The Trustee,
subject to the provisions of Sections 6.1 and 6.2, shall, in addition to
the documents required by Section 14.6, receive an Officers’ Certificate
and an Opinion of Counsel as conclusive evidence that any supplemental
indenture executed pursuant hereto complies with the requirements of this
Article IX.  The Trustee shall
receive an Opinion of Counsel as conclusive evidence that any supplemental
indenture executed pursuant to this Article IX is authorized or permitted
by, and conforms to, the terms of this Article IX and that it is proper
for the Trustee under the provisions of this Article IX to join in the
execution thereof.

 

ARTICLE X.

REDEMPTION OF SECURITIES

 

Section 10.1.         Optional Redemption.  The Company shall have the right to redeem
the Debentures, in whole or in part, but in all cases in a principal amount
with integral multiples of $1,000.00, on any August 15, November 15, February
15 or May 15 on or after May 15, 2008 (an “Optional Redemption Date”),
at the Optional Redemption Price.

 

Section 10.2.        Special Event Redemption.  If a Special Event shall occur and be
continuing, the Company shall have the right to redeem the Debentures in whole,
but not in part, at any Interest Payment Date, within 120 days following
the occurrence of such Special Event (the “Special Redemption Date”) at
the Special Redemption Price.

 

Section 10.3.        Notice of Redemption; Selection of Debentures.  In case the Company shall desire to exercise
the right to redeem all, or, as the case may be, any part of the Debentures, it
shall cause to be mailed a notice of such redemption at least 30 and not more
than 60 days prior to the Optional Redemption Date or the Special
Redemption Date to the holders of Debentures so to be redeemed as a whole or in
part at their last addresses as the same appear on the Debenture Register.  Such mailing shall be by first class
mail.  The notice if mailed in the manner
herein provided shall be conclusively presumed to have been duly given, whether
or not the holder receives such notice. 
In any case, failure to give such notice by mail or any defect in the
notice to the holder of any Debenture designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Debenture.

 

Each such notice of redemption shall specify the CUSIP number, if any,
of the Debentures to be redeemed, the Optional Redemption Date or the Special
Redemption Date, as applicable, the Optional Redemption Price or the Special
Redemption Price, as applicable, at which Debentures are to be redeemed, the
place or places of payment, that payment will be made upon presentation and
surrender of such Debentures, that interest accrued to the date fixed for
redemption will be paid as specified in said notice, and that on and after said
date interest thereon or on the portions thereof to be redeemed will cease to
accrue.  If less than all the Debentures
are to be redeemed the notice of redemption shall specify the numbers of the
Debentures to be redeemed.  In case the
Debentures are to be redeemed in part only, the notice of redemption shall
state the portion of the principal amount thereof to be redeemed and shall
state that on and after the date fixed for redemption, upon surrender of such
Debenture, a new Debenture or Debentures in principal amount equal to the
unredeemed portion thereof will be issued.

 

45

 

Prior to 10:00 a.m. (New York City time) on the Optional Redemption
Date or Special Redemption Date, as applicable, the Company will deposit with
the Trustee or with one or more paying agents an amount of money sufficient to
redeem on the Optional Redemption Date or the Special Redemption Date, as
applicable, all the Debentures so called for redemption at the appropriate
Optional Redemption Price or Special Redemption Price, together with accrued
interest to the Optional Redemption Date or Special Redemption Date, as
applicable.

 

If all, or less than all, the Debentures are to be redeemed, the
Company will give the Trustee notice not less than 45 nor more than
60 days, respectively, prior to the Optional Redemption Date or Special
Redemption Date, as applicable, as to the aggregate principal amount of
Debentures to be redeemed and the Trustee shall select, in such manner as in
its sole discretion it shall deem appropriate and fair, the Debentures or
portions thereof (in integral multiples of $1,000.00) to be redeemed.

 

Section 10.4.        Payment of Debentures Called for Redemption.  If notice of redemption has been given as
provided in Section 10.3, the Debentures or portions of Debentures with
respect to which such notice has been given shall become due and payable on the
Optional Redemption Date or Special Redemption Date, as applicable, and at the
place or places stated in such notice at the applicable Optional Redemption
Price or Special Redemption Price, together with interest accrued to the
Optional Redemption Date or Special Redemption Date, as applicable, and on and
after said date (unless the Company shall default in the payment of such
Debentures at the Optional Redemption Price or Special Redemption Price, as
applicable, together with interest accrued to said date) interest on the
Debentures or portions of Debentures so called for redemption shall cease to
accrue.  On presentation and surrender of
such Debentures at a place of payment specified in said notice, such Debentures
or the specified portions thereof shall be paid and redeemed by the Company at
the applicable Optional Redemption Price or Special Redemption Price, together
with interest accrued thereon to the Optional Redemption Date or Special
Redemption Date, as applicable.

 

Upon presentation of any Debenture redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Debenture
or Debentures of authorized denominations, in principal amount equal to the
unredeemed portion of the Debenture so presented.

 

ARTICLE XI.

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

 

Section 11.1.        Company May Consolidate, etc., on Certain Terms.  Nothing contained in this Indenture or in the
Debentures shall prevent any consolidation or merger of the Company with or
into any other Person (whether or not affiliated with the Company) or successive
consolidations or mergers in which the Company or its successor or successors
shall be a party or parties, or shall prevent any sale, conveyance, transfer or
other disposition of the property or capital stock of the Company or its
successor or successors as an entirety, or substantially as an entirety, to any
other Person (whether or not affiliated with the Company, or its successor or
successors) authorized to acquire and operate the same; provided, however,
that the Company hereby covenants and agrees that, upon any such consolidation,
merger (where the Company is not the surviving corporation), sale, conveyance,
transfer or other disposition, the due and 

 

46

 

punctual payment of the
principal of (and premium, if any) and interest on all of the Debentures in
accordance with their terms, according to their tenor, and the due and punctual
performance and observance of all the covenants and conditions of this
Indenture to be kept or performed by the Company, shall be expressly assumed by
supplemental indenture satisfactory in form to the Trustee executed and
delivered to the Trustee by the entity formed by such consolidation, or into
which the Company shall have been merged, or by the entity which shall have
acquired such property or capital stock.

 

Section 11.2.        Successor Entity to be Substituted.  In case of any such consolidation, merger,
sale, conveyance, transfer or other disposition and upon the assumption by the
successor entity, by supplemental indenture, executed and delivered to the
Trustee and satisfactory in form to the Trustee, of the due and punctual
payment of the principal of and premium, if any, and interest on all of the
Debentures and the due and punctual performance and observance of all of the
covenants and conditions of this Indenture to be performed or observed by the
Company, such successor entity shall succeed to and be substituted for the
Company, with the same effect as if it had been named herein as the Company,
and thereupon the predecessor entity shall be relieved of any further liability
or obligation hereunder or upon the Debentures. 
Such successor entity thereupon may cause to be signed, and may issue in
its own name, any or all of the Debentures issuable hereunder which theretofore
shall not have been signed by the Company and delivered to the Trustee or the
Authenticating Agent; and, upon the order of such successor entity instead of
the Company and subject to all the terms, conditions and limitations in this
Indenture prescribed, the Trustee or the Authenticating Agent shall
authenticate and deliver any Debentures which previously shall have been signed
and delivered by the officers of the Company, to the Trustee or the
Authenticating Agent for authentication, and any Debentures which such
successor entity thereafter shall cause to be signed and delivered to the
Trustee or the Authenticating Agent for that purpose.  All the Debentures so issued shall in all
respects have the same legal rank and benefit under this Indenture as the
Debentures theretofore or thereafter issued in accordance with the terms of
this Indenture as though all of such Debentures had been issued at the date of
the execution hereof.

 

Section 11.3.        Opinion of Counsel to be Given to Trustee.  The Trustee, subject to the provisions of
Sections 6.1 and 6.2, shall receive, in addition to the Opinion of Counsel
required by Section 9.5, an Opinion of Counsel as conclusive evidence that
any consolidation, merger, sale, conveyance, transfer or other disposition, and
any assumption, permitted or required by the terms of this Article XI
complies with the provisions of this Article XI.

 

ARTICLE XII.

SATISFACTION AND DISCHARGE OF INDENTURE

 

Section 12.1.        Discharge of Indenture.   When

 

(a)                          the Company shall deliver to
the Trustee for cancellation all Debentures theretofore authenticated (other
than any Debentures which shall have been destroyed, lost or stolen and which
shall have been replaced or paid as provided in Section 2.6) and not
theretofore canceled, or

 

47

 

(b)                         all the Debentures not
theretofore canceled or delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
1 year or are to be called for redemption within 1 year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company shall deposit with the Trustee, in trust, funds, which shall be
immediately due and payable, sufficient to pay at maturity or upon redemption
all of the Debentures (other than any Debentures which shall have been
destroyed, lost or stolen and which shall have been replaced or paid as
provided in Section 2.6) not theretofore canceled or delivered to the
Trustee for cancellation, including principal and premium, if any, and interest
due or to become due to such date of maturity or redemption date, as the case
may be, but excluding, however, the amount of any moneys for the payment of
principal of, and premium, if any, or interest on the Debentures
(1) theretofore repaid to the Company in accordance with the provisions of
Section 12.4, or (2) paid to any state or to the District of Columbia
pursuant to its unclaimed property or similar laws,

 

and if in the case of either clause (a) or clause (b) the
Company shall also pay or cause to be paid all other sums payable hereunder by
the Company, then this Indenture shall cease to be of further effect except for
the provisions of Sections 2.5, 2.6, 2.8, 3.1, 3.2, 3.4, 6.6, 6.8, 6.9 and
12.4 hereof shall survive until such Debentures shall mature and be paid.  Thereafter, Sections 6.6 and 12.4 shall
survive, and the Trustee, on demand of the Company accompanied by an Officers’
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with, and at the cost and expense of the
Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture.  The Company
agrees to reimburse the Trustee for any costs or expenses thereafter reasonably
and properly incurred by the Trustee in connection with this Indenture or the
Debentures.

 

Section 12.2.        Deposited Moneys to be Held in Trust by Trustee.  Subject to the provisions of
Section 12.4, all moneys deposited with the Trustee pursuant to
Section 12.1 shall be held in trust in a non-interest bearing account and
applied by it to the payment, either directly or through any paying agent (including
the Company if acting as its own paying agent), to the holders of the
particular Debentures for the payment of which such moneys have been deposited
with the Trustee, of all sums due and to become due thereon for principal, and
premium, if any, and interest.

 

Section 12.3.        Paying Agent to Repay Moneys Held.  Upon the satisfaction and discharge of this
Indenture all moneys then held by any paying agent of the Debentures (other
than the Trustee) shall, upon demand of the Company, be repaid to it or paid to
the Trustee, and thereupon such paying agent shall be released from all further
liability with respect to such moneys.

 

Section 12.4.        Return of Unclaimed Moneys.  Any moneys deposited with or paid to the
Trustee or any paying agent for payment of the principal of, and premium, if
any, or interest on Debentures and not applied but remaining unclaimed by the
holders of Debentures for 2 years after the date upon which the principal of,
and premium, if any, or interest on such Debentures, as the case may be, shall
have become due and payable, shall, subject to applicable escheatment 

 

48

 

laws, be repaid to the
Company by the Trustee or such paying agent on written demand; and the holder
of any of the Debentures shall thereafter look only to the Company for any
payment which such holder may be entitled to collect, and all liability of the
Trustee or such paying agent with respect to such moneys shall thereupon cease.

 

ARTICLE XIII.

IMMUNITY OF INCORPORATORS, STOCKHOLDERS,

OFFICERS AND DIRECTORS

 

Section 13.1.        Indenture and Debentures Solely Corporate Obligations.  No recourse for the payment of the principal
of or premium, if any, or interest on any Debenture, or for any claim based
thereon or otherwise in respect thereof, and no recourse under or upon any
obligation, covenant or agreement of the Company in this Indenture or in any
supplemental indenture, or in any such Debenture, or because of the creation of
any indebtedness represented thereby, shall be had against any incorporator,
stockholder, employee, officer or director, as such, past, present or future,
of the Company or of any successor Person of the Company, either directly or
through the Company or any successor Person of the Company, whether by virtue
of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the
Debentures.

 

ARTICLE XIV.

MISCELLANEOUS PROVISIONS

 

Section 14.1.        Successors.  All the
covenants, stipulations, promises and agreements of the Company in this
Indenture shall bind its successors and assigns whether so expressed or not.

 

Section 14.2.        Official Acts by Successor Entity.  Any act or proceeding by any provision of
this Indenture authorized or required to be done or performed by any board,
committee or officer of the Company shall and may be done and performed with
like force and effect by the like board, committee, officer or other authorized
Person of any entity that shall at the time be the lawful successor of the
Company.

 

Section 14.3.        Surrender of Company Powers.  The Company by instrument in writing executed
by authority of at least 2/3 (two-thirds) of its Board of Directors and
delivered to the Trustee may surrender any of the powers reserved to the
Company and thereupon such power so surrendered shall terminate both as to the
Company, and as to any permitted successor.

 

Section 14.4.        Addresses for Notices, etc.  Any notice, consent, direction, request,
authorization, waiver or demand which by any provision of this Indenture is
required or permitted to be given, made, furnished or served by the Trustee or
by the Securityholders on or to the Company may be given or served in writing
by being deposited postage prepaid by registered or certified mail in a post
office letter box addressed (until another address is filed by the Company,
with the Trustee for the purpose) to the Company, 140 Broadway, 47th Floor, New
York, New York 10005 Attention:  Adam R.
Willkomm.  Any notice, consent,
direction, request, authorization, waiver or demand by any Securityholder or
the Company to or upon the 

 

49

 

Trustee shall be deemed to
have been sufficiently given or made, for all purposes, if given or made in
writing at the office of the Trustee, addressed to the Trustee, 225 Asylum
Street, Goodwin Square, Hartford, Connecticut 06103 Attention: Vice President,
Corporate Trust Services, with a copy to the Trustee, 1 Federal Street, Boston,
Massachusetts 02110, Attention: 
Paul D. Allen, Corporate Trust Services.  Any notice, consent, direction, request,
authorization, waiver or demand on or to any Securityholder shall be deemed to
have been sufficiently given or made, for all purposes, if given or made in
writing at the address set forth in the Debenture Register.

 

Section 14.5.        Governing Law.  This
Indenture and each Debenture shall be deemed to be a contract made under the
law of the State of New York, and for all purposes shall be governed by and
construed in accordance with the law of said State, without regard to conflict
of laws principles thereof, except with respect to authorization and execution
by or on behalf of the Company which are required to be governed by the laws of
Bermuda.

 

Section 14.6.        Evidence of Compliance with Conditions Precedent.  Upon any application or demand by the Company
to the Trustee to take any action under any of the provisions of this
Indenture, the Company shall furnish to the Trustee an Officers’ Certificate
stating that in the opinion of the signers all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.

 

Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or
covenant provided for in this Indenture shall include (1) a statement that
the person making such certificate or opinion has read such covenant or
condition; (2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based; (3) a statement that, in the opinion of
such person, he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and (4) a statement as to whether or not
in the opinion of such person, such condition or covenant has been complied
with.

 

Section 14.7.        Non-Business Days.  In any case where the date of payment of
interest on or principal of the Debentures will be a day that is not a Business
Day, the payment of such interest on or principal of the Debentures need not be
made on such date but may be made on the next succeeding Business Day, except
that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on the original date of payment, and
no interest shall accrue for the period from and after such date.

 

Section 14.8.        Table of Contents, Headings, etc.  The table of contents and the titles and
headings of the articles and sections of this Indenture have been inserted for
convenience of reference only, are not to be considered a part hereof, and
shall in no way modify or restrict any of the terms or provisions hereof.

 

50

 

Section 14.9.        Execution in Counterparts.  This Indenture may be executed in any number
of counterparts, each of which shall be an original, but such counterparts
shall together constitute but one and the same instrument.

 

Section 14.10.      Separability.  In
case any one or more of the provisions contained in this Indenture or in the
Debentures 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 Indenture or of such Debentures, but this
Indenture and such Debentures shall be construed as if such invalid or illegal
or unenforceable provision had never been contained herein or therein.

 

Section 14.11.      Assignment.  The Company
will have the right at all times to assign any of its rights or obligations
under this Indenture to a direct or indirect wholly owned Subsidiary of the
Company, provided that, in the event of any such assignment, the Company will
remain liable for all such obligations. 
Subject to the foregoing, this Indenture is binding upon and inures to
the benefit of the parties hereto and their respective successors and
assigns.  This Indenture may not
otherwise be assigned by the parties hereto.

 

Section 14.12.      Acknowledgment of Rights.  The Company agrees that, with respect to any
Debentures held by the Trust or the Institutional Trustee of the Trust, if the
Institutional Trustee of the Trust fails to enforce its rights under this
Indenture as the holder of Debentures held as the assets of such Trust after
the holders of a majority in Liquidation Amount of the Capital Securities of
such Trust have so directed such Institutional Trustee, a holder of record of
such Capital Securities may, to the fullest extent permitted by law, institute
legal proceedings directly against the Company to enforce such Institutional
Trustee’s rights under this Indenture without first instituting any legal
proceedings against such trustee or any other Person.  Notwithstanding the foregoing, if an Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Company to pay interest (or premium, if any) or principal on the
Debentures on the date such interest (or premium, if any) or principal is
otherwise payable (or in the case of redemption, on the redemption date), the
Company agrees that a holder of record of Capital Securities of the Trust may
directly institute a proceeding against the Company for enforcement of payment
to such holder directly of the principal of (or premium, if any) or interest on
the Debentures having an aggregate principal amount equal to the aggregate
Liquidation Amount of the Capital Securities of such holder on or after the
respective due date specified in the Debentures.

 

Section 14.13.      Submission to Jurisdiction; Appointment of Agent for Service.  In further consideration of
the agreement of the Trustee herein contained, the Company agrees and covenants
as follows:

 

The Company irrevocably agrees that any legal suit, action or
proceeding against the Company brought by the Trustee arising out of or based
upon this Indenture or the transactions contemplated hereby may be instituted
in any United States Federal or state court in the Borough of Manhattan, The
City of New York, State of New York (a “New York Court”), and irrevocably
waives any objection which it may now or hereafter have to the laying of venue
of any such proceeding, irrevocably waives any objection based on the absence
of a necessary or indispensable party in any such proceeding and irrevocably
submits to the non-exclusive 

 

51

 

jurisdiction of such courts in
any such suit, action or proceeding.  The
Company irrevocably waives any immunity to jurisdiction to which it may
otherwise be entitled or become entitled (including immunity to pre-judgment
attachment and execution) in any legal suit, action or proceeding against it
arising out of this Indenture or the transactions contemplated hereby which is
instituted in any New York Court or in any foreign court.  To the extent permitted by law, the Company
hereby waives any objection to the enforcement by any competent foreign court
of any judgment validly obtained in any such proceeding.  The Company designates and appoints
Corporation Service Company in Albany, New York as its authorized agent (the
“Authorized Agent”) upon which process may be served in any such action arising
out of or based on this Indenture or the transactions contemplated hereby which
may be instituted in any New York Court by the Trustee, expressly consents to
the non-exclusive jurisdiction of any such court in respect of any such action,
and waives any other requirements of or objections to personal jurisdiction
with respect thereto.  Such appointments
shall be irrevocable.  The Company
represents and warrants that its Authorized Agent has agreed to act as said agent
for service of process and the Company agrees to take any and all action,
including the filing of any and all documents and instruments, that may be
necessary to continue such appointment in full force and effect as aforesaid.  Service of process upon the Authorized Agent
and written notice of such service of process to it shall be deemed, in every
respect, effective service of process upon the Company.  Notwithstanding the foregoing, any action
based on this Indenture or the transactions contemplated hereby may be
instituted by the Trustee in any competent foreign court.

 

The provisions of this Section 14.13 shall survive any termination of
this Indenture, in whole or in part.

 

Section 14.14.      Judgment Currency.  The Company agrees,
to the fullest extent that it may effectively do so under applicable law, that
(a) if for the purpose of obtaining judgment in any court it is necessary to
convert the sum due in respect of the principal of, and premium, interest, and
Additional Sums, if any, on the Debentures (the “Required Currency”) into a
currency in which a judgment will be rendered (the “Judgment Currency”), the
rate of exchange used shall be the rate at which in accordance with normal
banking procedures the Trustee could purchase in The City of New York the
requisite amount of the Required Currency with the Judgment Currency on the
Business Day preceding the day on which a final unappealable judgment is given
and (b) its obligations under this Indenture to make payments in the Required
Currency (i) shall not be discharged or satisfied by any tender, or any
recovery pursuant to any judgment (whether or not entered into in accordance
with clause (a)), in any currency other than the Required Currency, except to
the extent that such tender or recovery shall result in the actual receipt, by
the payee, of the full amount of the Required Currency expressed to be payable
in respect of such payments, (ii) shall be enforceable as an alternative or
additional cause of action for the purpose of recovering in the Required
Currency the amount, if any, by which such actual receipt shall fall short of
the full amount of the Required Currency so expressed to be payable and (iii)
shall not be affected by judgment being obtained for any other sum due under
this Indenture.

 

Section 14.15.      Waiver of Immunity.  To the extent that
the Company has or hereafter may acquire any immunity (sovereign or otherwise)
from any legal action, suit or proceeding, from jurisdiction of any court or
from set-off or any legal process (whether service or notice, attachment in aid
or otherwise) with respect to itself or any of its property, the Company hereby

 

52

 

irrevocably waives and
agrees not to plead or claim such immunity in respect of its obligations under
this Indenture.

 

ARTICLE XV.

SUBORDINATION OF DEBENTURES

 

Section 15.1.        Agreement to Subordinate.  The Company covenants and agrees, and each
holder of Debentures by such Securityholder’s acceptance thereof likewise
covenants and agrees, that all Debentures shall be issued subject to the
provisions of this Article XV; and each holder of a Debenture, whether
upon original issue or upon transfer or assignment thereof, accepts and agrees
to be bound by such provisions.

 

The payment by the Company of the principal of, and premium, if any,
and interest on all Debentures shall, to the extent and in the manner
hereinafter set forth, be subordinated and junior in right of payment to the
prior payment in full of all Senior Indebtedness of the Company, whether
outstanding at the date of this Indenture or thereafter incurred.

 

The Debentures shall rank pari passu
with that certain Floating Rate Junior Subordinated Deferrable Interest
Debenture issued by the Company on December 4, 2002, in the principal amount of
$18,042,000.00.

 

No provision of this Article XV shall prevent the occurrence of
any default or Event of Default hereunder.

 

Section 15.2.        Default on Senior Indebtedness.  In the event and during the continuation of
any default by the Company in the payment of principal, premium, interest or
any other payment due on any Senior Indebtedness of the Company following any
grace period, or in the event that the maturity of any Senior Indebtedness of
the Company has been accelerated because of a default and such acceleration has
not been rescinded or canceled and such Senior Indebtedness has not been paid
in full, then, in either case, no payment shall be made by the Company with
respect to the principal (including redemption) of, or premium, if any, or interest
on the Debentures.

 

In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraph of this Section 15.2, such payment shall, subject to
Section 15.7, be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Indebtedness may have been issued, as their respective
interests may appear, but only to the extent that the holders of the Senior
Indebtedness (or their representative or representatives or a trustee) notify
the Trustee in writing within 90 days of such payment of the amounts then
due and owing on the Senior Indebtedness and only the amounts specified in such
notice to the Trustee shall be paid to the holders of Senior Indebtedness.

 

Section 15.3.        Liquidation, Dissolution, Bankruptcy.  Upon any payment by the Company or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, to creditors upon any dissolution or winding-up
or liquidation or reorganization of the Company, whether voluntary or
involuntary or in bankruptcy, insolvency, 

 

53

 

receivership or other
proceedings, all amounts due upon all Senior Indebtedness of the Company shall
first be paid in full, or payment thereof provided for in money in accordance
with its terms, before any payment is made by the Company, on account of the
principal (and premium, if any) or interest on the Debentures.  Upon any such dissolution or winding-up or
liquidation or reorganization, any payment by the Company, or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, to which the Securityholders or the Trustee would be entitled to
receive from the Company, except for the provisions of this Article XV,
shall be paid by the Company, or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Securityholders or by the Trustee under this Indenture if received by
them or it, directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of
the respective amounts of Senior Indebtedness held by such holders, as
calculated by the Company) or their representative or representatives, or to
the trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay such Senior Indebtedness
in full, in money or money’s worth, after giving effect to any concurrent
payment or distribution to or for the holders of such Senior Indebtedness,
before any payment or distribution is made to the Securityholders or to the
Trustee.

 

In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, prohibited by the foregoing, shall be received by
the Trustee before all Senior Indebtedness is paid in full, or provision is
made for such payment in money in accordance with its terms, such payment or
distribution shall be held in trust for the benefit of and shall be paid over
or delivered to the holders of such Senior Indebtedness or their representative
or representatives, or to the trustee or trustees under any indenture pursuant
to which any instruments evidencing such Senior Indebtedness may have been
issued, as their respective interests may appear, as calculated by the Company,
for application to the payment of all Senior Indebtedness, remaining unpaid to
the extent necessary to pay such Senior Indebtedness in full in money in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.

 

For purposes of this Article XV, the words “cash, property or
securities” shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in this
Article XV with respect to the Debentures to the payment of all Senior
Indebtedness, that may at the time be outstanding, provided that (i) such
Senior Indebtedness is assumed by the new corporation, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the
holders of such Senior Indebtedness are not, without the consent of such
holders, altered by such reorganization or readjustment.  The consolidation of the Company with, or the
merger of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon
the terms and conditions provided for in Article XI of this Indenture
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Section if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, comply with the conditions
stated in Article XI of this Indenture. 
Nothing in 

 

54

 

Section 15.2 or in this
Section shall apply to claims of, or payments to, the Trustee under or pursuant
to Section 6.6 of this Indenture.

 

Section 15.4.        Subrogation. 
Subject to the payment in full of all Senior Indebtedness, the
Securityholders shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company, applicable to such Senior Indebtedness until the
principal of (and premium, if any) and interest on the Debentures shall be paid
in full.  For the purposes of such
subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the Securityholders
or the Trustee would be entitled except for the provisions of this
Article XV, and no payment over pursuant to the provisions of this
Article XV to or for the benefit of the holders of such Senior Indebtedness
by Securityholders or the Trustee, shall, as between the Company, its creditors
other than holders of Senior Indebtedness of the Company, and the holders of
the Debentures be deemed to be a payment or distribution by the Company to or
on account of such Senior Indebtedness. 
It is understood that the provisions of this Article XV are and are
intended solely for the purposes of defining the relative rights of the holders
of the Securities, on the one hand, and the holders of such Senior Indebtedness,
on the other hand.

 

Nothing contained in this Article XV or elsewhere in this
Indenture or in the Debentures is intended to or shall impair, as between the
Company, its creditors other than the holders of Senior Indebtedness, and the
holders of the Debentures, the obligation of the Company, which is absolute and
unconditional, to pay to the holders of the Debentures the principal of (and
premium, if any) and interest on the Debentures as and when the same shall
become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the holders of the Debentures and creditors
of the Company, other than the holders of Senior Indebtedness, nor shall
anything herein or therein prevent the Trustee or the holder of any Debenture
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article XV
of the holders of such Senior Indebtedness in respect of cash, property or
securities of the Company, received upon the exercise of any such remedy.

 

Upon any payment or distribution of assets of the Company referred to
in this Article XV, the Trustee, subject to the provisions of
Article VI of this Indenture, and the Securityholders shall be entitled to
conclusively rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person making such
payment or distribution, delivered to the Trustee or to the Securityholders,
for the purposes of ascertaining the Persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this
Article XV.

 

Section 15.5.        Trustee to Effectuate Subordination.  Each Securityholder by such Securityholder’s
acceptance thereof authorizes and directs the Trustee on such Securityholder’s
behalf to take such action as may be necessary or appropriate to effectuate the
subordination 

 

55

 

provided in this
Article XV and appoints the Trustee such Securityholder’s attorney-in-fact
for any and all such purposes.

 

Section 15.6.        Notice by the Company.  The Company shall give prompt written notice
to a Responsible Officer of the Trustee at the Principal Office of the Trustee
of any fact known to the Company that would prohibit the making of any payment
of monies to or by the Trustee in respect of the Debentures pursuant to the
provisions of this Article XV. 
Notwithstanding the provisions of this Article XV or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment of
monies to or by the Trustee in respect of the Debentures pursuant to the provisions
of this Article XV, unless and until a Responsible Officer of the Trustee
at the Principal Office of the Trustee shall have received written notice
thereof from the Company or a holder or holders of Senior Indebtedness or from
any trustee therefor; and before the receipt of any such written notice, the
Trustee, subject to the provisions of Article VI of this Indenture, shall
be entitled in all respects to assume that no such facts exist; provided,
however, that if the Trustee shall not have received the notice provided
for in this Section at least 2 Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose (including,
without limitation, the payment of the principal of (or premium, if any) or
interest on any Debenture), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such money and to apply the same to the purposes for which they were received,
and shall not be affected by any notice to the contrary that may be received by
it within 2 Business Days prior to such date.

 

The Trustee, subject to the provisions of Article VI of this
Indenture, shall be entitled to conclusively rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or representative on behalf of such holder), to
establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee or representative on behalf of any such holder or
holders.  In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any Person as a holder of such Senior Indebtedness to participate in
any payment or distribution pursuant to this Article XV, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or distribution
and any other facts pertinent to the rights of such Person under this
Article XV, and, if such evidence is not furnished, the Trustee may defer
any payment to such Person pending judicial determination as to the right of
such Person to receive such payment.

 

Section 15.7.        Rights of the Trustee; Holders of Senior Indebtedness.  The Trustee in its individual capacity shall
be entitled to all the rights set forth in this Article XV in respect of
any Senior Indebtedness at any time held by it, to the same extent as any other
holder of Senior Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.

 

With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article XV, and no implied covenants
or obligations with respect to the holders of such Senior Indebtedness shall be
read into this Indenture against the Trustee. 
The Trustee shall not be 

 

56

 

deemed to owe any fiduciary
duty to the holders of such Senior Indebtedness and, subject to the provisions
of Article VI of this Indenture, the Trustee shall not be liable to any
holder of such Senior Indebtedness if it shall pay over or deliver to
Securityholders, the Company or any other Person money or assets to which any
holder of such Senior Indebtedness shall be entitled by virtue of this
Article XV or otherwise.

 

Nothing in this Article XV shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 6.6.

 

Section 15.8.        Subordination May Not Be Impaired.  No right of any present or future holder of
any Senior Indebtedness to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Company, or by any act or failure to act, in good faith, by any
such holder, or by any noncompliance by the Company, with the terms, provisions
and covenants of this Indenture, regardless of any knowledge thereof that any
such holder may have or otherwise be charged with.

 

Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Securityholders, without
incurring responsibility to the Securityholders and without impairing or
releasing the subordination provided in this Article XV or the obligations
hereunder of the holders of the Debentures to the holders of such Senior
Indebtedness, do any one or more of the following:  (i) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, such Senior
Indebtedness, or otherwise amend or supplement in any manner such Senior
Indebtedness or any instrument evidencing the same or any agreement under which
such Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing such
Senior Indebtedness; (iii) release any Person liable in any manner for the
collection of such Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company, and any other Person.

 

Signatures appear on the following page

 

57

 

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written.

 

 

	
   

  	
  AMERICAN CAPITAL ACCESS HOLDINGS

  LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION, as

  Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

58

 

FORM OF FLOATING RATE JUNIOR SUBORDINATED
DEFERRABLE INTEREST DEBENTURE

 

[FORM OF FACE OF SECURITY]

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAW.  NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.  THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER THIS SECURITY ONLY (A) TO AMERICAN CAPITAL ACCESS HOLDINGS
LIMITED (THE “COMPANY”), (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A SO LONG AS THIS SECURITY IS ELIGIBLE
FOR RESALE PURSUANT TO RULE 144A IN ACCORDANCE WITH RULE 144A,
(D) TO A NON-U.S. PERSON IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
RULE 903 OR RULE 904 (AS APPLICABLE) OF REGULATION S UNDER THE
SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE
MEANING OF SUBPARAGRAPH (A) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO IT
IN ACCORDANCE WITH THE INDENTURE, A COPY OF WHICH MAY BE OBTAINED FROM THE
COMPANY. HEDGING TRANSACTIONS INVOLVING THIS SECURITY MAY NOT BE CONDUCTED
UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

 

THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES,
REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”),  OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THE
SECURITIES OR ANY 

 

A-1-1

 

INTEREST THEREIN, UNLESS SUCH
PURCHASER OR HOLDER IS ELIGIBLE FOR EXEMPTIVE RELIEF AVAILABLE UNDER U.S.
DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38,
90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF
THIS SECURITY IS NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE
CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING. 
ANY PURCHASER OR HOLDER OF THE SECURITIES OR ANY INTEREST THEREIN WILL
BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER
(i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR
OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER
PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO
FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT RESULT IN A PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH
THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

 

THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING AN AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000.00 AND MULTIPLES
OF $1,000.00 IN EXCESS THEREOF.  ANY
ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING AN AGGREGATE PRINCIPAL
AMOUNT OF LESS THAN $100,000.00 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL
EFFECT WHATSOEVER.

 

THE HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE
FOREGOING RESTRICTIONS.

 

THIS SECURITY IS IN REGISTERED FORM WITHIN THE MEANING OF TREASURY
REGULATIONS SECTION 1.871-14(c)(1)(i) FOR U.S. FEDERAL INCOME AND WITHHOLDING
TAX PURPOSES.

 

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE
REQUIRED BY THE INDENTURE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS.

 

Floating Rate Junior Subordinated Deferrable
Interest Debenture

 

of

 

American Capital Access Holdings Limited

 

May 15, 2003

 

American Capital Access Holdings Limited, a corporation duly organized
and existing under the laws of Bermuda (the “Company” which term includes any
successor Person under the Indenture hereinafter referred to), for value
received promises to pay to U.S. Bank National Association, not in its
individual capacity but solely as Institutional Trustee for ACA Statutory 

 

A-1-2

 

Trust II (the “Holder”) or
registered assigns, the principal sum of twenty million six hundred nineteen
thousand dollars ($20,619,000.00) on May 15, 2033, and to pay interest on said
principal sum from May 15, 2003, or from the most recent interest payment date
(each such date, an “Interest Payment Date”) to which interest has been paid or
duly provided for, quarterly (subject to deferral as set forth herein) in arrears
on August 15, November 15, February 15 and May 15 of each year commencing
August 15, 2003, at an annual rate equal to 5.41125% beginning on (and
including) the date of original issuance and ending on (but excluding) August
15, 2003 and at an annual rate for each successive period beginning on (and
including) August 15, 2003, and each succeeding Interest Payment Date, and
ending on (but excluding) the next succeeding Interest Payment Date (each a
“Distribution Period”), equal to 3-Month LIBOR, determined as described below,
plus 4.10% (the “Coupon Rate”); provided, however, that prior to
May 15, 2008, the Coupon Rate shall not exceed 12.50%, applied to the principal
amount hereof, until the principal hereof is paid or duly provided for or made
available for payment, and on any overdue principal and (without duplication
and to the extent that payment of such interest is enforceable under applicable
law) on any overdue installment of interest (including Additional Interest) at
the Coupon Rate in effect for each applicable period, compounded quarterly,
from the dates such amounts are due until they are paid or made available for
payment.  The amount of interest payable
for any period will be computed on the basis of the actual number of days in
the Distribution Period concerned divided by 360.  In the event that any date on which interest
is payable on this Debenture is not a Business Day, then a payment of the
interest payable on such date will be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect of any
such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date the
payment was originally payable.  The
interest installment so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in the Indenture, be paid to the
Person in whose name this Debenture (or one or more Predecessor Securities) is
registered at the close of business on the regular record date for such
interest installment, which shall be fifteen days prior to the day on which the
relevant Interest Payment Date occurs. 
Any such interest installment not so punctually paid or duly provided
for shall forthwith cease to be payable to the Holder on such regular record
date and may be paid to the Person in whose name this Debenture (or one or more
Predecessor Securities) is registered at the close of business on a special
record date.

 

“3-Month LIBOR” as used herein, means the London interbank offered
interest rate for three-month U.S. dollar deposits determined by the Trustee in
the following order of priority:  (i) the
rate (expressed as a percentage per annum) for U.S. dollar deposits having a
three-month maturity that appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date (“Telerate Page 3750” means the
display designated as “Page 3750” on the Dow Jones Telerate Service or such
other page as may replace Page 3750 on that service or such other service or
services as may be nominated by the British Bankers’ Association as the
information vendor for the purpose of displaying London interbank offered rates
for U.S. dollar deposits); (ii) if such rate cannot be identified on the
related Determination Date, the Trustee will request the principal London
offices of four leading banks in the London interbank market to provide such
banks’ offered quotations (expressed as percentages per annum) to prime banks
in the London interbank market for U.S. dollar deposits having a three-month
maturity as of 11:00 a.m. (London time) on such Determination Date.  If at least two quotations are provided, 3-Month
LIBOR will be the arithmetic mean of such quotations; (iii) if fewer than
two such 

 

A-1-3

 

quotations are provided as
requested in clause (ii) above, the Trustee will request four major New York
City banks to provide such banks’ offered quotations (expressed as percentages
per annum) to leading European banks for loans in U.S. dollars as of 11:00 a.m.
(London time) on such Determination Date. 
If at least two such quotations are provided, 3-Month LIBOR will be the
arithmetic mean of such quotations; and (iv) if fewer than two such
quotations are provided as requested in clause (iii) above, 3-Month LIBOR will
be a 3-Month LIBOR determined with respect to the Distribution Period
immediately preceding such current Distribution Period.  If the rate for U.S. dollar deposits having a
three-month maturity that initially appears on Telerate Page 3750 as of 11:00
a.m. (London time) on the related Determination Date is superseded on the
Telerate Page 3750 by a corrected rate by 12:00 noon (London time) on such
Determination Date, then the corrected rate as so substituted on the applicable
page will be the applicable 3-Month LIBOR for such Determination Date.  As used herein, “Determination Date” means
the date that is two London Banking Days (i.e., a business day in which
dealings in deposits in U.S. dollars are transacted in the London interbank
market) preceding the commencement of the relevant Distribution Period.

 

The Interest Rate for any Distribution Period will at no time be higher
than the maximum rate then permitted by New York law as the same may be
modified by United States law.

 

All percentages resulting from any calculations on the Debentures will
be rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward (e.g.,
9.876545% (or .09876545) being rounded to 9.87655% (or .0987655), and all
dollar amounts used in or resulting from such calculation will be rounded to
the nearest cent (with one-half cent being rounded upward)).

 

The principal of and interest on this Debenture shall be payable at the
office or agency of the Trustee (or other paying agent appointed by the
Company) maintained for that purpose in any coin or currency of the United
States of America that at the time of payment is legal tender for payment of
public and private debts; provided, however, that payment of
interest may be made by check mailed to the registered holder at such address
as shall appear in the Debenture Register if a request for a wire transfer by
such holder has not been received by the Company or by wire transfer to an
account appropriately designated by the holder hereof.  Notwithstanding the foregoing, so long as the
holder of this Debenture is the Institutional Trustee, the payment of the
principal of and interest on this Debenture will be made in immediately
available funds at such place and to such account as may be designated by the
Trustee.

 

So long as no Event of Default has occurred and is continuing, the Company
shall have the right, from time to time, and without causing an Event of
Default, to defer payments of interest on the Debentures by extending the
interest payment period on the Debentures at any time and from time to time
during the term of the Debentures, for up to 20 consecutive quarterly
periods (each such extended interest payment period, an “Extension Period”),
during which Extension Period no interest (including Additional Interest) shall
be due and payable (except any Additional Sums that may be due and
payable).  No Extension Period may end on
a date other than an Interest Payment Date. 
During an Extension Period, interest will continue to accrue on the
Debentures, and interest on such accrued interest will accrue at an annual rate
equal to the Interest Rate in effect for such Extension Period, compounded
quarterly from the date such interest would have been payable were it not for
the Extension Period, to the extent permitted by 

 

A-1-4

 

law (such interest referred to
herein as “Additional Interest”).  At the
end of any such Extension Period the Company shall pay all interest then
accrued and unpaid on the Debentures (together with Additional Interest thereon);
provided, however, that no Extension Period may extend beyond the
Maturity Date; provided  further, however, that during any
such Extension Period, the Company shall not and shall not permit any Affiliate
of the Company controlled by the Company to engage in any of the activities or
transactions described on the reverse side hereof and in the Indenture.  Prior to the termination of any Extension
Period, the Company may further extend such period, provided that such period
together with all such previous and further consecutive extensions thereof
shall not exceed 20 consecutive quarterly periods, or extend beyond the
Maturity Date.  Upon the termination of
any Extension Period and upon the payment of all accrued and unpaid interest
and Additional Interest, the Company may commence a new Extension Period,
subject to the foregoing requirements. 
No interest or Additional Interest shall be due and payable during an
Extension Period, except at the end thereof, but each installment of interest
that would otherwise have been due and payable during an Extension Period shall
bear Additional Interest.  The Company
must give the Trustee notice of its election to begin or extend an Extension
Period at least 5 Business Days prior to the regular record date (as such term
is used in Section 2.8 of the Indenture) immediately preceding the
Interest Payment Date with respect to which interest on the Debentures would
have been payable except for the election to begin or extend an Extension
Period.

 

The indebtedness evidenced by this Debenture is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto.  Each holder of this Debenture, by accepting
the same, (a) agrees to and shall be bound by such provisions,
(b) authorizes and directs the Trustee on his or her behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. 
Each holder hereof, by his or her acceptance hereof, hereby waives all
notice of the acceptance of the subordination provisions contained herein and
in the Indenture by each holder of Senior Indebtedness, whether now outstanding
or hereafter incurred, and waives reliance by each such holder upon said
provisions.

 

This Debenture shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until
the certificate of authentication hereon shall have been signed by or on behalf
of the Trustee.

 

The provisions of this Debenture are continued on the reverse side
hereof and such provisions shall for all purposes have the same effect as
though fully set forth at this place.

 

A-1-5

 

IN WITNESS WHEREOF, the Company has duly executed this certificate.

 

	
   

  	
  American Capital Access Holdings Limited

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

 

CERTIFICATE OF AUTHENTICATION

 

This is one of the Debentures referred to in the within-mentioned
Indenture.

 

	
   

  	
  U. S. Bank, National Association, as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  

 

A-1-6

 

[FORM OF REVERSE OF DEBENTURE]

 

This Debenture is one of the floating rate junior subordinated
deferrable interest debentures of the Company, all issued or to be issued under
and pursuant to the Indenture dated as of May 15, 2003 (the “Indenture”), duly
executed and delivered between the Company and the Trustee, to which Indenture
reference is hereby made for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders of the Debentures. 
The Debentures are limited in aggregate principal amount as specified in
the Indenture.

 

Upon the occurrence and continuation of a Special Event prior to May
15, 2008, the Company shall have the right to redeem the Debentures in whole,
but not in part, at any Interest Payment Date, within 120 days following the
occurrence of such Special Event, at the Special Redemption Price.

 

In addition, the Company shall have the right to redeem the Debentures,
in whole or in part, but in all cases in a principal amount with integral
multiples of $1,000.00, on any Interest Payment Date on or after May 15, 2008,
at the Optional Redemption Price.

 

Prior to 10:00 a.m. New York City time on the Optional Redemption Date
or Special Redemption Date, as applicable, the Company will deposit with the
Trustee or with one or more paying agents an amount of money sufficient to
redeem on the Optional Redemption Date or the Special Redemption Date, as
applicable, all the Debentures so called for redemption at the appropriate Optional
Redemption Price or Special Redemption Price.

 

If all, or less than all, the Debentures are to be redeemed, the
Company will give the Trustee notice not less than 45 nor more than
60 days prior to the Optional Redemption Date or Special Redemption Date,
as applicable, as to the aggregate principal amount of Debentures to be
redeemed and the Trustee shall select, in such manner as in its sole discretion
it shall deem appropriate and fair, the Debentures or portions thereof (in
integral multiples of $1,000.00) to be redeemed.

 

Notwithstanding the foregoing, any redemption of Debentures by the
Company shall be subject to the receipt of any and all required regulatory
approvals.

 

In case an Event of Default shall have occurred and be continuing, upon
demand of the Trustee, the principal of all of the Debentures 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 consent of the holders of not less than a majority in
aggregate principal amount of the Debentures at the time outstanding, to
execute supplemental indentures for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture
or of any supplemental indenture or of modifying in any manner the rights of
the holders of the Debentures; provided, however, that no such
supplemental indenture shall without the consent of the holders of each
Debenture then outstanding and affected thereby (i) change the fixed
maturity of any Debenture, or reduce the principal amount thereof or any
premium thereon, or reduce the rate or extend the time of payment of interest
thereon, or reduce any amount 

 

A-1-7

 

payable on redemption thereof
or make the principal thereof or any interest or premium thereon payable in any
coin or currency other than that provided in the Debentures, or impair or
affect the right of any Securityholder to institute suit for payment thereof or
impair the right of repayment, if any, at the option of the holder, or
(ii) reduce the aforesaid percentage of Debentures the holders of which
are required to consent to any such supplemental indenture.

 

The Indenture also contains provisions permitting the holders of a
majority in aggregate principal amount of the Debentures at the time
outstanding on behalf of the holders of all of the Debentures to waive (or
modify any previously granted waiver of) any past default or Event of Default,
and its consequences, except a default (a) in the payment of principal of,
premium, if any, or interest on any of the Debentures, (b) in respect of
covenants or provisions hereof or of the Indenture which cannot be modified or
amended without the consent of the holder of each Debenture affected, or
(c) in respect of the covenants contained in Section 3.9 of the
Indenture; provided, however, that if the Debentures are held by
the Trust or a trustee of such trust, such waiver or modification to such
waiver shall not be effective until the holders of a majority in Liquidation
Amount of Trust Securities of the Trust shall have consented to such waiver or
modification to such waiver, provided, further, that if the
consent of the holder of each outstanding Debenture is required, such waiver
shall not be effective until each holder of the Trust Securities of the Trust
shall have consented to such waiver. 
Upon any such waiver, the default covered thereby shall be deemed to be
cured for all purposes of the Indenture and the Company, the Trustee and the
holders of the Debentures shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.  Whenever any default or Event
of Default hereunder shall have been waived as permitted by the Indenture, said
default or Event of Default shall for all purposes of the Debentures and the
Indenture be deemed to have been cured and to be not continuing.

 

No reference herein to the Indenture and no provision of this Debenture
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and premium, if any, and
interest, including Additional Interest, on this Debenture at the time and
place and at the rate and in the money herein prescribed.

 

The Company has agreed that if Debentures are initially issued to the
Trust or a trustee of such Trust in connection with the issuance of Trust
Securities by the Trust (regardless of whether Debentures continue to be held
by such Trust) and (i) there shall have occurred and be continuing an
Event of Default, (ii) the Company shall be in default with respect to its
payment of any obligations under the Capital Securities Guarantee, or
(iii) the Company shall have given notice of its election to defer
payments of interest on the Debentures by extending the interest payment period
as provided herein and such Extension Period, or any extension thereof, shall
be continuing, then the Company shall not, and shall not permit any Affiliate
of the Company controlled by the Company 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 Company’s or such Affiliates’
capital stock (other than payments of dividends or distributions to the Company
or a Subsidiary of the Company) or make any guarantee payments with respect to
the foregoing or (y) make any payment of principal of or interest or
premium, if any, on or repay, repurchase or redeem any debt securities of the
Company or any Affiliate of the Company controlled by the

 

A-1-8

 

Company that rank pari passu in all respects with or junior
in interest to the Debentures (other than, with respect to clauses (x) and (y)
above,  (1) repurchases, redemptions
or other acquisitions of shares of capital stock of the Company or any
Subsidiary of the Company in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of one or more
employees, officers, directors or consultants, in connection with a dividend
reinvestment or stockholder stock purchase plan or in connection with the
issuance of capital stock of the Company or of such Subsidiary (or securities
convertible into or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to the applicable Extension Period,
(2) as a result of any exchange or conversion of any class or series of
the Company’s capital stock (or any capital stock of a Subsidiary of the
Company) for any class or series of the Company’s capital stock (or in the case
of a Subsidiary of the Company, any class or series of such Subsidiary’s
capital stock) or of any class or series of the Company’s indebtedness for any
class or series of the Company’s capital stock (or in the case of indebtedness
of a Subsidiary of the Company, of any class or series of such Subsidiary’s
indebtedness or any class or series of such Subsidiary’s capital stock),
(3) the purchase of fractional interests in shares of the Company’s
capital stock (or the capital stock of a Subsidiary of the Company) pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, (4) any declaration of a dividend in
connection with any stockholders’ rights plan, or the issuance of rights, stock
or other property under any stockholders’ rights plan, or the redemption or
repurchase of rights pursuant thereto, (5) any dividend in the form of
stock, warrants, options or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks pari passu with or junior to such stock
and any cash payments in lieu of fractional shares issued in connection
therewith, or (6) payments under the Capital Securities Guarantee).

 

The Debentures are issuable only in registered, certificated form
without coupons and in minimum denominations of $100,000.00 and any multiple of
$1,000.00 in excess thereof.  As provided
in the Indenture and subject to the transfer restrictions and limitations as
may be contained herein and therein from time to time, this Debenture is
transferable by the holder hereof on the Debenture Register of the
Company.  Upon due presentment for
registration of transfer of any Debenture at the Principal Office of the
Trustee or at any office or agency of the Company maintained for such purpose
as provided in Section 3.2 of the Indenture, the Company shall execute,
the Company or the Trustee shall register and the Trustee or the Authenticating
Agent shall authenticate and make available for delivery in the name of the
transferee or transferees a new Debenture for a like aggregate principal
amount.  All Debentures presented for
registration of transfer or for exchange or payment shall (if so required by
the Company or the Trustee or the Authenticating Agent) be duly endorsed by, or
be accompanied by a written instrument or instruments of transfer in form
satisfactory to, the Company and the Trustee or the Authenticating Agent duly
executed by the holder or his attorney duly authorized in writing.  No service charge shall be made for any
exchange or registration of transfer of Debentures, but the Company or the
Trustee may require payment of a sum sufficient to cover any tax, fee or other
governmental charge that may be imposed in connection therewith.

 

Prior to due presentment for registration of transfer of any Debenture,
the Company, the Trustee, any Authenticating Agent, any paying agent, any
transfer agent and any Debenture registrar may deem the Person in whose name
such Debenture shall be registered upon the 

 

A-1-9

 

Debenture Register to be, and
may treat him as, the absolute owner of such Debenture (whether or not such
Debenture shall be overdue) for the purpose of receiving payment of or on
account of the principal of, premium, if any, and interest on such Debenture
and for all other purposes; and neither the Company nor the Trustee nor any
Authenticating Agent nor any paying agent nor any transfer agent nor any
Debenture registrar shall be affected by any notice to the contrary.  All such payments so made to any holder for
the time being or upon his order shall be valid, and, to the extent of the sum
or sums so paid, effectual to satisfy and discharge the liability for moneys
payable upon any such Debenture.

 

The Debentures are in registered form within the meaning of Treasury
Regulations Section 1.871-14(c)(1)(i) for U.S. federal income and withholding
tax purposes.

 

No recourse for the payment of the principal of or premium, if any, or
interest on any Debenture, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture or in any supplemental indenture, or
in any such Debenture, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder,
employee, officer or director, as such, past, present or future, of the Company
or of any successor Person of the Company, either directly or through the
Company or any successor Person of the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, it being expressly understood that all such liability
is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of the Indenture and the issue of the
Debentures.

 

Capitalized terms used and not defined in this Debenture shall have the
meanings assigned in the Indenture dated as of the date of original issuance of
this Debenture between the Trustee and the Company.

 

THE INDENTURE AND THE DEBENTURES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAW PRINCIPLES THEREOF.

 

A-1-10

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